Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Oct. 30, 2019 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | SMSI | |
Entity Registrant Name | SMITH MICRO SOFTWARE, INC. | |
Entity Central Index Key | 0000948708 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 38,502,511 | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity File Number | 001-35525 | |
Entity Tax Identification Number | 33-0029027 | |
Entity Address, Address Line One | 5800 CORPORATE DRIVE | |
Entity Address, City or Town | PITTSBURGH | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 15237 | |
City Area Code | 412 | |
Local Phone Number | 837-5300 | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Security Exchange Name | NASDAQ | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Incorporation, State or Country Code | DE |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 23,870 | $ 12,159 |
Accounts receivable, net of allowances for doubtful accounts and other adjustments of $244 (2019) and $135 (2018) | 11,087 | 7,130 |
Prepaid expenses and other current assets | 763 | 795 |
Total current assets | 35,720 | 20,084 |
Equipment and improvements, net | 1,392 | 865 |
Right-of-use assets | 6,459 | |
Deferred tax assets, net | 191 | 191 |
Other assets | 239 | 140 |
Intangible assets, net | 4,761 | 238 |
Goodwill | 7,797 | 3,685 |
Total assets | 56,559 | 25,203 |
Current liabilities: | ||
Accounts payable | 1,536 | 1,160 |
Accrued payroll and benefits | 2,128 | 1,745 |
Current operating lease liabilities | 1,154 | |
Other accrued liabilities | 212 | 450 |
Deferred revenue | 105 | 28 |
Total current liabilities | 5,135 | 3,383 |
Non-current liabilities: | ||
Operating lease liabilities | 5,809 | |
Deferred rent | 677 | 723 |
Other long term liabilities | 151 | 534 |
Total non-current liabilities | 6,637 | 1,257 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, par value $0.001 per share; 5,000,000 shares authorized; 5,500 shares issued (2019 and 2018); 0 and 1,345 shares outstanding (2019 and 2018, respectively) | ||
Common stock, par value $0.001 per share; 100,000,000 shares authorized; 38,487,090 and 28,241,129 shares issued and outstanding (2019 and 2018, respectively) | 38 | 28 |
Additional paid-in capital | 273,815 | 256,626 |
Accumulated comprehensive deficit | (229,066) | (236,091) |
Total stockholders’ equity | 44,787 | 20,563 |
Total liabilities and stockholders' equity | $ 56,559 | $ 25,203 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Allowances for doubtful accounts receivable | $ 244 | $ 135 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 5,500 | 5,500 |
Preferred stock, shares outstanding | 0 | 1,345 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 38,487,090 | 28,241,129 |
Common stock, shares outstanding | 38,487,090 | 28,241,129 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
Revenues | $ 11,782 | $ 6,525 | $ 31,068 | $ 18,933 |
Cost of revenues | 1,011 | 979 | 2,902 | 3,404 |
Gross profit | 10,771 | 5,546 | 28,166 | 15,529 |
Operating expenses: | ||||
Selling and marketing | 1,793 | 1,311 | 5,529 | 4,488 |
Research and development | 3,063 | 2,049 | 8,487 | 6,499 |
General and administrative | 2,396 | 2,048 | 7,522 | 6,299 |
Restructuring expense | 39 | 83 | 154 | 135 |
Total operating expenses | 7,291 | 5,491 | 21,692 | 17,421 |
Operating income (loss) | 3,480 | 55 | 6,474 | (1,892) |
Other income (expense): | ||||
Interest income (expense), net | 87 | (128) | 117 | (445) |
Change in fair value of warrant liability | (902) | (3,126) | ||
Gain on sale of software product | 483 | |||
Other expense | (1) | (15) | (48) | |
Income (loss) before provision for income taxes | 3,567 | (976) | 7,059 | (5,511) |
Provision for income tax expense | 7 | 8 | 30 | |
Net income (loss) | $ 3,567 | $ (983) | $ 7,051 | $ (5,541) |
Net earnings (loss) per share: | ||||
Basic | $ 0.10 | $ (0.04) | $ 0.21 | $ (0.28) |
Diluted | $ 0.09 | $ (0.04) | $ 0.20 | $ (0.28) |
Weighted average shares outstanding: | ||||
Basic | 36,094 | 25,020 | 33,170 | 20,771 |
Diluted | 39,472 | 25,020 | 35,287 | 20,771 |
Preferred dividends per share | $ 70.50 | $ 31.58 | $ 104.58 | $ 105.54 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Preferred Stock [Member]Series B Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Comprehensive Deficit [Member] |
BALANCE at Dec. 31, 2017 | $ 4,567 | $ 14 | $ 237,486 | $ (232,933) | |
BALANCE, Shares at Dec. 31, 2017 | 5,000 | ||||
BALANCE, Shares at Dec. 31, 2017 | 14,269,000 | ||||
Non-cash compensation recognized on stock options and ESPP | 31 | 31 | |||
Restricted stock grants, net of cancellations | 643 | $ 1 | 642 | ||
Restricted stock grants, net of cancellations, shares | 1,124,000 | ||||
Cancellation of shares for payment of withholding tax | (151) | (151) | |||
Cancellation of shares for payment of withholding tax, shares | (68,000) | ||||
Employee stock purchase plan | 5 | 5 | |||
Employee stock purchase plan, shares | 5,000 | ||||
Common shares issued in stock offering, net of offering costs | 10,748 | $ 6 | 10,742 | ||
Common shares issued in stock offering, net offering costs, shares | 6,027,000 | ||||
Issuance of warrants in stock offering | (6,792) | (6,792) | |||
Exercise of warrants, shares | 25,000 | ||||
Conversion of preferred stock to common stock | $ 4 | (4) | |||
Conversion of preferred stock to common stock, shares | (4,000) | 3,623,000 | |||
Preferred stock dividends | (370) | (370) | |||
Other | (1) | 11 | (12) | ||
Comprehensive loss | (5,542) | (5,542) | |||
BALANCE at Sep. 30, 2018 | 3,138 | $ 25 | 241,970 | (238,857) | |
BALANCE, Shares at Sep. 30, 2018 | 1,000 | ||||
BALANCE, Shares at Sep. 30, 2018 | 25,005,000 | ||||
BALANCE at Jun. 30, 2018 | 3,984 | $ 25 | 241,790 | (237,831) | |
BALANCE, Shares at Jun. 30, 2018 | 1,000 | ||||
BALANCE, Shares at Jun. 30, 2018 | 25,004,000 | ||||
Non-cash compensation recognized on stock options and ESPP | 10 | 10 | |||
Restricted stock grants, net of cancellations | 254 | 254 | |||
Cancellation of shares for payment of withholding tax | (64) | (64) | |||
Cancellation of shares for payment of withholding tax, shares | (26,000) | ||||
Employee stock purchase plan | 2 | 2 | |||
Employee stock purchase plan, shares | 2,000 | ||||
Common shares issued in stock offering, net of offering costs | (10) | (10) | |||
Issuance of warrants in stock offering | (12) | (12) | |||
Exercise of warrants, shares | 25,000 | ||||
Preferred stock dividends | (43) | (43) | |||
Comprehensive loss | (983) | (983) | |||
BALANCE at Sep. 30, 2018 | 3,138 | $ 25 | 241,970 | (238,857) | |
BALANCE, Shares at Sep. 30, 2018 | 1,000 | ||||
BALANCE, Shares at Sep. 30, 2018 | 25,005,000 | ||||
BALANCE at Dec. 31, 2018 | $ 20,563 | $ 28 | 256,626 | (236,091) | |
BALANCE, Shares at Dec. 31, 2018 | 5,500 | 1,000 | |||
BALANCE, Shares at Dec. 31, 2018 | 28,241,129 | 28,242,000 | |||
Non-cash compensation recognized on stock options and ESPP | $ 30 | 30 | |||
Restricted stock grants, net of cancellations | 1,109 | $ 1 | 1,108 | ||
Restricted stock grants, net of cancellations, shares | 1,225,000 | ||||
Cancellation of shares for payment of withholding tax | (506) | (506) | |||
Cancellation of shares for payment of withholding tax, shares | (176,000) | ||||
Employee stock purchase plan | 10 | 10 | |||
Employee stock purchase plan, shares | 4,000 | ||||
Common shares issued in stock offering, net of offering costs | (14) | (14) | |||
Common shares issued in connection with Smart Retail acquisition, net | 5,129 | $ 3 | 5,126 | ||
Common shares issued in connection, with Smart Retail acquisition, net, shares | 2,699,000 | ||||
Exercise of warrants | 11,403 | $ 5 | 11,398 | ||
Exercise of warrants, shares | 5,304,000 | ||||
Exercise of stock options | 38 | 38 | |||
Exercise of stock options, shares | 10,000 | ||||
Conversion of preferred stock to common stock | $ 1 | (1) | |||
Conversion of preferred stock to common stock, shares | (1,000) | 1,180,000 | |||
Preferred stock dividends | (119) | (119) | |||
Cumulative effect of adoption of ASC 842 | 93 | 93 | |||
Comprehensive loss | 7,051 | 7,051 | |||
BALANCE at Sep. 30, 2019 | $ 44,787 | $ 38 | 273,815 | (229,066) | |
BALANCE, Shares at Sep. 30, 2019 | 5,500 | ||||
BALANCE, Shares at Sep. 30, 2019 | 38,487,090 | 38,488,000 | |||
BALANCE at Jun. 30, 2019 | $ 29,666 | $ 32 | 262,215 | (232,581) | |
BALANCE, Shares at Jun. 30, 2019 | 1,000 | ||||
BALANCE, Shares at Jun. 30, 2019 | 32,042,000 | ||||
Non-cash compensation recognized on stock options and ESPP | 10 | 10 | |||
Restricted stock grants, net of cancellations | 340 | 340 | |||
Cancellation of shares for payment of withholding tax | (191) | (191) | |||
Cancellation of shares for payment of withholding tax, shares | (38,000) | ||||
Employee stock purchase plan | 6 | 6 | |||
Employee stock purchase plan, shares | 2,000 | ||||
Exercise of warrants | 11,403 | $ 5 | 11,398 | ||
Exercise of warrants, shares | 5,301,000 | ||||
Exercise of stock options | 38 | 38 | |||
