Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Dec. 29, 2018 | Feb. 05, 2019 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Dec. 29, 2018 | |
Entity Registrant Name | PTC Inc. | |
Entity Central Index Key | 857,005 | |
Current Fiscal Year End Date | --09-30 | |
Document Fiscal Year Focus | 2,019 | |
Document Fiscal Period Focus | Q1 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 118,627,720 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
ASSETS | ||
Cash and cash equivalents | $ 276,990 | $ 259,946 |
Short-term marketable securities | 25,598 | 25,836 |
Accounts receivable, net of allowance for doubtful accounts of $564 and $607 at December 29, 2018 and September 30, 2018, respectively | 385,670 | 129,297 |
Prepaid expenses | 63,045 | 48,997 |
Other current assets | 48,682 | 169,708 |
Total current assets | 799,985 | 633,784 |
Property and equipment, net | 107,359 | 80,613 |
Goodwill | 1,230,901 | 1,182,457 |
Acquired intangible assets, net | 205,084 | 200,202 |
Long-term marketable securities | 30,054 | 30,115 |
Deferred tax assets | 201,149 | 165,566 |
Other assets | 178,437 | 36,285 |
Total assets | 2,752,969 | 2,329,022 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Accounts payable | 57,249 | 53,473 |
Accrued expenses and other current liabilities | 83,721 | 74,388 |
Accrued compensation and benefits | 74,483 | 101,784 |
Accrued income taxes | 405 | 18,044 |
Deferred revenue | 325,111 | 487,590 |
Total current liabilities | 540,969 | 735,279 |
Long-term debt | 778,484 | 643,268 |
Deferred tax liabilities | 36,261 | 5,589 |
Deferred revenue | 10,197 | 11,852 |
Other liabilities | 65,889 | 58,445 |
Total liabilities | 1,431,800 | 1,454,433 |
Commitments and contingencies (Note 14) | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value; 5,000 shares authorized; none issued | 0 | 0 |
Common stock, $0.01 par value; 500,000 shares authorized; 118,657 and 117,981 shares issued and outstanding at December 29, 2018 and September 30, 2018, respectively | 1,187 | 1,180 |
Additional paid-in capital | 1,553,875 | 1,558,403 |
Accumulated deficit | (138,785) | (599,409) |
Accumulated other comprehensive loss | (95,108) | (85,585) |
Total stockholders’ equity | 1,321,169 | 874,589 |
Total liabilities and stockholders’ equity | $ 2,752,969 | $ 2,329,022 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
Current assets: | ||
Allowance for doubtful accounts | $ 564 | $ 607 |
Stockholders’ equity: | ||
Preferred stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 118,657,000 | 117,981,000 |
Common stock, shares outstanding | 118,567,000 | 117,981,000 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Revenue: | ||
Revenue | $ 334,689 | $ 306,644 |
Cost of revenue: | ||
Cost of revenue | 77,352 | 83,035 |
Gross margin | 257,337 | 223,609 |
Operating expenses: | ||
Sales and marketing | 104,218 | 99,375 |
Research and development | 60,782 | 63,972 |
General and administrative | 37,864 | 35,020 |
Amortization of acquired intangible assets | 5,936 | 7,821 |
Restructuring and other charges, net | 18,493 | 105 |
Total operating expenses | 227,293 | 206,293 |
Operating income | 30,044 | 17,316 |
Interest expense | (10,276) | (10,047) |
Other income (expense), net | 655 | (798) |
Income before income taxes | 20,423 | 6,471 |
Benefit for income taxes | (562) | (7,406) |
Net income | $ 20,985 | $ 13,877 |
Earnings per share—Basic (in USD per share) | $ 0.18 | $ 0.12 |
Earnings per share—Diluted (in USD per share) | $ 0.18 | $ 0.12 |
Weighted average shares outstanding—Basic (in shares) | 118,323 | 115,731 |
Weighted average shares outstanding—Diluted (in shares) | 119,638 | 117,656 |
Software | ||
Revenue: | ||
Revenue | $ 293,243 | $ 265,190 |
Cost of revenue: | ||
Cost of revenue | 43,760 | 46,616 |
License | ||
Revenue: | ||
Revenue | 105,322 | 119,518 |
Cost of revenue: | ||
Cost of revenue | 12,563 | 12,114 |
Support and cloud services | ||
Revenue: | ||
Revenue | 187,921 | 145,672 |
Cost of revenue: | ||
Cost of revenue | 31,197 | 34,502 |
Professional services | ||
Revenue: | ||
Revenue | 41,446 | 41,454 |
Cost of revenue: | ||
Cost of revenue | $ 33,592 | $ 36,419 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 20,985 | $ 13,877 |
Other comprehensive income (loss), net of tax: | ||
Realized and unrealized hedge gain (loss) arising during the period, net of tax of $0 million and $0.1 million in the first quarter of 2019 and 2018, respectively | (2,129) | (913) |
Net hedge (gain) loss reclassified into earnings, net of tax of $0.1 million in the first quarter of 2019 and $0.1 million in the first quarter of 2018 | (549) | 573 |
Unrealized loss on hedging instruments | (2,678) | (340) |
Foreign currency translation adjustment, net of tax of $0 for each period | (7,569) | 5,229 |
Unrealized gain (loss) on marketable securities, net of tax of $0 for each period | 13 | (179) |
Amortization of net actuarial pension loss included in net income, net of tax of $0.2 million and $0.2 million in the first quarter of 2019 and 2018, respectively | 430 | 371 |
Change in unamortized pension loss during the period related to changes in foreign currency | 281 | (263) |
Other comprehensive income (loss) | (9,523) | 4,818 |
Comprehensive income | $ 11,462 | $ 18,695 |
Consolidated Statements Of Co_2
Consolidated Statements Of Comprehensive Income (Loss) (Parenthetical) - USD ($) | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Unrealized hedge gain (loss) arising during the period, tax | $ 0 | $ 100,000 |
Net hedge loss reclassified into earnings, tax | 100,000 | 100,000 |
Foreign currency translation adjustment, tax | 0 | 0 |
Unrealized gain (loss) marketable securities tax | 0 | 0 |
Amortization of net actuarial pension loss included in net income, tax | $ 200,000 | $ 200,000 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 20,985 | $ 13,877 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 20,053 | 21,046 |
Stock-based compensation | 29,407 | 18,331 |
Other non-cash items, net | (5) | 361 |
Changes in operating assets and liabilities, excluding the effects of acquisitions: | ||
Accounts receivable | 24,025 | 21,603 |
Accounts payable and accrued expenses | (9,628) | (12,885) |
Accrued compensation and benefits | (27,504) | (40,172) |
Deferred revenue | (21,820) | 22,055 |
Accrued income taxes | (21,668) | (14,272) |
Other current assets and prepaid expenses | 849 | (8,575) |
Other noncurrent assets and liabilities | 6,520 | 4,146 |
Net cash provided by operating activities | 21,214 | 25,515 |
Cash flows from investing activities: | ||
Additions to property and equipment | (30,332) | (6,377) |
Purchase of intangible asset | 0 | (2,500) |
Purchases of short- and long-term marketable securities | (6,736) | (4,248) |
Proceeds from maturities of short- and long-term marketable securities | 7,007 | 3,740 |
Acquisitions of businesses, net of cash acquired | (69,556) | 0 |
Settlement of net investment hedges | (1,595) | 0 |
Net cash used in investing activities | (101,212) | (9,385) |
Cash flows from financing activities: | ||
Borrowings under credit facility | 155,000 | 50,000 |
Repayments of borrowings under credit facility | (20,000) | (20,000) |
Proceeds (costs) from issuance of common stock | (4,640) | 0 |
Contingent consideration | (1,575) | (3,176) |
Payments of withholding taxes in connection with stock-based awards | (33,788) | (33,488) |
Net cash provided by (used in) financing activities | 94,997 | (6,664) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 2,041 | 2,598 |
Net increase in cash, cash equivalents, and restricted cash | 17,040 | 12,064 |
Cash, cash equivalents, and restricted cash, beginning of period | 261,093 | 281,209 |
Cash, cash equivalents, and restricted cash, end of period | $ 278,133 | $ 293,273 |
Consolidated Statement of Stock
Consolidated Statement of Stockholder's Equity Statement - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Net Investment Hedging | Net Investment HedgingAccumulated Other Comprehensive Loss | Cash Flow Hedging | Cash Flow HedgingAccumulated Other Comprehensive Loss |
Cumulative Effect of New Accounting Principle in Period of Adoption | Accounting Standards Update 2016-09 | $ 125 | $ 681 | $ (556) | ||||||
Beginning balance (in shares) at Sep. 30, 2017 | 115,333 | ||||||||
Beginning balance at Sep. 30, 2017 | 885,436 | $ 1,153 | 1,609,030 | (650,840) | $ (73,907) | ||||
Common stock issued for employee stock-based awards | 0 | $ 13 | (13) | ||||||
Common stock issued for employee stock-based awards (in shares) | 1,317 | ||||||||
Shares surrendered by employees to pay taxes related to stock-based awards | (33,488) | $ (5) | (33,483) | ||||||
Shares surrendered by employees to pay taxes related to stock-based awards (in shares) | (524) | ||||||||
Compensation expense from stock-based awards | 18,331 | 18,331 | |||||||
Net income | 13,877 | 13,877 | |||||||
Unrealized gain (loss) on hedging instruments, net of tax | (340) | $ (340) | $ (340) | ||||||
Foreign currency translation adjustment | 5,229 | 5,229 | |||||||
Unrealized loss on available-for-sale securities, net of tax | (179) | (179) | |||||||
Change in pension benefits, net of tax | 108 | 108 | |||||||
Ending balance (in shares) at Dec. 30, 2017 | 116,126 | ||||||||
Ending balance at Dec. 30, 2017 | 889,099 | $ 1,161 | 1,594,546 | (637,519) | (69,089) | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption | Accounting Standards Update 2016-16 | 72,261 | 72,261 | |||||||
Cumulative Effect of New Accounting Principle in Period of Adoption | Accounting Standards Update 2014-09 | $ 367,378 | 367,378 | |||||||
Beginning balance (in shares) at Sep. 30, 2018 | 117,981 | 117,981 | |||||||
Beginning balance at Sep. 30, 2018 | $ 874,589 | $ 1,180 | 1,558,403 | (599,409) | (85,585) | ||||
Common stock issued for employee stock-based awards | 0 | $ 11 | (11) | ||||||
Common stock issued for employee stock-based awards (in shares) | 1,056 | ||||||||
Shares surrendered by employees to pay taxes related to stock-based awards | (33,788) | $ (4) | (33,784) | ||||||
Shares surrendered by employees to pay taxes related to stock-based awards (in shares) | (380) | ||||||||
Common stock issued | (140) | (140) | |||||||
Compensation expense from stock-based awards | 29,407 | 29,407 | |||||||
Net income | 20,985 | 20,985 | |||||||
Unrealized gain (loss) on hedging instruments, net of tax | (2,678) | $ (2,293) | $ (2,293) | $ (385) | $ (385) | ||||
Foreign currency translation adjustment | (7,569) | (7,569) | |||||||
Unrealized loss on available-for-sale securities, net of tax | 13 | 13 | |||||||
Change in pension benefits, net of tax | $ 711 | 711 | |||||||
Ending balance (in shares) at Dec. 29, 2018 | 118,567 | 118,657 | |||||||
Ending balance at Dec. 29, 2018 | $ 1,321,169 | $ 1,187 | $ 1,553,875 | $ (138,785) | $ (95,108) |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Dec. 29, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation General The accompanying unaudited condensed consolidated financial statements include the accounts of PTC Inc. and its wholly owned subsidiaries and have been prepared by management in accordance with accounting principles generally accepted in the United States of America and in accordance with the rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. While we believe that the disclosures presented are adequate in order to make the information not misleading, these unaudited quarterly financial statements should be read in conjunction with our annual consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2018 . In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting only of those of a normal recurring nature, necessary for a fair statement of our financial position, results of operations and cash flows at the dates and for the periods indicated. The September 30, 2018 Consolidated Balance Sheet included herein is derived from our audited consolidated financial statements. Unless otherwise indicated, all references to a year mean our fiscal year, which ends on September 30. Our fiscal quarters end on a Saturday following a thirteen-week calendar, and may result in different quarter end dates year to year. The first quarter of 2019 ended on December 29, 2018 and the first quarter of 2018 ended on December 30, 2017 . The results of operations for the three months ended December 29, 2018 are not necessarily indicative of the results expected for the remainder of the fiscal year. Changes in Presentation and Reclassifications On October 1, 2018, we adopted ASU No. 2014-09, Revenue from Contracts with Customers: Topic 606 (ASC 606). Results for reporting periods beginning on or after October 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported in accordance with the guidance provided by ASC 985-605, Software-Revenue Recognition and revenues for non-software deliverables in accordance with ASC 605-25, Revenue Recognition, Multiple-Element Arrangements (ASC 605). In connection with the adoption, we changed our presentation of the statement of operations to reflect revenue and associated costs as license, support and cloud services, and professional services. For the prior year period, all components of subscription licenses (including support) are included in license revenue. Prior to our adoption of 606, revenues from subscription licenses and support thereon were not separated and were previously included in subscription revenue in our consolidated statement of operations since we did not have VSOE of fair value for support on subscription sales. In addition, revenue and costs associated with our cloud services, which are immaterial and were previously reported in subscription revenue, are classified as support and cloud services for all periods presented. Effective at the beginning of fiscal 2019, in accordance with the adoption of ASU 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost, all non-service net periodic pension costs are now presented in Other income (expense), net on the Consolidated Statement of Operations. The prior period non-service net periodic pension cost amounts have been reclassified for comparability. Effective at the beginning of fiscal 2019, in accordance with the adoption of ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, restricted cash is now included with cash and cash equivalents in the net cash increase (decrease), beginning of period total amount and end of period total amount on the Consolidated Statements of Cash Flows. The prior period restricted cash amounts have been reclassified for comparability. As of December 29, 2018 and September 30, 2018, $1.1 million of restricted cash was included in other current assets. Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements Revenue Recognition On October 1, 2018, we adopted ASC 606, which supersedes substantially all existing revenue recognition guidance under U.S. GAAP. We adopted ASC 606 using the modified retrospective method, under which the cumulative effect of initially applying ASC 606 was recorded as a reduction to accumulated deficit with no restatement of comparative periods. The core principle of ASC 606 is to recognize revenue when promised goods or services are transferred to a customer in an amount that reflects the consideration that is expected to be received for those goods or services. Under the new guidance, an entity is required to evaluate revenue recognition through a five-step process: (1) identifying a contract with a customer; (2) identifying the performance obligations in the contract; (3) determining the transaction price; (4) allocating the transaction price to the performance obligations in the contract; and (5) recognizing revenue when (or as) the entity satisfies a performance obligation. The standard also requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In applying the principles of ASC 606, more judgment and estimates are required within the revenue recognition process than is required under previous U.S. GAAP, including identifying performance obligations, estimating the amount of variable consideration to include in the transaction price, and estimating the value of each performance obligation to allocate the total transaction price to each separate performance obligation. The most significant impact of ASC 606 relates to accounting for our subscription arrangements that include term-based on-premise software licenses bundled with support. Under previous GAAP (through September 30, 2018), revenue attributable to these subscription licenses was recognized ratably over the term of the arrangement because VSOE does not exist for the undelivered support element as it is not sold separately. Under the new standard, the requirement to have VSOE for undelivered elements to enable the separation of revenue for the delivered software licenses is eliminated. Accordingly, under the new standard we recognize as revenue a portion of the subscription fee upon delivery of the software license. Revenue recognition related to our perpetual licenses and related support contracts, professional services and cloud offerings is substantially unchanged, with support and cloud revenue being recorded ratably over the contract term. Due to the complexity of certain of our contracts, the actual revenue recognition treatment required under the new standard may be dependent on contract-specific terms and, therefore, may vary in some instances. Upon implementation of the new standard in fiscal 2019, we made prospective revisions to contract terms with our customers that will result in shortening the initial, non-cancellable term of our multi-year subscriptions to one year for contract periods that begin on or after October 1, 2018. This change will result in annual contractual periods for most of our software subscriptions, the license portion of which will be recognized at the beginning of each annual contract period upon delivery of the licenses and the support portion of which will be recognized ratably over the one-year contractual period. As a result, we anticipate one year of subscription revenue will be recognized for each contract each year; however, more of the revenue will be recognized in the quarter that the contract period begins and less will be recognized in the subsequent three quarters of the contract than under ASC 605. Under the modified retrospective method, we evaluated each contract that was ongoing on October 1, 2018 as if that contract had been accounted for under ASC 606 from contract inception. Some license revenue related to subscription arrangements that would have been recognized in future periods under current GAAP was recast under ASC 606 as if the revenue had been recognized in prior periods. Under this transition method, we did not adjust historical reported revenue amounts. Instead, the revenue that would have been recognized under this method prior to the adoption date was recorded as an adjustment to accumulated deficit and will not be recognized as revenue in future periods as previously expected. Because license revenue associated with subscription contracts is recognized up front instead of over time under ASC 606, a material portion of our deferred revenue was adjusted to accumulated deficit upon adoption. Another significant provision under ASC 606 includes the capitalization and amortization of costs associated with obtaining a contract, such as sales commissions. Prior to October 1, 2018, we expensed commissions in the period incurred. Under ASC 606, direct and incremental costs to acquire a contract are capitalized and amortized using a systematic basis over the pattern of transfer of the goods and services to which the asset relates. Refer to Note 2. Revenue from Contracts with Customers for further detail about the impact of the adoption of ASC 606 and further disclosures. Income Taxes In October 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. The purpose of ASU 2016-16 is to simplify the income tax accounting of an intra-entity transfer of an asset other than inventory and to record its effect when the transfer occurs. We adopted this amendment beginning in the first quarter of 2019 using the modified retrospective method with a cumulative effect adjustment to accumulated deficit of $72.3 million , with a corresponding increase of $75.3 million to deferred tax assets, $6.0 million decrease to income tax assets and a $3.0 million decrease to income tax liabilities. The adjustment primarily relates to deductible amortization of intangible assets in Ireland. Post adoption, our effective tax rate no longer includes the benefit of this amortization. Pension Accounting In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost, which provides guidance on the capitalization, presentation and disclosure of net benefit costs related to postretirement benefit plans. We adopted the new guidance in the first quarter of 2019 on a full retrospective basis, which resulted in the retrospective reclassification of $0.2 million of non-service net periodic pension cost for the three months ended December 30, 2017 from line items within cost of revenue and operating expenses into Other income (expense), net on the Consolidated Statement of Operations. Equity Investments In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, which provides guidance for the recognition, measurement, presentation, and disclosure of financial assets and liabilities and requires equity securities to be measured at fair value, unless the measurement alternative method has been elected for equity investments without readily determinable fair values. Adoption of this guidance in the first quarter of fiscal 2019 did not have a material impact on our consolidated financial statements. Restricted Cash In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. The new guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the Statement of Cash Flows. Adoption of this guidance in the first quarter of fiscal 2019 did not have a material impact on our consolidated financial statements. Pending Accounting Pronouncements Derivative Financial Instruments In August 2017, the FASB issued ASU No. 2017-12, "Derivatives and Hedging (Topic 815) Targeted Improvements to Accounting for Hedging Activities", which amends and simplifies existing guidance to allow companies to more accurately present the economic effects of risk management activities in the financial statements. The guidance is effective for annual reporting periods beginning after December 15, 2018 (our fiscal 2020) including interim reporting periods within those annual reporting periods and early adoption is permitted. We are currently evaluating the impact of the new guidance on our consolidated financial statements. Leases In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which will replace the existing guidance in ASC 840, Leases. The updated standard aims to increase transparency and comparability among organizations by requiring lessees to recognize lease assets and lease liabilities on the balance sheet and to disclose important information about leasing arrangements. ASU 2016-02 is effective for annual periods beginning after December 15, 2018 (our fiscal 2020) and interim periods within those annual periods. Early adoption is permitted and modified retrospective application is required. We are currently evaluating the impact of the new guidance on our consolidated financial statements. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 3 Months Ended |
