CASTLIGHT HEALTH, INC., 10-Q filed on 7/31/2019
Quarterly Report
v3.19.2
Document and Entity Information - shares
6 Months Ended
Jun. 30, 2019
Jul. 25, 2019
Document Information [Line Items]    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Jun. 30, 2019  
Document Fiscal Year Focus 2019  
Document Fiscal Period Focus Q2  
Entity Registrant Name CASTLIGHT HEALTH, INC.  
Entity Central Index Key 0001433714  
Current Fiscal Year End Date --12-31  
Entity Filer Category Accelerated Filer  
Entity Emerging Growth Company true  
Entity Ex Transition Period true  
Entity Small Business false  
Entity Current Reporting Status Yes  
Entity Shell Company false  
Class A    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   35,043,253
Class B    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   110,207,745
v3.19.2
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Thousands
Jun. 30, 2019
Dec. 31, 2018
Current assets:    
Cash and cash equivalents $ 50,052 $ 66,005
Marketable securities 13,874 11,327
Accounts receivable and other, net 32,611 26,816
Prepaid expenses and other current assets 5,450 3,680
Total current assets 101,987 107,828
Property and equipment, net 3,556 3,963
Restricted cash, non-current 1,325 1,325
Deferred commissions 17,956 20,142
Deferred professional service costs 9,093 10,133
Intangible assets, net 14,457 16,209
Goodwill 91,785 91,785
Operating lease right-of-use assets, net 14,691  
Other assets 2,223 2,129
Total assets 257,073 253,514
Current liabilities:    
Accounts payable 11,355 9,556
Accrued expenses and other current liabilities 11,170 15,454
Accrued compensation 5,169 5,975
Deferred revenue 20,698 20,193
Operating lease liabilities 5,911  
Total current liabilities 54,303 51,178
Deferred revenue, non-current 837 1,030
Debt, non-current 2,324 3,254
Operating lease liabilities, non-current 12,032  
Other liabilities, non-current 1,067 3,381
Total liabilities 70,563 58,843
Commitments and contingencies
Stockholders’ equity:    
Class A and Class B common stock 14 14
Additional paid-in capital 620,449 609,697
Accumulated other comprehensive income 7 0
Accumulated deficit (433,960) (415,040)
Total stockholders’ equity 186,510 194,671
Total liabilities and stockholders’ equity $ 257,073 $ 253,514
v3.19.2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
shares in Thousands, $ in Thousands
3 Months Ended 6 Months Ended
Jun. 30, 2019
Jun. 30, 2018
Jun. 30, 2019
Jun. 30, 2018
Revenue:        
Total revenue, net $ 35,910 $ 37,784 $ 71,400 $ 74,263
Cost of revenue:        
Total cost of revenue 14,163 15,730 28,273 30,673
Gross profit 21,747 22,054 43,127 43,590
Operating expenses:        
Sales and marketing [1] 8,889 13,306 18,104 27,218
Research and development [1] 14,487 16,425 30,212 31,796
General and administrative [1] 7,010 6,382 14,303 13,207
Total operating expenses 30,386 36,113 62,619 72,221
Operating loss (8,639) (14,059) (19,492) (28,631)
Other income, net 258 101 572 229
Net loss $ (8,381) $ (13,958) $ (18,920) $ (28,402)
Net loss per share, basic and diluted (in usd per share) $ (0.06) $ (0.10) $ (0.13) $ (0.21)
Weighted-average shares used to compute basic and diluted net loss per share (in shares) 144,572 136,682 143,790 135,843
Subscription        
Revenue:        
Total revenue, net $ 33,964 $ 34,802 $ 67,770 $ 67,791
Cost of revenue:        
Total cost of revenue [1] 8,234 9,140 16,400 18,314
Professional services and other        
Revenue:        
Total revenue, net 1,946 2,982 3,630 6,472
Cost of revenue:        
Total cost of revenue [1] $ 5,929 $ 6,590 $ 11,873 $ 12,359
[1] Includes stock-based compensation expense as follows: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018Cost of revenue: Cost of subscription$196 $231 $415 $473Cost of professional services and other236 315 501 616Sales and marketing662 1,318 1,289 2,456Research and development1,733 1,908 3,437 3,562General and administrative2,030 1,375 3,192 2,632
v3.19.2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($)
$ in Thousands
3 Months Ended 6 Months Ended
Jun. 30, 2019
Jun. 30, 2018
Jun. 30, 2019
Jun. 30, 2018
Subscription        
Stock-based compensation expense $ 196 $ 231 $ 415 $ 473
Professional services and other        
Stock-based compensation expense 236 315 501 616
Sales and marketing        
Stock-based compensation expense 662 1,318 1,289 2,456
Research and development        
Stock-based compensation expense 1,733 1,908 3,437 3,562
General and administrative        
Stock-based compensation expense $ 2,030 $ 1,375 $ 3,192 $ 2,632
v3.19.2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($)
$ in Thousands
3 Months Ended 6 Months Ended
Jun. 30, 2019
Jun. 30, 2018
Jun. 30, 2019
Jun. 30, 2018
Statement of Comprehensive Income [Abstract]        
Net loss $ (8,381) $ (13,958) $ (18,920) $ (28,402)
Other comprehensive income:        
Net change in unrealized gain on available-for-sale marketable securities 7 11 7 13
Other comprehensive income 7 11 7 13
Comprehensive loss $ (8,374) $ (13,947) $ (18,913) $ (28,389)
v3.19.2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)
$ in Thousands
Total
Class A and B Common Stock
Additional Paid-In Capital
Accumulated Other Comprehensive Income (Loss)
Accumulated Deficit
Beginning balance (in shares) at Dec. 31, 2017   134,539,275      
Beginning balance at Dec. 31, 2017 $ 211,557 $ 13 $ 586,900 $ (22) $ (375,334)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Vesting of restricted stock units (in shares)   1,662,426      
Exercise of stock options, net (in shares)   1,527,309      
Exercise of stock options, net 2,243 $ 1 2,242    
Stock-based compensation 9,821   9,821    
Comprehensive loss (28,389)     13 (28,402)
Net loss (28,402)        