Exercise of stock options, shares | 10,000 | ||||
Conversion of preferred stock to common stock | $ 1 | (1) | |||
Conversion of preferred stock to common stock, shares | (1,000) | 1,171,000 | |||
Preferred stock dividends | (52) | (52) | |||
Comprehensive loss | 3,567 | 3,567 | |||
BALANCE at Sep. 30, 2019 | $ 44,787 | $ 38 | $ 273,815 | $ (229,066) | |
BALANCE, Shares at Sep. 30, 2019 | 5,500 | ||||
BALANCE, Shares at Sep. 30, 2019 | 38,487,090 | 38,488,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Operating activities: | ||
Net income (loss) | $ 7,051 | $ (5,541) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 997 | 651 |
Non-cash lease expense | 730 | |
Amortization of debt discounts and financing issuance costs | 197 | |
Restructuring costs | 154 | 135 |
Provision for doubtful accounts and other adjustments to accounts receivable | 127 | 6 |
Provision for excess and obsolete inventory | 1 | (18) |
Loss on disposal of fixed assets | 6 | |
Stock based compensation | 1,139 | 674 |
Change in fair value of warrant liability | 3,126 | |
Gain on sale of software product | (483) | |
Change in operating accounts: | ||
Accounts receivable | (4,031) | (1,189) |
Prepaid expenses and other assets | 52 | (145) |
Accounts payable and accrued liabilities | (701) | (973) |
Deferred revenue | (214) | 47 |
Net cash provided by (used in) operating activities | 4,828 | (3,030) |
Investing activities: | ||
Acquisition of Smart Retail business, net | (3,974) | |
Proceeds from sale of software product | 363 | |
Capital expenditures | (824) | (172) |
Net cash used in investing activities | (4,435) | (172) |
Financing activities: | ||
Proceeds from stock sale for employee stock purchase plan | 10 | 5 |
Proceeds from (payments related to) the issuance of common stock | (14) | 10,749 |
Proceeds from exercise of common stock warrants | 11,403 | |
Proceeds from exercise of stock options | 38 | |
Repayments of short-term secured promissory notes | (1,000) | |
Dividends paid on preferred stock | (119) | (370) |
Net cash provided by financing activities | 11,318 | 9,384 |
Net increase in cash and cash equivalents | 11,711 | 6,182 |
Cash and cash equivalents, beginning of period | 12,159 | 2,205 |
Cash and cash equivalents, end of period | 23,870 | 8,387 |
Supplemental disclosures of cash flow information: | ||
Cash paid for income taxes | 60 | 4 |
Cash paid for interest expense | 334 | |
Supplemental disclosures of non-cash activities: | ||
Issuance of common stock in connection with Smart Retail acquisition | 5,129 | |
Issuance of common stock warrants in connection with stock offering | 6,792 | |
Cancellation of shares for payment of withholding tax | $ (506) | $ (151) |
The Company
The Company | 9 Months Ended |
Sep. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
The Company | 1. The Company Smith Micro Software, Inc. (“Smith Micro” or the “Company”) develops software to simplify and enhance the mobile experience, providing solutions to some of the leading wireless service providers and cable multiple service operators (“MSOs”) around the world. From enabling the family digital lifestyle to providing powerful voice messaging capabilities, our solutions enrich today’s connected lifestyles while creating new opportunities to engage consumers via smartphones and consumer internet of things (“IoT”) devices. Our portfolio also includes a wide range of products for creating, sharing and monetizing rich content, such as visual messaging, optimizing retail content display, analytics capabilities, and graphics applications. |
Accounting Policies
Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Accounting Policies | 2. Accounting Policies Basis of Presentation The accompanying interim consolidated balance sheet as of September 30, 2019, and the related consolidated statements of operations, stockholders’ equity and cash flows for each of the three and nine months ended September 30, 2019 and 2018, are unaudited. The unaudited consolidated financial statements have been prepared according to the rules and regulations of the Securities and Exchange Commission (“SEC”) and, therefore, certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted. In the opinion of management, the accompanying unaudited consolidated financial statements for the periods presented reflect all adjustments which are normal and recurring, and necessary to fairly state the financial position, results of operations, and cash flows of the Company. These unaudited consolidated financial statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018 filed with the SEC on March 27, 2019. Intercompany balances and transactions have been eliminated in consolidation. Operating results for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending December 31, 2019. Recently Adopted Accounting Pronouncements The Company adopted the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic No. 842, Leases, Revenue Recognition The Company adopted FASB ASC Topic No. 606, Revenue from Contracts with Customers, In our Wireless segment, we transfer software licenses to our customers on a royalty free, non-exclusive, non-transferrable, limited use basis during the term of the agreement. In some instances, we perform customization services to ensure the software operates within our customer’s operating platforms as well as the operating platforms of the mobile devices used by their end customers, before transferring the license. Revenue related to these services is recognized at a point in time upon acceptance of the software license by the customer. We also earn usage based revenue on our platforms. Usage based revenue is generated based on active licenses used by our customer’s end customers, the provision of hosting services, revenue share based on media placements on our platform, and use of our cloud based services. We recognize our usage based revenue when we have completed our performance obligation and have the right to invoice the customer. This revenue is generally recognized monthly or quarterly. We also provide consulting services to develop customer specified functionality that are generally not on our software development roadmap. We recognize revenue from our consulting services upon delivery and acceptance by the customer of our software enhancements and upgrades. For certain Wireless segment customers we provide maintenance and technology support services for which the customer either pays upfront or as we provide the services. When the customer pays upfront, we record the payments as contract liabilities and recognize revenue ratably over the contract period as this is our stand ready performance obligation that is satisfied ratably over the maintenance and technology services period. As discussed in Note 3, during the first quarter of 2019 we acquired the net assets of ISM Connect, LLC associated with the Smart Retail product suite, later branded ViewSpot™. Our ViewSpot contracts with Tier 1 customers include promises to provide multiple products and services. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. When a cloud-based service includes both on-premises software licenses and cloud 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 cloud service and recognized over time. Certain cloud services, primarily ViewSpot, depend on a significant level of integration, interdependency, and interrelation between the on-premise applications and cloud services, and are accounted for together as a single performance obligation. Revenue from ViewSpot is recognized ratably over the period in which the cloud services are provided. We receive upfront payments from customers from services to be provided under our ViewSpot arrangements. The advance receipts are deferred and subsequently recognized ratably over the contract period. We also provide consulting services to configure ad hoc targeted promotional content for our customers upon request. These requests are driven by our customers’ marketing initiatives and tend to be short term “bursts” of activity. We recognize these revenues upon delivery of the configured promotional content to the cloud platform. In our Graphics segment where we sell off-the-self software products with no customization or post sale technology support services, we recognize revenue at the time we transfer control of the product to the customer. This occurs upon shipment of the product or when the customer downloads the software from our website or website of our resellers. We offer a 30 day return option to our customers; a return reserve is established at the time revenue is recorded and the reserve is monitored and adjusted based on actual experience. Historically, returns have been insignificant. Fair Value Measurements The Company measures and discloses fair value measurements as required by FASB ASC Topic No. 820, Fair Value Measurements and Disclosures Fair value is an exit price, representing the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. As such, fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, the FASB establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: • Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets • Level 2 - Include other inputs that are directly or indirectly observable in the marketplace • Level 3 - Unobservable inputs which are supported by little or no market activity The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. As required by FASB ASC Topic No. 820, we measure our cash and cash equivalents at fair value. Our cash equivalents are classified within Level 1 by using quoted market prices utilizing market observable inputs. As required by FASB ASC Topic No. 820, we measured our warrant liability at fair value. Our warrant liability was classified within Level 3 as some of the inputs to our valuation model are either not observable quoted prices or are not derived principally from, or corroborated by, observable market data by correlation or other means. As required by FASB ASC Topic No. 350, for goodwill and other intangibles impairment analysis, we utilize fair value measurements which are categorized within Level 3 of the fair value hierarchy. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | 3. Acquisitions In December 2018, the Company entered into a definitive agreement to acquire the net assets of ISM Connect, LLC’s Smart Retail product suite (“Smart Retail”). The transaction closed on January 9, 2019. The following table summarizes the consideration paid for the Smart Retail acquisition in 2019 (unaudited, in thousands): Fair value of assets acquired $ 9,394 Fair value of liabilities assumed 291 Total purchase price $ 9,103 Components of purchase price: Cash $ 3,974 Common stock 5,129 Total purchase price $ 9,103 The Company’s preliminary allocation of the purchase price is summarized as follows (unaudited, in thousands): Assets: Costs incurred on projects not complete $ 53 Intangible assets 5,229 Goodwill 4,112 Total assets $ 9,394 Liabilities: Deferred revenue $ 291 Total liabilities 291 Total purchase price $ 9,103 The primary goal of the Smart Retail acquisition was to acquire a new growing and profitable revenue stream while deepening the relationships with our customers. The Smart Retail platform, which we now call ViewSpot, enables wireless carriers and retailers to offer powerful on-screen, interactive device demos that deliver consistent, secure and targeted content that showcase the features of the devices that consumers want to see and learn more about. ViewSpot also provides analytics capabilities, which allow customers to gain valuable insights into buying behaviors. The platform is a logical addition to the Company’s existing product line that reaches wireless carriers and provides them with services that can attract and retain customers. Unaudited pro forma results of operations for the three and nine months ended September 30, 2019 and 2018 are included below as if the Smart Retail acquisition occurred on January 1, 2018. This summary of the unaudited pro forma results of operations is not necessarily indicative of what the Company’s results of operations would have been had Smart Retail been acquired at the beginning of 2018, nor does it purport to represent results of operations for any future periods. For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited, in thousands, except per share amounts) (unaudited, in thousands, except per share amounts) Revenues $ 11,782 $ 7,389 $ 31,068 $ 21,621 Net income (loss) 3,567 (705 ) 7,051 (4,790 ) Earnings (loss) per share: Basic $ 0.10 $ (0.03 ) $ 0.21 $ (0.25 ) Diluted $ 0.09 $ (0.03 ) $ 0.20 $ (0.25 ) |
Going Concern Evaluation
Going Concern Evaluation | 9 Months Ended |
Sep. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Going Concern Evaluation | 4. Going Concern Evaluation In connection with preparing consolidated financial statements for the three and nine months ended September 30, 2019, management evaluated whether there were conditions and events that, when considered in the aggregate, raised substantial doubt about the Company’s ability to continue as a going concern within one year from the date that the financial statements are issued. The Company considered the historical operating loss and negative cash flow from operating activities trends, including the positive trends occurring in the recent year. Ordinarily, conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern relate to the entity’s ability to meet its obligations as they become due. The Company evaluated its ability to meet its obligations as they become due within one year from the date that the financial statements are issued by considering the following: • In May 2017, the Company raised $2.2 million of new capital in a private placement offering of its common stock. • In September 2017, the Company closed on a $5.5 million preferred stock transaction which converted $2.8 million of long and short-term debt and raised $2.7 million of new capital. • On March 5, 2018, the Company raised $5.0 million of new capital in a private placement offering of its common stock. • On May 3, 2018, the Company raised $7.0 million of new capital in a private placement offering of its common stock. • On November 7, 2018, the Company raised $7.5 million of new capital in a private placement offering of its common stock. Following this transaction, $3.2 million of short and long-term debt was repaid. • During the third quarter of 2019, the Company received over $11.0 million in cash as a result of warrant exercises. Management believes the Company will generate enough cash from operations to satisfy its obligations for the next twelve months from the issuance date. The Company will take the following actions, if it starts to trend unfavorably against its internal profitability and cash flow projections, in order to mitigate conditions or events that would raise substantial doubt about its ability to continue as a going concern: • Raise additional capital through a private placement. • Raise additional capital through short-term loans. • Implement restructuring and cost reductions. • Secure a commercial bank line of credit. • Sell or license intellectual property. |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill | 5. Goodwill In accordance with FASB ASC Topic No. 350, Intangibles-Goodwill and Other |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 6. Earnings Per Share The Company calculates earnings per share (“EPS”) as required by FASB ASC Topic No. 260, Earnings Per Share The following table sets forth the details of basic and diluted earnings per share: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited, in thousands, except per share amounts) (unaudited, in thousands, except per share amounts) Numerator: Net income (loss) $ 3,567 $ (983 ) $ 7,051 $ (5,541 ) Dividends paid to preferred stockholders (52 ) (43 ) (119 ) (370 ) Net income (loss) available to common stockholders $ 3,515 $ (1,026 ) $ 6,932 $ (5,911 ) Denominator: Weighted average shares outstanding – basic 36,094 25,020 33,170 20,771 Potential common shares – options / warrants (treasury stock method) 3,378 — 2,117 — Weighted average shares outstanding – diluted 39,472 25,020 35,287 20,771 Shares excluded (anti-dilutive) 67 126 131 1,086 Net earnings (loss) per common share: Basic $ 0.10 $ (0.04 ) $ 0.21 $ (0.28 ) Diluted $ 0.09 $ (0.04 ) $ 0.20 $ (0.28 ) |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | 7. Stock-Based Compensation Stock Plans During the three and nine months ended September 30, 2019, the Company granted 0 and 1,250,000 shares of restricted stock, and 0 and 55,000 incentive stock options, respectively, under the Company’s 2015 Omnibus Equity Incentive Plan, as amended. As of September 30, 2019, there were 1.3 million shares available for future grants under the 2015 Omnibus Equity Incentive Plan. |
Revenues
Revenues | 9 Months Ended |
