Document and Entity Information
Document and Entity Information - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 19, 2019 | Jun. 30, 2018 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | TYL | ||
Entity Registrant Name | TYLER TECHNOLOGIES INC | ||
Entity Central Index Key | 860,731 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 38,293 | ||
Entity Public Float | $ 8,417,174 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues: | |||
Total revenues | $ 935,282 | $ 840,899 | $ 759,880 |
Cost of revenues: | |||
Total cost of revenues | 495,704 | 441,522 | 400,692 |
Gross profit | 439,578 | 399,377 | 359,188 |
Selling, general and administrative expenses | 207,605 | 175,914 | 165,176 |
Research and development expense | 63,264 | 47,324 | 43,154 |
Amortization of customer and trade name intangibles | 16,217 | 13,381 | 13,202 |
Operating income | 152,492 | 162,758 | 137,656 |
Other income (expense), net | 3,378 | 698 | (1,998) |
Income before income taxes | 155,870 | 163,456 | 135,658 |
Income tax provision (benefit) | 8,408 | (6,115) | 21,957 |
Net income | $ 147,462 | $ 169,571 | $ 113,701 |
Earnings per common share: | |||
Basic (USD per share) | $ 3.84 | $ 4.55 | $ 3.12 |
Diluted (USD per share) | $ 3.68 | $ 4.32 | $ 2.92 |
Software licenses and royalties | |||
Revenues: | |||
Total revenues | $ 93,441 | $ 86,242 | $ 83,733 |
Cost of revenues: | |||
Total cost of revenues | 3,802 | 3,321 | 2,964 |
Subscriptions | |||
Revenues: | |||
Total revenues | 220,547 | 172,176 | 142,657 |
Software services | |||
Revenues: | |||
Total revenues | 191,269 | 180,460 | 171,648 |
Maintenance | |||
Revenues: | |||
Total revenues | 384,521 | 359,319 | 320,998 |
Appraisal services | |||
Revenues: | |||
Total revenues | 21,846 | 25,023 | 26,287 |
Cost of revenues: | |||
Total cost of revenues | 14,299 | 16,286 | 16,411 |
Hardware and other | |||
Revenues: | |||
Total revenues | 23,658 | 17,679 | 14,557 |
Cost of revenues: | |||
Total cost of revenues | 15,708 | 12,595 | 10,143 |
Acquired software | |||
Cost of revenues: | |||
Total cost of revenues | 22,972 | 21,686 | 22,235 |
Software services, maintenance and subscriptions | |||
Cost of revenues: | |||
Total cost of revenues | $ 438,923 | $ 387,634 | $ 348,939 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 134,279 | $ 185,926 |
Accounts receivable (less allowance for losses of $4,647 in 2018 and $5,427 in 2017) | 298,912 | 246,188 |
Short-term investments | 44,306 | 43,159 |
Prepaid expenses | 33,258 | 32,206 |
Income tax receivable | 4,697 | 11,339 |
Other current assets | 3,406 | 1,997 |
Total current assets | 518,858 | 520,815 |
Accounts receivable, long-term | 16,020 | 12,107 |
Property and equipment, net | 155,177 | 152,315 |
Other assets: | ||
Goodwill | 753,718 | 657,987 |
Other intangibles, net | 276,852 | 229,617 |
Non-current investments and other assets | 70,338 | 38,510 |
Total assets | 1,790,963 | 1,611,351 |
Current liabilities: | ||
Accounts payable | 6,910 | 8,174 |
Accrued liabilities | 66,480 | 64,675 |
Deferred revenue | 350,512 | 298,613 |
Total current liabilities | 423,902 | 371,462 |
Revolving line of credit | 0 | 0 |
Deferred revenue, long-term | 424 | 1,274 |
Deferred income taxes | 41,791 | 46,879 |
Commitments and contingencies | ||
Shareholders' equity: | ||
Preferred stock, $10.00 par value; 1,000,000 shares authorized; none issued | 0 | 0 |
Common stock, $0.01 par value; 100,000,000 shares authorized; 48,147,969 shares issued in 2018 and 2017 | 481 | 481 |
Additional paid-in capital | 731,435 | 626,867 |
Accumulated other comprehensive loss, net of tax | (46) | (46) |
Retained earnings | 771,925 | 624,463 |
Treasury stock, at cost; 9,872,505 and 10,262,182 shares in 2018 and 2017, respectively | (178,949) | (60,029) |
Total shareholders' equity | 1,324,846 | 1,191,736 |
Liabilities and Shareholders' equity, Total | $ 1,790,963 | $ 1,611,351 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for losses | $ 4,647 | $ 5,427 |
Preferred stock, par value (in dollars per share) | $ 10 | $ 10 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 48,147,969 | 48,147,969 |
Treasury stock, shares | 9,872,505 | 10,262,182 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Treasury Stock |
Balance at Dec. 31, 2015 | $ 874,029 | $ 481 | $ 607,755 | $ (46) | $ 341,191 | $ (75,352) |
Balance, shares at Dec. 31, 2015 | 48,148 | (11,374) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 113,701 | 113,701 | ||||
Stock option exercises | $ 23,527 | (82,273) | $ 105,800 | |||
Issuance of shares pursuant to stock compensation plan, shares | 827 | 827 | ||||
Stock compensation | $ 29,747 | 29,747 | ||||
Issuance of shares pursuant to employee stock purchase plan | $ 6,236 | 1,434 | $ 4,802 | |||
Issuance of shares pursuant to employee stock purchase plan, shares | 47 | 47 | ||||
Treasury stock purchases | $ (112,699) | $ (112,699) | ||||
Treasury stock purchases, shares | (882) | (882) | ||||
Balance at Dec. 31, 2016 | $ 934,541 | $ 481 | 556,663 | (46) | 454,892 | $ (77,449) |
Balance, shares at Dec. 31, 2016 | 48,148 | (11,382) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 169,571 | 169,571 | ||||
Stock option exercises | $ 49,845 | 28,174 | $ 21,671 | |||
Issuance of shares pursuant to stock compensation plan, shares | 1,113 | 1,113 | ||||
Stock compensation | $ 37,348 | 37,348 | ||||
Issuance of shares pursuant to employee stock purchase plan | $ 7,044 | 4,682 | $ 2,362 | |||
Issuance of shares pursuant to employee stock purchase plan, shares | 51 | 51 | ||||
Treasury stock purchases | $ (6,613) | $ (6,613) | ||||
Treasury stock purchases, shares | (44) | (44) | ||||
Balance at Dec. 31, 2017 | $ 1,191,736 | $ 481 | 626,867 | (46) | 624,463 | $ (60,029) |
Balance, shares at Dec. 31, 2017 | 48,148 | (10,262) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 147,462 | 147,462 | ||||
Stock option exercises | $ 74,907 | 44,458 | $ 30,449 | |||
Issuance of shares pursuant to stock compensation plan, shares | 1,126 | 1,126 | ||||
Stock compensation | $ 52,740 | 52,740 | ||||
Issuance of shares pursuant to employee stock purchase plan | $ 8,051 | 7,370 | $ 681 | |||
Issuance of shares pursuant to employee stock purchase plan, shares | 45 | 45 | ||||
Treasury stock purchases | $ (150,050) | $ (150,050) | ||||
Treasury stock purchases, shares | (781) | (781) | ||||
Balance at Dec. 31, 2018 | $ 1,324,846 | $ 481 | $ 731,435 | $ (46) | $ 771,925 | $ (178,949) |
Balance, shares at Dec. 31, 2018 | 48,148 | (9,872) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||
Net income | $ 147,462 | $ 169,571 | $ 113,701 |
Adjustments to reconcile net income to cash provided by operations: | |||
Depreciation and amortization | 61,759 | 53,395 | 49,773 |
Share-based compensation expense | 52,740 | 37,348 | 29,747 |
Provision for losses - accounts receivable | 2,286 | 4,110 | 4,484 |
Deferred income tax benefit | (5,069) | (33,664) | (26,432) |
Changes in operating assets and liabilities, exclusive of effects of acquired companies: | |||
Accounts receivable | (53,771) | (35,170) | (34,760) |
Income tax receivable | 6,642 | (8,444) | 18,185 |
Prepaid expenses and other current assets | (588) | (6,958) | 246 |
Accounts payable | (2,416) | 878 | 387 |
Accrued liabilities | (2,445) | 6,050 | 10,717 |
Deferred revenue | 43,603 | 8,639 | 25,811 |
Net cash provided by operating activities | 250,203 | 195,755 | 191,859 |
Cash flows from investing activities: | |||
Cost of acquisitions, net of cash acquired | (178,093) | (11,344) | (9,394) |
Purchase of marketable security investments | (115,625) | (59,779) | (20,316) |
Proceeds from marketable security investments | 81,205 | 28,786 | 16,837 |
Additions to property and equipment | (27,424) | (43,057) | (37,726) |
Decrease (increase) in other | 1,682 | (1) | (121) |
Net cash used by investing activities | (238,255) | (85,395) | (50,720) |
Cash flows from financing activities: | |||
Decrease in net borrowings on revolving line of credit | 0 | (10,000) | (56,000) |
Purchase of treasury shares | (146,553) | (7,474) | (111,838) |
Contributions from employee stock purchase plan | 8,051 | 7,044 | 6,236 |
Proceeds from exercise of stock options | 74,907 | 49,845 | 23,527 |
Net cash (used) provided by financing activities | (63,595) | 39,415 | (138,075) |
Net (decrease) increase in cash and cash equivalents | (51,647) | 149,775 | 3,064 |
Cash and cash equivalents at beginning of period | 185,926 | 36,151 | 33,087 |
Cash and cash equivalents at end of period | $ 134,279 | $ 185,926 | $ 36,151 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES DESCRIPTION OF BUSINESS We provide integrated software systems and related services for the public sector, with a focus on local governments. We develop and market a broad line of software solutions and services to address the information technology (“IT”) needs of cities, counties, schools and other local government entities. In addition, we provide professional IT services, including software and hardware installation, data conversion, training, and for certain customers, product modifications, along with continuing maintenance and support for customers using our systems. We also provide subscription-based services such as software as a service (“SaaS”) arrangements, which primarily utilize the Tyler private cloud, and electronic document filing solutions (“e-filing”). In addition, we provide property appraisal outsourcing services for taxing jurisdictions. PRINCIPLES OF CONSOLIDATION The consolidated financial statements include our parent company and two subsidiaries, which are wholly-owned. All significant intercompany balances and transactions have been eliminated in consolidation. Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions, and other events and circumstances from non-owner sources and includes all components of net income (loss) and other comprehensive income (loss). We had no items of other comprehensive income (loss) during the years ended December 31, 2018 , 2017 and 2016 . CASH AND CASH EQUIVALENTS Cash in excess of that necessary for operating requirements is invested in short-term, highly liquid, income-producing investments. Investments with original maturities of three months or less are classified as cash and cash equivalents, which primarily consist of cash on deposit with several banks and money market funds. Cash and cash equivalents are stated at cost, which approximates market value. REVENUE RECOGNITION Nature of Products and Services We earn revenue from software licenses, royalties, subscription-based services, software services, post-contract customer support (“PCS” or “maintenance”), hardware, and appraisal services. Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. We determine revenue recognition through the following steps: • Identification of the contract, or contracts, with a customer • Identification of the performance obligations in the contract • Determination of the transaction price • Allocation of the transaction price to the performance obligations in the contract • Recognition of revenue when, or as, we satisfy a performance obligation Most of our software arrangements with customers contain multiple performance obligations that range from software licenses, installation, training, and consulting to software modification and customization to meet specific customer needs (services), hosting, and PCS. For these contracts, we account for individual performance obligations separately when they are distinct. We evaluate whether separate performance obligations can be distinct or should be accounted for as one performance obligation. Arrangements that include software services, such as training or installation, are evaluated to determine whether those services are highly interdependent or interrelated to the product’s functionality. The transaction price is allocated to the distinct performance obligations on a relative standalone selling price (“SSP”) basis. We determine the SSP based on our overall pricing objectives, taking into consideration market conditions and other factors, including the value of our contracts, the applications sold, customer demographics, and the number and types of users within our contracts. Revenue is recognized net of allowances for sales adjustments and any taxes collected from customers, which are subsequently remitted to governmental authorities. Software Arrangements: Software Licenses and Royalties Many of our software arrangements involve “off-the-shelf” software. We recognize the revenue allocable to "off-the-shelf" software licenses and specified upgrades at a point in time when control of the software license transfers to the customer, unless the software is not considered distinct. We consider off-the-shelf software to be distinct when it can be added to an arrangement with minor changes in the underlying code, it can be used by the customer for the customer’s purpose upon installation, and remaining services such as training are not considered highly interdependent or interrelated to the product's functionality. For arrangements that involve significant production, modification or customization of the software, or where software services are otherwise not considered distinct, we recognize revenue over time by measuring progress-to-completion. We measure progress-to-completion primarily using labor hours incurred as it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. These arrangements are often implemented over an extended period and occasionally require us to revise total cost estimates. Amounts recognized in revenue are calculated using the progress-to-completion measurement after giving effect to any changes in our cost estimates. Changes to total estimated contract costs, if any, are recorded in the period they are determined. Estimated losses on uncompleted contracts are recorded in the period in which we first determine that a loss is apparent. Software license fees are billed in accordance with the contract terms. Typically, a majority of the fee is due when access to the software license is made available to the customer and the remainder of the fee due over a passage of time stipulated by the contract. We record amounts that have been invoiced in accounts receivable and in deferred revenue or revenues, depending on whether the revenue recognition criteria have been met. We recognize royalty revenue when the sale occurs under the terms of our third-party royalty arrangements. Currently, our third-party royalties are recognized on an estimated basis and are trued up when we receive notice of amounts we are entitled to receive. We typically receive notice of royalty revenues we are entitled to and billed on a quarterly basis in the quarter immediately following the royalty reporting period. Software Services As noted above, some of our software arrangements include services considered highly interdependent or highly interrelated or require significant customization to meet the customer's desired functionality. For these software arrangements, both the software licenses and related software services revenue are not distinct and are recognized over time using the progress-to-completion method. We measure progress-to-completion primarily using labor hours incurred as it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. Contract fees are typically billed on a milestone basis as defined within contract terms. We record amounts that have been invoiced in accounts receivable and in deferred revenue or revenues, depending on whether the revenue recognition criteria have been met. When software services are distinct, the fee allocable to the service element is recognized over the time we perform the services and is billed on a time and material basis. Post-Contract Customer Support Our customers generally enter into PCS agreements when they purchase our software licenses. PCS includes telephone support, bug fixes, and rights to upgrades on a when-and-if available basis. PCS is considered distinct when purchased with our software licenses. Our PCS agreements are typically renewable annually. PCS is recognized over time on a straight-line basis over the period the PCS is provided. All significant costs and expenses associated with PCS are expensed as incurred. Computer Hardware Equipment Revenue allocable to computer hardware equipment is recognized at a point in time when control of the equipment is transferred to the customer. Subscription-Based Services: Subscription-based services consist of revenues derived from SaaS arrangements, which primarily utilize the Tyler private cloud, and electronic filing transactions. Revenue from subscription-based services is generally recognized over time on a ratable basis over the contract term, beginning on the date that our service is made available to the customer. Our subscription contracts are generally three to five years or longer in length, billed annually in advance, and non-cancelable. For SaaS arrangements, we evaluate whether the customer has the contractual right to take possession of our software at any time during the hosting period without significant penalty and whether the customer can feasibly maintain the software on the customer’s hardware or enter into another arrangement with a third-party to host the software. We allocate contract value to each performance obligation of the arrangement that qualifies for treatment as a distinct element based on estimated SSP. When it is determined that software is distinct, and the customer has the ability to take control of the software, we recognize revenue allocable to the software license fee when access to the software license is made available to the customer. We recognize hosting services ratably over the term of the arrangement, which range from one to ten years but are typically for a period of three to five years. For software services associated with certain SaaS arrangements, we have concluded that the services are not distinct, and we recognize the revenue ratably over the remaining contractual period once we have provided the customer access to the software. We record amounts that have been invoiced in accounts receivable and in deferred revenue or revenues, depending on whether the revenue recognition criteria have been met. Electronic filing transaction fees primarily pertain to documents filed with the courts by attorneys and other third-parties via our e-filing services and retrieval of filed documents via our access services. For each document filed with a court, the filer generally pays a transaction fee and a court filing fee to us and we remit a portion of the transaction fee and the filing fee to the court. We record as revenue the transaction fee, while the portion of the transaction fee remitted to the courts is recorded as cost of sales as we are acting as a principal in the arrangement. Court filing fees collected on behalf of the courts and remitted to the courts are recorded on a net basis and thus do not affect the statement of comprehensive income. For e-filing transaction fees, we have the right to charge the customer an amount that directly corresponds with the value to the customer of our performance to date. Therefore, we recognize revenue for these services over time based on the amount billable to the customer in accordance with the 'as invoiced' practical expedient in ASC 606-10-55-18. In some cases, we are paid on a fixed fee basis and recognize the revenue ratably over the contractual period. Costs of performing services under subscription-based arrangements are expensed as incurred, except for certain direct and incremental contract origination and set-up costs associated with SaaS arrangements. Such direct and incremental costs are capitalized and amortized ratably over the useful life. Appraisal Services: For our property appraisal projects, we recognize revenue using the progress-to-completion method since many of these projects are implemented over one to three -year periods and consist of various unique activities. Appraisal services require a significant level of integration and interdependency with various individual service components; therefore, the service components are not considered distinct. Appraisal services are recognized over time by measuring progress-to-completion primarily using labor hours incurred as it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. These arrangements are often implemented over an extended period and occasionally require us to revise total cost estimates. Amounts recognized in revenue are calculated using the progress-to-completion measurement after giving effect to any changes in our cost estimates. Changes to total estimated contract costs, if any, are recorded in the period they are determined. Estimated losses on uncompleted contracts are recorded in the period in which we first determine that a loss is apparent. Contract fees are typically billed on a milestone basis as defined within contract terms. We record amounts that have been invoiced in accounts receivable and in deferred revenue or revenues, depending on whether the revenue recognition criteria have been met. Significant Judgments: Our contracts with customers often include multiple performance obligations to a customer. When a software arrangement (license or subscription) includes both software licenses and software services, judgment is required to determine whether the software license is considered distinct and accounted for separately, or not distinct and accounted for together with the software services and recognized over time. The transaction price is allocated to the separate performance obligations on a relative SSP basis. We determine the SSP based on our overall pricing objectives, taking into consideration market conditions and other factors, including the value of our contracts, the applications sold, customer demographics, and the number and types of users within our contracts. We use a range of amounts to estimate SSP when we sell each of the products and services separately and need to determine whether there is a discount to be allocated based on the relative SSP of the various products and services. In instances where SSP is not directly observable, such as when we do not sell the product or service separately, we determine SSP using the expected cost-plus margin approach. For arrangements that involve significant production, modification or customization of the software, or where software services otherwise cannot be considered distinct, we recognize revenue as control is transferred to the customer over time using progress-to-completion methods. Depending on the contract, we measure progress-to-completion primarily using labor hours incurred, or value added. The progress-to-completion method generally results in the recognition of reasonably consistent profit margins over the life of a contract because we can provide reasonably dependable estimates of contract billings and contract costs. We use the level of profit margin that is most likely to occur on a contract. If the most likely profit margin cannot be precisely determined, the lowest probable level of profit margin in the range of estimates is used until the results can be estimated more precisely. These arrangements are often implemented over an extended time period and occasionally require us to revise total cost estimates. Amounts recognized in revenue are calculated using the progress-to-completion measurement after giving effect to any changes in our cost estimates. Changes to total estimated contract costs, if any, are recorded in the period they are determined. Estimated losses on uncompleted contracts are recorded in the period in which we first determine that a loss is apparent. Typically, the structure of our arrangements does not give rise to variable consideration. However, in those instances whereby variable consideration exists, we include in our estimates additional revenue for variable consideration when we believe we have an enforceable right, the amount can be estimated reliably and its realization is probable. Refer to Note 15 - Disaggregation of Revenue for further information, including the economic factors that affect the nature, amount, timing, and uncertainty of revenue and cash flows of our various revenue categories. Contract Balances: Accounts receivable and allowance for doubtful accounts Timing of revenue recognition may differ from the timing of invoicing to customers. We record an unbilled receivable when revenue is recognized prior to invoicing, or deferred revenue when revenue is recognized subsequent to invoicing. For multi-year agreements, we generally invoice customers annually at the beginning of each annual coverage period. We record an unbilled receivable related to revenue recognized for on-premises licenses as we have an unconditional right to invoice and receive payment in the future related to those licenses. We maintain allowances for doubtful accounts, which are provided at the time the revenue is recognized. Since most of our customers are domestic governmental entities, we rarely incur a loss resulting from the inability of a customer to make required payments. Events or changes in circumstances that indicate the carrying amount for the allowances for doubtful accounts may require revision include, but are not limited to, deterioration of a customer’s financial condition, failure to manage our customer’s expectations regarding the scope of the services to be delivered, and defects or errors in new versions or enhancements of our software products. The following table summarizes the changes in the allowances for doubtful accounts and sales adjustments: Years Ended December 31, 2018 2017 2016 Balance at beginning of year $ 5,427 $ 3,396 $ 1,640 Provisions for losses - accounts receivable 2,286 4,110 4,484 Collection of accounts previously written off — — — Deductions for accounts charged off or credits issued (3,066 ) (2,079 ) (2,728 ) Balance at end of year $ 4,647 $ 5,427 $ 3,396 The allowance for doubtful accounts reflects our best estimate of probable losses inherent in the accounts receivable balance. We determine the allowance based on known troubled accounts, historical experience, and other currently available evidence. In connection with our appraisal services contracts and certain software services contracts, we may perform work prior to when the software and services are billable and/or payable pursuant to the contract. Unbilled revenue is not billable at the balance sheet date but is recoverable over the remaining life of the contract through billings made in accordance with contractual agreements. The termination clauses in most of our contracts provide for the payment for the value of products delivered or services performed in the event of early termination. We have historically recorded such unbilled receivables (costs and estimated profit in excess of billings) in connection with (1) property appraisal services contracts accounted for using progress-to-completion method of revenue recognition using labor hours as a measure of progress towards completion in which the services are performed in one accounting period but the billing normally occurs subsequently and may span another accounting period; (2) software services contracts accounted for using progress-to-completion method of revenue recognition using labor hours as a measure of progress towards completion in which the services are performed in one accounting period but the billing for the software element of the arrangement may be based upon the specific phase of the implementation; (3) software revenue for which we have recognized revenue at the point in time when the software is made available to the customer but the billing has not yet been submitted to the customer; (4) some of our contracts which provide for an amount to be withheld from a progress billing (generally between 5% and 20% retention) until final and satisfactory project completion is achieved; and (5) in a limited number of cases, extended payment terms, which may be granted to customers with whom we generally have a long-term relationship and favorable collection history. The opening balance of current and long-term accounts receivable, net of allowance for doubtful accounts, was $226.8 million (as adjusted) as of January 1, 2017. As of December 31, 2018 , and December 31, 2017 , total current and long-term accounts receivable, net of allowance for doubtful accounts, was $314.9 million and $258.3 million (as adjusted), respectively. We have recorded unbilled receivables of $104.2 million and $64.6 million (as adjusted) at December 31, 2018 , and December 31, 2017 , respectively. Included in unbilled receivables are retention receivables of $12.2 million and $7.2 million at December 31, 2018 , and December 31, 2017 , respectively, which become payable upon the completion of the contract or completion of our fieldwork and formal hearings. Unbilled receivables expected to be collected within one year have been included with accounts receivable, current portion in the accompanying consolidated balance sheets. Unbilled receivables and retention receivables expected to be collected past one year have been included with accounts receivable, long-term portion in the accompanying consolidated balance sheets. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 to 60 days. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined our contracts generally do not include a significant financing component. The primary purpose of our invoicing terms is to provide customers with simplified and predictable ways of purchasing our products and services, not to receive financing from our customers or to provide customers with financing. Examples include invoicing at the beginning of a subscription term with revenue recognized ratably over the contract period, and multi-year on-premises term licenses that are invoiced annually with revenue recognized upfront. Deferred Revenue The majority of deferred revenue consists of deferred maintenance revenue that has been billed based on contractual terms in the underlying arrangement, with the remaining balance consisting of payments received in advance of revenue being earned under software licensing, subscription-based services, software and appraisal services and hardware installation. Refer to Note 16 - Deferred Revenue and Performance Obligations for further information, including deferred revenue by segment and changes in deferred revenue during the period. Deferred Commissions Sales commissions earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions for initial contracts are deferred and then amortized on a straight-line basis over a period of benefit that we have determined to be three to seven years. We utilized the 'portfolio approach' practical expedient in ASC 606-10-10-4, which allows entities to apply the guidance to a portfolio of contracts with similar characteristics because the effects on the financial statements of this approach would not differ materially from applying the guidance to individual contracts. Using the 'portfolio approach', we determined the period of benefit by taking into consideration our customer contracts, our technology life-cycle and other factors. Sales commissions for renewal contracts are generally not paid in connection with the renewal of a contract. In the small number of instances where a commission is paid on a renewal, it is not commensurate with the commission paid on the initial sale and is recognized over the term of renewal, which is generally one year. Amortization expense related to deferred commissions is included in selling, general and administrative expenses in the accompanying consolidated statements of income. Refer to Note 17 - Deferred Commissions for further information. Prepaid expenses and other current assets include direct and incremental costs such as commissions associated with arrangements for which revenue recognition has been deferred. Such costs are expensed at the time the related revenue is recognized. USE OF ESTIMATES The preparation of our financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include revenue recognition, determining the nature and timing of satisfaction of performance obligations, and determining the SSP of performance obligations, variable consideration, and other obligations such as returns and refunds; loss contingencies; the estimated useful life of deferred commissions; the carrying amount and estimated useful lives of intangible assets; determining share-based compensation expense; the valuation allowance for receivables; and determining the potential outcome of future tax consequences of events that have been recognized on our consolidated financial statements or tax returns. Actual results could differ from estimates. PROPERTY AND EQUIPMENT, NET Property, equipment and purchased software are recorded at original cost and increased by the cost of any significant improvements after purchase. We expense maintenance and repairs when incurred. Depreciation and amortization is calculated using the straight-line method over the shorter of the asset’s estimated useful life or the term of the lease in the case of leasehold improvements. For income tax purposes, we use accelerated depreciation methods as allowed by tax laws. RESEARCH AND DEVELOPMENT COSTS We expensed research and development costs of $63.3 million in 2018 , $47.3 million in 2017 , and $43.2 million in 2016 . INCOME TAXES Income taxes are accounted for under the asset and liability method. Deferred taxes arise because of different treatment between financial statement accounting and tax accounting, known as “temporary differences.” We record the tax effect of these temporary differences as “deferred tax assets” (generally items that can be used as a tax deduction or credit in the future periods) and “deferred tax liabilities” (generally items that we received a tax deduction for, which have not yet been recorded in the income statement). The deferred tax assets and liabilities are measured using enacted tax rules and laws that are expected to be in effect when the temporary differences are expected to be recovered or settled. A valuation allowance would be established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be "realized." On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act amends the Internal Revenue Code to reduce tax rates and modify policies, credits and deductions for individuals and businesses. For businesses, the Tax Act reduces the corporate U.S. federal tax rate from a maximum of 35% to a flat 21% rate and transitions from a worldwide tax system to a territorial tax system. Under ASC 740 Income Taxes, the effects of changes in tax rates and laws are recognized in the period in which the new legislation is enacted. See Note 7 - "Income Tax" for further discussion related to the Tax Act. SHARE-BASED COMPENSATION We have a share-based award plan that provides for the grant of stock options, restricted stock units, and performance share units to key employees, directors and non-employee consultants. Stock options generally vest after three to six years of continuous service from the date of grant and have a contractual term of 10 years. Restricted stock unit grants generally vest ratably over three to five years of continuous service from the date of grant. Each performance share unit represents the right to receive one share of our common stock based on our achievement of certain financial performance targets during applicable performance periods. We account for share-based compensation utilizing the fair value recognition pursuant to ASC 718, Stock Compensation . See Note 9 – “Share-Based Compensation” for further information. GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill Goodwill represents the excess of the purchase price over the fair value of net assets acquired, including identifiable intangible assets, in connection with our business combinations. Upon acquisition, goodwill is assigned to the reporting unit that is expected to benefit from the synergies of the business combination, which is the reporting unit to which the related acquired technology is assigned. A reporting unit is the operating segment, or a business unit one level below that operating segment, for which discrete financial information is prepared and regularly reviewed by executive management. We assess goodwill for impairment annually as of April 1st, or more frequently whenever events or changes in circumstances indicate its carrying value may not be recoverable. We begin with the qualitative assessment of whether it is more likely than not that a reporting unit's fair value is less than its carrying value before applying the quantitative assessment described below. If it is determined through the evaluation of events or circumstances that the carrying value may not be recoverable, we perform a comparison of the estimated fair value of the reporting unit to which the goodwill has been assigned to the sum of the carrying value of the assets and liabilities of that unit. If the sum of the carrying value of the assets and liabilities of a reporting unit exceeds the estimated fair value of that reporting unit, the carrying value of the reporting unit's goodwill is reduced to its fair value through an adjustment to the goodwill balance, resulting in an impairment charge. The fair values calculated in our impairment tests are determined using discounted cash flow models involving several assumptions. The assumptions that are used are based upon what we believe a hypothetical marketplace participant would use in estimating fair value. We evaluate the reasonableness of the fair value calculations of our reporting units by comparing the total of the fair value of all of our reporting units to our total market capitalization. We did not record any goodwill impairment charges for the years ended December 31, 2018 and 2017 . See Note 4 - Goodwill and Other Intangible Assets, for additional information. Other Intangible Assets We make judgments about the recoverability of purchased intangible assets other than goodwill whenever events or changes in circumstances indicate that an impairment may exist. Customer base and acquired software each comprise approximately half of our purchased intangible assets other than goodwill. We review our customer turnover each year for indications of impairment. Our customer turnover has historically been very low. If indications of impairment are determined to exist, we measure the recoverability of assets by a comparison of the carrying amount of the asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the assets exceeds their estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the assets exceeds the fair value of the assets. There have been no significant impairments of intangible assets in any of the periods presented. IMPAIRMENT OF LONG-LIVED ASSETS We periodically evaluate whether current facts or circumstances indicate that the carrying value of our property and equipment or other long-lived assets to be held and used may not be recoverable. If such circumstances are determined to exist, we measure the recoverability of assets to be held and used by a comparison of the carrying amount of the asset or appropriate grouping of assets and the estimated undiscounted future cash flows expected to be generated by the assets. If the carrying amount of the assets exceeds their estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell, and would no longer be depreciated. The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the balance sheet. There have been no significant impairments of long-lived assets in an |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | ACQUISITIONS 2018 On December 7, 2018, we acquired certain assets and intellectual property of SceneDoc, Inc.("SceneDoc"), a company that provides mobile-first, SaaS field reporting for law enforcement agencies. The total purchase price was approximately $6.2 million , of which $5.4 million was paid in cash and approximately $759,000 accrued for a working capital holdback, subject to certain post-closing adjustments. On October 1, 2018, we acquired all of the equity interests of TradeMaster, Inc. dba MobileEyes ("MobileEyes"), a company that develops SaaS software to improve public safety by supporting fire prevention and suppression, emergency response, and structural safety. The total purchase price was approximately $5.3 million in cash. On August 31, 2018, we acquired all of the assets of CaseloadPRO, L. P., a company that provides a fully featured SaaS probation case management system. The purchase price of $9.3 million was paid in cash. On April 30, 2018, we acquired all of the capital stock of Socrata, Inc. ("Socrata"), a company that provides open data and data-as-a-service solutions including cloud-based data integration, visualization, analysis, and reporting solutions for state and local government agencies. The purchase price, net of cash acquired of $1.7 million , was $147.6 million paid in cash. We have performed a valuation analysis of the fair market value of Socrata’s assets and liabilities. The following table summarizes the allocation of the purchase price as of the acquisition date: In thousands Cash $ 1,724 Accounts receivable 3,616 Other current assets 2,057 Other noncurrent assets 68 Deferred tax assets, net 20 Identifiable intangible assets 75,000 Goodwill 75,657 Accounts payable (1,254 ) Accrued expenses (1,604 ) Deferred revenue (5,915 ) Total consideration $ 149,369 In connection with this transaction, we acquired total tangible assets of $7.5 million and assumed liabilities of approximately $8.8 million . We recorded goodwill of $75.7 million , none of which is expected to be deductible for tax purposes, and other identifiable intangible assets of approximately $75.0 million . The $75.0 million of intangible assets are attributable to customer relationships, acquired software, and trade name and will be amortized over a weighted average period of approximately 14 years. We recorded deferred tax assets, net of approximately $20,000 related to estimated fair value allocations. Socrata’s solutions are a direct complement to our current offerings and will provide a new and important additional revenue stream. By offering Socrata within virtually every Tyler product suite, our clients will have the opportunity to make their existing data discoverable, usable and actionable, but more importantly, potentially include data from other agencies and jurisdictions to make analysis even more powerful and meaningful. Therefore, the goodwill of $75.7 million arising from this acquisition is primarily attributed to our ability to integrate Socrata's solutions with our existing portfolio and to generate increased revenues, earnings and cash flow by leveraging our sales resources and client base. Our final valuation of the fair market value of Socrata's assets and liabilities resulted in adjustments to the preliminary opening balance sheet. These adjustments related to a reduction in deferred income taxes and accrued expenses resulting in a net decrease to goodwill of approximately $3.3 million . We also incurred fees of approximately $578,000 for financial advisory, legal, accounting, due diligence, valuation and other various services necessary to complete the acquisition. These fees were expensed in 2018 and are included in selling, general and administrative expenses. The following unaudited pro forma information of the consolidated results of operations have been prepared as if the Socrata acquisition had occurred at January 1, 2017, after giving effect to certain adjustments, including amortization of intangibles, interest, transaction costs and tax effects. Twelve Months Ended December 31, 2018 2017 Revenues $ 943,723 $ 865,944 Net income 139,315 150,515 Basic earnings per share 3.62 4.04 Diluted earnings per share $ 3.47 $ 3.84 Pro forma information above does not include acquisitions that are not considered material to our results of operations. The pro forma information does not purport to represent what our results of operations actually would have been had such transaction or event occurred on the dates specified, or to project our results of operations for any future period. On April 30, 2018, we acquired all of the equity interests of Sage Data Security, LLC ("Sage"), a cybersecurity company offering a suite of services that supports an entire cybersecurity lifecycle, including program development, education and training, technical testing, advisory services, and digital forensics. The total purchase price was $11.6 million paid in cash. Tyler has performed a valuation analysis of the fair market value of Sage's assets and liabilities. As a result, we acquired total tangible assets of approximately $1.8 million and assumed liabilities of approximately $730,000 . We have recorded total goodwill of approximately $3.5 million , all of which is expected to be deductible for tax purposes, and other intangible assets of approximately $7.0 million . The $7.0 million of intangible assets is attributable to customer relationships, acquired software and trade name and will be amortized over a weighted average period of approximately 14 years. As of December 31, 2018 , the purchase price allocations for Sage, Socrata, CaseloadPro, and MobileEyes are complete. As of December 31, 2018 , the purchase price allocation for SceneDoc is not yet complete, therefore the preliminary valuation estimates of fair value assumed at the acquisition date for intangible assets, receivables and deferred revenue and related deferred taxes are subject to change as valuations are finalized. The operating results of all 2018 acquisitions are included with the operating results of the Enterprise Software segment since their date of acquisition. Revenues from Socrata included in Tyler's results of operations totaled approximately $13.9 million and the net loss was $11.5 million for the twelve months ended December 31, 2018 . The impact of the Sage, CaseloadPRO, MobileEyes and SceneDoc acquisitions, individually and in the aggregate, on our operating results, assets and liabilities is not material. Our balance sheet as of December 31, 2018 , reflects the allocation of the purchase price to the assets acquired based on their fair value at the date of each acquisition. The fair value of the assets and liabilities acquired are based on valuations using Level III, unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. 2017 On November 29, 2017 , we acquired audio and digital two-way radio communications technology and related assets from Radio 10-33, LLC . The total purchase price was $1.4 million , all of which was paid in cash. On August 2, 2017 , we acquired substantially all of the assets and assumed certain liabilities of Digital Health Department, Inc. ("DHD"), a company that provides environmental health software, offering a SaaS solution for public health compliance and inspections processes. The total purchase price, net of debt assumed, was $3.9 million , all of which was paid in cash. On May 30, 2017 , we acquired all of the capital stock of Modria.com, Inc. , a company that specializes in online dispute resolution for government and commercial entities. The total purchase price, net of debt assumed, was $7.0 million , of which $6.1 million was paid in cash and $900,000 was accrued as of December 31, 2017 . The operating results of these acquisition are included in our results of operations of the Enterprise Software segment from their respective dates of acquisition. The impact of these acquisitions, individually and in the aggregate, on our operating results, assets and liabilities is not material. 2016 On May 31, 2016 , we acquired all of the capital stock of ExecuTime Software, LLC , a leading provider of time, attendance, and advanced scheduling software solutions. The total purchase price, net of debt assumed, was $7.4 million . The fair value of the assets and liabilities acquired are based on valuations using Level III, unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The operating results of this acquisition are included in our results of operations of the Enterprise Software segment from the date of the acquisition. The impact of this acquisition on our operating results is not material. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | PROPERTY AND EQUIPMENT, NET Property and equipment, net consists of the following at December 31: Useful Lives (years) 2018 2017 Land — $ 9,958 $ 9,958 Building and leasehold improvements 5-39 122,241 116,214 Computer equipment and purchased software 3-5 84,649 72,531 Furniture and fixtures 5 27,238 24,834 Transportation equipment 5 438 476 244,524 224,013 Accumulated depreciation and amortization (89,347 ) (71,698 ) Property and equipment, net $ 155,177 $ 152,315 Depreciation expense was $21.2 million in 2018 , $17.3 million in 2017 , and $13.4 million in 2016 . In 2018 , we paid $2.2 million for the expansion of existing buildings. In 2017 , we purchased an office building in Latham, New York for approximately $2.9 million and paid $2.1 million for improvements to that building. We also paid $19.4 million for construction to expand our office building in Yarmouth, Maine. We own office buildings in Bangor, Falmouth and Yarmouth, Maine; Lubbock and Plano, Texas; Troy, Michigan; Latham, New York; and Moraine, Ohio. We lease space in some of these buildings to third-party tenants. These leases expire between 2019 and 2025 and are expected to provide rental income of approximately $1.3 million in 2019 , $1.3 million in 2020 , $1.3 million in 2021 , $1.4 million in 2022 , $1.4 million in 2023 , and $2.4 million thereafter. Rental income from third-party tenants was $1.2 million in 2018 , $1.5 million in 2017 , and $1.7 million in 2016 . |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS Other intangible assets and related accumulated amortization consists of the following at December 31: 2018 2017 As Adjusted Gross carrying amount of acquisition intangibles: Customer related intangibles $ 238,219 $ 179,789 Acquired software 202,416 179,466 Trade names 16,905 11,435 Leases acquired 3,694 3,694 461,234 374,384 Accumulated amortization (184,382 ) (144,767 ) Total intangibles, net $ 276,852 $ 229,617 Total amortization expense for intangibles was $39.6 million in 2018 , $35.5 million (as adjusted) in 2017 , and $35.9 million (as adjusted) during 2016 . The allocation of acquisition intangible assets is summarized in the following table: December 31, 2018 December 31, 2017 As Adjusted Gross Carrying Amount Weighted Average Amortization Period Accumulated Amortization Gross Carrying Amount Weighted Average Amortization Period Accumulated Amortization Non-amortizable intangibles: Goodwill $ 753,718 — $ — $ 657,987 — $ — Amortizable intangibles: Customer related intangibles 238,219 15 years 78,120 179,789 15 years 63,274 Acquired software 202,416 7 years 99,772 179,466 7 years 76,800 Trade names 16,905 11 years 5,139 11,435 11 years 3,768 Leases acquired 3,694 10 years 1,351 3,694 10 years 925 The changes in the carrying amount of goodwill for the two years ended December 31, 2018 are as follows: Enterprise Software Appraisal and Tax Total Balance as of 12/31/2016 $ 643,680 $ 6,557 $ 650,237 Goodwill acquired with acquisitions 7,750 — 7,750 Balance as of 12/31/2017 651,430 6,557 657,987 Goodwill acquired related to the purchase of Socrata 75,657 — 75,657 Goodwill acquired related to other acquisitions 20,074 — 20,074 Balance as of 12/31/2018 $ 747,161 $ 6,557 $ 753,718 Estimated annual amortization expense related to acquired leases will be recorded as a reduction to hardware and other revenue and is expected to be $372,000 in 2019 , $313,000 in 2020 , $312,000 in 2021 , $312,000 in 2022 , $312,000 in 2023 and $723,000 thereafter . Estimated annual amortization expense related to acquisition intangibles, including acquired software, for which the amortization expense is recorded as cost of revenues, is as follows: 2019 $ 40,222 2020 38,820 2021 38,463 2022 34,987 2023 16,990 Thereafter 105,028 |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Dec. 31, 2018 | |
