|
|
|
|
|
|
|
|
(in thousands) | June 30, 2014 | December 31, 2013 | |||||
Components | $ | 3,754 | $ | 8,000 | |||
Finished goods | 76,622 | 103,994 | |||||
Total inventory, net | $ | 80,376 | $ | 111,994 |
(in thousands) | June 30, 2014 | December 31, 2013 | |||||
Prepaid expenses | $ | 28,239 | $ | 3,830 | |||
Non-trade receivables | 19,963 | 144 | |||||
Current deferred tax assets | 14,984 | 15,173 | |||||
Other current assets | 2,223 | 2,820 | |||||
Total prepaid expenses and other current assets | $ | 65,409 | $ | 21,967 |
(in thousands) | Useful life (in years) | June 30, 2014 | December 31, 2013 | ||||||
Leasehold improvements | 3–7 | $ | 22,247 | $ | 20,111 | ||||
Computers, software, equipment and furniture | 2–7 | 19,697 | 11,988 | ||||||
Tooling | 1–4 | 11,317 | 8,799 | ||||||
Tradeshow equipment and other | 2–5 | 3,759 | 3,469 | ||||||
Construction in progress | 2,650 | 2,151 | |||||||
59,670 | 46,518 | ||||||||
Less: Accumulated depreciation | (20,731) | (14,407) | |||||||
$ | 38,939 | $ | 32,111 |
Weighted average remaining useful life (in years) | |||||||||||||
June 30, 2014 | |||||||||||||
(in thousands) | Gross | Accumulated amortization | Net | ||||||||||
Developed technology | $ | 5,330 | $ | (2,961 | ) | $ | 2,369 | 2.7 | |||||
Other intangible assets | 1,160 | (819 | ) | 341 | 1.6 | ||||||||
$ | 6,490 | $ | (3,780 | ) | $ | 2,710 |
Weighted average remaining useful life (in years) | |||||||||||||
December 31, 2013 | |||||||||||||
(in thousands) | Gross | Accumulated amortization | Net | ||||||||||
Developed technology | $ | 5,330 | $ | (2,517 | ) | $ | 2,813 | 3.2 | |||||
Other intangible assets | 1,160 | (703 | ) | 457 | 2.0 | ||||||||
$ | 6,490 | $ | (3,220 | ) | $ | 3,270 |
(in thousands) | Cost of revenue | Operating expenses | Total | ||||||||
Years ending December 31, | |||||||||||
2014 (remaining 6 months) | $ | 444 | $ | 107 | $ | 551 | |||||
2015 | 888 | 197 | 1,085 | ||||||||
2016 | 888 | 22 | 910 | ||||||||
2017 | 149 | — | 149 | ||||||||
$ | 2,369 | $ | 326 | $ | 2,695 |
(in thousands) | June 30, 2014 | December 31, 2013 | |||||
POP displays | $ | 19,077 | $ | 22,379 | |||
Deposits | 4,999 | 2,698 | |||||
Long-term licenses | 4,000 | 4,000 | |||||
Long-term deferred tax assets and other | 2,320 | 1,683 | |||||
Deferred public offering costs | 6,166 | 1,395 | |||||
Total other long-term assets | $ | 36,562 | $ | 32,155 |
(in thousands) | June 30, 2014 | December 31, 2013 | |||||
Accrued payables | $ | 39,778 | $ | 49,975 | |||
Employee related liabilities | 12,571 | 11,932 | |||||
Customer deposits | 1,736 | 1,316 | |||||
Warranty liability | 4,512 | 3,691 | |||||
Taxes payable | 11,211 | 7,766 | |||||
Accrued sponsorship expense | 2,191 | 2,909 | |||||
Accrued sales incentives | 3,579 | 4,909 | |||||
Sales commissions | 1,608 | 2,454 | |||||
Other | 1,633 | 1,439 | |||||
Total accrued liabilities | $ | 78,819 | $ | 86,391 |
|
|
(in thousands) | June 30, 2014 | December 31, 2013 | |||
Stock options outstanding | 27,294 | 26,724 | |||
Restricted stock units outstanding | 3,820 | 270 | |||
Stock options, restricted stock and RSUs available for future grants | 13,821 | 1,306 | |||
44,935 | 28,300 |
Options outstanding | |||||||||||||||||||||
(shares in thousands) | Shares | Weighted- average exercise price | Weighted- average grant date fair value | Total intrinsic value of options exercised (in thousands) | Weighted- average remaining contractual term (in years) | Aggregate intrinsic value (in thousands) | |||||||||||||||
Outstanding at December 31, 2013: | 26,724 | $ | 2.47 | 7.55 | $ | 367,395 | |||||||||||||||
