x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 05-0605598 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
One Penumbra Place Alameda, CA | 94502 | |
(Address of principal executive offices) | (Zip code) |
Large Accelerated Filer | o | Accelerated Filer | o | |
Non-accelerated filer | x | (Do not check if a smaller reporting Company) | Smaller Reporting Company | o |
Page | ||
June 30, 2016 | December 31, 2015 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 13,914 | $ | 19,547 | ||||
Marketable investments | 125,949 | 129,257 | ||||||
Accounts receivable, net of doubtful accounts of $661 and $589 at June 30, 2016 and December 31, 2015, respectively | 34,577 | 29,444 | ||||||
Inventories | 68,406 | 56,761 | ||||||
Prepaid expenses and other current assets | 17,406 | 9,352 | ||||||
Total current assets | 260,252 | 244,361 | ||||||
Property and equipment, net | 11,864 | 8,951 | ||||||
Deferred taxes | 11,422 | 10,143 | ||||||
Other non-current assets | 441 | 393 | ||||||
Total assets | $ | 283,979 | $ | 263,848 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 4,070 | $ | 2,567 | ||||
Accrued liabilities | 28,119 | 25,581 | ||||||
Total current liabilities | 32,189 | 28,148 | ||||||
Other non-current liabilities | 4,199 | 3,178 | ||||||
Total liabilities | 36,388 | 31,326 | ||||||
Commitments and contingencies (Note 5) | ||||||||
Stockholders’ Equity: | ||||||||
Common stock | 30 | 30 | ||||||
Additional paid-in capital | 266,650 | 252,087 | ||||||
Notes receivable from stockholder | — | (5 | ) | |||||
Accumulated other comprehensive loss | (2,579 | ) | (2,115 | ) | ||||
Accumulated deficit | (16,510 | ) | (17,475 | ) | ||||
Total stockholders’ equity | 247,591 | 232,522 | ||||||
Total liabilities and stockholders’ equity | $ | 283,979 | $ | 263,848 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Revenue | $ | 65,106 | $ | 42,311 | $ | 123,025 | $ | 81,263 | ||||||||
Cost of revenue | 23,636 | 14,936 | 41,650 | 27,160 | ||||||||||||
Gross profit | 41,470 | 27,375 | 81,375 | 54,103 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 6,264 | 4,792 | 11,265 | 7,983 | ||||||||||||
Sales, general and administrative | 35,876 | 26,396 | 68,945 | 45,943 | ||||||||||||
Total operating expenses | 42,140 | 31,188 | 80,210 | 53,926 | ||||||||||||
(Loss) Income from operations | (670 | ) | (3,813 | ) | 1,165 | 177 | ||||||||||
Interest income, net | 559 | 177 | 1,069 | 385 | ||||||||||||
Other expense, net | (272 | ) | (542 | ) | (496 | ) | (498 | ) | ||||||||
(Loss) Income before provision for income taxes | (383 | ) | (4,178 | ) | 1,738 | 64 | ||||||||||
(Benefit from) Provision for income taxes | (568 | ) | (1,507 | ) | 773 | 233 | ||||||||||
Net income (loss) | 185 | (2,671 | ) | 965 | (169 | ) | ||||||||||
Foreign currency translation adjustments, net of tax | (1,881 | ) | 327 | (833 | ) | (589 | ) | |||||||||
Unrealized gains on available-for-sale securities, net of tax | 88 | 193 | 369 | 220 | ||||||||||||
Comprehensive (loss) income | $ | (1,608 | ) | $ | (2,151 | ) | $ | 501 | $ | (538 | ) | |||||
Net income (loss) attributable to common stockholders (Note 9) | $ | 185 | $ | (553 | ) | $ | 965 | $ | (34 | ) | ||||||
Net income (loss) per share attributable to common stockholders —Basic | $ | 0.01 | $ | (0.11 | ) | $ | 0.03 | $ | (0.01 | ) | ||||||
—Diluted | $ | 0.01 | $ | (0.11 | ) | $ | 0.03 | $ | (0.01 | ) | ||||||
Weighted average shares used to compute net income (loss) per share attributable to common stockholders —Basic | 30,210,322 | 5,096,151 | 30,100,162 | 5,000,375 | ||||||||||||
—Diluted | 32,693,684 | 5,096,151 | 32,542,253 | 5,000,375 |
Six Months Ended June 30, | ||||||||
2016 | 2015 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net income (loss) | $ | 965 | $ | (169 | ) | |||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||
Depreciation and amortization | 1,146 | 745 | ||||||
Amortization of premium on marketable investments | 445 | — | ||||||
Stock-based compensation | 6,537 | 3,616 | ||||||
Excess tax benefit from stock-based compensation | (4,373 | ) | — | |||||
Provision for (release of) doubtful accounts | 72 | (101 | ) | |||||
Inventory write downs | 824 | 304 | ||||||
Write off of note receivable | — | 85 | ||||||
(Release of) provision for sales returns | (208 | ) | 223 | |||||
Loss on disposal of property and equipment | 59 | 12 | ||||||
Realized (gain) loss on marketable investments | (2 | ) | 541 | |||||
Provision for product warranty | 23 | 176 | ||||||
Deferred taxes | (207 | ) | — | |||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (5,058 | ) | (4,940 | ) | ||||
Inventories | (12,035 | ) | (11,321 | ) | ||||
Prepaid expenses and other current and non-current assets | (5,508 | ) | (2,759 | ) | ||||
Accounts payable | 1,330 | 548 | ||||||
Accrued expenses and other non-current liabilities | 3,435 | 4,709 | ||||||
Net cash used in operating activities | (12,555 | ) | (8,331 | ) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Purchase of marketable investments | (27,467 | ) | (4,069 | ) | ||||
Proceeds from sales of marketable investments | 28,962 | 52,160 | ||||||
Proceeds from maturities of marketable investments | 2,504 | — | ||||||
Purchases of property and equipment | (3,695 | ) | (3,073 | ) | ||||
Net cash provided by investing activities | 304 | 45,018 | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Payment of deferred issuance costs | — | (964 | ) | |||||
Proceeds from exercises of stock options | 1,493 | 515 | ||||||
Proceeds from issuance of stock under employee stock purchase plan | 3,783 | — | ||||||
Excess tax benefit from stock-based compensation | 4,373 | — | ||||||
Payment of employee taxes related to vested restricted stock | (1,846 | ) | (2,525 | ) | ||||
Net cash provided by (used in) financing activities | 7,803 | (2,974 | ) | |||||
Effect of foreign exchange rate changes on cash and cash equivalents | (1,185 | ) | (239 | ) | ||||
Net (Decrease) Increase In Cash And Cash Equivalents | (5,633 | ) | 33,474 | |||||
CASH AND CASH EQUIVALENTS—Beginning of period | 19,547 | 3,290 | ||||||
CASH AND CASH EQUIVALENTS—End of period | $ | 13,914 | $ | 36,764 | ||||
NONCASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
Purchase of property and equipment funded through accounts payable and accrued liabilities | $ | 560 | $ | 483 | ||||
Deferred issuance costs not yet paid | $ | — | $ | 620 |
As of June 30, 2016 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||
Financial Assets | ||||||||||||||||
Cash equivalents: | ||||||||||||||||
Money market funds | $ | 279 | $ | — | $ | — | $ | 279 | ||||||||
Marketable investments: | ||||||||||||||||
Commercial paper | — | 10,134 | — | 10,134 | ||||||||||||
U.S. Treasury | 15,512 | — | 15,512 | |||||||||||||
U.S. agency securities | — | 13,521 | — | 13,521 | ||||||||||||
U.S. states and municipalities | — | 15,938 | — | 15,938 | ||||||||||||
Corporate bonds | — | 65,081 | — | 65,081 | ||||||||||||
Non-U.S. government debt securities | — | 5,763 | — | 5,763 | ||||||||||||
Total | $ | 15,791 | $ | 110,437 | $ | — | $ | 126,228 |
As of December 31, 2015 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||||
Financial Assets | ||||||||||||||||
Cash equivalents: | ||||||||||||||||
Commercial paper | $ | — | $ | 9,850 | $ | — | $ | 9,850 | ||||||||
Money market funds | 252 | — | — | 252 | ||||||||||||
Marketable investments: | ||||||||||||||||
Commercial paper | — | 22,332 | — | 22,332 | ||||||||||||
U.S. Treasury | 15,436 | — | — | 15,436 | ||||||||||||
U.S. agency securities | — | 21,464 | — | 21,464 | ||||||||||||
U.S. states and municipalities | — | 2,084 | — | 2,084 | ||||||||||||
Corporate bonds | — | 61,002 | — | 61,002 | ||||||||||||
Non-U.S. government debt securities | — | 6,939 | — | 6,939 | ||||||||||||
Total | $ | 15,688 | $ | 123,671 | $ | — | $ | 139,359 |
Allowance for Doubtful Accounts | June 30, 2016 | December 31, 2015 | ||||||
Balance at the beginning of the period | $ | 589 | $ | 602 | ||||
Charged to costs and expenses | 72 | (13 | ) | |||||
Deductions | — | — | ||||||
Balance at the end of the period | $ | 661 | $ | 589 |
June 30, 2016 | December 31, 2015 | |||||||
Prepaid Tax | $ | 6,892 | $ | 2,736 | ||||
Prepaid expenses | 4,753 | 4,706 | ||||||
Income tax receivable | 3,273 | 606 | ||||||
Other current assets | 2,488 | 1,304 | ||||||
Prepaid expenses and other current assets | $ | 17,406 | $ | 9,352 |
June 30, 2016 | ||||||||||||||||
Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
Commercial paper | $ | 10,128 | $ | 6 | $ | — | $ | 10,134 | ||||||||
U.S. Treasury | 15,478 | 34 | — | 15,512 | ||||||||||||
U.S. agency securities | 13,487 | 34 | — | 13,521 | ||||||||||||
U.S. states and municipalities | 15,927 | 11 | — | 15,938 | ||||||||||||
Corporate bonds | 64,847 | 236 | (2 | ) | 65,081 | |||||||||||
Non-U.S. government debt securities | 5,762 | 5 | (4 | ) | 5,763 | |||||||||||
Total | $ | 125,629 | $ | 326 | $ | (6 | ) | $ | 125,949 |
December 31, 2015 | ||||||||||||||||
Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
Commercial paper | $ | 22,328 | $ | 5 | $ | (1 | ) | $ | 22,332 | |||||||
