QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) |
Title of each class: | Trading Symbol | Name of each exchange on which registered: | ||||||||||||
Large accelerated filer | o | x | ||||||||||||
Non-accelerated filer | o | Emerging growth company | ||||||||||||
Smaller reporting company |
March 31, | December 31, | ||||||||||
2024 | 2023 | ||||||||||
ASSETS | |||||||||||
Current assets | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Restricted cash | |||||||||||
Accounts receivable, net of allowances of $ | |||||||||||
Inventories, net | |||||||||||
Prepaid expenses | |||||||||||
Contract assets | |||||||||||
Other current assets | |||||||||||
Total current assets | |||||||||||
Property and equipment, net | |||||||||||
Operating lease right-of-use assets | |||||||||||
Goodwill | |||||||||||
Intangible assets, net of accumulated amortization | |||||||||||
Deferred income taxes | |||||||||||
Other assets | |||||||||||
Total assets | $ | $ | |||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
Current liabilities | |||||||||||
Accounts payable | $ | $ | |||||||||
Deferred revenue | |||||||||||
Accrued wages and payroll taxes | |||||||||||
Short-term income taxes payable | |||||||||||
Other accrued expenses | |||||||||||
Deferred compensation | |||||||||||
Total current liabilities | |||||||||||
Long-term deferred revenue | |||||||||||
Long-term lease liabilities | |||||||||||
Deferred income taxes | |||||||||||
Other long-term liabilities | |||||||||||
Total liabilities | |||||||||||
Commitments and contingencies | |||||||||||
Stockholders' equity | |||||||||||
Preferred stock: | |||||||||||
Common stock: $ | |||||||||||
Additional paid-in capital | |||||||||||
Treasury stock, at cost: | ( | ( | |||||||||
Retained earnings | |||||||||||
Accumulated other comprehensive loss | ( | ( | |||||||||
Total stockholders' equity | |||||||||||
Total liabilities and stockholders' equity | $ | $ |
Three Months Ended March 31, | |||||||||||
2024 | 2023 | ||||||||||
Revenue | |||||||||||
Product and license | $ | $ | |||||||||
Services and other | |||||||||||
Total revenue | |||||||||||
Cost of goods sold | |||||||||||
Product and license | |||||||||||
Services and other | |||||||||||
Total cost of goods sold | |||||||||||
Gross profit | |||||||||||
Operating costs | |||||||||||
Sales and marketing | |||||||||||
Research and development | |||||||||||
General and administrative | |||||||||||
Restructuring and other related charges | |||||||||||
Amortization of intangible assets | |||||||||||
Total operating costs | |||||||||||
Operating income (loss) | ( | ||||||||||
Interest income, net | |||||||||||
Other income (expense), net | ( | ||||||||||
Income (loss) before income taxes | ( | ||||||||||
Provision for income taxes | |||||||||||
Net income (loss) | $ | $ | ( | ||||||||
Net income (loss) per share | |||||||||||
Basic | $ | $ | ( | ||||||||
Diluted | $ | $ | ( | ||||||||
Weighted average common shares outstanding | |||||||||||
Basic | |||||||||||
Diluted |
Three Months Ended March 31, | |||||||||||
2024 | 2023 | ||||||||||
Net income (loss) | $ | $ | ( | ||||||||
Other comprehensive income (loss) | |||||||||||
Cumulative translation adjustment, net of tax | ( | ||||||||||
Pension adjustment, net of tax | ( | ( | |||||||||
Unrealized gains (loss) on available-for-sale securities | |||||||||||
Comprehensive income (loss) | $ | $ | ( |
Description | Common Stock | Treasury - Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2023 | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment, net of tax | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock awards | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Tax payments for stock issuances | ( | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||
Pension adjustment, net of tax | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2024 | $ | $ | ( | $ | $ | $ | ( | $ |
Description | Common Stock | Treasury - Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2022 | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment, net of tax | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Share-based compensation | ||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock awards | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Tax payments for stock issuances | ( | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||
Unrealized gain (loss) on available-for-sale-securities | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Pension adjustment, net of tax | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2023 | $ | $ | ( | $ | $ | $ | ( | $ |
Three Months Ended March 31, | |||||||||||
2024 | 2023 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net income (loss) | $ | $ | ( | ||||||||
Adjustments to reconcile net income (loss) from operations to net cash used in operations: | |||||||||||
Depreciation and amortization of intangible assets | |||||||||||
Deferred tax benefit | ( | ||||||||||
Stock-based compensation | |||||||||||
Allowance for doubtful accounts | ( | ||||||||||
Changes in operating assets and liabilities: | |||||||||||
Accounts receivable | |||||||||||
Inventories, net | ( | ||||||||||
Contract assets | ( | ||||||||||
Accounts payable | ( | ( | |||||||||
Income taxes payable | ( | ||||||||||
Accrued expenses | ( | ( | |||||||||
Deferred compensation | ( | ( | |||||||||
Deferred revenue | ( | ( | |||||||||
Other assets and liabilities | |||||||||||
Net cash provided by operating activities | |||||||||||
Cash flows from investing activities: | |||||||||||
Maturities of short-term investments | |||||||||||
Additions to property and equipment | ( | ( | |||||||||
Additions to intangible assets | ( | ( | |||||||||
Cash paid for acquisition of business | ( | ||||||||||
Net cash used in investing activities | ( | ( | |||||||||
Cash flows from financing activities: | |||||||||||
Contingent payment related to acquisition | ( | ||||||||||
Tax payments for restricted stock issuances | ( | ( | |||||||||
Net cash used in financing activities | ( | ( | |||||||||
Effect of exchange rate changes on cash | ( | ||||||||||
Net increase in cash | |||||||||||
Cash, cash equivalents, and restricted cash, beginning of period | |||||||||||
Cash, cash equivalents, and restricted cash, end of period | $ | $ |
Three Months Ended March 31, | |||||||||||
(In thousands, except percentages) | 2024 | 2023 | |||||||||