Accrued Liabilities, Current [Abstract] | |
Accrued Liabilities | ACCRUED LIABILITIES Accrued liabilities consist of the following at December 31: 2018 2017 Accrued wages, bonuses and commissions $ 40,100 $ 43,688 Other accrued liabilities 26,380 20,987 $ 66,480 $ 64,675 |
Revolving Line of Credit
Revolving Line of Credit | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Revolving Line of Credit | REVOLVING LINE OF CREDIT On November 16, 2015 , we entered into a $300.0 million Credit Agreement (the “Credit Facility”) with the various lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent. The Credit Facility provides for a revolving credit line of up to $ 300.0 million , including a $10.0 million sublimit for letters of credit. The Credit Facility matures on November 16, 2020 . Borrowings under the Credit Facility may be used for general corporate purposes, including working capital requirements, acquisitions and share repurchases. Borrowings under the Credit Facility bear interest at a rate of either (1) Wells Fargo Bank’s prime rate (subject to certain higher rate determinations) plus a margin of 0.25% to 1.00% or (2) the 30, 60, 90 or 180-day LIBOR rate plus a margin of 1.25% to 2.00% . As of December 31, 2018 , our interest rate was 5.75% under the prime rate option or approximately 3.77% under the 30-day LIBOR option. The Credit Facility is secured by substantially all our assets. The Credit Facility requires us to maintain certain financial ratios and other financial conditions and prohibits us from making certain investments, advances, cash dividends or loans, and limits incurrence of additional indebtedness and liens. As of December 31, 2018 , we were in compliance with those covenants . As of December 31, 2018 , we had no outstanding borrowings and had unused borrowing capacity of $300.0 million under the Credit Facility . In addition, as of December 31, 2018 , we had no outstanding letter of credit. We paid interest of $770,000 in 2018 , $804,000 in 2017 , and $1.9 million in 2016 . |
Income Tax
Income Tax | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax | INCOME TAX The Income tax provision (benefit) on income from operations consists of the following: Years Ended December 31, 2018 2017 2016 As Adjusted As Adjusted Current: Federal $ 9,110 $ 22,883 $ 41,366 State 4,367 4,666 7,023 13,477 27,549 48,389 Deferred (5,069 ) (33,664 ) (26,432 ) $ 8,408 $ (6,115 ) $ 21,957 Reconciliation of the U.S. statutory income tax rate to our effective income tax expense rate for operations follows: Years Ended December 31, 2018 2017 2016 As Adjusted As Adjusted Federal income tax expense at statutory rate $ 32,733 $ 57,209 $ 47,480 State income tax, net of federal income tax benefit 7,953 4,754 5,091 Domestic production activities deduction — (2,617 ) (3,947 ) Excess tax benefits related to stock option exercises (32,487 ) (40,624 ) (29,582 ) Tax Act adjustments (1,750 ) (25,992 ) — Tax credits (3,715 ) (3,578 ) — Non-deductible business expenses 5,655 4,573 2,979 Other, net 19 160 (64 ) $ 8,408 $ (6,115 ) $ 21,957 On December 22, 2017, the Tax Act was enacted into law. The Tax Act amends the Internal Revenue Code to reduce tax rates and modify policies, credits and deductions for individuals and businesses. For businesses, the Tax Act reduces the U.S. corporate federal tax rate from a maximum of 35% to a flat 21% rate and transitions from a worldwide tax system to a territorial tax system. The Tax Act also adds many new provisions including changes to bonus depreciation, the deduction for executive compensation and a tax on global intangible low-taxed income (GILTI). The most significant impact of the Tax Act to us is the reduction in the U.S. federal corporate income tax rate from 35% to 21%. The impact of the rate reduction on our 2017 income tax provision was a $26.0 million (as adjusted) tax benefit due to the remeasurement of deferred tax assets and liabilities. We recorded an additional $1.8 million tax benefit in 2018 after our 2017 tax returns were finalized. The accounting for the income tax effects of the Tax Act was completed during the fourth quarter of 2018. Overall, the changes due to the Tax Act will favorably affect income tax expense and future U.S. earnings. The tax effects of the major items recorded as deferred tax assets and liabilities as of December 31 are: 2018 2017 As Adjusted Deferred income tax assets: Operating expenses not currently deductible $ 8,989 $ 9,714 Stock option and other employee benefit plans 19,496 15,932 Loss and credit carryforwards 17,999 — Total deferred income tax assets 46,484 25,646 Valuation allowance (1,049 ) — Total deferred income tax assets, net of valuation allowance 45,435 25,646 Deferred income tax liabilities: Intangible assets (70,752 ) (60,189 ) Property and equipment (8,455 ) (5,699 ) Prepaid expenses (4,079 ) (190 ) Deferred revenue (3,940 ) (6,447 ) Total deferred income tax liabilities (87,226 ) (72,525 ) Net deferred income tax liabilities $ (41,791 ) $ (46,879 ) The above 2017 balances reflect an $8.0 million deferred tax liability related to the recognition of revenue as part of the adoption of ASU No. 2014-09. During 2018, we acquired federal and state net operating loss and tax credit carryforwards totaling $18.0 million in connection with the acquisition of Socrata. The federal and state net operating loss and tax credit carryforwards will expire in various years beginning in 2027, if not utilized. The acquired net operating loss and tax credit carryforwards are subject to an annual limitation but are expected to be realized with the exception of certain state net operating loss carryforwards. The valuation allowance disclosed in the table above relates to state net operating losses not likely to be realized. We believe it is more likely than not that all other deferred tax assets will be realized. However, the amount of the deferred tax asset considered realizable could be adjusted in the future if estimates of reversing taxable temporary differences are revised. In connection with the acquisition of Socrata in 2018, we recorded a $1.9 million liability for an uncertain tax position associated with acquired tax credit carryforwards. The unrecognized tax benefits are included in deferred income taxes in our consolidated balance sheets and are reflected in the opening balance sheet of Socrata. The entire amount, if recognized, would affect the effective tax rate. The aggregate changes in the balance of unrecognized tax benefits were as follows: 2018 Balance at beginning of year $ — Increases for tax positions related to prior years 1,929 Balance at end of year $ 1,929 Based on the information currently available, we do not anticipate a significant increase or decrease to our tax contingencies for these issues for the next 12 months. We are subject to U.S. federal tax, as well as income tax of multiple state, local and foreign jurisdictions. We are routinely subject to income tax examinations by these taxing jurisdictions, but we do not have a history of, nor do we expect any material adjustments as a result of these examinations. During 2017, the Internal Revenue Service issued a “no change” letter upon completion of their examination of our 2012 tax year. With few exceptions, major U.S. federal, state, local and foreign jurisdictions are no longer subject to examination for years before 2014. As of February 20, 2019 , no significant adjustments have been proposed by any taxing jurisdiction. We paid income taxes, net of refunds received, of $6.8 million in 2018 , $36.0 million in 2017 , and $30.2 million in 2016 . |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Shareholders' Equity | SHAREHOLDERS’ EQUITY The following table details activity in our common stock: Years Ended December 31, 2018 2017 2016 Shares Amount Shares Amount Shares Amount Stock option exercises 1,126 $ 74,907 1,113 $ 49,845 827 $ 23,527 Purchases of common stock (781 ) (150,050 ) (44 ) (6,613 ) (882 ) (112,699 ) Employee stock plan purchases 45 8,051 51 7,044 47 6,236 As of February 20, 2019 , we had authorization from our board of directors to repurchase up to 2.7 million additional shares of our common stock. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | SHARE-BASED COMPENSATION Share-Based Compensation Plan In May 2018, stockholders approved the Tyler Technologies, Inc. 2018 Stock Incentive Plan ("the 2018 Plan") which amended and restated the existing Tyler Technologies, Inc. 2010 Stock Option Plan ("the 2010 Plan"). Upon stockholder approval of the 2018 Plan, the remaining shares available for grant under the 2010 Plan were added to the shares authorized for grant under the 2018 Plan. Additionally, any awards previously granted under the 2010 Plan that expire unexercised or are forfeited are added to the shares authorized for grant under the 2018 Plan. During fiscal year 2018, we granted stock awards under the 2018 Plan in the form of stock options, restricted stock units and performance share units. Stock options generally vest after three to six years of continuous service from the date of grant and have a contractual term of 10 years. Once options become exercisable, the employee can purchase shares of our common stock at the market price on the date we granted the option. Restricted stock unit grants generally vest ratably over three to five years of continuous service from the date of grant. Each performance share unit represents the right to receive one share of our common stock based on our achievement of certain financial performance targets during applicable performance periods. We account for share-based compensation utilizing the fair value recognition pursuant to ASC 718, Stock Compensation . As of December 31, 2018 , there were 3.8 million shares available for future grants under the plan from the 22.9 million shares previously approved by the shareholders. Determining Fair Value of Stock Compensation Valuation and Amortization Method. We estimate the fair value of stock option awards granted using the Black-Scholes option valuation model. For restricted stock unit and performance stock unit awards, we amortize the fair value of all awards on a straight-line basis over the requisite service periods, which are generally the vesting periods. Expected Life. The expected life of awards granted represents the period of time that they are expected to be outstanding. The expected life represents the weighted-average period the stock options are expected to be outstanding based primarily on the options’ vesting terms, remaining contractual life and the employees’ expected exercise based on historical patterns. Expected Volatility. Using the Black-Scholes option valuation model, we estimate the volatility of our common stock at the date of grant based on the historical volatility of our common stock. Risk-Free Interest Rate. We base the risk-free interest rate used in the Black-Scholes option valuation model on the implied yield currently available on U.S. Treasury zero-coupon issues with an equivalent remaining term equal to the expected life of the award. Expected Dividend Yield. We have not paid any cash dividends on our common stock in more than ten years and we do not anticipate paying any cash dividends in the foreseeable future. Consequently, we use an expected dividend yield of zero in the Black-Scholes option valuation model. Expected Forfeitures. We use historical data to estimate pre-vesting option forfeitures. We record share-based compensation only for those awards that are expected to vest. The following weighted average assumptions were used for options granted: Years Ended December 31, 2018 2017 2016 Expected life (in years) 6.0 6.0 6.0 Expected volatility 26.7 % 28.1 % 29.3 % Risk-free interest rate 2.7 % 2.0 % 1.8 % Expected forfeiture rate — % — % — % Share-Based Award Activity The following table summarizes restricted stock unit and performance stock unit activity during fiscal year 2018 (shares in thousands): Number of Shares Weighted Average Grant Date Fair Value per Share Unvested at January 1, 2018 — $ — Granted 336 $ 221.29 Vested — $ — Forfeited (2 ) $ 229.75 Unvested at December 31, 2018 334 $ 221.25 Options granted, exercised, forfeited and expired are summarized as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at December 31, 2015 5,164 $ 64.43 Granted 846 147.25 Exercised (827 ) 28.43 Forfeited (27 ) 95.33 Outstanding at December 31, 2016 5,156 83.64 Granted 824 176.26 Exercised (1,113 ) 44.80 Forfeited (50 ) 134.83 Outstanding at December 31, 2017 4,817 107.91 Granted 432 208.21 Exercised (1,126 ) 66.53 Forfeited (31 ) 158.80 Outstanding at December 31, 2018 4,092 129.51 7 $ 240,069 Exercisable at December 31, 2018 2,357 100.41 6 $ 201,349 We had unvested options to purchase 1.7 million shares with a weighted average grant date exercise price of $169.24 as of December 31, 2018 , and unvested options to purchase 2.4 million shares with a weighted average grant date exercise price of $136.51 as of December 31, 2017 . Other information pertaining to option activity was as follows during the twelve months ended December 31: 2018 2017 2016 Weighted average grant-date fair value of stock options granted $ 66.52 $ 55.56 $ 46.89 Total intrinsic value of stock options exercised 176,716 137,699 103,703 Share-Based Compensation Expense\ The following table summarizes share-based compensation expense related to share-based awards which is recorded in the statements of comprehensive income: Years Ended December 31, 2018 2017 2016 Cost of software services, maintenance and subscriptions $ 13,588 $ 9,415 $ 6,548 Selling, general and administrative expenses 39,152 27,933 23,199 Total share-based compensation expenses 52,740 37,348 29,747 Tax benefit (32,487 ) (40,624 ) (30,059 ) Net decrease (increase) in net income $ 20,253 $ (3,276 ) $ (312 ) As of December 31, 2018 , we had $137.6 million of total unrecognized compensation cost related to unvested options and restricted stock units, net of expected forfeitures, which is expected to be amortized over a weighted average amortization period of 3 years. Employee Stock Purchase Plan Under our Employee Stock Purchase Plan (“ESPP”) participants may contribute up to 15% of their annual compensation to purchase common shares of Tyler. The purchase price of the shares is equal to 85% of the closing price of Tyler shares on the last day of each quarterly offering period. As of December 31, 2018 , there were 749,000 shares available for future grants under the ESPP from the 2.0 million shares previously approved by the stockholders. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE Basic earnings and diluted earnings per share data were computed as follows: Years Ended December 31, 2018 2017 2016 As Adjusted As adjusted Numerator for basic and diluted earnings per share: Net income $ 147,462 $ 169,571 $ 113,701 Denominator: Weighted-average basic common shares outstanding 38,445 37,273 36,448 Assumed conversion of dilutive securities: Stock options 1,678 1,973 2,513 Denominator for diluted earnings per share - Adjusted weighted-average shares 40,123 39,246 38,961 Earnings per common share: Basic $ 3.84 $ 4.55 $ 3.12 Diluted $ 3.68 $ 4.32 $ 2.92 Share-based awards representing the right to purchase common stock of 888,000 shares in 2018 , 1,343,000 shares in 2017 , and 786,000 shares in 2016 were not included in the computation of diluted earnings per share because their inclusion would have had an anti-dilutive effect. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2018 | |
Leases [Abstract] | |
Leases | LEASES We lease office facilities for use in our operations, as well as transportation and other equipment. Most of our leases are non-cancelable operating lease agreements and they expire at various dates through 2026 . In addition to rent, the leases generally require us to pay taxes, maintenance, insurance and certain other operating expenses. Rent expense was approximately $8.0 million in 2018 , $6.9 million in 2017 , and $6.7 million in 2016 , which included rent expense associated with related party lease agreements of $150,000 in 2017 , and $330,000 in 2016 . We had no related party lease agreements in 2018 . Future minimum lease payments under all non-cancelable leases at December 31, 2018 are as follows: Years Ending December 31, 2019 $ 5,994 2020 5,146 2021 3,976 2022 1,925 2023 1,164 Thereafter 2,132 Total $ 20,337 |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2018 | |
Postemployment Benefits [Abstract] | |
Employee Benefit Plans | EMPLOYEE BENEFIT PLANS We provide a defined contribution plan for the majority of our employees meeting minimum service requirements. Eligible employees can contribute up to 30% of their current compensation to the plan subject to certain statutory limitations. We contribute up to a maximum of 3% of an employee’s compensation to the plan. We made contributions to the plan and charged operating results $9.3 million in 2018 , $7.9 million in 2017 , and $6.9 million in 2016 . |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Other than routine litigation incidental to our business, there are no material legal proceedings pending to which we are party or to which any of our properties are subject. |
Segment and Related Information
Segment and Related Information | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment and Related Information | SEGMENT AND RELATED INFORMATION We provide integrated information management solutions and services for the public sector, with a focus on local governments. We provide our software systems and services and appraisal services through five business units, which focus on the following products: • financial management, education and planning, regulatory and maintenance software solutions; • financial management, municipal courts, planning, regulatory and maintenance, and land and vital records management software solutions; • courts and justice and public safety software solutions; • data and insights solutions; and • appraisal and tax software solutions and property appraisal services. In accordance with ASC 280-10, Segment Reporting , the financial management, education and planning, regulatory and maintenance software solutions unit; financial management, municipal courts and land and vital records management software solutions unit; and the courts and justice and public safety software solutions unit meet the criteria for aggregation and are presented in one reportable segment, Enterprise Software (“ES”). The ES segment provides municipal and county governments and schools with software systems and services to meet their information technology and automation needs for mission-critical “back-office” functions such as financial management and courts and justice and public safety processes. The Appraisal and Tax (“A&T”) segment provides systems and software that automate the appraisal and assessment of real and personal property as well as property appraisal outsourcing services for local governments and taxing authorities. Property appraisal outsourcing services include: the physical inspection of commercial and residential properties; data collection and processing; computer analysis for property valuation; preparation of tax rolls; community education; and arbitration between taxpayers and the assessing jurisdiction. We evaluate performance based on several factors, of which the primary financial measure is business segment operating income. We define segment operating income for our business units as income before noncash amortization of intangible assets associated with their acquisition, interest expense and income taxes. Segment operating income includes intercompany transactions. The majority of intercompany transactions relate to contracts involving more than one unit and are valued based on the contractual arrangement. Segment operating income for corporate primarily consists of compensation costs for the executive management team and certain accounting and administrative staff and share-based compensation expense for the entire company. Corporate segment operating income also includes revenues and expenses related to a company-wide user conference. The accounting policies of the reportable segments are the same as those described in Note 1, “Summary of Significant Accounting Policies.” Segment assets include net accounts receivable, prepaid expenses and other current assets and net property and equipment. Corporate assets consist of cash and investments, prepaid insurance, intangibles associated with acquisitions, deferred income taxes and net property and equipment mainly related to unallocated information and technology assets. ES segment capital expenditures included $2.2 million in 2018 and $24.4 million in 2017 for the expansion of existing buildings and purchases of buildings and land. For the year ended December 31, 2018 Enterprise Software Appraisal and Tax Corporate Totals Revenues Software licenses and royalties $ 83,735 $ 9,706 $ — $ 93,441 Subscriptions 210,740 9,807 — 220,547 Software services 166,921 24,348 — 191,269 Maintenance 359,904 24,617 — 384,521 Appraisal services — 21,846 — 21,846 Hardware and other 18,745 32 4,881 23,658 Intercompany 13,155 — (13,155 ) — Total revenues $ 853,200 $ 90,356 $ (8,274 ) $ 935,282 Depreciation and amortization expense 50,130 914 10,715 61,759 Segment operating income 237,159 23,094 (68,572 ) 191,681 Capital expenditures 13,973 782 10,377 25,132 Segment assets $ 556,100 $ 63,670 $ 1,171,193 $ 1,790,963 For the year ended December 31, 2017 (As Adjusted) Enterprise Software Appraisal and Tax Corporate Totals Revenues Software licenses and royalties $ 78,388 $ 7,854 $ — $ 86,242 Subscriptions 164,317 7,859 — 172,176 Software services 161,245 19,215 — 180,460 Maintenance 337,701 21,618 — 359,319 Appraisal services — 25,023 — 25,023 Hardware and other 13,057 10 4,612 17,679 Intercompany 10,425 — (10,425 ) — Total revenues $ 765,133 $ 81,579 $ (5,813 ) $ 840,899 Depreciation and amortization expense 43,987 760 8,648 53,395 Segment operating income 229,001 20,788 (51,964 ) 197,825 Capital expenditures 28,096 1,181 16,341 45,618 Segment assets $ 365,736 $ 46,279 $ 1,199,336 $ 1,611,351 For the year ended December 31, 2016 (As Adjusted) Enterprise Software Appraisal and Tax Corporate Totals Revenues Software licenses and royalties $ 78,271 $ 5,462 $ — $ 83,733 Subscriptions 135,469 7,188 — 142,657 Software services 155,322 16,326 — 171,648 Maintenance 302,409 18,589 — 320,998 Appraisal services — 26,287 — 26,287 Hardware and other 11,526 16 3,015 14,557 Intercompany 6,742 — (6,742 ) — Total revenues $ 689,739 $ 73,868 $ (3,727 ) $ 759,880 Depreciation and amortization expense 43,434 984 5,355 49,773 Segment operating income 196,054 18,871 (41,832 ) 173,093 Capital expenditures 23,843 1,432 11,448 36,723 Segment assets $ 321,886 $ 33,005 $ 1,023,612 $ 1,378,503 Reconciliation of reportable segment operating Years Ended December 31, income to the Company's consolidated totals: 2018 2017 2016 As Adjusted As Adjusted Total segment operating income $ 191,681 $ 197,825 $ 173,093 Amortization of acquired software (22,972 ) (21,686 ) (22,235 ) Amortization of customer and trade name intangibles (16,217 ) (13,381 ) (13,202 ) Other income (expense), net 3,378 698 (1,998 ) Income before income taxes $ 155,870 $ 163,456 $ 135,658 |
Disaggregation of Revenue
Disaggregation of Revenue | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue, Deferred Revenue and Performance Obligations, and Deferred Commissions | Disaggregation of Revenue The tables below show disaggregation of revenue into categories that reflect how economic factors affect the nature, amount, timing, and uncertainty of revenue and cash flows. Timing of Revenue Recognition Timing of revenue recognition by revenue category during the period is as follows: For the year ended December 31, 2018 Products and services transferred at a point in time Products and services transferred over time Total Revenues Software licenses and royalties $ 75,188 $ 18,253 $ 93,441 Subscriptions — 220,547 220,547 Software services — 191,269 191,269 Maintenance — 384,521 384,521 Appraisal services — 21,846 21,846 Hardware and other 23,658 — 23,658 Total $ 98,846 $ 836,436 $ 935,282 For the year ended December 31, 2017 (As Adjusted) Products and services transferred at a point in time Products and services transferred over time Total Revenues Software licenses and royalties $ 69,167 $ 17,075 $ 86,242 Subscriptions — 172,176 172,176 Software services — 180,460 180,460 Maintenance — 359,319 359,319 Appraisal services — 25,023 25,023 Hardware and other 17,679 — 17,679 Total $ 86,846 $ 754,053 $ 840,899 Recurring Revenue The majority of our revenue is comprised of recurring revenues from maintenance and subscriptions. Virtually all of our on-premises software clients contract with us for maintenance and support, which provides us with a significant source of recurring revenue. We generally provide maintenance and support for our on-premises clients under annual, or in some cases, multi-year contracts. The contract terms for subscription arrangements range from one to 10 years but are typically contracted for initial periods of three to five years, providing a significant source of recurring revenues on an annual basis. Non-recurring revenues are derived for all other revenue categories. Recurring revenues and non-recurring revenues recognized during the period are as follows: For the year ended December 31, 2018 Enterprise Software Appraisal and Tax Corporate Totals Recurring revenues $ 570,645 $ 34,424 $ — $ 605,069 Non-recurring revenues 269,400 55,932 4,881 330,213 Intercompany 13,155 — (13,155 ) — Total revenues $ 853,200 $ 90,356 $ (8,274 ) $ 935,282 For the year ended December 31, 2017 (As Adjusted) Enterprise Software Appraisal and Tax Corporate Totals Recurring revenues $ 502,018 $ 29,477 $ — $ 531,495 Non-recurring revenues 252,690 52,102 4,612 309,404 Intercompany 10,425 — (10,425 ) — Total revenues $ 765,133 $ 81,579 $ (5,813 ) $ 840,899 Deferred Revenue and Performance Obligations Total deferred revenue, including long-term, by segment is as follows: December 31, 2018 December 31, 2017 As Adjusted Enterprise Software $ 327,521 $ 277,198 Appraisal and Tax 20,018 20,387 Corporate 3,397 2,302 Totals $ 350,936 $ 299,887 The opening balance of total deferred revenue, including long-term, was $290.1 million (as adjusted) as of January 1, 2017. Changes in total deferred revenue, including long-term, were as follows: 2018 Balance at beginning of year (As Adjusted) $ 299,887 Deferral of revenue 871,498 Recognition of deferred revenue (820,449 ) Balance at end of year $ 350,936 Transaction Price Allocated to the Remaining Performance Obligations The aggregate amount of transaction price allocated to the remaining performance obligations represents contracted revenue that has not yet been recognized ("Backlog"), which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. Backlog as of December 31, 2018 was $1.25 billion , of which we expect to recognize approximately 50% as revenue over the next 12 months and the remainder thereafter. Deferred Commissions Sales commissions earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions for initial contracts are deferred and then amortized commensurate with the recognition of associated revenue over a period of benefit that we have determined to be three to seven years. Deferred commissions were $21.9 million and $19.3 million (as adjusted) as of December 31, 2018, and December 31, 2017, respectively. Amortization expense was $15.6 million for the twelve months ended December 31, 2018 and $11.2 million (as adjusted) for the twelve months ended December 31, 2017, respectively. There were no indicators of impairment in relation to the costs capitalized for the periods presented. Deferred commissions have been included with prepaid expenses in the accompanying consolidated balance sheets. Amortization expense related to deferred commissions is included in selling, general and administrative expenses in the accompanying consolidated statements of income. |