Ending balance (in shares) at Jun. 30, 2018   137,729,010      
Ending balance at Jun. 30, 2018 195,232 $ 14 598,963 (9) (403,736)
Beginning balance (in shares) at Mar. 31, 2018   135,595,828      
Beginning balance at Mar. 31, 2018 202,238 $ 13 592,023 (20) (389,778)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Vesting of restricted stock units (in shares)   915,115      
Exercise of stock options, net (in shares)   1,218,067      
Exercise of stock options, net 1,753 $ 1 1,752    
Stock-based compensation 5,188   5,188    
Comprehensive loss (13,947)     11 (13,958)
Net loss (13,958)        
Ending balance (in shares) at Jun. 30, 2018   137,729,010      
Ending balance at Jun. 30, 2018 195,232 $ 14 598,963 (9) (403,736)
Beginning balance (in shares) at Dec. 31, 2018   141,927,205      
Beginning balance at Dec. 31, 2018 $ 194,671 $ 14 609,697 0 (415,040)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Vesting of restricted stock units (in shares)   2,090,898      
Exercise of stock options, net (in shares) 1,180,784 1,180,784      
Exercise of stock options, net $ 1,845   1,845    
Stock-based compensation 8,907   8,907    
Comprehensive loss (18,913)     7  
Net loss (18,920)       (18,920)
Ending balance (in shares) at Jun. 30, 2019   145,198,887      
Ending balance at Jun. 30, 2019 186,510 $ 14 620,449 7 (433,960)
Beginning balance (in shares) at Mar. 31, 2019   143,955,787      
Beginning balance at Mar. 31, 2019 189,829 $ 14 615,394 0 (425,579)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Vesting of restricted stock units (in shares)   1,123,186      
Exercise of stock options, net (in shares)   119,914      
Exercise of stock options, net 165   165    
Stock-based compensation 4,890   4,890    
Comprehensive loss (8,374)     7  
Net loss (8,381)       (8,381)
Ending balance (in shares) at Jun. 30, 2019   145,198,887      
Ending balance at Jun. 30, 2019 $ 186,510 $ 14 $ 620,449 $ 7 $ (433,960)
v3.19.2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands
6 Months Ended
Jun. 30, 2019
Jun. 30, 2018
Operating activities:    
Net loss $ (18,920) $ (28,402)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 2,687 3,573
Stock-based compensation 8,834 9,739
Amortization and impairment of deferred commissions 4,856 5,800
Amortization and impairment of deferred professional service costs 2,014 2,097
Non-cash operating lease expense 2,580  
Lease exit and related charges 0 1,817
Accretion and amortization of marketable securities (213) (266)
Changes in operating assets and liabilities:    
Accounts receivable and other, net (5,795) (6,252)
Deferred commissions (2,670) (2,979)
Deferred professional service costs (901) (1,389)
Prepaid expenses and other assets (1,864) (1,896)
Accounts payable 1,864 511
Operating lease liabilities (2,795)  
Accrued expenses and other liabilities (3,131) 3,182
Deferred revenue 312 (1,210)
Accrued compensation (806) (4,411)
Net cash used in operating activities (13,948) (20,086)
Investing activities:    
Purchase of property and equipment (593) (1,304)
Purchase of marketable securities (13,780) (23,979)
Maturities of marketable securities 11,453 26,450
Net cash (used in) provided by investing activities (2,920) 1,167
Financing activities:    
Proceeds from exercise of stock options 1,845 2,242
Principal payments on long-term debt (930) 0
Net cash provided by financing activities 915 2,242
Net decrease in cash, cash equivalents and restricted cash (15,953) (16,677)
Cash, cash equivalents and restricted cash at beginning of period 67,330 62,644
Cash, cash equivalents and restricted cash at end of period 51,377 45,967
Reconciliation of cash, cash equivalents and restricted cash:    
Total cash, cash equivalents and restricted cash $ 67,330 $ 62,644
v3.19.2
Organization and Description of Business
6 Months Ended
Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Organization and Description of Business
Organization and Description of Business
Castlight Health, Inc. (“Castlight” or “the Company”) offers a comprehensive software-as-a-service platform that simplifies health benefits navigation for millions of employees. The Castlight platform matches employees to the best resources their employers make available to them, whether they are healthy, actively seeking medical care, or managing a condition, and motivates them to take the best steps for their health. Castlight helps employers generate more value from their benefits investments by helping to improve outcomes, lower health care costs, and increase benefits satisfaction. In July 2019, the Company announced plans to market its technology beyond its current employer market to health plans and other potential buyers who interact with healthcare users at the point of their care. The Company was incorporated in the State of Delaware in January 2008. The Company's principal executive offices are located in San Francisco, California.
v3.19.2
Accounting Standards and Significant Accounting Policies
6 Months Ended
Jun. 30, 2019
Accounting Policies [Abstract]  
Accounting Standards and Significant Accounting Policies
Accounting Standards and Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include Castlight and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. In the opinion of management, the information herein reflects all adjustments, consisting only of normal recurring adjustments except as otherwise noted, considered necessary for a fair statement of results of operations, financial position, stockholders’ equity and cash flows. The results for the interim periods presented are not necessarily indicative of the results expected for any future period. The following information should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018

