|
|
|
|
|
|
|
|
|
|
Tooling and manufacturing equipment | One to three years | |
Furniture and office equipment | Three years | |
Purchased software | Three years | |
Capitalized internally-developed software | Two to eight years | |
Leasehold improvements | Shorter of remaining lease term or ten years |
• | Retailers and distributors are generally allowed to return products that were originally sold through to an end-user under provisions of their contracts, called “open-box” returns, and such returns may be made at any time after the original sale. |
• | All purchases through Fitbit.com are covered by a 45-day right of return. |
• | Certain distributors are allowed stock rotation rights which are limited rights of return of products purchased during a prior period, generally one quarter. |
• | Certain distributors and retailers are allowed return rights for defective products. |
• | Certain distributors are offered price protection that allows for the right to a partial credit for unsold inventory held by the distributor if the Company reduces the selling price of a product. |
• | refunds and product returns from retailer and distributor customers and end-users, which were charged to revenue and cost of revenue on the consolidated statements of operations; |
• | logistics and handling fees for managing product returns and processing refunds, obsolescence of on-hand inventory, cancellation charges for existing purchase commitments and rework of component inventory by the Company’s contract manufacturers, accelerated depreciation of tooling and manufacturing equipment, which were charged to cost of revenue on the consolidated statements of operations; and |
• | legal fees and settlement costs, which were charged to general and administrative expenses on the consolidated statements of operations. |
|
December 31, 2017 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | |||||||||||||||
Money market funds | $ | 193,066 | $ | — | $ | — | $ | 193,066 | |||||||
U.S. government agencies | — | 79,624 | — | 79,624 | |||||||||||
Corporate debt securities | — | 291,582 | — | 291,582 | |||||||||||
Total | $ | 193,066 | $ | 371,206 | $ | — | $ | 564,272 | |||||||
Liabilities: | |||||||||||||||
Derivative liabilities | $ | — | $ | 2,138 | $ | — | $ | 2,138 | |||||||
Stock warrant liability | — | — | 208 | 208 | |||||||||||
$ | — | $ | 2,138 | $ | 208 | $ | 2,346 |
December 31, 2016 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | |||||||||||||||
Money market funds | $ | 50,125 | $ | — | $ | — | $ | 50,125 | |||||||
U.S. government agencies | — | 86,526 | — | 86,526 | |||||||||||
Corporate debt securities | — | 390,286 | — | 390,286 | |||||||||||
Derivative assets | — | 10,625 | — | 10,625 | |||||||||||
Total | $ | 50,125 | $ | 487,437 | $ | — | $ | 537,562 | |||||||
Liabilities: | |||||||||||||||
Derivative liabilities | $ | — | $ | 3,780 | $ | — | $ | 3,780 |
|
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Cash and Cash Equivalents | Marketable Securities | ||||||||||||||||||
Cash | $ | 115,028 | $ | — | $ | — | $ | 115,028 | $ | 115,028 | $ | — | |||||||||||
Money market funds | 193,066 | — | — | 193,066 | 193,066 | — | |||||||||||||||||
U.S. government agencies | 79,722 | 1 | (99 | ) | 79,624 | 6,595 | 73,029 | ||||||||||||||||
Corporate debt securities | 291,738 | 15 | (171 | ) | 291,582 | 27,277 | 264,305 | ||||||||||||||||
Total | $ | 679,554 | $ | 16 | $ | (270 | ) | $ | 679,300 | $ | 341,966 | $ | 337,334 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Cash and Cash Equivalents | Marketable Securities | ||||||||||||||||||
Cash | $ | 179,076 | $ | — | $ | — | $ | 179,076 | $ | 179,076 | $ | — | |||||||||||