Dec. 29, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Upon adoption of ASC 606, we recorded a decrease in accumulated deficit of $431.9 million ( $367.4 million , net of tax) due to the cumulative effect of the ASC 606 adoption, with the impact primarily derived from revenue related to on-premise subscription software licenses. Nature of Products and Services Our sources of revenue include: (1) subscription, (2) perpetual license, (3) perpetual support and (4) professional services. Revenue is derived from the licensing of computer software products and from related support contracts. We enter into contracts that include combinations of products, support and professional services, which are accounted for as separate performance obligations with differing revenue recognition patterns. Performance Obligation When Performance Obligation is Typically Satisfied Term-based subscriptions On-premise software licenses Point in Time: Upon the later of when the software is made available or the subscription term commences Support and cloud-based offerings Over Time: Ratably over the contractual term; commencing upon the later of when the software is made available or the subscription term commences Perpetual software licenses Point in Time: when the software is made available Support for perpetual software licenses Over Time: Ratably over the contractual term Professional services Over time: As services are provided Judgments and Estimates Our contracts with customers for subscriptions typically include commitments to transfer term-based on-premise software licenses bundled with support and/or cloud services. On-premise software is determined to be a distinct performance obligation from support which is sold for the same term of the subscription. For subscription arrangements which include cloud services, we assessed whether the cloud component was highly interrelated with on-premise term software licenses. Other than a limited population of subscriptions, the cloud component is not currently deemed to be interrelated with the on-premise term software and, as a result, cloud services will be accounted for as a distinct performance obligation from the software and support components of the subscription. Judgment is required to allocate the transaction price to each performance obligation. We use the estimated standalone selling price method to allocate the transaction price for items that are not sold separately. The estimated standalone selling price is determined using all information reasonably available to us, including market conditions and other observable inputs. The corresponding revenues are recognized as the related performance obligations are satisfied. We determined that 50% to 55% of the estimated standalone selling price for subscriptions that contain distinct license and support performance obligations are attributable to software licenses and 45% to 50% , depending upon the product offering, is attributable to support for those licenses. Our standard multi-year, non-cancellable on-premise subscription contracts provide customers with an annual right to exchange software within the original subscription with other software. Although the exchange right is limited to software products within a similar product grouping, the exchange right is not limited to products with substantially similar features and functionality as those originally delivered. We determined that this right to exchange previously delivered software for different software represents variable consideration to be accounted for as a liability. We have identified a standard portfolio of contracts with common characteristics and applied the expected value method of determining variable consideration associated with this right. Additionally, where there are isolated situations that are outside of the standard portfolio of contracts due to contract size, longer contract duration, or other unique contractual terms, we used the most likely amount method to determine the amount of variable consideration. In both circumstances, the amount of variable consideration included in the transaction price is constrained by an amount where it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. As of December 29, 2018, the total refund liability was $23.6 million , primarily associated with the annual right to exchange on-premise subscription software. Contract Assets and Contract Liabilities December 29, 2018 October 1, 2018, as adjusted (in thousands) Contract asset $ 14,513 $ 26,265 Deferred revenue $ 335,119 $ 357,490 As of December 29, 2018, our contract assets are expected to be transferred to receivables within the next 12 months and therefore are included in other current assets. Approximately $12.2 million of the October 1, 2018 contract asset balance was transferred to receivables during the current period as a result of the right to payment becoming unconditional. The majority of both the contract asset balance and the amounts transferred to receivables relates to two large professional services contracts with invoicing terms based on performance milestones. Additions to contract assets of approximately $0.4 million related to revenue recognized in the period, net of period billings. There were no impairments of contract assets during the three months ended December 29, 2018. During the three months ended December 29, 2018, $153.7 million of revenue that was included in the deferred revenue opening balance was recognized. There were additional deferrals of $131.3 million , which were primarily related to new billings. Costs to Obtain or Fulfill a Contract The new revenue recognition standard requires the capitalization of certain incremental costs of obtaining a contract, which impacts the period in which we record our commission expense. Prior to our adoption of the new revenue standard, we recognized commissions expense as incurred. Under the new revenue recognition standard, we are required to recognize these expenses over the period of benefit associated with these costs. This results in a deferral of certain commission expenses each period. Upon adoption, we reduced our accumulated deficit by $70.0 million and recognized an offsetting asset for deferred commission related to contracts that were not completed prior to October 1, 2018. We recognize an asset for the incremental costs of obtaining a contract with a customer if the benefit of those costs is expected to be longer than one year. These deferred costs are amortized proportionately related to revenue over five years, which is generally longer than the term of the initial contract because of anticipated renewals as commissions for renewals are not commensurate with commissions related to our initial contracts. As of December 29, 2018, deferred costs of $19.9 million were included in other current assets and $52.5 million were included in other assets (non-current). As the revenue recognition pattern has changed under ASC 606, the costs to fulfill contracts has also changed to match this pattern of expense recognition. As of October 1, 2018, this resulted in a $2.8 million increase in our accumulated deficit with recognition of an offsetting current liability. Remaining Performance Obligations Our contracts with customers include amounts allocated to performance obligations that will be satisfied at a later date. As of December 29, 2018, amounts allocated to these remaining performance obligations are $938 million , of which we expect to recognize 90% over the next 24 months with the remaining amount thereafter. Disaggregation of Revenue Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, 2018 December 29, 2018 December 30, 2017 Revenue (in thousands) Subscription license $ 63,517 Subscription support & cloud services 77,424 Total Subscription 140,941 $ 148,413 $ 100,008 Perpetual support 110,497 109,225 131,197 Total recurring revenue 251,438 257,638 231,205 Perpetual license 41,805 41,750 33,985 Total software revenue 293,243 299,388 265,190 Professional services 41,446 39,369 41,454 Total revenue $ 334,689 $ 338,757 $ 306,644 For further disaggregation of revenue by geographic region and product area see Note 11. Segment and Geographical Information . Practical Expedients We elected certain practical expedients with the adoption of the new revenue standard. We do not account for significant financing components if the period between revenue recognition and when the customer pays for the products or services will be one year or less. Additionally, we recognize revenue equal to the amount we have a right to invoice, when the amount corresponds directly with the value to the customer of our performance date. Transition Disclosures In accordance with the modified retrospective method transition requirements, we will present the financial statement line items impacted and adjusted to compare to presentation under ASC 605 for each of the interim and annual periods during the first year of adoption of ASC 606. The following tables present our Balance Sheets and Statements of Operations as reported under ASC 606 for the current period with comparative periods reported under ASC 605: As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, September 30, ASSETS Current assets: Cash and cash equivalents $ 276,990 $ 276,990 $ 259,946 Short-term marketable securities 25,598 25,598 25,836 Accounts receivable (1) 385,670 138,989 129,297 Prepaid expenses 63,045 63,045 48,997 Other current assets (2) 48,682 143,104 169,708 Total current assets 799,985 647,726 633,784 Property and equipment, net 107,359 107,359 80,613 Goodwill 1,230,901 1,230,901 1,182,457 Acquired intangible assets, net 205,084 205,084 200,202 Long-term marketable securities 30,054 30,054 30,115 Deferred tax assets (3) 201,149 234,558 165,566 Other assets (4) 178,437 34,328 36,285 Total assets $ 2,752,969 $ 2,490,010 $ 2,329,022 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 57,249 $ 57,249 $ 53,473 Accrued expenses and other current liabilities (5) 83,721 56,897 74,388 Accrued compensation and benefits 74,483 74,483 101,784 Accrued income taxes (3) 405 4,958 18,044 Deferred revenue (6) 325,111 484,613 487,590 Total current liabilities 540,969 678,200 735,279 Long-term debt 778,484 778,484 643,268 Deferred tax liabilities (3) 36,261 5,731 5,589 Deferred revenue (6) 10,197 8,324 11,852 Other liabilities 65,889 65,889 58,445 Total liabilities 1,431,800 1,536,628 1,454,433 Stockholders’ equity: Preferred stock — — — Common stock 1,187 1,187 1,180 Additional paid-in capital 1,553,875 1,553,875 1,558,403 Accumulated deficit (138,785 ) (507,900 ) (599,409 ) Accumulated other comprehensive loss (95,108 ) (93,780 ) (85,585 ) Total stockholders’ equity 1,321,169 953,382 874,589 Total liabilities and stockholders’ equity $ 2,752,969 $ 2,490,010 $ 2,329,022 The changes in balance sheet accounts due to the adoption of 606 are due primarily to the following: (1) Up front license recognition under our subscription contracts and billed but uncollected support and subscription receivables that had corresponding deferred revenue, which were included in other current assets prior to our adoption of 606. (2) Contract assets and capitalized commission costs. (3) The tax effect of the accumulated deficit impact related to the acceleration of revenue and deferral of costs (primarily commissions). (4) The long-term portion of unbilled receivables due to the acceleration of license revenue on multi-year subscription contracts and the long-term portion of capitalized commission costs. (5) Refund liability, primarily associated with the annual right to exchange on-premise subscription software described above in Judgments and Estimates . (6) The decrease in deferred revenue recorded to accumulated deficit upon adoption of ASC 606 primarily related to on-premise subscription software licenses. Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, Revenue: License (1) $ 105,322 $ 173,905 $ 119,518 Support and cloud services (1) 187,921 125,483 145,672 Total software revenue 293,243 299,388 265,190 Professional services 41,446 39,369 41,454 Total revenue 334,689 338,757 306,644 Cost of revenue: Cost of license revenue 12,563 12,347 12,114 Cost of support and cloud services revenue 31,197 30,630 34,502 Total cost of software revenue 43,760 42,977 46,616 Cost of professional services revenue 33,592 32,219 36,419 Total cost of revenue (2) 77,352 75,196 83,035 Gross margin 257,337 263,561 223,609 Operating expenses: Sales and marketing (3) 104,218 107,304 99,375 Research and development 60,782 60,782 63,972 General and administrative 37,864 37,864 35,020 Amortization of acquired intangible assets 5,936 5,936 7,821 Restructuring and other charges, net 18,493 18,493 105 Total operating expenses 227,293 230,379 206,293 Operating income 30,044 33,182 17,316 Interest expense (10,276 ) (10,276 ) (10,047 ) Other income (expense), net 655 548 (798 ) Income before income taxes 20,423 23,454 6,471 Provision (benefit) for income taxes (4) (562 ) 4,206 (7,406 ) Net income $ 20,985 $ 19,248 $ 13,877 (1) The reduction in license revenue and increase in support revenue is a result of the support component of subscription licenses which is included in license revenue under ASC 605. Additionally, license revenue decreased by approximately $65 million as a result of the revenue recorded to accumulated deficit, which would have been recognized during the quarter, partially offset by approximately $59 million of upfront license revenue recognition on new and renewal bookings. (2) Cost of revenue under ASC 606 is higher under ASC 606 due to the treatment of deferred professional services costs under the new accounting guidance, partially offset by the timing of revenue recognition under ASC 606 resulting in lower associated royalty costs. (3) Sales and marketing costs are lower under ASC 606 due to the amortization of commissions costs capitalized upon adoption of ASC 606, offset by the deferral of ongoing commission expenses under the new accounting guidance. (4) The benefit for income taxes under ASC 606 includes indirect effects of the adoption. |
Restructuring and Other Charges
Restructuring and Other Charges | 3 Months Ended |
Dec. 29, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Charges | Restructuring and Other Charges Restructuring and other charges, net includes restructuring charges (credits) and headquarters relocation charges. Restructuring Charges (Credits) In October 2018, we initiated a restructuring plan to realign our workforce to shift investment to support Industrial Internet of Things and Augmented Reality strategic high growth opportunities. As this is a realignment of resources rather than a cost-savings initiative, we do not expect this realignment to result in significant cost savings. The restructuring plan was completed in the first quarter of 2019 and resulted in restructuring charges of $16.3 million for termination benefits associated with approximately 240 employees, substantially all of which we expect will be paid in fiscal 2019. We also recorded $0.3 million of charges related to prior restructuring actions. The following table summarizes restructuring accrual activity for the three months ended December 29, 2018 : Employee severance and related benefits Facility closures and related costs Total (in thousands) October 1, 2018 $ — $ 2,415 $ 2,415 Charges to operations, net 16,343 243 16,586 Cash disbursements (8,019 ) (264 ) (8,283 ) Foreign exchange impact 32 (59 ) (27 ) Accrual, December 29, 2018 $ 8,356 $ 2,335 $ 10,691 The following table summarizes restructuring accrual activity for the three months ended December 30, 2017 : Employee severance and related benefits Facility closures and related costs Total (in thousands) October 1, 2017 $ 1,736 $ 4,508 $ 6,244 Charges (credit) to operations, net (212 ) 317 105 Cash disbursements (198 ) (537 ) (735 ) Foreign exchange impact 17 (18 ) (1 ) Accrual, December 30, 2017 $ 1,343 $ 4,270 $ 5,613 Of the accrual for facility closures and related costs, as of December 29, 2018, $1.3 million is included in accrued expenses and other current liabilities and $1.0 million is included in other liabilities in the Consolidated Balance Sheets. The accrual for facility closures is net of assumed sublease income of $1.9 million . The accrual for employee severance and related benefits is included in accrued compensation and benefits in the Consolidated Balance Sheets. Of the accrual for facility closures and related costs, as of December 30, 2017 $2.2 million is included in accrued expenses and other current liabilities and $2.1 million is included in other liabilities in the Consolidated Balance Sheets. Other - Headquarters Relocation Charges Headquarters relocation charges represent accelerated depreciation expense associated with exiting our Needham headquarters facility and relocating to our new worldwide headquarters in the Boston Seaport District, which occurred in January 2019. Because our prior headquarters lease will not expire until November 2022, we are seeking to sublease that space, but have not yet done so. As a result, we will bear overlapping rent obligations for those premises and, in the second quarter of 2019, we expect to incur a restructuring charge of approximately $24 million , based on the net present value of remaining lease commitments net of estimated sublease income. From a cash perspective, the free rent and estimated sublease income on the Seaport headquarters total approximately $30 million , as compared to the estimated cash outflows of $29 million on the prior headquarters (rent obligations and operating expenses net of estimated sublease income). Restructuring charges could increase and estimated cash outflows could increase if we are unable to sublease our prior headquarters as we expect. Additionally, we will incur other costs associated with the move which will be recorded as incurred. In the first quarter of 2019 we recorded $1.9 million of accelerated depreciation expense related to shortening the estimated useful lives of leasehold improvements related to the Needham location. |
Stock-based Compensation
Stock-based Compensation | 3 Months Ended |
Dec. 29, 2018 | |
Share-based Compensation, Allocation and Classification in Financial Statements [Abstract] | |