Other than described below, there have been no changes to our significant accounting policies described in our Annual Report that have had a material impact on our consolidated financial statements and related notes.
Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. These estimates include, but are not limited to the determination of:

Variable consideration included in the transaction price of the Company’s contracts with customers;
The standalone selling price of the performance obligations in the Company’s contracts with customers;
Assumptions used in the valuation of certain equity awards;
The amortization period for deferred commissions and deferred professional services costs; and
Assumptions used in the calculation of right-of-use (“ROU”) assets and lease liabilities for operating leases, including lease terms and the Company’s incremental borrowing rate.

Actual results could differ from those estimates, and such differences could be material to the Company’s consolidated financial position and results of operations.

Summary of Significant Accounting Policies

Leases

The Company determines if an arrangement is a lease and its classification at lease inception. Operating lease liabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term. The Company uses its incremental borrowing rate based on the information available at the lease commencement date to compute the present value of lease payments when the implicit rate is not readily determinable. ROU assets are measured at lease inception based on the initial measurement of the lease liability, plus any prepaid lease amounts, less any lease incentives. The Company does not recognize ROU assets or lease liabilities for leases with a term of 12 months or less. Lease terms do not include options to extend or terminate the lease unless it is reasonably certain that the option will be exercised. Generally, lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company's lease agreements have both lease and non-lease components. The Company has elected to account for the non-lease components of its leases as part of their related lease components.

Concentrations of Risk and Significant Customers

No single direct customer accounted for more than 10% of total revenue during the three and six months ended June 30, 2019 or more than 10% of accounts receivable as of June 30, 2019. Castlight had one channel partner that represented approximately 26% and 25% of total revenue during the three and six months ended June 30, 2019, respectively, and approximately 37% of accounts receivable as of June 30, 2019.

Recently Adopted Accounting Pronouncements

Effective January 1, 2019, the Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases, and subsequent amendments ("ASC 842") using the modified retrospective method, and chose to apply the provisions at the beginning of the period of adoption. The guidance requires lessees to put all leases that have a term of more than one year on their balance sheets, whether operating or financing, while continuing to recognize the expenses on their income statements. The guidance states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-of-use ("ROU") asset for the right to use the underlying asset for the lease term. 

As a result of the adoption of ASC 842 as of January 1, 2019, reporting periods beginning on and after January 1, 2019 are presented under ASC 842, while prior period amounts were not adjusted and continue to be reported in accordance with prior accounting guidance under ASC 840. In addition, the Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Company to carry forward the historical lease classification. As a result of the adoption of the new lease accounting guidance, the Company recognized on January 1, 2019 an operating lease ROU asset of approximately $17.3 million and an operating lease liability of approximately $20.7 million. The difference between the operating lease ROU asset and lease liability resulted from the reclass of the deferred rent liability to the operating lease ROU asset. The standard did not materially impact the Company’s condensed consolidated statement of operations and had no impact on the cash flows. See Note 10 - Leases for more information on leases.

Recently Issued Accounting Pronouncements
    
The Company considers the applicability and impact of all ASUs issued by the FASB. The Company determined that the ASUs issued by the FASB during the six months ended June 30, 2019 are either not applicable or are expected to have minimal impact on the Company's condensed consolidated financial results.
v3.19.2
Revenue, Deferred Revenue, Contract Balances and Performance Obligations
6 Months Ended
Jun. 30, 2019
Revenue from Contract with Customer [Abstract]  
Revenue, Deferred Revenue, Contract Balances and Performance Obligations
Revenue, Deferred Revenue, Contract Balances and Performance Obligations
    
The Company sells to customers based in the United States through direct sales and indirect channels. Indirect channel revenue represented approximately 27% and 10% of the Company’s total revenue for the three months ended June 30, 2019 and 2018, respectively. Indirect channel revenue represented approximately 27% and 10% of the Company’s total revenue for the six months ended June 30, 2019 and 2018, respectively.

Deferred revenue as of June 30, 2019 and December 31, 2018 was $21.5 million and $21.2 million, respectively. Contract assets as of June 30, 2019 and December 31, 2018 were $1.2 million and $1.0 million, respectively.

$11.3 million and $16.5 million of revenue was recognized during the three months ended June 30, 2019 and 2018, respectively, that was included in the Company’s deferred revenue balances at the beginning of the respective periods. $16.0 million and $22.6 million of revenue was recognized during the six months ended June 30, 2019 and 2018, respectively, that was included in the Company’s deferred revenue balances at the beginning of the respective periods.

The Company recorded favorable cumulative catch-up adjustments to revenue of $0.5 million during the three months ended June 30, 2019 and unfavorable cumulative catch-up adjustments to revenue of $0.8 million during the three months ended June 30, 2018, arising from changes in estimates of transaction price. The Company recorded favorable cumulative catch-up adjustments to revenue of $1.9 million during the six months ended June 30, 2019 and unfavorable cumulative catch-up adjustments to revenue of $0.6 million during the six months ended June 30, 2018, arising from changes in estimates of transaction price.

The aggregate balance of remaining performance obligations from non-cancelable contracts with customers as of June 30, 2019 was $127.3 million. The Company expects to recognize approximately 70% of this balance over the next 12 months, with the remaining balance recognized thereafter. Remaining performance obligations are defined as deferred revenue and amounts yet to be billed for the non-cancelable portion of contracts.
v3.19.2
Deferred Costs
6 Months Ended
Jun. 30, 2019
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Deferred Costs
Deferred Costs

Changes in the balance of total deferred commissions and total deferred professional service costs during the six months ended June 30, 2019 are as follows (in thousands):
 
As of December 31, 2018
 
 
 
Expense recognized
 
As of June 30, 2019
 
 
Additions
 
Deferred commissions
$
20,142

 
$
2,670

 
$
(4,856
)
 
$
17,956

Deferred professional service costs
10,133

 
974

 
(2,014
)
 
9,093

Total deferred commissions and professional service costs
$
30,275

 
$
3,644

 
$
(6,870
)
 
$
27,049


    These costs are reviewed for impairment periodically, and impairment charges recorded for the three and six months ended June 30, 2019 and 2018 were not material.
v3.19.2
Goodwill and Intangible Assets
6 Months Ended
Jun. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets
Goodwill and Intangible Assets

Goodwill

Currently, all of the Company’s goodwill relates to the acquisition of Jiff. The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill. There were no changes to goodwill for the three and six months ended June 30, 2019.