Digital Agreements | |||||||||||
Revenue | $ | $ | |||||||||
Gross profit | $ | $ | |||||||||
Gross margin | % | % | |||||||||
Operating loss (1) | $ | ( | $ | ( | |||||||
Security Solutions | |||||||||||
Revenue | $ | $ | |||||||||
Gross profit | $ | $ | |||||||||
Gross margin | % | % | |||||||||
Operating income | $ | $ | |||||||||
Total Company: | |||||||||||
Revenue | $ | $ | |||||||||
Gross profit | $ | $ | |||||||||
Gross margin | % | % | |||||||||
Statements of Operations reconciliation: | |||||||||||
Segment operating income | $ | $ | |||||||||
Corporate operating expenses not allocated at the segment level | |||||||||||
Operating income (loss) | $ | $ | ( | ||||||||
Interest income, net | |||||||||||
Other income (expense), net | ( | ||||||||||
Income (loss) before income taxes | $ | $ | ( |
Three Months Ended March 31, | |||||||||||||||||||||||
2024 | 2023 | ||||||||||||||||||||||
(In thousands) | Digital Agreements | Security Solutions | Digital Agreements | Security Solutions | |||||||||||||||||||
Subscription | $ | $ | $ | $ | |||||||||||||||||||
Maintenance and support | |||||||||||||||||||||||
Professional services and other (1) | |||||||||||||||||||||||
Hardware products | |||||||||||||||||||||||
Total Revenue | $ | $ | $ | $ |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Subscription | $ | $ | |||||||||
Maintenance and support | |||||||||||
Professional services and other (1) | |||||||||||
Hardware products | |||||||||||
Total Revenue | $ | $ |
Three Months Ended March 31, | |||||||||||
(In thousands, except percentages) | 2024 | 2023 | |||||||||
Revenue | |||||||||||
EMEA | $ | $ | |||||||||
Americas | |||||||||||
APAC | |||||||||||
Total revenue | $ | $ | |||||||||
% of Total Revenue | |||||||||||
EMEA | % | % | |||||||||
Americas | % | % | |||||||||
APAC | % | % |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Products and licenses transferred at a point in time | $ | $ | |||||||||
Services transferred over time | |||||||||||
Total Revenue | $ | $ |
March 31, | December 31, | ||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Receivables, inclusive of trade and unbilled | $ | $ | |||||||||
Contract Assets (current and non-current) | $ | $ | |||||||||
Contract Liabilities (Deferred Revenue current and non-current) | $ | $ |
(In thousands) | 2024 | 2025 | 2026 | Beyond 2026 | Total | ||||||||||||||||||||||||
Future revenue related to current unsatisfied performance obligations | $ | $ | $ | $ | $ |
(In thousands) | March 31, 2024 | December 31, 2023 | |||||||||
Capitalized costs to obtain contracts, current | $ | $ | |||||||||
Capitalized costs to obtain contracts, non-current | $ | $ |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Amortization of capitalized costs to obtain contracts | $ | $ | |||||||||
(In thousands) | March 31, 2024 | December 31, 2023 | |||||||||
Component parts | $ | $ | |||||||||
Work-in-process and finished goods | |||||||||||
Total | $ | $ |
(In thousands) | Digital Agreements | Security Solutions | Total | ||||||||||||||
Net balance at December 31, 2023 | $ | $ | $ | ||||||||||||||
Foreign currency exchange rate effect | ( | ( | ( | ||||||||||||||
Net balance at March 31, 2024 | $ | $ | $ |
As of March 31, 2024 | As of December 31, 2023 | ||||||||||||||||||||||||||||
(In thousands) | Useful Life (in years) | Gross Carrying Amount | Accumulated Amortization | Gross Carrying Amount | Accumulated Amortization | ||||||||||||||||||||||||
Acquired technology | $ | $ | $ | $ | |||||||||||||||||||||||||
Customer relationships | |||||||||||||||||||||||||||||
Patents, trademarks, and other | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ |
(In thousands) | March 31, 2024 | December 31, 2023 | |||||||||
Office equipment and software | $ | $ | |||||||||
Leasehold improvements | |||||||||||
Furniture and fixtures | |||||||||||
Capitalized software | |||||||||||
Total | |||||||||||
Accumulated depreciation | ( | ( | |||||||||
Property and equipment, net | $ | $ |
Fair Value Measurement at Reporting Date Using | |||||||||||||||||||||||
(In thousands) | March 31, 2024 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||
Assets: | |||||||||||||||||||||||
U.S. Treasury Bills | $ | $ | $ | $ | |||||||||||||||||||
Money Market Funds |
Fair Value Measurement at Reporting Date Using | |||||||||||||||||||||||
(In thousands) | December 31, 2023 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||
Assets: | |||||||||||||||||||||||
Money Market Funds | $ | $ | $ | $ | |||||||||||||||||||
(In thousands) | |||||
Balance at December 31, 2023 | $ | ||||
Provision for (recovery of) | ( | ||||
Write-offs | ( | ||||
Net foreign currency translation | ( | ||||
Balance at March 31, 2024 | $ |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Building rent | $ | $ | |||||||||
Automobile rentals | |||||||||||
Total net operating lease costs | $ | $ |
(In thousands) | As of March 31, 2024 | ||||
2024 | $ | ||||
2025 | |||||
2026 | |||||
2027 | |||||
2028 | |||||
Later years | |||||
Less imputed interest | ( | ||||
Accrued lease termination fees | |||||
Total lease liabilities | $ |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Stock-based compensation (1) | $ | $ | |||||||||
Other long-term incentive plan compensation (2) | |||||||||||
Total compensation | $ | $ |
Three Months Ended March 31, | |||||||||||
(In thousands, except per share data) | 2024 | 2023 | |||||||||
Net income (loss) | $ | $ | ( | ||||||||
Weighted average common shares outstanding: | |||||||||||
Basic | |||||||||||
Incremental shares with dilutive effect: | |||||||||||
Restricted stock units | |||||||||||
Diluted | |||||||||||
Net income (loss) per share: | |||||||||||
Basic | $ | $ | ( | ||||||||
Diluted | $ | $ | ( |
(In thousands) | Employee Costs | Real Estate Rationalization | Total | ||||||||||||||
Balance as of December 31, 2023 | $ | $ | $ | ||||||||||||||
Additions | |||||||||||||||||
Payments | ( | ( | ( | ||||||||||||||
Balance as of March 31, 2024 | $ | $ | $ |
Three Months Ended March 31, | |||||||||||
(In thousands, except percentages) | 2024 | 2023 | |||||||||
Digital Agreements | |||||||||||
Revenue | $ | 14,414 | $ | 11,552 | |||||||
Gross profit | $ | 9,892 | $ | 8,448 | |||||||
Gross margin | 69 | % | 73 | % | |||||||
Operating loss | $ | (265) | $ | (6,033) | |||||||
Security Solutions | |||||||||||