Sep. 30, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Revenues | 8. Revenues Revenue Recognition We sell products and services to customers in our Wireless and Graphics segments. In our Wireless segment, we sell our software solution, cloud based services and consulting services to major wireless network and cable operators. We sell our off-the-shelf Graphics software products directly to end users as well as through our distribution and reseller channel partners. We recognize sales of goods and services based on the five-step analysis of transactions as provided in Topic 606. For all contracts with customers, we first identify the contract which usually is established when a contract is fully executed by each party and consideration is expected to be received. Next, we identify the performance obligations in the contract. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. We then determine the transaction price in the arrangement and allocate the transaction price, if necessary, to each performance obligation identified in the contract. The allocation of the transaction price to the performance obligations are based on the relative standalone selling prices for the goods and services contained in a particular performance obligation. The transaction price is adjusted for the Company’s estimate of variable consideration which may include certain incentives and discounts, product returns, distributor fees, and storage fees. We evaluate the total amount of variable consideration expected to be earned by using the expected value method, as we believe this method represents the most appropriate estimate for this consideration, based on historical service trends, the individual contract considerations and our best judgment at the time. We include estimates of variable consideration in revenues only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. We also generate the majority of our revenue on usage based fees which are variable and depend entirely on our customers use of perpetual licenses, transactions processed on our hosted environment, advertisement placements on our service platform, and activity on our cloud based service platform. During the first quarter of 2019, we acquired the Smart Retail assets from ISM Connect, LLC. Our contracts with the Tier 1 customers include promises to transfer multiple products and services. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. When a cloud based service includes both on-premises software licenses and cloud 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 cloud service and recognized over time. Certain cloud services, primarily ViewSpot, depend on a significant level of integration, interdependency, and interrelation between the on-premise applications and cloud services, and are accounted for together as one performance obligation. Revenue from ViewSpot is recognized ratably over the period in which the cloud services are provided. We receive upfront payments from customers from services to be provided under our ViewSpot arrangements. The advance receipts are deferred and subsequently recognized ratably over the contract period. We also provide consulting services to configure ad hoc targeted promotional content for our customers upon request. These requests are driven by our customer’s marketing initiatives and tend to be short term “bursts” of activity. We recognize these revenues upon delivery of the configured promotional content to the cloud platform. We have made accounting policy elections to exclude all taxes by governmental authorities from the measurement of the transaction price, and since our standard payment terms are less than one year, we have elected the practical expedient not to assess whether a contract has a significant financing component. Deferred Revenue Deferred revenue represents amounts billed to customers for which revenue has not been recognized. Deferred revenue primarily consists of the unearned portion of monthly, quarterly and annually billed service fees and prepayments made by customers for a future period. We recognize revenue upon transfer of control. During the three and nine months ended September 30, 2019, we recognized $0 and $27 thousand, respectively, in our consolidated statements of operations that was previously recorded as deferred revenue in the consolidated balance sheet at January 1, 2019. Disaggregation of Revenues We disaggregate revenue by our Wireless and Graphics segments. Revenues on a disaggregated basis are as follows (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) Wireless: CommSuite & Netwise $ 4,916 $ 4,958 $ 14,863 $ 13,721 SafePath 5,200 1,028 11,108 2,106 ViewSpot 450 — 1,971 — Consulting services and other 1,035 287 2,442 1,485 Legacy software licenses 13 10 38 293 Total wireless 11,614 6,283 $ 30,422 $ 17,605 Graphics: Software 168 242 646 1,328 Total revenues $ 11,782 $ 6,525 $ 31,068 $ 18,933 |
Segment, Customer Concentration
Segment, Customer Concentration and Geographical Information | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment, Customer Concentration and Geographical Information | 9. Segment, Customer Concentration and Geographical Information Segment Information Public companies are required to report financial and descriptive information about their reportable operating segments as required by FASB ASC Topic No. 280, Segment Reporting The Company does not separately allocate operating expenses to these business units, nor does it allocate specific assets. Therefore, business unit information reported includes only revenues. The following table shows the revenues generated by each business unit (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) Wireless $ 11,614 $ 6,283 $ 30,422 $ 17,605 Graphics 168 242 646 1,328 Total revenues $ 11,782 $ 6,525 $ 31,068 $ 18,933 Customer Concentration Information A summary of the Company’s customers that represent 10% or more of the Company’s net revenues is as follows: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) Wireless: Sprint (& affiliates) 83 % 86 % 81 % 81 % The customer listed above comprised 80% and 86% of our accounts receivable as of September 30, 2019 and 2018, respectively. Geographical Information During the three months ended September 30, 2019 and 2018, the Company operated in three geographic locations; the Americas, EMEA (Europe, the Middle East, and Africa), and Asia Pacific. Revenues attributed to the geographic location of the customers’ bill-to address were as follows (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) Americas $ 11,755 $ 6,483 $ 30,978 $ 18,724 EMEA 18 18 56 77 Asia Pacific 9 24 34 132 Total revenues $ 11,782 $ 6,525 $ 31,068 $ 18,933 The Company does not separately allocate specific assets to these geographic locations. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. Commitments and Contingencies Litigation The Company may become involved in various legal proceedings arising from its business activities. While management does not believe the ultimate disposition of these matters will have a material adverse impact on the Company’s consolidated results of operations, cash flows, or financial position, litigation is inherently unpredictable, and depending on the nature and timing of these proceedings, an unfavorable resolution could materially affect the Company’s future consolidated results of operations, cash flows, or financial position in a particular period. Other Contingent Contractual Obligations During its normal course of business, the Company has made certain indemnities, commitments, and guarantees under which it may be required to make payments in connection with certain transactions. These include: intellectual property indemnities to the Company’s customers and licensees in connection with the use, sale, and/or license of Company products; indemnities to various lessors in connection with facility leases for certain claims arising from use of such facility or under such lease; indemnities to vendors and service providers pertaining to claims based on the negligence or willful misconduct of the Company; indemnities involving the accuracy of representations and warranties in certain contracts; and indemnities to directors and officers of the Company to the maximum extent permitted under the laws of the State of Delaware. In addition, the Company has made contractual commitments to employees providing for severance payments upon the occurrence of certain prescribed events. The Company may also issue a guarantee in the form of a standby letter of credit as security for contingent liabilities under certain customer contracts. The duration of these indemnities, commitments, and guarantees varies, and in certain cases may be indefinite. The majority of these indemnities, commitments, and guarantees may not provide for any limitation of the maximum potential for future payments the Company could be obligated to make. The Company has not recorded any liability for these indemnities, commitments, and guarantees in the accompanying consolidated balance sheets. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | 11. Leases The Company leases office space and equipment, and certain office space is subleased. Management determines if a contract is a lease at the inception of the arrangement and reviews all options to extend, terminate, or purchase its right-of-use assets at the inception of the lease and accounts for these options when they are reasonably certain of being exercised. Leases with an initial term of greater than twelve months are recorded on the consolidated balance sheet. Lease expense is recognized on a straight-line basis over the lease term. The Company’s lease contracts generally do not provide a readily determinable implicit rate. For these contracts, the estimated incremental borrowing rate is based on information available at the inception of the lease. During the second quarter of 2019, the Company extended the lease term on its Pittsburgh, PA headquarters, which resulted in a net increase in right-of-use assets and lease liabilities of approximately $3.0 million. Additionally, an office lease in Aliso Viejo, CA commenced during the second quarter, which increased right-of-use assets and lease liabilities by approximately $1.5 million. Operating lease cost consists of the following (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, (unaudited) (unaudited) Lease cost $ 518 $ 1,553 Sublease income (151 ) (452 ) Total lease cost $ 367 $ 1,101 Operating lease assets and liabilities are summarized as follows (in thousands): As of September 30, 2019 (unaudited) Right-of-use assets $ 6,459 Current lease liabilities $ 1,154 Long-term lease liabilities 5,809 Total lease liabilities $ 6,963 The maturity of operating lease liabilities is presented in the following table (in thousands): As of September 30, 2019 (unaudited) 2019 $ 354 2020 1,654 2021 1,631 2022 1,220 2023 1,231 Thereafter 2,338 Total lease payments 8,428 Less imputed interest 1,465 Present value of lease liabilities $ 6,963 |