Intangible assets, net
    
The following tables set forth the fair value components of identifiable acquired intangible assets (dollars in thousands):
 
June 30, 2019
 
Useful Life
 
Gross
 
Accumulated Amortization
 
Net
Customer relationships
10
 
$
10,900

 
$
(2,452
)
 
$
8,448

Developed technology
5
 
10,600

 
(4,770
)
 
5,830

Backlog
3
 
1,500

 
(1,371
)
 
129

Other acquired intangible assets
1
-
3
 
900

 
(850
)
 
50

Total identifiable intangible assets
 
 
 
 
$
23,900

 
$
(9,443
)
 
$
14,457



 
December 31, 2018

Useful Life
 
Gross

Accumulated Amortization

Net
Customer relationships
10
 
$
10,900


$
(1,908
)

$
8,992

Developed technology
5
 
10,600


(3,710
)

6,890

Backlog
3
 
1,500


(1,256
)

244

Other acquired intangible assets
1
-
3
 
900


(817
)

83

Total identifiable intangible assets



 
$
23,900


$
(7,691
)

$
16,209



Amortization expense from acquired intangible assets for the three months ended June 30, 2019 and 2018 was $0.9 million and $1.0 million, respectively. Amortization expense from acquired intangible assets for the six months ended June 30, 2019 and 2018 was $1.8 million and $2.1 million, respectively. Amortization expense is included in cost of subscription, sales and marketing, and general and administrative expenses.

Amortization expense for acquired intangible assets for the following five years and thereafter is as follows (in thousands):
Remainder of 2019
$
1,753

2020
3,242

2021
3,210

2022
1,620

2023
1,090

Thereafter
3,542

Total amortization expense
$
14,457

v3.19.2
Marketable Securities
6 Months Ended
Jun. 30, 2019
Investments, Debt and Equity Securities [Abstract]  
Marketable Securities
Marketable Securities

All of the Company’s cash equivalents and marketable securities are classified as “available-for-sale” securities. These securities are reported at fair value, with the related unrealized gains and losses included in accumulated other comprehensive income, a component of stockholders’ equity, except for money market mutual funds, where gains and losses are included in the results of operation.

As of June 30, 2019 and December 31, 2018, respectively, marketable securities consisted of the following (in thousands):
 
As of June 30, 2019
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair Value
U.S. treasury securities
$
3,999

 
$
4

 
$

 
$
4,003

U.S. agency obligations
14,808

 
3

 

 
14,811

Money market mutual funds
2,778

 

 

 
2,778

 
21,585

 
7

 

 
21,592

Included in cash and cash equivalents
7,718

 

 

 
7,718

Included in marketable securities
$
13,867

 
$
7

 
$

 
$
13,874


 
As of December 31, 2018
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair Value
U.S. treasury securities
$
7,980

 
$

 
$

 
$
7,980

U.S. agency obligations
18,158

 

 

 
18,158

Money market mutual funds
7,115

 

 

 
7,115

 
33,253

 

 

 
33,253

Included in cash and cash equivalents
21,926

 

 

 
21,926

Included in marketable securities
$
11,327

 
$

 
$

 
$
11,327

v3.19.2
Fair Value Measurements
6 Months Ended
Jun. 30, 2019
Fair Value Disclosures [Abstract]  
Fair Value Measurements
Fair Value Measurements
The Company measures its financial assets and liabilities at fair value at each reporting period using a fair value hierarchy that requires that the Company maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value:
Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2—Include other inputs that are directly or indirectly observable in the marketplace.
Level 3—Unobservable inputs that are supported by little or no market activity.
The fair value of marketable securities included in the Level 2 category is based on observable inputs, such as quoted prices for similar assets at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. These values were obtained from a third-party pricing service and were evaluated using pricing models that vary by asset class and may incorporate available trade, bid and other market information and price quotes from well-established third party pricing vendors and broker-dealers.
There have been no changes in valuation techniques in the periods presented. There were no significant transfers between fair value measurement levels as of June 30, 2019 and December 31, 2018. As of June 30, 2019 and December 31, 2018, there were no securities within Level 3 of the fair value hierarchy.
The following tables present information about the Company’s assets and liabilities that are measured at fair value on a recurring basis using the above input categories (in thousands):
 
As of June 30, 2019
 
Level 1
 
Level 2
 
Total
Cash equivalents:
 
 
 
 
 
U.S. agency obligations
$

 
$
4,940

 
$
4,940

Money market mutual funds
2,778

 

 
2,778

Marketable securities:
 
 
 
 
 
U.S. treasury securities

 
4,003

 
4,003

U.S. agency obligations

 
9,871

 
9,871

 
$
2,778

 
$
18,814

 
$
21,592

 
 
As of December 31, 2018
 
Level 1
 
Level 2
 
Total
Cash equivalents:
 
 
 
 
 
U.S. agency obligations
$

 
$
14,811

 
$
14,811

Money market mutual funds
7,115

 

 
7,115

Marketable securities:
 
 
 
 
 