Money market funds | 50,125 | — | — | 50,125 | 50,125 | — | |||||||||||||||||
U.S. government agencies | 86,533 | 8 | (15 | ) | 86,526 | — | 86,526 | ||||||||||||||||
Corporate debt securities | 390,466 | 24 | (204 | ) | 390,286 | 72,119 | 318,167 | ||||||||||||||||
Total | $ | 706,200 | $ | 32 | $ | (219 | ) | $ | 706,013 | $ | 301,320 | $ | 404,693 |
December 31, 2017 | December 31, 2016 | ||||||
Due in one year | $ | 319,112 | $ | 355,152 | |||
Due in one to two years | 18,222 | 49,541 | |||||
Total | $ | 337,334 | $ | 404,693 |
December 31, 2017 | December 31, 2016 | ||||||||||||||||
Balance Sheet Location | Fair Value Derivative Assets | Fair Value Derivative Liabilities | Fair Value Derivative Assets | Fair Value Derivative Liabilities | |||||||||||||
Cash flow designated hedges | Prepaid expense and other current assets | $ | — | $ | — | $ | 813 | $ | — | ||||||||
Cash flow designated hedges | Accrued liabilities | — | — | — | 1,428 | ||||||||||||
Hedges not designated | Prepaid expense and other current assets | — | — | 9,812 | — | ||||||||||||
Hedges not designated | Accrued liabilities | — | 2,138 | — | 2,352 | ||||||||||||
Total fair value of derivative instruments | $ | — | $ | 2,138 | $ | 10,625 | $ | 3,780 |
Year Ended December 31, | |||||||||||||
Income Statement Location | 2017 | 2016 | 2015 | ||||||||||
Foreign exchange cash flow hedges: | |||||||||||||
Gain (loss) recognized in OCI—effective portion | $ | (19,436 | ) | $ | 8,171 | $ | 2,785 | ||||||
Gain (loss) reclassified from OCI into income—effective portion | Revenue | (18,532 | ) | 10,153 | 2,183 | ||||||||
Gain (loss) reclassified from OCI into income—effective portion | Operating expenses | (1,405 | ) | 17 | (899 | ) | |||||||
Gain (loss) recognized in income—ineffective portion | Other income (expense), net | 21 | (1,026 | ) | 202 | ||||||||
Gain (loss) recognized in income—excluded time value portion | Other income (expense), net | 1,771 | — | — | |||||||||
Foreign exchange balance sheet hedges: | |||||||||||||
Gain (loss) recognized in income | Other income (expense), net | $ | (10,516 | ) | $ | 10,916 | $ | 5,861 |
December 31, 2017 | |||||||||||||||||||||||
Gross Amounts Offset in the Consolidated Balance Sheets | Gross Amounts Not Offset in Consolidated Balance Sheets | ||||||||||||||||||||||
Gross Amount Recognized | Gross Amount Offset | Net Amount Presented | Financial Instruments | Cash Collateral Received | Net Amount | ||||||||||||||||||
Foreign exchange contracts assets | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
Foreign exchange contracts liabilities | 2,138 | — | 2,138 | — | — | 2,138 |
December 31, 2016 | |||||||||||||||||||||||
Gross Amounts Offset in the Consolidated Balance Sheets | Gross Amounts Not Offset in Consolidated Balance Sheets | ||||||||||||||||||||||
Gross Amounts Recognized | Gross Amounts Offset | Net Amount Presented | Financial Instruments | Cash Collateral Received | Net Amount | ||||||||||||||||||
Foreign exchange contracts assets | $ | 10,625 | $ | — | $ | 10,625 | $ | 3,780 | $ | — | $ | 6,845 | |||||||||||
Foreign exchange contracts liabilities | 3,780 | — | 3,780 | 3,780 | — | — |
|
Allowance for Doubtful Accounts | Revenue Returns Reserve(1) | ||||||
Balance at December 31, 2014 | 838 | 26,559 | |||||
Increases | 1,115 | 169,677 | |||||
Write-offs/returns taken | (128 | ) | (122,191 | ) | |||
Balance at December 31, 2015 | 1,825 | 74,045 | |||||
Increases | 339 | 275,815 | |||||
Write-offs/returns taken | (1,882 | ) | (251,009 | ) | |||
Balance at December 31, 2016 | 282 | 98,851 | |||||
Increases(2) | 30,551 | 229,610 | |||||
Write-offs/returns taken(2) | (21,604 | ) | (218,589 | ) | |||