Revenue | $ | 50,429 | $ | 46,055 | |||||||
Gross profit | $ | 37,503 | $ | 30,838 | |||||||
Gross margin | 74 | % | 67 | % | |||||||
Operating income | $ | 25,878 | $ | 15,631 | |||||||
Total Company: | |||||||||||
Revenue | $ | 64,843 | $ | 57,607 | |||||||
Gross profit | $ | 47,395 | $ | 39,286 | |||||||
Gross margin | 73 | % | 68 | % | |||||||
Statements of Operations reconciliation: | |||||||||||
Segment operating income | $ | 25,613 | $ | 9,598 | |||||||
Corporate operating expenses not allocated at the segment level | 11,503 | 17,728 | |||||||||
Operating income (loss) | 14,110 | (8,130) | |||||||||
Interest income, net | 101 | 503 | |||||||||
Other income (expense), net | 291 | (40) | |||||||||
Income (loss) before income taxes | $ | 14,502 | $ | (7,667) | |||||||
Three Months Ended March 31, | |||||||||||||||||||||||
2024 | 2023 | ||||||||||||||||||||||
(In thousands) | Digital Agreements | Security Solutions | Digital Agreements | Security Solutions | |||||||||||||||||||
Subscription | $ | 13,812 | $ | 26,182 | $ | 10,348 | $ | 19,608 | |||||||||||||||
Maintenance and support | 505 | 10,066 | 996 | 10,165 | |||||||||||||||||||
Professional services and other (1) | 97 | 1,605 | 208 | 1,416 | |||||||||||||||||||
Hardware products | — | 12,576 | — | 14,866 | |||||||||||||||||||
Total Revenue | $ | 14,414 | $ | 50,429 | $ | 11,552 | $ | 46,055 |
Three Months Ended March 31, | |||||||||||
(In thousands, except percentages) | 2024 | 2023 | |||||||||
Revenue | |||||||||||
EMEA | $ | 31,842 | $ | 27,820 | |||||||
Americas | 21,344 | 20,498 | |||||||||
APAC | 11,657 | 9,289 | |||||||||
Total revenue | $ | 64,843 | $ | 57,607 | |||||||
% of Total Revenue | |||||||||||
EMEA | 49 | % | 48 | % | |||||||
Americas | 33 | % | 36 | % | |||||||
APAC | 18 | % | 16 | % |
Three Months Ended March 31, | |||||||||||
(In thousands, except percentages) | 2024 | 2023 | |||||||||
Cost of goods sold | |||||||||||
Product and license | $ | 9,706 | $ | 11,288 | |||||||
Services and other | 7,742 | 7,033 | |||||||||
Total cost of goods sold | $ | 17,448 | $ | 18,321 | |||||||
Gross profit | $ | 47,395 | $ | 39,286 | |||||||
Gross margin | |||||||||||
Product and license | 74 | % | 66 | % | |||||||
Services and other | 71 | % | 71 | % | |||||||
Total gross margin | 73 | % | 68 | % |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Operating costs | |||||||||||
Sales and marketing | $ | 12,927 | $ | 20,011 | |||||||
Research and development | 8,259 | 9,463 | |||||||||
General and administrative | 10,007 | 16,653 | |||||||||
Restructuring and other related charges | 1,497 | 706 | |||||||||
Amortization of intangible assets | 595 | 583 | |||||||||
Total operating costs | $ | 33,285 | $ | 47,416 |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Interest income, net | $ | 101 | $ | 503 |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Other income (expense), net | $ | 291 | $ | (40) |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Provision for income taxes | $ | 1,034 | $ | 689 |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Cash provided by (used in): | |||||||||||
Operating activities | $ | 26,960 | $ | 13,237 | |||||||
Investing activities | (3,080) | (2,546) | |||||||||
Financing activities | (1,795) | (1,098) | |||||||||
Effect of foreign exchange rate changes on cash and cash equivalents | (734) | 569 |
Three Months Ended March 31, | |||||||||||
(In thousands) | 2024 | 2023 | |||||||||
Net income (loss) | $ | 13,468 | $ | (8,356) | |||||||
Interest income, net | (101) | (503) | |||||||||
Provision for income taxes | 1,034 | 689 | |||||||||
Depreciation and amortization of intangible assets (1) | 2,082 | 1,319 | |||||||||
Long-term incentive compensation (2) | 1,621 | 3,923 | |||||||||
Restructuring and other related charges (3) | 1,516 | 706 | |||||||||
Other non-recurring items (4) | 171 | 585 | |||||||||
Adjusted EBITDA | $ | 19,791 | $ | (1,637) |
Period | Total Number of Shares Purchased (1) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) | Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1) | ||||||||||||||||||||||
January 1, 2024 through January 31, 2024 | — | $ | — | — | $ | 15,762,798 | ||||||||||||||||||||
February 1, 2024 through February 29, 2024 | — | $ | — | — | $ | 15,762,798 | ||||||||||||||||||||
March 1, 2024 through March 31, 2024 | — | $ | — | — | $ | 15,762,798 |
Exhibit 101.INS – Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | ||
Exhibit 101.SCH – Inline XBRL Taxonomy Extension Schema Document | ||
Exhibit 101.CAL – Inline XBRL Taxonomy Extension Calculation Linkbase Document | ||
Exhibit 101.LAB – Inline XBRL Taxonomy Extension Label Linkbase Document | ||
Exhibit 101.PRE – Inline XBRL Taxonomy Extension Presentation Linkbase Document | ||
Exhibit 101.DEF – Inline XBRL Taxonomy Extension Definition Linkbase Document | ||
Exhibit 104 – The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |
OneSpan Inc. | |||||
/s/ Victor Limongelli | |||||
Victor Limongelli | |||||
Interim Chief Executive Officer | |||||
(Principal Executive Officer) | |||||
/s/ Jorge Martell | |||||
Jorge Martell | |||||
Chief Financial Officer | |||||
(Principal Financial and Accounting Officer) |
Achievement Level Against Target | Payout Level | Weight | Weighted Factor (Payout Level*Weight) | |||||||||||
Company Performance Factors | ||||||||||||||
Revenue | 115% | 125% | 50% | 62.5% | ||||||||||
Adjusted EBITDA | 100% | 100% | 50% | 50% | ||||||||||
Combined Performance Factor (sum of the two weighted factors) | 112.5% |
Achievement Level Against Target | Payout Level | Weight | Weighted Factor (Payout Level*Weight) | |||||||||||
Company Performance Factors | ||||||||||||||
Revenue | 103% | 117% | 50% | 59% | ||||||||||
Adjusted EBITDA | 110% | 121% | 50% | 60% | ||||||||||
Combined Performance Factor (sum of the two weighted factors) | 119% |
Dated: May 2, 2024 | /s/ Victor Limongelli | ||||
Victor Limongelli | |||||
Interim Chief Executive Officer (Principal Executive Officer) |
Dated: May 2, 2024 | /s/ Jorge Martell | ||||
Jorge Martell | |||||
Chief Financial Officer | |||||
(Principal Financial and Accounting Officer) |
/s/ Victor Limongelli | |||||
Victor Limongelli | |||||
Interim Chief Executive Officer | |||||
May 2, 2024 |
/s/ Jorge Martell | |||||
Jorge Martell | |||||
Chief Financial Officer | |||||
May 2, 2024 |
G241!