U.S. Treasury | 15,459 | 4 | (27 | ) | 15,436 | |||||||||||
U.S. agency securities | 21,497 | 1 | (34 | ) | 21,464 | |||||||||||
U.S. states and municipalities | 2,086 | — | (2 | ) | 2,084 | |||||||||||
Corporate bonds | 61,188 | 3 | (189 | ) | 61,002 | |||||||||||
Non-U.S. government debt securities | 6,954 | 1 | (16 | ) | 6,939 | |||||||||||
Total | $ | 129,512 | $ | 14 | $ | (269 | ) | $ | 129,257 |
June 30, 2016 | ||||||||
Fair Value | Gross Unrealized Losses | |||||||
U.S. States and Municipalities | 2,022 | — | ||||||
Corporate bonds | 8,174 | (2 | ) | |||||
Non-U.S. government debt securities | 1,836 | (4 | ) | |||||
Total | $ | 12,032 | $ | (6 | ) |
December 31, 2015 | ||||||||
Fair Value | Gross Unrealized Losses | |||||||
Commercial paper | $ | 4,746 | $ | (1 | ) | |||
U.S. Treasury | 12,453 | (27 | ) | |||||
U.S. agency securities | 13,475 | (34 | ) | |||||
U.S. states and municipalities | 2,084 | (2 | ) | |||||
Corporate bonds | 59,163 | (189 | ) | |||||
Non-U.S. government debt securities | 5,881 | (16 | ) | |||||
Total | $ | 97,802 | $ | (269 | ) |
June 30, 2016 | December 31, 2015 | ||||||
Fair Value | |||||||
Due in one year | $ | 105,284 | $ | 62,983 | |||
Due in one to five years | 20,665 | 66,274 | |||||
Total | $ | 125,949 | $ | 129,257 |
June 30, 2016 | December 31, 2015 | |||||||
Raw materials | $ | 10,560 | $ | 9,176 | ||||
Work in process | 3,175 | 2,746 | ||||||
Finished goods | 54,671 | 44,839 | ||||||
Inventories | $ | 68,406 | $ | 56,761 |
June 30, 2016 | December 31, 2015 | |||||||
Machinery and equipment | $ | 9,366 | $ | 8,559 | ||||
Furniture and fixtures | 2,808 | 2,091 | ||||||
Leasehold improvements | 2,360 | 1,564 | ||||||
Software | 1,003 | 666 | ||||||
Computers | 671 | 565 | ||||||
Construction in progress | 1,857 | 577 | ||||||
Total property and equipment | 18,065 | 14,022 | ||||||
Less: Accumulated depreciation and amortization | (6,201 | ) | (5,071 | ) | ||||
Property and equipment, net | $ | 11,864 | $ | 8,951 |
June 30, 2016 | December 31, 2015 | |||||||
Payroll and employee-related expenses | $ | 15,401 | $ | 13,653 | ||||
Sales return reserve | 3,040 | 3,247 | ||||||
Preclinical and clinical trial cost | 1,769 | 1,330 | ||||||
Deferred revenue | 411 | 526 | ||||||
Product warranty | 735 | 713 | ||||||
Sales tax payable | 497 | 531 | ||||||
Income tax payable | 139 | 308 | ||||||
Other accrued liabilities | 6,127 | 5,273 | ||||||
Total accrued liabilities | $ | 28,119 | $ | 25,581 |
June 30, 2016 | December 31, 2015 | |||||||
Balance at the beginning of the period | $ | 713 | $ | 314 | ||||
Provision for product warranty | 345 | 752 | ||||||
Settlements of product warranty claims | (323 | ) | (353 | ) | ||||
Balance at the end of the period | $ | 735 | $ | 713 |
Number of Shares | Weighted- Average Exercise Price | ||||||
Balance at December 31, 2015 | 3,755,345 | $ | 12.13 | ||||
Options exercised | (253,555 | ) | 5.80 | ||||
Options canceled | (11,983 | ) | 19.13 | ||||
Balance at June 30, 2016 | 3,489,807 | 12.56 |
Number of Shares | Weighted Average Grant Date Fair Value | ||||||
Unvested at December 31, 2015 | 849,571 | $ | 15.12 | ||||
Granted | 132,800 | 46.30 | |||||
Vested | (128,675 | ) | 14.38 | ||||
Canceled/Forfeited | (5,000 | ) | 7.75 | ||||
Unvested and expected to vest at June 30, 2016 | 848,696 | 20.16 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Cost of sales | $ | 651 | $ | 71 | $ | 660 | $ | 130 | ||||||||
Research and development | 281 | 160 | 539 | 182 | ||||||||||||
Sales, general and administrative | 2,590 | 3,030 | 5,338 | 3,304 | ||||||||||||
Total | $ | 3,522 | $ | 3,261 | $ | 6,537 | $ | 3,616 |
Three Months Ended June 30, 2016 | Three Months Ended June 30, 2015 | |||||||||||||||||||||||
Marketable Investments | Currency Translation Adjustments | Total | Marketable Investments | Currency Translation Adjustments | Total | |||||||||||||||||||
Balance at beginning of the period | $ | 118 | $ | (904 | ) | $ | (786 | ) | $ | (193 | ) | $ | (1,560 | ) | $ | (1,753 | ) | |||||||
Other comprehensive income before reclassifications: | ||||||||||||||||||||||||
Unrealized gains (losses)—marketable investments | 138 | — | 138 | (179 | ) | — | (179 | ) | ||||||||||||||||
Foreign currency translation gains (losses) | — | (1,875 | ) | (1,875 | ) | — | 347 | 347 | ||||||||||||||||
Income tax effect—benefit (expense) | (49 | ) | (6 | ) | (55 | ) | 44 | (20 | ) | 24 | ||||||||||||||
Net of tax | 89 | (1,881 | ) | (1,792 | ) | (135 | ) | 327 | 192 | |||||||||||||||
Amounts reclassified from accumulated other comprehensive income to earnings: | ||||||||||||||||||||||||
Realized (gains) losses—marketable investments | (2 | ) | — | (2 | ) | 511 | — | 511 | ||||||||||||||||
Income tax effect—benefit (expense) | 1 | — | 1 | (183 | ) | — | (183 | ) | ||||||||||||||||
Net of tax | (1 | ) | — | (1 | ) | 328 | — | 328 | ||||||||||||||||
Net current-year other comprehensive income (loss) | 88 | (1,881 | ) | (1,793 | ) | 193 | 327 | 520 | ||||||||||||||||
Balance at end of the period | $ | 206 | $ | (2,785 | ) | $ | (2,579 | ) | $ | — | $ | (1,233 | ) | $ | (1,233 | ) |
Six Months Ended June 30, 2016 | Six Months Ended June 30, 2015 | |||||||||||||||||||||||
Marketable Investments | Currency Translation Adjustments | Total | Marketable Investments | Currency Translation Adjustments | Total | |||||||||||||||||||
Balance at beginning of the period | $ | (163 | ) | $ | (1,952 | ) | $ | (2,115 | ) | $ | (220 | ) | $ | (644 | ) | $ | (864 | ) | ||||||
Other comprehensive income before reclassifications: | ||||||||||||||||||||||||
Unrealized gains (losses)—marketable investments | 580 | — | 580 | (162 | ) | — | (162 | ) | ||||||||||||||||
Foreign currency translation gains (losses) | — | (832 | ) | (832 | ) | — | (681 | ) | (681 | ) | ||||||||||||||
Income tax effect—benefit (expense) | (209 | ) | (1 | ) | (210 | ) | 36 | 92 | 128 | |||||||||||||||
Net of tax | 371 | (833 | ) | (462 | ) | (126 | ) | (589 | ) | (715 | ) | |||||||||||||
Amounts reclassified from accumulated other comprehensive income to earnings: | ||||||||||||||||||||||||
Realized (gains) losses—marketable investments | (3 | ) | — | (3 | ) | 541 | — | 541 | ||||||||||||||||
Income tax effect—benefit | 1 | — | 1 | (195 | ) | — | (195 | ) | ||||||||||||||||
Net of tax | (2 | ) | — | (2 | ) | 346 | — | 346 | ||||||||||||||||
Net current-year other comprehensive income (loss) | 369 | (833 | ) | (464 | ) | 220 | (589 | ) | (369 | ) | ||||||||||||||
Balance at end of the period | $ | 206 | $ | (2,785 | ) | $ | (2,579 | ) | $ | — | $ | (1,233 | ) | $ | (1,233 | ) |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Net income per share: | ||||||||||||||||
Numerator | ||||||||||||||||
Net income (Loss) | $ | 185 | $ | (2,671 | ) | $ | 965 | $ | (169 | ) | ||||||
Less: Undistributed income attributable to preferred stockholders | — | 2,118 | — | 135 | ||||||||||||
Net income (Loss) attributable to common stockholders—basic and diluted | $ | 185 | $ | (553 | ) | $ | 965 | $ | (34 | ) | ||||||
Denominator | ||||||||||||||||
Weighted average shares used to compute net income attributable to common stockholders —Basic | 30,210,322 | 5,096,151 | 30,100,162 | 5,000,375 | ||||||||||||
Potential dilutive options and ESPP shares, as calculated using treasury stock method | 2,088,651 | — | 2,074,286 | — | ||||||||||||
Potential dilutive restricted stock and restricted stock units, as calculated using treasury stock method | 394,711 | — | 367,805 | — | ||||||||||||
Weighted average shares used to compute net income attributable to common stockholders —Diluted | 32,693,684 | 5,096,151 | 32,542,253 | 5,000,375 | ||||||||||||
Net income (Loss) per share attributable to common stockholders —Basic | $ | 0.01 | $ | (0.11 | ) | $ | 0.03 | $ | (0.01 | ) | ||||||
—Diluted | $ | 0.01 | $ | (0.11 | ) | $ | 0.03 | $ | (0.01 | ) |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||
Options and ESPP to purchase common stock | — | 2,485,392 | 4,007 | 2,485,392 | ||||||||
Restricted stock and restricted stock units | 15,210 | 755,771 | 34,928 | 755,771 | ||||||||
Total | 15,210 | 3,241,163 | 38,935 | 3,241,163 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
United States | $ | 43,692 | $ | 27,619 | $ | 83,104 | $ | 53,970 | ||||||||
Japan | 6,570 | 4,152 | 12,730 | 8,610 | ||||||||||||
Other International | 14,844 | 10,540 | 27,191 | 18,683 | ||||||||||||
Total | $ | 65,106 | $ | 42,311 | $ | 123,025 | $ | 81,263 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Neuro | $ | 45,362 | $ | 34,400 | $ | 86,646 | $ | 66,054 | ||||||||
Peripheral Vascular | 19,744 | 7,911 | 36,379 | 15,209 | ||||||||||||
Total | $ | 65,106 | $ | 42,311 | $ | 123,025 | $ | 81,263 |
• | The rate at which we grow our salesforce and the speed at which newly hired salespeople become fully effective can impact our revenue growth or our costs incurred in anticipation of such growth. |
• | Our industry is intensely competitive and, in particular, we compete with a number of large, well-capitalized companies. We must continue to successfully compete in light of our competitors’ existing and future products and their resources to successfully market to the specialist physicians who use our products. |