Balance at December 31, 2017 | $ | 9,229 | $ | 109,872 |
December 31, | |||||||
2017 | 2016 | ||||||
Components | $ | 3,825 | $ | 1,035 | |||
Finished goods | 120,070 | 229,352 | |||||
Total inventories | $ | 123,895 | $ | 230,387 |
December 31, | |||||||
2017 | 2016 | ||||||
POP displays, net | $ | 14,750 | $ | 22,804 | |||
Prepaid expenses | 24,204 | 17,161 | |||||
Derivative assets | — | 10,625 | |||||
Prepaid marketing | 6,074 | 5,764 | |||||
Insurance receivable | 37,300 | — | |||||
Other | 14,941 | 9,511 | |||||
Total prepaid expenses and other current assets | $ | 97,269 | $ | 65,865 |
December 31, | |||||||
2017 | 2016 | ||||||
Tooling and manufacturing equipment | $ | 66,854 | $ | 60,944 | |||
Furniture and office equipment | 20,942 | 14,424 | |||||
Purchased and internally-developed software | 18,112 | 12,032 | |||||
Leasehold improvements | 58,431 | 28,489 | |||||
Total property and equipment | 164,339 | 115,889 | |||||
Less: Accumulated depreciation and amortization | (59,431 | ) | (39,336 | ) | |||
Property and equipment, net | $ | 104,908 | $ | 76,553 |
Goodwill | |||
Balance at December 31, 2015 | $ | 22,157 | |
Goodwill acquired | 28,879 | ||
Balance at December 31, 2016 | $ | 51,036 | |
Goodwill acquired | — | ||
Balance at December 31, 2017 | $ | 51,036 |
December 31, 2017 | December 31, 2016 | Weighted Average Remaining Useful Life (years) | |||||||||||||||||||||||
Gross | Accumulated Amortization | Net | Gross | Accumulated Amortization | Net | ||||||||||||||||||||
Developed technology | $ | 30,588 | $ | (8,738 | ) | $ | 21,850 | $ | 26,092 | $ | (3,247 | ) | $ | 22,845 | 4.0 | ||||||||||
Trademarks and other | 1,278 | (772 | ) | 506 | 1,278 | (542 | ) | 736 | 0.9 | ||||||||||||||||
Total finite-lived intangible assets subject to amortization, net | 31,866 | (9,510 | ) | 22,356 | 27,370 | (3,789 | ) | 23,581 | |||||||||||||||||
In-process research and development | — | — | — | 3,940 | — | 3,940 | |||||||||||||||||||
Total intangible assets, net | $ | 31,866 | $ | (9,510 | ) | $ | 22,356 | $ | 31,310 | $ | (3,789 | ) | $ | 27,521 |
Cost of Revenue | Operating Expenses | Total | |||||||||
2018 | $ | 6,120 | $ | 230 | $ | 6,350 | |||||
2019 | 5,340 | 230 | 5,570 | ||||||||
2020 | 4,560 | 46 | 4,606 | ||||||||
2021 | 4,560 | — | 4,560 | ||||||||
2022 | 1,270 | — | 1,270 | ||||||||
Total intangible assets, net | $ | 21,850 | $ | 506 | $ | 22,356 |
December 31, | |||||||
2017 | 2016 | ||||||
Product warranty | $ | 87,882 | $ | 99,923 | |||
Accrued manufacturing expense and freight | 41,901 | 75,579 | |||||
Accrued sales incentives | 111,592 | 74,181 | |||||
Accrued sales and marketing | 44,401 | 41,948 | |||||
Accrued research and development | 8,983 | 5,989 | |||||
Accrued co-op advertising and marketing development funds | 30,408 | 40,002 | |||||
Employee-related liabilities | 33,266 | 13,934 | |||||
Sales taxes and VAT payable | 21,340 | 8,891 | |||||
Inventory received but not billed | 10,526 | 7,363 | |||||
Accrued legal settlements and fees | 36,693 | 3,963 | |||||
Derivative liabilities | 2,138 | 3,780 | |||||
Other | 23,007 | 15,008 | |||||
Accrued liabilities | $ | 452,137 | $ | 390,561 |
Reserve For Product Warranty (1) | |||
Balance at December 31, 2014 | $ | 20,098 | |
Charged to cost of revenue | 84,184 | ||
Changes in estimate related to pre-existing warranties | (8,968 | ) | |
Settlement of claims | (55,102 | ) | |
Balance at December 31, 2015 | $ | 40,212 | |
Charged to cost of revenue | 185,434 | ||
Changes in estimate related to pre-existing warranties | 4,072 | ||
Settlement of claims | (129,795 | ) | |
Balance at December 31, 2016 | $ | 99,923 | |
