CARE.COM INC, 10-Q filed on 5/12/2015
Quarterly Report
Document and Entity Information Document (USD $)
3 Months Ended
Mar. 28, 2015
May 5, 2015
Jun. 28, 2014
Document and Entity Information [Abstract]
 
 
 
Document Type
10-Q 
 
 
Amendment Flag
false 
 
 
Document Period End Date
Mar. 28, 2015 
 
 
Document Fiscal Year Focus
2015 
 
 
Document Fiscal Period Focus
Q1 
 
 
Trading Symbol
CRCM 
 
 
Entity Registrant Name
Care.com Inc 
 
 
Entity Central Index Key
0001412270 
 
 
Current Fiscal Year End Date
--12-26 
 
 
Entity Filer Category
Non-accelerated Filer 
 
 
Entity Common Stock, Shares Outstanding
 
31,957,306 
 
Entity Well-known Seasoned Issuer
No 
 
 
Entity Voluntary Filers
No 
 
 
Entity Current Reporting Status
Yes 
 
 
Entity Public Float
 
 
$ 0 
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)
In Thousands, unless otherwise specified
Mar. 28, 2015
Dec. 27, 2014
Current assets:
 
 
Cash and cash equivalents
$ 62,745 
$ 71,881 
Restricted cash
492 
85 
Accounts receivable
2,828 
2,592 
Unbilled accounts receivable
3,636 
3,541 
Prepaid expenses and other current assets
8,077 
7,961 
Total current assets
77,778 
86,060 
Property and equipment, net
6,932 
6,323 
Intangible assets, net
7,780 
8,965 
Goodwill
66,536 
68,685 
Other non-current assets
3,030 
3,071 
Total assets
162,056 
173,104 
Current liabilities:
 
 
Accounts payable
5,697 
5,463 
Accrued expenses and other current liabilities
13,325 
12,732 
Current contingent acquisition consideration
8,000 
10,685 
Deferred revenue
15,117 
13,346 
Total current liabilities
42,139 
42,226 
Contingent acquisition consideration
7,415 
7,267 
Deferred tax liability
2,587 
2,119 
Other non-current liabilities
3,626 
3,442 
Total liabilities
55,767 
55,054 
Contingencies (see note 6)
   
   
Stockholders' equity
 
 
Common stock, $0.001 par value; 300,000 shares authorized; 31,943 and 31,615 shares issued and outstanding, respectively
32 
32 
Additional paid-in capital
278,838 
277,583 
Accumulated deficit
(171,871)
(159,859)
Accumulated other comprehensive (loss) income
(710)
294 
Total stockholders' equity
106,289 
118,050 
Total liabilities and stockholders' equity
$ 162,056 
$ 173,104 
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
Mar. 28, 2015
Dec. 27, 2014
Statement of Financial Position [Abstract]
 
 
Common stock, par value, in dollars per share
$ 0.001 
$ 0.001 
Common stock, shares authorized
300,000,000 
300,000,000 
Common stock, shares issued
31,943,000 
31,943,000 
Common stock, shares outstanding
31,615,000 
31,615,000 
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Income Statement [Abstract]
 
 
Revenue
$ 35,120 
$ 25,271 
Cost of revenue
9,548 
5,771 
Operating expenses:
 
 
Selling and marketing
21,042 
20,449 
Research and development
5,015 
4,064 
General and administrative
8,501 
6,232 
Depreciation and amortization
1,275 
1,068 
Total operating expenses
35,833 
31,813 
Operating loss
(10,261)
(12,313)
Other expense, net
(1,191)
(2,746)
Loss before income taxes
(11,452)
(15,059)
Provision for income taxes
560 
485 
Net loss
(12,012)
(15,544)
Accretion of preferred stock
0 
(4)
Net loss attributable to common stockholders
$ (12,012)
$ (15,548)
Net loss per share attributable to common stockholders:
 
 
Basic and diluted (in dollars per share)
$ (0.38)
$ (0.71)
Weighted-average shares used to compute net loss per share attributable to common stockholders:
 
 
Basic and diluted (in shares)
31,763 
21,899 
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Statement of Comprehensive Income [Abstract]
 
 
Net loss
$ (12,012)
$ (15,544)
Other comprehensive income:
 
 
Foreign currency translation adjustments
(1,004)
(148)
Comprehensive loss
$ (13,016)
$ (15,692)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Dec. 27, 2014
Cash flows from operating activities
 
 
 
Net loss
$ (12,012)
$ (15,544)
 
Adjustments to reconcile net loss to net cash used in operating activities:
 
 
 
Stock-based compensation
938 
1,099 
 
Depreciation and amortization
1,497 
1,261 
 
Deferred taxes
498 
415 
 
Contingent consideration expense
308 
73 
 
Change in fair value of contingent consideration payable in preferred stock
0 
2,258 
 
Change in fair value of stock warrants
0 
606 
 
Other non-operating expenses
(56)
0 
 
Changes in operating assets and liabilities, net of effects from acquisitions:
 
 
 
Restricted cash
(480)
(431)
 
Accounts receivable
(253)
(592)
 
Unbilled accounts receivable
(336)
(560)
 
Prepaid expenses and other current assets
(356)
(203)
 
Other non-current assets
14 
(3)
 
Accounts payable
2,513 
2,142 
 
Accrued expenses and other current liabilities
(296)
3,266 
 
Deferred revenue
2,080 
2,103 
 
Other non-current liabilities
213 
(13)
 
Net cash used in operating activities
(5,728)
(4,123)
 
Cash flows from investing activities
 
 
 
Purchases of property and equipment
(3,272)
(128)
 
Payments for acquisitions, net of cash acquired
0 
(489)
 
Cash withheld for purchase consideration
73 
(86)
 
Net cash used in investing activities
(3,199)
(703)
 
Cash flows from financing activities
 
 
 
Proceeds from initial public offering net of offering costs
0 
96,242 
 
Proceeds from the issuance of common stock
524 
157 
 
Payments of contingent consideration previously established in purchase accounting
(1,840)
(2,845)
 
Net cash provided by financing activities
(1,316)
93,554 
 
Effect of exchange rate changes on cash and cash equivalents
1,107 
(125)
 
Net increase (decrease) in cash and cash equivalents
(9,136)
88,603 
 
Cash and cash equivalents, beginning of the period
71,881 
29,959 
29,959 
Cash and cash equivalents, end of the period
62,745 
118,562 
71,881 
Supplemental disclosure of cash flow activities
 
 
 
Cash paid for taxes
3 
 
9 
Supplemental disclosure of non-cash investing and financing activities
 
 
 
Non-cash purchases of property and equipment
301 
 
0 
Issuance of preferred and common stock in connection with acquisitions
4,878 
 
2,622 
Accretion of preferred stock to redemption value
0 
4 
4 
Conversion of preferred stock to common stock
0 
 