M5'A>[9P)6%1'ML>A%_>XQ"TNB7$7$5Q 1%P0%25N"5$BT:A1%@$'$5RBHFD%
MQ 474*,A.A+ #50T[(O:(,8E:E#1))J\R;Q)\B:9F4QFDLGDY263FO/7KKSZ
MVMO-;;K-&*W_]_V^[KY];]7MVW6J3ITZ]SI)24E)24E)24E)24E)24E)24E)
M24E)23V2"K]\61]^V=@FI+;2)?R*T7/>M:J18;55/J$WS@Z84V-\>M[[9Q]S
M8LS9M+N4E%1=,C"#)JRV
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands |
Mar. 31, 2024 |
Dec. 31, 2023 |
---|---|---|
Current assets | ||
Accounts receivable, allowance for doubtful accounts | $ 1,472 | $ 1,536 |
Stockholders' equity | ||
Preferred stock, shares authorized (in shares) | 500 | 500 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 75,000 | 75,000 |
Common stock, shares issued (in shares) | 41,492 | 41,243 |
Common stock, shares outstanding (in shares) | 37,768 | 37,519 |
Treasury stock, common, shares (in shares) | 3,724 | 3,724 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2024 |
Mar. 31, 2023 |
|
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 13,468 | $ (8,356) |
Other comprehensive income (loss) | ||
Cumulative translation adjustment, net of tax | (1,655) | 1,715 |
Pension adjustment, net of tax | (30) | (60) |
Unrealized gains (loss) on available-for-sale securities | 0 | 7 |
Comprehensive income (loss) | $ 11,783 | $ (6,694) |
Description of the Company and Basis of Presentation |
3 Months Ended |
---|---|
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of the Company and Basis of Presentation | Description of the Company and Basis of Presentation Description of the Company OneSpan provides security, identity, electronic signature (“e-signature”) and digital workflow solutions that protect and facilitate digital transactions and agreements. The Company delivers products and services that automate and secure customer-facing and revenue-generating business processes for use cases ranging from simple transactions to workflows that are complex or require higher levels of security. The Company’s solutions help its customers ensure the integrity of the people and records associated with digital agreements, transactions, and interactions in industries including banking, financial services, healthcare, and professional services. OneSpan has operations in Austria, Australia, Belgium, Canada, China, France, Japan, The Netherlands, Singapore, Switzerland, the United Arab Emirates, the United Kingdom (U.K.), and the United States (U.S.). Business Transformation In December 2021, the Company's Board of Directors approved a restructuring plan (the "restructuring plan") designed to advance the Company's operating model, streamline its business, improve efficiency, and enhance its capital resources. The first phase of this restructuring plan began and was substantially completed during the three months ended March 31, 2022. In May 2022, the Company's Board of Directors announced a three-year strategic transformation plan that began on January 1, 2023 (the "2022 strategic plan"). In conjunction with the 2022 strategic plan and to enable a more efficient capital deployment model, effective with the quarter ended June 30, 2022, the Company began reporting under the following two lines of business, which are its reportable operating segments: Digital Agreements and Security Solutions. For further information regarding the Company’s reportable segments, see Note 3, Segment Information. During the quarter ended June 30, 2023, the Company determined that it was unlikely to achieve the revenue growth levels set forth in its 2022 strategic plan within the contemplated three-year timeframe. A number of factors contributed to the challenges achieving the originally planned growth levels, particularly in Digital Agreements, on the timeframes set forth in the 2022 strategic plan. In response to these challenges, the Company modified its strategy to focus more heavily on improving profitability margins across the business. To this end, in August 2023, the Company’s Board approved cost reduction actions (the “2023 Actions”) to seek to drive higher levels of profitability while maintaining the Company’s long-term growth potential. Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of OneSpan and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles in the United States of America (“U.S. GAAP”) for complete financial statements and should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. In the opinion of management, the accompanying unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the results of the interim periods presented. Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for any future period or the entire fiscal year. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Estimates and Assumptions The preparation of the 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 financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Foreign Currency Translation and Transactions The financial position and results of operations of the majority of the Company’s foreign subsidiaries are measured using the local currency as the functional currency. Accordingly, assets and liabilities are translated into U.S. Dollars using current exchange rates as of the balance sheet date. Revenue and expenses are translated at average exchange rates prevailing during the year. Translation adjustments arising from differences in exchange rates are charged or credited to other comprehensive income (loss). Gains and losses resulting from foreign currency transactions are included in the condensed consolidated statements of operations in other (expense) income, net. Foreign exchange transaction gains (losses) aggregated $0.1 million and $(0.2) million for the three months ended March 31, 2024 and 2023, respectively.
|
Summary of Significant Accounting Policies |
3 Months Ended |
---|---|
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies There have been no changes to the significant accounting policies described in the Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on March 6, 2024 that have had a material impact on the Company’s condensed consolidated financial statements and related notes. Restricted Cash The Company is party to lease agreements that require letters of credit to secure the obligations which totaled $0.9 million at both March 31, 2024 and December 31, 2023. Additionally, the Company maintained a cash guarantee with a payroll vendor in the amount of $0.1 million at both March 31, 2024 and December 31, 2023. The restricted cash related to the letters of credit and the payroll vendor cash guarantee is recorded in "Restricted cash" on the condensed consolidated balance sheets. Recently Issued Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB) or other standard setting bodies that are adopted by the Company as of the specified effective date. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures, to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments are effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company is evaluating the impact the adoption of this guidance will have on its condensed consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures, which is intended to enhance the transparency and decision usefulness of income tax disclosures. Public business entities are required to adopt for annual fiscal periods beginning after December 31, 2024 and early adoption is permitted. The Company is evaluating the impact the adoption of this guidance will have on its condensed consolidated financial statements and related disclosures.
|
Segment Information |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information Segments are defined as components of a company that engage in business activities from which they may earn revenues and incur expenses, and for which separate financial information is available and is evaluated regularly by the chief operating decision maker (CODM), in deciding how to allocate resources and in assessing performance. The Company’s CODM is its Chief Executive Officer. •Digital Agreements. Digital Agreements consists of solutions that enable our clients to secure and automate business processes associated with their digital agreement and customer transaction lifecycles that require consent, non-repudiation and compliance. These solutions, which are largely cloud-based, include OneSpan Sign e-signature, OneSpan Notary, Identity Verification, and OneSpan Trust Vault. This segment also includes costs attributable to our transaction cloud platform. •Security Solutions. Security Solutions consists of our broad portfolio of software products, software development kits (SDKs) and Digipass authenticator devices that are used to build applications designed to defend against attacks on digital transactions across online environments, devices, and applications. The software products and SDKs included in the Security Solutions segment are largely on-premises software products and include multi-factor authentication and transaction signing solutions, such as mobile application security and mobile software tokens. Segment operating income consists of the revenues generated by a segment, less the direct costs of revenue, sales and marketing, research and development expenses, amortization expense, and restructuring and other related charges that are incurred directly by a segment. Unallocated corporate costs include costs related to administrative functions that are performed in a centralized manner that are not attributable to a particular segment. The tables below set forth information about the Company’s reportable operating segments for the three months ended March 31, 2024 and 2023, along with the items necessary to reconcile the segment information to the totals reported in the accompanying condensed consolidated financial statements.
(1) Digital Agreements operating loss includes $0.6 million of amortization of intangible assets expense for both the three months ended March 31, 2024 and 2023. The following tables illustrate the disaggregation of revenues by category and services, including a reconciliation of the disaggregated revenues to revenues from the Company’s two reportable operating segments for the three months ended March 31, 2024 and 2023:
(1) Professional services and other includes perpetual software licenses revenue, which was approximately 1% of total revenue for both the three months ended March 31, 2024 and 2023. The Company allocates goodwill by reporting unit, in accordance with Accounting Standards Codification (ASC) 350 – Goodwill and Other. Asset information by segment is not reported to or reviewed by the CODM to allocate resources, and therefore, the Company has not disclosed asset information for the segments.