Granted | 4,635 | 17.57 | $ | 9.35 | |||||||||||||||||
Exercised | (3,835 | ) | 0.88 | $ | 80,108 | ||||||||||||||||
Forfeited/Cancelled | (230 | ) | 11.58 | ||||||||||||||||||
Outstanding at June 30, 2014: | 27,294 | $ | 5.18 | 7.60 | $ | 965,340 | |||||||||||||||
Exercisable at December 31, 2013 | 20,605 | $ | 0.84 | 7.26 | $ | 316,812 | |||||||||||||||
Vested and expected to vest at December 31, 2013 | 25,798 | $ | 2.32 | 7.52 | $ | 358,624 | |||||||||||||||
Exercisable at June 30, 2014 | 18,594 | $ | 1.19 | 6.90 | $ | 731,810 | |||||||||||||||
Vested and expected to vest at June 30, 2014 | 26,076 | $ | 4.84 | 7.54 | $ | 931,254 |
Options outstanding | Options exercisable | ||||||||||||||
(options in thousands) | Options outstanding | Weighted average remaining contractual life (in years) | Weighted average exercise price | Options exercisable | Weighted average exercise price | ||||||||||
Range of exercise prices | |||||||||||||||
$ 0.18–0.66 | 8,944 | 6.62 | $ | 0.62 | 8,736 | $ | 0.62 | ||||||||
0.76–0.76 | 8,752 | 6.97 | 0.76 | 8,133 | 0.76 | ||||||||||
1.52–2.96 | 1,795 | 7.56 | 1.91 | 1,031 | 1.86 | ||||||||||
8.30–8.30 | 513 | 8.30 | 8.30 | 218 | 8.30 | ||||||||||
13.72–13.72 | 873 | 8.65 | 13.72 | 294 | 13.72 | ||||||||||
15.40–15.40 | 584 | 8.94 | 15.40 | 171 | 15.40 | ||||||||||
15.59–15.59 | 444 | 9.15 | 15.59 | 1 | 15.59 | ||||||||||
16.19–16.19 | 797 | 9.39 | 16.19 | — | — | ||||||||||
16.22–16.22 | 1,125 | 9.59 | 16.22 | — | — | ||||||||||
16.39–16.39 | 651 | 9.78 | 16.39 | 10 | 16.39 | ||||||||||
18.40–18.40 | 2,816 | 9.93 | 18.40 | — | — | ||||||||||
$ 0.18–18.40 | 27,294 | 7.60 | $ | 5.18 | 18,594 | $ | 1.19 |
(in thousands except for weighted average grant date fair value) | Shares | Weighted- average grant date fair value | Aggregate intrinsic value | |||||||
Non-vested shares at December 31, 2013 | 487 | $ | 11.03 | $ | 7,628 | |||||
Granted | — | |||||||||
Vested | (152 | ) | ||||||||
Non-vested shares at June 30, 2014 | 335 | $ | 12.73 | $ | 13,461 |
(in thousands except for weighted average grant date fair value) | Shares | Weighted- average grant date fair value | ||||
Non-vested shares at December 31, 2013 | 270 | $ | 1.52 | |||
Granted | 5,050 | 16.66 | ||||
Vested | (1,500 | ) | 18.40 | |||
Non-vested shares at June 30, 2014 | 3,820 | 14.91 |
Dividend yield | None |
Expected volatility | 50.9% |
Risk-free interest rate | 2.69% |
Expected term (years) | 10 |
Grant date fair value of underlying shares | $18.40 |
• | In March 2011, the Company paid the employee $6.1 million in cash, which was recorded as compensation expense within sales and marketing expense. Also in March 2011, the CEO reimbursed the Company for $6.1 million, which was recorded as a stockholder contribution to additional paid-in capital; |
• | In June 2011, the Company issued the employee an option to purchase 6,584,427 shares of common stock at an exercise price of $0.763 per share. The option vested immediately and has a contractual life of 10 years. Stock compensation expense of $6.8 million was recorded in June 2011 within sales and marketing expense as a result of this grant. Upon exercise of this option by the employee, the founder and CEO will contribute an equal number of common shares back to the Company. In June 2014, the employee exercised the option to purchase 665,443 shares, for which the CEO contributed the same number of shares back to the Company; and |
• | In December 2011, the Company issued the employee 270,000 RSUs that vest upon a change in control of the Company. |