154,856 
Reclassification of warrant liability to additional paid-in capital
0 
 
968 
Reclassification of contingent consideration payable in common shares
0 
 
4,878 
Unpaid deferred offering costs
$ 0 
 
$ 231 
Description of Business and Summary of Significant Accounting Policies
Description of Business and Summary of Significant Accounting Policies
Description of Business and Summary of Significant Accounting Policies
Care.com, Inc. (the “Company”, “we”, “us”, and “our”), a Delaware corporation, was incorporated on October 27, 2006. We are the world’s largest online marketplace for finding and managing family care. Our consumer matching solutions enable families to connect to caregivers and caregiving services in a reliable and easy way and our payment solutions enable families to pay caregivers electronically online or via their mobile device and to manage their household payroll and tax matters with Care.com HomePay. In addition, we serve employers by providing access to our platform to employer-sponsored families and care-related businesses-such as day care centers, nanny agencies and home care agencies-who wish to market their services to our care-seeking families and recruit our caregiver members. We also operate a social commerce service selling curated products designed for families. This service generates revenue through the sale of subscriptions and other products to customers in the United States.
Certain Significant Risks and Uncertainties
We operate in a dynamic industry and, accordingly, our business is affected by a variety of factors. For example, we believe that unfavorable changes in any of the following areas could have a significant negative effect on our future financial position, results of operations or cash flows: rates of revenue growth; member acquisition costs; member engagement and usage of our new and existing products; our ability to scale and adapt our existing technology and network infrastructure; competition in our market; management of our growth; our acquisitions and investments; our ability to retain qualified employees and key personnel; protection of our brand and intellectual property; protection of customers’ information and privacy concerns; security measures related to our website; our ability to access capital at acceptable terms, among other things.
Basis of Presentation
The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended December 27, 2014, filed on March 27, 2015.
There have been no material changes in our significant accounting policies for the three months ended March 28, 2015 as compared to the significant accounting policies described in our Annual Report on Form 10-K for the fiscal year ended December 27, 2014. Certain immaterial amounts in our December 27, 2014 consolidated financial statements within accrued expenses have been reclassified to be comparable with classifications used in our March 28, 2015 condensed consolidated financial statements.
The condensed consolidated balance sheet as of December 27, 2014, included herein was derived from the audited financial statements as of that date, but does not include all disclosures including notes required by GAAP on an annual reporting basis.
In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods, and are not necessarily indicative of the results of operations to be anticipated for Fiscal 2015 or any future period.
Principles of Consolidation
The accompanying condensed consolidated financial statements include the accounts of the Company and our wholly owned subsidiaries, after elimination of all intercompany balances and transactions.
Fiscal Year-End
We operate and report using a 52 or 53 week fiscal year ending on the Saturday in December closest and prior to December 31. Accordingly, our fiscal quarters end on the Saturday that falls closest to the last day of the third month of each quarter.
Use of Estimates
The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting period. On an ongoing basis, we evaluate our estimates, including those related to accounts receivable and revenue allowances, intangible asset valuations, expected future cash flows used to evaluate the recoverability of long-lived assets, the useful lives of long-lived assets including property and equipment and intangible assets, fair value of stock-based awards, goodwill, income taxes, contingent consideration, and contingencies. We base our estimates of the carrying value of certain assets and liabilities on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, when these carrying values are not readily available from other sources. These estimates are based on information available as of the date of the condensed consolidated financial statements; therefore, actual results could differ from the estimates.
Subsequent Events Consideration
We consider events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. There were no material recognized subsequent events recorded in the condensed consolidated financial statements as of and for the three months ended March 28, 2015.
Recently Issued and Adopted Accounting Pronouncements
In February 2015, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update, or ASU, No. 2015-02, "Consolidation (Topic 810)-Amendments to the Consolidation Analysis," which amends the criteria for determining which entities are considered variable interest entities, or VIEs, amends the criteria for determining if a service provider possesses a variable interest in a VIE and ends the deferral granted to investment companies for application of the VIE consolidation model. ASU 2015-02 is effective for annual periods, and interim periods therein, beginning after December 15, 2015. We are currently evaluating the impact the adoption of Topic 810 will have on our financial statements.
In January 2015, the FASB issued Accounting Standards Update No. 2015-01, Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items ("ASU 2015-01”), which eliminates the requirement of Extraordinary Items to be separately classified on the income statement.  ASU 2015-01 is effective for annual periods ending after December 15, 2015 and for annual and interim periods thereafter.  Early application is permitted.  The adoption of ASU 2015-01 is not expected to have a material effect on our condensed consolidated financial statements or disclosures.
In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern. ASU 2014-15 requires management to evaluate, at each annual or interim reporting period, whether there are conditions or events that exist that raise substantial doubt about an entity's ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and earlier application is permitted. The Company is currently evaluating the impact of the adoption of ASU 2014-15, but the adoption is not expected to have a material effect on our consolidated financial statements or disclosures.
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for us in our fiscal year 2017. Early application is not permitted. We are evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. The standard permits the use of either the retrospective or cumulative effect transition method. We have not yet selected a transition method nor have we determined the effect of the standard on our ongoing financial reporting.
Fair Value Measurements
Fair Value Measurements
Fair Value Measurements
The following table presents information about our assets and liabilities measured at fair value on a recurring basis as of March 28, 2015 and December 27, 2014 and indicates the fair value hierarchy of the valuation techniques we utilized to determine such fair value (in thousands):
 
March 28, 2015
 
December 27, 2014
 
Fair Value Measurements Using Input Types
 

 
Fair Value Measurements Using Input Types
 

 
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets:

 

 

 

 

 

 

 

Money market mutual funds and certificates of deposit
$
4,366

 
$
—

 
$
—

 
$
4,366

 
$
15,656

 
$
—

 
$
—

 
$
15,656

Total assets
$
4,366

 
$
—

 
$
—

 
$
4,366

 
$
15,656

 
$
—

 
$
—

 
$
15,656

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities:


 


 


 


 


 


 


 


Contingent acquisition consideration
$
—

 
$
—

 
$
15,415

 
$
15,415

 
$
—

 
$
—

 
$
17,952

 
$
17,952

Total liabilities
$
—

 
$
—

 
$
15,415

 
$
15,415

 
$
—

 
$
—

 
$
17,952

 
$
17,952


The following table sets forth a summary of changes in the fair value of our contingent acquisition consideration which represents recurring measurements that are classified within Level 3 of the fair value hierarchy wherein fair value is estimated using significant unobservable inputs (in thousands):
 
March 28, 2015
 
Contingent Acquisition
Consideration
Beginning balance
$
17,952

Contingent consideration liability recorded in connection with Citrus Lane acquisition
—

Increase in fair value included in earnings
308

Reclassification to permanent equity
—

Contingent acquisition consideration payments
(2,845
)
Ending balance
$
15,415


Non-Recurring Fair Value Measurements
We re-measure the fair value of certain assets and liabilities upon the occurrence of certain events. Such assets are comprised of long-lived assets, including property and equipment, intangible assets and goodwill. No re-measurement of such assets occurred at March 28, 2015 and December 27, 2014. Other financial instruments not measured or recorded at fair value in the accompanying condensed consolidated balance sheets principally consist of accounts receivable, accounts payable, and accrued liabilities. The estimated fair values of these instruments approximate their carrying values due to their short-term nature.
Supplemental Balance Sheet Information
Supplemental Balance Sheet Information
Supplemental Balance Sheet Information
The following table presents the detail of property and equipment, net for the periods presented (in thousands):
 
March 28,
2015
 
December 27,
2014
Computer equipment
$
2,603

 
$
2,476

Furniture and fixtures
1,816

 
1,708

Software
1,228

 
1,066

Leasehold improvements
3,736

 
3,137

Total
9,383

 
8,387

Less accumulated depreciation
(2,451
)
 
(2,064
)
Property and equipment, net
$
6,932

 
$
6,323


Depreciation expense for the three months ended March 28, 2015 and March 29, 2014 was $0.4 million and $0.2 million, respectively.
The following table presents the detail of accrued expenses and other current liabilities for the periods presented (in thousands):
 
March 28,
2015
 
December 27,
2014
Payroll and compensation
$
3,188

 
$
2,388

Tax-related expense
1,086

 
843

Marketing expenses
4,974

 
3,385

Other accrued expenses
4,077

 
6,116

Total accrued expenses and other current liabilities
$
13,325

 
$
12,732

Goodwill and Intangible Assets
Goodwill and Intangible Assets
Goodwill and Intangible Assets
The following table presents the change in goodwill for the periods presented (in thousands):
 