Deferred Revenue and Performanc
Deferred Revenue and Performance Obligations | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue, Deferred Revenue and Performance Obligations, and Deferred Commissions | Disaggregation of Revenue The tables below show disaggregation of revenue into categories that reflect how economic factors affect the nature, amount, timing, and uncertainty of revenue and cash flows. Timing of Revenue Recognition Timing of revenue recognition by revenue category during the period is as follows: For the year ended December 31, 2018 Products and services transferred at a point in time Products and services transferred over time Total Revenues Software licenses and royalties $ 75,188 $ 18,253 $ 93,441 Subscriptions — 220,547 220,547 Software services — 191,269 191,269 Maintenance — 384,521 384,521 Appraisal services — 21,846 21,846 Hardware and other 23,658 — 23,658 Total $ 98,846 $ 836,436 $ 935,282 For the year ended December 31, 2017 (As Adjusted) Products and services transferred at a point in time Products and services transferred over time Total Revenues Software licenses and royalties $ 69,167 $ 17,075 $ 86,242 Subscriptions — 172,176 172,176 Software services — 180,460 180,460 Maintenance — 359,319 359,319 Appraisal services — 25,023 25,023 Hardware and other 17,679 — 17,679 Total $ 86,846 $ 754,053 $ 840,899 Recurring Revenue The majority of our revenue is comprised of recurring revenues from maintenance and subscriptions. Virtually all of our on-premises software clients contract with us for maintenance and support, which provides us with a significant source of recurring revenue. We generally provide maintenance and support for our on-premises clients under annual, or in some cases, multi-year contracts. The contract terms for subscription arrangements range from one to 10 years but are typically contracted for initial periods of three to five years, providing a significant source of recurring revenues on an annual basis. Non-recurring revenues are derived for all other revenue categories. Recurring revenues and non-recurring revenues recognized during the period are as follows: For the year ended December 31, 2018 Enterprise Software Appraisal and Tax Corporate Totals Recurring revenues $ 570,645 $ 34,424 $ — $ 605,069 Non-recurring revenues 269,400 55,932 4,881 330,213 Intercompany 13,155 — (13,155 ) — Total revenues $ 853,200 $ 90,356 $ (8,274 ) $ 935,282 For the year ended December 31, 2017 (As Adjusted) Enterprise Software Appraisal and Tax Corporate Totals Recurring revenues $ 502,018 $ 29,477 $ — $ 531,495 Non-recurring revenues 252,690 52,102 4,612 309,404 Intercompany 10,425 — (10,425 ) — Total revenues $ 765,133 $ 81,579 $ (5,813 ) $ 840,899 Deferred Revenue and Performance Obligations Total deferred revenue, including long-term, by segment is as follows: December 31, 2018 December 31, 2017 As Adjusted Enterprise Software $ 327,521 $ 277,198 Appraisal and Tax 20,018 20,387 Corporate 3,397 2,302 Totals $ 350,936 $ 299,887 The opening balance of total deferred revenue, including long-term, was $290.1 million (as adjusted) as of January 1, 2017. Changes in total deferred revenue, including long-term, were as follows: 2018 Balance at beginning of year (As Adjusted) $ 299,887 Deferral of revenue 871,498 Recognition of deferred revenue (820,449 ) Balance at end of year $ 350,936 Transaction Price Allocated to the Remaining Performance Obligations The aggregate amount of transaction price allocated to the remaining performance obligations represents contracted revenue that has not yet been recognized ("Backlog"), which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. Backlog as of December 31, 2018 was $1.25 billion , of which we expect to recognize approximately 50% as revenue over the next 12 months and the remainder thereafter. Deferred Commissions Sales commissions earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions for initial contracts are deferred and then amortized commensurate with the recognition of associated revenue over a period of benefit that we have determined to be three to seven years. Deferred commissions were $21.9 million and $19.3 million (as adjusted) as of December 31, 2018, and December 31, 2017, respectively. Amortization expense was $15.6 million for the twelve months ended December 31, 2018 and $11.2 million (as adjusted) for the twelve months ended December 31, 2017, respectively. There were no indicators of impairment in relation to the costs capitalized for the periods presented. Deferred commissions have been included with prepaid expenses in the accompanying consolidated balance sheets. Amortization expense related to deferred commissions is included in selling, general and administrative expenses in the accompanying consolidated statements of income. |
Deferred Commissions
Deferred Commissions | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue, Deferred Revenue and Performance Obligations, and Deferred Commissions | Disaggregation of Revenue The tables below show disaggregation of revenue into categories that reflect how economic factors affect the nature, amount, timing, and uncertainty of revenue and cash flows. Timing of Revenue Recognition Timing of revenue recognition by revenue category during the period is as follows: For the year ended December 31, 2018 Products and services transferred at a point in time Products and services transferred over time Total Revenues Software licenses and royalties $ 75,188 $ 18,253 $ 93,441 Subscriptions — 220,547 220,547 Software services — 191,269 191,269 Maintenance — 384,521 384,521 Appraisal services — 21,846 21,846 Hardware and other 23,658 — 23,658 Total $ 98,846 $ 836,436 $ 935,282 For the year ended December 31, 2017 (As Adjusted) Products and services transferred at a point in time Products and services transferred over time Total Revenues Software licenses and royalties $ 69,167 $ 17,075 $ 86,242 Subscriptions — 172,176 172,176 Software services — 180,460 180,460 Maintenance — 359,319 359,319 Appraisal services — 25,023 25,023 Hardware and other 17,679 — 17,679 Total $ 86,846 $ 754,053 $ 840,899 Recurring Revenue The majority of our revenue is comprised of recurring revenues from maintenance and subscriptions. Virtually all of our on-premises software clients contract with us for maintenance and support, which provides us with a significant source of recurring revenue. We generally provide maintenance and support for our on-premises clients under annual, or in some cases, multi-year contracts. The contract terms for subscription arrangements range from one to 10 years but are typically contracted for initial periods of three to five years, providing a significant source of recurring revenues on an annual basis. Non-recurring revenues are derived for all other revenue categories. Recurring revenues and non-recurring revenues recognized during the period are as follows: For the year ended December 31, 2018 Enterprise Software Appraisal and Tax Corporate Totals Recurring revenues $ 570,645 $ 34,424 $ — $ 605,069 Non-recurring revenues 269,400 55,932 4,881 330,213 Intercompany 13,155 — (13,155 ) — Total revenues $ 853,200 $ 90,356 $ (8,274 ) $ 935,282 For the year ended December 31, 2017 (As Adjusted) Enterprise Software Appraisal and Tax Corporate Totals Recurring revenues $ 502,018 $ 29,477 $ — $ 531,495 Non-recurring revenues 252,690 52,102 4,612 309,404 Intercompany 10,425 — (10,425 ) — Total revenues $ 765,133 $ 81,579 $ (5,813 ) $ 840,899 Deferred Revenue and Performance Obligations Total deferred revenue, including long-term, by segment is as follows: December 31, 2018 December 31, 2017 As Adjusted Enterprise Software $ 327,521 $ 277,198 Appraisal and Tax 20,018 20,387 Corporate 3,397 2,302 Totals $ 350,936 $ 299,887 The opening balance of total deferred revenue, including long-term, was $290.1 million (as adjusted) as of January 1, 2017. Changes in total deferred revenue, including long-term, were as follows: 2018 Balance at beginning of year (As Adjusted) $ 299,887 Deferral of revenue 871,498 Recognition of deferred revenue (820,449 ) Balance at end of year $ 350,936 Transaction Price Allocated to the Remaining Performance Obligations The aggregate amount of transaction price allocated to the remaining performance obligations represents contracted revenue that has not yet been recognized ("Backlog"), which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. Backlog as of December 31, 2018 was $1.25 billion , of which we expect to recognize approximately 50% as revenue over the next 12 months and the remainder thereafter. Deferred Commissions Sales commissions earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions for initial contracts are deferred and then amortized commensurate with the recognition of associated revenue over a period of benefit that we have determined to be three to seven years. Deferred commissions were $21.9 million and $19.3 million (as adjusted) as of December 31, 2018, and December 31, 2017, respectively. Amortization expense was $15.6 million for the twelve months ended December 31, 2018 and $11.2 million (as adjusted) for the twelve months ended December 31, 2017, respectively. There were no indicators of impairment in relation to the costs capitalized for the periods presented. Deferred commissions have been included with prepaid expenses in the accompanying consolidated balance sheets. Amortization expense related to deferred commissions is included in selling, general and administrative expenses in the accompanying consolidated statements of income. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events The following events and transactions occurred subsequent to December 31, 2018 : On January 31, 2019, (i) Tyler Technologies, Inc., a Delaware corporation (“Parent”), (ii) TMP Subsidiary, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”), (iii) MP Holdings Parent, Inc., dba MicroPact, a Delaware corporation (“Micropact”), and (iv) Arlington Capital Partners II, L.P., a Delaware limited partnership (“Representative”), signed an Agreement and Plan of Merger (the “Merger Agreement”). The Merger Agreement provides for the merger of Merger Sub with and into MicroPact on the terms and subject to the conditions set forth in the Merger Agreement, with MicroPact as the surviving company and a wholly owned, direct subsidiary of Parent. Pursuant to the Merger Agreement, Parent will pay MicroPact’s shareholders aggregate merger consideration of approximately $185.0 million in cash, which shall include an amount equal to MicroPact’s closing date working capital and be subject to a post-closing working capital adjustment as described in the Merger Agreement and an additional merger consideration of up to $10.0 million based on certain fiscal 2019 EBITDA thresholds. The merger consideration will be funded from cash on hand and proceeds from the revolving credit facility. The Merger and the Merger Agreement have been approved by the boards of directors of both MicroPact, Parent and Merger Sub. The Merger Agreement contains customary representations, warranties, and covenants of MicroPact, Parent and Merger Sub. The covenants include, among others, an obligation on behalf of MicroPact to operate its business in the ordinary course until the Merger is consummated, and limitations on the right of MicroPact to solicit or engage in negotiations regarding alternative acquisition proposals during the pre-Closing period. The completion of the Merger is subject to customary closing conditions, including the expiration or the termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act. The Federal Trade Commission granted early termination of that waiting period effective February 15, 2019. Customary closing conditions also include each party’s satisfaction of the applicable representations and warranties, and compliance in all material respects with its applicable covenants. Consummation of the Merger is not subject to a financing condition. The Merger Agreement may be terminated prior to closing under certain enumerated circumstances, including if the Merger is not consummated by May 1, 2019. Termination rights are held by Parent, MicroPact, and Representative, depending on the circumstances giving rise to the termination. The foregoing description of the Merger Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement, a copy of which is attached hereto as Exhibit 10.7 and incorporated herein by reference. MicroPact is a leading provider of commercial off-the-shelf (COTS) solutions, including entellitrak®, a low-code application development platform for case management and business process management used extensively in the public sector. On February 1, 2019, we acquired all the assets of Civic, LLC ("MyCivic"), a company that provides software solutions to connect communities. The purchase price is $ 3.7 million of which $3.6 million was paid in cash and approximately $90,000 was accrued for a working capital holdback. |
Quarterly Financial Information
Quarterly Financial Information (unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information (unaudited) | QUARTERLY FINANCIAL INFORMATION (unaudited) The following table contains selected financial information from unaudited statements of income for each quarter of 2018 and 2017 : Quarters Ended 2018 2017 (As Adjusted) Dec. 31 Sept. 30 June 30 Mar. 31 Dec. 31(a) Sept. 30 June 30 Mar. 31 Revenues $ 241,981 $ 236,067 $ 236,060 $ 221,174 $ 217,701 $ 214,706 $ 208,763 $ 199,729 Gross profit 115,871 111,626 109,276 102,805 105,350 103,989 95,503 94,535 Income before income taxes 40,107 38,626 37,700 39,437 45,261 44,357 37,197 36,641 Net income 31,552 38,924 39,161 37,825 66,196 38,836 31,770 32,769 Earnings per diluted share $ 0.79 $ 0.96 $ 0.97 $ 0.95 $ 1.68 $ 0.99 $ 0.81 $ 0.84 Shares used in computing diluted earnings per share 39,891 40,528 40,224 39,836 39,499 39,342 39,201 38,932 (a) The fourth quarter of 2017 includes the significant impact of the enactment of the Tax Act. The most significant impact of the Tax Act to us is the reduction in the U.S. federal corporate income tax rate from 35% to 21%. The impact of the rate reduction on our 2017 income tax provision is a $26.0 million tax benefit due to the remeasurement of deferred tax assets and liabilities. Refer to Note 7 - "Income Tax" for further discussion on the impact the Tax Act. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | PRINCIPLES OF CONSOLIDATION The consolidated financial statements include our parent company and two subsidiaries, which are wholly-owned. All significant intercompany balances and transactions have been eliminated in consolidation. Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions, and other events and circumstances from non-owner sources and includes all components of net income (loss) and other comprehensive income (loss). We had no items of other comprehensive income (loss) during the years ended December 31, 2018 , 2017 and 2016 . |
Cash and Cash Equivalents | CASH AND CASH EQUIVALENTS Cash in excess of that necessary for operating requirements is invested in short-term, highly liquid, income-producing investments. Investments with original maturities of three months or less are classified as cash and cash equivalents, which primarily consist of cash on deposit with several banks and money market funds. Cash and cash equivalents are stated at cost, which approximates market value. |
Revenue Recognition | REVENUE RECOGNITION Nature of Products and Services We earn revenue from software licenses, royalties, subscription-based services, software services, post-contract customer support (“PCS” or “maintenance”), hardware, and appraisal services. Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. We determine revenue recognition through the following steps: • Identification of the contract, or contracts, with a customer • Identification of the performance obligations in the contract • Determination of the transaction price • Allocation of the transaction price to the performance obligations in the contract • Recognition of revenue when, or as, we satisfy a performance obligation Most of our software arrangements with customers contain multiple performance obligations that range from software licenses, installation, training, and consulting to software modification and customization to meet specific customer needs (services), hosting, and PCS. For these contracts, we account for individual performance obligations separately when they are distinct. We evaluate whether separate performance obligations can be distinct or should be accounted for as one performance obligation. Arrangements that include software services, such as training or installation, are evaluated to determine whether those services are highly interdependent or interrelated to the product’s functionality. The transaction price is allocated to the distinct performance obligations on a relative standalone selling price (“SSP”) basis. We determine the SSP based on our overall pricing objectives, taking into consideration market conditions and other factors, including the value of our contracts, the applications sold, customer demographics, and the number and types of users within our contracts. Revenue is recognized net of allowances for sales adjustments and any taxes collected from customers, which are subsequently remitted to governmental authorities. Software Arrangements: Software Licenses and Royalties Many of our software arrangements involve “off-the-shelf” software. We recognize the revenue allocable to "off-the-shelf" software licenses and specified upgrades at a point in time when control of the software license transfers to the customer, unless the software is not considered distinct. We consider off-the-shelf software to be distinct when it can be added to an arrangement with minor changes in the underlying code, it can be used by the customer for the customer’s purpose upon installation, and remaining services such as training are not considered highly interdependent or interrelated to the product's functionality. For arrangements that involve significant production, modification or customization of the software, or where software services are otherwise not considered distinct, we recognize revenue over time by measuring progress-to-completion. We measure progress-to-completion primarily using labor hours incurred as it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. These arrangements are often implemented over an extended period and occasionally require us to revise total cost estimates. Amounts recognized in revenue are calculated using the progress-to-completion measurement after giving effect to any changes in our cost estimates. Changes to total estimated contract costs, if any, are recorded in the period they are determined. Estimated losses on uncompleted contracts are recorded in the period in which we first determine that a loss is apparent. Software license fees are billed in accordance with the contract terms. Typically, a majority of the fee is due when access to the software license is made available to the customer and the remainder of the fee due over a passage of time stipulated by the contract. We record amounts that have been invoiced in accounts receivable and in deferred revenue or revenues, depending on whether the revenue recognition criteria have been met. We recognize royalty revenue when the sale occurs under the terms of our third-party royalty arrangements. Currently, our third-party royalties are recognized on an estimated basis and are trued up when we receive notice of amounts we are entitled to receive. We typically receive notice of royalty revenues we are entitled to and billed on a quarterly basis in the quarter immediately following the royalty reporting period. Software Services As noted above, some of our software arrangements include services considered highly interdependent or highly interrelated or require significant customization to meet the customer's desired functionality. For these software arrangements, both the software licenses and related software services revenue are not distinct and are recognized over time using the progress-to-completion method. We measure progress-to-completion primarily using labor hours incurred as it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. Contract fees are typically billed on a milestone basis as defined within contract terms. We record amounts that have been invoiced in accounts receivable and in deferred revenue or revenues, depending on whether the revenue recognition criteria have been met. When software services are distinct, the fee allocable to the service element is recognized over the time we perform the services and is billed on a time and material basis. Post-Contract Customer Support Our customers generally enter into PCS agreements when they purchase our software licenses. PCS includes telephone support, bug fixes, and rights to upgrades on a when-and-if available basis. PCS is considered distinct when purchased with our software licenses. Our PCS agreements are typically renewable annually. PCS is recognized over time on a straight-line basis over the period the PCS is provided. All significant costs and expenses associated with PCS are expensed as incurred. Computer Hardware Equipment Revenue allocable to computer hardware equipment is recognized at a point in time when control of the equipment is transferred to the customer. Subscription-Based Services: Subscription-based services consist of revenues derived from SaaS arrangements, which primarily utilize the Tyler private cloud, and electronic filing transactions. Revenue from subscription-based services is generally recognized over time on a ratable basis over the contract term, beginning on the date that our service is made available to the customer. Our subscription contracts are generally three to five years or longer in length, billed annually in advance, and non-cancelable. For SaaS arrangements, we evaluate whether the customer has the contractual right to take possession of our software at any time during the hosting period without significant penalty and whether the customer can feasibly maintain the software on the customer’s hardware or enter into another arrangement with a third-party to host the software. We allocate contract value to each performance obligation of the arrangement that qualifies for treatment as a distinct element based on estimated SSP. When it is determined that software is distinct, and the customer has the ability to take control of the software, we recognize revenue allocable to the software license fee when access to the software license is made available to the customer. We recognize hosting services ratably over the term of the arrangement, which range from one to ten years but are typically for a period of three to five years. For software services associated with certain SaaS arrangements, we have concluded that the services are not distinct, and we recognize the revenue ratably over the remaining contractual period once we have provided the customer access to the software. We record amounts that have been invoiced in accounts receivable and in deferred revenue or revenues, depending on whether the revenue recognition criteria have been met. Electronic filing transaction fees primarily pertain to documents filed with the courts by attorneys and other third-parties via our e-filing services and retrieval of filed documents via our access services. For each document filed with a court, the filer generally pays a transaction fee and a court filing fee to us and we remit a portion of the transaction fee and the filing fee to the court. We record as revenue the transaction fee, while the portion of the transaction fee remitted to the courts is recorded as cost of sales as we are acting as a principal in the arrangement. Court filing fees collected on behalf of the courts and remitted to the courts are recorded on a net basis and thus do not affect the statement of comprehensive income. For e-filing transaction fees, we have the right to charge the customer an