Equity Transactions
Equity Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Equity Transactions | 12. Equity Transactions In January 2019, the Company issued 2,699,531 shares of Common Stock in connection with its acquisition of the Smart Retail product suite of ISM Connect, LLC. See Note 3 for further details. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 13. Income Taxes We account for income taxes as required by FASB ASC Topic No. 740, Income Taxes The Company assesses whether a valuation allowance should be recorded against its deferred tax assets based on the consideration of all available evidence, using a “more likely than not” realization standard. The four sources of taxable income that must be considered in determining whether deferred tax assets will be realized are: (1) future reversals of existing taxable temporary differences (i.e., offset of gross deferred tax liabilities against gross deferred tax assets); (2) taxable income in prior carryback years, if carryback is permitted under the applicable tax law; (3) tax planning strategies; and (4) future taxable income exclusive of reversing temporary differences and carryforwards. In assessing whether a valuation allowance is required, significant weight is to be given to evidence that can be objectively verified. A significant factor in the Company’s assessment is that the Company has been in a five-year historical cumulative loss as of the end of fiscal 2017. These facts, combined with uncertain near-term market and economic conditions, reduced the Company’s ability to rely on projections of future taxable income in assessing the realizability of its deferred tax assets. After a review of the four sources of taxable income as of December 31, 2018 as described above, and after consideration of the Company’s continuing cumulative loss position as of December 31, 2018, the Company will continue to reserve its U.S.-based deferred tax amounts, which total $52.4 million as of September 30, 2019. The Company is subject to U.S. federal income tax as well as income tax of multiple state jurisdictions. Federal income tax returns of the Company are currently subject to IRS examination for the 2015 – 2017 tax years. State income tax returns are subject to examination for a period of three to four years after filing and currently the 2014-2017 tax years are open for audit. The outcome of tax audits cannot be predicted with certainty. If any issues addressed in the Company’s tax audits are resolved in a manner not consistent with management’s expectations, the Company could be required to adjust its provision for income tax in the period such resolution occurs. We may from time to time be assessed interest or penalties by major tax jurisdictions, although any such assessments historically have been minimal and immaterial to our consolidated financial results. It is the Company’s policy to classify any interest and/or penalties in the consolidated financial statements as a component of income tax expense. |
Gain on Sale of Software Produc
Gain on Sale of Software Product | 9 Months Ended |
Sep. 30, 2019 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Gain on Sale of Software Product | 14. Gain on Sale of Software Product In June 2019, pursuant to an Asset Purchase Agreement entered earlier in the same month, the Company sold certain assets of its Poser 3D animation software product to Bondware, Inc. for $500,000, of which $350,000 was paid at closing, with the remainder to be paid in quarterly installments over three years. The Company recorded a gain on the transaction in the amount of approximately $483,000, which is presented as Other Income in the consolidated statements of operations. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | 15. Subsequent Events The Company evaluates and discloses subsequent events as required by FASB ASC Topic No. 855, Subsequent Events |
Accounting Policies (Policies)
Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
The Company | The Company Smith Micro Software, Inc. (“Smith Micro” or the “Company”) develops software to simplify and enhance the mobile experience, providing solutions to some of the leading wireless service providers and cable multiple service operators (“MSOs”) around the world. From enabling the family digital lifestyle to providing powerful voice messaging capabilities, our solutions enrich today’s connected lifestyles while creating new opportunities to engage consumers via smartphones and consumer internet of things (“IoT”) devices. Our portfolio also includes a wide range of products for creating, sharing and monetizing rich content, such as visual messaging, optimizing retail content display, analytics capabilities, and graphics applications. |
Basis of Presentation | Basis of Presentation The accompanying interim consolidated balance sheet as of September 30, 2019, and the related consolidated statements of operations, stockholders’ equity and cash flows for each of the three and nine months ended September 30, 2019 and 2018, are unaudited. The unaudited consolidated financial statements have been prepared according to the rules and regulations of the Securities and Exchange Commission (“SEC”) and, therefore, certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted. In the opinion of management, the accompanying unaudited consolidated financial statements for the periods presented reflect all adjustments which are normal and recurring, and necessary to fairly state the financial position, results of operations, and cash flows of the Company. These unaudited consolidated financial statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018 filed with the SEC on March 27, 2019. Intercompany balances and transactions have been eliminated in consolidation. Operating results for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending December 31, 2019. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements The Company adopted the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic No. 842, Leases, |
Revenue Recognition | Revenue Recognition The Company adopted FASB ASC Topic No. 606, Revenue from Contracts with Customers, In our Wireless segment, we transfer software licenses to our customers on a royalty free, non-exclusive, non-transferrable, limited use basis during the term of the agreement. In some instances, we perform customization services to ensure the software operates within our customer’s operating platforms as well as the operating platforms of the mobile devices used by their end customers, before transferring the license. Revenue related to these services is recognized at a point in time upon acceptance of the software license by the customer. We also earn usage based revenue on our platforms. Usage based revenue is generated based on active licenses used by our customer’s end customers, the provision of hosting services, revenue share based on media placements on our platform, and use of our cloud based services. We recognize our usage based revenue when we have completed our performance obligation and have the right to invoice the customer. This revenue is generally recognized monthly or quarterly. We also provide consulting services to develop customer specified functionality that are generally not on our software development roadmap. We recognize revenue from our consulting services upon delivery and acceptance by the customer of our software enhancements and upgrades. For certain Wireless segment customers we provide maintenance and technology support services for which the customer either pays upfront or as we provide the services. When the customer pays upfront, we record the payments as contract liabilities and recognize revenue ratably over the contract period as this is our stand ready performance obligation that is satisfied ratably over the maintenance and technology services period. As discussed in Note 3, during the first quarter of 2019 we acquired the net assets of ISM Connect, LLC associated with the Smart Retail product suite, later branded ViewSpot™. Our ViewSpot contracts with Tier 1 customers include promises to provide multiple products and services. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. When a cloud-based service includes both on-premises software licenses and cloud 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 cloud service and recognized over time. Certain cloud services, primarily ViewSpot, depend on a significant level of integration, interdependency, and interrelation between the on-premise applications and cloud services, and are accounted for together as a single performance obligation. Revenue from ViewSpot is recognized ratably over the period in which the cloud services are provided. We receive upfront payments from customers from services to be provided under our ViewSpot arrangements. The advance receipts are deferred and subsequently recognized ratably over the contract period. We also provide consulting services to configure ad hoc targeted promotional content for our customers upon request. These requests are driven by our customers’ marketing initiatives and tend to be short term “bursts” of activity. We recognize these revenues upon delivery of the configured promotional content to the cloud platform. In our Graphics segment where we sell off-the-self software products with no customization or post sale technology support services, we recognize revenue at the time we transfer control of the product to the customer. This occurs upon shipment of the product or when the customer downloads the software from our website or website of our resellers. We offer a 30 day return option to our customers; a return reserve is established at the time revenue is recorded and the reserve is monitored and adjusted based on actual experience. Historically, returns have been insignificant. |
Fair Value Measurements | Fair Value Measurements The Company measures and discloses fair value measurements as required by FASB ASC Topic No. 820, Fair Value Measurements and Disclosures Fair value is an exit price, representing the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. As such, fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, the FASB establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: • Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets • Level 2 - Include other inputs that are directly or indirectly observable in the marketplace • Level 3 - Unobservable inputs which are supported by little or no market activity The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. As required by FASB ASC Topic No. 820, we measure our cash and cash equivalents at fair value. Our cash equivalents are classified within Level 1 by using quoted market prices utilizing market observable inputs. As required by FASB ASC Topic No. 820, we measured our warrant liability at fair value. Our warrant liability was classified within Level 3 as some of the inputs to our valuation model are either not observable quoted prices or are not derived principally from, or corroborated by, observable market data by correlation or other means. As required by FASB ASC Topic No. 350, for goodwill and other intangibles impairment analysis, we utilize fair value measurements which are categorized within Level 3 of the fair value hierarchy. |
Going Concern Evaluation | Going Concern Evaluation In connection with preparing consolidated financial statements for the three and nine months ended September 30, 2019, management evaluated whether there were conditions and events that, when considered in the aggregate, raised substantial doubt about the Company’s ability to continue as a going concern within one year from the date that the financial statements are issued. The Company considered the historical operating loss and negative cash flow from operating activities trends, including the positive trends occurring in the recent year. Ordinarily, conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern relate to the entity’s ability to meet its obligations as they become due. The Company evaluated its ability to meet its obligations as they become due within one year from the date that the financial statements are issued by considering the following: • In May 2017, the Company raised $2.2 million of new capital in a private placement offering of its common stock. • In September 2017, the Company closed on a $5.5 million preferred stock transaction which converted $2.8 million of long and short-term debt and raised $2.7 million of new capital. • On March 5, 2018, the Company raised $5.0 million of new capital in a private placement offering of its common stock. • On May 3, 2018, the Company raised $7.0 million of new capital in a private placement offering of its common stock. • On November 7, 2018, the Company raised $7.5 million of new capital in a private placement offering of its common stock. Following this transaction, $3.2 million of short and long-term debt was repaid. • During the third quarter of 2019, the Company received over $11.0 million in cash as a result of warrant exercises. Management believes the Company will generate enough cash from operations to satisfy its obligations for the next twelve months from the issuance date. The Company will take the following actions, if it starts to trend unfavorably against its internal profitability and cash flow projections, in order to mitigate conditions or events that would raise substantial doubt about its ability to continue as a going concern: • Raise additional capital through a private placement. • Raise additional capital through short-term loans. • Implement restructuring and cost reductions. • Secure a commercial bank line of credit. • Sell or license intellectual property. |
Goodwill | Goodwill In accordance with FASB ASC Topic No. 350, Intangibles-Goodwill and Other |
Earnings Per Share | Earnings Per Share The Company calculates earnings per share (“EPS”) as required by FASB ASC Topic No. 260, Earnings Per Share The following table sets forth the details of basic and diluted earnings per share: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited, in thousands, except per share amounts) (unaudited, in thousands, except per share amounts) Numerator: Net income (loss) $ 3,567 $ (983 ) $ 7,051 $ (5,541 ) Dividends paid to preferred stockholders (52 ) (43 ) (119 ) (370 ) Net income (loss) available to common stockholders $ 3,515 $ (1,026 ) $ 6,932 $ (5,911 ) Denominator: Weighted average shares outstanding – basic 36,094 25,020 33,170 20,771 Potential common shares – options / warrants (treasury stock method) 3,378 — 2,117 — Weighted average shares outstanding – diluted 39,472 25,020 35,287 20,771 Shares excluded (anti-dilutive) 67 126 131 1,086 Net earnings (loss) per common share: Basic $ 0.10 $ (0.04 ) $ 0.21 $ (0.28 ) Diluted $ 0.09 $ (0.04 ) $ 0.20 $ (0.28 ) |
Segment Information | Segment Information Public companies are required to report financial and descriptive information about their reportable operating segments as required by FASB ASC Topic No. 280, Segment Reporting |
Income Taxes | We account for income taxes as required by FASB ASC Topic No. 740, Income Taxes |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Summary of Consideration Paid for Acquisitions | The following table summarizes the consideration paid for the Smart Retail acquisition in 2019 (unaudited, in thousands): Fair value of assets acquired $ 9,394 Fair value of liabilities assumed 291 Total purchase price $ 9,103 Components of purchase price: Cash $ 3,974 Common stock 5,129 Total purchase price $ 9,103 |
Summary of Preliminary Allocation of Purchase Price | The Company’s preliminary allocation of the purchase price is summarized as follows (unaudited, in thousands): Assets: Costs incurred on projects not complete $ 53 Intangible assets 5,229 Goodwill 4,112 Total assets $ 9,394 Liabilities: Deferred revenue $ 291 Total liabilities 291 Total purchase price $ 9,103 |
Summary of Unaudited Proforma Results of Operation | Unaudited pro forma results of operations for the three and nine months ended September 30, 2019 and 2018 are included below as if the Smart Retail acquisition occurred on January 1, 2018. This summary of the unaudited pro forma results of operations is not necessarily indicative of what the Company’s results of operations would have been had Smart Retail been acquired at the beginning of 2018, nor does it purport to represent results of operations for any future periods. For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited, in thousands, except per share amounts) (unaudited, in thousands, except per share amounts) Revenues $ 11,782 $ 7,389 $ 31,068 $ 21,621 Net income (loss) 3,567 (705 ) 7,051 (4,790 ) Earnings (loss) per share: Basic $ 0.10 $ (0.03 ) $ 0.21 $ (0.25 ) Diluted $ 0.09 $ (0.03 ) $ 0.20 $ (0.25 ) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Details of Basic and Diluted Earnings Per Share | The following table sets forth the details of basic and diluted earnings per share: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited, in thousands, except per share amounts) (unaudited, in thousands, except per share amounts) Numerator: Net income (loss) $ 3,567 $ (983 ) $ 7,051 $ (5,541 ) Dividends paid to preferred stockholders (52 ) (43 ) (119 ) (370 ) Net income (loss) available to common stockholders $ 3,515 $ (1,026 ) $ 6,932 $ (5,911 ) Denominator: Weighted average shares outstanding – basic 36,094 25,020 33,170 20,771 Potential common shares – options / warrants (treasury stock method) 3,378 — 2,117 — Weighted average shares outstanding – diluted 39,472 25,020 35,287 20,771 Shares excluded (anti-dilutive) 67 126 131 1,086 Net earnings (loss) per common share: Basic $ 0.10 $ (0.04 ) $ 0.21 $ (0.28 ) Diluted $ 0.09 $ (0.04 ) $ 0.20 $ (0.28 ) |