• | We must continue to successfully introduce new products that gain acceptance with specialist physicians and successfully transition from existing products to new products, ensuring adequate supply while avoiding excess inventory of older products and resulting inventory write-downs or write-offs. In addition, as we introduce new products, we generally hire and train additional personnel and build our inventory of components and finished goods in advance of sales, which may cause quarterly fluctuations in our financial condition. |
• | Publications of clinical results by us, our competitors and other third parties can have a significant influence on whether, and the degree to which, our products are used by specialist physicians and the procedures and treatments those physicians choose to administer for a given condition. |
• | The specialist physicians who use our products may not perform procedures during certain times of the year, such as those periods when they are at major medical conferences or are away from their practices for other reasons, the timing of which occurs irregularly during the year and from year to year. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
(in thousands, except for percentages) | |||||||||||||||||||||||||||
Revenue | $ | 65,106 | 100.0 | % | $ | 42,311 | 100.0 | % | $ | 123,025 | 100.0 | % | $ | 81,263 | 100.0 | % | |||||||||||
Cost of revenue | 23,636 | 36.3 | % | 14,936 | 35.3 | % | 41,650 | 33.9 | % | 27,160 | 33.4 | % | |||||||||||||||
Gross profit | 41,470 | 63.7 | % | 27,375 | 64.7 | % | 81,375 | 66.1 | % | 54,103 | 66.6 | % | |||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||
Research and development | 6,264 | 9.6 | % | 4,792 | 11.3 | % | 11,265 | 9.2 | % | 7,983 | 9.8 | % | |||||||||||||||
Sales, general and administrative | 35,876 | 55.1 | % | 26,396 | 62.4 | % | 68,945 | 56.0 | % | 45,943 | 56.5 | % | |||||||||||||||
Total operating expenses | 42,140 | 64.7 | % | 31,188 | 73.7 | % | 80,210 | 65.2 | % | 53,926 | 66.4 | % | |||||||||||||||
Income (expense) from operations | (670 | ) | (1.0 | )% | (3,813 | ) | (9.0 | )% | 1,165 | 0.9 | % | 177 | 0.2 | % | |||||||||||||
Interest income, net | 559 | 0.9 | % | 177 | 0.4 | % | 1,069 | 0.9 | % | 385 | 0.5 | % | |||||||||||||||
Other expense, net | (272 | ) | (0.4 | )% | (542 | ) | (1.3 | )% | (496 | ) | (0.4 | )% | (498 | ) | (0.6 | )% | |||||||||||
Income before provision for (benefit from) income taxes | (383 | ) | (0.6 | )% | (4,178 | ) | (9.9 | )% | 1,738 | 1.4 | % | 64 | 0.1 | % | |||||||||||||
Provision for (benefit from) income taxes | (568 | ) | (0.9 | )% | (1,507 | ) | (3.6 | )% | 773 | 0.6 | % | 233 | 0.3 | % | |||||||||||||
Net income (loss) | $ | 185 | 0.3 | % | $ | (2,671 | ) | (6.3 | )% | $ | 965 | 0.8 | % | $ | (169 | ) | (0.2 | )% |
Three Months Ended June 30, | Change | |||||||||||||
2016 | 2015 | $ | % | |||||||||||
(in thousands, except for percentages) | ||||||||||||||
Neuro | $ | 45,362 | $ | 34,400 | $ | 10,962 | 31.9 | % | ||||||
Peripheral Vascular | 19,744 | 7,911 | 11,833 | 149.6 | % | |||||||||
Total | $ | 65,106 | $ | 42,311 | $ | 22,795 | 53.9 | % |
Three Months Ended June 30, | Change | |||||||||||||
2016 | 2015 | $ | % | |||||||||||
(in thousands, except for percentages) | ||||||||||||||
Cost of revenue | $ | 23,636 | $ | 14,936 | $ | 8,700 | 58.2 | % | ||||||
Gross profit | $ | 41,470 | $ | 27,375 | $ | 14,095 | 51.5 | % | ||||||
Gross margin % | 63.7 | % | 64.7 | % |
Three Months Ended June 30, | Change | |||||||||||||
2016 | 2015 | $ | % | |||||||||||
(in thousands, except for percentages) | ||||||||||||||
R&D | $ | 6,264 | $ | 4,792 | $ | 1,472 | 30.7 | % | ||||||
R&D as a percentage of revenue | 9.6 | % | 11.3 | % |
Three Months Ended June 30, | Change | |||||||||||||
2016 | 2015 | $ | % | |||||||||||
(in thousands, except for percentages) | ||||||||||||||
SG&A | $ | 35,876 | $ | 26,396 | $ | 9,480 | 35.9 | % | ||||||
SG&A as a percentage of revenue | 55.1 | % | 62.4 | % |
Three Months Ended June 30, | Change | |||||||||||||
2016 | 2015 | $ | % | |||||||||||
(in thousands, except for percentages) | ||||||||||||||
Provision for (benefit from) income taxes | $ | (568 | ) | $ | (1,507 | ) | $ | 939 | (62.3 | )% | ||||
Effective tax rate | 148.3 | % | 36.1 | % |
Six Months Ended June 30, | Change | |||||||||||||
2016 | 2015 | $ | % | |||||||||||
(in thousands, except for percentages) | ||||||||||||||
Neuro | $ | 86,646 | $ | 66,054 | $ | 20,592 | 31.2 | % | ||||||
Peripheral Vascular | 36,379 | 15,209 | 21,170 | 139.2 | % | |||||||||
Total | $ | 123,025 | $ | 81,263 | $ | 41,762 | 51.4 | % |
Six Months Ended June 30, | Change | |||||||||||||
2016 | 2015 | $ | % | |||||||||||
(in thousands, except for percentages) | ||||||||||||||
Cost of revenue | $ | 41,650 | $ | 27,160 | $ | 14,490 | 53.4 | % | ||||||
Gross profit | $ | 81,375 | $ | 54,103 | $ | 27,272 | 50.4 | % | ||||||
Gross margin % | 66.1 | % | 66.6 | % |
Six Months Ended June 30, | Change | |||||||||||||
2016 | 2015 | $ | % | |||||||||||
(in thousands, except for percentages) | ||||||||||||||
R&D | $ | 11,265 | $ | 7,983 | $ | 3,282 | 41.1 | % | ||||||
R&D as a percentage of revenue | 9.2 | % | 9.8 | % |
Six Months Ended June 30, | Change | |||||||||||||
2016 | 2015 | $ | % | |||||||||||
(in thousands, except for percentages) | ||||||||||||||
SG&A | $ | 68,945 | $ | 45,943 | $ | 23,002 | 50.1 | % | ||||||
SG&A as a percentage of revenue | 56.0 | % | 56.5 | % |
Six Months Ended June 30, | Change | ||||||||||||
2016 | 2015 | $ | % | ||||||||||
(in thousands, except for percentages) | |||||||||||||
Provision for income taxes | $ | 773 | $ | 233 | $ | 540 | nm | ||||||
Effective tax rate | 44.5 | % | 364.1 | % |
June 30, 2016 | December 31, 2015 | ||||||
(in thousands) | |||||||
Cash and cash equivalents | $ | 13,914 | $ | 19,547 | |||
Marketable investments | 125,949 | 129,257 | |||||
Accounts receivable, net | 34,577 | 29,444 | |||||
Accounts payable | 4,070 | 2,567 | |||||
Accrued liabilities | 28,119 | 25,581 | |||||
Working capital(1) | 228,063 | 216,213 |
(1) | Working capital consists of total current assets less total current liabilities. |
Six Months Ended June 30, | |||||||
2016 | 2015 | ||||||
(in thousands) | |||||||
Cash and cash equivalents at beginning of period | $ | 19,547 | $ | 3,290 | |||
Net cash used in operating activities | (12,555 | ) | (8,331 | ) | |||
Net cash provided by investing activities | 304 | 45,018 | |||||
Net cash provided by (used in) financing activities | 7,803 | (2,974 | ) | ||||
Cash and cash equivalents at end of period | 13,914 | 36,764 |
Exhibit Number | Description | Form | File No. | Exhibit(s) | Filing Date | |||||
31.1* | Certification of Principal Executive Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended. | |||||||||
31.2* | Certification of Principal Financial Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended. | |||||||||
32.1** | Certification of Principal Executive Officer and Principal Financial Officer Required Under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. §1350. | |||||||||
101* | The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2016 formatted in Extensible Business Reporting Language (XBRL) includes: (i) Condensed Consolidated Balance Sheets as of June 30, 2016 and December 31, 2015, (ii) Condensed Consolidated Statements of Income and Comprehensive Income (Loss) for the three and six months ended June 30, 2016 and 2015, (iii) Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2016 and 2015, and (iv) Notes to Condensed Consolidated Financial Statements. |
PENUMBRA, INC. | ||
Date: August 9, 2016 | ||
By: | /s/ Sri Kosaraju | |
Sri Kosaraju | ||
Chief Financial Officer and Head of Strategy | ||
(Principal Financial and Accounting Officer) |
1. | I have reviewed this Quarterly Report on Form 10-Q of Penumbra, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | (Omitted pursuant to Exchange Act Rule 13a-14); |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Adam Elsesser |
Adam Elsesser |
Chairman, Chief Executive Officer and President |
1. | I have reviewed this Quarterly Report on Form 10-Q of Penumbra, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | (Omitted pursuant to Exchange Act Rule 13a-14); |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Sri Kosaraju |
Sri Kosaraju |
Chief Financial Officer and Head of Strategy |
• | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
• | The information in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Adam Elsesser |
Adam Elsesser |
Chairman, Chief Executive Officer and President |
/s/ Sri Kosaraju |
Sri Kosaraju |
Chief Financial Officer and Head of Strategy |
Document and Entity Information Document - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jul. 15, 2016 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Penumbra Inc | |
Entity Central Index Key | 0001321732 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2016 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 31,054,604 |