U.S. treasury securities

 
7,980

 
7,980

U.S. agency obligations

 
3,347

 
3,347

 
$
7,115

 
$
26,138

 
$
33,253


Gross unrealized gains and losses for cash equivalents and marketable securities as of June 30, 2019 and December 31, 2018 were not material. The Company does not believe the unrealized losses represent other-than-temporary impairments based on the Company’s evaluation of available evidence as of June 30, 2019 and December 31, 2018.
There were no realized gains or losses during the three and six months ended June 30, 2019. All of the Company’s securities as of June 30, 2019 and December 31, 2018 mature within one year.
v3.19.2
Property and Equipment
6 Months Ended
Jun. 30, 2019
Property, Plant and Equipment [Abstract]  
Property and Equipment
Property and Equipment
Property and equipment consisted of the following (in thousands):
 
As of
 
June 30, 2019
 
December 31, 2018
Leasehold improvements
$
3,102

 
$
3,102

Computer equipment
7,185

 
6,860

Software
1,093

 
1,097

Internal-use software
2,925

 
2,925

Furniture and equipment
1,078

 
1,018

Total
15,383

 
15,002

Accumulated depreciation
(11,827
)
 
(11,039
)
Property and equipment, net
$
3,556

 
$
3,963


Depreciation and amortization expense for the three months ended June 30, 2019 and 2018 was $0.5 million and $0.8 million, respectively. Depreciation and amortization expense for the six months ended June 30, 2019 and 2018 was $0.9 million and $1.5 million, respectively. Depreciation and amortization are recorded on a straight-line basis.
v3.19.2
Debt
6 Months Ended
Jun. 30, 2019
Debt Disclosure [Abstract]  
Debt
Debt

Term Loan

In connection with the Company’s acquisition of Jiff, on April 3, 2017, the Company, Jiff and Silicon Valley Bank (the “Bank”) agreed to refinance the existing term loan facility owed by Jiff to the Bank (the “Loan Agreement”) for approximately $5.6 million (the “Term Loan”). The Term Loan requires interest-only payments for the period May 2017 through September 2018, followed by 36 monthly payments of principal and interest. Obligations under the Term Loan accrue interest at a floating per annum rate equal to the greater of (A) the prime rate as published in the money rates section of The Wall Street Journal (“Prime Rate”) minus 1% or (B) 0%. Interest on the Term Loan is payable monthly. The maturity date of the Term Loan is September 1, 2021.

In addition to principal and interest payments, the Company is also required to pay $0.5 million as final payment on the earlier of maturity, termination or prepayment of the Term Loan. The Company accrues for the final payment over the life of the Term Loan using the effective interest method.
    
The future maturities of the Term Loan by year as of June 30, 2019 are as follows (in thousands):
Remainder of 2019
$
929

2020
1,859

2021(1)
1,395

Total future maturities of debt
$
4,183

Less current maturities(2)
(1,859
)
Debt, non-current
$
2,324

(1) Excludes the $0.5 million required to be paid as final payment on the earlier of maturity, termination or prepayment of the Term Loan.
(2) Classified within accrued expenses and other current liabilities on the condensed consolidated balance sheet as of June 30, 2019.

Revolving Line of Credit    

The Loan Agreement also provided for an up to $25 million revolving credit facility, which expired on April 3, 2019, its termination date.

In relation to the Loan Agreement, the Company is subject to certain financial and reporting covenants. As of June 30, 2019, none of the financial covenants, which require the Company to maintain a certain minimum liquidity ratio, are applicable. The Company was in compliance with all reporting covenants in the Loan Agreement related to the outstanding principal balance as of June 30, 2019.
v3.19.2
Leases
6 Months Ended
Jun. 30, 2019
Leases [Abstract]  
Leases
Leases
    
The Company’s principal commitments primarily consist of obligations under leases for office space and co-location facilities for data center capacity. The leases expire at various dates through 2025 and, in some cases, include renewal options. The exercise of the option is at the sole discretion of the Company. The Company subleases certain office facilities to third parties. These leases are classified as operating leases. The Company does not have finance leases. Information about these operating leases is disclosed in the following table (dollars in thousands):
 
Three Months Ended June 30, 2019
 
Six Months Ended June 30, 2019
Lease cost:
 
 
 
Operating lease cost
$
1,639

 
$
3,288

Variable lease cost (1)
229

 
380

Short-term lease cost
7

 
7

Sublease income
(577
)
 
(1,193
)
Total lease cost
$
1,298

 
$
2,482

 
 
 
 
Other information:
 
 
 
Operating cash flows used in the measurement of operating lease liabilities
 
 
$
3,503

Weighted-average remaining lease term - operating leases (in years)
 
 
3.3

Weighted-average discount rate - operating leases
 
 
7.46
%
(1) Includes variable payments such as common area maintenance, property taxes and insurance.

Maturities of Lease Liabilities

As of June 30, 2019, the future minimum lease payments under non-cancellable operating leases are as follows (in thousands):
Remainder of 2019
$
3,582

2020
6,524

2021
5,355

2022
3,050

2023
677

2024 and later
1,111

Total lease payments
20,299

Less: Interest
(2,356
)
Present value of lease liabilities
$
17,943

Less: current portion
(5,911
)
Operating lease liabilities, non-current
$
12,032

v3.19.2
Contingencies
6 Months Ended
Jun. 30, 2019
Commitments and Contingencies Disclosure [Abstract]  
Contingencies
Contingencies
Legal Matters

From time to time, the Company may become subject to other legal proceedings, claims or litigation arising in the ordinary course of business. In addition, the Company may receive letters alleging infringement of patents or other intellectual property rights. If an unfavorable outcome were to occur in litigation, the impact could be material to the Company’s business, financial condition, cash flow or results of operations, depending on the specific circumstances of the outcome. The Company accrues for loss contingencies when it is both probable that it will incur the loss and when it can reasonably estimate the amount of the loss or range of loss.
v3.19.2
Stock Compensation
6 Months Ended
Jun. 30, 2019
Share-based Payment Arrangement [Abstract]  
Stock Compensation
Stock Compensation
Restricted Stock Units (“RSUs”)