Revenues (Tables)
Revenues (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Schedule of Revenues on Disaggregated Basis | Revenues on a disaggregated basis are as follows (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) Wireless: CommSuite & Netwise $ 4,916 $ 4,958 $ 14,863 $ 13,721 SafePath 5,200 1,028 11,108 2,106 ViewSpot 450 — 1,971 — Consulting services and other 1,035 287 2,442 1,485 Legacy software licenses 13 10 38 293 Total wireless 11,614 6,283 $ 30,422 $ 17,605 Graphics: Software 168 242 646 1,328 Total revenues $ 11,782 $ 6,525 $ 31,068 $ 18,933 |
Segment, Customer Concentrati_2
Segment, Customer Concentration and Geographical Information (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Revenues Generated by Each Business Unit | The following table shows the revenues generated by each business unit (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) Wireless $ 11,614 $ 6,283 $ 30,422 $ 17,605 Graphics 168 242 646 1,328 Total revenues $ 11,782 $ 6,525 $ 31,068 $ 18,933 |
Company's Customers that Represent 10% or More of Company's Net Revenues | A summary of the Company’s customers that represent 10% or more of the Company’s net revenues is as follows: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) Wireless: Sprint (& affiliates) 83 % 86 % 81 % 81 % |
Company Revenue in Different Geographic Locations | Revenues attributed to the geographic location of the customers’ bill-to address were as follows (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) Americas $ 11,755 $ 6,483 $ 30,978 $ 18,724 EMEA 18 18 56 77 Asia Pacific 9 24 34 132 Total revenues $ 11,782 $ 6,525 $ 31,068 $ 18,933 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Summary of Operating Lease Cost | Operating lease cost consists of the following (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, (unaudited) (unaudited) Lease cost $ 518 $ 1,553 Sublease income (151 ) (452 ) Total lease cost $ 367 $ 1,101 |
Summary of Operating Lease Assets and Liabilities | Operating lease assets and liabilities are summarized as follows (in thousands): As of September 30, 2019 (unaudited) Right-of-use assets $ 6,459 Current lease liabilities $ 1,154 Long-term lease liabilities 5,809 Total lease liabilities $ 6,963 |
Summary of Maturity of Operating Lease Liabilities | The maturity of operating lease liabilities is presented in the following table (in thousands): As of September 30, 2019 (unaudited) 2019 $ 354 2020 1,654 2021 1,631 2022 1,220 2023 1,231 Thereafter 2,338 Total lease payments 8,428 Less imputed interest 1,465 Present value of lease liabilities $ 6,963 |
Accounting Policies - Additiona
Accounting Policies - Additional Information (Detail) - USD ($) $ in Thousands | Jan. 01, 2019 | Sep. 30, 2019 |
Accounting Policies [Line Items] | ||
Net lease assets | $ 6,459 | |
Lease liabilities | 6,963 | |
Adjustment to retained earnings | $ 93 | |
ASC 842 [Member] | ||
Accounting Policies [Line Items] | ||
Net lease assets | $ 3,100 | |
Lease liabilities | 3,100 | |
Adjustment to retained earnings | $ 100 |
Acquisitions - Summary of Consi
Acquisitions - Summary of Consideration Paid for Acquisitions (Detail) - Smart Retail [Member] $ in Thousands | Jan. 09, 2019USD ($) |
Business Acquisition [Line Items] | |
Fair value of assets acquired | $ 9,394 |
Fair value of liabilities assumed | 291 |
Total purchase price | 9,103 |
Components of purchase price: | |
Cash | 3,974 |
Common stock | 5,129 |
Total purchase price | $ 9,103 |
Acquisitions - Summary of Preli
Acquisitions - Summary of Preliminary Allocation of Purchase Price (Detail) - USD ($) $ in Thousands | Sep. 30, 2019 | Jan. 09, 2019 | Dec. 31, 2018 |
Business Acquisition [Line Items] | |||
Goodwill | $ 7,797 | $ 3,685 | |
Smart Retail [Member] | |||
Business Acquisition [Line Items] | |||
Costs incurred on projects not complete | $ 53 | ||
Intangible assets | 5,229 | ||
Goodwill | 4,112 | ||
Total assets | 9,394 | ||
Deferred revenue | 291 | ||
Total liabilities | 291 | ||
Total purchase price | $ 9,103 |
Acquisitions - Summary of Unaud
Acquisitions - Summary of Unaudited Proforma Results of Operation (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Business Acquisition Pro Forma Information [Abstract] | ||||
Revenues | $ 11,782 | $ 7,389 | $ 31,068 | $ 21,621 |
Net income (loss) | $ 3,567 | $ (705) | $ 7,051 | $ (4,790) |
Earnings (loss) per share: | ||||
Basic | $ 0.10 | $ (0.03) | $ 0.21 | $ (0.25) |
Diluted | $ 0.09 | $ (0.03) | $ 0.20 | $ (0.25) |
Going Concern Evaluation - Addi
Going Concern Evaluation - Additional Information (Detail) - USD ($) $ in Thousands | Nov. 07, 2018 | May 03, 2018 | Mar. 05, 2018 | Sep. 30, 2017 | May 31, 2017 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 |
Going Concern Evaluation [Line Items] | |||||||||
Substantial doubt about going concern, management's evaluation | In connection with preparing consolidated financial statements for the three and nine months ended September 30, 2019, management evaluated whether there were conditions and events that, when considered in the aggregate, raised substantial doubt about the Company’s ability to continue as a going concern within one year from the date that the financial statements are issued.The Company considered the historical operating loss and negative cash flow from operating activities trends, including the positive trends occurring in the recent year. Ordinarily, conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern relate to the entity’s ability to meet its obligations as they become due. The Company evaluated its ability to meet its obligations as they become due within one year from the date that the financial statements are issued by considering the following: In May 2017, the Company raised $2.2 million of new capital in a private placement offering of its common stock. In September 2017, the Company closed on a $5.5 million preferred stock transaction which converted $2.8 million of long and short-term debt and raised $2.7 million of new capital. On March 5, 2018, the Company raised $5.0 million of new capital in a private placement offering of its common stock. On May 3, 2018, the Company raised $7.0 million of new capital in a private placement offering of its common stock. On November 7, 2018, the Company raised $7.5 million of new capital in a private placement offering of its common stock. Following this transaction, $3.2 million of short and long-term debt was repaid. During the third quarter of 2019, the Company received over $11.0 million in cash as a result of warrant exercises. Management believes the Company will generate enough cash from operations to satisfy its obligations for the next twelve months from the issuance date. | ||||||||
Common stock raised of new capital, value | $ (10) | $ (14) | $ 10,748 | ||||||
Preferred stock transaction | $ 5,500 | ||||||||
Debt instrument, principal amount | 2,800 | ||||||||
New equity capital raised | $ 2,700 | ||||||||
Proceeds from warrant exercises | $ 11,000 | $ 11,403 | |||||||
Substantial doubt about going concern, management's plans, substantial doubt not alleviated | The Company will take the following actions, if it starts to trend unfavorably against its internal profitability and cash flow projections, in order to mitigate conditions or events that would raise substantial doubt about its ability to continue as a going concern: Raise additional capital through a private placement. Raise additional capital through short-term loans. Implement restructuring and cost reductions. Secure a commercial bank line of credit. Sell or license intellectual property. | ||||||||
Private Placement [Member] | |||||||||
Going Concern Evaluation [Line Items] | |||||||||
Common stock raised of new capital, value | $ 7,500 | $ 7,000 | $ 5,000 | $ 2,200 | |||||
Repayments of debt | $ 3,200 |
Goodwill - Additional Informati
Goodwill - Additional Information (Detail) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Goodwill impairment | $ 0 | $ 0 |
Earnings Per Share - Details of