amount that directly corresponds with the value to the customer of our performance to date. Therefore, we recognize revenue for these services over time based on the amount billable to the customer in accordance with the 'as invoiced' practical expedient in ASC 606-10-55-18. In some cases, we are paid on a fixed fee basis and recognize the revenue ratably over the contractual period. Costs of performing services under subscription-based arrangements are expensed as incurred, except for certain direct and incremental contract origination and set-up costs associated with SaaS arrangements. Such direct and incremental costs are capitalized and amortized ratably over the useful life. Appraisal Services: For our property appraisal projects, we recognize revenue using the progress-to-completion method since many of these projects are implemented over one to three -year periods and consist of various unique activities. Appraisal services require a significant level of integration and interdependency with various individual service components; therefore, the service components are not considered distinct. Appraisal services are recognized over time by measuring progress-to-completion primarily using labor hours incurred as it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. These arrangements are often implemented over an extended period and occasionally require us to revise total cost estimates. Amounts recognized in revenue are calculated using the progress-to-completion measurement after giving effect to any changes in our cost estimates. Changes to total estimated contract costs, if any, are recorded in the period they are determined. Estimated losses on uncompleted contracts are recorded in the period in which we first determine that a loss is apparent. Contract fees are typically billed on a milestone basis as defined within contract terms. We record amounts that have been invoiced in accounts receivable and in deferred revenue or revenues, depending on whether the revenue recognition criteria have been met. Significant Judgments: Our contracts with customers often include multiple performance obligations to a customer. When a software arrangement (license or subscription) includes both software licenses and software services, judgment is required to determine whether the software license is considered distinct and accounted for separately, or not distinct and accounted for together with the software services and recognized over time. The transaction price is allocated to the separate performance obligations on a relative SSP basis. We determine the SSP based on our overall pricing objectives, taking into consideration market conditions and other factors, including the value of our contracts, the applications sold, customer demographics, and the number and types of users within our contracts. We use a range of amounts to estimate SSP when we sell each of the products and services separately and need to determine whether there is a discount to be allocated based on the relative SSP of the various products and services. In instances where SSP is not directly observable, such as when we do not sell the product or service separately, we determine SSP using the expected cost-plus margin approach. For arrangements that involve significant production, modification or customization of the software, or where software services otherwise cannot be considered distinct, we recognize revenue as control is transferred to the customer over time using progress-to-completion methods. Depending on the contract, we measure progress-to-completion primarily using labor hours incurred, or value added. The progress-to-completion method generally results in the recognition of reasonably consistent profit margins over the life of a contract because we can provide reasonably dependable estimates of contract billings and contract costs. We use the level of profit margin that is most likely to occur on a contract. If the most likely profit margin cannot be precisely determined, the lowest probable level of profit margin in the range of estimates is used until the results can be estimated more precisely. These arrangements are often implemented over an extended time period and occasionally require us to revise total cost estimates. Amounts recognized in revenue are calculated using the progress-to-completion measurement after giving effect to any changes in our cost estimates. Changes to total estimated contract costs, if any, are recorded in the period they are determined. Estimated losses on uncompleted contracts are recorded in the period in which we first determine that a loss is apparent. Typically, the structure of our arrangements does not give rise to variable consideration. However, in those instances whereby variable consideration exists, we include in our estimates additional revenue for variable consideration when we believe we have an enforceable right, the amount can be estimated reliably and its realization is probable. Refer to Note 15 - Disaggregation of Revenue for further information, including the economic factors that affect the nature, amount, timing, and uncertainty of revenue and cash flows of our various revenue categories. Contract Balances: Accounts receivable and allowance for doubtful accounts Timing of revenue recognition may differ from the timing of invoicing to customers. We record an unbilled receivable when revenue is recognized prior to invoicing, or deferred revenue when revenue is recognized subsequent to invoicing. For multi-year agreements, we generally invoice customers annually at the beginning of each annual coverage period. We record an unbilled receivable related to revenue recognized for on-premises licenses as we have an unconditional right to invoice and receive payment in the future related to those licenses. We maintain allowances for doubtful accounts, which are provided at the time the revenue is recognized. Since most of our customers are domestic governmental entities, we rarely incur a loss resulting from the inability of a customer to make required payments. Events or changes in circumstances that indicate the carrying amount for the allowances for doubtful accounts may require revision include, but are not limited to, deterioration of a customer’s financial condition, failure to manage our customer’s expectations regarding the scope of the services to be delivered, and defects or errors in new versions or enhancements of our software products. The following table summarizes the changes in the allowances for doubtful accounts and sales adjustments: Years Ended December 31, 2018 2017 2016 Balance at beginning of year $ 5,427 $ 3,396 $ 1,640 Provisions for losses - accounts receivable 2,286 4,110 4,484 Collection of accounts previously written off — — — Deductions for accounts charged off or credits issued (3,066 ) (2,079 ) (2,728 ) Balance at end of year $ 4,647 $ 5,427 $ 3,396 The allowance for doubtful accounts reflects our best estimate of probable losses inherent in the accounts receivable balance. We determine the allowance based on known troubled accounts, historical experience, and other currently available evidence. In connection with our appraisal services contracts and certain software services contracts, we may perform work prior to when the software and services are billable and/or payable pursuant to the contract. Unbilled revenue is not billable at the balance sheet date but is recoverable over the remaining life of the contract through billings made in accordance with contractual agreements. The termination clauses in most of our contracts provide for the payment for the value of products delivered or services performed in the event of early termination. We have historically recorded such unbilled receivables (costs and estimated profit in excess of billings) in connection with (1) property appraisal services contracts accounted for using progress-to-completion method of revenue recognition using labor hours as a measure of progress towards completion in which the services are performed in one accounting period but the billing normally occurs subsequently and may span another accounting period; (2) software services contracts accounted for using progress-to-completion method of revenue recognition using labor hours as a measure of progress towards completion in which the services are performed in one accounting period but the billing for the software element of the arrangement may be based upon the specific phase of the implementation; (3) software revenue for which we have recognized revenue at the point in time when the software is made available to the customer but the billing has not yet been submitted to the customer; (4) some of our contracts which provide for an amount to be withheld from a progress billing (generally between 5% and 20% retention) until final and satisfactory project completion is achieved; and (5) in a limited number of cases, extended payment terms, which may be granted to customers with whom we generally have a long-term relationship and favorable collection history. The opening balance of current and long-term accounts receivable, net of allowance for doubtful accounts, was $226.8 million (as adjusted) as of January 1, 2017. As of December 31, 2018 , and December 31, 2017 , total current and long-term accounts receivable, net of allowance for doubtful accounts, was $314.9 million and $258.3 million (as adjusted), respectively. We have recorded unbilled receivables of $104.2 million and $64.6 million (as adjusted) at December 31, 2018 , and December 31, 2017 , respectively. Included in unbilled receivables are retention receivables of $12.2 million and $7.2 million at December 31, 2018 , and December 31, 2017 , respectively, which become payable upon the completion of the contract or completion of our fieldwork and formal hearings. Unbilled receivables expected to be collected within one year have been included with accounts receivable, current portion in the accompanying consolidated balance sheets. Unbilled receivables and retention receivables expected to be collected past one year have been included with accounts receivable, long-term portion in the accompanying consolidated balance sheets. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 to 60 days. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined our contracts generally do not include a significant financing component. The primary purpose of our invoicing terms is to provide customers with simplified and predictable ways of purchasing our products and services, not to receive financing from our customers or to provide customers with financing. Examples include invoicing at the beginning of a subscription term with revenue recognized ratably over the contract period, and multi-year on-premises term licenses that are invoiced annually with revenue recognized upfront. Deferred Revenue The majority of deferred revenue consists of deferred maintenance revenue that has been billed based on contractual terms in the underlying arrangement, with the remaining balance consisting of payments received in advance of revenue being earned under software licensing, subscription-based services, software and appraisal services and hardware installation. Refer to Note 16 - Deferred Revenue and Performance Obligations for further information, including deferred revenue by segment and changes in deferred revenue during the period. Deferred Commissions Sales commissions earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions for initial contracts are deferred and then amortized on a straight-line basis over a period of benefit that we have determined to be three to seven years. We utilized the 'portfolio approach' practical expedient in ASC 606-10-10-4, which allows entities to apply the guidance to a portfolio of contracts with similar characteristics because the effects on the financial statements of this approach would not differ materially from applying the guidance to individual contracts. Using the 'portfolio approach', we determined the period of benefit by taking into consideration our customer contracts, our technology life-cycle and other factors. Sales commissions for renewal contracts are generally not paid in connection with the renewal of a contract. In the small number of instances where a commission is paid on a renewal, it is not commensurate with the commission paid on the initial sale and is recognized over the term of renewal, which is generally one year. Amortization expense related to deferred commissions is included in selling, general and administrative expenses in the accompanying consolidated statements of income. Refer to Note 17 - Deferred Commissions for further information. Prepaid expenses and other current assets include direct and incremental costs such as commissions associated with arrangements for which revenue recognition has been deferred. Such costs are expensed at the time the related revenue is recognized. |
Use of Estimates | USE OF ESTIMATES The preparation of our financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include revenue recognition, determining the nature and timing of satisfaction of performance obligations, and determining the SSP of performance obligations, variable consideration, and other obligations such as returns and refunds; loss contingencies; the estimated useful life of deferred commissions; the carrying amount and estimated useful lives of intangible assets; determining share-based compensation expense; the valuation allowance for receivables; and determining the potential outcome of future tax consequences of events that have been recognized on our consolidated financial statements or tax returns. Actual results could differ from estimates. |
Property and Equipment, Net | PROPERTY AND EQUIPMENT, NET Property, equipment and purchased software are recorded at original cost and increased by the cost of any significant improvements after purchase. We expense maintenance and repairs when incurred. Depreciation and amortization is calculated using the straight-line method over the shorter of the asset’s estimated useful life or the term of the lease in the case of leasehold improvements. For income tax purposes, we use accelerated depreciation methods as allowed by tax laws. |
Research and Development Costs | RESEARCH AND DEVELOPMENT COSTS We expensed research and development costs of $63.3 million in 2018 , $47.3 million in 2017 , and $43.2 million in 2016 . |
Income Taxes | INCOME TAXES Income taxes are accounted for under the asset and liability method. Deferred taxes arise because of different treatment between financial statement accounting and tax accounting, known as “temporary differences.” We record the tax effect of these temporary differences as “deferred tax assets” (generally items that can be used as a tax deduction or credit in the future periods) and “deferred tax liabilities” (generally items that we received a tax deduction for, which have not yet been recorded in the income statement). The deferred tax assets and liabilities are measured using enacted tax rules and laws that are expected to be in effect when the temporary differences are expected to be recovered or settled. A valuation allowance would be established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be "realized." On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act amends the Internal Revenue Code to reduce tax rates and modify policies, credits and deductions for individuals and businesses. For businesses, the Tax Act reduces the corporate U.S. federal tax rate from a maximum of 35% to a flat 21% rate and transitions from a worldwide tax system to a territorial tax system. Under ASC 740 Income Taxes, the effects of changes in tax rates and laws are recognized in the period in which the new legislation is enacted. See Note 7 - "Income Tax" for further discussion related to the Tax Act. |
Share-Based Compensation | SHARE-BASED COMPENSATION We have a share-based award plan that provides for the grant of stock options, restricted stock units, and performance share units to key employees, directors and non-employee consultants. Stock options generally vest after three to six years of continuous service from the date of grant and have a contractual term of 10 years. Restricted stock unit grants generally vest ratably over three to five years of continuous service from the date of grant. Each performance share unit represents the right to receive one share of our common stock based on our achievement of certain financial performance targets during applicable performance periods. We account for share-based compensation utilizing the fair value recognition pursuant to ASC 718, Stock Compensation . See Note 9 – “Share-Based Compensation” for further information. |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill Goodwill represents the excess of the purchase price over the fair value of net assets acquired, including identifiable intangible assets, in connection with our business combinations. Upon acquisition, goodwill is assigned to the reporting unit that is expected to benefit from the synergies of the business combination, which is the reporting unit to which the related acquired technology is assigned. A reporting unit is the operating segment, or a business unit one level below that operating segment, for which discrete financial information is prepared and regularly reviewed by executive management. We assess goodwill for impairment annually as of April 1st, or more frequently whenever events or changes in circumstances indicate its carrying value may not be recoverable. We begin with the qualitative assessment of whether it is more likely than not that a reporting unit's fair value is less than its carrying value before applying the quantitative assessment described below. If it is determined through the evaluation of events or circumstances that the carrying value may not be recoverable, we perform a comparison of the estimated fair value of the reporting unit to which the goodwill has been assigned to the sum of the carrying value of the assets and liabilities of that unit. If the sum of the carrying value of the assets and liabilities of a reporting unit exceeds the estimated fair value of that reporting unit, the carrying value of the reporting unit's goodwill is reduced to its fair value through an adjustment to the goodwill balance, resulting in an impairment charge. The fair values calculated in our impairment tests are determined using discounted cash flow models involving several assumptions. The assumptions that are used are based upon what we believe a hypothetical marketplace participant would use in estimating fair value. We evaluate the reasonableness of the fair value calculations of our reporting units by comparing the total of the fair value of all of our reporting units to our total market capitalization. We did not record any goodwill impairment charges for the years ended December 31, 2018 and 2017 . See Note 4 - Goodwill and Other Intangible Assets, for additional information. Other Intangible Assets We make judgments about the recoverability of purchased intangible assets other than goodwill whenever events or changes in circumstances indicate that an impairment may exist. Customer base and acquired software each comprise approximately half of our purchased intangible assets other than goodwill. We review our customer turnover each year for indications of impairment. Our customer turnover has historically been very low. If indications of impairment are determined to exist, we measure the recoverability of assets by a comparison of the carrying amount of the asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the assets exceeds their estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the assets exceeds the fair value of the assets. |
Impairment of Long-Lived Assets | IMPAIRMENT OF LONG-LIVED ASSETS We periodically evaluate whether current facts or circumstances indicate that the carrying value of our property and equipment or other long-lived assets to be held and used may not be recoverable. If such circumstances are determined to exist, we measure the recoverability of assets to be held and used by a comparison of the carrying amount of the asset or appropriate grouping of assets and the estimated undiscounted future cash flows expected to be generated by the assets. If the carrying amount of the assets exceeds their estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell, and would no longer be depreciated. The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the balance sheet. There have been no significant impairments of long-lived assets in any of the periods presented. |
Costs of Computer Software | COSTS OF COMPUTER SOFTWARE We capitalize software development costs upon the establishment of technological feasibility and prior to the availability of the product for general release to customers. Software development costs primarily consist of personnel costs and rent for related office space. We begin to amortize capitalized costs when a product is available for general release to customers. Amortization expense is determined on a product-by-product basis at a rate not less than straight-line basis over the product’s remaining estimated economic life. We have not capitalized any internal software development costs in any of the periods presented. |
Fair Value of Financial Instruments | FAIR VALUE OF FINANCIAL INSTRUMENTS Cash and cash equivalents, accounts receivables, accounts payables, short-term obligations and certain other assets at cost approximate fair value because of the short maturity of these instruments. The fair value of our revolving line of credit would approximate book value as of December 31, 2018 , because our interest rates reset approximately every 30 days or less. See Note 6 – “Revolving Line of Credit” for further discussion. As of December 31, 2018 , we have $97.7 million in investment grade corporate bonds, municipal bonds and asset-backed securities with maturity dates ranging from 2018 through 2022 . We intend to hold these bonds to maturity and have classified them as such. We believe cost approximates fair value because of the relatively short duration of these investments. The fair values of these securities are considered Level II as they are based on inputs from quoted prices in markets that are not active or from other observable market data. These investments are included in short-term investments and non-current investments and other assets. As of December 31, 2018 , we have $15.0 million invested in convertible preferred stock representing a 20% interest in Record Holdings Pty Limited, a privately held Australian company specializing in digitizing the spoken word in court and legal proceedings. The investment in convertible preferred stock is accounted under the cost method because we do not have the ability to exercise significant influence over the investee and the securities do not have readily determinable fair values. Our investment is carried at cost less any impairment write-downs. Annually, our cost method investments are assessed for impairment. We do not reassess the fair value of cost method investments if there are no identified events or changes in circumstances that may have a significant adverse effect on the fair value of the investments. There has been no impairment of our cost method investment for the periods presented. This investment is included in non-current investments and other assets in the accompanying consolidated balance sheets. |
Concentrations of Credit Risk | CONCENTRATIONS OF CREDIT RISK Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents, accounts receivable from trade customers, and investments in marketable securities. Our cash and cash equivalents primarily consist of operating account balances and money market funds, which are maintained at several major domestic financial institutions and the balances often exceed insured amounts. As of December 31, 2018 , we had cash and cash equivalents of $134.3 million . We perform periodic evaluations of the credit standing of these financial institutions. Concentrations of credit risk with respect to receivables are limited due to the size and geographical diversity of our customer base. Historically, our credit losses have not been significant. As a result, we do not believe we have any significant concentrations of credit risk as of December 31, 2018 . We maintain allowances for doubtful accounts, which are provided at the time the revenue is recognized. Since most of our customers are domestic governmental entities, we rarely incur a loss resulting from the inability of a customer to make required payments. Events or changes in circumstances that indicate the carrying amount for the allowances for doubtful accounts may require revision include, but are not limited to, deterioration of a customer’s financial condition, failure to manage our customer’s expectations regarding the scope of the services to be delivered, and defects or errors in new versions or enhancements of our software products. |
Indemnification | INDEMNIFICATION Most of our software license agreements indemnify our customers in the event that the software sold infringes upon the intellectual property rights of a third-party. These agreements typically provide that in such event we will either modify or replace the software so that it becomes non-infringing or procure for the customer the right to use the software. We have recorded no liability associated with these indemnifications, as we are not aware of any pending or threatened infringement actions that are possible losses. We believe the estimated fair value of these intellectual property indemnification clauses is minimal. We have also agreed to indemnify our officers and board members if they are named or threatened to be named as a party to any proceeding by reason of the fact that they acted in such capacity. We maintain directors’ and officers’ liability insurance coverage to protect against any such losses. We have recorded no liability associated with these indemnifications. Because of our insurance coverage, we believe the estimated fair value of these indemnification agreements is minimal. |