Stock-Based Compensation | Stock-based Compensation Our equity incentive plan provides for grants of nonqualified and incentive stock options, common stock, restricted stock, restricted stock units (RSUs) and stock appreciation rights to employees, directors, officers and consultants. We award RSUs as the principal equity incentive awards, including performance-based awards that are earned based on achievement of performance criteria established by the Compensation Committee of our Board of Directors. Each RSU represents the contingent right to receive one share of our common stock. We measure the cost of employee services received in exchange for RSU awards based on the fair value of RSU awards on the date of grant. That cost is recognized over the period during which an employee is required to provide service in exchange for the award. We account for forfeitures as they occur, rather than estimate expected forfeitures. Our employee stock purchase plan (ESPP), initiated in the fourth quarter of 2016, allows eligible employees to contribute up to 10% of their base salary, up to a maximum of $25,000 per year and subject to other plan limitations, toward the purchase of our common stock at a discounted price. The purchase price of the shares on each purchase date is equal to 85% of the lower of the fair market value of our common stock on the first and last trading days of each offering period. The ESPP is qualified under Section 423 of the Internal Revenue Code. We estimate the fair value of each purchase right under the ESPP on the date of grant using the Black-Scholes option valuation model and use the straight-line attribution approach to record the expense over the six-month offering period. Restricted stock unit activity for the three months ended December 29, 2018 Shares Weighted Average Grant Date Fair Value (Per Share) (in thousands) Balance of outstanding restricted stock units October 1, 2018 3,284 $ 65.93 Granted (1) 979 $ 81.34 Vested (1,056 ) $ 53.40 Forfeited or not earned (266 ) $ 63.60 Balance of outstanding restricted stock units December 29, 2018 2,941 $ 75.85 _________________ (1) Restricted stock granted includes 141,000 shares from prior period TSR awards that were earned upon achievement of the performance criteria and vested in November 2018. Restricted Stock Units Grant Period Performance-based RSUs (1) Service-based RSUs (2) (Number of Units in thousands) First three months of 2019 344 494 _________________ (1) Substantially all the performance-based RSUs were granted to our executive officers. Approximately 145,000 shares are eligible to vest based upon annual performance measures over a three -year period. RSUs not earned for a period may be earned in the third period. To the extent earned, those performance-based RSUs will vest in three substantially equal installments on November 15, 2019, November 15, 2020 and November 15, 2021, or the date the Compensation Committee determines the extent to which the applicable performance criteria have been achieved for each performance period. An additional 199,000 performance-based RSU's are eligible to vest based upon a 2019 performance measure, which RSUs will be forfeited to the extend the performance measure is not achieved. These RSUs will vest, to the extent earned, in three substantially equal installments on November 15, 2019, 2020 and 2021. (2) The service-based RSUs were granted to employees, including our executive officers. Substantially all service-based RSUs will vest in three substantially equal annual installments on or about the anniversary of the date of grant. Compensation expense recorded for our stock-based awards was classified in our Consolidated Statements of Operations as follows: Three months ended December 29, December 30, (in thousands) Cost of license revenue $ 322 $ (90 ) Cost of support and cloud services revenue 975 1,311 Cost of professional services revenue 1,814 1,706 Sales and marketing 9,722 4,879 Research and development 4,900 2,960 General and administrative 11,674 7,565 Total stock-based compensation expense $ 29,407 $ 18,331 Stock-based compensation expense in the first quarter of 2019 and 2018 includes $1.3 million and $1.1 million , respectively, related to the ESPP. |
Earnings per Share (EPS) and Co
Earnings per Share (EPS) and Common Stock | 3 Months Ended |
Dec. 29, 2018 | |
Earnings Per Share and Common Stock | |
Earnings per Share (EPS) and Common Stock | Earnings per Share (EPS) and Common Stock EPS Basic EPS is calculated by dividing net income by the weighted average number of shares outstanding during the period. Diluted EPS is calculated by dividing net income by the weighted average number of shares outstanding plus the dilutive effect, if any, of outstanding RSUs using the treasury stock method. The calculation of the dilutive effect of outstanding equity awards under the treasury stock method includes consideration of unrecognized compensation expense as additional proceeds. Three months ended Calculation of Basic and Diluted EPS December 29, December 30, (in thousands, except per share data) Net income $ 20,985 $ 13,877 Weighted average shares outstanding—Basic 118,323 115,731 Dilutive effect of restricted stock units 1,315 1,925 Weighted average shares outstanding—Diluted 119,638 117,656 Earnings per share—Basic $ 0.18 $ 0.12 Earnings per share—Diluted $ 0.18 $ 0.12 There were no antidilutive shares for the three months ended December 29, 2018 and 0.3 million of antidilutive shares for the three months ended December 30, 2017 . Common Stock Repurchases Our Articles of Organization authorize us to issue up to 500 million shares of our common stock. Our Board of Directors has authorized us to repurchase up to $1,500 million of our common stock in the period October 1, 2017 through September 30, 2020. We did not repurchase any shares in the first quarter of either 2019 or 2018, but resumed repurchases in the second quarter of 2019 as described in Note 15. Subsequent Events . All shares of our common stock repurchased are automatically restored to the status of authorized and unissued. |
Acquisitions
Acquisitions | 3 Months Ended |
Dec. 29, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Acquisition-related costs in the first quarter of 2019 totaled $0.4 million , compared to less than $ 0.1 million in the first quarter of 2018. Acquisition-related costs include direct costs of potential and completed acquisitions (e.g., investment banker fees and professional fees, including legal and valuation services) and expenses related to acquisition integration activities (e.g., professional fees and severance). In addition, subsequent adjustments to our initial estimated amount of contingent consideration associated with specific acquisitions are included within acquisition-related charges. These costs are classified in general and administrative expenses in the accompanying Consolidated Statements of Operations. Frustum On November 19, 2018, we acquired Frustum Inc. for $69.6 million (net of cash acquired of $0.7 million ). We financed the acquisition with borrowings under our credit facility. Frustum is engaged in next-generation computer-aided design, including generative design, an approach that leverages artificial intelligence to generate design options. At the time of the acquisition, Frustum had approximately 12 employees and historical annualized revenues were not material. We do not expect the acquisition to add material revenue in fiscal 2019. The acquisition of Frustum has been accounted for as a business combination. Assets acquired and liabilities assumed have been recorded at their estimated fair values as of the acquisition date. The fair values of intangible assets were based on valuations using a discounted cash flow model which requires the use of significant estimates and assumptions, including estimating future revenues and costs. The excess of the purchase price over the tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill. The purchase price allocation resulted in $53.8 million of goodwill, $17.9 million of purchased software and $2.1 million of other net liabilities. The acquired technology is being amortized over a useful life of 15 years based on the expected benefit pattern of the assets. The acquired goodwill was allocated to our software products segment and will not be deductible for income tax purposes. The resulting amount of goodwill reflects the expected value that will be created by integrating Frustum generative design technology into our CAD solutions. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Dec. 29, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets We have two operating and reportable segments: (1) Software Products and (2) Professional Services. We assess goodwill for impairment at the reporting unit level. Our reporting units are determined based on the components of our operating segments that constitute a business for which discrete financial information is available and for which operating results are regularly reviewed by segment management. Our reporting units are the same as our operating segments. As of December 29, 2018 , goodwill and acquired intangible assets in the aggregate attributable to our Software Products segment was $1,405.9 million and our Professional Services segment was $30.1 million . As of September 30, 2018 , goodwill and acquired intangible assets in the aggregate attributable to our Software Products segment was $1,352.4 million and our Professional Services segment was $30.2 million . Acquired intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. We completed our annual goodwill impairment review as of June 30, 2018 based on a qualitative assessment. Our qualitative assessment included company specific (financial performance and long-range plans), industry, and macroeconomic factors, and consideration of the fair value of each reporting unit relative to its carrying value at the last valuation date. Based on our qualitative assessment, we believe it is more likely than not that the fair values of our reporting units exceed their carrying values and no further impairment testing is required. Goodwill and acquired intangible assets consisted of the following: December 29, 2018 September 30, 2018 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value (in thousands) Goodwill (not amortized) $ 1,230,901 $ 1,182,457 Intangible assets with finite lives (amortized) (1): Purchased software $ 379,653 $ 259,850 $ 119,803 $ 362,679 $ 254,059 $ 108,620 Capitalized software 22,877 22,877 — 22,877 22,877 — Customer lists and relationships 355,412 274,239 81,173 357,586 270,272 87,314 Trademarks and trade names 18,987 14,879 4,108 19,054 14,786 4,268 Other 3,981 3,981 — 4,003 4,003 — $ 780,910 $ 575,826 $ 205,084 $ 766,199 $ 565,997 $ 200,202 Total goodwill and acquired intangible assets $ 1,435,985 $ 1,382,659 (1) The weighted-average useful lives of purchased software, customer lists and relationships, and trademarks and trade names with a remaining net book value are 10 years, 10 years, and 11 years, respectively. Goodwill Changes in goodwill presented by reportable segments were as follows: Software Products Professional Services Total (in thousands) Balance, October 1, 2018 $ 1,152,720 $ 29,737 $ 1,182,457 Frustum acquisition 53,777 — 53,777 Foreign currency translation adjustment (5,199 ) (134 ) (5,333 ) Balance, December 29, 2018 $ 1,201,298 $ 29,603 $ 1,230,901 Amortization of Intangible Assets The aggregate amortization expense for intangible assets with finite lives was classified in our Consolidated Statements of Operations as follows: Three months ended December 29, December 30, (in thousands) Amortization of acquired intangible assets $ 5,936 $ 7,821 Cost of license revenue 6,717 6,675 Total amortization expense $ 12,653 $ 14,496 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Dec. 29, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and consider assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance. GAAP prescribes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs that may be used to measure fair value: • Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities; • Level 2: inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; or • Level 3: unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Money market funds, time deposits and corporate notes/bonds are classified within Level 1 of the fair value hierarchy because they are valued based on quoted market prices in active markets. Certificates of deposit, commercial paper and certain U.S. government agency securities are classified within Level 2 of the fair value hierarchy. These instruments are valued based on quoted prices in markets that are not active or based on other observable inputs consisting of market yields, reported trades and broker/dealer quotes. The principal market in which we execute our foreign currency contracts is the institutional market in an over-the-counter environment with a relatively high level of price transparency. The market participants usually are large financial institutions. Our foreign currency contracts’ valuation inputs are based on quoted prices and quoted pricing intervals from public data sources and do not involve management judgment. These contracts are typically classified within Level 2 of the fair value hierarchy. The fair value of our contingent consideration arrangements is determined based on our evaluation of the probability and amount of any earn-out that will be achieved based on expected future performances by the acquired entities. These arrangements are classified within Level 3 of the fair value hierarchy. Our significant financial assets and liabilities measured at fair value on a recurring basis as of December 29, 2018 and September 30, 2018 were as follows: December 29, 2018 Level 1 Level 2 Level 3 Total (in thousands) Financial assets: Cash equivalents $ 89,023 $ — $ — $ 89,023 Marketable securities Certificates of deposit — 220 — 220 Commercial paper — 1,956 — 1,956 Corporate notes/bonds 52,480 — — 52,480 U.S. government agency securities — 995 — 995 Forward contracts — 1,216 — 1,216 $ 141,503 $ 4,387 $ — $ 145,890 Financial liabilities: Contingent consideration related to acquisitions $ — $ — $ — $ — Forward contracts — 584 — 584 $ — $ 584 $ — $ 584 September 30, 2018 Level 1 Level 2 Level 3 Total (in thousands) Financial assets: Cash equivalents $ 93,058 $ — $ — $ 93,058 Marketable securities Certificates of deposit — 219 — 219 Corporate notes/bonds 54,737 — — 54,737 U.S. government agency securities — 995 — 995 Forward contracts — 2,889 — 2,889 $ 147,795 $ 4,103 $ — $ 151,898 Financial liabilities: Contingent consideration related to acquisitions $ — $ — $ 1,575 $ 1,575 Forward contracts — 3,419 — 3,419 $ — $ 3,419 $ 1,575 $ 4,994 Changes in the fair value of Level 3 contingent consideration liability associated with our acquisitions were as follows: Contingent Consideration (in thousands) Other Balance, October 1, 2018 $ 1,575 Payment of contingent consideration (1,575 ) Balance, December 29, 2018 $ — Contingent Consideration (in thousands) Kepware Balance, October 1, 2017 $ 8,400 Payment of contingent consideration (3,757 ) Balance, December 30, 2017 $ 4,643 In the Consolidated Balance Sheet as of December 29, 2018 , there is no accrued contingent consideration. In the Consolidated Balance Sheet as of December 30, 2017, there was $4.6 million of the contingent consideration liability included in accrued expenses and other current liabilities. Of the $1.6 million payments in the first three months of 2019 , $1.6 million represents the fair value of the liabilities recorded at the acquisition date and is included in financing activities in the Consolidated Statements of Cash Flows. Of the $3.8 million payments in the first three months of 2018 , $3.2 million represents the fair value of the liabilities recorded at the acquisition date and is included in financing activities in the Consolidated Statements of Cash Flows. |
Marketable Securities
Marketable Securities | 3 Months Ended |
Dec. 29, 2018 | |
Marketable Securities [Abstract] | |
Marketable Securities | Marketable Securities The amortized cost and fair value of marketable securities as of December 29, 2018 and September 30, 2018 were as follows: December 29, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Fair value (in thousands) Certificates of deposit $ 221 $ — $ (1 ) $ 220 Commercial paper 1,961 — (5 ) 1,956 Corporate notes/bonds 52,868 6 (394 ) 52,480 U.S. government agency securities 1,000 — (5 ) 995 $ 56,050 $ 6 $ (405 ) $ 55,651 September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Fair value (in thousands) Certificates of deposit $ 220 $ — $ (1 ) $ 219 Corporate notes/bonds 55,140 — (403 ) 54,737 U.S. government agency securities 1,004 — (9 ) 995 $ 56,364 $ — $ (413 ) $ 55,951 Our investment portfolio consists of certificates of deposit, commercial paper, corporate notes/bonds and government securities that have a maximum maturity of two years. The longer the duration of these securities, the more susceptible they are to changes in market interest rates and bond yields. All unrealized losses are due to changes in market interest rates, bond yields and/or credit ratings. We review our investments to identify and evaluate investments that have an indication of possible impairment. We concluded that, at December 29, 2018 , the unrealized losses were temporary. The following tables summarize the fair value and gross unrealized losses aggregated by category and the length of time that individual securities have been in a continuous unrealized loss position as of December 29, 2018 and September 30, 2018 . December 29, 2018 Less than twelve months Greater than twelve months Total Fair Value Gross unrealized loss Fair Value Gross unrealized loss Fair Value Gross unrealized loss (in thousands) Certificates of deposit $ — $ — $ 220 $ (1 ) $ 220 $ (1 ) Commercial paper 1,956 (5 ) — — 1,956 (5 ) Corporate notes/bonds 22,303 (119 ) 27,695 (275 ) 49,998 (394 ) U.S. government agency securities — — 995 (5 ) 995 (5 ) $ 24,259 $ (124 ) $ 28,910 $ (281 ) $ 53,169 $ (405 ) September 30, 2018 Less than twelve months Greater than twelve months Total Fair Value Gross unrealized loss Fair Value Gross unrealized loss Fair Value Gross unrealized loss (in thousands) Certificates of deposit $ 219 $ (1 ) $ — $ — $ 219 $ (1 ) Corporate notes/bonds 24,067 (70 ) 30,670 (333 ) 54,737 (403 ) U.S. government agency securities — — 995 (9 ) 995 (9 ) $ 24,286 $ (71 ) $ 31,665 $ (342 ) $ 55,951 $ (413 ) The following table presents our available-for-sale marketable securities by contractual maturity date as of December 29, 2018 and September 30, 2018 . December 29, 2018 September 30, 2018 Amortized cost Fair value Amortized cost Fair value (in thousands) (in thousands) Due in one year or less $ 25,544 $ 25,430 $ 25,792 $ 25,670 Due after one year through three years 30,506 30,221 30,572 30,281 $ 56,050 $ 55,651 $ 56,364 $ 55,951 |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Dec. 29, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments Our earnings and cash flows are subject to fluctuations due to changes in foreign currency exchange rates. Our most significant foreign currency exposures relate to Western European countries, Japan, China, Israel, India and Canada. Our foreign currency risk management strategy is principally designed to mitigate the future potential financial impact of changes in the U.S. Dollar value of anticipated transactions and balances denominated in foreign currency, resulting from changes in foreign currency exchange rates. We enter into derivative transactions, specifically foreign currency forward contracts, to manage the exposures to foreign currency exchange risk to reduce earnings volatility. We do not enter into derivatives transactions for trading or speculative purposes. Non-Designated Hedges We hedge our net foreign currency monetary assets and liabilities primarily resulting from foreign currency denominated receivables and payables with foreign exchange forward contracts to reduce the risk that our earnings and cash flows will be adversely affected by changes in foreign currency exchange rates. These contracts have maturities of up to approximately three months. Generally, we do not designate these foreign currency forward contracts as hedges for accounting purposes and changes in the fair value of these instruments are recognized immediately in earnings. Because we enter into forward contracts only as an economic hedge, any gain or loss on the underlying foreign-denominated balance would be offset by the loss or gain on the forward contract. Gains and losses on forward contracts and foreign denominated receivables and payables are included in interest income and other expense, net. As of December 29, 2018 and September 30, 2018 , we had outstanding forward contracts with notional amounts equivalent to the following: Currency Hedged December 29, September 30, (in thousands) Canadian / U.S. Dollar 7,195 7,334 Euro / U.S. Dollar 249,703 297,730 British Pound / U.S. Dollar 7,616 7,074 Israeli Sheqel / U.S. Dollar 7,424 9,778 Japanese Yen / U.S. Dollar 27,810 37,456 Swiss Franc / U.S. Dollar 12,875 11,944 Danish Kroner/ U.S. Dollar 3,067 1,902 Swedish Kronor / U.S. Dollar 13,562 18,207 Chinese Renminbi / U.S. Dollar 8,981 9,010 All other 9,282 5,521 Total $ 347,515 $ 405,956 The following table shows the effect of our non-designated hedges in the Consolidated Statements of Operations for the three months ended December 29, 2018 and December 30, 2017 : Derivatives Not Designated as Hedging Instruments Location of Gain or (Loss) Recognized in Income Net realized and unrealized gain or (loss) (excluding the underlying foreign currency exposure being hedged) Three months ended December 29, December 30, (in thousands) Forward Contracts Interest income and other expense, net $ (987 ) $ 587 In the three months ended December 29, 2018 and December 30, 2017 , foreign currency losses, net were $0.2 million and $1.5 million , respectively. Cash Flow Hedges Our foreign exchange risk management program objective is to identify foreign exchange exposures and implement appropriate hedging strategies to minimize earnings fluctuations resulting from foreign exchange rate movements. We designate certain foreign exchange forward contracts as cash flow hedges of Euro, Yen and SEK denominated intercompany forecasted revenue transactions (supported by third party sales). All foreign exchange forward contracts are carried at fair value on the Consolidated Balance Sheets and the maximum duration of foreign exchange forward contracts is 15 months. Cash flow hedge relationships are designated at inception, and effectiveness is assessed prospectively and retrospectively using regression analysis monthly. As the forward contracts are highly effective in offsetting changes to future cash flows on the hedged transactions, we