A summary of unvested restricted stock unit activity for the six months ended June 30, 2019 is as follows:
 
Number of
Shares
 
Weighted-
Average
Grant Date Fair Value
Balance as of December 31, 2018
9,528,602

 
$
3.54

Granted
4,602,787

 
$
3.61

Vested
(2,090,898
)
 
$
3.82

Forfeited and canceled (1)
(1,113,569
)
 
$
3.48

Balance as of June 30, 2019
10,926,922

 
$
3.49

(1) Includes performance stock units that were granted in the prior year, which were canceled because performance targets were not achieved.
As of June 30, 2019, there was a total of $35.0 million in unrecognized compensation cost related to restricted stock units, which is expected to be recognized over a weighted-average period of approximately 2.8 years.

The Company granted 519,000 market-based RSUs during the three and six months ended June 30, 2019No market-based RSUs were granted in prior periods. The market-based RSUs vest based on the Company achieving certain stock price thresholds, subject to the employee’s continued employment with the Company through the date of achievement. The fair value is based on values calculated under the Monte Carlo simulation model on the grant date, which will be recognized over the derived service period. Compensation cost is not adjusted in future periods for subsequent changes in the expected outcome of market related conditions. For the three and six months ended June 30, 2019, the Company recognized $0.4 million of stock compensation expense in connection with this award.
Stock Options
A summary of stock option activity for the six months ended June 30, 2019 is as follows: 
 
Options
Outstanding
 
Weighted-
Average
Exercise
Price
 
Aggregate
Intrinsic
Value (in thousands)
Balance as of December 31, 2018
6,265,223

 
$
2.65

 
$
3,499

Granted
200,000

 
$
3.22

 
 
Exercised
(1,180,784
)
 
$
1.56

 
 
Forfeited and canceled
(54,406
)
 
$
2.55

 
 
Balance as of June 30, 2019
5,230,033

 
$
2.92

 
$
6,182


The total grant-date fair value of stock options granted during the six months ended June 30, 2019 and 2018 was $0.4 million and $0.3 million, respectively.
The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-valuation model with the following assumptions and fair value per share:
 
Six Months Ended June 30, 2019
 
2019
 
2018
Volatility
57%
 
57%
Expected life (in years)
6.06
 
6.06
Risk-free interest rate
2.57%
 
2.72
%
-
2.74%
Dividend yield
—%
 
—%

As of June 30, 2019, the Company had $1.0 million in unrecognized compensation cost related to non-vested stock options, which is expected to be recognized over a weighted-average period of approximately 2.3 years.
v3.19.2
Stockholders' Equity
6 Months Ended
Jun. 30, 2019
Equity [Abstract]  
Stockholders’ Equity
Stockholders’ Equity
Common Stock
As of June 30, 2019, the Company had 35,043,253 shares of Class A common stock and 110,155,634 shares of Class B common stock outstanding.
v3.19.2
Income Taxes
6 Months Ended
Jun. 30, 2019
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
    
The effective tax rate for each of the three and six months ended June 30, 2019 and 2018 was zero percent, primarily as a result of the estimated tax loss for the year and the change in valuation allowance. At June 30, 2019, all unrecognized tax benefits are subject to a full valuation allowance and, if recognized, will not affect the effective tax rate.
v3.19.2
Net Loss per Share
6 Months Ended
Jun. 30, 2019
Earnings Per Share [Abstract]  
Net Loss per Share
Net Loss per Share
Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including outstanding stock options and warrants, to the extent dilutive. Basic and diluted net loss per share was the same for each period presented as the inclusion of all potential shares of common stock outstanding would have been anti-dilutive.
Net loss is allocated based on the contractual participation rights of the Class A and Class B common stock as if the earnings for the year have been distributed. As the liquidation and dividend rights are identical, the net loss is allocated on a proportionate basis.
    
The following table presents the calculation of basic and diluted net loss per share for the Company’s common stock (in thousands, except per share data):
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
 
2018
 
2019
 
2018
 
Class A
 
Class B
 
Class A
 
Class B
 
Class A
 
Class B
 
Class A
 
Class B
Net loss
$
(2,026
)
 
$
(6,355
)
 
$
(5,315
)
 
$
(8,643
)
 
$
(4,767
)
 
$
(14,153
)
 
$
(10,956
)
 
$
(17,446
)
Weighted-average shares used to compute basic and diluted net loss per share
35,276

 
109,296

 
52,043

 
84,639

 
36,227

 
107,563

 
52,401

 
83,442

Basic and diluted net loss per share
$
(0.06
)
 
$
(0.06
)
 
$
(0.10
)
 
$
(0.10
)
 
$
(0.13
)
 
$
(0.13
)
 
$
(0.21
)
 
$
(0.21
)

The following securities were excluded from the calculation of diluted net loss per share for common stock because their effect would have been anti-dilutive for the periods presented (in thousands):
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
 
2018
 
2019
 
2018
Stock options and restricted stock units
16,157

 
19,092

 
16,157

 
19,092

Warrants
115

 
115

 
115

 
115

Total
16,272

 
19,207

 
16,272

 
19,207

v3.19.2
Accounting Standards and Significant Accounting Policies (Policies)
6 Months Ended
Jun. 30, 2019
Accounting Policies [Abstract]  
Basis of Presentation and Principles of Consolidation
Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include Castlight and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. In the opinion of management, the information herein reflects all adjustments, consisting only of normal recurring adjustments except as otherwise noted, considered necessary for a fair statement of results of operations, financial position, stockholders’ equity and cash flows. The results for the interim periods presented are not necessarily indicative of the results expected for any future period. The following information should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018

Other than described below, there have been no changes to our significant accounting policies described in our Annual Report that have had a material impact on our consolidated financial statements and related notes.
Use of Estimates
Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. These estimates include, but are not limited to the determination of:

Variable consideration included in the transaction price of the Company’s contracts with customers;
The standalone selling price of the performance obligations in the Company’s contracts with customers;
Assumptions used in the valuation of certain equity awards;
The amortization period for deferred commissions and deferred professional services costs; and
Assumptions used in the calculation of right-of-use (“ROU”) assets and lease liabilities for operating leases, including lease terms and the Company’s incremental borrowing rate.