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
---|---|---|---|
Statement of Financial Position [Abstract] | |||
Allowance for doubtful accounts | $ 661 | $ 589 | $ 602 |
Organization and Description of Business |
6 Months Ended |
---|---|
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of Business Penumbra, Inc. (the “Company”) is a global interventional therapies company that designs, develops, manufactures and markets innovative medical devices. The Company has a broad portfolio of products that addresses challenging medical conditions and significant clinical needs across two major markets, neuro and peripheral vascular. The conditions that the Company’s products address include, among others, ischemic stroke, hemorrhagic stroke and various peripheral vascular conditions that can be treated through thrombectomy and embolization procedures. |
Summary of Significant Accounting Policies |
6 Months Ended |
---|---|
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation and Consolidation The accompanying condensed consolidated balance sheet as of June 30, 2016, the condensed consolidated statements of operations and comprehensive income (loss) for the three and six months ended June 30, 2016 and 2015, and the condensed consolidated statements of cash flows for the six months ended June 30, 2016 and 2015 are unaudited. The unaudited condensed consolidated financial statements included herein have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. The condensed consolidated balance sheet as of December 31, 2015 was derived from the audited financial statements as of that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments of a normal recurring nature considered necessary to state fairly the Company’s financial position as of June 30, 2016, the results of its operations for the three and six months ended June 30, 2016 and 2015, and the cash flows for the six months ended June 30, 2016 and 2015. The results for the three and six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016 or for any other future annual or interim period. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2015 included in the Company’s Annual Report on Form 10-K. There have been no changes to the Company’s significant accounting policies during the six months ended June 30, 2016, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and equity accounts; disclosure of contingent assets and liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including those related to marketable investments, provisions for doubtful accounts, sales return reserve, warranty reserves, valuation of inventories, useful lives of property and equipment, income taxes, and contingencies, among others. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other data. Actual results could differ from those estimates. Segments The Company determined its operating segment on the same basis that it uses to evaluate its performance internally. The Company has one business activity: the design, development, manufacturing and marketing of innovative medical devices, and operates as one operating segment. The Company’s chief operating decision-maker, its Chief Executive Officer, reviews its operating results for the purpose of allocating resources and evaluating financial performance. The Company determines revenue by geographic area, based on the destination to which it ships its products. Recently Issued Accounting Standards In May 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, which outlines a comprehensive new revenue recognition model designed to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers—Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which further clarifies the implementation guidance on principal versus agent considerations contained in ASU 2014-09. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers—Identifying Performance Obligations and Licensing, which further clarifies the implementation guidance relating to identifying performance obligations and the licensing implementation guidance. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers—Narrow-Scope improvements and Practical Expedients, which further clarifies the implementation on narrow scope improvements and practical expedients. These standards will be effective for the Company in the first quarter of 2018 pursuant to ASU No. 2015-14, Revenue from Contracts with Customers-Deferral of the Effective Date, issued by the FASB in August 2015. The Company is currently evaluating the impact of adopting these standards. In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory, which requires an entity to measure most inventory at the lower of cost and net realizable value, thereby simplifying the current guidance under which an entity must measure inventory at the lower of cost or market. The accounting standard is effective prospectively for annual periods beginning after December 15, 2016, and interim periods therein. Early adoption is permitted as of the beginning of an interim or annual reporting period. The Company is currently evaluating the impact of adopting this standard. In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, which addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The new standard is effective for annual periods and interim periods beginning after December 15, 2017 and, upon adoption, an entity should apply the amendments by means of a cumulative-effect adjustment to the balance sheet at the beginning of the first reporting period in which the guidance is effective. Early adoption is not permitted except for the provision to record fair value changes for financial liabilities under the fair value option resulting from instrument-specific credit risk in other comprehensive income. The Company is currently evaluating the impact of adopting this standard. In February 2016, the FASB issued ASU 2016-02, Leases, which amends the existing accounting standards for leases. Under the new guidance, a lessee will be required to recognize a lease liability and right-of-use asset for all leases with terms in excess of twelve months. The new guidance also modifies the classification criteria and accounting for sales-type and direct financing leases, and requires additional disclosures to enable users of financial statements to understand the amount, timing, and uncertainty of cash flows arising from leases. Consistent with current guidance, a lessee’s recognition, measurement, and presentation of expenses and cash flows arising from a lease will continue to depend primarily on its classification. The accounting standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and must be applied using a modified retrospective approach. Early adoption is permitted. The Company is currently evaluating the impact of adopting this standard. In March 2016, the FASB issued ASU No. 2016-09, Stock Compensation—Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The accounting standard is effective for annual periods beginning after December 15, 2016, including interim periods within those annual periods. Early adoption is permitted in any interim or annual period. The Company is currently evaluating the impact of adopting this standard. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses. The standard changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The Company will recognize an allowance for credit losses on available-for-sale securities rather than deductions in amortized cost. The standard is effective for fiscal years and interim periods beginning after December 15, 2019. Early adoption is permitted for all periods beginning after December 15, 2018. The Company is currently evaluating the impact of adopting this standard. |
Fair Value of Financial Instruments |
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Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The categorization of a financial instrument within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company classifies its cash equivalents and marketable investments within Level 1 and Level 2, as it uses quoted market prices or alternative pricing sources and models utilizing market observable inputs. The Company determined the fair value of its Level 1 financial instruments, which are traded in active markets, using quoted market prices for identical instruments. Marketable investments classified within Level 2 of the fair value hierarchy are valued based on other observable inputs, including broker or dealer quotations or alternative pricing sources. When quoted prices in active markets for identical assets or liabilities are not available, the Company relies on non-binding quotes from its investment managers, which are based on proprietary valuation models of independent pricing services. These models generally use inputs such as observable market data, quoted market prices for similar instruments, historical pricing trends of a security relative to its peers and internal assumptions of the independent pricing services. To validate the fair value determination provided by its investment managers, the Company reviews the pricing movement in the context of overall market trends and trading information from its investment managers. In addition, the Company assesses the inputs and methods used in determining the fair value in order to determine the classification of securities in the fair value hierarchy. The Company did not own any Level 3 financial assets or liabilities as of June 30, 2016 or December 31, 2015. During the three and six months ended June 30, 2016 and 2015, the Company did not record impairment charges related to its marketable investments, and the Company did not have any transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy. The Company did not have any financial assets and liabilities measured at fair value on a non-recurring basis as of June 30, 2016 or December 31, 2015. The following table sets forth the Company’s financial assets and liabilities measured at fair value by level within the fair value hierarchy (in thousands):