record the effective portion of changes in these cash flow hedges in accumulated other comprehensive income and subsequently reclassify it into earnings in the period during which the hedged transactions are recognized in earnings. Changes in the fair value of foreign exchange forward contracts due to changes in time value are included in the assessment of effectiveness. Our derivatives are not subject to any credit contingent features. We manage credit risk with counterparties by trading among several counterparties and we review our counterparties’ credit at least quarterly. As of December 29, 2018 and September 30, 2018 , we had outstanding forward contracts designated as cash flow hedges with notional amounts equivalent to the following: Currency Hedged December 29, September 30, (in thousands) Euro / U.S. Dollar $ — $ 8,495 Japanese Yen / U.S. Dollar — 2,193 Swedish Kronor / U.S. Dollar — 1,708 Total $ — $ 12,396 The following table shows the effect of our derivative instruments designated as cash flow hedges in the Consolidated Statements of Operations for the three months ended December 29, 2018 and December 30, 2017 (in thousands): Derivatives Designated as Hedging Instruments Gain or (Loss) Recognized in OCI-Effective Portion Location of Gain or (Loss) Reclassified from OCI into Income-Effective Portion Gain or (Loss) Reclassified from OCI into Income-Effective Portion Location of Gain or (Loss) Recognized-Ineffective Portion Gain or (Loss) Recognized-Ineffective Portion Three months ended Three months ended Three months ended December 29, December 30, December 29, December 30, December 29, December 30, Forward Contracts $ 187 $ (1,044 ) Total software revenue $ 627 $ (655 ) Interest income and other expense, net $ — $ (19 ) As of December 29, 2018 , we estimated that all amounts reported in accumulated other comprehensive income will be reclassified to income within the next twelve months. If an underlying forecast transaction does not occur, or it becomes probable that it will not occur, the related hedge gains and losses on the cash flow hedge would be immediately reclassified to interest income and other expense, net on the Consolidated Statements of Operations. For the three months ended December 29, 2018 and December 30, 2017 , there were no such gains or losses. Net Investment Hedges We translate balance sheet accounts of subsidiaries with foreign functional currencies into the U.S. Dollar using the exchange rate at each balance sheet date. Resulting translation adjustments are reported as a component of accumulated other comprehensive income on the Consolidated Balance Sheet. We designate certain foreign exchange forward contracts as net investment hedges against exposure on translation of balance sheet accounts of Euro functional subsidiaries. Net investment hedges partially offset the impact of foreign currency translation adjustment recorded in accumulated other comprehensive income on the Consolidated Balance Sheet. All foreign exchange forward contracts are carried at fair value on the Consolidated Balance Sheet and the maximum duration of foreign exchange forward contracts is approximately three months. Net investment hedge relationships are designated at inception, and effectiveness is assessed retrospectively on a quarterly basis using net equity position of Euro functional subsidiaries. As the forward contracts are highly effective in offsetting exchange rate exposure, we record changes in these net investment hedges in accumulated other comprehensive income and subsequently reclassify them to foreign currency translation adjustment in accumulated other comprehensive income at the time of forward contract maturity. Changes in the fair value of foreign exchange forward contracts due to changes in time value are excluded from the assessment of effectiveness. Our derivatives are not subject to any credit contingent features. We manage credit risk with counterparties by trading among several counterparties and we review our counterparties’ credit at least quarterly. As of December 29, 2018 and September 30, 2018 , we had outstanding forward contracts designated as net investment hedges with notional amounts equivalent to the following: Currency Hedged December 29, September 30, (in thousands) Euro / U.S. Dollar $ 140,492 $ — Total $ 140,492 $ — The following table shows the effect of our derivative instruments designated as net investment hedges in the Consolidated Statements of Operations for the three months ended December 29, 2018 and December 30, 2017 (in thousands): Derivatives Designated as Hedging Instruments Gain or (Loss) Recognized in OCI-Effective Portion Location of Gain or (Loss) Reclassified from OCI into Income-Effective Portion Gain or (Loss) Reclassified from OCI into Income-Effective Portion Location of Gain or (Loss) Excluded from Effectiveness Testing Gain or (Loss) Recognized-Ineffective Portion Three months ended Three months ended Three months ended December 29, December 30, December 29, December 30, December 29, December 30, Forward Contracts $ (698 ) $ — Accumulated other comprehensive income (loss) $ 773 $ — Interest income and other expense, net $ 486 $ — As of December 29, 2018 , we estimate that all amounts reported in accumulated other comprehensive income will be reclassified to income within the next three months. The following table shows our derivative instruments measured at gross fair value as reflected in the Consolidated Balance Sheets: Fair Value of Derivatives Designated As Hedging Instruments Fair Value of Derivatives Not Designated As Hedging Instruments December 29, September 30, December 29, September 30, (in thousands) (in thousands) Derivative assets (1): Forward Contracts $ 5 $ 440 $ 1,211 $ 2,449 Derivative liabilities (2): Forward Contracts $ 217 $ — $ 367 $ 3,419 (1) As of December 29, 2018 and September 30, 2018, $1,216 thousand and $2,889 thousand, current derivative assets, respectively, are recorded in other current assets, in the Consolidated Balance Sheets. (2) As of December 29, 2018 and September 30, 2018 $584 thousand and $3,419 thousand current derivative liabilities, respectively, are recorded in accrued expenses and other current liabilities in the Consolidated Balance Sheets. Offsetting Derivative Assets and Liabilities We have entered into master netting arrangements that allow net settlements under certain conditions. Although netting is permitted, it is currently our policy and practice to record all derivative assets and liabilities on a gross basis in the Consolidated Balance Sheets. The following table sets forth the offsetting of derivative assets as of December 29, 2018 : Gross Amounts Offset in the Consolidated Balance Sheets Gross Amounts Not Offset in the Consolidated Balance Sheets As of December 29, 2018 Gross Amount of Recognized Assets Gross Amounts Offset in the Consolidated Balance Sheets Net Amounts of Assets Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount (in thousands) Forward Contracts $ 1,216 $ — $ 1,216 $ (584 ) $ — $ 632 The following table sets forth the offsetting of derivative liabilities as of December 29, 2018 : Gross Amounts Offset in the Consolidated Balance Sheets Gross Amounts Not Offset in the Consolidated Balance Sheets As of December 29, 2018 Gross Amount of Recognized Liabilities Gross Amounts Offset in the Consolidated Balance Sheets Net Amounts of Liabilities Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Pledged Net Amount (in thousands) Forward Contracts $ 584 $ — $ 584 $ (584 ) $ — $ — |
Segment Information
Segment Information | 3 Months Ended |
Dec. 29, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Segment and Geographical Information Effective with the beginning of fiscal 2018, we changed our segments, see Note 1. Basis of Presentation for additional information. We operate within a single industry segment -- computer software and related services. Operating segments as defined under GAAP are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is our President and Chief Executive Officer. We have two operating and reportable segments: (1) Software Products, which includes license, subscription and related support revenue (including updates and technical support) for all our products; and (2) Professional Services, which includes consulting, implementation and training services. We do not allocate sales & marketing or general and administrative expense to our operating segments as these activities are managed on a consolidated basis. Additionally, segment profit does not include stock-based compensation, amortization of intangible assets, restructuring charges and certain other identified costs that we do not allocate to the segments for purposes of evaluating their operational performance. The revenue and profit attributable to our operating segments are summarized below. We do not produce asset information by reportable segment; therefore, it is not reported. Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, (in thousands) Software Products Revenue $ 293,243 $ 299,388 $ 265,190 Operating Costs (1) 91,628 90,845 99,732 Profit 201,615 208,543 165,458 Professional Services Revenue 41,446 39,369 41,454 Operating Costs (2) 31,863 30,490 34,817 Profit 9,583 8,879 6,637 Total segment revenue 334,689 338,757 306,644 Total segment costs 123,491 121,335 134,549 Total segment profit 211,198 217,422 172,095 Unallocated operating expenses: Sales and marketing expenses 94,496 97,583 94,496 General and administrative expenses 25,771 25,770 27,448 Restructuring charges, net 16,586 16,586 105 Restructuring and headquarters relocation charges, net 1,907 1,907 — Intangibles amortization 12,653 12,653 14,496 Stock-based compensation 29,407 29,407 18,331 Other unallocated operating expenses (income) (3) 334 334 (97 ) Total operating income 30,044 33,182 17,316 Interest expense (10,276 ) (10,276 ) (10,047 ) Other income (expense), net 655 548 (798 ) Income before income taxes $ 20,423 $ 23,454 $ 6,471 (1) Operating costs for the Software Products segment includes all costs of software revenue and research and development costs, excluding stock-based compensation and intangible amortization. (2) Operating costs for the Professional Services segment includes all cost of professional services revenue, excluding stock-based compensation, intangible amortization and fair value adjustments for deferred services costs. (3) Other unallocated operating expenses include acquisition-related and other transactional costs, pension plan termination-related costs and fair value adjustments for deferred services costs. We report revenue by the following two product groups: Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, (in thousands) Solutions $ 299,434 $ 298,351 $ 277,669 IoT 35,255 40,406 28,975 Total revenue $ 334,689 $ 338,757 $ 306,644 Our international revenue is presented based on the location of our customer. Revenue for the geographic regions in which we operate is presented below. Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, (in thousands) Revenue: Americas $ 141,853 $ 134,897 $ 127,007 Europe 111,352 120,157 121,466 Asia-Pacific 81,484 83,703 58,171 Total revenue $ 334,689 $ 338,757 $ 306,644 |
Income Taxes
Income Taxes | 3 Months Ended |
Dec. 29, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In the first quarter of 2019 , our effective tax rate was (3)% on pre-tax income of $20.4 million , compared to (114)% on pre-tax income of $6.5 million in the first quarter of 2018 . In the first three months of 2019 and 2018 , our effective tax rate was lower than the statutory federal income tax rate of 21% due to U.S. tax reform (as described below), our corporate structure in which our foreign taxes are at a net effective tax rate lower than the U.S. rate, the excess tax benefit related to stock-based compensation and, in the first quarter of 2019, the reduction of a valuation allowance of $1.8 million as the result of the Frustum acquisition. Additionally, in the first quarter of 2019 our effective rate includes the indirect effects of the adoption of ASC 606. A significant amount of our foreign earnings is generated by our subsidiaries organized in Ireland. In 2019 and 2018, the foreign rate differential predominantly relates to these Irish earnings. On December 22, 2017, the United States enacted tax reform legislation through the Tax Cuts and Jobs Act, (the "Tax Act"), which significantly changed existing U.S. tax laws by a reduction of the corporate tax rate, the implementation of a new system of taxation for non-U.S. earnings, the imposition of a one-time tax on the deemed repatriation of undistributed earnings of non-U.S. subsidiaries, and the expansion of the limitations on the deductibility of executive compensation and interest expense. As we have a September 30 fiscal year-end, there is a blended U.S. statutory federal rate of approximately 24.5% for our fiscal year ending September 30, 2018 and 21% for subsequent fiscal years. The Tax Act also provides that net operating losses generated in years ending after December 31, 2017 may be carried forward indefinitely and can no longer be carried back, and that net operating losses generated in years beginning after December 31, 2017 can only reduce taxable income by up to 80% when utilized in a future period. The Tax Act includes a provision to tax global intangible low-tax income (GILTI) of foreign subsidiaries and a base erosion anti-abuse tax (BEAT) measure that taxes certain payments between a U.S. corporation and its foreign subsidiaries. The GILTI and BEAT provisions were effective for us beginning October 1, 2018. Our accounting policy is to treat tax on GILTI as a current period cost included in tax expense in the year incurred. In the first quarter of 2018, we provided no federal income taxes payable as a result of the deemed repatriation of undistributed earnings as the tax was offset by a combination of current year losses and existing attributes which had a full valuation allowance recorded against the related deferred tax assets. We recorded state income taxes payable of $7.1 million on the deemed repatriation. This was subsequently reduced to $1.5 million to reflect additional guidance on the state implications of the Tax Act. We also recorded a deferred tax benefit of $14.2 million for the impact of the Tax Act on our net U.S. deferred income tax balances. This was primarily attributable to the reduction of the federal tax rate on the net deferred tax liability in the U.S., and the ability to realize net operating losses from the reversal of existing deferred tax assets which can now be carried forward indefinitely and can therefore be netted against deferred tax liabilities for indefinite lived intangible assets. The U.S. Securities and Exchange Commission issued rules that allow for a period of up to one year after the enactment date of the Tax Act to finalize the recording of the related tax impacts. We finalized recording the impacts of the Tax Act in the quarter ended December 29, 2018 and did not record any significant adjustments. In October 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. The purpose of ASU 2016-16 is to simplify the income tax accounting of an intra-entity transfer of an asset other than inventory and to record its effect when the transfer occurs. We adopted this amendment beginning in the first quarter of 2019 using the modified retrospective method with a cumulate effect adjustment to accumulated deficit of $72.3 million , with a corresponding increase of $75.3 million to deferred tax assets, $6.0 million decrease to income tax assets and a $3.0 million decrease to income tax liabilities. The adjustment primarily relates to deductible amortization of intangible assets in Ireland. Post adoption, our effective tax rate no longer includes the benefit of this amortization. We have concluded, based on the weight of available evidence, that a full valuation allowance continues to be required against our U.S. net deferred tax assets as they are not more likely than not to be realized in the future. We will continue to reassess our valuation allowance requirements each financial reporting period. In the normal course of business, PTC and its subsidiaries are examined by various taxing authorities, including the Internal Revenue Service in the U.S. We regularly assess the likelihood of additional assessments by tax authorities and provide for these matters as appropriate. We are currently under audit by tax authorities in several jurisdictions. Audits by tax authorities typically involve examination of the deductibility of certain permanent items, limitations on net operating losses and tax credits. Although we believe our tax estimates are appropriate, the final determination of tax audits and any related litigation could result in material changes in our estimates. As of December 29, 2018 and September 30, 2018 , we had unrecognized tax benefits of $10.3 million and $9.8 million , respectively. If all our unrecognized tax benefits as of December 29, 2018 were to become recognizable in the future, we would record a benefit to the income tax provision of $10.3 million , which would be partially offset by an increase in the U.S. valuation allowance of $3.8 million . Although we believe our tax estimates are appropriate, the final determination of tax audits and any related litigation could result in favorable or unfavorable changes in our estimates. We believe it is reasonably possible that within the next 12 months the amount of unrecognized tax benefits related to the resolution of multi-jurisdictional tax positions could be reduced by up to $2 million as audits close and statutes of limitations expire. In the fourth quarter of 2016, we received an assessment of approximately $12 million from the tax authorities in South Korea. The assessment relates to various tax issues, primarily foreign withholding taxes. We have appealed and intend to vigorously defend our positions. We believe that upon completion of a multi-level appeal process it is more likely than not that our positions will be sustained. Accordingly, we have not recorded a tax reserve for this matter. We paid this assessment in the first quarter of 2017 and have recorded the amount in other assets, pending resolution of the appeal process. |
Debt
Debt | 3 Months Ended |