Reclassifications | RECLASSIFICATIONS Certain amounts for previous years have been reclassified to conform to the current year presentation. |
Recently Adopted Accounting Pronouncements and New Accounting Pronouncements | RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS Revenue from Contracts with Customers . In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09, Revenue from Contracts with Customers . ASU No. 2014-09 supersedes the revenue recognition requirements in Accounting Standards Codification ("ASC") Topic 605, Revenue Recognition , and requires the recognition of revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. This model involves a five-step process that includes identifying the contract with the customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract and recognizing revenue when (or as) the entity satisfies the performance obligations. Topic 606 also includes Subtopic 340-40 Other Assets and Deferred Costs - Contracts with Customers , which requires the deferral of incremental costs of obtaining a contract with a customer. Collectively, we refer to ASU No. 2014-09 and Subtopic 340-40 as the "new standard." We adopted the requirements of the new standard as of January 1, 2018, utilizing the full retrospective method of transition. Adoption of the new standard resulted in changes to our accounting policies for revenue recognition, trade and other receivables, and deferred commissions as detailed below. We applied the new standard using a practical expedient where the consideration allocated to the remaining performance obligations or an explanation of when we expect to recognize that amount as revenue for all reporting periods presented before the date of the initial application is not disclosed. The impact of adopting ASU No. 2014-09 on our total revenues for 2017 and 2016 was not material. The impact of adopting the new standard on our retained earnings and deferred commissions is material. The most significant impact of the new standard relates to our accounting for software license revenue. Specifically, under the new standard, software license fees under perpetual agreements are no longer subject to 100% discount allocations from other performance obligations in the contract. Discounts in arrangements are allocated across all performance obligations increasing license revenues and decreasing revenues allocated to other performance obligations. In addition, in most cases, net license fees (total license fees less any allocated discounts) are recognized at the point in time when control of the software license transfers to the customer versus our legacy policy of recognizing revenue upon delivery and only to the extent billable per the contractual terms. Under the new standard, time-based license fees are no longer recognized over the contractual period of the license and are instead recognized at the point in time when the control of the software license transfers to the customer. Revenues related to our PCS renewals, SaaS offerings and appraisal services remain substantially unchanged. Due to the complexity of certain contracts, the actual revenue recognition treatment required under the new standard is dependent on contract-specific terms and may vary in some instances from recognition at the time of billing. Adoption of the new standard requires that incremental costs directly related to obtaining a contract (typically sales commissions) must be recognized as an asset and expensed on a systematic basis that is consistent with the transfer to the customer of the goods and services to which the asset relates, unless that life is less than one year. Prior to adoption of the new standard, we deferred sales commissions and recognized expense over the relevant initial contractual term, which was generally one to two years. Under the new standard, we amortize these costs over a period of benefit that we have determined to be three to seven years. We adjusted our consolidated financial statements from amounts previously reported due to the adoption of the new standard. Select unaudited condensed consolidated statement of income line items, which reflect the adoption of the new standard, are as follows (in thousands, except per share data): December 31, 2017 December 31, 2016 As Reported Adjustments As Adjusted As Reported Adjustments As Adjusted Statement of Income: Software licenses and royalties $ 75,694 $ 10,548 $ 86,242 $ 74,306 $ 9,427 $ 83,733 Subscriptions 173,510 (1,334 ) 172,176 142,704 (47 ) 142,657 Software services 187,149 (6,689 ) 180,460 174,804 (3,156 ) 171,648 Maintenance 361,569 (2,250 ) 359,319 322,969 (1,971 ) 320,998 Appraisal services 25,023 — 25,023 26,287 — 26,287 Hardware and other 17,717 (38 ) 17,679 14,973 (416 ) 14,557 Total revenues 840,662 237 840,899 756,043 3,837 759,880 Selling, general and administrative expenses 176,974 (1,060 ) 175,914 167,161 (1,985 ) 165,176 Amortization of customer and trade name intangibles 13,912 (531 ) 13,381 13,731 (529 ) 13,202 Operating income 160,930 1,828 162,758 131,305 6,351 137,656 Income tax (benefit) provision (2,317 ) (3,798 ) (6,115 ) 19,450 2,507 21,957 Net income $ 163,945 $ 5,626 $ 169,571 $ 109,857 $ 3,844 $ 113,701 Earnings per common share: Basic $ 4.40 $ 4.55 $ 3.01 $ 3.12 Diluted $ 4.18 $ 4.32 $ 2.87 $ 2.92 Select condensed consolidated balance sheet line items, which reflect the adoption of the new standard, are as follows (in thousands): December 31, 2017 As Reported Adjustments As Adjusted Balance Sheet: Accounts receivable $ 227,127 $ 19,061 $ 246,188 Prepaid expenses 27,252 4,954 32,206 Accounts receivable, long-term 7,536 4,571 12,107 Other intangibles, net 236,444 (6,827 ) 229,617 Total assets 1,589,592 21,759 1,611,351 Deferred revenue 309,461 (10,848 ) 298,613 Deferred income taxes 38,914 7,965 46,879 Retained earnings 599,821 24,642 624,463 Total liabilities and shareholders' equity $ 1,589,592 $ 21,759 $ 1,611,351 Our adoption of ASU No. 2014-09 had no impact on our net cash provided by or used in operating, investing or financing activities for any of the periods reported. Recent tax legislation . On December 22, 2017, the Tax Cuts and Jobs Act ("Tax Act") was enacted into law. The Tax Act amends the Internal Revenue Code to reduce tax rates and modify policies, credits and deductions for businesses and individuals. For businesses, the Tax Act reduces the U.S. corporate federal income tax rate from a maximum of 35% to a flat 21% rate and transitions from a worldwide tax system to a territorial tax system. The Tax Act also adds many new provisions including changes to bonus depreciation, the deduction for executive compensation and a tax on global intangible low-taxed income (GILTI). The most significant impact of the Tax Act to us is the reduction in the U.S. federal corporate income tax rate. Refer to Note 7 - Income Tax Provision for further information. NEW ACCOUNTING PRONOUNCEMENTS Recent Accounting Guidance not yet Adopted Leases. On February 25, 2016, the FASB issued its new lease accounting guidance in ASU No. 2016-02, Leases ("Topic 842"). Under the new guidance, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: • A lease liability, which is a lessee‘s obligation to make lease payments arising from a lease, measured on a discounted basis; and • A right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Topic 842 is effective for fiscal years beginning after December 15, 2018, including interim periods therein. Early application is permitted for all business entities upon issuance. Upon adoption, entities will be required to use a modified retrospective approach with an option to use certain practical expedients. We expect to adopt ASU 2016-02 when effective, using the transition method that allows us to initially apply the guidance at the adoption date of January 1, 2019, and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We expect to use the package of practical expedients that allows us to not reassess: (1) lease classification for any expired or existing leases and (2) initial direct costs for any expired or existing leases. We expect ASU 2016-02 will impact our consolidated financial statements and related disclosures. We are currently evaluating the extent of the impact and expect that most of our lease commitments will be subject to the updated guidance and recognized as lease liabilities and right-of-use assets on our consolidated balance sheets upon adoption. Based on our current portfolio of leases, we estimate a range of $15.5 million to $17.8 million of lease assets and liabilities to be recognized on our balance sheet, primarily relating to office facilities. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Accounts, Notes, Loans and Financing Receivable | The following table summarizes the changes in the allowances for doubtful accounts and sales adjustments: Years Ended December 31, 2018 2017 2016 Balance at beginning of year $ 5,427 $ 3,396 $ 1,640 Provisions for losses - accounts receivable 2,286 4,110 4,484 Collection of accounts previously written off — — — Deductions for accounts charged off or credits issued (3,066 ) (2,079 ) (2,728 ) Balance at end of year $ 4,647 $ 5,427 $ 3,396 |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | We adjusted our consolidated financial statements from amounts previously reported due to the adoption of the new standard. Select unaudited condensed consolidated statement of income line items, which reflect the adoption of the new standard, are as follows (in thousands, except per share data): December 31, 2017 December 31, 2016 As Reported Adjustments As Adjusted As Reported Adjustments As Adjusted Statement of Income: Software licenses and royalties $ 75,694 $ 10,548 $ 86,242 $ 74,306 $ 9,427 $ 83,733 Subscriptions 173,510 (1,334 ) 172,176 142,704 (47 ) 142,657 Software services 187,149 (6,689 ) 180,460 174,804 (3,156 ) 171,648 Maintenance 361,569 (2,250 ) 359,319 322,969 (1,971 ) 320,998 Appraisal services 25,023 — 25,023 26,287 — 26,287 Hardware and other 17,717 (38 ) 17,679 14,973 (416 ) 14,557 Total revenues 840,662 237 840,899 756,043 3,837 759,880 Selling, general and administrative expenses 176,974 (1,060 ) 175,914 167,161 (1,985 ) 165,176 Amortization of customer and trade name intangibles 13,912 (531 ) 13,381 13,731 (529 ) 13,202 Operating income 160,930 1,828 162,758 131,305 6,351 137,656 Income tax (benefit) provision (2,317 ) (3,798 ) (6,115 ) 19,450 2,507 21,957 Net income $ 163,945 $ 5,626 $ 169,571 $ 109,857 $ 3,844 $ 113,701 Earnings per common share: Basic $ 4.40 $ 4.55 $ 3.01 $ 3.12 Diluted $ 4.18 $ 4.32 $ 2.87 $ 2.92 Select condensed consolidated balance sheet line items, which reflect the adoption of the new standard, are as follows (in thousands): December 31, 2017 As Reported Adjustments As Adjusted Balance Sheet: Accounts receivable $ 227,127 $ 19,061 $ 246,188 Prepaid expenses 27,252 4,954 32,206 Accounts receivable, long-term 7,536 4,571 12,107 Other intangibles, net 236,444 (6,827 ) 229,617 Total assets 1,589,592 21,759 1,611,351 Deferred revenue 309,461 (10,848 ) 298,613 Deferred income taxes 38,914 7,965 46,879 Retained earnings 599,821 24,642 624,463 Total liabilities and shareholders' equity $ 1,589,592 $ 21,759 $ 1,611,351 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Schedule of the allocation of the purchase price as of the acquisition date | We have performed a valuation analysis of the fair market value of Socrata’s assets and liabilities. The following table summarizes the allocation of the purchase price as of the acquisition date: In thousands Cash $ 1,724 Accounts receivable 3,616 Other current assets 2,057 Other noncurrent assets 68 Deferred tax assets, net 20 Identifiable intangible assets 75,000 Goodwill 75,657 Accounts payable (1,254 ) Accrued expenses (1,604 ) Deferred revenue (5,915 ) Total consideration $ 149,369 |
Schedule of pro forma information | The following unaudited pro forma information of the consolidated results of operations have been prepared as if the Socrata acquisition had occurred at January 1, 2017, after giving effect to certain adjustments, including amortization of intangibles, interest, transaction costs and tax effects. Twelve Months Ended December 31, 2018 2017 Revenues $ 943,723 $ 865,944 Net income 139,315 150,515 Basic earnings per share 3.62 4.04 Diluted earnings per share $ 3.47 $ 3.84 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment, Net | Property and equipment, net consists of the following at December 31: Useful Lives (years) 2018 2017 Land — $ 9,958 $ 9,958 Building and leasehold improvements 5-39 122,241 116,214 Computer equipment and purchased software 3-5 84,649 72,531 Furniture and fixtures 5 27,238 24,834 Transportation equipment 5 438 476 244,524 224,013 Accumulated depreciation and amortization (89,347 ) (71,698 ) Property and equipment, net $ 155,177 $ 152,315 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Other Intangible Assets and Related Accumulated Amortization | Other intangible assets and related accumulated amortization consists of the following at December 31: 2018 2017 As Adjusted Gross carrying amount of acquisition intangibles: Customer related intangibles $ 238,219 $ 179,789 Acquired software 202,416 179,466 Trade names 16,905 11,435 Leases acquired 3,694 3,694 461,234 374,384 Accumulated amortization (184,382 ) (144,767 ) Total intangibles, net $ 276,852 $ 229,617 |
Summary of Allocation of Acquisition Intangible Assets | The allocation of acquisition intangible assets is summarized in the following table: December 31, 2018 December 31, 2017 As Adjusted Gross Carrying Amount Weighted Average Amortization Period Accumulated Amortization Gross Carrying Amount Weighted Average Amortization Period Accumulated Amortization Non-amortizable intangibles: Goodwill $ 753,718 — $ — $ 657,987 — $ — Amortizable intangibles: Customer related intangibles 238,219 15 years 78,120 179,789 15 years 63,274 Acquired software 202,416 7 years 99,772 179,466 7 years 76,800 Trade names 16,905 11 years 5,139 11,435 11 years 3,768 Leases acquired 3,694 10 years 1,351 3,694 10 years 925 |
Summary of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the two years ended December 31, 2018 are as follows: Enterprise Software Appraisal and Tax Total Balance as of 12/31/2016 $ 643,680 $ 6,557 $ 650,237 Goodwill acquired with acquisitions 7,750 — 7,750 Balance as of 12/31/2017 651,430 6,557 657,987 Goodwill acquired related to the purchase of Socrata 75,657 — 75,657 Goodwill acquired related to other acquisitions 20,074 — 20,074 Balance as of 12/31/2018 $ 747,161 $ 6,557 $ 753,718 |
Summary of Estimated Annual Amortization Expense | Estimated annual amortization expense related to acquisition intangibles, including acquired software, for which the amortization expense is recorded as cost of revenues, is as follows: 2019 $ 40,222 2020 38,820 2021 38,463 2022 34,987 2023 16,990 Thereafter 105,028 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accrued Liabilities, Current [Abstract] | |
Summary of Accrued Liabilities | Accrued liabilities consist of the following at December 31: 2018 2017 Accrued wages, bonuses and commissions $ 40,100 $ 43,688 Other accrued liabilities 26,380 20,987 $ 66,480 $ 64,675 |
Income Tax (Tables)
Income Tax (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax Provision (Benefit) on Income from Operations | The Income tax provision (benefit) on income from operations consists of the following: Years Ended December 31, 2018 2017 2016 As Adjusted As Adjusted Current: Federal $ 9,110 $ 22,883 $ 41,366 State 4,367 4,666 7,023 13,477 27,549 48,389 Deferred (5,069 ) (33,664 ) (26,432 ) $ 8,408 $ (6,115 ) $ 21,957 |
Reconciliation of U.S. Statutory Income Tax Rate to Effective Income Tax Expense Rate | Reconciliation of the U.S. statutory income tax rate to our effective income tax expense rate for operations follows: Years Ended December 31, 2018 2017 2016 As Adjusted As Adjusted Federal income tax expense at statutory rate $ 32,733 $ 57,209 $ 47,480 State income tax, net of federal income tax benefit 7,953 4,754 5,091 Domestic production activities deduction — (2,617 ) (3,947 ) Excess tax benefits related to stock option exercises (32,487 ) (40,624 ) (29,582 ) Tax Act adjustments (1,750 ) (25,992 ) — Tax credits (3,715 ) (3,578 ) — Non-deductible business expenses 5,655 4,573 2,979 Other, net 19 160 (64 ) $ 8,408 $ (6,115 ) $ 21,957 |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of the major items recorded as deferred tax assets and liabilities as of December 31 are: 2018 2017 As Adjusted Deferred income tax assets: Operating expenses not currently deductible $ 8,989 $ 9,714 Stock option and other employee benefit plans 19,496 15,932 Loss and credit carryforwards 17,999 — Total deferred income tax assets 46,484 25,646 Valuation allowance (1,049 ) — Total deferred income tax assets, net of valuation allowance 45,435 25,646 Deferred income tax liabilities: Intangible assets (70,752 ) (60,189 ) Property and equipment (8,455 ) (5,699 ) Prepaid expenses (4,079 ) (190 ) Deferred revenue (3,940 ) (6,447 ) Total deferred income tax liabilities (87,226 ) (72,525 ) Net deferred income tax liabilities $ (41,791 ) $ (46,879 ) |
Summary of Positions for which Significant Change in Unrecognized Tax Benefits | The aggregate changes in the balance of unrecognized tax benefits were as follows: 2018 Balance at beginning of year $ — Increases for tax positions related to prior years 1,929 Balance at end of year $ 1,929 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Summary of Activities in Common Stock | The following table details activity in our common stock: Years Ended December 31, 2018 2017 2016 Shares Amount Shares Amount Shares Amount Stock option exercises 1,126 $ 74,907 1,113 $ 49,845 827 $ 23,527 Purchases of common stock (781 ) (150,050 ) (44 ) (6,613 ) (882 ) (112,699 ) Employee stock plan purchases 45 8,051 51 7,044 47 6,236 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Weighted Average Assumptions Used for Options Granted | The following weighted average assumptions were used for options granted: Years Ended December 31, 2018 2017 2016 Expected life (in years) 6.0 6.0 6.0 Expected volatility 26.7 % 28.1 % 29.3 % Risk-free interest rate 2.7 % 2.0 % 1.8 % Expected forfeiture rate — % — % — % |
Summarizes Restricted Stock Unit and Performance Share Activity | The following table summarizes restricted stock unit and performance stock unit activity during fiscal year 2018 (shares in thousands): Number of Shares Weighted Average Grant Date Fair Value per Share Unvested at January 1, 2018 — $ — Granted 336 $ 221.29 Vested — $ — Forfeited (2 ) $ 229.75 Unvested at December 31, 2018 334 $ 221.25 |
Stock Option Activity | Other information pertaining to option activity was as follows during the twelve months ended December 31: 2018 2017 2016 Weighted average grant-date fair value of stock options granted $ 66.52 $ 55.56 $ 46.89 Total intrinsic value of stock options exercised 176,716 137,699 103,703 Options granted, exercised, forfeited and expired are summarized as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at December 31, 2015 5,164 $ 64.43 Granted 846 147.25 Exercised (827 ) 28.43 Forfeited (27 ) 95.33 Outstanding at December 31, 2016 5,156 83.64 Granted 824 176.26 Exercised (1,113 ) 44.80 Forfeited (50 ) 134.83 Outstanding at December 31, 2017 4,817 107.91 Granted 432 208.21 Exercised (1,126 ) 66.53 Forfeited (31 ) 158.80 Outstanding at December 31, 2018 4,092 129.51 7 $ 240,069 Exercisable at December 31, 2018 2,357 100.41 6 $ 201,349 |
Summary of Share-Based Compensation Expense Related to Share-Based Awards | The following table summarizes share-based compensation expense related to share-based awards which is recorded in the statements of comprehensive income: Years Ended December 31, 2018 2017 2016 Cost of software services, maintenance and subscriptions $ 13,588 $ 9,415 $ 6,548 Selling, general and administrative expenses 39,152 27,933 23,199 Total share-based compensation expenses 52,740 37,348 29,747 Tax benefit (32,487 ) (40,624 ) (30,059 ) Net decrease (increase) in net income $ 20,253 $ (3,276 ) $ (312 ) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Computation of Basic Earnings and Diluted Earnings Per Share Data | Basic earnings and diluted earnings per share data were computed as follows: Years Ended December 31, 2018 2017 2016 As Adjusted As adjusted Numerator for basic and diluted earnings per share: Net income $ 147,462 $ 169,571 $ 113,701 Denominator: Weighted-average basic common shares outstanding 38,445 37,273 36,448 Assumed conversion of dilutive securities: Stock options 1,678 1,973 2,513 Denominator for diluted earnings per share - Adjusted weighted-average shares 40,123 39,246 38,961 Earnings per common share: Basic $ 3.84 $ 4.55 $ 3.12 Diluted $ 3.68 $ 4.32 $ 2.92 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Leases [Abstract] | |
Summary of Future Minimum Lease Payments | Future minimum lease payments under all non-cancelable leases at December 31, 2018 are as follows: Years Ending December 31, 2019 $ 5,994 2020 5,146 2021 3,976 2022 1,925 2023 1,164 Thereafter 2,132 Total $ 20,337 |
Segment and Related Informati_2
Segment and Related Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Segment Revenues and Operations | For the year ended December 31, 2018 Enterprise Software Appraisal and Tax Corporate Totals Revenues Software licenses and royalties $ 83,735 $ 9,706 $ — $ 93,441 Subscriptions 210,740 9,807 — 220,547 Software services 166,921 24,348 — 191,269 Maintenance 359,904 24,617 — 384,521 Appraisal services — 21,846 — 21,846 Hardware and other 18,745 32 4,881 23,658 Intercompany 13,155 — (13,155 ) — Total revenues $ 853,200 $ 90,356 $ (8,274 ) $ 935,282 Depreciation and amortization expense 50,130 914 10,715 61,759 Segment operating income 237,159 23,094 (68,572 ) 191,681 Capital expenditures 13,973 782 10,377 25,132 Segment assets $ 556,100 $ 63,670 $ 1,171,193 $ 1,790,963 For the year ended December 31, 2017 (As Adjusted) Enterprise Software Appraisal and Tax Corporate Totals Revenues Software licenses and royalties $ 78,388 $ 7,854 $ — $ 86,242 Subscriptions 164,317 7,859 — 172,176 Software services 161,245 19,215 — 180,460 Maintenance 337,701 21,618 — 359,319 Appraisal services — 25,023 — 25,023 Hardware and other 13,057 10 4,612 17,679 Intercompany 10,425 — (10,425 ) — Total revenues $ 765,133 $ 81,579 $ (5,813 ) $ 840,899 Depreciation and amortization expense 43,987 760 8,648 53,395 Segment operating income 229,001 20,788 (51,964 ) 197,825 Capital expenditures 28,096 1,181 16,341 45,618 Segment assets $ 365,736 $ 46,279 $ 1,199,336 $ 1,611,351 For the year ended December 31, 2016 (As Adjusted) Enterprise Software Appraisal and Tax Corporate Totals Revenues Software licenses and royalties $ 78,271 $ 5,462 $ — $ 83,733 Subscriptions 135,469 7,188 — 142,657 Software services 155,322 16,326 — 171,648 Maintenance 302,409 18,589 — 320,998 Appraisal services — 26,287 — 26,287 Hardware and other 11,526 16 3,015 14,557 Intercompany 6,742 — (6,742 ) — Total revenues $ 689,739 $ 73,868 $ (3,727 ) $ 759,880 Depreciation and amortization expense 43,434 984 5,355 49,773 Segment operating income 196,054 18,871 (41,832 ) 173,093 Capital expenditures 23,843 1,432 11,448 36,723 Segment assets $ 321,886 $ 33,005 $ 1,023,612 $ 1,378,503 |
Reconciliation of Operating Income from Segments to Consolidated | Reconciliation of reportable segment operating Years Ended December 31, income to the Company's consolidated totals: 2018 2017 2016 As Adjusted As Adjusted Total segment operating income $ 191,681 $ 197,825 $ 173,093 Amortization of acquired software (22,972 ) (21,686 ) (22,235 ) Amortization of customer and trade name intangibles (16,217 ) (13,381 ) (13,202 ) Other income (expense), net 3,378 698 (1,998 ) Income before income taxes $ 155,870 $ 163,456 $ 135,658 |
Disaggregation of Revenue (Tabl
Disaggregation of Revenue (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of disaggregation of revenue | Recurring revenues and non-recurring revenues recognized during the period are as follows: For the year ended December 31, 2018 Enterprise Software Appraisal and Tax Corporate Totals Recurring revenues $ 570,645 $ 34,424 $ — $ 605,069 Non-recurring revenues 269,400 55,932 4,881 330,213 Intercompany 13,155 — (13,155 ) — Total revenues $ 853,200 $ 90,356 $ (8,274 ) $ 935,282 For the year ended December 31, 2017 (As Adjusted) Enterprise Software Appraisal and Tax Corporate Totals Recurring revenues $ 502,018 $ 29,477 $ — $ 531,495 Non-recurring revenues 252,690 52,102 4,612 309,404 Intercompany 10,425 — (10,425 ) — Total revenues $ 765,133 $ 81,579 $ (5,813 ) $ 840,899 Timing of revenue recognition by revenue category during the period is as follows: For the year ended December 31, 2018 Products and services transferred at a point in time Products and services transferred over time Total Revenues Software licenses and royalties $ 75,188 $ 18,253 $ 93,441 Subscriptions — 220,547 220,547 Software services — 191,269 191,269 Maintenance — 384,521 384,521 Appraisal services — 21,846 21,846 Hardware and other 23,658 — 23,658 Total $ 98,846 $ 836,436 $ 935,282 For the year ended December 31, 2017 (As Adjusted) Products and services transferred at a point in time Products and services transferred over time Total Revenues Software licenses and royalties $ 69,167 $ 17,075 $ 86,242 Subscriptions — 172,176 172,176 Software services — 180,460 180,460 Maintenance — 359,319 359,319 Appraisal services — 25,023 25,023 Hardware and other 17,679 — 17,679 Total $ 86,846 $ 754,053 $ 840,899 |
Deferred Revenue and Performa_2
Deferred Revenue and Performance Obligations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Changes in deferred revenue | Changes in total deferred revenue, including long-term, were as follows: 2018 Balance at beginning of year (As Adjusted) $ 299,887 Deferral of revenue 871,498 Recognition of deferred revenue (820,449 ) Balance at end of year $ 350,936 Total deferred revenue, including long-term, by segment is as follows: December 31, 2018 December 31, 2017 As Adjusted Enterprise Software $ 327,521 $ 277,198 Appraisal and Tax 20,018 20,387 Corporate 3,397 2,302 Totals $ 350,936 $ 299,887 |