CRCM Businesses, Pre-Citrus Lane
 
Citrus Lane
 
Total
Balance as of December 27, 2014
$
60,635

 
$
8,050

 
$
68,685

Effect of currency translation
(2,149
)
 
—

 
(2,149
)
Balance as of March 28, 2015
$
58,486

 
$
8,050

 
$
66,536

 
 
 
 
 
 
Total impairment recognized to date
$
—

 
$
36,227

 
$
36,227


The following table presents the detail of intangible assets for the periods presented (dollars in thousands):
 
Gross Carrying Value
 
Accumulated Amortization
 
Net Carrying Value
 
Weighted-Average Remaining Life (Years)
March 28, 2015
 
 
 
 
 
 
 
Indefinite lived intangibles
$
242

 
$
—

 
$
242

 
N/A
Trademarks and trade names
5,212

 
(3,696
)
 
1,516

 
5.8
Proprietary software
4,737

 
(3,307
)
 
1,430

 
2.3
Website
1,150

 
(79
)
 
1,071

 
6.2
Training materials
30

 
(22
)
 
8

 
0.8
Non-compete agreements
129

 
(95
)
 
34

 
2.0
Leasehold interests
170

 
(67
)
 
103

 
4.1
Caregiver relationships
284

 
(252
)
 
32

 
0.5
Customer relationships
8,776

 
(5,432
)
 
3,344

 
2.8
Total
$
20,730

 
$
(12,950
)
 
$
7,780

 

 
 
 
 
 
 
 
 
December 27, 2014
 
 
 
 
 
 
 
Indefinite lived intangibles
$
242

 
$
—

 
$
242

 
N/A
Trademarks and trade names
5,281

 
(3,377
)
 
1,904

 
5.2
Proprietary software
4,942

 
(3,351
)
 
1,591

 
2.5
Website
1,150

 
(34
)
 
1,116

 
6.5
Training materials
30

 
(20
)
 
10

 
1.0
Non-compete agreements
137

 
(94
)
 
43

 
2.0
Leasehold interests
170

 
(61
)
 
109

 
4.4
Caregiver relationships
312

 
(252
)
 
60

 
0.7
Customer relationships
8,857

 
(4,967
)
 
3,890

 
2.9
Total
$
21,121

 
$
(12,156
)
 
$
8,965

 
 

Amortization expense was $1.1 million and $1.1 million for the three months ended March 28, 2015 and March 29, 2014, respectively. Of these amounts, $0.9 million and $0.9 million was classified as a component of depreciation and amortization, and $0.2 million and $0.2 million was classified as a component of cost of revenue in the condensed consolidated statements of operations for the three months ended March 28, 2015 and March 29, 2014, respectively.
As of March 28, 2015, the estimated future amortization expense related to intangible assets for future fiscal years was as follows (in thousands):
2015 remaining
$
2,746

2016
2,200

2017
797

2018
452

2019
395

Thereafter
948

Total
$
7,538

Contingencies
Commitments and Contingencies
Contingencies
Legal matters
From time to time, we have or may become party to litigation incident to the ordinary course of business. We assess the likelihood of any adverse judgments or outcomes with respect to these matters and determine loss contingency assessments on a gross basis after assessing the probability of incurrence of a loss and whether a loss is reasonably estimable. In addition, we consider other relevant factors that could impact our ability to reasonably estimate a loss. A determination of the amount of reserves required, if any, for these contingencies is made after analyzing each matter. Our reserve may change in the future due to new developments or changes in strategy in handling these matters. Although the results of litigation and claims cannot be predicted with certainty, we currently believe that the final outcome of all pending matters will not have a material adverse effect on our business, condensed consolidated financial position, results of operations, or cash flows. Regardless of the outcome, litigation can adversely impact us due to defense and settlement costs, diversion of management resources, and other factors.
Stockholders’ Equity
Stockholders’ Equity
Stockholders’ Equity
Initial Public Offering (IPO)
On January 29, 2014, we closed our IPO in which we sold and issued 6,152,500 shares of common stock, including 802,500 shares of common stock pursuant to the exercise of the underwriters’ option to purchase additional shares, which were sold to the public at a price of $17.00 per share. We received net proceeds of approximately $94.8 million from the IPO, including the exercise of the underwriters’ over-allotment option, net of underwriters’ discounts and commissions, and after deducting offering expenses of approximately $2.4 million.
Upon the closing of the IPO, all shares of our outstanding redeemable convertible preferred stock automatically converted into 21,490,656 shares of common stock and our outstanding warrant to purchase redeemable convertible preferred stock automatically converted into a warrant to purchase 40,697 shares of common stock at $1.72 per share, which were subsequently exercised during the three months ended March 29, 2014.
Common Stock
As of March 28, 2015, we had reserved the following shares of common stock for future issuance in connection with the following (in thousands):
 
March 28, 2015
 
Contingent consideration payable in common stock
106

 
Options issued and outstanding
3,965

 
Options available for grant under stock option plans
4,493

 
Total
8,564

 

Stock-Based Compensation
A summary of stock option activity for the three months ended March 28, 2015 was as follows (in thousands for shares and intrinsic value):
 
Number of Shares
 
Weighted-Average Remaining Contractual Term (Years)
 
Weighted-Average Exercise Price
 
Aggregate Intrinsic Value
 
 
 
 
 
 
 
 
Outstanding as of December 27, 2014
4,270

 
7.17
 
$
6.47

 
$
14,373

Granted
—

 
 
 
—

 
 
Canceled and forfeited
(166
)
 
 
 
6.64

 
 
Exercised
(138
)
 
 
 
7.76

 
 
Outstanding as of March 28, 2015
3,965

 
7.16
 
$
6.61

 
$
11,872

Options vested and exercisable as of March 28, 2015
2,445

 
6.35
 
$
4.5

 
$
9,943

Options vested and expected to vest as of March 28, 2015 (1)
3,860

 
7.10
 
$
6.48

 
$
11,775

____________________________
(1) Options expected to vest reflect an estimated forfeiture rate
Aggregate intrinsic value represents the difference between the closing stock price of our common stock and the exercise price of outstanding, in-the-money options. Our closing stock price as reported on the New York Stock Exchange as of March 28, 2015 was $7.93. The total intrinsic value of options exercised was approximately $0.8 million for the three months ended March 28, 2015. The aggregate fair value of the options that vested during the three months ended March 28, 2015 and March 29, 2014 was $1.1 million and $1.3 million respectively.
As of March 28, 2015, total unrecognized compensation cost, adjusted for estimated forfeitures, related to non-vested stock options was approximately $7.2 million, which is expected to be recognized over the next 2.4 years. As of March 28, 2015, we had 4,492,737 shares available for grant under the 2014 Plan.
The following table presents the assumptions used to estimate the fair value of options granted during the periods presented:
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
Risk-free interest rate
N/A
 
1.85 - 2.88%
Expected term (years)
N/A
 
6.25
Volatility
N/A
 
47.1 - 47.3%
Expected dividend yield
N/A
 
—

The following table summarizes stock-based compensation in our accompanying condensed consolidated statements of operations (in thousands):
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
Cost of revenue
$
48