Dec. 29, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Debt At December 29, 2018 and September 30, 2018 , we had the following long-term debt obligations: December 29, September 30, (in thousands) 6.000% Senior notes due 2024 $ 500,000 $ 500,000 Credit facility revolver 283,125 148,125 Total debt 783,125 648,125 Unamortized debt issuance costs for the Senior notes (1) (4,641 ) (4,857 ) Total debt, net of issuance costs (2) $ 778,484 $ 643,268 (1) Unamortized debt issuance costs related to the credit facility were $3.6 million and $3.8 million as of December 29, 2018 and September 30, 2018, respectively, and were included in other assets. (2) As of December 29, 2018 and September 30, 2018, all debt was included in long-term debt. Senior Notes In May 2016, we issued $500 million in aggregate principal amount of 6.0% senior, unsecured long-term debt at par value, due in 2024. We used the net proceeds from the sale of the notes to repay a portion of our outstanding revolving loan under our current credit facility. Interest is payable semi-annually on November 15 and May 15. The debt indenture includes covenants that limit our ability to, among other things, incur additional debt, grant liens on our properties or capital stock, enter into sale and leaseback transactions or asset sales, and make capital distributions. We were in compliance with all the covenants as of December 29, 2018 . On and after May 15, 2019, we may redeem the senior notes at any time in whole or from time to time in part at specified redemption prices. In certain circumstances constituting a change of control, we will be required to make an offer to repurchase the senior notes at a purchase price equal to 101% of the aggregate principal amount of the notes, plus accrued and unpaid interest. Our ability to repurchase the senior notes in such event may be limited by law, by the indenture associated with the senior notes, by our then-available financial resources or by the terms of other agreements to which we may be party at such time. If we fail to repurchase the senior notes as required by the indenture, it would constitute an event of default under the indenture which, in turn, may also constitute an event of default under other obligations. As of December 29, 2018 , the total estimated fair value of the Notes was approximately $503.8 million , based on quoted prices for the notes on that date. Credit Agreement We maintain a multi-currency credit facility with a syndicate of sixteen banks for which JPMorgan Chase Bank, N.A. acts as Administrative Agent. We use the credit facility for general corporate purposes, including acquisitions of businesses, share repurchases and working capital requirements. As of December 29, 2018 , the fair value of our credit facility approximates its book value. In September 2018, we amended and restated the credit facility to increase the revolving loan commitment from $600 million to $700 million and amend other provisions, including replacing the fixed charge coverage ratio with an interest coverage ratio. The revolving loan commitment does not require amortization of principal and may be repaid in whole or in part prior to the scheduled maturity date at our option without penalty or premium. The credit facility matures on September 13, 2023, when all remaining amounts outstanding will be due and payable in full. PTC and certain eligible foreign subsidiaries are eligible to borrow under the credit facility. Any borrowings by PTC Inc. under the credit facility would be guaranteed by PTC Inc.’s material domestic subsidiaries that become parties to the subsidiary guaranty, if any. As of the filing of this Form 10-Q, there are no subsidiary guarantors of the obligations under the credit facility. Any borrowings by eligible foreign subsidiary borrowers would be guaranteed by PTC Inc. and any subsidiary guarantors. As of the filing of this Form 10-Q $90.0 million were borrowed by an eligible foreign subsidiary borrower. In addition, owned property (including equity interests) of PTC and certain of its material domestic subsidiaries' owned property is subject to first priority perfected liens in favor of the lenders under this credit facility. 100% of the voting equity interests of certain of PTC’s domestic subsidiaries and 65% of its material first-tier foreign subsidiaries are pledged as collateral for the obligations under the credit facility. Loans under the credit facility bear interest at variable rates which reset every 30 to 180 days depending on the rate and period selected by PTC as described below. As of December 29, 2018 , the annual rate for borrowings outstanding was 4.2% . Interest rates on borrowings outstanding under the credit facility range from 1.25% to 1.75% above an adjusted LIBO rate for Euro currency borrowings or would range from 0.25% to 0.75% above the defined base rate (the greater of the Prime Rate, the NYFRB rate plus 0.5% , or an adjusted LIBO rate plus 1% ) for base rate borrowings, in each case based upon PTC’s total leverage ratio. Additionally, PTC may borrow certain foreign currencies at rates set in the same range above the respective London interbank offered interest rates for those currencies, based on PTC’s total leverage ratio. A quarterly commitment fee on the undrawn portion of the credit facility is required, ranging from 0.175% to 0.30% per annum based upon PTC’s total leverage ratio. The credit facility limits PTC’s and its subsidiaries’ ability to, among other things: incur liens or guarantee obligations; pay dividends (other than to PTC) and make other distributions; make investments and enter into joint ventures; dispose of assets; and engage in transactions with affiliates, except on an arms-length basis. Under the credit facility, PTC and its material domestic subsidiaries may not invest cash or property in, or loan to, PTC’s foreign subsidiaries in aggregate amounts exceeding $100.0 million for any purpose and an additional $200.0 million for acquisitions of businesses. In addition, under the credit facility, PTC and its subsidiaries must maintain the following financial ratios: • a total leverage ratio, defined as consolidated funded indebtedness to consolidated trailing four quarters EBITDA, not to exceed 4.50 to 1.00 as of the last day of any fiscal quarter; • a senior secured leverage ratio, defined as senior consolidated total indebtedness (which excludes unsecured indebtedness) to the consolidated trailing four quarters EBITDA, not to exceed 3.00 to 1.00 as of the last day of any fiscal quarter; and • an interest coverage ratio, defined as the ratio of consolidated trailing four quarters EBITDA to consolidated trailing four quarters of cash basis interest expense, of not less than 3.00 to 1.00 as of the last day of any fiscal quarter. As of December 29, 2018 , our total leverage ratio was 2.30 to 1.00 , our senior secured leverage ratio was 0.86 to 1.00 and our interest coverage ratio was 7.24 to 1.00 and we were in compliance with all financial and operating covenants of the credit facility. Any failure to comply with the financial or operating covenants of the credit facility would prevent PTC from being able to borrow additional funds, and would constitute a default, permitting the lenders to, among other things, accelerate the amounts outstanding, including all accrued interest and unpaid fees, under the credit facility and to terminate the credit facility. A change in control of PTC, as defined in the agreement, also constitutes an event of default, permitting the lenders to accelerate the indebtedness and terminate the credit facility. We incurred $2.9 million in financing costs in connection with the September 2018 credit facility amendment and restatement. These origination costs are recorded as deferred debt issuance costs and are included in other assets. Financing costs are expensed over the remaining term of the obligations . In both the first quarter of 2019 and 2018, we paid $16.7 million of interest on our debt. The average interest rate on borrowings outstanding during the first quarter of 2019 and 2018 was approximately 5.4% and 5.0% , respectively. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Dec. 29, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal and Regulatory Matters Korean Tax Audit In July 2016, we received an assessment of approximately $12 million from the tax authorities in Korea related to an ongoing tax audit. See Note 12. Income Taxes for additional information. Legal Proceedings We are subject to various other legal proceedings and claims that arise in the ordinary course of business. We do not believe that resolving the legal proceedings and claims that we are currently subject to will have a material adverse impact on our financial condition, results of operations or cash flows. However, the results of legal proceedings cannot be predicted with certainty. Should any of these legal proceedings and claims be resolved against us, the operating results for a reporting period could be adversely affected. Accruals With respect to legal proceedings and claims, we record an accrual for a contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. For legal proceedings and claims for which the likelihood that a liability has been incurred is more than remote but less than probable, we estimate the range of possible outcomes. As of December 29, 2018 , we estimate approximately $0.5 million to $4.2 million in legal proceedings and claims, of which we had accrued $0.4 million . Guarantees and Indemnification Obligations We enter into standard indemnification agreements in the ordinary course of our business. Under such agreements with our business partners or customers, we indemnify, hold harmless, and agree to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally in connection with patent, copyright or other intellectual property infringement claims by any third party with respect to our products, claims relating to property damage or personal injury resulting from the performance of services by us or our subcontractors and data breaches. The maximum potential amount of future payments we could be required to make under indemnification agreements for intellectual property and damage and injury claims is unlimited; the maximum potential amount for indemnification for data breaches is capped in those contracts. Historically, our costs to defend lawsuits or settle claims relating to such indemnity agreements have been minimal and, accordingly, we believe the estimated fair value of liabilities under these agreements is immaterial. We warrant that our software products will perform in all material respects in accordance with our standard published specifications in effect at the time of delivery of the licensed products for a specified period of time. Additionally, we generally warrant that our consulting services will be performed consistent with generally accepted industry standards. In most cases, liability for these warranties is capped. If necessary, we would provide for the estimated cost of product and service warranties based on specific warranty claims and claim history; however, we have not incurred significant cost under our product or services warranties. As a result, we believe the estimated fair value of these liabilities is immaterial. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Dec. 29, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Restructuring In the second quarter of 2019, we will record a restructuring charge related to our move to our new headquarters facility. See Note 3. Restructuring and Other Charges for further discussion. Debt Repayment In January 2019, we repaid $25.0 million under our revolving credit facility. Common Stock Repurchases In the second quarter of 2019, we resumed our share repurchase program. We expect to repurchase approximately $65 million of our common stock in the quarter. Departure of Executive Officer On January 23, 2019, we announced that Andy Miller, our Executive Vice President and Chief Financial Officer, will be retiring in 2019. The effective date of his departure is not known at this time, and is expected to occur after a successor has been appointed. His departure may have an impact on the timing and amount of stock-based compensation expense for outstanding unvested awards. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Contract with Customer, Asset and Liability [Table Text Block] | December 29, 2018 October 1, 2018, as adjusted (in thousands) Contract asset $ 14,513 $ 26,265 Deferred revenue $ 335,119 $ 357,490 |
Disaggregation of Revenue [Table Text Block] | Disaggregation of Revenue Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, 2018 December 29, 2018 December 30, 2017 Revenue (in thousands) Subscription license $ 63,517 Subscription support & cloud services 77,424 Total Subscription 140,941 $ 148,413 $ 100,008 Perpetual support 110,497 109,225 131,197 Total recurring revenue 251,438 257,638 231,205 Perpetual license 41,805 41,750 33,985 Total software revenue 293,243 299,388 265,190 Professional services 41,446 39,369 41,454 Total revenue $ 334,689 $ 338,757 $ 306,644 |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | The following tables present our Balance Sheets and Statements of Operations as reported under ASC 606 for the current period with comparative periods reported under ASC 605: As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, September 30, ASSETS Current assets: Cash and cash equivalents $ 276,990 $ 276,990 $ 259,946 Short-term marketable securities 25,598 25,598 25,836 Accounts receivable (1) 385,670 138,989 129,297 Prepaid expenses 63,045 63,045 48,997 Other current assets (2) 48,682 143,104 169,708 Total current assets 799,985 647,726 633,784 Property and equipment, net 107,359 107,359 80,613 Goodwill 1,230,901 1,230,901 1,182,457 Acquired intangible assets, net 205,084 205,084 200,202 Long-term marketable securities 30,054 30,054 30,115 Deferred tax assets (3) 201,149 234,558 165,566 Other assets (4) 178,437 34,328 36,285 Total assets $ 2,752,969 $ 2,490,010 $ 2,329,022 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 57,249 $ 57,249 $ 53,473 Accrued expenses and other current liabilities (5) 83,721 56,897 74,388 Accrued compensation and benefits 74,483 74,483 101,784 Accrued income taxes (3) 405 4,958 18,044 Deferred revenue (6) 325,111 484,613 487,590 Total current liabilities 540,969 678,200 735,279 Long-term debt 778,484 778,484 643,268 Deferred tax liabilities (3) 36,261 5,731 5,589 Deferred revenue (6) 10,197 8,324 11,852 Other liabilities 65,889 65,889 58,445 Total liabilities 1,431,800 1,536,628 1,454,433 Stockholders’ equity: Preferred stock — — — Common stock 1,187 1,187 1,180 Additional paid-in capital 1,553,875 1,553,875 1,558,403 Accumulated deficit (138,785 ) (507,900 ) (599,409 ) Accumulated other comprehensive loss (95,108 ) (93,780 ) (85,585 ) Total stockholders’ equity 1,321,169 953,382 874,589 Total liabilities and stockholders’ equity $ 2,752,969 $ 2,490,010 $ 2,329,022 The changes in balance sheet accounts due to the adoption of 606 are due primarily to the following: (1) Up front license recognition under our subscription contracts and billed but uncollected support and subscription receivables that had corresponding deferred revenue, which were included in other current assets prior to our adoption of 606. (2) Contract assets and capitalized commission costs. (3) The tax effect of the accumulated deficit impact related to the acceleration of revenue and deferral of costs (primarily commissions). (4) The long-term portion of unbilled receivables due to the acceleration of license revenue on multi-year subscription contracts and the long-term portion of capitalized commission costs. (5) Refund liability, primarily associated with the annual right to exchange on-premise subscription software described above in Judgments and Estimates . (6) The decrease in deferred revenue recorded to accumulated deficit upon adoption of ASC 606 primarily related to on-premise subscription software licenses. Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, Revenue: License (1) $ 105,322 $ 173,905 $ 119,518 Support and cloud services (1) 187,921 125,483 145,672 Total software revenue 293,243 299,388 265,190 Professional services 41,446 39,369 41,454 Total revenue 334,689 338,757 306,644 Cost of revenue: Cost of license revenue 12,563 12,347 12,114 Cost of support and cloud services revenue 31,197 30,630 34,502 Total cost of software revenue 43,760 42,977 46,616 Cost of professional services revenue 33,592 32,219 36,419 Total cost of revenue (2) 77,352 75,196 83,035 Gross margin 257,337 263,561 223,609 Operating expenses: Sales and marketing (3) 104,218 107,304 99,375 Research and development 60,782 60,782 63,972 General and administrative 37,864 37,864 35,020 Amortization of acquired intangible assets 5,936 5,936 7,821 Restructuring and other charges, net 18,493 18,493 105 Total operating expenses 227,293 230,379 206,293 Operating income 30,044 33,182 17,316 Interest expense (10,276 ) (10,276 ) (10,047 ) Other income (expense), net 655 548 (798 ) Income before income taxes 20,423 23,454 6,471 Provision (benefit) for income taxes (4) (562 ) 4,206 (7,406 ) Net income $ 20,985 $ 19,248 $ 13,877 (1) The reduction in license revenue and increase in support revenue is a result of the support component of subscription licenses which is included in license revenue under ASC 605. Additionally, license revenue decreased by approximately $65 million as a result of the revenue recorded to accumulated deficit, which would have been recognized during the quarter, partially offset by approximately $59 million of upfront license revenue recognition on new and renewal bookings. (2) Cost of revenue under ASC 606 is higher under ASC 606 due to the treatment of deferred professional services costs under the new accounting guidance, partially offset by the timing of revenue recognition under ASC 606 resulting in lower associated royalty costs. (3) Sales and marketing costs are lower under ASC 606 due to the amortization of commissions costs capitalized upon adoption of ASC 606, offset by the deferral of ongoing commission expenses under the new accounting guidance. (4) The benefit for income taxes under ASC 606 includes indirect effects of the adoption. |
Restructuring and Other Charg_2
Restructuring and Other Charges (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | The following table summarizes restructuring accrual activity for the three months ended December 29, 2018 : Employee severance and related benefits Facility closures and related costs Total (in thousands) October 1, 2018 $ — $ 2,415 $ 2,415 Charges to operations, net 16,343 243 16,586 Cash disbursements (8,019 ) (264 ) (8,283 ) Foreign exchange impact 32 (59 ) (27 ) Accrual, December 29, 2018 $ 8,356 $ 2,335 $ 10,691 The following table summarizes restructuring accrual activity for the three months ended December 30, 2017 : Employee severance and related benefits Facility closures and related costs Total (in thousands) October 1, 2017 $ 1,736 $ 4,508 $ 6,244 Charges (credit) to operations, net (212 ) 317 105 Cash disbursements (198 ) (537 ) (735 ) Foreign exchange impact 17 (18 ) (1 ) Accrual, December 30, 2017 $ 1,343 $ 4,270 $ 5,613 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Share-based Compensation, Allocation and Classification in Financial Statements [Abstract] | |
Schedule of Restricted Stock and Restricted Stock Unit Activity | Restricted stock unit activity for the three months ended December 29, 2018 Shares Weighted Average Grant Date Fair Value (Per Share) (in thousands) Balance of outstanding restricted stock units October 1, 2018 3,284 $ 65.93 Granted (1) 979 $ 81.34 Vested (1,056 ) $ 53.40 Forfeited or not earned (266 ) $ 63.60 Balance of outstanding restricted stock units December 29, 2018 2,941 $ 75.85 _________________ (1) Restricted stock granted includes 141,000 shares from prior period TSR awards that were earned upon achievement of the performance criteria and vested in November 2018. |
Schedule of Restricted Stock Unit Grants for the Period | Restricted Stock Units Grant Period Performance-based RSUs (1) Service-based RSUs (2) (Number of Units in thousands) First three months of 2019 344 494 _________________ (1) Substantially all the performance-based RSUs were granted to our executive officers. Approximately 145,000 shares are eligible to vest based upon annual performance measures over a three -year period. RSUs not earned for a period may be earned in the third period. To the extent earned, those performance-based RSUs will vest in three substantially equal installments on November 15, 2019, November 15, 2020 and November 15, 2021, or the date the Compensation Committee determines the extent to which the applicable performance criteria have been achieved for each performance period. An additional 199,000 performance-based RSU's are eligible to vest based upon a 2019 performance measure, which RSUs will be forfeited to the extend the performance measure is not achieved. These RSUs will vest, to the extent earned, in three substantially equal installments on November 15, 2019, 2020 and 2021. (2) The service-based RSUs were granted to employees, including our executive officers. Substantially all service-based RSUs will vest in three substantially equal annual installments on or about the anniversary of the date of grant. |
Schedule of Classification of Compensation Expense | Compensation expense recorded for our stock-based awards was classified in our Consolidated Statements of Operations as follows: Three months ended December 29, December 30, (in thousands) Cost of license revenue $ 322 $ (90 ) Cost of support and cloud services revenue 975 1,311 Cost of professional services revenue 1,814 1,706 Sales and marketing 9,722 4,879 Research and development 4,900 2,960 General and administrative 11,674 7,565 Total stock-based compensation expense $ 29,407 $ 18,331 |
Earnings per Share (EPS) and _2
Earnings per Share (EPS) and Common Stock (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Earnings Per Share and Common Stock | |
Earnings per Share Basic and Diluted | Three months ended Calculation of Basic and Diluted EPS December 29, December 30, (in thousands, except per share data) Net income $ 20,985 $ 13,877 Weighted average shares outstanding—Basic 118,323 115,731 Dilutive effect of restricted stock units 1,315 1,925 Weighted average shares outstanding—Diluted 119,638 117,656 Earnings per share—Basic $ 0.18 $ 0.12 Earnings per share—Diluted $ 0.18 $ 0.12 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Acquired Intangible Assets | Goodwill and acquired intangible assets consisted of the following: December 29, 2018 September 30, 2018 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value (in thousands) Goodwill (not amortized) $ 1,230,901 $ 1,182,457 Intangible assets with finite lives (amortized) (1): Purchased software $ 379,653 $ 259,850 $ 119,803 $ 362,679 $ 254,059 $ 108,620 Capitalized software 22,877 22,877 — 22,877 22,877 — Customer lists and relationships 355,412 274,239 81,173 357,586 270,272 87,314 Trademarks and trade names 18,987 14,879 4,108 19,054 14,786 4,268 Other 3,981 3,981 — 4,003 4,003 — $ 780,910 $ 575,826 $ 205,084 $ 766,199 $ 565,997 $ 200,202 Total goodwill and acquired intangible assets $ 1,435,985 $ 1,382,659 (1) The weighted-average useful lives of purchased software, customer lists and relationships, and trademarks and trade names with a remaining net book value are 10 years, 10 years, and 11 years, respectively. |
Schedule of Goodwill | Changes in goodwill presented by reportable segments were as follows: Software Products Professional Services Total (in thousands) Balance, October 1, 2018 $ 1,152,720 $ 29,737 $ 1,182,457 Frustum acquisition 53,777 — 53,777 Foreign currency translation adjustment (5,199 ) (134 ) (5,333 ) Balance, December 29, 2018 $ 1,201,298 $ 29,603 $ 1,230,901 |