Actual results could differ from those estimates, and such differences could be material to the Company’s consolidated financial position and results of operations.

Leases
Leases

The Company determines if an arrangement is a lease and its classification at lease inception. Operating lease liabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term. The Company uses its incremental borrowing rate based on the information available at the lease commencement date to compute the present value of lease payments when the implicit rate is not readily determinable. ROU assets are measured at lease inception based on the initial measurement of the lease liability, plus any prepaid lease amounts, less any lease incentives. The Company does not recognize ROU assets or lease liabilities for leases with a term of 12 months or less. Lease terms do not include options to extend or terminate the lease unless it is reasonably certain that the option will be exercised. Generally, lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company's lease agreements have both lease and non-lease components. The Company has elected to account for the non-lease components of its leases as part of their related lease components.
Recently Adopted Accounting Pronouncements and Recently Issued Accounting Pronouncements
Recently Adopted Accounting Pronouncements

Effective January 1, 2019, the Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases, and subsequent amendments ("ASC 842") using the modified retrospective method, and chose to apply the provisions at the beginning of the period of adoption. The guidance requires lessees to put all leases that have a term of more than one year on their balance sheets, whether operating or financing, while continuing to recognize the expenses on their income statements. The guidance states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-of-use ("ROU") asset for the right to use the underlying asset for the lease term. 

As a result of the adoption of ASC 842 as of January 1, 2019, reporting periods beginning on and after January 1, 2019 are presented under ASC 842, while prior period amounts were not adjusted and continue to be reported in accordance with prior accounting guidance under ASC 840. In addition, the Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Company to carry forward the historical lease classification. As a result of the adoption of the new lease accounting guidance, the Company recognized on January 1, 2019 an operating lease ROU asset of approximately $17.3 million and an operating lease liability of approximately $20.7 million. The difference between the operating lease ROU asset and lease liability resulted from the reclass of the deferred rent liability to the operating lease ROU asset. The standard did not materially impact the Company’s condensed consolidated statement of operations and had no impact on the cash flows. See Note 10 - Leases for more information on leases.

Recently Issued Accounting Pronouncements
    
The Company considers the applicability and impact of all ASUs issued by the FASB. The Company determined that the ASUs issued by the FASB during the six months ended June 30, 2019 are either not applicable or are expected to have minimal impact on the Company's condensed consolidated financial results.
v3.19.2
Deferred Costs (Tables)
6 Months Ended
Jun. 30, 2019
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Changes in Balance of Total Deferred Commissions and Total Deferred Professional Service Costs
Changes in the balance of total deferred commissions and total deferred professional service costs during the six months ended June 30, 2019 are as follows (in thousands):
 
As of December 31, 2018
 
 
 
Expense recognized
 
As of June 30, 2019
 
 
Additions
 
Deferred commissions
$
20,142

 
$
2,670

 
$
(4,856
)
 
$
17,956

Deferred professional service costs
10,133

 
974

 
(2,014
)
 
9,093

Total deferred commissions and professional service costs
$
30,275

 
$
3,644

 
$
(6,870
)
 
$
27,049


v3.19.2
Goodwill and Intangible Assets (Tables)
6 Months Ended
Jun. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Finite-Lived Intangible Assets
The following tables set forth the fair value components of identifiable acquired intangible assets (dollars in thousands):
 
June 30, 2019
 
Useful Life
 
Gross
 
Accumulated Amortization
 
Net
Customer relationships
10
 
$
10,900

 
$
(2,452
)
 
$
8,448

Developed technology
5
 
10,600

 
(4,770
)
 
5,830

Backlog
3
 
1,500

 
(1,371
)
 
129

Other acquired intangible assets
1
-
3
 
900

 
(850
)
 
50

Total identifiable intangible assets
 
 
 
 
$
23,900

 
$
(9,443
)
 
$
14,457



 
December 31, 2018

Useful Life
 
Gross

Accumulated Amortization

Net
Customer relationships
10
 
$
10,900


$
(1,908
)

$
8,992

Developed technology
5
 
10,600


(3,710
)

6,890

Backlog
3
 
1,500


(1,256
)

244

Other acquired intangible assets
1
-
3
 
900


(817
)

83

Total identifiable intangible assets



 
$
23,900


$
(7,691
)

$
16,209

Schedule of Amortization Expense for Acquired Intangible Assets
Amortization expense for acquired intangible assets for the following five years and thereafter is as follows (in thousands):
Remainder of 2019
$
1,753

2020
3,242

2021
3,210

2022
1,620

2023
1,090

Thereafter
3,542

Total amortization expense
$
14,457

v3.19.2
Marketable Securities (Tables)
6 Months Ended
Jun. 30, 2019
Investments, Debt and Equity Securities [Abstract]  
Available-for-sale Securities
As of June 30, 2019 and December 31, 2018, respectively, marketable securities consisted of the following (in thousands):
 
As of June 30, 2019
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair Value
U.S. treasury securities
$
3,999

 
$
4

 
$

 
$
4,003

U.S. agency obligations
14,808

 
3

 

 
14,811

Money market mutual funds
2,778

 

 

 
2,778

 
21,585

 
7

 