 
$
47

Selling and marketing
161

 
146

Research and development
82

 
89

General and administrative
647

 
817

   Total stock-based compensation
$
938

 
$
1,099

Net Loss Per Share
Net Loss Per Share
Net Loss Per Share
Basic net loss per share is computed by dividing net loss attributable to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per share attributable to common shareholders is computed by dividing net loss by the weighted-average number of common shares outstanding during the period and potentially dilutive common stock equivalents, except in cases where the effect of common stock equivalent would be anti-dilutive. Potential common stock equivalents consist of common stock issuable upon exercise of stock options as well as shares issuable under outstanding contingent consideration arrangements.
The following equity shares were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented (in thousands):
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
Stock options
3,966

 
3,963

Contingent consideration
106

 
191

Income Taxes
Income Taxes
Income Taxes
We recorded income tax expense of $0.6 million and $0.5 million for the three months ended March 28, 2015 and March 29, 2014, respectively. The tax provision recorded in the three months ended March 28, 2015 and March 29, 2014 relates to the amortization of HomePay goodwill for tax purposes for which there is no corresponding book deduction and certain state taxes based on operating income that are payable without regard to our tax loss carry forwards.
Segment and Geographical Information
Segment and Geographical Information
Segment and Geographical Information
We consider operating segments to be components of the Company in which separate financial information is available that is evaluated regularly by our chief operating decision maker in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is the CEO. The CEO reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance. Accordingly, effective for the first quarter of Fiscal 2015, we have determined that we have two operating and reportable segments, CRCM Businesses, Pre-Citrus Lane and Citrus Lane. The descriptions of the resulting reportable segments are included below and all financial information presented herein related to the resulting reportable segments has been presented retrospectively as though these segments existed as of the earliest period presented.
CRCM Businesses, Pre-Citrus Lane
CRCM Businesses, Pre-Citrus Lane is comprised of consumer matching solutions, which provide families access to caregiver job postings, search features, caregiver profiles and content; consumer payments solutions, which provide families options to manage their financial relationship with their caregiver through the use of household employer payroll and tax services, as well as electronic convenience payments; and our employee offering which provides corporate employers access to a comprehensive suite of products and services that can be offered as an employee benefit. This reportable segment represents an aggregation of operating units within the segment.
Citrus Lane
Citrus Lane includes sales of merchandise through the sales of curated products designed for families. The majority of sales are made through the sale of subscription discovery boxes, whereby customers prepay to receive monthly shipments of a box containing children’s merchandise. The subscriptions offered to our customers are for one, three, six or twelve month terms. We also offer individual products on an a-la-carte basis through an “add-to-box” and e-commerce shop offerings. “Add-to-box” sales are extra items that customers can add to be shipped with their subscription box or purchased separately from the subscription sales.
We measure and evaluate our reportable segments based on segment revenues and segment adjusted EBITDA which is defined as net loss, plus: (1) federal, state and franchise taxes; (2) other expense, net; (3) depreciation and amortization; (4) stock based compensation; (5) accretion of contingent consideration; (6) merger and acquisition related costs; and (7) other unusual or non-cash significant adjustments.
The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies (refer to Note 2 of our Annual Report on Form 10-K for the fiscal year ended December 27, 2014). We fully allocate depreciation expense to our two reportable segments. We do not report our assets or capital expenditures by segment as it would not be meaningful. Segment information for the three months ended March 28, 2015 and March 29, 2014 was as follows (in thousands):
 
 
Three Months Ended
 
 
March 28, 2015
 
 
CRCM Businesses, Pre-Citrus Lane
 
Citrus Lane
 
Total
Revenue
 
$
32,049

 
$
3,071

 
$
35,120

Adjusted EBITDA
 
(5,604
)
 
(1,458
)
 
(7,062
)
Depreciation and amortization
 
(1,425
)
 
(72
)
 
(1,497
)
Stock based compensation
 
(822
)
 
(116
)
 
(938
)
Other charges
 
(194
)
 
(570
)
 
(764
)
Operating loss
 
(8,045
)
 
(2,216
)
 
(10,261
)
Other expense, net
 
 
 
 
 
(1,191
)
Loss before income taxes
 
 
 
 
 
(11,452
)
Provision for income taxes
 
 
 
 
 
560

Net Loss
 
 
 
 
 
(12,012
)
 
 
Three Months Ended
 
 
March 29, 2014
 
 
CRCM Businesses, Pre-Citrus Lane
 
Citrus Lane
 
Total
Revenue
 
$
25,271

 
$
—

 
$
25,271

Adjusted EBITDA
 
(9,649
)
 
—

 
(9,649
)
Depreciation and amortization
 
(1,261
)
 
—

 
(1,261
)
Stock based compensation
 
(1,099
)
 
—

 
(1,099
)
Other charges
 
(304
)
 
—

 
(304
)
Operating loss
 
(12,313
)
 
—

 
(12,313
)
Other expense, net
 
 
 
 
 
(2,746
)
Loss before income taxes
 
 
 
 
 
(15,059
)
Provision for income taxes
 
 
 
 
 
485

Net Loss
 
 
 
 
 
(15,544
)

Total assets for the CRCM Businesses, Pre-Citrus Lane and Citrus Lane as of March 28, 2015 were $153.2 million and $8.9 million, respectively. Total assets for the CRCM Businesses, Pre-Citrus Lane and Citrus Lane for as of December 27, 2014 were $163.1 million and $10.0 million, respectively.
No country outside of the United States provided greater than 10% of our total revenue. Revenue is classified by the major geographic areas in which our customers are located. The following table summarizes total revenue generated by our geographic locations (dollars in thousands):
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
United States
$
32,855

 
$
23,492

International
2,265

 
1,779

Total revenue
$
35,120

 
$
25,271

 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
 
(As a percentage of revenue)
United States
94
%
 
93
%
International
6
%
 
7
%
Total revenue
100
%
 
100
%

Our long-lived assets are primarily located in the United States and are not allocated to any specific region. Therefore, geographic information is presented only for total revenue.
Other Expense, Net
Other Expense, Net
Other Expense, Net
Other expense, net consisted of the following (in thousands):
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
Interest income
$
34

 
$
20

Interest expense
(28
)
 
(7
)
Other expense, net
(1,197
)
 
(2,759
)
Total other expense, net
$
(1,191
)
 