Amortization of Intangible Assets | The aggregate amortization expense for intangible assets with finite lives was classified in our Consolidated Statements of Operations as follows: Three months ended December 29, December 30, (in thousands) Amortization of acquired intangible assets $ 5,936 $ 7,821 Cost of license revenue 6,717 6,675 Total amortization expense $ 12,653 $ 14,496 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value, by Balance Sheet Grouping | Our significant financial assets and liabilities measured at fair value on a recurring basis as of December 29, 2018 and September 30, 2018 were as follows: December 29, 2018 Level 1 Level 2 Level 3 Total (in thousands) Financial assets: Cash equivalents $ 89,023 $ — $ — $ 89,023 Marketable securities Certificates of deposit — 220 — 220 Commercial paper — 1,956 — 1,956 Corporate notes/bonds 52,480 — — 52,480 U.S. government agency securities — 995 — 995 Forward contracts — 1,216 — 1,216 $ 141,503 $ 4,387 $ — $ 145,890 Financial liabilities: Contingent consideration related to acquisitions $ — $ — $ — $ — Forward contracts — 584 — 584 $ — $ 584 $ — $ 584 September 30, 2018 Level 1 Level 2 Level 3 Total (in thousands) Financial assets: Cash equivalents $ 93,058 $ — $ — $ 93,058 Marketable securities Certificates of deposit — 219 — 219 Corporate notes/bonds 54,737 — — 54,737 U.S. government agency securities — 995 — 995 Forward contracts — 2,889 — 2,889 $ 147,795 $ 4,103 $ — $ 151,898 Financial liabilities: Contingent consideration related to acquisitions $ — $ — $ 1,575 $ 1,575 Forward contracts — 3,419 — 3,419 $ — $ 3,419 $ 1,575 $ 4,994 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | Changes in the fair value of Level 3 contingent consideration liability associated with our acquisitions were as follows: Contingent Consideration (in thousands) Other Balance, October 1, 2018 $ 1,575 Payment of contingent consideration (1,575 ) Balance, December 29, 2018 $ — Contingent Consideration (in thousands) Kepware Balance, October 1, 2017 $ 8,400 Payment of contingent consideration (3,757 ) Balance, December 30, 2017 $ 4,643 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Marketable Securities [Abstract] | |
Marketable Securities | The amortized cost and fair value of marketable securities as of December 29, 2018 and September 30, 2018 were as follows: December 29, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Fair value (in thousands) Certificates of deposit $ 221 $ — $ (1 ) $ 220 Commercial paper 1,961 — (5 ) 1,956 Corporate notes/bonds 52,868 6 (394 ) 52,480 U.S. government agency securities 1,000 — (5 ) 995 $ 56,050 $ 6 $ (405 ) $ 55,651 September 30, 2018 Amortized cost Gross unrealized gains Gross unrealized losses Fair value (in thousands) Certificates of deposit $ 220 $ — $ (1 ) $ 219 Corporate notes/bonds 55,140 — (403 ) 54,737 U.S. government agency securities 1,004 — (9 ) 995 $ 56,364 $ — $ (413 ) $ 55,951 |
Unrealized Gain (Loss) on Investments | The following tables summarize the fair value and gross unrealized losses aggregated by category and the length of time that individual securities have been in a continuous unrealized loss position as of December 29, 2018 and September 30, 2018 . December 29, 2018 Less than twelve months Greater than twelve months Total Fair Value Gross unrealized loss Fair Value Gross unrealized loss Fair Value Gross unrealized loss (in thousands) Certificates of deposit $ — $ — $ 220 $ (1 ) $ 220 $ (1 ) Commercial paper 1,956 (5 ) — — 1,956 (5 ) Corporate notes/bonds 22,303 (119 ) 27,695 (275 ) 49,998 (394 ) U.S. government agency securities — — 995 (5 ) 995 (5 ) $ 24,259 $ (124 ) $ 28,910 $ (281 ) $ 53,169 $ (405 ) September 30, 2018 Less than twelve months Greater than twelve months Total Fair Value Gross unrealized loss Fair Value Gross unrealized loss Fair Value Gross unrealized loss (in thousands) Certificates of deposit $ 219 $ (1 ) $ — $ — $ 219 $ (1 ) Corporate notes/bonds 24,067 (70 ) 30,670 (333 ) 54,737 (403 ) U.S. government agency securities — — 995 (9 ) 995 (9 ) $ 24,286 $ (71 ) $ 31,665 $ (342 ) $ 55,951 $ (413 ) |
Investments Classified by Contractual Maturity Date | The following table presents our available-for-sale marketable securities by contractual maturity date as of December 29, 2018 and September 30, 2018 . December 29, 2018 September 30, 2018 Amortized cost Fair value Amortized cost Fair value (in thousands) (in thousands) Due in one year or less $ 25,544 $ 25,430 $ 25,792 $ 25,670 Due after one year through three years 30,506 30,221 30,572 30,281 $ 56,050 $ 55,651 $ 56,364 $ 55,951 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Notional Amounts of Outstanding Forward Contracts | As of December 29, 2018 and September 30, 2018 , we had outstanding forward contracts designated as cash flow hedges with notional amounts equivalent to the following: Currency Hedged December 29, September 30, (in thousands) Euro / U.S. Dollar $ — $ 8,495 Japanese Yen / U.S. Dollar — 2,193 Swedish Kronor / U.S. Dollar — 1,708 Total $ — $ 12,396 As of December 29, 2018 and September 30, 2018 , we had outstanding forward contracts designated as net investment hedges with notional amounts equivalent to the following: Currency Hedged December 29, September 30, (in thousands) Euro / U.S. Dollar $ 140,492 $ — Total $ 140,492 $ — As of December 29, 2018 and September 30, 2018 , we had outstanding forward contracts with notional amounts equivalent to the following: Currency Hedged December 29, September 30, (in thousands) Canadian / U.S. Dollar 7,195 7,334 Euro / U.S. Dollar 249,703 297,730 British Pound / U.S. Dollar 7,616 7,074 Israeli Sheqel / U.S. Dollar 7,424 9,778 Japanese Yen / U.S. Dollar 27,810 37,456 Swiss Franc / U.S. Dollar 12,875 11,944 Danish Kroner/ U.S. Dollar 3,067 1,902 Swedish Kronor / U.S. Dollar 13,562 18,207 Chinese Renminbi / U.S. Dollar 8,981 9,010 All other 9,282 5,521 Total $ 347,515 $ 405,956 |
Net Gains and Losses on Foreign Currency Exposures | The following table shows the effect of our derivative instruments designated as cash flow hedges in the Consolidated Statements of Operations for the three months ended December 29, 2018 and December 30, 2017 (in thousands): Derivatives Designated as Hedging Instruments Gain or (Loss) Recognized in OCI-Effective Portion Location of Gain or (Loss) Reclassified from OCI into Income-Effective Portion Gain or (Loss) Reclassified from OCI into Income-Effective Portion Location of Gain or (Loss) Recognized-Ineffective Portion Gain or (Loss) Recognized-Ineffective Portion Three months ended Three months ended Three months ended December 29, December 30, December 29, December 30, December 29, December 30, Forward Contracts $ 187 $ (1,044 ) Total software revenue $ 627 $ (655 ) Interest income and other expense, net $ — $ (19 ) The following table shows the effect of our non-designated hedges in the Consolidated Statements of Operations for the three months ended December 29, 2018 and December 30, 2017 : Derivatives Not Designated as Hedging Instruments Location of Gain or (Loss) Recognized in Income Net realized and unrealized gain or (loss) (excluding the underlying foreign currency exposure being hedged) Three months ended December 29, December 30, (in thousands) Forward Contracts Interest income and other expense, net $ (987 ) $ 587 The following table shows the effect of our derivative instruments designated as net investment hedges in the Consolidated Statements of Operations for the three months ended December 29, 2018 and December 30, 2017 (in thousands): Derivatives Designated as Hedging Instruments Gain or (Loss) Recognized in OCI-Effective Portion Location of Gain or (Loss) Reclassified from OCI into Income-Effective Portion Gain or (Loss) Reclassified from OCI into Income-Effective Portion Location of Gain or (Loss) Excluded from Effectiveness Testing Gain or (Loss) Recognized-Ineffective Portion Three months ended Three months ended Three months ended December 29, December 30, December 29, December 30, December 29, December 30, Forward Contracts $ (698 ) $ — Accumulated other comprehensive income (loss) $ 773 $ — Interest income and other expense, net $ 486 $ — |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following table shows our derivative instruments measured at gross fair value as reflected in the Consolidated Balance Sheets: Fair Value of Derivatives Designated As Hedging Instruments Fair Value of Derivatives Not Designated As Hedging Instruments December 29, September 30, December 29, September 30, (in thousands) (in thousands) Derivative assets (1): Forward Contracts $ 5 $ 440 $ 1,211 $ 2,449 Derivative liabilities (2): Forward Contracts $ 217 $ — $ 367 $ 3,419 (1) As of December 29, 2018 and September 30, 2018, $1,216 thousand and $2,889 thousand, current derivative assets, respectively, are recorded in other current assets, in the Consolidated Balance Sheets. (2) As of December 29, 2018 and September 30, 2018 $584 thousand and $3,419 thousand current derivative liabilities, respectively, are recorded in accrued expenses and other current liabilities in the Consolidated Balance Sheets. |
Offsetting Assets | The following table sets forth the offsetting of derivative assets as of December 29, 2018 : Gross Amounts Offset in the Consolidated Balance Sheets Gross Amounts Not Offset in the Consolidated Balance Sheets As of December 29, 2018 Gross Amount of Recognized Assets Gross Amounts Offset in the Consolidated Balance Sheets Net Amounts of Assets Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount (in thousands) Forward Contracts $ 1,216 $ — $ 1,216 $ (584 ) $ — $ 632 |
Offsetting Liabilities | The following table sets forth the offsetting of derivative liabilities as of December 29, 2018 : Gross Amounts Offset in the Consolidated Balance Sheets Gross Amounts Not Offset in the Consolidated Balance Sheets As of December 29, 2018 Gross Amount of Recognized Liabilities Gross Amounts Offset in the Consolidated Balance Sheets Net Amounts of Liabilities Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Pledged Net Amount (in thousands) Forward Contracts $ 584 $ — $ 584 $ (584 ) $ — $ — |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Segment Reporting Information [Line Items] | |
Revenue and Operating Income | The revenue and profit attributable to our operating segments are summarized below. We do not produce asset information by reportable segment; therefore, it is not reported. Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, (in thousands) Software Products Revenue $ 293,243 $ 299,388 $ 265,190 Operating Costs (1) 91,628 90,845 99,732 Profit 201,615 208,543 165,458 Professional Services Revenue 41,446 39,369 41,454 Operating Costs (2) 31,863 30,490 34,817 Profit 9,583 8,879 6,637 Total segment revenue 334,689 338,757 306,644 Total segment costs 123,491 121,335 134,549 Total segment profit 211,198 217,422 172,095 Unallocated operating expenses: Sales and marketing expenses 94,496 97,583 94,496 General and administrative expenses 25,771 25,770 27,448 Restructuring charges, net 16,586 16,586 105 Restructuring and headquarters relocation charges, net 1,907 1,907 — Intangibles amortization 12,653 12,653 14,496 Stock-based compensation 29,407 29,407 18,331 Other unallocated operating expenses (income) (3) 334 334 (97 ) Total operating income 30,044 33,182 17,316 Interest expense (10,276 ) (10,276 ) (10,047 ) Other income (expense), net 655 548 (798 ) Income before income taxes $ 20,423 $ 23,454 $ 6,471 We report revenue by the following two product groups: Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, (in thousands) Solutions $ 299,434 $ 298,351 $ 277,669 IoT 35,255 40,406 28,975 Total revenue $ 334,689 $ 338,757 $ 306,644 Our international revenue is presented based on the location of our customer. Revenue for the geographic regions in which we operate is presented below. Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, (in thousands) Revenue: Americas $ 141,853 $ 134,897 $ 127,007 Europe 111,352 120,157 121,466 Asia-Pacific 81,484 83,703 58,171 Total revenue $ 334,689 $ 338,757 $ 306,644 |
Segment Information | Segment and Geographical Information Effective with the beginning of fiscal 2018, we changed our segments, see Note 1. Basis of Presentation for additional information. We operate within a single industry segment -- computer software and related services. Operating segments as defined under GAAP are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is our President and Chief Executive Officer. We have two operating and reportable segments: (1) Software Products, which includes license, subscription and related support revenue (including updates and technical support) for all our products; and (2) Professional Services, which includes consulting, implementation and training services. We do not allocate sales & marketing or general and administrative expense to our operating segments as these activities are managed on a consolidated basis. Additionally, segment profit does not include stock-based compensation, amortization of intangible assets, restructuring charges and certain other identified costs that we do not allocate to the segments for purposes of evaluating their operational performance. The revenue and profit attributable to our operating segments are summarized below. We do not produce asset information by reportable segment; therefore, it is not reported. Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, (in thousands) Software Products Revenue $ 293,243 $ 299,388 $ 265,190 Operating Costs (1) 91,628 90,845 99,732 Profit 201,615 208,543 165,458 Professional Services Revenue 41,446 39,369 41,454 Operating Costs (2) 31,863 30,490 34,817 Profit 9,583 8,879 6,637 Total segment revenue 334,689 338,757 306,644 Total segment costs 123,491 121,335 134,549 Total segment profit 211,198 217,422 172,095 Unallocated operating expenses: Sales and marketing expenses 94,496 97,583 94,496 General and administrative expenses 25,771 25,770 27,448 Restructuring charges, net 16,586 16,586 105 Restructuring and headquarters relocation charges, net 1,907 1,907 — Intangibles amortization 12,653 12,653 14,496 Stock-based compensation 29,407 29,407 18,331 Other unallocated operating expenses (income) (3) 334 334 (97 ) Total operating income 30,044 33,182 17,316 Interest expense (10,276 ) (10,276 ) (10,047 ) Other income (expense), net 655 548 (798 ) Income before income taxes $ 20,423 $ 23,454 $ 6,471 (1) Operating costs for the Software Products segment includes all costs of software revenue and research and development costs, excluding stock-based compensation and intangible amortization. (2) Operating costs for the Professional Services segment includes all cost of professional services revenue, excluding stock-based compensation, intangible amortization and fair value adjustments for deferred services costs. (3) Other unallocated operating expenses include acquisition-related and other transactional costs, pension plan termination-related costs and fair value adjustments for deferred services costs. We report revenue by the following two product groups: Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, (in thousands) Solutions $ 299,434 $ 298,351 $ 277,669 IoT 35,255 40,406 28,975 Total revenue $ 334,689 $ 338,757 $ 306,644 Our international revenue is presented based on the location of our customer. Revenue for the geographic regions in which we operate is presented below. Three months ended As Reported ASC 606 ASC 605 As Reported ASC 605 December 29, December 29, December 30, (in thousands) Revenue: Americas $ 141,853 $ 134,897 $ 127,007 Europe 111,352 120,157 121,466 Asia-Pacific 81,484 83,703 58,171 Total revenue $ 334,689 $ 338,757 $ 306,644 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Dec. 29, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | At December 29, 2018 and September 30, 2018 , we had the following long-term debt obligations: December 29, September 30, (in thousands) 6.000% Senior notes due 2024 $ 500,000 $ 500,000 Credit facility revolver 283,125 148,125 Total debt 783,125 648,125 Unamortized debt issuance costs for the Senior notes (1) (4,641 ) (4,857 ) Total debt, net of issuance costs (2) $ 778,484 $ 643,268 (1) Unamortized debt issuance costs related to the credit facility were $3.6 million and $3.8 million as of December 29, 2018 and September 30, 2018, respectively, and were included in other assets. (2) As of December 29, 2018 and September 30, 2018, all debt was included in long-term debt. |
Basis of Presentation (Details)
Basis of Presentation (Details) $ in Thousands | 3 Months Ended | ||||
Dec. 29, 2018USD ($)Segment | Dec. 30, 2017USD ($) | Oct. 01, 2018USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Number of operating segments | Segment | 2 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Stockholders' Equity Attributable to Parent | $ 1,321,169 | $ 889,099 | $ 874,589 | $ 885,436 | |
Deferred tax assets | 201,149 | 165,566 | |||
Other income (expense), net | 655 | (798) | |||
Accounting Standards Update 2016-16 | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Deferred tax assets | $ 75,300 | ||||
Other Tax Assets | 6,000 | ||||
Other Tax Liabilities | 3,000 | ||||
Accounting Standards Update 2017-07 | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Other income (expense), net | 200 | ||||
Accumulated Deficit | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Stockholders' Equity Attributable to Parent | (138,785) | $ (637,519) | (599,409) | $ (650,840) | |
Accumulated Deficit | Accounting Standards Update 2016-16 | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Stockholders' Equity Attributable to Parent | $ 72,300 | ||||
Other Current Assets | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Restricted Cash | $ 1,100 | $ 1,100 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers Revenue from Contracts with Customers (Additional Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Dec. 29, 2018 | Oct. 01, 2018 | Sep. 30, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Contract with Customer, Asset, Reclassified to Receivable | $ 12,200 | ||
Contract with Customer, Asset, Additions during Period | 400 | ||
Deferred Revenue, Revenue Recognized | 153,700 | ||
Deferred Revenue, Additions | 131,300 | ||
Contract with Customer, Refund Liability | 23,600 | ||
Revenue, Remaining Performance Obligation | $ 938,000 | ||
Accounting Standards Update 2014-09 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 367,378 | ||
Accounting Standards Update 2014-09 | Accumulated Deficit | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Cumulative Effect Of New Accounting Principle In Period Of Adoption, Related To Deferral Of Commission Expenses | $ 70,000 | ||
Cumulative Effect Of New Accounting Principle In Period Of Adoption, Gross | 431,900 | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | 367,400 | $ 367,378 | |
Cumulative Effect Of New Accounting Principle In Period Of Adoption, Related To Offsetting Current Liability | $ 2,800 | ||
Minimum | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Percent of standalone selling price for subscriptions that contains license | 50.00% | ||
Percent of standalone selling price for subscriptions that contains support | 45.00% | ||
Maximum | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Percent of standalone selling price for subscriptions that contains license | 55.00% | ||
Percent of standalone selling price for subscriptions that contains support | 50.00% | ||
Other Current Assets | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Capitalized Contract Cost, Net | $ 19,900 | ||
Other Assets | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Capitalized Contract Cost, Net | $ 52,500 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers (Contract Assets and Contract Liabilities) (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Oct. 01, 2018 |
Disaggregation of Revenue [Abstract] | ||
Contract asset | $ 14,513 | $ 26,265 |
Deferred revenue | $ 335,119 | $ 357,490 |
Revenue from Contracts with C_5
Revenue from Contracts with Customers (Revenue Performance Obligation Narrative) (Details) $ in Millions | 3 Months Ended |
Dec. 29, 2018USD ($) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation | $ 938 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-12-30 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation | $ 0 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 24 months |
Revenue from Contracts with C_6
Revenue from Contracts with Customers (Disaggregation of Revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 334,689 | $ 306,644 |
Subscription license | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 63,517 | |
Subscription support & cloud services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 77,424 | |
Subscription Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 140,941 | |
Perpetual support | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 110,497 | |
Recurring Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 251,438 | |
Perpetual license | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 41,805 | |
Software | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 293,243 | 265,190 |
Professional services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 41,446 | 41,454 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 338,757 | 306,644 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Subscription Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 148,413 | 100,008 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Perpetual support | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 109,225 | 131,197 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Recurring Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 257,638 | 231,205 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Perpetual license | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 41,750 | 33,985 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Software | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 299,388 | 265,190 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Professional services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 39,369 | $ 41,454 |
Revenue from Contracts with C_7