|
Revenue from Contracts with Customers |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contracts with Customers | Revenue from Contracts with Customers The following tables present the Company’s revenues disaggregated by major products and services, geographical region and timing of revenue recognition. Revenue by major products and services
(1) Professional services and other includes perpetual software licenses revenue, which was approximately 1% of total revenue for both the three months ended March 31, 2024 and 2023. Revenue by location of customer We classify our sales by customer location in three geographic regions: 1) EMEA, which includes Europe, Middle East and Africa; 2) the Americas, which includes North, Central, and South America; and 3) Asia Pacific (APAC), which includes Australia, New Zealand, and India. The breakdown of revenue in each of our major geographic areas was as follows:
Timing of revenue recognition
Contract balances The following table provides information about receivables, contract assets, and contract liabilities from contracts with customers as of March 31, 2024 and December 31, 2023:
Contract assets relate primarily to multi-year term license arrangements and the remaining contractual billings. These contract assets are transferred to receivables when the right to bill occurs over a 2- to 5-year period. The contract liabilities primarily relate to the advance consideration received from customers for subscription and maintenance services. Revenue is recognized for these services over time. As a practical expedient, the Company does not adjust the promised amount of consideration for the effects of a significant financing component when it is expected, at contract inception, that the period between the Company's transfer of a promised product or service to a customer and when the customer pays for that product or service will be one year or less. Extended payment terms are not typically included in contracts with customers. Revenue recognized during the three months ended March 31, 2024 included $30.4 million that was included on the December 31, 2023 consolidated balance sheet in contract liabilities. Deferred revenue decreased in the same period due to timing of annual renewals. Transaction price allocated to the remaining performance obligations Remaining performance obligations represent the revenue that is expected to be recognized in future periods related to performance obligations that are unsatisfied, or partially unsatisfied, as of the end of the period. The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of March 31, 2024:
The Company applies practical expedients and does not disclose information about remaining performance obligations (a) that have original expected durations of one year or less, or (b) where revenue is recognized as invoiced. Costs of obtaining a contract The Company incurs incremental costs related to commissions, which can be directly tied to obtaining a contract. The Company capitalizes commissions associated with certain new contracts and amortizes the costs over a period of up to 7 years, which is the determined benefit period based on the transfer of goods or services. The Company determined the period of benefit by taking into consideration the customer contracts, its technology and other factors, including customer attrition. Commissions are earned upon invoicing to the customer. For contracts with multiple year payment terms, because the commissions that are payable after year 1 are payable based on continued employment, they are expensed when incurred. Commissions and amortization expense are included in “Sales and Marketing” expense in the condensed consolidated statements of operations. As a practical expedient, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period for the assets that the Company otherwise would have recognized is one year or less. These costs are included in “Sales and Marketing” expense in the condensed consolidated statements of operations. The following tables provide information related to the capitalized costs and amortization recognized in the current and prior period:
|
Inventories, net |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories, net | Inventories, net Inventories, net, consisting principally of hardware and component parts, are stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out (FIFO) method. Inventories, net consist of the following:
|
Goodwill |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill | Goodwill The following table presents the changes in goodwill during the three months ended March 31, 2024:
No impairment of goodwill was recorded during the three months ended March 31, 2024 and 2023.
|
Intangible Assets |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets | Intangible Assets Intangible assets as of March 31, 2024 and December 31, 2023 consist of the following:
Amortization expense was $0.7 million and $0.6 million for the three months ended March 31, 2024 and 2023, respectively. Amortization expense includes cost of sales amortization expense directly related to delivering cloud subscription revenue of $0.1 million and less than $0.1 million for the three months ended March 31, 2024 and 2023, respectively. Costs are recorded in "Services and other cost of goods sold" on the condensed consolidated statements of operations. Certain intangible assets are denominated in functional currencies besides the U.S. dollar and are subject to currency fluctuations. There was no impairment of intangible assets recorded during the three months ended March 31, 2024 and 2023.
|
Property and Equipment, net |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment, net | Property and Equipment, net The following table presents the major classes of property and equipment, net, as of March 31, 2024 and December 31, 2023:
Depreciation expense was $1.4 million and $0.7 million for the three months ended March 31, 2024 and 2023, respectively. Depreciation expense includes cost of sales depreciation expense directly related to delivering cloud subscription revenue of $0.7 million and less than $0.1 million for the three months ended March 31, 2024 and 2023, respectively. Costs are recorded in "Services and other cost of goods sold" on the condensed consolidated statements of operations.
|
Fair Value Measurements |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements The fair values of cash equivalents, accounts receivables, and accounts payable approximate their carrying amounts due to their short duration. The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources while unobservable inputs reflect a reporting entity’s pricing base upon its own market assumptions. The estimated fair value of financial instruments has been determined by using available market information and appropriate valuation methodologies, as defined in ASC 820, Fair Value Measurements. The fair value hierarchy consists of the following three levels: •Level 1 – Inputs are quoted prices in active markets for identical assets or liabilities. •Level 2 – Inputs are quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable and market-corroborated inputs which are derived primarily from or corroborated by observable market data. •Level 3 – Inputs are derived from valuation techniques in which one or more significant inputs or value drivers are unobservable. The following tables summarize the Company’s financial assets by level in the fair value hierarchy, which are measured at fair value on a recurring basis, as of March 31, 2024 and December 31, 2023:
The Company classifies its investments in debt securities as available-for-sale. The Company reviews available-for-sale debt securities for impairments related to losses and other factors each quarter. The unrealized gains and losses on the available-for-sale debt securities were not material as of March 31, 2024 and December 31, 2023. The Company did not have any financial liabilities that are measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023. The Company’s non-financial assets and liabilities, which include goodwill and long-lived assets held and used, are not required to be measured at fair value on a recurring basis. However, if certain triggering events occur, or if an annual impairment test is required, the Company would evaluate the non-financial assets and liabilities for impairment. If an impairment was to occur, the asset or liability would be recorded at its estimated fair value.
|
Allowance for Credit Losses |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||
Credit Loss [Abstract] | |||||||||||||||||||||||||||||||||||||||||||
Allowance for Credit Losses | Allowance for Credit Losses In accordance with accounting standards updates ("ASU") No. 2016-13, the Company evaluates its allowance based on expected losses rather than incurred losses, which is known as the current expected credit loss (“CECL”) model. The allowance is determined using the loss rate approach and is measured on a collective (pool) basis when similar risk characteristics exist. Where financial instruments do not share risk characteristics, they are evaluated on an individual basis. The allowance is based on relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. The changes in the allowance for credit losses during the three months ended March 31, 2024 were as follows:
|
Leases |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases Operating lease cost details for the three months ended March 31, 2024 and 2023 are as follows:
At March 31, 2024, the Company’s weighted average remaining lease term for its operating leases is 5.2 years, and the weighted average discount rate for its operating leases is 5%. During the three months ended March 31, 2024, there were $0.7 million of operating cash payments for lease liabilities and $0.5 million of right-of use assets obtained in exchange for new lease liabilities. In October 2023, the Company signed a lease agreement to lease new office space in Brussels. The lease agreement consisted of a nine-year lease that is expected to commence in the second quarter of 2024. The Company will record a right of use asset and liability at the commencement date, which is expected to result in total lease term payments of $1.3 million. Maturities of the Company’s operating leases as of March 31, 2024 are as follows:
|
Income Taxes |
3 Months Ended |
---|---|
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s estimated annual effective tax rate for 2024 before discrete items and excluding entities with a valuation allowance is expected to be approximately 15%. The Company’s global effective tax rate is lower than the U.S. statutory tax rate of 21% primarily due to the release of valuation allowances for the current year earnings for companies with a valuation allowance, offset by nondeductible expenses. In addition, the Company received a favorable response in connection with its Mutual Agreement Procedure ("MAP") request related to a Belgium audit concluded in 2020. A tax benefit of $1.1 million was recorded for the three months ended March 31, 2024. The ultimate tax expense will depend on the mix of earnings in various jurisdictions. Income taxes, net of refunds, of $0.9 million and $1.1 million were paid during the three months ended March 31, 2024 and 2023, respectively. Management assesses the need for a valuation allowance on a regular basis, weighing all positive and negative evidence to determine whether a deferred tax asset will be fully or partially realized. In evaluating the realizability of deferred tax assets, significant pieces of negative evidence such as 3-year cumulative losses are considered. Management also reviews reversal patterns of temporary differences to determine if the Company would have sufficient taxable income due to the reversal of temporary differences to support the realization of deferred tax assets. Certain operations have incurred net operating losses (NOLs), which are currently subject to a valuation allowance. These NOLs may become deductible to the extent these operations become profitable. For each of its operations, the Company evaluates whether it is more likely than not that the tax benefits related to NOLs will be realized. As part of this evaluation, the Company considers evidence such as tax planning strategies, historical operating results, forecasted taxable income, and recent financial performance. In the year that certain operations record a loss, the Company does not recognize a corresponding tax benefit, thus increasing its effective tax rate, or decreasing its effective tax rate when reporting income in a jurisdiction that has a valuation allowance. Upon determining that it is more likely than not that the NOLs will be realized, the Company will reduce the tax valuation allowances related to these NOLs, which will result in a reduction of its income tax expense and its effective tax rate in the period.