Three months ended | Six months ended | ||||||||||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||||||||||
Stock-based compensation expense: | |||||||||||||||
Cost of revenue | $ | 154 | $ | 157 | $ | 322 | $ | 377 | |||||||
Research and development | 1,657 | 556 | 3,058 | 997 | |||||||||||
Sales and marketing | 1,654 | 1,454 | 3,068 | 2,658 | |||||||||||
General and administrative | 30,728 | 365 | 31,782 | 595 | |||||||||||
Total stock-based compensation expense | 34,193 | 2,532 | 38,230 | 4,627 | |||||||||||
Total tax benefit recognized | (11,483 | ) | (203 | ) | (11,825 | ) | (546 | ) | |||||||
Decrease in net income | $ | 22,710 | $ | 2,329 | $ | 26,405 | $ | 4,081 | |||||||
Stock-based compensation expense by type of award: | |||||||||||||||
Stock options | $ | 3,487 | $ | 2,027 | $ | 6,380 | $ | 3,650 | |||||||
RSUs | 29,313 | — | 29,493 | — | |||||||||||
Restricted stock | 1,352 | 505 | 2,316 | 977 | |||||||||||
ESPP | 41 | — | 41 | — | |||||||||||
Total stock-based compensation expense | 34,193 | 2,532 | 38,230 | 4,627 | |||||||||||
Total tax benefit recognized | (11,483 | ) | (203 | ) | (11,825 | ) | (546 | ) | |||||||
Decrease in net income | $ | 22,710 | $ | 2,329 | $ | 26,405 | $ | 4,081 |
Three months ended | Six months ended | ||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||
Dividend yield | None | None | None | None | |||
Expected volatility | 53.9% | 59.8% | 53.9% - 56.0% | 56.0% - 59.8% | |||
Risk-free interest rate | 1.7% - 1.9% | 0.8% - 1.6% | 1.7% - 2.0% | 0.8% - 1.6% | |||
Expected term (years) | 5.3 - 6.1 | 5.3 - 6.1 | 5.3 - 6.3 | 5.3 - 6.1 | |||
Estimated annual forfeiture rate | 6.0% | 6.0% | 6.0% | 6.0% | |||
Weighted average fair value at grant date | $9.63 | $8.64 | $9.35 | $7.92 |
Three months ended | |
June 30, 2014 | |
Dividend yield | None |
Expected volatility | 45.5% |
Risk-free interest rate | 0.1% |
Expected term (years) | 0.6 |
Weighted average fair value at purchase date | $7.04 |
|
Three months ended | Six months ended | ||||||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||||||
Income tax (benefit) expense | 1,639 | (2,568 | ) | 5,521 | 7,459 | ||||||
Effective tax rate | (9.0 | )% | 33.6 | % | (168.8 | )% | 29.4 | % |
|
|
|
(in thousands) | Total | 1 year (remaining 6 months fiscal 2014) | 2-3 years (fiscal 2015 and 2016) | 4-5 years (fiscal 2017 and 2018) | More than 5 years (beyond fiscal 2018) | ||||||||||||||
Term loan principal and interest(1) | $ | 112,340 | $ | 57,419 | $ | 54,921 | $ | — | $ | — | |||||||||
Operating leases(2) | 29,459 | 4,332 | 13,829 | 10,705 | 593 | ||||||||||||||
Sponsorship commitments(3) | 17,851 | 4,929 | 12,621 | 301 | — | ||||||||||||||
Other contractual commitments(4) | 3,937 | 232 | 3,705 | — | — | ||||||||||||||
Capital equipment purchase commitments(5) | 12,242 | 12,242 | — | — | — | ||||||||||||||
Total contractual cash obligations | $ | 175,829 | $ | 79,154 | $ | 85,076 | $ | 11,006 | $ | 593 |
(1) | See Note 8, “Financing arrangements.” Interest payments were calculated using the applicable rate as of June 30, 2014. |
(2) | The Company leases its facilities under long-term operating leases, which expire at various dates through May 2019. The lease agreements frequently include leasehold improvement incentives, escalating lease payments, renewal provisions and other provisions which require the Company to pay taxes, insurance, maintenance costs or defined rent increases. |
(3) | The Company sponsors sporting events and athletes as part of its marketing efforts. In many cases, the Company enters into multi-year agreements with event organizers and athletes. |