Revenue from Contracts with Customers (Impact of ASC 606 on Balance Sheet) (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 | Dec. 30, 2017 | Sep. 30, 2017 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cash and cash equivalents | $ 276,990 | $ 259,946 | ||
Short-term marketable securities | 25,598 | 25,836 | ||
Accounts receivable, net of allowance for doubtful accounts of $564 and $607 at December 29, 2018 and September 30, 2018, respectively | 385,670 | 129,297 | ||
Prepaid expenses | 63,045 | 48,997 | ||
Other current assets | 48,682 | 169,708 | ||
Total current assets | 799,985 | 633,784 | ||
Property and equipment, net | 107,359 | 80,613 | ||
Goodwill | 1,230,901 | 1,182,457 | ||
Acquired intangible assets, net | 205,084 | 200,202 | ||
Long-term marketable securities | 30,054 | 30,115 | ||
Deferred tax assets | 201,149 | 165,566 | ||
Other assets | 178,437 | 36,285 | ||
Total assets | 2,752,969 | 2,329,022 | ||
Accounts payable | 57,249 | 53,473 | ||
Accrued expenses and other current liabilities | 83,721 | 74,388 | ||
Accrued compensation and benefits | 74,483 | 101,784 | ||
Accrued income taxes | 405 | 18,044 | ||
Deferred revenue | 325,111 | 487,590 | ||
Total current liabilities | 540,969 | 735,279 | ||
Long-term debt | 778,484 | 643,268 | ||
Deferred tax liabilities | 36,261 | 5,589 | ||
Deferred revenue | 10,197 | 11,852 | ||
Other liabilities | 65,889 | 58,445 | ||
Total liabilities | 1,431,800 | 1,454,433 | ||
Preferred stock | 0 | 0 | ||
Common stock | 1,187 | 1,180 | ||
Additional paid-in capital | 1,553,875 | 1,558,403 | ||
Accumulated deficit | (138,785) | (599,409) | ||
Accumulated other comprehensive loss | (95,108) | (85,585) | ||
Total stockholders’ equity | 1,321,169 | 874,589 | $ 889,099 | $ 885,436 |
Total liabilities and stockholders’ equity | 2,752,969 | $ 2,329,022 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cash and cash equivalents | 276,990 | |||
Short-term marketable securities | 25,598 | |||
Accounts receivable, net of allowance for doubtful accounts of $564 and $607 at December 29, 2018 and September 30, 2018, respectively | 138,989 | |||
Prepaid expenses | 63,045 | |||
Other current assets | 143,104 | |||
Total current assets | 647,726 | |||
Property and equipment, net | 107,359 | |||
Goodwill | 1,230,901 | |||
Acquired intangible assets, net | 205,084 | |||
Long-term marketable securities | 30,054 | |||
Deferred tax assets | 234,558 | |||
Other assets | 34,328 | |||
Total assets | 2,490,010 | |||
Accounts payable | 57,249 | |||
Accrued expenses and other current liabilities | 56,897 | |||
Accrued compensation and benefits | 74,483 | |||
Accrued income taxes | 4,958 | |||
Deferred revenue | 484,613 | |||
Total current liabilities | 678,200 | |||
Long-term debt | 778,484 | |||
Deferred tax liabilities | 5,731 | |||
Deferred revenue | 8,324 | |||
Other liabilities | 65,889 | |||
Total liabilities | 1,536,628 | |||
Preferred stock | 0 | |||
Common stock | 1,187 | |||
Additional paid-in capital | 1,553,875 | |||
Accumulated deficit | (507,900) | |||
Accumulated other comprehensive loss | (93,780) | |||
Total stockholders’ equity | 953,382 | |||
Total liabilities and stockholders’ equity | $ 2,490,010 |
Revenue from Contracts with C_8
Revenue from Contracts with Customers (Impact of ASC 606 on Income Statement) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | $ 334,689 | $ 306,644 |
Cost of revenue | 77,352 | 83,035 |
Gross margin | 257,337 | 223,609 |
Sales and marketing | 104,218 | 99,375 |
Research and development | 60,782 | 63,972 |
General and administrative | 37,864 | 35,020 |
Amortization of acquired intangible assets | 5,936 | 7,821 |
Restructuring and other charges, net | 18,493 | 105 |
Total operating expenses | 227,293 | 206,293 |
Operating income | 30,044 | 17,316 |
Interest Expense | 10,276 | 10,047 |
Other income (expense), net | 655 | (798) |
Income before income taxes | 20,423 | 6,471 |
Benefit for income taxes | (562) | (7,406) |
Net income | 20,985 | 13,877 |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 338,757 | 306,644 |
Cost of revenue | 75,196 | |
Gross margin | 263,561 | |
Sales and marketing | 107,304 | |
Research and development | 60,782 | |
General and administrative | 37,864 | |
Amortization of acquired intangible assets | 5,936 | |
Restructuring and other charges, net | 18,493 | |
Total operating expenses | 230,379 | |
Operating income | 33,182 | |
Interest Expense | 10,276 | |
Other income (expense), net | 548 | |
Income before income taxes | 23,454 | |
Benefit for income taxes | 4,206 | |
Net income | 19,248 | |
Software | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 293,243 | 265,190 |
Cost of revenue | 43,760 | 46,616 |
Software | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 299,388 | 265,190 |
Cost of revenue | 42,977 | |
Support and cloud services | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 187,921 | 145,672 |
Cost of revenue | 31,197 | 34,502 |
Support and cloud services | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 125,483 | |
Cost of revenue | 30,630 | |
License | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 105,322 | 119,518 |
Cost of revenue | 12,563 | 12,114 |
License | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 173,905 | |
Cost of revenue | 12,347 | |
Professional services | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 41,446 | 41,454 |
Cost of revenue | 33,592 | 36,419 |
Professional services | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 39,369 | $ 41,454 |
Cost of revenue | 32,219 | |
Accounting Standards Update 2014-09 | License | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Revenue | 65,000 | |
Revenue On New And Renewal Bookings | $ 59,000 |
Restructuring and Other Charg_3
Restructuring and Other Charges (Additional Information) (Details) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018USD ($)employee | Dec. 30, 2017USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and other charges, net | $ 18,493 | $ 105 |
Free rent and estimated sublease income new headquarters | 30,000 | |
estimated undiscounted cash flows old headquarters | 29,000 | |
Facility closures and related costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Assumed Sublease Income | 1,900 | |
Accrued Expenses and Other Current Liabilities [Member] | Facility closures and related costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 1,300 | 2,200 |
Other Noncurrent Liabilities [Member] | Facility closures and related costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | 1,000 | $ 2,100 |
Restructuring Plan 2019 [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and other charges, net | $ 16,300 | |
Restructuring and Related Cost, Number of Positions Eliminated | employee | 240 | |
Prior Year Plans [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and other charges, net | $ 300 | |
Prior Headquarters [Member] | Facility closures and related costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost | 24,000 | |
Depreciation | $ 1,900 |
Restructuring and Other Charg_4
Restructuring and Other Charges (Schedule of Restructuring Reserve) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Restructuring Reserve [Roll Forward] | ||
Charges to operations, net | $ 18,493 | $ 105 |
2016 and 2019 Restructuring Plans; excluding headquarters restructuring [Member] | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | 2,415 | |
Charges to operations, net | 16,586 | |
Cash disbursements | (8,283) | |
Foreign exchange impact | (27) | |
Restructuring reserve, ending balance | 10,691 | |
2016 and 2019 Restructuring Plans; excluding headquarters restructuring [Member] | Employee severance and related benefits | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | 0 | |
Charges to operations, net | 16,343 | |
Cash disbursements | (8,019) | |
Foreign exchange impact | 32 | |
Restructuring reserve, ending balance | 8,356 | |
2016 and 2019 Restructuring Plans; excluding headquarters restructuring [Member] | Facility closures and related costs | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | 2,415 | |
Charges to operations, net | 243 | |
Cash disbursements | (264) | |
Foreign exchange impact | (59) | |
Restructuring reserve, ending balance | 2,335 | |
Restructuring Plan 2019 [Member] | ||
Restructuring Reserve [Roll Forward] | ||
Charges to operations, net | $ 16,300 | |
Restructuring Plan 2016 [Member] | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | 6,244 | |
Charges to operations, net | 105 | |
Cash disbursements | (735) | |
Foreign exchange impact | (1) | |
Restructuring reserve, ending balance | 5,613 | |
Restructuring Plan 2016 [Member] | Employee severance and related benefits | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | 1,736 | |
Charges to operations, net | (212) | |
Cash disbursements | (198) | |
Foreign exchange impact | 17 | |
Restructuring reserve, ending balance | 1,343 | |
Restructuring Plan 2016 [Member] | Facility closures and related costs | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | 4,508 | |
Charges to operations, net | 317 | |
Cash disbursements | (537) | |
Foreign exchange impact | (18) | |
Restructuring reserve, ending balance | $ 4,270 |
Stock-based Compensation (Narra
Stock-based Compensation (Narrative) (Details) | 3 Months Ended | |
Dec. 29, 2018USD ($)shares / unit | Dec. 30, 2017USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Common Stock Issuable per Restricted Stock Unit | shares / unit | 1 | |
ESPP maximum contribution percentage | 10.00% | |
ESPP maximum contribution amount by employee | $ 25,000 | |
ESPP purchase price as a % of stock price | 85.00% | |
Stock-based compensation | $ 29,407,000 | $ 18,331,000 |
ESPP | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation | $ 1,300,000 | $ 1,100,000 |
Stock-based Compensation (Sched
Stock-based Compensation (Schedule of Restricted Stock Unit Activity) (Details) - Restricted Stock Units (RSUs) shares in Thousands | 3 Months Ended |
Dec. 29, 2018$ / sharesshares | |
Shares | |
Balance of outstanding restricted stock units, beginning, Shares | shares | 3,284 |
Granted, shares | shares | 979 |
Vested, Shares | shares | (1,056) |
Forfeited or not earned, Shares | shares | (266) |
Balance of outstanding restricted stock units, ending, Shares | shares | 2,941 |
Weighted Average Grant Date Fair Value (Per Share) | |
Balance of outstanding restricted stock units, beginning (in USD per share) | $ / shares | $ 65.93 |
Granted (in USD per share) | $ / shares | 81.34 |
Vested (in USD per share) | $ / shares | 53.40 |
Forfeited or not earned (in USD per share) | $ / shares | 63.60 |
Balance of outstanding restricted stock units, ending (in USD per share) | $ / shares | $ 75.85 |
Stock-based Compensation (Sch_2
Stock-based Compensation (Schedule of Restricted Stock Unit Grants For The Period) (Details) shares in Thousands | 3 Months Ended |
Dec. 29, 2018installmentshares | |
TSR Units [Member] | |
Granted, shares | 141 |
Performance-Based Restricted Stock Units [Member] | |
Granted, shares | 344 |
Award vesting period | 3 years |
Number of equal annual installments | installment | 3 |
Service-Based Restricted Stock Units [Member] | |
Granted, shares | 494 |
Number of equal annual installments | installment | 3 |
Catch-Up Provision [Member] | Maximum | Performance-Based Restricted Stock Units [Member] | |
Granted, shares | 145 |
No Catch-Up Provision [Member] | Maximum | Performance-Based Restricted Stock Units [Member] | |
Granted, shares | 199 |
Stock-based Compensation (Sch_3
Stock-based Compensation (Schedule of Classification of Compensation Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Total stock-based compensation expense | $ 29,407 | $ 18,331 |
License cost [Member] | ||
Total stock-based compensation expense | 322 | (90) |
Cost of support and cloud services revenue | ||
Total stock-based compensation expense | 975 | 1,311 |
Cost of professional services revenue | ||
Total stock-based compensation expense | 1,814 | 1,706 |
Sales and marketing | ||
Total stock-based compensation expense | 9,722 | 4,879 |
Research and development | ||
Total stock-based compensation expense | 4,900 | 2,960 |
General and administrative | ||
Total stock-based compensation expense | $ 11,674 | $ 7,565 |
Earnings per Share (EPS) and _3
Earnings per Share (EPS) and Common Stock (Earnings per Share Basic and Diluted) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Earnings Per Share and Common Stock | ||
Net income | $ 20,985 | $ 13,877 |
Weighted average shares outstanding—Basic (in shares) | 118,323 | 115,731 |
Dilutive effect of employee stock options, restricted shares and restricted stock units (in shares) | 1,315 | 1,925 |
Weighted average shares outstanding—Diluted (in shares) | 119,638 | 117,656 |
Earnings per share—Basic (in USD per share) | $ 0.18 | $ 0.12 |
Earnings per share—Diluted (in USD per share) | $ 0.18 | $ 0.12 |
Earnings per Share (EPS) and _4
Earnings per Share (EPS) and Common Stock (Narrative) (Details) - USD ($) | 3 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Sep. 30, 2018 | |
Earnings Per Share and Common Stock | |||
Stock option restricted shares and restricted stock units excluded from computation of EPS, shares | 0 | 300,000 | |
Common stock, shares authorized | 500,000,000 | 500,000,000 | |
Stock Repurchase Program, Authorized Amount | $ 1,500,000,000 |
Acquisitions (Details)
Acquisitions (Details) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018USD ($)employee | Dec. 30, 2017USD ($) | |
Business Acquisition [Line Items] | ||
Business Combination, Acquisition Related Costs | $ 400 | $ 100 |
Frustum acquisition | 53,777 | |
Frustum [Member] | ||
Business Acquisition [Line Items] | ||
Business Combination, Consideration Transferred | 69,600 | |
Cash Acquired from Acquisition | $ 700 | |
Entity Number of Employees | employee | 12 | |
Frustum acquisition | $ 53,800 | |
Finite-lived Intangible Assets Acquired | 17,900 | |
Liabilities | $ 2,100 | |
Acquired finite-lived intangible asset, weighted average useful life | 15 years |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Narrative) (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 29, 2018USD ($)Segment | Sep. 30, 2017Segment | Sep. 30, 2018USD ($) | |
Number of operating segments | Segment | 2 | ||
Number of reportable segments | Segment | 2 | 3 | |
Intangible Assets, Net (Including Goodwill) | $ 1,435,985 | $ 1,382,659 | |
Foreign currency translation adjustment | (5,333) | ||
Goodwill | 1,230,901 | 1,182,457 | |
Professional Services | |||
Intangible Assets, Net (Including Goodwill) | 30,100 | 30,200 | |
Foreign currency translation adjustment | (134) | ||
Goodwill | 29,603 | 29,737 | |
Software Products | |||
Intangible Assets, Net (Including Goodwill) | 1,405,900 | 1,352,400 | |
Foreign currency translation adjustment | (5,199) | ||
Goodwill | $ 1,201,298 | $ 1,152,720 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Goodwill and Acquired Intangible Assets) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Sep. 30, 2018 | |
Goodwill (not amortized), Net Book Value | $ 1,230,901 | $ 1,182,457 |
Intangible assets with finite lives (amortized), Gross Carrying Amount | 780,910 | 766,199 |
Intangible assets with finite lives (amortized), Accumulated Amortization | 575,826 | 565,997 |
Intangible assets with finite lives (amortized), Net Book Value | 205,084 | 200,202 |
Intangible Assets, Net (Including Goodwill) | 1,435,985 | 1,382,659 |
Purchased software | ||
Intangible assets with finite lives (amortized), Gross Carrying Amount | 379,653 | 362,679 |
Intangible assets with finite lives (amortized), Accumulated Amortization | 259,850 | 254,059 |
Intangible assets with finite lives (amortized), Net Book Value | $ 119,803 | 108,620 |
Acquired finite-lived intangible asset, weighted average useful life | 10 years | |
Capitalized software | ||
Intangible assets with finite lives (amortized), Gross Carrying Amount | $ 22,877 | 22,877 |
Intangible assets with finite lives (amortized), Accumulated Amortization | 22,877 | 22,877 |
Intangible assets with finite lives (amortized), Net Book Value | 0 | 0 |
Customer lists and relationships | ||
Intangible assets with finite lives (amortized), Gross Carrying Amount | 355,412 | 357,586 |
Intangible assets with finite lives (amortized), Accumulated Amortization | 274,239 | 270,272 |
Intangible assets with finite lives (amortized), Net Book Value | $ 81,173 | 87,314 |
Acquired finite-lived intangible asset, weighted average useful life | 10 years | |
Trademarks and trade names | ||
Intangible assets with finite lives (amortized), Gross Carrying Amount | $ 18,987 | 19,054 |
Intangible assets with finite lives (amortized), Accumulated Amortization | 14,879 | 14,786 |
Intangible assets with finite lives (amortized), Net Book Value | $ 4,108 | 4,268 |
Acquired finite-lived intangible asset, weighted average useful life | 11 years | |
Other | ||
Intangible assets with finite lives (amortized), Gross Carrying Amount | $ 3,981 | 4,003 |
Intangible assets with finite lives (amortized), Accumulated Amortization | 3,981 | 4,003 |
Intangible assets with finite lives (amortized), Net Book Value | $ 0 | $ 0 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Schedule of Goodwill) (Details) $ in Thousands | 3 Months Ended |
Dec. 29, 2018USD ($) | |
Goodwill [Line Items] | |
Balance, October 1, 2018 | $ 1,182,457 |
Frustum acquisition | 53,777 |
Foreign currency translation adjustment | (5,333) |
Balance, December 29, 2018 | 1,230,901 |
Software Products | |
Goodwill [Line Items] | |
Balance, October 1, 2018 | 1,152,720 |
Frustum acquisition | 53,777 |
Foreign currency translation adjustment | (5,199) |
Balance, December 29, 2018 | 1,201,298 |
Professional Services | |
Goodwill [Line Items] | |
Balance, October 1, 2018 | 29,737 |
Frustum acquisition | 0 |
Foreign currency translation adjustment | (134) |
Balance, December 29, 2018 | $ 29,603 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets (Amortization of Intangible Assets) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of acquired intangible assets | $ 5,936 | $ 7,821 |
Cost of license revenue | 6,717 | 6,675 |
Total amortization expense | $ 12,653 | $ 14,496 |
Fair Value Measurements (Schedu
Fair Value Measurements (Schedule of Financial Assets and Liabilities Measured at Fair Value) (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
Financial assets: | ||
Cash equivalents | $ 89,023 | $ 93,058 |
Marketable securities | 55,651 | 55,951 |
Forward contracts | 1,216 | 2,889 |
Financial assets, fair value | 145,890 | 151,898 |
Financial liabilities: | ||
Contingent consideration related to acquisitions | 0 | 1,575 |
Forward contracts | 584 | 3,419 |
Liabilities, Fair Value Disclosure, Recurring | 584 | 4,994 |
Level 1 | ||
Financial assets: | ||
Cash equivalents | 89,023 | 93,058 |
Financial assets, fair value | 141,503 | 147,795 |
Level 2 | ||
Financial assets: | ||
Forward contracts | 1,216 | 2,889 |
Financial assets, fair value | 4,387 | 4,103 |
Financial liabilities: | ||
Forward contracts | 584 | 3,419 |
Liabilities, Fair Value Disclosure, Recurring | 584 | 3,419 |
Level 3 | ||
Financial liabilities: | ||
Contingent consideration related to acquisitions | 0 | 1,575 |
Liabilities, Fair Value Disclosure, Recurring | 0 | 1,575 |
Certificates of deposit | ||
Financial assets: | ||
Marketable securities | 220 | 219 |
Certificates of deposit | Level 2 | ||
Financial assets: | ||
Marketable securities | 220 | 219 |
Commercial paper | ||
Financial assets: | ||
Marketable securities | 1,956 | |
Commercial paper | Level 2 | ||
Financial assets: | ||
Marketable securities | 1,956 | |
Corporate notes/bonds | ||
Financial assets: | ||
Marketable securities | 52,480 | 54,737 |
Corporate notes/bonds | Level 1 | ||
Financial assets: | ||
Marketable securities | 52,480 | 54,737 |
U.S. government agency securities | ||
Financial assets: | ||
Marketable securities | 995 | 995 |
U.S. government agency securities | Level 2 | ||
Financial assets: | ||
Marketable securities | $ 995 | $ 995 |
Fair Value Measurements (Change
Fair Value Measurements (Changes in Fair Value of Level 3 Contingent Consideration Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Business Combination. Contingent Consideration [Roll Forward] | ||
Beginning balance | $ 1,575 | |
Payment of contingent consideration | (1,600) | $ (3,800) |
Ending balance | 0 | |
Level 3 | ||
Business Combination. Contingent Consideration [Roll Forward] | ||
Beginning balance | 1,575 | |
Ending balance | 0 | |
Kepware | Level 3 | ||
Business Combination. Contingent Consideration [Roll Forward] | ||
Beginning balance | 8,400 | |
Payment of contingent consideration | (3,757) | |
Ending balance | $ 4,643 | |
Other | Level 3 | ||
Business Combination. Contingent Consideration [Roll Forward] | ||
Beginning balance | 1,575 | |
Payment of contingent consideration | (1,575) | |
Ending balance | $ 0 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Dec. 29, 2018 | Dec. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent consideration related to acquisitions | $ 0 | $ 1,575 | ||
Payment of contingent consideration | 1,600 | $ 3,800 | ||
Business Combination, Consideration Transferred, Liabilities Incurred | 1,600 | 3,200 | ||
Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent consideration related to acquisitions | 0 | $ 1,575 | ||
Level 3 | Accrued Expenses and Other Current Liabilities [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent consideration related to acquisitions | $ 0 | 4,600 | ||
Kepware | Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent consideration related to acquisitions | 4,643 | $ 8,400 | ||
Payment of contingent consideration | $ 3,757 |