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Balance Sheet Components |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet Components | Balance Sheet Components Cash and Cash Equivalents The majority of the Company’s cash is held by one financial institution in the United States in excess of federally insured limits. The Company maintained investments in money market funds that were not federally insured during the periods presented and held cash in foreign banks of approximately $2.7 million and $1.9 million at June 30, 2016 and December 31, 2015, respectively, that were not federally insured. The Company has not experienced any losses on its deposits of cash and cash equivalents. Accounts Receivable, Net The Company’s allowance for doubtful accounts comprised of the following (in thousands):
One customer (a distributor) accounted for 10% of the Company’s revenue for each of the three and six months ended June 30, 2016 and 2015. No customer accounted for greater than 10% of the Company’s accounts receivable balance as of June 30, 2016 or December 31, 2015. Prepaid Expenses and Other Current Assets The Company’s prepaid expenses and other current assets as of June 30, 2016 and December 31, 2015 were comprised of the following (in thousands):
Marketable Investments The Company’s marketable investments as of June 30, 2016 and December 31, 2015 were as follows (in thousands):
The following tables present the gross unrealized losses and the fair value for those marketable investments that were in an unrealized loss position for less than twelve months as of June 30, 2016 and December 31, 2015 (in thousands):
As of June 30, 2016 and December 31, 2015, there were no securities that had been in a loss position for more than twelve months. The contractual maturities of the Company’s marketable investments as of June 30, 2016 and December 31, 2015 were as follows (in thousands):
Inventories Inventories are stated at the lower of cost (determined under the first-in first-out method) or market. Inventory quantities are reviewed in consideration of actual loss experience, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. The components of inventories as of June 30, 2016 and December 31, 2015 consisted of the following (in thousands):
Property and Equipment, Net Property and equipment, net as of June 30, 2016 and December 31, 2015 consisted of the following (in thousands):
Depreciation and amortization expense was $0.6 million and $0.4 million for the three months ended June 30, 2016 and 2015, respectively, and was $1.1 million and $0.7 million for the six months ended June 30, 2016 and 2015, respectively. Accrued Liabilities The following table shows the components of accrued liabilities as of June 30, 2016 and December 31, 2015 (in thousands):
The estimated product warranty accrual as of June 30, 2016 and December 31, 2015 was as follows (in thousands):
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Commitments and Contingencies |
6 Months Ended |
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Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Commitments The Company leases its offices and other equipment under non-cancelable operating leases that expire at various dates from 2029 to 2031. Rent expense for non-cancelable operating leases with scheduled rent increases is recognized on a straight-line basis over the lease term. Rent expense for the three months ended June 30, 2016 and 2015 was $1.3 million and $0.8 million, respectively and for the six months ended June 30, 2016 and 2015 was $2.4 million and $1.4 million, respectively. In addition, the Company's lease commitments also require it to make additional payments during the lease term for taxes, insurance and other operating expenses. Royalty Obligations In March 2005, the Company entered into a license agreement that requires the Company to make minimum royalty payments to the licensor on a quarterly basis. As of both June 30, 2016 and December 31, 2015, the license agreement required minimum annual royalty payments of $0.1 million in equal quarterly installments. On each January 1, the quarterly calendar year minimum royalty will be adjusted to equal the prior year’s minimum royalty adjusted by a percentage equal to the percentage change in the “consumer price index for all urban consumers” for the prior calendar year as reported by the U.S. Department of Labor. Unless terminated earlier, the term of the license agreement will continue until the expiration of the last to expire patent that covers that licensed product or 2022, whichever is longer. In April 2012, the Company entered into an agreement that requires the Company to pay, on a quarterly basis, a 5% royalty on sales of products covered under applicable patents. Unless the agreement is terminated earlier, the royalty term for each applicable product will continue until the expirations of the applicable patent covering such product or 2029, whichever is longer. In November 2013, the Company entered into an agreement that requires the Company to pay, on a quarterly basis, a 3% royalty on the first $5 million in sales and a 1% royalty on sales thereafter of products covered under applicable patents. Unless the agreement is terminated earlier, the royalty for each covered product shall continue until 2030. In April 2015, the Company entered into a royalty agreement that requires the Company to pay, on a quarterly basis, a 2% royalty on sales of certain products covered by the agreement. Unless the royalty agreement is terminated earlier, the royalty term for each covered product shall continue until 2035. Royalty expense included in cost of sales for the three months ended June 30, 2016 and 2015 was $0.7 million and $0.4 million, respectively and for the six months ended June 30, 2016 and 2015 was $1.4 million and $0.8 million, respectively. Contingencies From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. Indemnification The Company enters into standard indemnification arrangements in the ordinary course of business. In many such arrangements, the Company agrees to indemnify, hold harmless, and reimburse the indemnified parties for losses suffered or incurred by the indemnified parties in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with any of these indemnification requirements has been recorded to date. Litigation The Company was contacted in 2015 by the attorney for a potential product liability claimant who allegedly suffered injuries as a result of an aneurysm procedure in which the Penumbra Coil 400 was used. On February 19, 2016, a complaint for damages was filed on behalf of this claimant against the Company and the hospital involved in the procedure (Montgomery v. Penumbra, Inc., et al., Case No. 16-2-04050-1 SEA, Superior Court of the State of Washington, King County). The suit alleges liability primarily under the Washington Product Liability Act and seeks both compensatory and punitive damages without a specific damages claim. Counsel for the claimant previously indicated that he expects that a jury could award $35 million in damages were this matter to go to trial. This amount is substantially in excess of the Company’s insurance coverage. The hospital defendant had requested indemnification from the Company but was dismissed from the case in July 2016. As formal discovery has only recently commenced, the Company is unable to assess the merits of the plaintiff’s case. The Company intends to vigorously defend the litigation, as the Company believes there will be substantial questions regarding causation, liability and damages. From time to time, the Company is subject to claims and assessments in the ordinary course of business. The Company is not currently a party to any litigation matter that, individually or in the aggregate, is expected to have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows. |