(4) | The Company purchases software licenses and engages outside consultants to assist with upgrading or implementing its financial and IT systems, which require payments over multiple years. |
(5) | The Company enters into contracts to acquire equipment for tooling and molds as part of its manufacturing operations. In addition, the Company incurs purchase commitments related to the manufacturing of its POP displays by third parties. |
Three months ended | Six months ended | ||||||||||||||
(in thousands) | June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | |||||||||||
Beginning balances | $ | 2,551 | $ | 2,695 | $ | 3,870 | $ | 1,937 | |||||||
Charged to cost of revenue | 3,928 | 1,291 | 4,200 | 3,119 | |||||||||||
Settlements of warranty claims | (1,801 | ) | (1,169 | ) | (3,392 | ) | (2,239 | ) | |||||||
Ending balances | $ | 4,678 | $ | 2,817 | $ | 4,678 | $ | 2,817 |
|
|
June 30, 2014 | December 31, 2013 | ||
Customer A | 20% | 21% | |
Customer B | 12% | 14% | |
Customer C | * | 11% |
Three months ended | Six months ended | ||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||
Customer A | 17% | 15% | 15% | 14% | |||
Customer B | * | 10% | * | * |
* | Less than 10% of total revenue for the period indicated |
Three months ended | Six months ended | ||||||||||||||
(in thousands) | June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | |||||||||||
Americas | $ | 152,710 | $ | 102,017 | $ | 277,876 | $ | 235,491 | |||||||
Europe, Middle East and Africa | 62,832 | 58,925 | 142,939 | 146,708 | |||||||||||
Asia and Pacific area countries | 29,063 | 16,140 | 59,506 | 49,940 | |||||||||||
$ | 244,605 | $ | 177,082 | $ | 480,321 | $ | 432,139 |
|
|
|
(in thousands) | June 30, 2014 | December 31, 2013 | |||||
Components | $ | 3,754 | $ | 8,000 | |||
Finished goods | 76,622 | 103,994 | |||||
Total inventory, net | $ | 80,376 | $ | 111,994 |
(in thousands) | June 30, 2014 | December 31, 2013 | |||||
Prepaid expenses | $ | 28,239 | $ | 3,830 | |||
Non-trade receivables | 19,963 | 144 | |||||
Current deferred tax assets | 14,984 | 15,173 | |||||
Other current assets | 2,223 | 2,820 | |||||
Total prepaid expenses and other current assets | $ | 65,409 | $ | 21,967 |
(in thousands) | Useful life (in years) | June 30, 2014 | December 31, 2013 | ||||||
Leasehold improvements | 3–7 | $ | 22,247 | $ | 20,111 | ||||
Computers, software, equipment and furniture | 2–7 | 19,697 | 11,988 | ||||||
Tooling | 1–4 | 11,317 | 8,799 | ||||||
Tradeshow equipment and other | 2–5 | 3,759 | 3,469 | ||||||
Construction in progress | 2,650 | 2,151 | |||||||
59,670 | 46,518 | ||||||||
Less: Accumulated depreciation | (20,731) | (14,407) | |||||||
$ | 38,939 | $ | 32,111 |
Weighted average remaining useful life (in years) | |||||||||||||
June 30, 2014 | |||||||||||||
(in thousands) | Gross | Accumulated amortization | Net | ||||||||||
Developed technology | $ | 5,330 | $ | (2,961 | ) | $ | 2,369 | 2.7 | |||||
Other intangible assets | 1,160 | (819 | ) | 341 | 1.6 | ||||||||
$ | 6,490 | $ | (3,780 | ) | $ | 2,710 |
Weighted average remaining useful life (in years) | |||||||||||||
December 31, 2013 | |||||||||||||
(in thousands) | Gross | Accumulated amortization | Net | ||||||||||
Developed technology | $ | 5,330 | $ | (2,517 | ) | $ | 2,813 | 3.2 | |||||
Other intangible assets | 1,160 | (703 | ) | 457 | 2.0 | ||||||||
$ | 6,490 | $ | (3,220 | ) | $ | 3,270 |
(in thousands) | Cost of revenue | Operating expenses | Total | ||||||||
Years ending December 31, | |||||||||||
2014 (remaining 6 months) | $ | 444 | $ | 107 | $ | 551 | |||||