Quarterly Financial Informati_2
Quarterly Financial Information (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | QUARTERLY FINANCIAL INFORMATION (unaudited) The following table contains selected financial information from unaudited statements of income for each quarter of 2018 and 2017 : Quarters Ended 2018 2017 (As Adjusted) Dec. 31 Sept. 30 June 30 Mar. 31 Dec. 31(a) Sept. 30 June 30 Mar. 31 Revenues $ 241,981 $ 236,067 $ 236,060 $ 221,174 $ 217,701 $ 214,706 $ 208,763 $ 199,729 Gross profit 115,871 111,626 109,276 102,805 105,350 103,989 95,503 94,535 Income before income taxes 40,107 38,626 37,700 39,437 45,261 44,357 37,197 36,641 Net income 31,552 38,924 39,161 37,825 66,196 38,836 31,770 32,769 Earnings per diluted share $ 0.79 $ 0.96 $ 0.97 $ 0.95 $ 1.68 $ 0.99 $ 0.81 $ 0.84 Shares used in computing diluted earnings per share 39,891 40,528 40,224 39,836 39,499 39,342 39,201 38,932 (a) The fourth quarter of 2017 includes the significant impact of the enactment of the Tax Act. The most significant impact of the Tax Act to us is the reduction in the U.S. federal corporate income tax rate from 35% to 21%. The impact of the rate reduction on our 2017 income tax provision is a $26.0 million tax benefit due to the remeasurement of deferred tax assets and liabilities. Refer to Note 7 - "Income Tax" for further discussion on the impact the Tax Act. |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accounting Policies [Line Items] | |||||
Accounts receivable, net | $ 314,900,000 | $ 258,300,000 | $ 226,800,000 | ||
Research and development expense | 63,264,000 | 47,324,000 | 43,154,000 | ||
Impairments of intangible assets | 0 | 0 | 0 | ||
Impairments of long-lived assets | 0 | 0 | 0 | ||
Purchase of held to maturity securities | $ 97,700,000 | ||||
Grade corporate and municipal bonds, maturity date | 2018 through 2022 | ||||
Cost-method investment impairment | $ 0 | 0 | 0 | ||
Cash and cash equivalents | 134,279,000 | $ 185,926,000 | $ 36,151,000 | $ 33,087,000 | |
Convertible Preferred Stock | Record Holdings Pty Limited | |||||
Accounting Policies [Line Items] | |||||
Cost method investment | $ 15,000,000 | ||||
Investment percentage | 20.00% | ||||
Minimum | |||||
Accounting Policies [Line Items] | |||||
Typical contract term (in years) | 3 years | 3 years | |||
Contract term (in years) | 1 year | ||||
Revenue from contract with customer, percentage withheld from progress billing | 5.00% | ||||
Accounts receivable, payment term (in days) | 30 days | ||||
Vesting period (in years) | 3 years | ||||
Sales commissions amortization period (in years) | 3 years | 3 years | 1 year | ||
Maximum | |||||
Accounting Policies [Line Items] | |||||
Typical contract term (in years) | 5 years | 5 years | |||
Contract term (in years) | 10 years | ||||
Revenue from contract with customer, percentage withheld from progress billing | 20.00% | ||||
Accounts receivable, payment term (in days) | 60 days | ||||
Vesting period (in years) | 6 years | ||||
Sales commissions amortization period (in years) | 7 years | 7 years | 2 years | ||
Stock Option Plan | |||||
Accounting Policies [Line Items] | |||||
Contractual term (in years) | 10 years | ||||
Stock Option Plan | Minimum | |||||
Accounting Policies [Line Items] | |||||
Vesting period (in years) | 3 years | ||||
Stock Option Plan | Maximum | |||||
Accounting Policies [Line Items] | |||||
Vesting period (in years) | 6 years | ||||
Unbilled Revenues | |||||
Accounting Policies [Line Items] | |||||
Accounts receivable, net | $ 104,200,000 | $ 64,600,000 | |||
Retention Receivable | Unbilled Revenues | |||||
Accounting Policies [Line Items] | |||||
Accounts receivable, net | $ 12,200,000 | $ 7,200,000 | |||
Subscription And Circulation - Hosting Services | Minimum | |||||
Accounting Policies [Line Items] | |||||
Contract term (in years) | 1 year | ||||
Subscription And Circulation - Hosting Services | Maximum | |||||
Accounting Policies [Line Items] | |||||
Contract term (in years) | 10 years | ||||
Appraisal services | Minimum | |||||
Accounting Policies [Line Items] | |||||
Contract term (in years) | 1 year | ||||
Appraisal services | Maximum | |||||
Accounting Policies [Line Items] | |||||
Contract term (in years) | 3 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Allowances for Doubtful Accounts and Sales Adjustments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Balance at beginning of year | $ 5,427 | $ 3,396 | $ 1,640 |
Provisions for losses - accounts receivable | 2,286 | 4,110 | 4,484 |
Collection of accounts previously written off | 0 | 0 | 0 |
Deductions for accounts charged off or credits issued | (3,066) | (2,079) | (2,728) |
Balance at end of year | 5,427 | $ 3,396 | |
Accounts receivable, allowance for losses | $ 4,647 | $ 5,427 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - New Accounting Standard (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 01, 2019 | |
Income Statement [Abstract] | ||||||||||||
Revenue | $ 241,981 | $ 236,067 | $ 236,060 | $ 221,174 | $ 217,701 | $ 214,706 | $ 208,763 | $ 199,729 | $ 935,282 | $ 840,899 | $ 759,880 | |
Selling, general and administrative expenses | 207,605 | 175,914 | 165,176 | |||||||||
Amortization of customer and trade name intangibles | 16,217 | 13,381 | 13,202 | |||||||||
Operating income | 152,492 | 162,758 | 137,656 | |||||||||
Income tax (benefit) provision | 8,408 | (6,115) | 21,957 | |||||||||
Net income | $ 31,552 | $ 38,924 | $ 39,161 | $ 37,825 | $ 66,196 | $ 38,836 | $ 31,770 | $ 32,769 | $ 147,462 | $ 169,571 | $ 113,701 | |
Earnings per common share: | ||||||||||||
Basic (USD per share) | $ 3.84 | $ 4.55 | $ 3.12 | |||||||||
Diluted (USD per share) | $ 0.79 | $ 0.96 | $ 0.97 | $ 0.95 | $ 1.68 | $ 0.99 | $ 0.81 | $ 0.84 | $ 3.68 | $ 4.32 | $ 2.92 | |
Balance Sheet [Abstract] | ||||||||||||
Accounts receivable | $ 298,912 | $ 246,188 | $ 298,912 | $ 246,188 | ||||||||
Prepaid expenses | 33,258 | 32,206 | 33,258 | 32,206 | ||||||||
Accounts receivable, long-term | 16,020 | 12,107 | 16,020 | 12,107 | ||||||||
Other intangibles, net | 276,852 | 229,617 | 276,852 | 229,617 | ||||||||
Total assets | 1,790,963 | 1,611,351 | 1,790,963 | 1,611,351 | $ 1,378,503 | |||||||
Deferred revenue | 350,512 | 298,613 | 350,512 | 298,613 | ||||||||
Deferred income taxes | 46,879 | 46,879 | ||||||||||
Retained earnings | 771,925 | 624,463 | 771,925 | 624,463 | ||||||||
Liabilities and Equity | $ 1,790,963 | 1,611,351 | 1,790,963 | 1,611,351 | ||||||||
Software licenses and royalties | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 93,441 | 86,242 | 83,733 | |||||||||
Subscriptions | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 220,547 | 172,176 | 142,657 | |||||||||
Software services | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 191,269 | 180,460 | 171,648 | |||||||||
Maintenance | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 384,521 | 359,319 | 320,998 | |||||||||
Appraisal services | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 21,846 | 25,023 | 26,287 | |||||||||
Hardware and other | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | $ 23,658 | 17,679 | 14,557 | |||||||||
As Reported | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 840,662 | 756,043 | ||||||||||
Selling, general and administrative expenses | 176,974 | 167,161 | ||||||||||
Amortization of customer and trade name intangibles | 13,912 | 13,731 | ||||||||||
Operating income | 160,930 | 131,305 | ||||||||||
Income tax (benefit) provision | (2,317) | 19,450 | ||||||||||
Net income | $ 163,945 | $ 109,857 | ||||||||||
Earnings per common share: | ||||||||||||
Basic (USD per share) | $ 4.40 | $ 3.01 | ||||||||||
Diluted (USD per share) | $ 4.18 | $ 2.87 | ||||||||||
Balance Sheet [Abstract] | ||||||||||||
Accounts receivable | 227,127 | $ 227,127 | ||||||||||
Prepaid expenses | 27,252 | 27,252 | ||||||||||
Accounts receivable, long-term | 7,536 | 7,536 | ||||||||||
Other intangibles, net | 236,444 | 236,444 | ||||||||||
Total assets | 1,589,592 | 1,589,592 | ||||||||||
Deferred revenue | 309,461 | 309,461 | ||||||||||
Deferred income taxes | 38,914 | 38,914 | ||||||||||
Retained earnings | 599,821 | 599,821 | ||||||||||
Liabilities and Equity | 1,589,592 | 1,589,592 | ||||||||||
As Reported | Software licenses and royalties | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 75,694 | $ 74,306 | ||||||||||
As Reported | Subscriptions | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 173,510 | 142,704 | ||||||||||
As Reported | Software services | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 187,149 | 174,804 | ||||||||||
As Reported | Maintenance | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 361,569 | 322,969 | ||||||||||
As Reported | Appraisal services | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 25,023 | 26,287 | ||||||||||
As Reported | Hardware and other | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 17,717 | 14,973 | ||||||||||
Adjustments | Accounting Standards Update 2014-09 | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 237 | 3,837 | ||||||||||
Selling, general and administrative expenses | (1,060) | (1,985) | ||||||||||
Amortization of customer and trade name intangibles | (531) | (529) | ||||||||||
Operating income | 1,828 | 6,351 | ||||||||||
Income tax (benefit) provision | (3,798) | 2,507 | ||||||||||
Net income | 5,626 | 3,844 | ||||||||||
Balance Sheet [Abstract] | ||||||||||||
Accounts receivable | 19,061 | 19,061 | ||||||||||
Prepaid expenses | 4,954 | 4,954 | ||||||||||
Accounts receivable, long-term | 4,571 | 4,571 | ||||||||||
Other intangibles, net | (6,827) | (6,827) | ||||||||||
Total assets | 21,759 | 21,759 | ||||||||||
Deferred revenue | (10,848) | (10,848) | ||||||||||
Deferred income taxes | 7,965 | 7,965 | ||||||||||
Retained earnings | 24,642 | 24,642 | ||||||||||
Liabilities and Equity | $ 21,759 | 21,759 | ||||||||||
Adjustments | Software licenses and royalties | Accounting Standards Update 2014-09 | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 10,548 | 9,427 | ||||||||||
Adjustments | Subscriptions | Accounting Standards Update 2014-09 | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | (1,334) | (47) | ||||||||||
Adjustments | Software services | Accounting Standards Update 2014-09 | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | (6,689) | (3,156) | ||||||||||
Adjustments | Maintenance | Accounting Standards Update 2014-09 | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | (2,250) | (1,971) | ||||||||||
Adjustments | Appraisal services | Accounting Standards Update 2014-09 | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | 0 | 0 | ||||||||||
Adjustments | Hardware and other | Accounting Standards Update 2014-09 | ||||||||||||
Income Statement [Abstract] | ||||||||||||
Revenue | $ (38) | $ (416) | ||||||||||
Minimum | Forecast | Accounting Standards Update 2016-02 | ||||||||||||
Balance Sheet [Abstract] | ||||||||||||
Lease right-of-use asset | $ 15,500 | |||||||||||
Lease liability | 15,500 | |||||||||||
Maximum | Forecast | Accounting Standards Update 2016-02 | ||||||||||||
Balance Sheet [Abstract] | ||||||||||||
Lease right-of-use asset | 17,800 | |||||||||||
Lease liability | $ 17,800 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Detail) - USD ($) $ in Thousands | Dec. 07, 2018 | Oct. 01, 2018 | Aug. 31, 2018 | Apr. 30, 2018 | Nov. 29, 2017 | Aug. 02, 2017 | May 30, 2017 | May 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||||||||||
Goodwill | $ 753,718 | $ 657,987 | $ 650,237 | ||||||||
Goodwill acquired | 7,750 | ||||||||||
SceneDoc. Inc | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Total purchase price to acquire business | $ 6,200 | ||||||||||
Cash to acquire business | 5,400 | ||||||||||
Accrued purchase price | $ 759 | ||||||||||
TradeMaster Inc. | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Total purchase price to acquire business | $ 5,300 | ||||||||||
CaseloadPRO, LP | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash to acquire business | $ 9,300 | ||||||||||
Socrata, Inc. | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash to acquire business | $ 147,600 | ||||||||||
Net cash acquired | 1,724 | ||||||||||
Tangible assets acquired | 7,500 | ||||||||||
Liabilities assumed | 8,800 | ||||||||||
Goodwill | 75,657 | ||||||||||
Goodwill acquired | 75,657 | ||||||||||
Goodwill, purchase accounting adjustments | 3,300 | ||||||||||
Identifiable intangible assets | 75,000 | ||||||||||
Deferred tax assets, net | $ 20 | ||||||||||
Acquisition related fees | 578 | ||||||||||
Revenue, actual | 13,900 | ||||||||||
Loss, actual | 11,500 | ||||||||||
Socrata, Inc. | Customer relationships, acquired software, and trade name | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Weighted average useful life (in years) | 14 years | ||||||||||
Sage Data Security, LLC | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Total purchase price to acquire business | $ 11,600 | ||||||||||
Tangible assets acquired | 1,800 | ||||||||||
Liabilities assumed | 730 | ||||||||||
Goodwill | 3,500 | ||||||||||
Identifiable intangible assets | $ 7,000 | ||||||||||
Weighted average useful life (in years) | 14 years | ||||||||||
Radio 1033, LLC | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash to acquire business | $ 1,400 | ||||||||||
Digital Health Department, Inc. | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash to acquire business | $ 3,900 | ||||||||||
Modria.com | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash to acquire business | $ 6,100 | ||||||||||
Accrued purchase price | 900 | ||||||||||
Net cash acquired | $ 7,000 | ||||||||||
ExecuTime Software, LLC | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Total purchase price to acquire business | $ 7,400 | ||||||||||
Enterprise Software | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Goodwill | 747,161 | 651,430 | $ 643,680 | ||||||||
Goodwill acquired | $ 7,750 | ||||||||||
Enterprise Software | Socrata, Inc. | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Goodwill acquired | $ 75,657 |
Acquisitions - Assets and Liabi
Acquisitions - Assets and Liabilities Acquired (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Apr. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 753,718 | $ 657,987 | $ 650,237 | |
Socrata, Inc. | ||||
Business Acquisition [Line Items] | ||||
Cash | $ 1,724 | |||
Accounts receivable | 3,616 | |||
Other current assets | 2,057 | |||
Other noncurrent assets | 68 | |||
Deferred tax assets, net | 20 | |||
Identifiable intangible assets | 75,000 | |||
Goodwill | 75,657 | |||
Accounts payable | (1,254) | |||
Accrued expenses | (1,604) | |||
Deferred revenue | (5,915) | |||
Total consideration | $ 149,369 |
Acquisitions - Pro-forma Inform
Acquisitions - Pro-forma Information (Details) - Socrata, Inc. - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | ||
Revenues | $ 943,723 | $ 865,944 |
Net income | $ 139,315 | $ 150,515 |
Basic earnings per share (usd per share) | $ 3.62 | $ 4.04 |
Diluted earnings per share (usd per share) | $ 3.47 | $ 3.84 |
Property and Equipment, Net - S
Property and Equipment, Net - Summary of Property and Equipment, Net (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 244,524 | $ 224,013 |
Accumulated depreciation and amortization | (89,347) | (71,698) |
Property and equipment, net | 155,177 | 152,315 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 9,958 | 9,958 |
Building and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 122,241 | 116,214 |
Building and leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful lives | 5 years | |
Building and leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful lives | 39 years | |
Computer equipment and purchased software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 84,649 | 72,531 |
Computer equipment and purchased software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful lives | 3 years | |
Computer equipment and purchased software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful lives | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 27,238 | 24,834 |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful lives | 5 years | |
Transportation equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 438 | $ 476 |
Transportation equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Useful lives | 5 years |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 21.2 | $ 17.3 | $ 13.4 |
Payment for construction to expand building | $ 2.2 | ||
Lease expiration year, earliest | 2,019 | ||
Lease expiration year, latest | 2,025 | ||
Expected rental income, during 2019 | $ 1.3 | ||
Expected rental income, during 2020 | 1.3 | ||
Expected rental income, during 2021 | 1.3 | ||
Expected rental income, during 2022 | 1.4 | ||
Expected rental income, during 2023 | 1.4 | ||
Expected rental income, thereafter | 2.4 | ||
Rental income from third party tenants | $ 1.2 | 1.5 | $ 1.7 |
Latham, New York | |||
Property, Plant and Equipment [Line Items] | |||
Payment for construction to expand building | 2.1 | ||
Payment to acquire building | 2.9 | ||
Yarmouth, Maine | |||
Property, Plant and Equipment [Line Items] | |||
Payment for construction to expand building | $ 19.4 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Summary of Other Intangible Assets and Related Accumulated Amortization (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Acquisition intangibles, gross | $ 461,234 | $ 374,384 |
Accumulated amortization | (184,382) | (144,767) |
Total intangibles, net | 276,852 | 229,617 |
Customer related intangibles | ||
Finite-Lived Intangible Assets [Line Items] | ||
Acquisition intangibles, gross | 238,219 | 179,789 |
Accumulated amortization | (78,120) | (63,274) |
Acquired software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Acquisition intangibles, gross | 202,416 | 179,466 |
Accumulated amortization | (99,772) | (76,800) |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Acquisition intangibles, gross | 16,905 | 11,435 |
Accumulated amortization | (5,139) | (3,768) |
Leases acquired | ||
Finite-Lived Intangible Assets [Line Items] | ||
Acquisition intangibles, gross | 3,694 | 3,694 |
Accumulated amortization | $ (1,351) | $ (925) |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Summary of Allocation of Acquisition Intangible Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Acquired Finite Lived Intangible Assets [Line Items] | |||
Goodwill | $ 753,718 | $ 657,987 | $ 650,237 |
Amortizable intangibles, Gross carrying amount | 461,234 | 374,384 | |
Amortizable intangibles, Accumulated Amortization | 184,382 | 144,767 | |
Customer related intangibles | |||
Acquired Finite Lived Intangible Assets [Line Items] | |||
Amortizable intangibles, Gross carrying amount | $ 238,219 | $ 179,789 | |
Amortizable intangibles, Weighted Average Amortization Period | 15 years | 15 years | |
Amortizable intangibles, Accumulated Amortization | $ 78,120 | $ 63,274 | |
Acquired software | |||
Acquired Finite Lived Intangible Assets [Line Items] | |||
Amortizable intangibles, Gross carrying amount | $ 202,416 | $ 179,466 | |
Amortizable intangibles, Weighted Average Amortization Period | 7 years | 7 years | |
Amortizable intangibles, Accumulated Amortization | $ 99,772 | $ 76,800 | |
Trade name | |||
Acquired Finite Lived Intangible Assets [Line Items] | |||
Amortizable intangibles, Gross carrying amount | $ 16,905 | $ 11,435 | |
Amortizable intangibles, Weighted Average Amortization Period | 11 years | 11 years | |
Amortizable intangibles, Accumulated Amortization | $ 5,139 | $ 3,768 | |
Leases acquired | |||
Acquired Finite Lived Intangible Assets [Line Items] | |||
Amortizable intangibles, Gross carrying amount | $ 3,694 | $ 3,694 | |
Amortizable intangibles, Weighted Average Amortization Period | 10 years | 10 years | |
Amortizable intangibles, Accumulated Amortization | $ 1,351 | $ 925 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Summary of Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill [Roll Forward] | ||
Goodwill Beginning Balance | $ 657,987 | $ 650,237 |
Goodwill acquired | 7,750 | |
Goodwill Ending Balance | 753,718 | 657,987 |
Socrata, Inc. | ||
Goodwill [Roll Forward] | ||
Goodwill acquired | 75,657 | |
Other acquisitions | ||
Goodwill [Roll Forward] | ||
Goodwill acquired | 20,074 | |
Enterprise Software | ||
Goodwill [Roll Forward] | ||
Goodwill Beginning Balance | 651,430 | 643,680 |
Goodwill acquired | 7,750 | |
Goodwill Ending Balance | 747,161 | 651,430 |
Enterprise Software | Socrata, Inc. | ||
Goodwill [Roll Forward] | ||
Goodwill acquired | 75,657 | |
Enterprise Software | Other acquisitions | ||
Goodwill [Roll Forward] | ||
Goodwill acquired | 20,074 | |
Appraisal and Tax | ||
Goodwill [Roll Forward] | ||
Goodwill Beginning Balance | 6,557 | 6,557 |
Goodwill acquired | 0 | |
Goodwill Ending Balance | 6,557 | $ 6,557 |
Appraisal and Tax | Socrata, Inc. | ||
Goodwill [Roll Forward] | ||
Goodwill acquired | 0 | |
Appraisal and Tax | Other acquisitions | ||
Goodwill [Roll Forward] | ||
Goodwill acquired | $ 0 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization expense | $ 39,600 | $ 35,500 | $ 35,900 |
Amortization expense, 2019 | 40,222 | ||
Amortization expense, 2020 | 38,820 | ||
Amortization expense, 2021 | 38,463 | ||
Amortization expense, 2022 | 34,987 | ||
Amortization expense, 2023 | 16,990 | ||
Amortization expense, thereafter | 105,028 | ||
Leases acquired | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense, 2019 | 372 | ||
Amortization expense, 2020 | 313 | ||
Amortization expense, 2021 | 312 | ||
Amortization expense, 2022 | 312 | ||
Amortization expense, 2023 | 312 | ||
Amortization expense, thereafter | $ 723 |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets - Summary of Estimated Annual Amortization Expense (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,019 | $ 40,222 |
2,020 | 38,820 |
2,021 | 38,463 |
2,022 | 34,987 |
2,023 | 16,990 |
Thereafter | $ 105,028 |
Accrued Liabilities - Summary o
Accrued Liabilities - Summary of Accrued Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Accrued Liabilities, Current [Abstract] | ||
Accrued wages, bonuses and commissions | $ 40,100 | $ 43,688 |
Other accrued liabilities | 26,380 | 20,987 |
Accrued liabilities | $ 66,480 | $ 64,675 |
Revolving Line of Credit - Addi
Revolving Line of Credit - Additional Information (Detail) | Nov. 16, 2015USD ($) | Dec. 31, 2018USD ($)letters_of_credit | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Line Of Credit Facility [Line Items] | ||||
Outstanding borrowings | $ 0 | $ 0 | ||
Number of outstanding letter of credit | letters_of_credit | 0 | |||
Credit Agreement | ||||
Line Of Credit Facility [Line Items] | ||||
Interest paid | $ 770,000 | $ 804,000 | $ 1,900,000 | |
Revolving Credit Facility | Credit Agreement | ||||
Line Of Credit Facility [Line Items] | ||||
Revolving credit facility, maximum borrowing capacity | $ 300,000,000 | |||
Revolving line of credit maturity date | Nov. 16, 2020 | |||
Debt instrument, interest rate, stated percentage | 5.75% | |||
Outstanding borrowings | $ 0 | |||
Line of credit facility, unused borrowing capacity | $ 300,000,000 | |||
Revolving Credit Facility | Credit Agreement | LIBOR Rate | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument, interest rate, effective percentage | 3.77% | |||
Revolving Credit Facility | Credit Agreement | Minimum | Prime Commercial Lending Rate | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit facility interest rate | 0.25% | |||
Revolving Credit Facility | Credit Agreement | Minimum | LIBOR Rate | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit facility interest rate | 1.25% | |||
Revolving Credit Facility | Credit Agreement | Maximum | Prime Commercial Lending Rate | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit facility interest rate | 1.00% | |||
Revolving Credit Facility | Credit Agreement | Maximum | LIBOR Rate | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit facility interest rate | 2.00% | |||
Letter of Credit | Revolving Credit Facility | Credit Agreement | ||||
Line Of Credit Facility [Line Items] | ||||
Revolving credit facility, maximum borrowing capacity | $ 10,000,000 |
Income Tax - Income Tax Provisi
Income Tax - Income Tax Provision (Benefit) on Income From Operations (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Federal | $ 9,110 | $ 22,883 | $ 41,366 |
State | 4,367 | 4,666 | 7,023 |
Current income tax expense benefit | 13,477 | 27,549 | 48,389 |
Deferred | (5,069) | (33,664) | (26,432) |
Income tax expense benefit | $ 8,408 | $ (6,115) | $ 21,957 |
Income Tax - Reconciliation of
Income Tax - Reconciliation of U.S. Statutory Income Tax Rate to Effective Income Tax Rate (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Federal income tax expense at statutory rate | $ 32,733 | $ 57,209 | $ 47,480 |
State income tax, net of federal income tax benefit | 7,953 | 4,754 | 5,091 |
Domestic production activities deduction | 0 | (2,617) | (3,947) |
Excess tax benefits related to stock option exercises | (32,487) | (40,624) | (29,582) |
Tax Act adjustments | (1,750) | (25,992) | 0 |
Tax credits | (3,715) | (3,578) | 0 |
Non-deductible business expenses | 5,655 | 4,573 | 2,979 |
Other, net | 19 | 160 | (64) |
Income tax expense benefit | $ 8,408 | $ (6,115) | $ 21,957 |
Income Tax - Schedule of Deferr
Income Tax - Schedule of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Income Tax Disclosure [Abstract] | ||
Operating expenses not currently deductible | $ 8,989 | $ 9,714 |
Stock option and other employee benefit plans | 19,496 | 15,932 |
Loss and credit carryforwards | 17,999 | 0 |
Total deferred income tax assets | 46,484 | 25,646 |
Valuation allowance | (1,049) | 0 |
Total deferred income tax assets, net of valuation allowance | 45,435 | 25,646 |
Intangible assets | (70,752) | (60,189) |