Earnings Per Share - Details of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Numerator: | ||||
Net income (loss) | $ 3,567 | $ (983) | $ 7,051 | $ (5,541) |
Dividends paid to preferred stockholders | (52) | (43) | (119) | (370) |
Net income (loss) available to common stockholders | $ 3,515 | $ (1,026) | $ 6,932 | $ (5,911) |
Denominator: | ||||
Weighted average shares outstanding – basic | 36,094 | 25,020 | 33,170 | 20,771 |
Potential common shares – options / warrants (treasury stock method) | 3,378 | 2,117 | ||
Weighted average shares outstanding – diluted | 39,472 | 25,020 | 35,287 | 20,771 |
Shares excluded (anti-dilutive) | 67 | 126 | 131 | 1,086 |
Net earnings (loss) per common share: | ||||
Basic | $ 0.10 | $ (0.04) | $ 0.21 | $ (0.28) |
Diluted | $ 0.09 | $ (0.04) | $ 0.20 | $ (0.28) |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - 2015 Omnibus Equity Incentive Plan [Member] | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019shares | Sep. 30, 2019shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares available for future grants | 1,300,000 | 1,300,000 |
Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted stock, granted | 0 | 1,250,000 |
Incentive Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Incentive stock options, granted | 0 | 55,000 |
Revenues - Additional Informati
Revenues - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Disaggregation Of Revenue [Abstract] | |||
Revenue recognized | $ 0 | $ 27 | |
Deferred revenue | $ 105 | $ 105 | $ 28 |
Revenues - Schedule of Revenues
Revenues - Schedule of Revenues on Disaggregated Basis (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disaggregation Of Revenue [Line Items] | ||||
Revenues | $ 11,782 | $ 6,525 | $ 31,068 | $ 18,933 |
Wireless [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 11,614 | 6,283 | 30,422 | 17,605 |
Wireless [Member] | CommSuite & Netwise [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 4,916 | 4,958 | 14,863 | 13,721 |
Wireless [Member] | SafePath [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 5,200 | 1,028 | 11,108 | 2,106 |
Wireless [Member] | ViewSpot [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 450 | 1,971 | ||
Wireless [Member] | Consulting Services and Other [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 1,035 | 287 | 2,442 | 1,485 |
Wireless [Member] | Legacy Software Licenses [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 13 | 10 | 38 | 293 |
Graphics [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 168 | 242 | 646 | 1,328 |
Graphics [Member] | Software [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | $ 168 | $ 242 | $ 646 | $ 1,328 |
Segment, Customer Concentrati_3
Segment, Customer Concentration and Geographical Information - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019Location | Sep. 30, 2018Location | Sep. 30, 2019Business_Unit | Sep. 30, 2018 | |
Revenue, Major Customer [Line Items] | ||||
Number of primary business units | Business_Unit | 2 | |||
Number of geographic locations | Location | 3 | 3 | ||
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Sprint and Fast Spring [Member] | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration percentage | 80.00% | 86.00% |
Segment, Customer Concentrati_4
Segment, Customer Concentration and Geographical Information - Revenues Generated by Each Business Unit (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue from External Customer [Line Items] | ||||
Total revenues | $ 11,782 | $ 6,525 | $ 31,068 | $ 18,933 |
Wireless [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenues | 11,614 | 6,283 | 30,422 | 17,605 |
Graphics [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenues | $ 168 | $ 242 | $ 646 | $ 1,328 |
Segment, Customer Concentrati_5
Segment, Customer Concentration and Geographical Information - Company's Customers that Represent 10% or More of Company's Net Revenues (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenues [Member] | Customer Concentration Risk [Member] | Wireless [Member] | Sprint and Affiliates [Member] | ||||
Revenue, Major Customer [Line Items] | ||||
Customer concentrating on 10% or more of net revenue | 83.00% | 86.00% | 81.00% | 81.00% |
Segment, Customer Concentrati_6
Segment, Customer Concentration and Geographical Information - Company Revenue in Different Geographic Locations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue from External Customer [Line Items] | ||||
Total revenues | $ 11,782 | $ 6,525 | $ 31,068 | $ 18,933 |
Americas [Member] | Reportable Geographical Components [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenues | 11,755 | 6,483 | 30,978 | 18,724 |
EMEA [Member] | Reportable Geographical Components [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenues | 18 | 18 | 56 | 77 |
Asia Pacific [Member] | Reportable Geographical Components [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenues | $ 9 | $ 24 | $ 34 | $ 132 |
Leases - Additional Information
Leases - Additional Information (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Jun. 30, 2019 | |
Lessee Lease Description [Line Items] | ||
Operating lease description | The Company leases office space and equipment, and certain office space is subleased. Management determines if a contract is a lease at the inception of the arrangement and reviews all options to extend, terminate, or purchase its right-of-use assets at the inception of the lease and accounts for these options when they are reasonably certain of being exercised. | |
Right-of-use assets | $ 6,459 | |
Lease liabilities | $ 6,963 | |
PA | ||
Lessee Lease Description [Line Items] | ||
Right-of-use assets | $ 3,000 | |
Lease liabilities | 3,000 | |
CA | ||
Lessee Lease Description [Line Items] | ||
Right-of-use assets | 1,500 | |
Lease liabilities | $ 1,500 |
Leases - Summary of Operating L
Leases - Summary of Operating Lease Cost (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Lease Cost [Abstract] | ||
Lease cost | $ 518 | $ 1,553 |
Sublease income | (151) | (452) |
Total lease cost | $ 367 | $ 1,101 |
Leases - Summary of Operating_2
Leases - Summary of Operating Lease Assets and Liabilities (Detail) $ in Thousands | Sep. 30, 2019USD ($) |
Assets And Liabilities Lessee [Abstract] | |
Right-of-use assets | $ 6,459 |
Current lease liabilities | 1,154 |
Long-term lease liabilities | 5,809 |
Total lease liabilities | $ 6,963 |
Leases - Summary of Maturity of
Leases - Summary of Maturity of Operating Lease Liabilities (Detail) $ in Thousands | Sep. 30, 2019USD ($) |
Operating Lease Liabilities Payments Due [Abstract] | |
2019 | $ 354 |
2020 | 1,654 |
2021 | 1,631 |
2022 | 1,220 |
2023 | 1,231 |
Thereafter | 2,338 |
Total lease payments | 8,428 |
Less imputed interest | 1,465 |
Present value of lease liabilities | $ 6,963 |
Equity Transactions - Additiona
Equity Transactions - Additional Information (Detail) - Common Stock [Member] - shares | 1 Months Ended | 9 Months Ended |
Jan. 31, 2019 | Sep. 30, 2019 | |
Class of Stock [Line Items] | ||
Number of common stock shares issued in connection with acquisition | 2,699,000 | |
Smart Retail [Member] | ||
Class of Stock [Line Items] | ||
Number of common stock shares issued in connection with acquisition | 2,699,531 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Operating Loss Carryforwards [Line Items] | |
Cumulative loss period | 5 years |
Reserve on US-based deferred tax amounts | $ 52.4 |
Earliest Tax Year [Member] | |
Operating Loss Carryforwards [Line Items] | |
Open tax year | 2014 |
Latest Tax Year [Member] | |
Operating Loss Carryforwards [Line Items] | |
Open tax year | 2017 |
State [Member] | |
Operating Loss Carryforwards [Line Items] | |
Federal income tax returns subject to examination description | State income tax returns are subject to examination for a period of three to four years after filing |
Federal [Member] | Earliest Tax Year [Member] | Internal Revenue Service (IRS) [Member] | |
Operating Loss Carryforwards [Line Items] | |
Open tax year | 2015 |
Federal [Member] | Latest Tax Year [Member] | Internal Revenue Service (IRS) [Member] | |
Operating Loss Carryforwards [Line Items] | |
Open tax year | 2017 |
Gain on Sale of Software Prod_2
Gain on Sale of Software Product - Additional Information (Detail) - USD ($) | 1 Months Ended | 9 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | |
Income Statement Balance Sheet and Additional Disclosures by Disposal Groups Including Discontinued Operations [Line Items] | ||
Proceeds from sale of software product | $ 363,000 | |
Gain on sale of software product | $ 483,000 | |
Asset Purchase Agreement [Member] | Poser 3D Software Product [Member] | Bondware, Inc. [Member] | ||
Income Statement Balance Sheet and Additional Disclosures by Disposal Groups Including Discontinued Operations [Line Items] | ||
Consideration for sale of asset | $ 500,000 | |
Proceeds from sale of software product | $ 350,000 | |
Remaining consideration payment period | 3 years | |
Gain on sale of software product | $ 483,000 |