2015 | 888 | 197 | 1,085 | ||||||||
2016 | 888 | 22 | 910 | ||||||||
2017 | 149 | — | 149 | ||||||||
$ | 2,369 | $ | 326 | $ | 2,695 |
(in thousands) | June 30, 2014 | December 31, 2013 | |||||
POP displays | $ | 19,077 | $ | 22,379 | |||
Deposits | 4,999 | 2,698 | |||||
Long-term licenses | 4,000 | 4,000 | |||||
Long-term deferred tax assets and other | 2,320 | 1,683 | |||||
Deferred public offering costs | 6,166 | 1,395 | |||||
Total other long-term assets | $ | 36,562 | $ | 32,155 |
(in thousands) | June 30, 2014 | December 31, 2013 | |||||
Accrued payables | $ | 39,778 | $ | 49,975 | |||
Employee related liabilities | 12,571 | 11,932 | |||||
Customer deposits | 1,736 | 1,316 | |||||
Warranty liability | 4,512 | 3,691 | |||||
Taxes payable | 11,211 | 7,766 | |||||
Accrued sponsorship expense | 2,191 | 2,909 | |||||
Accrued sales incentives | 3,579 | 4,909 | |||||
Sales commissions | 1,608 | 2,454 | |||||
Other | 1,633 | 1,439 | |||||
Total accrued liabilities | $ | 78,819 | $ | 86,391 |
|
(in thousands) | June 30, 2014 | December 31, 2013 | |||
Stock options outstanding | 27,294 | 26,724 | |||
Restricted stock units outstanding | 3,820 | 270 | |||
Stock options, restricted stock and RSUs available for future grants | 13,821 | 1,306 | |||
44,935 | 28,300 |
Options outstanding | |||||||||||||||||||||
(shares in thousands) | Shares | Weighted- average exercise price | Weighted- average grant date fair value | Total intrinsic value of options exercised (in thousands) | Weighted- average remaining contractual term (in years) | Aggregate intrinsic value (in thousands) | |||||||||||||||
Outstanding at December 31, 2013: | 26,724 | $ | 2.47 | 7.55 | $ | 367,395 | |||||||||||||||
Granted | 4,635 | 17.57 | $ | 9.35 | |||||||||||||||||
Exercised | (3,835 | ) | 0.88 | $ | 80,108 | ||||||||||||||||
Forfeited/Cancelled | (230 | ) | 11.58 | ||||||||||||||||||
Outstanding at June 30, 2014: | 27,294 | $ | 5.18 | 7.60 | $ | 965,340 | |||||||||||||||
Exercisable at December 31, 2013 | 20,605 | $ | 0.84 | 7.26 | $ | 316,812 | |||||||||||||||
Vested and expected to vest at December 31, 2013 | 25,798 | $ | 2.32 | 7.52 | $ | 358,624 | |||||||||||||||
Exercisable at June 30, 2014 | 18,594 | $ | 1.19 | 6.90 | $ | 731,810 | |||||||||||||||
Vested and expected to vest at June 30, 2014 | 26,076 | $ | 4.84 | 7.54 | $ | 931,254 |
Options outstanding | Options exercisable | ||||||||||||||
(options in thousands) | Options outstanding | Weighted average remaining contractual life (in years) | Weighted average exercise price | Options exercisable | Weighted average exercise price | ||||||||||
Range of exercise prices | |||||||||||||||
$ 0.18–0.66 | 8,944 | 6.62 | $ | 0.62 | 8,736 | $ | 0.62 | ||||||||
0.76–0.76 | 8,752 | 6.97 | 0.76 | 8,133 | 0.76 | ||||||||||
1.52–2.96 | 1,795 | 7.56 | 1.91 | 1,031 | 1.86 | ||||||||||
8.30–8.30 | 513 | 8.30 | 8.30 | 218 | 8.30 | ||||||||||
13.72–13.72 | 873 | 8.65 | 13.72 | 294 | 13.72 | ||||||||||
15.40–15.40 | 584 | 8.94 | 15.40 | 171 | 15.40 | ||||||||||
15.59–15.59 | 444 | 9.15 | 15.59 | 1 | 15.59 | ||||||||||
16.19–16.19 | 797 | 9.39 | 16.19 | — | — | ||||||||||
16.22–16.22 | 1,125 | 9.59 | 16.22 | — | — | ||||||||||
16.39–16.39 | 651 | 9.78 | 16.39 | 10 | 16.39 | ||||||||||
18.40–18.40 | 2,816 | 9.93 | 18.40 | — | — | ||||||||||
$ 0.18–18.40 | 27,294 | 7.60 | $ | 5.18 | 18,594 | $ | 1.19 |
(in thousands except for weighted average grant date fair value) | Shares | Weighted- average grant date fair value | Aggregate intrinsic value | |||||||
Non-vested shares at December 31, 2013 | 487 | $ | 11.03 | $ | 7,628 | |||||