Property and equipment | (8,455) | (5,699) |
Prepaid expenses | (4,079) | (190) |
Deferred revenue | (3,940) | (6,447) |
Total deferred income tax liabilities | (87,226) | (72,525) |
Net deferred income tax liabilities | $ (41,791) | $ (46,879) |
Income Tax - Additional Informa
Income Tax - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Loss Carryforwards [Line Items] | |||||
Tax Act adjustments | $ (1,750) | $ (25,992) | $ 0 | ||
Deferred income taxes | $ 46,879 | ||||
Loss and credit carryforwards | $ 17,999 | 0 | |||
Uncertain tax position | 0 | 0 | $ 1,929 | 0 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||||
Balance at beginning of year | 0 | ||||
Increases for tax positions related to prior years | 1,929 | ||||
Balance at end of year | 1,929 | 0 | |||
Income taxes, net of refunds | $ 6,800 | $ 36,000 | $ 30,200 | ||
Adjustments | Accounting Standards Update 2014-09 | |||||
Operating Loss Carryforwards [Line Items] | |||||
Deferred income taxes | $ 7,965 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Activities in Common Stock (Detail) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Equity [Abstract] | |||
Stock option exercises, Shares | 1,126 | 1,113 | 827 |
Purchases of common stock, Shares | (781) | (44) | (882) |
Employee stock plan purchases, Shares | 45 | 51 | 47 |
Stock option exercises | $ 74,907 | $ 49,845 | $ 23,527 |
Purchases of common stock, Amount | (150,050) | (6,613) | (112,699) |
Employee stock plan purchases, Amount | $ 8,051 | $ 7,044 | $ 6,236 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) shares in Millions | Feb. 20, 2019shares |
Subsequent Event | |
Class Of Stock [Line Items] | |
Number of shares authorized to be repurchased, shares | 2.7 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares available for grant (in shares) | 3,800,000 | |
Shares reserved for future issuance (in shares) | 22,900,000 | |
Weighted average grant date value (in dollars per share) | $ 169.24 | $ 136.51 |
Employee Stock Purchase Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares available for grant (in shares) | 749,000 | |
Shares reserved for future issuance (in shares) | 2,000,000 | |
Percentage of annual compensation participants may contribute (in percentage) | 15.00% | |
Purchase price as a percentage of closing price on the last day of the quarter for ESPP transactions (in percentage) | 85.00% | |
Stock Option Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Contractual term (in years) | 10 years | |
Unvested options to purchase (in shares) | 1,700,000 | 2,400,000 |
Total unrecognized compensation cost | $ 137.6 | |
Weighted average amortization period (in years) | 3 years | |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 3 years | |
Minimum | Stock Option Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 3 years | |
Minimum | Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 3 years | |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 6 years | |
Maximum | Stock Option Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 6 years | |
Maximum | Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 5 years |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Weighted Average Assumptions Used for Options Granted (Detail) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield (in percentage) | 0.00% | ||
Stock Option Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected life (in years) | 6 years | 6 years | 6 years |
Expected volatility (in percentage) | 26.70% | 28.10% | 29.30% |
Risk-free interest rate (in percentage) | 2.70% | 2.00% | 1.80% |
Expected forfeiture rate (in percentage) | 0.00% | 0.00% | 0.00% |
Share-Based Compensation - RSU
Share-Based Compensation - RSU and PSU Activity (Details) - Restricted stock unit and performance stock unit shares in Thousands | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Number of Shares | |
Beginning balance, shares | shares | 0 |
Granted, shares | shares | 336 |
Vested, shares | shares | 0 |
Forfeited, shares | shares | (2) |
Ending balance, shares | shares | 334 |
Weighted Average Grant Date Fair Value per Share | |
Beginning balance (dollar per share) | $ / shares | $ 0 |
Granted (dollar per share) | $ / shares | 221.29 |
Vested (dollar per share) | $ / shares | 0 |
Forfeited (dollar per share) | $ / shares | 229.75 |
Ending balance (dollar per share) | $ / shares | $ 221.25 |
Share-Based Compensation - Stoc
Share-Based Compensation - Stock Option Activity (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Number of Shares | |||
Number of Shares, Outstanding Beginning Balance, (in shares) | 4,817 | 5,156 | 5,164 |
Number of Shares, Granted, (in shares) | 432 | 824 | 846 |
Number of Shares, Exercised, (in shares) | (1,126) | (1,113) | (827) |
Number of Shares, Forfeited, (in shares) | (31) | (50) | (27) |
Number of Shares, Outstanding Ending Balance, (in shares) | 4,092 | 4,817 | 5,156 |
Number of Shares, Exercisable at December 31, (in shares) | 2,357 | ||
Weighted Average Exercise Price | |||
Weighted Average Exercise Price, Outstanding (in dollar per share) | $ 107.91 | $ 83.64 | $ 64.43 |
Weighted Average Exercise Price, Granted (in dollars per share) | 208.21 | 176.26 | 147.25 |
Weighted Average Exercise Price, Exercised (in dollars per share) | 66.53 | 44.80 | 28.43 |
Weighted Average Exercise Price, Forfeited (in dollars per share) | 158.80 | 134.83 | 95.33 |
Weighted Average Exercise Price, Outstanding (in dollars per share) | 129.51 | $ 107.91 | $ 83.64 |
Weighted Average Exercise Price, Exercisable at End of the Period (in dollars per share) | $ 100.41 | ||
Weighted Average Remaining Contractual Life (Years), Outstanding at Period End | 7 years | ||
Weighted Average Remaining Contractual Life (Years), Exercisable at Period End | 6 years | ||
Aggregate Intrinsic Value, Outstanding at December 31 | $ 240,069 | ||
Aggregate Intrinsic Value, Exercisable at December 31 | $ 201,349 |
Share-Based Compensation - Othe
Share-Based Compensation - Other Information Pertaining to Option Activity (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Weighted average grant-date fair value of stock options granted (in dollars per share) | $ 66.52 | $ 55.56 | $ 46.89 |
Total intrinsic value of stock options exercised | $ 176,716 | $ 137,699 | $ 103,703 |
Share-Based Compensation - Su_2
Share-Based Compensation - Summary of Share-Based Compensation Expense Related to Share-Based Awards (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | $ 52,740 | $ 37,348 | $ 29,747 |
Tax benefit | (32,487) | (40,624) | (30,059) |
Net (increase) decrease in net income | 20,253 | (3,276) | (312) |
Cost of software services, maintenance and subscriptions | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 13,588 | 9,415 | 6,548 |
Selling, general and administrative expenses | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | $ 39,152 | $ 27,933 | $ 23,199 |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic Earnings and Diluted Earnings Per Share Data (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |||||||||||
Net income | $ 31,552 | $ 38,924 | $ 39,161 | $ 37,825 | $ 66,196 | $ 38,836 | $ 31,770 | $ 32,769 | $ 147,462 | $ 169,571 | $ 113,701 |
Weighted-average basic common shares outstanding | 38,445 | 37,273 | 36,448 | ||||||||
Stock options | 1,678 | 1,973 | 2,513 | ||||||||
Denominator for diluted earnings per share - Adjusted weighted-average shares | 39,891 | 40,528 | 40,224 | 39,836 | 39,499 | 39,342 | 39,201 | 38,932 | 40,123 | 39,246 | 38,961 |
Basic (USD per share) | $ 3.84 | $ 4.55 | $ 3.12 | ||||||||
Diluted (USD per share) | $ 0.79 | $ 0.96 | $ 0.97 | $ 0.95 | $ 1.68 | $ 0.99 | $ 0.81 | $ 0.84 | $ 3.68 | $ 4.32 | $ 2.92 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |||
Antidilutive securities excluded from computation of earnings per share, amount | 888 | 1,343 | 786 |
Leases - Additional Information
Leases - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Leased Assets [Line Items] | |||
Operating lease expiration year | 2,026 | ||
Rent expense | $ 8,000,000 | $ 6,900,000 | $ 6,700,000 |
Related Party Transaction | |||
Operating Leased Assets [Line Items] | |||
Rent expense | $ 0 | $ 150,000 | $ 330,000 |
Leases - Summary of Future Mini
Leases - Summary of Future Minimum Lease Payments (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
2,019 | $ 5,994 |
2,020 | 5,146 |
2,021 | 3,976 |
2,022 | 1,925 |
2,023 | 1,164 |
Thereafter | 2,132 |
Total | $ 20,337 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Percentage of employee contribution | 30.00% | ||
Defined contribution plan, cost recognized | $ 9.3 | $ 7.9 | $ 6.9 |
Maximum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Percentage of employer contribution | 3.00% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | Dec. 31, 2018LegalMatter |
Commitments and Contingencies Disclosure [Abstract] | |
Number of material legal proceedings pending | 0 |
Segment and Related Informati_3
Segment and Related Information - Additional Information (Detail) $ in Millions | 12 Months Ended | |
Dec. 31, 2018USD ($)Business_Unit | Dec. 31, 2017USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of business units | Business_Unit | 5 | |
Payment for construction to expand building | $ 2.2 | |
Enterprise Software | ||
Segment Reporting Information [Line Items] | ||
Payment for construction to expand building | $ 24.4 |
Segment and Related Informati_4
Segment and Related Information - Schedule of Segment Revenues and Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenue | $ 241,981 | $ 236,067 | $ 236,060 | $ 221,174 | $ 217,701 | $ 214,706 | $ 208,763 | $ 199,729 | $ 935,282 | $ 840,899 | $ 759,880 |
Depreciation and amortization expense | 61,759 | 53,395 | 49,773 | ||||||||
Total segment operating income | 152,492 | 162,758 | 137,656 | ||||||||
Capital expenditures | 25,132 | 45,618 | 36,723 | ||||||||
Total assets | 1,790,963 | 1,611,351 | 1,790,963 | 1,611,351 | 1,378,503 | ||||||
Operating segments | Enterprise Software | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 853,200 | 765,133 | 689,739 | ||||||||
Depreciation and amortization expense | 50,130 | 43,987 | 43,434 | ||||||||
Total segment operating income | 237,159 | 229,001 | 196,054 | ||||||||
Capital expenditures | 13,973 | 28,096 | 23,843 | ||||||||
Total assets | 556,100 | 365,736 | 556,100 | 365,736 | 321,886 | ||||||
Operating segments | Appraisal and Tax | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 90,356 | 81,579 | 73,868 | ||||||||
Depreciation and amortization expense | 914 | 760 | 984 | ||||||||
Total segment operating income | 23,094 | 20,788 | 18,871 | ||||||||
Capital expenditures | 782 | 1,181 | 1,432 | ||||||||
Total assets | 63,670 | 46,279 | 63,670 | 46,279 | 33,005 | ||||||
Corporate and Elimination | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | (8,274) | (5,813) | (3,727) | ||||||||
Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Depreciation and amortization expense | 10,715 | 8,648 | 5,355 | ||||||||
Total segment operating income | (68,572) | (51,964) | (41,832) | ||||||||
Capital expenditures | 10,377 | 16,341 | 11,448 | ||||||||
Total assets | $ 1,171,193 | $ 1,199,336 | 1,171,193 | 1,199,336 | 1,023,612 | ||||||
Intercompany | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | (13,155) | (10,425) | (6,742) | ||||||||
Intercompany | Enterprise Software | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 13,155 | 10,425 | 6,742 | ||||||||
Intercompany | Appraisal and Tax | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 0 | 0 | 0 | ||||||||
Operating Segments And Corporate Non Segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total segment operating income | 191,681 | 197,825 | 173,093 | ||||||||
Software licenses and royalties | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 93,441 | 86,242 | 83,733 | ||||||||
Software licenses and royalties | Enterprise Software | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 83,735 | 78,388 | 78,271 | ||||||||
Software licenses and royalties | Appraisal and Tax | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 9,706 | 7,854 | 5,462 | ||||||||
Software licenses and royalties | Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 0 | 0 | 0 | ||||||||
Subscriptions | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 220,547 | 172,176 | 142,657 | ||||||||
Subscriptions | Enterprise Software | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 210,740 | 164,317 | 135,469 | ||||||||
Subscriptions | Appraisal and Tax | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 9,807 | 7,859 | 7,188 | ||||||||
Subscriptions | Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 0 | 0 | 0 | ||||||||
Software services | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 191,269 | 180,460 | 171,648 | ||||||||
Software services | Enterprise Software | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 166,921 | 161,245 | 155,322 | ||||||||
Software services | Appraisal and Tax | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 24,348 | 19,215 | 16,326 | ||||||||
Software services | Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 0 | 0 | 0 | ||||||||
Maintenance | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 384,521 | 359,319 | 320,998 | ||||||||
Maintenance | Enterprise Software | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 359,904 | 337,701 | 302,409 | ||||||||
Maintenance | Appraisal and Tax | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 24,617 | 21,618 | 18,589 | ||||||||
Maintenance | Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 0 | 0 | 0 | ||||||||
Appraisal services | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 21,846 | 25,023 | 26,287 | ||||||||
Appraisal services | Enterprise Software | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 0 | 0 | 0 | ||||||||
Appraisal services | Appraisal and Tax | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 21,846 | 25,023 | 26,287 | ||||||||
Appraisal services | Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 0 | 0 | 0 | ||||||||
Hardware and other | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 23,658 | 17,679 | 14,557 | ||||||||
Hardware and other | Enterprise Software | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 18,745 | 13,057 | 11,526 | ||||||||
Hardware and other | Appraisal and Tax | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 32 | 10 | 16 | ||||||||
Hardware and other | Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | $ 4,881 | $ 4,612 | $ 3,015 |
Segment and Related Informati_5
Segment and Related Information - Reconciliation of Operating Income from Segments to Consolidated (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Total segment operating income | $ 152,492 | $ 162,758 | $ 137,656 |
Amortization of customer and trade name intangibles | (39,600) | (35,500) | (35,900) |
Other income (expense), net | 3,378 | 698 | (1,998) |
Income before income taxes | 155,870 | 163,456 | 135,658 |
Operating Segments And Corporate Non Segment | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Total segment operating income | 191,681 | 197,825 | 173,093 |
Segment Reconciling Items | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Amortization of acquired software | (22,972) | (21,686) | (22,235) |
Amortization of customer and trade name intangibles | (16,217) | (13,381) | (13,202) |
Other income (expense), net | $ 3,378 | $ 698 | $ (1,998) |
Disaggregation of Revenue (Deta
Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | $ 241,981 | $ 236,067 | $ 236,060 | $ 221,174 | $ 217,701 | $ 214,706 | $ 208,763 | $ 199,729 | $ 935,282 | $ 840,899 | $ 759,880 | |
Operating segments | Enterprise Software | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 853,200 | 765,133 | 689,739 | |||||||||
Operating segments | Appraisal and Tax | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 90,356 | 81,579 | 73,868 | |||||||||
Intercompany | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | (13,155) | (10,425) | (6,742) | |||||||||
Intercompany | Enterprise Software | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 13,155 | 10,425 | 6,742 | |||||||||
Intercompany | Appraisal and Tax | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | 0 | |||||||||
Corporate and Elimination | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | (8,274) | (5,813) | (3,727) | |||||||||
Recurring revenues | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 605,069 | 531,495 | ||||||||||
Recurring revenues | Enterprise Software | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 570,645 | 502,018 | ||||||||||
Recurring revenues | Appraisal and Tax | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 34,424 | 29,477 | ||||||||||
Recurring revenues | Corporate | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | ||||||||||
Non-recurring revenues | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 330,213 | 309,404 | ||||||||||
Non-recurring revenues | Enterprise Software | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 269,400 | 252,690 | ||||||||||
Non-recurring revenues | Appraisal and Tax | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 55,932 | 52,102 | ||||||||||
Non-recurring revenues | Corporate | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | $ 4,881 | 4,612 | ||||||||||
Minimum | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Contract term (in years) | 1 year | |||||||||||
Typical contract term (in years) | 3 years | 3 years | ||||||||||
Maximum | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Contract term (in years) | 10 years | |||||||||||
Typical contract term (in years) | 5 years | 5 years | ||||||||||
Products and services transferred at a point in time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | $ 98,846 | 86,846 | ||||||||||
Products and services transferred over time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 836,436 | 754,053 | ||||||||||
Software licenses and royalties | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 93,441 | 86,242 | 83,733 | |||||||||
Software licenses and royalties | Enterprise Software | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 83,735 | 78,388 | 78,271 | |||||||||
Software licenses and royalties | Appraisal and Tax | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 9,706 | 7,854 | 5,462 | |||||||||
Software licenses and royalties | Corporate | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | 0 | |||||||||
Software licenses and royalties | Products and services transferred at a point in time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 75,188 | 69,167 | ||||||||||
Software licenses and royalties | Products and services transferred over time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 18,253 | 17,075 | ||||||||||
Subscriptions | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 220,547 | 172,176 | 142,657 | |||||||||
Subscriptions | Enterprise Software | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 210,740 | 164,317 | 135,469 | |||||||||
Subscriptions | Appraisal and Tax | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 9,807 | 7,859 | 7,188 | |||||||||
Subscriptions | Corporate | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | 0 | |||||||||
Subscriptions | Products and services transferred at a point in time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | ||||||||||
Subscriptions | Products and services transferred over time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 220,547 | 172,176 | ||||||||||
Software services | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 191,269 | 180,460 | 171,648 | |||||||||
Software services | Enterprise Software | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 166,921 | 161,245 | 155,322 | |||||||||
Software services | Appraisal and Tax | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 24,348 | 19,215 | 16,326 | |||||||||
Software services | Corporate | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | 0 | |||||||||
Software services | Products and services transferred at a point in time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | ||||||||||
Software services | Products and services transferred over time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 191,269 | 180,460 | ||||||||||
Maintenance | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 384,521 | 359,319 | 320,998 | |||||||||
Maintenance | Enterprise Software | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 359,904 | 337,701 | 302,409 | |||||||||
Maintenance | Appraisal and Tax | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 24,617 | 21,618 | 18,589 | |||||||||
Maintenance | Corporate | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | 0 | |||||||||
Maintenance | Products and services transferred at a point in time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | ||||||||||
Maintenance | Products and services transferred over time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 384,521 | 359,319 | ||||||||||
Appraisal services | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 21,846 | 25,023 | 26,287 | |||||||||
Appraisal services | Enterprise Software | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | 0 | |||||||||
Appraisal services | Appraisal and Tax | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 21,846 | 25,023 | 26,287 | |||||||||
Appraisal services | Corporate | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | $ 0 | |||||||||
Appraisal services | Minimum | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Contract term (in years) | 1 year | |||||||||||
Appraisal services | Maximum | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Contract term (in years) | 3 years | |||||||||||
Appraisal services | Products and services transferred at a point in time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 0 | 0 | ||||||||||
Appraisal services | Products and services transferred over time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 21,846 | 25,023 | ||||||||||
Hardware and other | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 23,658 | 17,679 | ||||||||||
Hardware and other | Products and services transferred at a point in time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 23,658 | 17,679 | ||||||||||
Hardware and other | Products and services transferred over time | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | $ 0 | $ 0 |
Deferred Revenue and Performa_3
Deferred Revenue and Performance Obligations - Deferred Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Jan. 01, 2017 | |
Disaggregation of Revenue [Line Items] | ||
Deferred revenue | $ 299,887 | $ 290,100 |
Contract With Customer Liability [Roll Forward] | ||
Balance, beginning of period December 31, 2017 (As Adjusted) | 299,887 | |
Deferral of revenue | 871,498 | |
Recognition of deferred revenue | (820,449) | |
Balance, end of period | 350,936 | |
Operating segments | Enterprise Software | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue | 277,198 | |
Contract With Customer Liability [Roll Forward] | ||
Balance, beginning of period December 31, 2017 (As Adjusted) | 277,198 | |
Balance, end of period | 327,521 | |
Operating segments | Appraisal and Tax | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue | 20,387 | |
Contract With Customer Liability [Roll Forward] | ||
Balance, beginning of period December 31, 2017 (As Adjusted) | 20,387 | |
Balance, end of period | 20,018 | |
Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue | 2,302 | |
Contract With Customer Liability [Roll Forward] | ||
Balance, beginning of period December 31, 2017 (As Adjusted) | 2,302 | |
Balance, end of period | $ 3,397 |
Deferred Revenue and Performa_4
Deferred Revenue and Performance Obligations - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2017 |
Revenue from Contract with Customer [Abstract] | |||
Remaining performance obligations | $ 1,250,000 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Deferred revenue | $ 350,936 | $ 299,887 | $ 290,100 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Revenue, remaining performance obligation, percentage | 50.00% | ||
Expected timing of satisfaction period | 1 year |
Deferred Commissions (Details)
Deferred Commissions (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Capitalized Contract Cost [Line Items] | |||
Deferred commissions | $ 21.9 | $ 19.3 | |
Deferred commissions amortization | $ 15.6 | $ 11.2 | |
Minimum | |||
Capitalized Contract Cost [Line Items] | |||
Sales commissions amortization period (in years) | 3 years | 3 years | 1 year |
Maximum | |||
Capitalized Contract Cost [Line Items] | |||
Sales commissions amortization period (in years) | 7 years | 7 years | 2 years |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event - USD ($) $ in Thousands | Feb. 01, 2019 | Jan. 31, 2019 |
MicroPact | ||
Subsequent Event [Line Items] | ||
Total purchase price to acquire business | $ 185,000 | |
Additional merger consideration | $ 10,000 | |
Civic LLC | ||
Subsequent Event [Line Items] | ||
Total purchase price to acquire business | $ 3,700 | |
Cash to acquire business | 3,600 | |
Accrued purchase price | $ 90 |
Quarterly Financial Informati_3
Quarterly Financial Information (unaudited) - Summary of Selected Financial Information (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 241,981 | $ 236,067 | $ 236,060 | $ 221,174 | $ 217,701 | $ 214,706 | $ 208,763 | $ 199,729 | $ 935,282 | $ 840,899 | $ 759,880 |
Gross profit | 115,871 | 111,626 | 109,276 | 102,805 | 105,350 | 103,989 | 95,503 | 94,535 | 439,578 | 399,377 | 359,188 |
Income before income taxes | 40,107 | 38,626 | 37,700 | 39,437 | 45,261 | 44,357 | 37,197 | 36,641 | |||
Net income | $ 31,552 | $ 38,924 | $ 39,161 | $ 37,825 | $ 66,196 | $ 38,836 | $ 31,770 | $ 32,769 | $ 147,462 | $ 169,571 | $ 113,701 |
Diluted (USD per share) | $ 0.79 | $ 0.96 | $ 0.97 | $ 0.95 | $ 1.68 | $ 0.99 | $ 0.81 | $ 0.84 | $ 3.68 | $ 4.32 | $ 2.92 |
Shares used in computing diluted earnings per share | 39,891 | 40,528 | 40,224 | 39,836 | 39,499 | 39,342 | 39,201 | 38,932 | 40,123 | 39,246 | 38,961 |
Tax Act tax benefit | $ 1,750 | $ 25,992 | $ 0 |