$
(2,746
)
Description of Business and Summary of Significant Accounting Policies (Policies)
Basis of Presentation 
Basis of Presentation
The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended December 27, 2014, filed on March 27, 2015.
There have been no material changes in our significant accounting policies for the three months ended March 28, 2015 as compared to the significant accounting policies described in our Annual Report on Form 10-K for the fiscal year ended December 27, 2014. Certain immaterial amounts in our December 27, 2014 consolidated financial statements within accrued expenses have been reclassified to be comparable with classifications used in our March 28, 2015 condensed consolidated financial statements.
The condensed consolidated balance sheet as of December 27, 2014, included herein was derived from the audited financial statements as of that date, but does not include all disclosures including notes required by GAAP on an annual reporting basis.
In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods, and are not necessarily indicative of the results of operations to be anticipated for Fiscal 2015 or any future period.
Principles of Consolidation 
Principles of Consolidation
The accompanying condensed consolidated financial statements include the accounts of the Company and our wholly owned subsidiaries, after elimination of all intercompany balances and transactions.
Fiscal Year-End 
Fiscal Year-End
We operate and report using a 52 or 53 week fiscal year ending on the Saturday in December closest and prior to December 31. Accordingly, our fiscal quarters end on the Saturday that falls closest to the last day of the third month of each quarter.
Use of Estimates 
Use of Estimates
The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting period. On an ongoing basis, we evaluate our estimates, including those related to accounts receivable and revenue allowances, intangible asset valuations, expected future cash flows used to evaluate the recoverability of long-lived assets, the useful lives of long-lived assets including property and equipment and intangible assets, fair value of stock-based awards, goodwill, income taxes, contingent consideration, and contingencies. We base our estimates of the carrying value of certain assets and liabilities on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, when these carrying values are not readily available from other sources. These estimates are based on information available as of the date of the condensed consolidated financial statements; therefore, actual results could differ from the estimates.
Subsequent Events Consideration 
Subsequent Events Consideration
We consider events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. There were no material recognized subsequent events recorded in the condensed consolidated financial statements as of and for the three months ended March 28, 2015.
Recently Issued and Adopted Accounting Pronouncements 
Recently Issued and Adopted Accounting Pronouncements
In February 2015, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update, or ASU, No. 2015-02, "Consolidation (Topic 810)-Amendments to the Consolidation Analysis," which amends the criteria for determining which entities are considered variable interest entities, or VIEs, amends the criteria for determining if a service provider possesses a variable interest in a VIE and ends the deferral granted to investment companies for application of the VIE consolidation model. ASU 2015-02 is effective for annual periods, and interim periods therein, beginning after December 15, 2015. We are currently evaluating the impact the adoption of Topic 810 will have on our financial statements.
In January 2015, the FASB issued Accounting Standards Update No. 2015-01, Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items ("ASU 2015-01”), which eliminates the requirement of Extraordinary Items to be separately classified on the income statement.  ASU 2015-01 is effective for annual periods ending after December 15, 2015 and for annual and interim periods thereafter.  Early application is permitted.  The adoption of ASU 2015-01 is not expected to have a material effect on our condensed consolidated financial statements or disclosures.
In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern. ASU 2014-15 requires management to evaluate, at each annual or interim reporting period, whether there are conditions or events that exist that raise substantial doubt about an entity's ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and earlier application is permitted. The Company is currently evaluating the impact of the adoption of ASU 2014-15, but the adoption is not expected to have a material effect on our consolidated financial statements or disclosures.
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for us in our fiscal year 2017. Early application is not permitted. We are evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. The standard permits the use of either the retrospective or cumulative effect transition method. We have not yet selected a transition method nor have we determined the effect of the standard on our ongoing financial reporting.
Fair Value Measurements (Tables)
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis 
The following table presents information about our assets and liabilities measured at fair value on a recurring basis as of March 28, 2015 and December 27, 2014 and indicates the fair value hierarchy of the valuation techniques we utilized to determine such fair value (in thousands):
 
March 28, 2015
 
December 27, 2014
 
Fair Value Measurements Using Input Types
 

 
Fair Value Measurements Using Input Types
 

 
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets:

 

 

 

 

 

 

 

Money market mutual funds and certificates of deposit
$
4,366

 
$
—

 
$
—

 
$
4,366

 
$
15,656

 
$
—

 
$
—

 
$
15,656

Total assets
$
4,366

 
$
—

 
$
—

 
$
4,366

 
$
15,656

 
$
—

 
$
—

 
$
15,656

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities:


 


 


 


 


 


 


 


Contingent acquisition consideration
$
—

 
$
—

 
$
15,415

 
$
15,415

 
$
—

 
$
—

 
$
17,952

 
$
17,952

Total liabilities
$
—

 
$
—

 
$
15,415

 
$
15,415

 
$
—

 
$
—

 
$
17,952

 
$
17,952

Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation 
The following table sets forth a summary of changes in the fair value of our contingent acquisition consideration which represents recurring measurements that are classified within Level 3 of the fair value hierarchy wherein fair value is estimated using significant unobservable inputs (in thousands):
 
March 28, 2015
 
Contingent Acquisition
Consideration
Beginning balance
$
17,952

Contingent consideration liability recorded in connection with Citrus Lane acquisition
—

Increase in fair value included in earnings
308

Reclassification to permanent equity
—

Contingent acquisition consideration payments
(2,845
)
Ending balance
$
15,415

Supplemental Balance Sheet Information (Tables)
Property, Plant and Equipment, net 
The following table presents the detail of property and equipment, net for the periods presented (in thousands):
 
March 28,
2015
 
December 27,
2014
Computer equipment
$
2,603

 
$
2,476

Furniture and fixtures
1,816

 
1,708

Software
1,228

 
1,066

Leasehold improvements
3,736

 
3,137

Total
9,383

 
8,387

Less accumulated depreciation
(2,451
)
 
(2,064
)
Property and equipment, net
$
6,932

 
$
6,323

Schedule of Accrued Liabilities 
The following table presents the detail of accrued expenses and other current liabilities for the periods presented (in thousands):
 
March 28,
2015
 
December 27,
2014
Payroll and compensation
$
3,188

 
$
2,388

Tax-related expense
1,086

 
843

Marketing expenses
4,974

 
3,385

Other accrued expenses
4,077

 
6,116

Total accrued expenses and other current liabilities
$
13,325

 
$
12,732

Goodwill and Intangible Assets (Tables)
Schedule of Goodwill 
The following table presents the change in goodwill for the periods presented (in thousands):
 
CRCM Businesses, Pre-Citrus Lane
 
Citrus Lane
 
Total
Balance as of December 27, 2014
$
60,635

 
$
8,050

 
$
68,685

Effect of currency translation
(2,149
)
 
—

 
(2,149
)
Balance as of March 28, 2015
$
58,486

 
$
8,050

 
$
66,536

 
 
 
 
 
 
Total impairment recognized to date
$
—

 
$
36,227

 
$
36,227

Schedule of Finite-Lived Intangible Assets 
The following table presents the detail of intangible assets for the periods presented (dollars in thousands):
 
Gross Carrying Value
 
Accumulated Amortization
 
Net Carrying Value
 
Weighted-Average Remaining Life (Years)
March 28, 2015
 
 
 
 
 
 
 
Indefinite lived intangibles
$
242

 
$
—

 
$
242

 
N/A
Trademarks and trade names
5,212

 
(3,696
)
 
1,516

 
5.8
Proprietary software
4,737

 
(3,307
)
 
1,430

 
2.3
Website
1,150

 
(79
)
 
1,071

 
6.2
Training materials
30

 
(22
)
 
8

 
0.8
Non-compete agreements
129

 
(95
)
 
34

 
2.0
Leasehold interests
170

 
(67
)
 
103

 
4.1
Caregiver relationships
284

 
(252
)
 
32

 
0.5
Customer relationships
8,776

 
(5,432
)
 
3,344

 
2.8
Total
$
20,730

 
$
(12,950
)
 
$
7,780

 

 
 
 
 
 
 
 
 
December 27, 2014
 
 
 
 
 
 
 
Indefinite lived intangibles
$
242

 
$
—

 
$
242

 
N/A
Trademarks and trade names
5,281

 
(3,377
)
 
1,904

 
5.2
Proprietary software
4,942

 
(3,351
)
 
1,591

 
2.5
Website
1,150

 
(34
)
 
1,116

 
6.5
Training materials
30

 
(20
)
 
10

 
1.0
Non-compete agreements
137

 
(94
)
 
43

 
2.0
Leasehold interests
170

 
(61
)
 
109

 
4.4
Caregiver relationships
312

 
(252
)
 
60

 
0.7
Customer relationships
8,857

 
(4,967
)
 
3,890

 
2.9
Total
$
21,121

 
$
(12,156
)
 
$
8,965

 
 
Schedule of Indefinite-Lived Intangible Assets 
The following table presents the detail of intangible assets for the periods presented (dollars in thousands):
 
Gross Carrying Value
 
Accumulated Amortization
 
Net Carrying Value
 
Weighted-Average Remaining Life (Years)
March 28, 2015
 
 
 
 
 
 
 
Indefinite lived intangibles
$
242

 
$
—

 
$
242

 
N/A
Trademarks and trade names
5,212

 
(3,696
)
 