Granted | — | |||||||||
Vested | (152 | ) | ||||||||
Non-vested shares at June 30, 2014 | 335 | $ | 12.73 | $ | 13,461 |
(in thousands except for weighted average grant date fair value) | Shares | Weighted- average grant date fair value | ||||
Non-vested shares at December 31, 2013 | 270 | $ | 1.52 | |||
Granted | 5,050 | 16.66 | ||||
Vested | (1,500 | ) | 18.40 | |||
Non-vested shares at June 30, 2014 | 3,820 | 14.91 |
Three months ended | Six months ended | ||||||||||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||||||||||
Stock-based compensation expense: | |||||||||||||||
Cost of revenue | $ | 154 | $ | 157 | $ | 322 | $ | 377 | |||||||
Research and development | 1,657 | 556 | 3,058 | 997 | |||||||||||
Sales and marketing | 1,654 | 1,454 | 3,068 | 2,658 | |||||||||||
General and administrative | 30,728 | 365 | 31,782 | 595 | |||||||||||
Total stock-based compensation expense | 34,193 | 2,532 | 38,230 | 4,627 | |||||||||||
Total tax benefit recognized | (11,483 | ) | (203 | ) | (11,825 | ) | (546 | ) | |||||||
Decrease in net income | $ | 22,710 | $ | 2,329 | $ | 26,405 | $ | 4,081 | |||||||
Stock-based compensation expense by type of award: | |||||||||||||||
Stock options | $ | 3,487 | $ | 2,027 | $ | 6,380 | $ | 3,650 | |||||||
RSUs | 29,313 | — | 29,493 | — | |||||||||||
Restricted stock | 1,352 | 505 | 2,316 | 977 | |||||||||||
ESPP | 41 | — | 41 | — | |||||||||||
Total stock-based compensation expense | 34,193 | 2,532 | 38,230 | 4,627 | |||||||||||
Total tax benefit recognized | (11,483 | ) | (203 | ) | (11,825 | ) | (546 | ) | |||||||
Decrease in net income | $ | 22,710 | $ | 2,329 | $ | 26,405 | $ | 4,081 |
Three months ended | Six months ended | ||||||||||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||||||||||
Stock-based compensation expense: | |||||||||||||||
Cost of revenue | $ | 154 | $ | 157 | $ | 322 | $ | 377 | |||||||
Research and development | 1,657 | 556 | 3,058 | 997 | |||||||||||
Sales and marketing | 1,654 | 1,454 | 3,068 | 2,658 | |||||||||||
General and administrative | 30,728 | 365 | 31,782 | 595 | |||||||||||
Total stock-based compensation expense | 34,193 | 2,532 | 38,230 | 4,627 | |||||||||||
Total tax benefit recognized | (11,483 | ) | (203 | ) | (11,825 | ) | (546 | ) | |||||||
Decrease in net income | $ | 22,710 | $ | 2,329 | $ | 26,405 | $ | 4,081 | |||||||
Stock-based compensation expense by type of award: | |||||||||||||||
Stock options | $ | 3,487 | $ | 2,027 | $ | 6,380 | $ | 3,650 | |||||||
RSUs | 29,313 | — | 29,493 | — | |||||||||||
Restricted stock | 1,352 | 505 | 2,316 | 977 | |||||||||||
ESPP | 41 | — | 41 | — | |||||||||||
Total stock-based compensation expense | 34,193 | 2,532 | 38,230 | 4,627 | |||||||||||
Total tax benefit recognized | (11,483 | ) | (203 | ) | (11,825 | ) | (546 | ) | |||||||
Decrease in net income | $ | 22,710 | $ | 2,329 | $ | 26,405 | $ | 4,081 |
Three months ended | Six months ended | ||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||
Dividend yield | None | None | None | None | |||
Expected volatility | 53.9% | 59.8% | 53.9% - 56.0% | 56.0% - 59.8% | |||
Risk-free interest rate | 1.7% - 1.9% | 0.8% - 1.6% | 1.7% - 2.0% | 0.8% - 1.6% | |||
Expected term (years) | 5.3 - 6.1 | 5.3 - 6.1 | 5.3 - 6.3 | 5.3 - 6.1 | |||
Estimated annual forfeiture rate | 6.0% | 6.0% | 6.0% | 6.0% | |||
Weighted average fair value at grant date | $9.63 | $8.64 | $9.35 | $7.92 |
Three months ended | |
June 30, 2014 | |
Dividend yield | None |
Expected volatility | 45.5% |
Risk-free interest rate | 0.1% |