Stock-based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based Compensation | Stock-Based Compensation Stock Options Activity of stock options under the Penumbra, Inc. 2005 Stock Plan, the Penumbra, Inc. 2011 Equity Incentive Plan and the Amended and Restated Penumbra, Inc. 2014 Equity Incentive Plan (collectively “the Plans”) during the six months ended June 30, 2016 is set forth below:
Restricted Stock and Restricted Stock Units The following table summarizes the activity of unvested restricted stock and restricted stock units under the Plans during the six months ended June 30, 2016 is set forth below:
Employee Stock Purchase Plan Under the Penumbra, Inc. Employee Stock Purchase Plan (“ESPP”), employees purchased 148,354 shares for $3.8 million during each of the three and six months ended June 30, 2016. Stock-based Compensation The following table sets forth the stock-based compensation expense included in the condensed consolidated statements of operations and comprehensive income (loss) for the three and six months ended June 30, 2016 and 2015 (in thousands):
As of June 30, 2016, total unrecognized compensation cost was $27.6 million related to unvested share-based compensation arrangements which is expected to be recognized over a weighted average period of 2.7 years. The total stock-based compensation cost capitalized in inventory was $0.6 million and $0.3 million as of June 30, 2016 and December 31, 2015, respectively. |
Accumulated Other Comprehensive Income (Loss) |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Other comprehensive income (loss) consists of two components: unrealized gains or losses on the Company’s available-for-sale marketable investments, and gains or losses from foreign currency translation adjustments. Until realized and reported as a component of net income, these comprehensive income items accumulate and are included within accumulated other comprehensive income (loss). Unrealized gains and losses on the Company’s marketable investments are reclassified from accumulated other comprehensive income (loss) into earnings when realized upon sale, and are determined based on specific identification of securities sold. Gains and losses from the translation of assets and liabilities denominated in non-U.S. dollar functional currencies are included in accumulated other comprehensive income (loss). The following table summarizes the changes in the accumulated balances during the three and six months ended June 30, 2016 and 2015, and includes information regarding the manner in which the reclassifications out of accumulated other comprehensive income (loss) into earnings affect the Company’s condensed consolidated statements of operations and comprehensive income (loss) (in thousands):
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Income Taxes |
6 Months Ended |
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Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s income tax expense, deferred tax assets and liabilities, and reserves for unrecognized tax benefits reflect management’s best assessment of estimated current and future taxes to be paid. The Company is subject to income taxes in both the United States and foreign jurisdictions. Significant judgments and estimates are required in determining the consolidated income tax expense. The interim period effective tax rate is based on a forecast of the Company’s full year results. The Company’s effective tax rate increased to 148.3% for the three months ended June 30, 2016, compared to 36.1% for the three months ended June 30, 2015 primarily attributable to forecasted income and losses. The effective tax rate decreased to 44.5% for the six months ended June 30, 2016, compared to 364.1% for the six months ended June 30, 2015 primarily attributable to forecasted income and losses. |
Net Income per Share of Common Stock attributable to Common Stockholders |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income per Share of Common Stock attributable to Common Stockholders | Net Income per Share of Common Stock attributable to Common Stockholders The Company calculated its basic and diluted net income per share attributable to common stockholders for the three and six months ended June 30, 2015 in conformity with the two-class method required for companies with participating securities. Under the two-class method, the Company determined whether it had net income attributable to common stockholders, which included the results of operations less current period preferred stock non-cumulative dividends. If it was determined that the Company did have net income attributable to common stockholders during a period, the related undistributed earnings were then allocated between common stock and the preferred stock based on the weighted average number of shares outstanding during the period to determine the numerator for the basic net income per share attributable to common stockholders. In computing diluted net income attributable to common stockholders, undistributed earnings were re-allocated to reflect the potential impact of dilutive securities to determine the numerator for the diluted net income per share attributable to common stockholders. The Company’s basic net income per share attributable to common stockholders is calculated by dividing the net income by the weighted average number of shares of common stock outstanding for the period. The diluted net income per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of this calculation, options to purchase common stock, restricted stock and common stock warrants are considered common stock equivalents. A reconciliation of the numerator and denominator used in the calculation of the basic and diluted net income per share attributable to common stockholders for the three and six months ended June 30, 2016 and 2015 is as follows (in thousands, except share and per share amounts):
The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net income per share of common stock for the periods presented, because the effect of including them would have been anti-dilutive:
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Geographic Areas and Product Sales |
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Geographic Areas and Product Sales | Geographic Areas and Product Sales The Company’s revenue by geographic area, based on the destination to which the Company ships its products, for the three and six months ended June 30, 2016 and 2015 was as follows (in thousands):
The following table sets forth revenue by product category (in thousands):
The Company does not have significant long-lived assets outside the U.S. |
Summary of Significant Accounting Policies (Policies) |
6 Months Ended |
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Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation and Consolidation The accompanying condensed consolidated balance sheet as of June 30, 2016, the condensed consolidated statements of operations and comprehensive income (loss) for the three and six months ended June 30, 2016 and 2015, and the condensed consolidated statements of cash flows for the six months ended June 30, 2016 and 2015 are unaudited. The unaudited condensed consolidated financial statements included herein have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. The condensed consolidated balance sheet as of December 31, 2015 was derived from the audited financial statements as of that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments of a normal recurring nature considered necessary to state fairly the Company’s financial position as of June 30, 2016, the results of its operations for the three and six months ended June 30, 2016 and 2015, and the cash flows for the six months ended June 30, 2016 and 2015. The results for the three and six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016 or for any other future annual or interim period. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2015 included in the Company’s Annual Report on Form 10-K. There have been no changes to the Company’s significant accounting policies during the six months ended June 30, 2016, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and equity accounts; disclosure of contingent assets and liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including those related to marketable investments, provisions for doubtful accounts, sales return reserve, warranty reserves, valuation of inventories, useful lives of property and equipment, income taxes, and contingencies, among others. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other data. Actual results could differ from those estimates. |