1,516

 
5.8
Proprietary software
4,737

 
(3,307
)
 
1,430

 
2.3
Website
1,150

 
(79
)
 
1,071

 
6.2
Training materials
30

 
(22
)
 
8

 
0.8
Non-compete agreements
129

 
(95
)
 
34

 
2.0
Leasehold interests
170

 
(67
)
 
103

 
4.1
Caregiver relationships
284

 
(252
)
 
32

 
0.5
Customer relationships
8,776

 
(5,432
)
 
3,344

 
2.8
Total
$
20,730

 
$
(12,950
)
 
$
7,780

 

 
 
 
 
 
 
 
 
December 27, 2014
 
 
 
 
 
 
 
Indefinite lived intangibles
$
242

 
$
—

 
$
242

 
N/A
Trademarks and trade names
5,281

 
(3,377
)
 
1,904

 
5.2
Proprietary software
4,942

 
(3,351
)
 
1,591

 
2.5
Website
1,150

 
(34
)
 
1,116

 
6.5
Training materials
30

 
(20
)
 
10

 
1.0
Non-compete agreements
137

 
(94
)
 
43

 
2.0
Leasehold interests
170

 
(61
)
 
109

 
4.4
Caregiver relationships
312

 
(252
)
 
60

 
0.7
Customer relationships
8,857

 
(4,967
)
 
3,890

 
2.9
Total
$
21,121

 
$
(12,156
)
 
$
8,965

 
 
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense 
As of March 28, 2015, the estimated future amortization expense related to intangible assets for future fiscal years was as follows (in thousands):
2015 remaining
$
2,746

2016
2,200

2017
797

2018
452

2019
395

Thereafter
948

Total
$
7,538

Stockholders’ Equity (Tables)
Schedule of Stock by Class 
As of March 28, 2015, we had reserved the following shares of common stock for future issuance in connection with the following (in thousands):
 
March 28, 2015
 
Contingent consideration payable in common stock
106

 
Options issued and outstanding
3,965

 
Options available for grant under stock option plans
4,493

 
Total
8,564

 
Summary of Stock Option Activity 
A summary of stock option activity for the three months ended March 28, 2015 was as follows (in thousands for shares and intrinsic value):
 
Number of Shares
 
Weighted-Average Remaining Contractual Term (Years)
 
Weighted-Average Exercise Price
 
Aggregate Intrinsic Value
 
 
 
 
 
 
 
 
Outstanding as of December 27, 2014
4,270

 
7.17
 
$
6.47

 
$
14,373

Granted
—

 
 
 
—

 
 
Canceled and forfeited
(166
)
 
 
 
6.64

 
 
Exercised
(138
)
 
 
 
7.76

 
 
Outstanding as of March 28, 2015
3,965

 
7.16
 
$
6.61

 
$
11,872

Options vested and exercisable as of March 28, 2015
2,445

 
6.35
 
$
4.5

 
$
9,943

Options vested and expected to vest as of March 28, 2015 (1)
3,860

 
7.10
 
$
6.48

 
$
11,775

____________________________
(1) Options expected to vest reflect an estimated forfeiture rate
Assumptions Used to Estimate Fair Value of Options Granted 
The following table presents the assumptions used to estimate the fair value of options granted during the periods presented:
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
Risk-free interest rate
N/A
 
1.85 - 2.88%
Expected term (years)
N/A
 
6.25
Volatility
N/A
 
47.1 - 47.3%
Expected dividend yield
N/A
 
—
Summary of Stock-based Compensation in Accompanying Consolidated Statements of Operations 
The following table summarizes stock-based compensation in our accompanying condensed consolidated statements of operations (in thousands):
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
Cost of revenue
$
48

 
$
47

Selling and marketing
161

 
146

Research and development
82

 
89

General and administrative
647

 
817

   Total stock-based compensation
$
938

 
$
1,099

Net Loss Per Share (Tables)
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share
The following equity shares were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented (in thousands):
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
Stock options
3,966

 
3,963

Contingent consideration
106

 
191

Segment and Geographical Information (Tables)
Revenue from External Customers by Product Lines 
Segment information for the three months ended March 28, 2015 and March 29, 2014 was as follows (in thousands):
 
 
Three Months Ended
 
 
March 28, 2015
 
 
CRCM Businesses, Pre-Citrus Lane
 
Citrus Lane
 
Total
Revenue
 
$
32,049

 
$
3,071

 
$
35,120

Adjusted EBITDA
 
(5,604
)
 
(1,458
)
 
(7,062
)
Depreciation and amortization
 
(1,425
)
 
(72
)
 
(1,497
)
Stock based compensation
 
(822
)
 
(116
)
 
(938
)
Other charges
 
(194
)
 
(570
)
 
(764
)
Operating loss
 
(8,045
)
 
(2,216
)
 
(10,261
)
Other expense, net
 
 
 
 
 
(1,191
)
Loss before income taxes
 
 
 
 
 
(11,452
)
Provision for income taxes
 
 
 
 
 
560

Net Loss
 
 
 
 
 
(12,012
)
 
 
Three Months Ended
 
 
March 29, 2014
 
 
CRCM Businesses, Pre-Citrus Lane
 
Citrus Lane
 
Total
Revenue
 
$
25,271

 
$
—

 
$
25,271

Adjusted EBITDA
 
(9,649
)
 
—

 
(9,649
)
Depreciation and amortization
 
(1,261
)
 
—

 
(1,261
)
Stock based compensation
 
(1,099
)
 
—

 
(1,099
)
Other charges
 
(304
)
 
—

 
(304
)
Operating loss
 
(12,313
)
 
—

 
(12,313
)
Other expense, net
 
 
 
 
 
(2,746
)
Loss before income taxes
 
 
 
 
 
(15,059
)
Provision for income taxes
 
 
 
 
 
485

Net Loss
 
 
 
 
 
(15,544
)
Schedule of Revenue by Geographic Location 
The following table summarizes total revenue generated by our geographic locations (dollars in thousands):
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
United States
$
32,855

 
$
23,492

International
2,265

 
1,779

Total revenue
$
35,120

 
$
25,271

 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
 
(As a percentage of revenue)
United States
94
%
 
93
%
International
6
%
 
7
%
Total revenue
100
%
 
100
%
Other Expense, Net (Tables)
Schedule of Other Expense, Net
Other expense, net consisted of the following (in thousands):
 
Three Months Ended
 
March 28,
2015
 
March 29,
2014
Interest income
$
34

 
$
20

Interest expense
(28
)
 
(7
)
Other expense, net
(1,197
)
 
(2,759
)
Total other expense, net
$
(1,191
)
 
$
(2,746
)
Description of Business and Summary of Significant Accounting Policies - Additional Information (Details)
3 Months Ended
Mar. 28, 2015
Minimum
 
Entity Information [Line Items]
 
Fiscal period duration
364 days 
Maximum
 
Entity Information [Line Items]
 
Fiscal period duration
371 days 
Fair Value Measurements - Assets and Liabilities Measured on a Recurring Basis (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 28, 2015
Dec. 27, 2014
Assets:
 
 
Total assets
$ 4,366 
$ 15,656 
Liabilities:
 
 
Total liabilities
15,415 
17,952 
Money Market Funds
 
 
Assets:
 
 
Money market mutual funds and certificates of deposit
4,366 
15,656 
Level 1
 
 
Assets:
 
 
Total assets
4,366 
15,656 
Liabilities:
 
 
Total liabilities
0 
0 
Level 1 |
Money Market Funds
 
 
Assets:
 
 
Money market mutual funds and certificates of deposit
4,366 
15,656 
Level 2
 
 
Assets:
 