Expected term (years) | 0.6 |
Weighted average fair value at purchase date | $7.04 |
|
Three months ended | Six months ended | ||||||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||||||
Income tax (benefit) expense | 1,639 | (2,568 | ) | 5,521 | 7,459 | ||||||
Effective tax rate | (9.0 | )% | 33.6 | % | (168.8 | )% | 29.4 | % |
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(in thousands) | Total | 1 year (remaining 6 months fiscal 2014) | 2-3 years (fiscal 2015 and 2016) | 4-5 years (fiscal 2017 and 2018) | More than 5 years (beyond fiscal 2018) | ||||||||||||||
Term loan principal and interest(1) | $ | 112,340 | $ | 57,419 | $ | 54,921 | $ | — | $ | — | |||||||||
Operating leases(2) | 29,459 | 4,332 | 13,829 | 10,705 | 593 | ||||||||||||||
Sponsorship commitments(3) | 17,851 | 4,929 | 12,621 | 301 | — | ||||||||||||||
Other contractual commitments(4) | 3,937 | 232 | 3,705 | — | — | ||||||||||||||
Capital equipment purchase commitments(5) | 12,242 | 12,242 | — | — | — | ||||||||||||||
Total contractual cash obligations | $ | 175,829 | $ | 79,154 | $ | 85,076 | $ | 11,006 | $ | 593 |
(1) | See Note 8, “Financing arrangements.” Interest payments were calculated using the applicable rate as of June 30, 2014. |
(2) | The Company leases its facilities under long-term operating leases, which expire at various dates through May 2019. The lease agreements frequently include leasehold improvement incentives, escalating lease payments, renewal provisions and other provisions which require the Company to pay taxes, insurance, maintenance costs or defined rent increases. |
(3) | The Company sponsors sporting events and athletes as part of its marketing efforts. In many cases, the Company enters into multi-year agreements with event organizers and athletes. |
(4) | The Company purchases software licenses and engages outside consultants to assist with upgrading or implementing its financial and IT systems, which require payments over multiple years. |
(5) | The Company enters into contracts to acquire equipment for tooling and molds as part of its manufacturing operations. In addition, the Company incurs purchase commitments related to the manufacturing of its POP displays by third parties. |
Three months ended | Six months ended | ||||||||||||||
(in thousands) | June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | |||||||||||
Beginning balances | $ | 2,551 | $ | 2,695 | $ | 3,870 | $ | 1,937 | |||||||
Charged to cost of revenue | 3,928 | 1,291 | 4,200 | 3,119 | |||||||||||
Settlements of warranty claims | (1,801 | ) | (1,169 | ) | (3,392 | ) | (2,239 | ) | |||||||
Ending balances | $ | 4,678 | $ | 2,817 | $ | 4,678 | $ | 2,817 |
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Three months ended | Six months ended | ||||||||||||||
(in thousands) | June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | |||||||||||
Americas | $ | 152,710 | $ | 102,017 | $ | 277,876 | $ | 235,491 | |||||||
Europe, Middle East and Africa | 62,832 | 58,925 | 142,939 | 146,708 | |||||||||||
Asia and Pacific area countries | 29,063 | 16,140 | 59,506 | 49,940 | |||||||||||
$ | 244,605 | $ | 177,082 | $ | 480,321 | $ | 432,139 |
June 30, 2014 | December 31, 2013 | ||
Customer A | 20% | 21% | |
Customer B | 12% | 14% | |
Customer C | * | 11% |
Three months ended | Six months ended | ||||||
June 30, 2014 | June 30, 2013 | June 30, 2014 | June 30, 2013 | ||||
Customer A | 17% | 15% | 15% | 14% | |||
Customer B | * | 10% | * | * |
* | Less than 10% of total revenue for the period indicated |
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