Segments | Segments The Company determined its operating segment on the same basis that it uses to evaluate its performance internally. The Company has one business activity: the design, development, manufacturing and marketing of innovative medical devices, and operates as one operating segment. The Company’s chief operating decision-maker, its Chief Executive Officer, reviews its operating results for the purpose of allocating resources and evaluating financial performance. The Company determines revenue by geographic area, based on the destination to which it ships its products. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In May 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, which outlines a comprehensive new revenue recognition model designed to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers—Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which further clarifies the implementation guidance on principal versus agent considerations contained in ASU 2014-09. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers—Identifying Performance Obligations and Licensing, which further clarifies the implementation guidance relating to identifying performance obligations and the licensing implementation guidance. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers—Narrow-Scope improvements and Practical Expedients, which further clarifies the implementation on narrow scope improvements and practical expedients. These standards will be effective for the Company in the first quarter of 2018 pursuant to ASU No. 2015-14, Revenue from Contracts with Customers-Deferral of the Effective Date, issued by the FASB in August 2015. The Company is currently evaluating the impact of adopting these standards. In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory, which requires an entity to measure most inventory at the lower of cost and net realizable value, thereby simplifying the current guidance under which an entity must measure inventory at the lower of cost or market. The accounting standard is effective prospectively for annual periods beginning after December 15, 2016, and interim periods therein. Early adoption is permitted as of the beginning of an interim or annual reporting period. The Company is currently evaluating the impact of adopting this standard. In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, which addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The new standard is effective for annual periods and interim periods beginning after December 15, 2017 and, upon adoption, an entity should apply the amendments by means of a cumulative-effect adjustment to the balance sheet at the beginning of the first reporting period in which the guidance is effective. Early adoption is not permitted except for the provision to record fair value changes for financial liabilities under the fair value option resulting from instrument-specific credit risk in other comprehensive income. The Company is currently evaluating the impact of adopting this standard. In February 2016, the FASB issued ASU 2016-02, Leases, which amends the existing accounting standards for leases. Under the new guidance, a lessee will be required to recognize a lease liability and right-of-use asset for all leases with terms in excess of twelve months. The new guidance also modifies the classification criteria and accounting for sales-type and direct financing leases, and requires additional disclosures to enable users of financial statements to understand the amount, timing, and uncertainty of cash flows arising from leases. Consistent with current guidance, a lessee’s recognition, measurement, and presentation of expenses and cash flows arising from a lease will continue to depend primarily on its classification. The accounting standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and must be applied using a modified retrospective approach. Early adoption is permitted. The Company is currently evaluating the impact of adopting this standard. In March 2016, the FASB issued ASU No. 2016-09, Stock Compensation—Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The accounting standard is effective for annual periods beginning after December 15, 2016, including interim periods within those annual periods. Early adoption is permitted in any interim or annual period. The Company is currently evaluating the impact of adopting this standard. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses. The standard changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The Company will recognize an allowance for credit losses on available-for-sale securities rather than deductions in amortized cost. The standard is effective for fiscal years and interim periods beginning after December 15, 2019. Early adoption is permitted for all periods beginning after December 15, 2018. The Company is currently evaluating the impact of adopting this standard. |
Fair Value of Financial Instruments (Tables) |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Assets and Liabilities | The following table sets forth the Company’s financial assets and liabilities measured at fair value by level within the fair value hierarchy (in thousands):
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Balance Sheet Components (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Allowance for Doubtful Accounts | The Company’s allowance for doubtful accounts comprised of the following (in thousands):
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Schedule of Prepaid Expenses and Other Current Assets | The Company’s prepaid expenses and other current assets as of June 30, 2016 and December 31, 2015 were comprised of the following (in thousands):
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Schedule of Marketable Investments | The Company’s marketable investments as of June 30, 2016 and December 31, 2015 were as follows (in thousands):
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Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | The following tables present the gross unrealized losses and the fair value for those marketable investments that were in an unrealized loss position for less than twelve months as of June 30, 2016 and December 31, 2015 (in thousands):
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Schedule of Contractual Maturities of Marketable Investments | The contractual maturities of the Company’s marketable investments as of June 30, 2016 and December 31, 2015 were as follows (in thousands):
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Schedule of Inventories | The components of inventories as of June 30, 2016 and December 31, 2015 consisted of the following (in thousands):
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Schedule of Property and Equipment, Net | Property and equipment, net as of June 30, 2016 and December 31, 2015 consisted of the following (in thousands):
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Schedule of Accrued Liabilities | The following table shows the components of accrued liabilities as of June 30, 2016 and December 31, 2015 (in thousands):
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Schedule of Estimated Product Warranty Accrual | The estimated product warranty accrual as of June 30, 2016 and December 31, 2015 was as follows (in thousands):
|
Stock-based Compensation (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Stock Option Activity | Activity of stock options under the Penumbra, Inc. 2005 Stock Plan, the Penumbra, Inc. 2011 Equity Incentive Plan and the Amended and Restated Penumbra, Inc. 2014 Equity Incentive Plan (collectively “the Plans”) during the six months ended June 30, 2016 is set forth below:
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Summary of Unvested Restricted Stock and Restricted Stock Unit Activity | The following table summarizes the activity of unvested restricted stock and restricted stock units under the Plans during the six months ended June 30, 2016 is set forth below:
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Schedule of Stock-based Compensation Expense | The following table sets forth the stock-based compensation expense included in the condensed consolidated statements of operations and comprehensive income (loss) for the three and six months ended June 30, 2016 and 2015 (in thousands):
|
Accumulated Other Comprehensive Income (Loss) (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table summarizes the changes in the accumulated balances during the three and six months ended June 30, 2016 and 2015, and includes information regarding the manner in which the reclassifications out of accumulated other comprehensive income (loss) into earnings affect the Company’s condensed consolidated statements of operations and comprehensive income (loss) (in thousands):
|
Net Income per Share of Common Stock attributable to Common Stockholders (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of the Numerator and Denominator used in the Calculation of the Basic and Diluted Earnings per Share | A reconciliation of the numerator and denominator used in the calculation of the basic and diluted net income per share attributable to common stockholders for the three and six months ended June 30, 2016 and 2015 is as follows (in thousands, except share and per share amounts):
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Schedule of Antidilutive Securities Excluded from Computation of Earnings per Share | The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted net income per share of common stock for the periods presented, because the effect of including them would have been anti-dilutive:
|
Geographic Areas and Product Sales (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue by Geographic Area | The Company’s revenue by geographic area, based on the destination to which the Company ships its products, for the three and six months ended June 30, 2016 and 2015 was as follows (in thousands):
|
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Revenue by Product Category | The following table sets forth revenue by product category (in thousands):
|
Organization and Description of Business (Details) |
6 Months Ended |
---|---|
Jun. 30, 2016
market
| |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of major markets | 2 |
Summary of Significant Accounting Policies - Additional Disclosures (Details) |
6 Months Ended |
---|---|
Jun. 30, 2016
segment
activity
| |
Accounting Policies [Abstract] | |
Number of business activities | activity | 1 |
Number of operating segments | segment | 1 |
Balance Sheet Components Cash and Cash Equivalents Narrative (Details) - United States $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2016
USD ($)
financial_instituion
|
Dec. 31, 2015
USD ($)
|
|
Concentration Risk [Line Items] | ||
Number of financial institutions holding cash in excess of federally insured limits | financial_instituion | 1 | |
Cash, uninsured amount | $ | $ 2.7 | $ 1.9 |
Balance Sheet Components - Accounts Receivable, Net (Details) - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended | |
---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Dec. 31, 2015 |
|
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Balance at Beginning of Period | $ 589 | $ 602 | $ 602 |
Charged to Costs and Expenses | 72 | $ (101) | (13) |
Deductions | 0 | 0 | |
Balance at End of Period | $ 661 | $ 589 |
Balance Sheet Components - Accounts Receivable Narrative (Details) - Customer Concentration Risk - customer |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Dec. 31, 2015 |
|
Accounts Receivable | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, number of customers that accounted for greater than a specified benchmark | 0 | 0 | 0 | ||
Concentration risk, percentage | 10.00% | 10.00% | |||
One Major Customer | Sales Revenue, Net | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, number of customers that accounted for greater than a specified benchmark | 1 | 1 | 1 | 1 | |
Concentration risk, percentage | 10.00% | 10.00% | 10.00% | 10.00% |
Balance Sheet Components - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Prepaid Tax | $ 6,892 | $ 2,736 |
Prepaid expenses | 4,753 | 4,706 |
Income tax receivable | 3,273 | 606 |
Other current assets | 2,488 | 1,304 |
Prepaid expenses and other current assets | $ 17,406 | $ 9,352 |
Balance Sheet Components - Contractual Maturities of Marketable Investments (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Due in one year | $ 105,284 | $ 62,983 |
Due in one to five years | 20,665 | 66,274 |
Total | $ 125,949 | $ 129,257 |
Balance Sheet Components - Inventories (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 10,560 | $ 9,176 |
Work in process | 3,175 | 2,746 |
Finished goods | 54,671 | 44,839 |
Inventories | $ 68,406 | $ 56,761 |
Balance Sheet Components - Accrued Liabilities (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Payroll and employee-related expenses | $ 15,401 | $ 13,653 |
Sales return reserve | 3,040 | 3,247 |
Preclinical and clinical trial cost | 1,769 | 1,330 |
Deferred revenue | 411 | 526 |
Product warranty | 735 | 713 |
Sales tax payable | 497 | 531 |
Income tax payable | 139 | 308 |
Other accrued liabilities | 6,127 | 5,273 |
Total accrued liabilities | $ 28,119 | $ 25,581 |
Balance Sheet Components - Product Warranty (Details) - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2016 |
Dec. 31, 2015 |
|
Product Warranty, Increase (Decrease) [Roll Forward] | ||
Balance at the beginning of the period | $ 713 | $ 314 |
Provision for product warranty | 345 | 752 |
Settlements of product warranty claims | (323) | (353) |
Balance at the end of the period | $ 735 | $ 713 |
Commitments and Contingencies - Lease and Purchase Commitments (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Commitments and Contingencies Disclosure [Abstract] | ||||
Rent expense | $ 1.3 | $ 0.8 | $ 2.4 | $ 1.4 |
Commitments and Contingencies - Royalty Obligations (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Dec. 31, 2015 |
|
Cost of Sales | |||||
Other Commitments [Line Items] | |||||
Royalty expense | $ 700,000 | $ 400,000 | $ 1,400,000 | $ 800,000 | |
Royalty Agreement, March 2005 | |||||
Other Commitments [Line Items] | |||||
Minimum annual royalty payments | $ 100,000 | $ 100,000 | $ 100,000 | ||
Royalty Agreement, April 2012 | |||||
Other Commitments [Line Items] | |||||
Royalty as a percent of sales | 5.00% | ||||
Royalty Agreement, November 2013, Less than $5 Million in Sales | |||||
Other Commitments [Line Items] | |||||
Royalty as a percent of sales | 3.00% | ||||
Royalty Agreement, November 2013, Greater than $5 Million in Sales | |||||
Other Commitments [Line Items] | |||||
Royalty as a percent of sales | 1.00% | ||||
Royalty threshold | $ 5,000,000 | ||||
Royalty Agreement, April 2015 | |||||
Other Commitments [Line Items] | |||||
Royalty as a percent of sales | 2.00% |
Commitments and Contingencies - Litigation (Details) $ in Millions |
6 Months Ended |
---|---|
Jun. 30, 2016
USD ($)
| |
Damages from Product | |
Loss Contingencies [Line Items] | |
Damages sought, value | $ 35 |
Stock-based Compensation - Stock Option Activity (Details) |
6 Months Ended |
---|---|
Jun. 30, 2016
$ / shares
shares
| |
Number of Shares | |
Beginning balance (in shares) | shares | 3,755,345 |
Options exercised (in shares) | shares | (253,555) |
Options cancelled (in shares) | shares | (11,983) |
Ending balance (in shares) | shares | 3,489,807 |
Weighted- Average Exercise Price | |
Beginning balance (in dollars per share) | $ / shares | $ 12.13 |
Options exercised (in dollars per share) | $ / shares | 5.80 |
Options cancelled (in dollars per share) | $ / shares | 19.13 |
Ending balance (in dollars per share) | $ / shares | $ 12.56 |
Stock-based Compensation - Restricted Stock and Restricted Stock Units Activity (Details) - Restricted stock and restricted stock units |
6 Months Ended |
---|---|
Jun. 30, 2016
$ / shares
shares
| |
Number of Shares | |
Unvested beginning balance (in shares) | shares | 849,571 |
Granted (in shares) | shares | 132,800 |
Vested (in shares) | shares | (128,675) |
Canceled/Forfeited (in shares) | shares | (5,000) |
Unvested and expected to vest ending balance (in shares) | shares | 848,696 |
Weighted Average Grant Date Fair Value | |
Unvested beginning balance (in dollars per share) | $ / shares | $ 15.12 |
Granted (in dollars per share) | $ / shares | 46.30 |
Vested (in dollars per share) | $ / shares | 14.38 |
Canceled/Forfeited (in dollars per share) | $ / shares | 7.75 |
Unvested and expected to vest ending balance (in dollars per share) | $ / shares | $ 20.16 |
Stock-based Compensation - Employee Stock Purchase Plan (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2016 |
|
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Shares purchased under employee stock purchase plan (in shares) | 148,354 | 148,354 |
Shares purchased under employee stock purchase plan (in shares) | $ 3.8 | $ 3.8 |
Income Taxes (Details) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Income Tax Disclosure [Abstract] | ||||
Effective tax rate | 148.30% | 36.10% | 44.50% | 364.10% |
Net Income per Share of Common Stock attributable to Common Stockholders - Antidilutive Securities (Details) - shares |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from the computation of earnings per share (in shares) | 15,210 | 3,241,163 | 38,935 | 3,241,163 |
Options and ESPP to purchase common stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from the computation of earnings per share (in shares) | 0 | 2,485,392 | 4,007 | 2,485,392 |
Restricted stock and restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from the computation of earnings per share (in shares) | 15,210 | 755,771 | 34,928 | 755,771 |
Geographic Areas and Product Sales - Revenue by Geographic Area (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 65,106 | $ 42,311 | $ 123,025 | $ 81,263 |
United States | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 43,692 | 27,619 | 83,104 | 53,970 |
Japan | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 6,570 | 4,152 | 12,730 | 8,610 |
Other International | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 14,844 | $ 10,540 | $ 27,191 | $ 18,683 |
Geographic Areas and Product Sales - Revenue by Product Category (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Revenue from External Customer [Line Items] | ||||
Revenue | $ 65,106 | $ 42,311 | $ 123,025 | $ 81,263 |
Neuro | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 45,362 | 34,400 | 86,646 | 66,054 |
Peripheral Vascular | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | $ 19,744 | $ 7,911 | $ 36,379 | $ 15,209 |
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