Charged to cost of revenue | 53,840 | ||
Changes in estimate related to pre-existing warranties | 11,788 | ||
Settlement of claims | (77,669 | ) | |
Balance at December 31, 2017 | $ | 87,882 |
(1) | Does not include reserves established as a result of the recall of the Fitbit Force. See the section titled “—Fitbit Force Recall Reserve” for additional information regarding such reserves. |
Reserve For Fitbit Force Recall | |||
Balance at December 31, 2014 | $ | 22,476 | |
Charged to cost of revenue | (5,755 | ) | |
Charged to general and administrative | (1,174 | ) | |
Settlement of claims | (10,425 | ) | |
Balance at December 31, 2015 | 5,122 | ||
Settlement of claims | (3,869 | ) | |
Balance at December 31, 2016 | 1,253 | ||
Settlement of claims | (789 | ) | |
Balance at December 31, 2017 | $ | 464 |
Restructuring Reserve | |||
Balance at December 31, 2016 | $ | — | |
Restructuring charges | 6,375 | ||
Cash paid | (4,983 | ) | |
Other - noncash | (1,392 | ) | |
Balance at December 31, 2017 | $ | — |
Unrealized Gains on Cash Flow Hedges | Currency Translation Adjustments | Unrealized Gains (Losses) on Available-for-Sale Investments | Total | ||||||||||||
Balance at December 31, 2015 | $ | 751 | $ | (5 | ) | $ | (55 | ) | $ | 691 | |||||
Other comprehensive income (loss) before reclassifications | 9,422 | (309 | ) | (126 | ) | 8,987 | |||||||||
Amounts reclassified from AOCI | (10,650 | ) | — | (6 | ) | (10,656 | ) | ||||||||
Other comprehensive income (loss) | (1,228 | ) | (309 | ) | (132 | ) | (1,669 | ) | |||||||
Balance at December 31, 2016 | (477 | ) | (314 | ) | (187 | ) | (978 | ) | |||||||
Other comprehensive income (loss) before reclassifications | (19,422 | ) | 314 | 125 | (18,983 | ) | |||||||||
Amounts reclassified from AOCI | 19,965 | — | (13 | ) | 19,952 | ||||||||||
Other comprehensive income (loss) | 543 | 314 | 112 | 969 | |||||||||||
Balance at December 31, 2017 | $ | 66 | $ | — | $ | (75 | ) | $ | (9 | ) |
|
|
Year ending December 31, | Amounts | ||
2018 | $ | 40,856 | |
2019 | 46,713 | ||
2020 | 42,942 | ||
2021 | 41,331 | ||
2022 | 41,477 | ||
Thereafter | 58,879 | ||
Total | $ | 272,198 |
|
Stock Options Outstanding | ||||||||||||
Number of Shares Subject to Stock Options | Weighted– Average Exercise Price | Weighted– Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value | |||||||||
Balance—December 31, 2016 | 34,454 | $ | 3.85 | |||||||||
Granted | 1,150 | $ | 5.63 | |||||||||
Exercised | (7,164 | ) | $ | 1.22 | ||||||||
Canceled | (7,054 | ) | $ | 9.35 | ||||||||
Balance—December 31, 2017 | 21,386 | $ | 3.01 | 5.7 | $ | 64,582 | ||||||
Stock options exercisable—December 31, 2017 | 16,827 | $ | 2.52 | 5.3 | $ | 57,472 | ||||||
Stock options vested and expected to vest—December 31, 2017 | 21,386 | $ | 3.01 | 5.7 | $ | 64,582 |
RSUs Outstanding | Weighted- Average Grant Date Fair Value | |||||
(in thousands) | ||||||
Unvested balance—December 31, 2016 | 11,578 | $ | 16.85 | |||
Granted | 18,912 | 6.47 | ||||
Vested | (6,191 | ) | 12.57 | |||
Forfeited or canceled | (5,111 | ) | 12.61 | |||
Unvested balance—December 31, 2017 | 19,188 | 9.13 |
Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Cost of revenue | $ | 5,312 | $ | 4,797 | $ | 4,739 | |||||
Research and development | 54,123 | 47,207 | 18,251 | ||||||||
Sales and marketing | 14,959 | 11,575 | 7,419 | ||||||||
General and administrative | 17,187 | 15,853 | 10,615 | ||||||||
Total stock-based compensation expense | $ | 91,581 | $ | 79,432 | $ | 41,024 |
Year Ended December 31, | |||||
2017 | 2016 | 2015 | |||
Employee stock options | |||||
Expected term (in years) | 6.25 | 6.25 | 6.25 | ||
Volatility | 32.2% | 40.7% | 52.1% - 56.9% | ||