 
Total assets
0 
0 
Liabilities:
 
 
Total liabilities
0 
0 
Level 2 |
Money Market Funds
 
 
Assets:
 
 
Money market mutual funds and certificates of deposit
0 
0 
Level 3
 
 
Assets:
 
 
Total assets
0 
0 
Liabilities:
 
 
Total liabilities
15,415 
17,952 
Level 3 |
Money Market Funds
 
 
Assets:
 
 
Money market mutual funds and certificates of deposit
0 
0 
Contingent acquisition consideration
 
 
Liabilities:
 
 
Contingent acquisition consideration
15,415 
17,952 
Contingent acquisition consideration |
Level 1
 
 
Liabilities:
 
 
Contingent acquisition consideration
0 
0 
Contingent acquisition consideration |
Level 2
 
 
Liabilities:
 
 
Contingent acquisition consideration
0 
0 
Contingent acquisition consideration |
Level 3
 
 
Liabilities:
 
 
Contingent acquisition consideration
$ 15,415 
$ 17,952 
Fair Value Measurements - Contingent Consideration - Recurring Measurements Classified as Level 3 (Details) (Contingent Acquisition Consideration, USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Contingent Acquisition Consideration
 
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
 
Beginning balance
$ 17,952 
Contingent consideration liability recorded in connection with Citrus Lane acquisition
0 
Increase in fair value included in earnings
308 
Reclassification to permanent equity
0 
Contingent acquisition consideration payments
(2,845)
Ending balance
$ 15,415 
Supplemental Balance Sheet Information - Property, Plant and Equipment, net (Details) (USD $)
3 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Dec. 27, 2014
Property, Plant and Equipment [Line Items]
 
 
 
Property, plant and equipment, gross
$ 9,383,000 
 
$ 8,387,000 
Less accumulated depreciation
(2,451,000)
 
(2,064,000)
Property and equipment, net
6,932,000 
 
6,323,000 
Depreciation
400,000 
200,000 
 
Computer equipment
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, plant and equipment, gross
2,603,000 
 
2,476,000 
Furniture and fixtures
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, plant and equipment, gross
1,816,000 
 
1,708,000 
Software
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, plant and equipment, gross
1,228,000 
 
1,066,000 
Leasehold improvements
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, plant and equipment, gross
$ 3,736,000 
 
$ 3,137,000 
Supplemental Balance Sheet Information - Accrued Expenses and Other Current Liabilities (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 28, 2015
Dec. 27, 2014
Balance Sheet Related Disclosures [Abstract]
 
 
Payroll and compensation
$ 3,188 
$ 2,388 
Tax-related expense
1,086 
843 
Marketing expenses
4,974 
3,385 
Other accrued expenses
4,077 
6,116 
Total accrued expenses and other current liabilities
$ 13,325 
$ 12,732 
Goodwill and Intangible Assets - Change in Goodwill (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Goodwill
 
Balance as of December 27, 2014
$ 68,685 
Effect of currency translation
(2,149)
Balance as of March 28, 2015
66,536 
Total impairment recognized to date
36,227 
CRCM Businesses, Pre-Citrus Lane
 
Goodwill
 
Balance as of December 27, 2014
60,635 
Effect of currency translation
(2,149)
Balance as of March 28, 2015
58,486 
Total impairment recognized to date
0 
Citrus Lane
 
Goodwill
 
Balance as of December 27, 2014
8,050 
Effect of currency translation
0 
Balance as of March 28, 2015
8,050 
Total impairment recognized to date
$ 36,227 
Goodwill and Intangible Assets - Intangible Assets (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Mar. 28, 2015
Dec. 27, 2014
Goodwill and Intangible Assets Disclosure [Abstract]
 
 
Indefinite lived intangibles
$ 242 
$ 242 
Finite-Lived Intangible Assets [Line Items]
 
 
Accumulated Amortization
(12,950)
(12,156)
Net Carrying Value
7,538 
 
Total Gross Carrying Value
20,730 
21,121 
Total Accumulated Amortization
(12,950)
(12,156)
Total Net Carrying Value
7,780 
8,965 
Trademarks and trade names
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Value
5,212 
5,281 
Accumulated Amortization
(3,696)
(3,377)
Net Carrying Value
1,516 
1,904 
Total Accumulated Amortization
(3,696)
(3,377)
Weighted-Average Remaining Life
5 years 10 months 
5 years 2 months 
Proprietary software
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Value
4,737 
4,942 
Accumulated Amortization
(3,307)
(3,351)
Net Carrying Value
1,430 
1,591 
Total Accumulated Amortization
(3,307)
(3,351)
Weighted-Average Remaining Life
2 years 3 months 
2 years 6 months 
Website
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Value
1,150 
1,150 
Accumulated Amortization
(79)
(34)
Net Carrying Value
1,071 
1,116 
Total Accumulated Amortization
(79)
(34)
Weighted-Average Remaining Life
6 years 2 months 
6 years 6 months 
Training materials
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Value
30 
30 
Accumulated Amortization
(22)
(20)
Net Carrying Value
8 
10 
Total Accumulated Amortization
(22)
(20)
Weighted-Average Remaining Life
10 months 
1 year 0 months 
Non-compete agreements
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Value
129 
137 
Accumulated Amortization
(95)
(94)
Net Carrying Value
34 
43 
Total Accumulated Amortization
(95)
(94)
Weighted-Average Remaining Life
2 years 0 months 
2 years 0 months 
Leasehold interests
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Value
170 
170 
Accumulated Amortization
(67)
(61)
Net Carrying Value
103 
109 
Total Accumulated Amortization
(67)
(61)
Weighted-Average Remaining Life
4 years 1 month 
4 years 5 months 
Caregiver relationships
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Value
284 
312 
Accumulated Amortization
(252)
(252)
Net Carrying Value
32 
60 
Total Accumulated Amortization
(252)
(252)
Weighted-Average Remaining Life
6 months 
8 months 
Customer relationships
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross Carrying Value
8,776 
8,857 
Accumulated Amortization
(5,432)
(4,967)
Net Carrying Value
3,344 
3,890 
Total Accumulated Amortization
$ (5,432)
$ (4,967)
Weighted-Average Remaining Life
2 years 9 months 
2 years 11 months 
Goodwill and Intangible Assets - Intangible Assets - Future Amortization (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 28, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
 
2015
$ 2,746 
2016
2,200 
2017
797 
2018
452 
2019
395 
Thereafter
948 
Net Carrying Value
$ 7,538 
Goodwill and Intangible Assets - Additional Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Finite-Lived Intangible Assets [Line Items]
 
 
Amortization of intangible assets
$ 1.1 
$ 1.1 
Depreciation and Amortization
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Amortization of intangible assets
0.9 
0.9 
Cost of revenue
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Amortization of intangible assets
$ 0.2 
$ 0.2 
Stockholders’ Equity - Additional Information (Details) (USD $)
In Millions, except Share data, unless otherwise specified
0 Months Ended 3 Months Ended
Jan. 29, 2014
Mar. 28, 2015
Dec. 27, 2014
Class of Stock [Line Items]
 
 
 
Share price (usd per share)
 
 
$ 7.93 
Offering Expenses
$ 2.4 
 
 
Intrinsic value of options exercised
 
0.8 
 
The aggregate fair value of the options vested
 
1.1 
 
Common Stock
 
 
 
Class of Stock [Line Items]
 
 
 
Shares of common stock
6,152,500 
 
 
Shares of common stock sold, underwriters Issued
802,500 
 
 
Share price (usd per share)
$ 17.00 
 
 
Preferred Stock
 
 
 
Class of Stock [Line Items]
 