|
Long-Term Compensation Plan and Stock Based Compensation |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Compensation Plan and Stock Based Compensation | Long-Term Compensation Plan and Stock Based Compensation Under the OneSpan Inc. 2019 Omnibus Incentive Plan, the Company awards restricted stock units subject to time-based vesting, restricted stock units which are subject to the achievement of future performance criteria and restricted stock units that are subject to the achievement of market conditions. The Company also awards a small amount of cash incentive awards under the 2019 Omnibus Incentive Plan, as shown in the table below. The Company awarded 0.1 million restricted stock units during the three months ended March 31, 2024, subject to time-based vesting. The fair value of the unissued time-based restricted stock unit grants was $0.9 million at the dates of grant and the grants are being amortized over the vesting periods of one year. The following table summarizes stock-based compensation expense and other long-term incentive plan compensation expense for the three months ended March 31, 2024 and 2023:
(1) Stock-based compensation declined for the three months ended March 31, 2024 as compared to the three months ended March 31, 2023, and was primarily due to the departure of the former CEO and forfeitures reversed upon his termination and timing of annual grants. (2) Other long-term incentive compensation consists of immaterial expense for cash incentive awards granted to employees located in jurisdictions where we do not issue stock-based compensation due to tax, regulatory or similar reasons.
|
Earnings per Share |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per Share | Earnings per Share Basic earnings per share is based on the weighted average number of shares outstanding and excludes the dilutive effect of common stock equivalents. Diluted earnings per share is based on the weighted average number of shares outstanding and includes the dilutive effect of common stock equivalents to the extent they are not anti-dilutive. Because the Company was in a net loss position for the three months ended March 31, 2023, diluted net loss per share for the period excludes the effects of common stock equivalents, which are anti-dilutive. The details of the earnings per share calculations for the three months ended March 31, 2024 and 2023 are as follows:
|
Legal Proceedings and Contingencies |
3 Months Ended |
---|---|
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings and Contingencies | Legal Proceedings and Contingencies The Company is subject to certain legal proceedings and claims that have arisen in the ordinary course of business. The Company currently does not anticipate that these matters, if resolved against the Company, will have a material adverse impact on its financial results or financial condition. The Company accrues loss contingencies when losses become probable and are reasonably estimable. As of March 31, 2024, the Company has recorded an accrual of $1.2 million for loss contingencies associated with employment-related and supplier contract matters. The Company does not accrue for contingent losses that, in the judgment of the Company, are considered to be reasonably possible, but not probable. As of March 31, 2024, the Company does not have any reasonably possible losses for which an estimate can be made. Although the Company intends to defend its legal matters vigorously, the ultimate outcome of these matters is uncertain. However, the Company does not expect the potential losses, if any, to have a material adverse impact on its operating results, cash flows, or financial condition.
|
Restructuring and Other Related Charges |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Other Related Charges | Restructuring and Other Related Charges In December 2021, the Company's Board approved a restructuring plan (“Plan”) designed to advance the Company’s operating model, streamline its business, improve efficiency, and enhance its capital resources. As part of the first phase of the Plan, the Company reduced headcount by eliminating positions in certain areas of its organization. The first phase of the Plan began and was substantially completed during the three months ended March 31, 2022. In May 2022, the Board approved additional actions related to the Plan through the year ending December 31, 2025. This second phase of the Plan consisted primarily of headcount-related reductions and was designed to achieve the same objectives as the first phase of the Plan. On August 3, 2023, the Board approved additional cost reduction and restructuring actions (the "2023 Actions") to seek to drive higher levels of Adjusted EBITDA while maintaining the Company's long-term growth potential. The Company has incurred and expects to continue to incur restructuring charges in connection with the 2023 Actions, and anticipates that these charges will consist primarily of charges related to employee transition and severance payments, with a significantly smaller amount of charges relating to vendor contract termination and rationalization actions. In connection with the Plan (including the 2023 Actions), the Company recorded $1.5 million and $0.7 million in “Restructuring and other related charges” in the condensed consolidated statement of operations for the three months ended March 31, 2024 and 2023, respectively. The main categories of charges are in the following areas: •Employee costs – include severance and related benefits costs incurred as a result of eliminating positions in certain areas of the Company. For the three months ended March 31, 2024 and 2023, severance-related costs were $1.4 million and $0.7 million, respectively. In total, there were approximately 290 employees, across multiple functions, whose positions were made redundant. The $2.7 million current portion of the restructuring liability at March 31, 2024 is included in "Accrued wages and payroll taxes" in the consolidated balance sheet and is expected to be paid within the next 12 months. The $0.5 million non-current portion is included in "Other long-term liabilities" in the condensed consolidated balance sheet and is expected to be paid within the next 24 months. •Real estate rationalization costs – includes costs to align the real estate footprint with the Company’s needs. In 2023, the Company vacated its Chicago and Brussels office spaces, which resulted in the abandonment and termination of the underlying leases. The Company accrued contract termination fees of $1.4 million and $0.3 million for the Chicago office and Brussels office, respectively. The Company additionally terminated its Brussels warehouse lease, effective July 31, 2024, and accrued $0.3 million in settlement costs. The $0.3 million current portion of the restructuring liability at March 31, 2024 is included in "Other accrued expenses" in the condensed consolidated balance sheet and is expected to be paid within the next 12 months. The remaining $0.7 million portion is included in "Current lease liabilities" in the condensed consolidated balance sheet and is expected to be paid within the next 12 months. The table below sets forth the changes in the carrying amount of the restructuring charge liability for the three months ended March 31, 2024.
|
Summary of Significant Accounting Policies (Policies) |
3 Months Ended |
---|---|
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Description of the Company | Description of the Company OneSpan provides security, identity, electronic signature (“e-signature”) and digital workflow solutions that protect and facilitate digital transactions and agreements. The Company delivers products and services that automate and secure customer-facing and revenue-generating business processes for use cases ranging from simple transactions to workflows that are complex or require higher levels of security. The Company’s solutions help its customers ensure the integrity of the people and records associated with digital agreements, transactions, and interactions in industries including banking, financial services, healthcare, and professional services. OneSpan has operations in Austria, Australia, Belgium, Canada, China, France, Japan, The Netherlands, Singapore, Switzerland, the United Arab Emirates, the United Kingdom (U.K.), and the United States (U.S.).