 
21,592

Included in cash and cash equivalents
7,718

 

 

 
7,718

Included in marketable securities
$
13,867

 
$
7

 
$

 
$
13,874


 
As of December 31, 2018
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair Value
U.S. treasury securities
$
7,980

 
$

 
$

 
$
7,980

U.S. agency obligations
18,158

 

 

 
18,158

Money market mutual funds
7,115

 

 

 
7,115

 
33,253

 

 

 
33,253

Included in cash and cash equivalents
21,926

 

 

 
21,926

Included in marketable securities
$
11,327

 
$

 
$

 
$
11,327

v3.19.2
Fair Value Measurements (Tables)
6 Months Ended
Jun. 30, 2019
Fair Value Disclosures [Abstract]  
Fair Value, Assets Measured on Recurring Basis
The following tables present information about the Company’s assets and liabilities that are measured at fair value on a recurring basis using the above input categories (in thousands):
 
As of June 30, 2019
 
Level 1
 
Level 2
 
Total
Cash equivalents:
 
 
 
 
 
U.S. agency obligations
$

 
$
4,940

 
$
4,940

Money market mutual funds
2,778

 

 
2,778

Marketable securities:
 
 
 
 
 
U.S. treasury securities

 
4,003

 
4,003

U.S. agency obligations

 
9,871

 
9,871

 
$
2,778

 
$
18,814

 
$
21,592

 
 
As of December 31, 2018
 
Level 1
 
Level 2
 
Total
Cash equivalents:
 
 
 
 
 
U.S. agency obligations
$

 
$
14,811

 
$
14,811

Money market mutual funds
7,115

 

 
7,115

Marketable securities:
 
 
 
 
 
U.S. treasury securities

 
7,980

 
7,980

U.S. agency obligations

 
3,347

 
3,347

 
$
7,115

 
$
26,138

 
$
33,253

v3.19.2
Property and Equipment (Tables)
6 Months Ended
Jun. 30, 2019
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment
Property and equipment consisted of the following (in thousands):
 
As of
 
June 30, 2019
 
December 31, 2018
Leasehold improvements
$
3,102

 
$
3,102

Computer equipment
7,185

 
6,860

Software
1,093

 
1,097

Internal-use software
2,925

 
2,925

Furniture and equipment
1,078

 
1,018

Total
15,383

 
15,002

Accumulated depreciation
(11,827
)
 
(11,039
)
Property and equipment, net
$
3,556

 
$
3,963

v3.19.2
Debt (Tables)
6 Months Ended
Jun. 30, 2019
Debt Disclosure [Abstract]  
Schedule of Maturities of Long-term Debt
The future maturities of the Term Loan by year as of June 30, 2019 are as follows (in thousands):
Remainder of 2019
$
929

2020
1,859

2021(1)
1,395

Total future maturities of debt
$
4,183

Less current maturities(2)
(1,859
)
Debt, non-current
$
2,324

(1) Excludes the $0.5 million required to be paid as final payment on the earlier of maturity, termination or prepayment of the Term Loan.
(2) Classified within accrued expenses and other current liabilities on the condensed consolidated balance sheet as of June 30, 2019.
v3.19.2
Leases (Tables)
6 Months Ended
Jun. 30, 2019
Leases [Abstract]  
Information About Operating Leases
Information about these operating leases is disclosed in the following table (dollars in thousands):
 
Three Months Ended June 30, 2019
 
Six Months Ended June 30, 2019
Lease cost:
 
 
 
Operating lease cost
$
1,639

 
$
3,288

Variable lease cost (1)
229

 
380

Short-term lease cost
7

 
7

Sublease income
(577
)
 
(1,193
)
Total lease cost
$
1,298

 
$
2,482

 
 
 
 
Other information:
 
 
 
Operating cash flows used in the measurement of operating lease liabilities
 
 
$
3,503

Weighted-average remaining lease term - operating leases (in years)
 
 
3.3

Weighted-average discount rate - operating leases
 
 
7.46
%
(1) Includes variable payments such as common area maintenance, property taxes and insurance.
Maturities of Lease Liabilities
As of June 30, 2019, the future minimum lease payments under non-cancellable operating leases are as follows (in thousands):
Remainder of 2019
$
3,582

2020
6,524

2021
5,355

2022
3,050

2023
677

2024 and later
1,111

Total lease payments
20,299

Less: Interest
(2,356
)
Present value of lease liabilities
$
17,943

Less: current portion
(5,911
)
Operating lease liabilities, non-current
$
12,032

v3.19.2
Stock Compensation (Tables)
6 Months Ended
Jun. 30, 2019
Share-based Payment Arrangement [Abstract]  
Schedule of Other Share-based Compensation, Activity
A summary of unvested restricted stock unit activity for the six months ended June 30, 2019 is as follows:
 
Number of
Shares
 
Weighted-
Average
Grant Date Fair Value
Balance as of December 31, 2018
9,528,602

 
$
3.54

Granted
4,602,787

 
$
3.61

Vested
(2,090,898
)
 
$
3.82

Forfeited and canceled (1)
(1,113,569
)
 
$
3.48

Balance as of June 30, 2019
10,926,922

 
$
3.49

(1) Includes performance stock units that were granted in the prior year, which were canceled because performance targets were not achieved.
Schedule of Share-based Compensation, Stock Options, Activity
A summary of stock option activity for the six months ended June 30, 2019 is as follows: 
 
Options
Outstanding
 
Weighted-
Average
Exercise
Price
 
Aggregate
Intrinsic
Value (in thousands)
Balance as of December 31, 2018
6,265,223

 
$
2.65

 
$
3,499

Granted
200,000

 
$
3.22

 
 
Exercised
(1,180,784
)
 
$
1.56

 
 
Forfeited and canceled
(54,406
)