 
 
Convertible preferred stock warrants
21,490,656 
 
 
Common Stock
 
 
 
Class of Stock [Line Items]
 
 
 
Series A-1 Convertible preferred stock
40,697 
 
 
Exercise price (usd per share)
$ 1.72 
 
 
Employee Stock Option
 
 
 
Class of Stock [Line Items]
 
 
 
Unrecognized compensation cost
 
 
7.2 
Unrecognized compensation cost, period for recognition
 
2 years 4 months 25 days 
 
2014 Plan
 
 
 
Class of Stock [Line Items]
 
 
 
Shares available for grant
 
 
4,492,737 
Additional Paid-In Capital
 
 
 
Class of Stock [Line Items]
 
 
 
Net proceeds from issuance of common stock upon initial public offering
$ 94.8 
 
 
Stockholders’ Equity - Shares Reserved for Issuance (Details)
In Thousands, unless otherwise specified
Mar. 28, 2015
Dec. 27, 2014
Class of Stock [Line Items]
 
 
Total shares of common stock reserved for future issuance
8,564 
 
Options issued and outstanding
3,965 
4,270 
Employee Stock Options, Available for Issuance
 
 
Class of Stock [Line Items]
 
 
Total shares of common stock reserved for future issuance
4,493 
 
Convertible Common Stock, Series E |
Contingent acquisition consideration
 
 
Class of Stock [Line Items]
 
 
Total shares of common stock reserved for future issuance
106 
 
Stockholders’ Equity - Summary of Stock Activity (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Mar. 28, 2015
Dec. 27, 2014
Number of Shares
 
 
Options outstanding, beginning balance
4,270 
 
Granted
0 
 
Canceled and forfeited
(166)
 
Exercised
(138)
 
Options outstanding, ending balance
3,965 
4,270 
Options vested and exercisable at end of period
2,445 
 
Options vested and expected to vest at end of period
3,860 
 
Weighted-Average Exercise Price (usd per share)
 
 
Options, outstanding, weighted average exercise price, beginning of period
$ 6.47 
 
Granted
$ 0.00 
 
Canceled and forfeited
$ 6.64 
 
Exercised
$ 7.76 
 
Options, outstanding, weighted average exercise price, end of period
$ 6.61 
$ 6.47 
Options vested and exercisable, weighted average exercise price (usd per share)
$ 4.50 
 
Options vested and expected to vest, weighted average exercise price (usd per share)
$ 6.48 
 
Stock Options, Additional Disclosures
 
 
Options outstanding, weighted average remaining contractual term, beginning of period
7 years 1 month 27 days 
7 years 1 month 30 days 
Options outstanding, weighted average remaining contractual term, end of period
7 years 1 month 27 days 
7 years 1 month 30 days 
Options, outstanding, aggregate intrinsic value, beginning of period
$ 14,373 
 
Options, outstanding, aggregate intrinsic value, end of period
11,872 
14,373 
Options vested and exercisable at end of period, Weighted Average Remaining Contractual Term
6 years 1 month 99 days 
 
Options vested and expected to vest at end of period, Weighted Average Remaining Contractual Term
7 years 1 month 5 days 
 
Options vested and exercisable at end of period, Aggregate Intrinsic Value
9,943 
 
Options vested and expected to vest at end of period, Aggregate Intrinsic Value
$ 11,775 
 
Stockholders’ Equity - Stock Options, Valuation Assumptions (Details)
3 Months Ended
Mar. 29, 2014
Equity [Abstract]
 
Expected dividend yield
0.00% 
Risk-free interest rate, minimum
1.85% 
Risk-free interest rate, maximum
2.88% 
Expected term (years)
6 years 2 months 30 days 
Volatility, minimum
47.10% 
Volatility, maximum
47.30% 
Stockholders’ Equity - Summary of Stock-based Compensation in Accompanying Consolidated Statements (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Stock-based compensation
$ 938 
$ 1,099 
Cost of revenue
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Stock-based compensation
48 
47 
Selling and marketing
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Stock-based compensation
161 
146 
Research and development
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Stock-based compensation
82 
89 
General and administrative
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Stock-based compensation
$ 647 
$ 817 
Net Loss Per Share - Antidilutive Securities (Details)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Stock options
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
Antidilutive securities (shares)
3,966 
3,963 
Performance Shares
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
Antidilutive securities (shares)
106 
191 
Income Taxes - Additional Information (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Income Tax Disclosure [Abstract]
 
 
Income tax expense
$ 560 
$ 485 
Segment and Geographical Information - Revenue by Segment (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Segment Reporting Information [Line Items]
 
 
Revenue
$ 35,120 
$ 25,271 
Adjusted EBITDA
(7,062)
(9,649)
Depreciation and amortization
(1,497)
(1,261)
Stock based compensation
(938)
(1,099)
Other charges
(764)
(304)
Operating loss
(10,261)
(12,313)
Other expense, net
(1,191)
(2,746)
Loss before income taxes
(11,452)
(15,059)
Income tax expense
560 
485 
Net Income (Loss) Attributable to Parent
(12,012)
(15,544)
CRCM Businesses, Pre-Citrus Lane
 
 
Segment Reporting Information [Line Items]
 
 
Revenue
32,049 
25,271 
Adjusted EBITDA
(5,604)
(9,649)
Depreciation and amortization
(1,425)
(1,261)
Stock based compensation
(822)
(1,099)
Other charges
(194)
(304)
Operating loss
(8,045)
(12,313)
Citrus Lane
 
 
Segment Reporting Information [Line Items]
 
 
Revenue
3,071 
0 
Adjusted EBITDA
(1,458)
0 
Depreciation and amortization
(72)
0 
Stock based compensation
(116)
0 
Other charges
(570)
0 
Operating loss
$ (2,216)
$ 0 
Segment and Geographical Information - Revenue by Geographic Location (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended 3 Months Ended 12 Months Ended 3 Months Ended 12 Months Ended 3 Months Ended 12 Months Ended 3 Months Ended 12 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Mar. 28, 2015
Geographic Concentration
Revenue
Dec. 27, 2014
Geographic Concentration
Revenue
Mar. 28, 2015
United States
Dec. 27, 2014
United States
Mar. 28, 2015
United States
Geographic Concentration
Revenue
Dec. 27, 2014
United States
Geographic Concentration
Revenue
Mar. 28, 2015
International
Dec. 27, 2014
International
Mar. 28, 2015
International
Geographic Concentration
Revenue
Dec. 27, 2014
International
Geographic Concentration
Revenue
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Total revenue
$ 35,120 
$ 25,271 
 
 
$ 32,855 
$ 23,492 
 
 
$ 2,265 
$ 1,779 
 
 
Percentage of total revenue
 
 
100.00% 
100.00% 
 
 
94.00% 
93.00% 
 
 
6.00% 
7.00% 
Segment and Geographical Information - Additional Information (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Segment
Dec. 27, 2014
Segment Reporting Information [Line Items]
 
 
Number of operating segments
2 
 
Number of reportable segments
2 
 
Assets
$ 162,056 
$ 173,104 
CRCM Businesses, Pre-Citrus Lane
 
 
Segment Reporting Information [Line Items]
 
 
Assets
153,200 
163,100 
Citrus Lane
 
 
Segment Reporting Information [Line Items]
 
 
Assets
$ 8,900 
$ 10,000 
Other Expense, Net (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 28, 2015
Mar. 29, 2014
Other Income and Expenses [Abstract]
 
 
Interest income
$ 34 
$ 20 
Interest expense
(28)
(7)
Other expense, net
(1,197)
(2,759)
Total other expense, net
$ (1,191)
$ (2,746)