|
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements include the accounts of OneSpan and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles in the United States of America (“U.S. GAAP”) for complete financial statements and should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
|
Principles of Consolidation | The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
|
Estimates and Assumptions | Estimates and Assumptions The preparation of the 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 financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
|
Foreign Currency Translation and Transactions | Foreign Currency Translation and Transactions The financial position and results of operations of the majority of the Company’s foreign subsidiaries are measured using the local currency as the functional currency. Accordingly, assets and liabilities are translated into U.S. Dollars using current exchange rates as of the balance sheet date. Revenue and expenses are translated at average exchange rates prevailing during the year. Translation adjustments arising from differences in exchange rates are charged or credited to other comprehensive income (loss). Gains and losses resulting from foreign currency transactions are included in the condensed consolidated statements of operations in other (expense) income, net.
|
Restricted Cash | Restricted Cash The Company is party to lease agreements that require letters of credit to secure the obligations which totaled $0.9 million at both March 31, 2024 and December 31, 2023. Additionally, the Company maintained a cash guarantee with a payroll vendor in the amount of $0.1 million at both March 31, 2024 and December 31, 2023. The restricted cash related to the letters of credit and the payroll vendor cash guarantee is recorded in "Restricted cash" on the condensed consolidated balance sheets.
|
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB) or other standard setting bodies that are adopted by the Company as of the specified effective date. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures, to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments are effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company is evaluating the impact the adoption of this guidance will have on its condensed consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures, which is intended to enhance the transparency and decision usefulness of income tax disclosures. Public business entities are required to adopt for annual fiscal periods beginning after December 31, 2024 and early adoption is permitted. The Company is evaluating the impact the adoption of this guidance will have on its condensed consolidated financial statements and related disclosures.
|
Segment Information (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of segment information to the totals reported in the accompanying consolidated financial statements | The tables below set forth information about the Company’s reportable operating segments for the three months ended March 31, 2024 and 2023, along with the items necessary to reconcile the segment information to the totals reported in the accompanying condensed consolidated financial statements.
(1) Digital Agreements operating loss includes $0.6 million of amortization of intangible assets expense for both the three months ended March 31, 2024 and 2023.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of the disaggregated revenues to revenues from our two operating segments | The following tables illustrate the disaggregation of revenues by category and services, including a reconciliation of the disaggregated revenues to revenues from the Company’s two reportable operating segments for the three months ended March 31, 2024 and 2023:
(1) Professional services and other includes perpetual software licenses revenue, which was approximately 1% of total revenue for both the three months ended March 31, 2024 and 2023.
|
Revenue from Contracts with Customers (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues disaggregated by geography, major product line and timing of revenue recognition | The following tables present the Company’s revenues disaggregated by major products and services, geographical region and timing of revenue recognition. Revenue by major products and services
(1) Professional services and other includes perpetual software licenses revenue, which was approximately 1% of total revenue for both the three months ended March 31, 2024 and 2023. Revenue by location of customer We classify our sales by customer location in three geographic regions: 1) EMEA, which includes Europe, Middle East and Africa; 2) the Americas, which includes North, Central, and South America; and 3) Asia Pacific (APAC), which includes Australia, New Zealand, and India. The breakdown of revenue in each of our major geographic areas was as follows:
Timing of revenue recognition
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in contract assets and contract liabilities | The following table provides information about receivables, contract assets, and contract liabilities from contracts with customers as of March 31, 2024 and December 31, 2023:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of estimated revenue expected to be recognized in the future | The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of March 31, 2024:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of information related to the capitalized costs and amortization recognized in the current and prior period | The following tables provide information related to the capitalized costs and amortization recognized in the current and prior period:
|
Inventories, net (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of inventories, net | Inventories, net consist of the following:
|
Goodwill (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of goodwill activity | The following table presents the changes in goodwill during the three months ended March 31, 2024:
|
Intangible Assets (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of intangible asset activity | Intangible assets as of March 31, 2024 and December 31, 2023 consist of the following:
|
Property and Equipment, net (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of major classes of property and equipment | The following table presents the major classes of property and equipment, net, as of March 31, 2024 and December 31, 2023:
|
Fair Value Measurements (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of assets that are measured at fair value on a recurring basis | The following tables summarize the Company’s financial assets by level in the fair value hierarchy, which are measured at fair value on a recurring basis, as of March 31, 2024 and December 31, 2023:
|
Allowance for Credit Losses (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||
Credit Loss [Abstract] | |||||||||||||||||||||||||||||||||||||||||||
Schedule change in the allowance for credit losses | The changes in the allowance for credit losses during the three months ended March 31, 2024 were as follows:
|
Leases (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of supplemental consolidated balance sheet information related to our operating leases | Operating lease cost details for the three months ended March 31, 2024 and 2023 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of maturities of operating leases | Maturities of the Company’s operating leases as of March 31, 2024 are as follows:
|
Long-Term Compensation Plan and Stock Based Compensation (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of compensation expense | The following table summarizes stock-based compensation expense and other long-term incentive plan compensation expense for the three months ended March 31, 2024 and 2023:
(1) Stock-based compensation declined for the three months ended March 31, 2024 as compared to the three months ended March 31, 2023, and was primarily due to the departure of the former CEO and forfeitures reversed upon his termination and timing of annual grants. (2) Other long-term incentive compensation consists of immaterial expense for cash incentive awards granted to employees located in jurisdictions where we do not issue stock-based compensation due to tax, regulatory or similar reasons.
|
Earnings per Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Details of earnings per share calculations | The details of the earnings per share calculations for the three months ended March 31, 2024 and 2023 are as follows:
|
Restructuring and Other Related Charges (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in the carrying amount of the restructuring charge liability | The table below sets forth the changes in the carrying amount of the restructuring charge liability for the three months ended March 31, 2024.