Marketable Securities (Amortize
Marketable Securities (Amortized Cost and Fair Value of Marketable Securities) (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | $ 56,050 | $ 56,364 |
Gross unrealized gains | 6 | 0 |
Gross unrealized losses | (405) | (413) |
Fair value | 55,651 | 55,951 |
Certificates of deposit | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 221 | 220 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | (1) | (1) |
Fair value | 220 | 219 |
Commercial paper | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 1,961 | |
Gross unrealized gains | 0 | |
Gross unrealized losses | (5) | |
Fair value | 1,956 | |
Corporate notes/bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 52,868 | 55,140 |
Gross unrealized gains | 6 | 0 |
Gross unrealized losses | (394) | (403) |
Fair value | 52,480 | 54,737 |
U.S. government agency securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 1,000 | 1,004 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | (5) | (9) |
Fair value | $ 995 | $ 995 |
Marketable Securities (Schedule
Marketable Securities (Schedule of Fair Value and Gross Unrealized Losses) (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | $ 24,259 | $ 24,286 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (124) | (71) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 28,910 | 31,665 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (281) | (342) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 53,169 | 55,951 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | (405) | (413) |
Certificates of deposit | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 0 | 219 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 | (1) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 220 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (1) | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 220 | 219 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | (1) | (1) |
Commercial paper | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 1,956 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (5) | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 0 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 1,956 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | (5) | |
Corporate notes/bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 22,303 | 24,067 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (119) | (70) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 27,695 | 30,670 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (275) | (333) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 49,998 | 54,737 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | (394) | (403) |
U.S. government agency securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 0 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 995 | 995 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (5) | (9) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 995 | 995 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | $ (5) | $ (9) |
Marketable Securities (Schedu_2
Marketable Securities (Schedule of Available-for-sale Marketable Securities by Contractual Maturity Date) (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
Investments, Debt and Equity Securities [Abstract] | ||
Due in one year or less, amortized cost | $ 25,544 | $ 25,792 |
Due in one year or less, fair value | 25,430 | 25,670 |
Due after one year through three years, amortized cost | 30,506 | 30,572 |
Due after one year through three years, fair value | 30,221 | 30,281 |
Amortized cost | 56,050 | 56,364 |
Fair value | $ 55,651 | $ 55,951 |
Derivative Financial Instrume_3
Derivative Financial Instruments (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Gain (Loss) on Foreign Currency Derivative Instruments Not Designated as Hedging Instruments | $ 0.2 | $ 1.5 |
Forward Contracts | Not Designated as Hedging Instrument | ||
Derivative, Remaining Maturity | 3 months | |
Cash Flow Hedging | Forward Contracts | Designated as Hedging Instrument | ||
Derivative, Remaining Maturity | 15 months | |
Net Investment Hedging | Forward Contracts | Designated as Hedging Instrument | ||
Derivative, Remaining Maturity | 3 months |
Derivative Financial Instrume_4
Derivative Financial Instruments (Notional Amounts Of Outstanding Forward Contracts) (Details) - Forward Contracts - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
Not Designated as Hedging Instrument | ||
Notional amounts | $ 347,515 | $ 405,956 |
Not Designated as Hedging Instrument | Canadian / U.S. Dollar | ||
Notional amounts | 7,195 | 7,334 |
Not Designated as Hedging Instrument | Japanese Yen / Euro | ||
Notional amounts | 249,703 | 297,730 |
Not Designated as Hedging Instrument | United Kingdom, Pounds | ||
Notional amounts | 7,616 | 7,074 |
Not Designated as Hedging Instrument | Japanese Yen / U.S. Dollar | ||
Notional amounts | 27,810 | 37,456 |
Not Designated as Hedging Instrument | Switzerland, Francs | ||
Notional amounts | 12,875 | 11,944 |
Not Designated as Hedging Instrument | Swiss Franc / U.S. Dollar | ||
Notional amounts | 7,424 | 9,778 |
Not Designated as Hedging Instrument | Swedish Kronor / U.S. Dollar | ||
Notional amounts | 13,562 | 18,207 |
Not Designated as Hedging Instrument | Singapore Dollar / U.S. Dollar | ||
Notional amounts | 3,067 | 1,902 |
Not Designated as Hedging Instrument | China, Yuan Renminbi | ||
Notional amounts | 8,981 | 9,010 |
Not Designated as Hedging Instrument | All other | ||
Notional amounts | 9,282 | 5,521 |
Cash Flow Hedging | Designated as Hedging Instrument | ||
Notional amounts | 0 | 12,396 |
Cash Flow Hedging | Designated as Hedging Instrument | Japanese Yen / Euro | ||
Notional amounts | 0 | 8,495 |
Cash Flow Hedging | Designated as Hedging Instrument | Japanese Yen / U.S. Dollar | ||
Notional amounts | 0 | 2,193 |
Cash Flow Hedging | Designated as Hedging Instrument | Swedish Kronor / U.S. Dollar | ||
Notional amounts | 0 | 1,708 |
Net Investment Hedging | Designated as Hedging Instrument | ||
Notional amounts | 140,492 | 0 |
Net Investment Hedging | Designated as Hedging Instrument | Japanese Yen / Euro | ||
Notional amounts | $ 140,492 | $ 0 |
Derivative Financial Instrume_5
Derivative Financial Instruments (Derivative Instruments and Hedging Activities Disclosures) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain or (Loss) Recognized in OCI-Effective Portion | $ (2,129) | $ (913) |
Forward Contracts | Designated as Hedging Instrument | Cash Flow Hedging | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain or (Loss) Recognized in OCI-Effective Portion | 187 | (1,044) |
Forward Contracts | Designated as Hedging Instrument | Net Investment Hedging | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain or (Loss) Recognized in OCI-Effective Portion | (698) | 0 |
Gain or (Loss) Reclassified from OCI into Income-Effective Portion | 773 | 0 |
Forward Contracts | Total Software Revenue | Designated as Hedging Instrument | Cash Flow Hedging | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain or (Loss) Reclassified from OCI into Income-Effective Portion | 627 | (655) |
Forward Contracts | Interest income and other expense, net | Not Designated as Hedging Instrument | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Net realized and unrealized gain or (loss) (excluding the underlying foreign currency exposure being hedged) | 987 | (587) |
Forward Contracts | Interest income and other expense, net | Designated as Hedging Instrument | Cash Flow Hedging | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain or (Loss) Recognized-Ineffective Portion | 0 | (19) |
Forward Contracts | Interest income and other expense, net | Designated as Hedging Instrument | Net Investment Hedging | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain or (Loss) Recognized-Ineffective Portion | $ 486 | $ 0 |
Derivative Financial Instrume_6
Derivative Financial Instruments Derivative Financial Instruments (Gross Fair Value) (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
Derivative [Line Items] | ||
Forward contracts | $ 1,216 | $ 2,889 |
Forward contracts | 584 | 3,419 |
Not Designated as Hedging Instrument | Forward Contracts | ||
Derivative [Line Items] | ||
Foreign Currency Derivative Instruments Not Designated as Hedging Instruments, Asset at Fair Value | 1,211 | 2,449 |
Foreign Currency Derivative Instruments Not Designated as Hedging Instruments, Liability at Fair Value | 367 | 3,419 |
Designated as Hedging Instrument | Forward Contracts | ||
Derivative [Line Items] | ||
Foreign Currency Cash Flow Hedge Asset at Fair Value | 5 | 440 |
Foreign Currency Cash Flow Hedge Liability at Fair Value | 217 | 0 |
Other Current Assets | Forward Contracts | ||
Derivative [Line Items] | ||
Forward contracts | 1,216 | 2,889 |
Other Noncurrent Assets | Forward Contracts | ||
Derivative [Line Items] | ||
Forward contracts | 0 | 0 |
Other Current Liabilities [Member] | Forward Contracts | ||
Derivative [Line Items] | ||
Forward contracts | 584 | 3,419 |
Other Noncurrent Liabilities [Member] | Forward Contracts | ||
Derivative [Line Items] | ||
Forward contracts | $ 0 | $ 0 |
Derivative Financial Instrume_7
Derivative Financial Instruments (Offsetting Assets) (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Gross Amount of Recognized Assets | $ 1,216 | |
Gross Amounts Offset in the Consolidated Balance Sheets | 0 | |
Net Amounts of Assets Presented in the Consolidated Balance Sheets | 1,216 | $ 2,889 |
Gross Amounts Not Offset in the Consolidated Balance Sheets, Financial Instruments | (584) | |
Gross Amounts Not Offset in the Consolidated Balance Sheets, Cash Collateral Received | 0 | |
Net Amount | $ 632 |
Derivative Financial Instrume_8
Derivative Financial Instruments (Offsetting Liabilities) (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Sep. 30, 2018 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Gross Amount of Recognized Liabilities | $ 584 | |
Gross Amounts Offset in the Consolidated Balance Sheets | 0 | |
Net Amounts of Liabilities Presented in the Consolidated Balance Sheets | 584 | $ 3,419 |
Gross Amounts Not Offset in the Consolidated Balance Sheets, Financial Instruments | (584) | |
Gross Amounts Not Offset in the Consolidated Balance Sheets, Cash Collateral Pledged | 0 | |
Net Amount | $ 0 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 29, 2018USD ($)Segment | Dec. 30, 2017USD ($) | Sep. 30, 2017Segment | |
Number of operating segments | Segment | 2 | ||
Number of reportable segments | Segment | 2 | 3 | |
Revenue | $ 334,689 | $ 306,644 | |
Operating Costs | 77,352 | 83,035 | |
Gross margin | 257,337 | 223,609 | |
Sales and marketing | 104,218 | 99,375 | |
General and administrative | 37,864 | 35,020 | |
Restructuring and other charges, net | 18,493 | 105 | |
Amortization of acquired intangible assets | 5,936 | 7,821 | |
Operating income | 30,044 | 17,316 | |
Interest expense | (10,276) | (10,047) | |
Other income (expense), net | (655) | 798 | |
Income before income taxes | 20,423 | 6,471 | |
Operating Segments | |||
Revenue | 334,689 | 306,644 | |
Operating Costs | 123,491 | 134,549 | |
Gross margin | 211,198 | 172,095 | |
Operating Segments | Americas [Member] | |||
Revenue | 141,853 | 127,007 | |
Operating Segments | Europe [Member] | |||
Revenue | 111,352 | 121,466 | |
Operating Segments | Asia Pacific [Member] | |||
Revenue | 81,484 | 58,171 | |
Unallocated | |||
Sales and marketing | 94,496 | 94,496 | |
General and administrative | 25,771 | 27,448 | |
Amortization of acquired intangible assets | 12,653 | 14,496 | |
Stock-based compensation | 29,407 | 18,331 | |
Other unallocated operating expenses | 334 | (97) | |
Restructuring Plan 2019 [Member] | |||
Restructuring and other charges, net | 16,300 | ||
Restructuring Plan 2019 [Member] | Unallocated | |||
Restructuring and other charges, net | 16,586 | 105 | |
Prior Headquarters [Member] | Unallocated | |||
Restructuring and other charges, net | 1,907 | 0 | |
Solutions | Operating Segments | |||
Revenue | 299,434 | 277,669 | |
IoT | Operating Segments | |||
Revenue | 35,255 | 28,975 | |
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||
Revenue | 338,757 | 306,644 | |
Operating Costs | 75,196 | ||
Gross margin | 263,561 | ||
Sales and marketing | 107,304 | ||
General and administrative | 37,864 | ||
Restructuring and other charges, net | 18,493 | ||
Amortization of acquired intangible assets | 5,936 | ||
Operating income | 33,182 | ||
Interest expense | (10,276) | ||
Other income (expense), net | (548) | ||
Income before income taxes | 23,454 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Operating Segments | |||
Revenue | 338,757 | ||
Operating Costs | 121,335 | ||
Gross margin | 217,422 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Operating Segments | Americas [Member] | |||
Revenue | 134,897 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Operating Segments | Europe [Member] | |||
Revenue | 120,157 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Operating Segments | Asia Pacific [Member] | |||
Revenue | 83,703 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Unallocated | |||
Sales and marketing | 97,583 | ||
General and administrative | 25,770 | ||
Amortization of acquired intangible assets | 12,653 | ||
Stock-based compensation | 29,407 | ||
Other unallocated operating expenses | 334 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Restructuring Plan 2019 [Member] | Unallocated | |||
Restructuring and other charges, net | 16,586 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Prior Headquarters [Member] | Unallocated | |||
Restructuring and other charges, net | 1,907 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Solutions | Operating Segments | |||
Revenue | 298,351 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | IoT | Operating Segments | |||
Revenue | 40,406 | ||
Software Products | Operating Segments | |||
Revenue | 293,243 | 265,190 | |
Operating Costs | 91,628 | 99,732 | |
Gross margin | 201,615 | 165,458 | |
Software Products | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Operating Segments | |||
Revenue | 299,388 | ||
Operating Costs | 90,845 | ||
Gross margin | 208,543 | ||
Professional Services | Operating Segments | |||
Revenue | 41,446 | 41,454 | |
Operating Costs | 31,863 | 34,817 | |
Gross margin | 9,583 | $ 6,637 | |
Professional Services | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Operating Segments | |||
Revenue | 39,369 | ||
Operating Costs | 30,490 | ||
Gross margin | $ 8,879 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||||
Jul. 31, 2016 | Dec. 29, 2018 | Dec. 30, 2017 | Oct. 01, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Tax Disclosure [Line Items] | ||||||
Effective income tax rate | (3.00%) | (114.00%) | ||||
Income before income taxes | $ 20,423 | $ 6,471 | ||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | |||||
Valuation Allowance, Deferred Tax Asset, Explanation of Change | 1.8 | |||||
Effective Income Tax Rate Reconciliation, Prior Year Income Taxes, Percent | 24.50% | |||||
Operating Loss Carryforwards, Limitations on Use | 0.8 | |||||
Unrecognized tax benefits | $ 10,300 | $ 9,800 | ||||
Income tax provision upon recognition of unrecognized tax benefit | 10,300 | |||||
Unrecognized tax benefits that would impact valuation allowance | 3,800 | |||||
Potentail reduction in unrecognized tax benefits and accrued interest over next 12 months | (2,000) | |||||
Stockholders' Equity Attributable to Parent | 1,321,169 | $ 889,099 | 874,589 | $ 885,436 | ||
Deferred tax assets | 201,149 | 165,566 | ||||
Korea | ||||||
Income Tax Disclosure [Line Items] | ||||||
Income tax examination, estimate of possible loss | $ 12,000 | |||||
US Tax on Undistributed Foreign Earnings [Member] | ||||||
Income Tax Disclosure [Line Items] | ||||||
Current Federal, State and Local, Tax Expense (Benefit) | 1,500 | 7,100 | ||||
Net Decrease in Deferred Tax Liability [Member] | ||||||
Income Tax Disclosure [Line Items] | ||||||
Deferred Income Tax Expense (Benefit) | 14,200 | |||||
Accounting Standards Update 2016-16 | ||||||
Income Tax Disclosure [Line Items] | ||||||
Deferred tax assets | $ 75,300 | |||||
Other Tax Assets | 6,000 | |||||
Other Tax Liabilities | 3,000 | |||||
Accumulated Deficit | ||||||
Income Tax Disclosure [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | $ (138,785) | $ (637,519) | $ (599,409) | $ (650,840) | ||
Accumulated Deficit | Accounting Standards Update 2016-16 | ||||||
Income Tax Disclosure [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | $ 72,300 |
Debt (Details)
Debt (Details) | May 15, 2019 | Dec. 29, 2018USD ($) | Dec. 30, 2017USD ($) | Sep. 30, 2018USD ($) | Feb. 07, 2019USD ($) | Sep. 13, 2018USD ($)bank | May 31, 2016USD ($) |
Debt Instrument [Line Items] | |||||||
Senior Notes | $ 500,000,000 | $ 500,000,000 | $ 500,000,000 | ||||
Long-term Debt, Gross | 783,125,000 | 648,125,000 | |||||
debt net of unamortized debt issuance cost | $ 778,484,000 | $ 643,268,000 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | 6.00% | 6.00% | ||||
Voting interest in domestic subsidiaries pledged against credit facility | 100.00% | ||||||
Voting interest in foreign subsidiaries pledged against credit facility | 65.00% | ||||||
Leverage Ratio, Actual | 2.30 | ||||||
Debt Instrument, Covenant Compliance, Senior Debt Leverage Ratio, actual | 0.86 | ||||||
Fixed charge coverage ratio, actual | 7.24 | ||||||
Payments of Debt Issuance Costs | $ 2,900,000 | ||||||
Line of Credit Facility, Periodic Payment, Interest | $ 16,700,000 | $ 16,700,000 | |||||
Debt Instrument, Interest Rate During Period | 5.40% | 5.00% | |||||
Line of Credit [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Long-term portion of long term debt | $ 283,125,000 | 148,125,000 | |||||
Credit facility amount | $ 700,000,000 | $ 600,000,000 | |||||
Component of Base Rate, Basis Spread on Federal Reserve Bank of New York (FRBNY) rate | 0.50% | ||||||
Component of Base Rate, Basis Spread on Adjusted LIBOR | 1.00% | ||||||
Investment limit in foreign subsidiaries | $ 100,000,000 | ||||||
Cash investment limit for acquisition of business | $ 200,000,000 | ||||||
Debt Instrument, Covenant Compliance, Leverage Ratio Four | 4.50 | ||||||
Minimum fixed charge coverage ratio allowed under debt covenant | 3 | ||||||
Debt Instrument, Covenant Compliance, maximum Senior Debt Leverage Ratio after covenant modification trigger event | 3 | ||||||
Line of Credit [Member] | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Line of Credit Facility, Variable Interest Rate, Length of Time Between Updates | 30 days | ||||||
Credit facility commitment fees percentage | 0.175% | ||||||
Line of Credit [Member] | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Line of Credit Facility, Variable Interest Rate, Length of Time Between Updates | 180 days | ||||||
Credit facility commitment fees percentage | 0.30% | ||||||
Secured Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Number of Banks in Credit Facility | bank | 16 | ||||||
London Interbank Offered Rate (LIBOR) [Member] | Line of Credit [Member] | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | ||||||
London Interbank Offered Rate (LIBOR) [Member] | Line of Credit [Member] | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 1.75% | ||||||
Base Rate [Member] | Line of Credit [Member] | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 0.25% | ||||||
Base Rate [Member] | Line of Credit [Member] | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 0.75% | ||||||
Scenario, Forecast [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Redemption Price, Percentage | 101.00% | ||||||
Other Noncurrent Assets | Line of Credit [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Unamortized Debt Issuance Expense | $ (3,600,000) | (3,800,000) | |||||
Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Unamortized Debt Issuance Expense | (4,641,000) | $ (4,857,000) | |||||
Debt Instrument, Fair Value Disclosure | $ 503,800,000 | ||||||
Revolving Loan, Reset Period One [Member] | Secured Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Line of Credit Facility, Interest Rate at Period End | 4.20% | ||||||
Subsequent Event [Member] | Foreign Subsidiary [Member] | Line of Credit [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Long-term portion of long term debt | $ 90,000,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 1 Months Ended | ||
Jul. 31, 2016 | Dec. 29, 2018 | Sep. 30, 2018 | |
Loss Contingencies [Line Items] | |||
Accounts receivable, net of allowance for doubtful accounts of $564 and $607 at December 29, 2018 and September 30, 2018, respectively | $ 385,670 | $ 129,297 | |
Pending Litigation | |||
Loss Contingencies [Line Items] | |||
Loss contingency accrual | 400 | ||
Korea | |||
Loss Contingencies [Line Items] | |||
Income tax examination, estimate of possible loss | $ 12,000 | ||
Minimum | Pending Litigation | |||
Loss Contingencies [Line Items] | |||
Loss Contingency, Estimate of Possible Loss | 500 | ||
Maximum | Pending Litigation | |||
Loss Contingencies [Line Items] | |||
Loss Contingency, Estimate of Possible Loss | $ 4,200 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2019 | Mar. 30, 2019 | Dec. 29, 2018 | Dec. 30, 2017 | |
Subsequent Event [Line Items] | ||||
Repayments of Lines of Credit | $ 20,000 | $ 20,000 | ||
Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Repayments of Lines of Credit | $ 25,000 | |||
Scenario, Forecast [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Payments for Repurchase of Common Stock | $ 65,000 |