|
Description of the Company and Basis of Presentation (Details) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2024
USD ($)
segment
|
Mar. 31, 2023
USD ($)
|
|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of reportable segments | 2 | |
Number of operating segments | 2 | |
Gain (losses) from foreign currency transactions | $ | $ 0.1 | $ (0.2) |
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands |
Mar. 31, 2024 |
Dec. 31, 2023 |
---|---|---|
Accounting Policies [Line Items] | ||
Restricted cash | $ 1,022 | $ 1,037 |
Letter of Credit | ||
Accounting Policies [Line Items] | ||
Restricted cash | 900 | 900 |
Guarantees | ||
Accounting Policies [Line Items] | ||
Restricted cash | $ 100 | $ 100 |
Revenue from Contracts with Customers - Contract balances (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2024 |
Dec. 31, 2023 |
|
Contract balances | ||
Receivables, inclusive of trade and unbilled | $ 32,382 | $ 64,387 |
Contract Assets (current and non-current) | 5,607 | 5,322 |
Contract Liabilities (Deferred Revenue current and non-current) | 59,489 | $ 73,483 |
Revenue recognized that was included in the balance sheet | $ 30,400 | |
Minimum | ||
Contract balances | ||
The amount of time contract assets are transferred to receivables | 2 years | |
Maximum | ||
Contract balances | ||
The amount of time contract assets are transferred to receivables | 5 years |
Revenue from Contracts with Customers - Capitalized Costs and Amortization (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2024 |
Mar. 31, 2023 |
Dec. 31, 2023 |
|
Revenue from Contract with Customer [Abstract] | |||
Amortization period | 7 years | ||
Capitalized costs to obtain contracts, current | $ 3,644 | $ 3,503 | |
Capitalized costs to obtain contracts, non-current | 10,740 | $ 10,766 | |
Amortization of capitalized costs to obtain contracts | $ 884 | $ 731 |
Inventories, net - Summary of Inventories, Net (Details) - USD ($) $ in Thousands |
Mar. 31, 2024 |
Dec. 31, 2023 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Component parts | $ 6,667 | $ 8,511 |
Work-in-process and finished goods | 7,927 | 7,042 |
Total | $ 14,594 | $ 15,553 |
Goodwill - Goodwill Activity (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2024 |
Mar. 31, 2023 |
|
Goodwill [Roll Forward] | ||
Net balance at December 31, 2023 | $ 93,684,000 | |
Foreign currency exchange rate effect | (615,000) | |
Net balance at March 31, 2024 | 93,069,000 | |
Goodwill impairment | 0 | $ 0 |
Digital Agreements | ||
Goodwill [Roll Forward] | ||
Net balance at December 31, 2023 | 20,893,000 | |
Foreign currency exchange rate effect | (134,000) | |
Net balance at March 31, 2024 | 20,759,000 | |
Security Solutions | ||
Goodwill [Roll Forward] | ||
Net balance at December 31, 2023 | 72,791,000 | |
Foreign currency exchange rate effect | (481,000) | |
Net balance at March 31, 2024 | $ 72,310,000 |
Property and Equipment, net (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2024 |
Mar. 31, 2023 |
Dec. 31, 2023 |
|
Property, Plant and Equipment [Line Items] | |||
Total | $ 35,137 | $ 32,251 | |
Accumulated depreciation | (14,791) | (13,529) | |
Property and equipment, net | 20,346 | 18,722 | |
Depreciation expense | 1,400 | $ 700 | |
Office equipment and software | |||
Property, Plant and Equipment [Line Items] | |||
Total | 8,699 | 8,574 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Total | 7,586 | 7,459 | |
Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Total | 3,638 | 3,658 | |
Capitalized software | |||
Property, Plant and Equipment [Line Items] | |||
Total | 15,214 | $ 12,560 | |
Cloud Subscription Agreements | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense directly related to generating revenue | $ 700 | $ 100 |
Allowance for Credit Losses (Details) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2024
USD ($)
| |
Changes in the allowance for credit losses | |
Beginning Balance | $ 1,536 |
Provision for (recovery of) | (48) |
Write-offs | (15) |
Net foreign currency translation | (1) |
Ending Balance | $ 1,472 |
Leases - Schedule of supplemental consolidated balance sheet information related to our operating leases (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2024 |
Mar. 31, 2023 |
|
Lessee, Lease, Description [Line Items] | ||
Total net operating lease costs | $ 659 | $ 773 |
Building rent | ||
Lessee, Lease, Description [Line Items] | ||
Total net operating lease costs | 312 | 523 |
Automobile rentals | ||
Lessee, Lease, Description [Line Items] | ||
Total net operating lease costs | $ 347 | $ 250 |
Leases - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2024 |
Oct. 31, 2023 |
|
Leases [Abstract] | ||
Weighted average remaining lease term | 5 years 2 months 12 days | |
Weighted-average discount rate | 5.00% | |
Cash payments to settle a lease liability reported in cash flows | $ 700 | |
Right-of-use assets obtained in exchange for new lease liabilities | 500 | |
Term of contract | 9 years | |
Total lease payments | $ 8,628 | $ 1,300 |
Leases - Maturities of our operating leases (Details) - USD ($) $ in Thousands |
Mar. 31, 2024 |
Oct. 31, 2023 |
---|---|---|
Maturities of operating leases | ||
2024 | $ 1,792 | |
2025 | 1,687 | |
2026 | 1,594 | |
2027 | 1,411 | |
2028 | 1,304 | |
Later years | 1,347 | |
Less imputed interest | (1,221) | |
Accrued lease termination fees | 714 | |
Total lease liabilities | $ 8,628 | $ 1,300 |
Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2024 |
Mar. 31, 2023 |
|
Income Tax Contingency [Line Items] | ||
Effective tax rate | 15.00% | |
Statutory tax rate | 21.00% | |
Income tax benefit | $ (1,034) | $ (689) |
Income taxes paid | 900 | $ 1,100 |
Administration of the Treasury, Belgium | Settlement with Taxing Authority | Foreign Tax Authority | ||
Income Tax Contingency [Line Items] | ||
Income tax benefit | $ 1,100 |
Long-Term Compensation Plan and Stock Based Compensation (Details) - 2019 Omnibus Incentive Plan - Restricted Stock, subject to time-based criteria $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2024
USD ($)
shares
| |
Plan information | |
Stock based compensation awards issued shares (in shares) | shares | 100,000 |
Restricted stock awards | $ | $ 0.9 |
Vesting period (in years) | 1 year |
Long-Term Compensation Plan and Stock Based Compensation - Allocation of Compensation Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2024 |
Mar. 31, 2023 |
|
Share-Based Payment Arrangement [Abstract] | ||
Stock-based compensation | $ 1,540 | $ 3,812 |
Other long-term incentive plan compensation | 81 | 111 |
Total compensation | $ 1,621 | $ 3,923 |
Earnings per Share - Details of Earnings Per Share Calculations (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2024 |
Mar. 31, 2023 |
|
Earnings Per Share [Abstract] | ||
Net income (loss) | $ 13,468 | $ (8,356) |
Weighted average common shares outstanding: | ||
Basic (in shares) | 38,060 | 40,057 |
Incremental shares with dilutive effect: | ||
Restricted stock units | 403 | 0 |
Diluted (in shares) | 38,463 | 40,057 |
Basic (in dollars per share) | $ 0.35 | $ (0.21) |
Diluted (in dollars per share) | $ 0.35 | $ (0.21) |
Legal Proceedings and Contingencies - Rent expense and purchase obligations (Details) $ in Millions |
Mar. 31, 2024
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
Liabilities accrued | $ 1.2 |
Restructuring and Other Related Charges - Operating costs (Details) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2024
USD ($)
| |
Restructuring Reserve [Roll Forward] | |
Beginning balance | $ 5,015 |
Additions | 1,423 |
Payments | (2,206) |
Ending balance | 4,232 |
Employee Costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 3,130 |
Additions | 1,423 |
Payments | (1,491) |
Ending balance | 3,062 |
Real Estate Rationalization | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 1,885 |
Additions | 0 |
Payments | (715) |
Ending balance | $ 1,170 |
@8R:2X%!MQS8)MDU\IR^0=?:!NWB=E^LI+=$
MTE>U 1/T2S_3KHRA28=IU^C8[4NFECIH51>5S-I@@V>J-HGTC;@DKSWK/S1,
M ,]!;<9=L^/ ]WO:.:@E"]HUZX&S75SL*17;]\D:M,O!;IMKU\H/)V:F2"L7
MLBO7'97O+Z<2H][U0NSZ[2[,8'8<8J]GX2,M6@A:NYT.1Z JP7ZG9V1KE@,]J_QJQ)"% JP(TZP4V-S'[U+2_E"/(/R%H[MX8 CGSG)'$3H2]$
M1YB$08XKD.-.D&<%=#569AS!-@+EO$*U1R!9OD(U?(V(1HDL.(U^,SV^K#5VPRQ&_
MBXJ53VQT]?>_8<_ZARYE=C"W@8FQ^>G*GOK$NY@\':8&I,L($A9#PA(@F)07
M]CXO[(%Y<4XN[)C>0?B(9=L8R_&;J<4R5M8^"-K+!ZJA^1
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M/47](IGD5"Z$\)6/H"[BR6S