Risk-free interest rate | 2.1% | 1.6% | 1.5% - 1.9% | ||
Dividend yield | —% | —% | —% | ||
Warrants | |||||
Expected term (in years) | 9.5 | — | — | ||
Volatility | 32.0% | —% | —% | ||
Risk-free interest rate | 2.1% | —% | —% | ||
Dividend yield | —% | —% | —% | ||
Employee stock purchase plan | |||||
Expected term (in years) | 0.5 | 0.5 | 0.5 – 0.9 | ||
Volatility | 27.7% - 31.3% | 30.1% - 39.0% | 27.7% - 35.0% | ||
Risk-free interest rate | 1.0% - 1.4% | 0.4% - 0.6% | 0.3% | ||
Dividend yield | —% | —% | —% |
|
Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
United States | $ | (158,187 | ) | $ | 5,577 | $ | 286,380 | ||||
Foreign | (36,457 | ) | (114,872 | ) | 1,569 | ||||||
Total | $ | (194,644 | ) | $ | (109,295 | ) | $ | 287,949 |
Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Current: | |||||||||||
Federal | $ | (87,961 | ) | $ | 78,782 | $ | 140,396 | ||||
State | (8,429 | ) | 9,878 | 13,307 | |||||||
Foreign | 5,032 | 5,256 | 1,107 | ||||||||
Total current | (91,358 | ) | 93,916 | 154,810 | |||||||
Deferred: | |||||||||||
Federal | 154,817 | (87,584 | ) | (33,421 | ) | ||||||
State | 18,902 | (11,622 | ) | (8,941 | ) | ||||||
Foreign | 187 | (1,228 | ) | (176 | ) | ||||||
Total deferred | 173,906 | (100,434 | ) | (42,538 | ) | ||||||
Total income tax expense (benefit) | $ | 82,548 | $ | (6,518 | ) | $ | 112,272 |
Year Ended December 31, | ||||||||
2017 | 2016 | 2015 | ||||||
Tax at federal statutory rate | 35.0 | % | 35.0 | % | 35.0 | % | ||
State taxes, net of federal effect | (5.4 | ) | 4.3 | 1.5 | ||||
Foreign rate differential | (9.3 | ) | (38.9 | ) | (0.8 | ) | ||
Tax credits | 4.1 | 9.0 | (2.0 | ) | ||||
Domestic production activities deduction | (3.5 | ) | 5.0 | (3.3 | ) | |||
Stock-based compensation(1) | (5.3 | ) | (4.6 | ) | 1.7 | |||
Change in prior year reserves | (2.0 | ) | 1.9 | — | ||||
Out-of-period adjustment | — | (2.8 | ) | — | ||||
Warrant fair value adjustment | — | — | 6.9 | |||||
Change in valuation allowance | (35.2 | ) | — | — | ||||
Effect of change in tax rate due to Tax Act | (23.4 | ) | — | — | ||||
Other | 2.6 | (2.9 | ) | — | ||||
Effective tax rate | (42.4 | )% | 6.0 | % | 39.0 | % |
December 31, | |||||||
2017 | 2016 | ||||||
Deferred tax assets: | |||||||
Net operating losses and credits | $ | 23,338 | $ | 9,446 | |||
Fixed assets and intangible assets | 10,625 | 16,272 | |||||
Accruals and reserves | 49,886 | 112,915 | |||||
Stock-based compensation | 12,154 | 17,864 | |||||
Inventory | 4,345 | 8,513 | |||||
Other | 3,325 | 11,134 | |||||
Total deferred tax assets | 103,673 | 176,144 | |||||
Less: valuation allowance | (99,570 | ) | — | ||||
Deferred tax assets, net of valuation allowance | 4,103 | 176,144 | |||||
Deferred tax liabilities: | |||||||
Other | (369 | ) | (353 | ) | |||
Total deferred tax liabilities | (369 | ) | (353 | ) | |||
Net deferred tax assets | $ | 3,734 | $ | 175,791 |
December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Balance at beginning of year | $ | 35,584 | $ | 23,518 | $ | 10,594 | |||||
Reductions based on tax positions related to prior year | (6,335 | ) | (2,100 | ) | (18 | ) | |||||
Additions based on tax positions related to prior year | 108 | 2,809 | — | ||||||||
Additions based on tax positions related to current year | 9,289 | 11,357 | 12,942 | ||||||||
Reductions due to tax authorities’ settlements | (8,603 | ) | — | — | |||||||
Reductions due to expiration of statutes of limitation | (105 | ) | — | — | |||||||
Balance at end of year | $ | 29,938 | $ | 35,584 | $ | 23,518 |
|
December 31, | ||||||||
2017 | 2016 | 2015 | ||||||
C | 13 | % | 14 | % | 14 | % | ||
A | * | 14 | 15 | |||||
B | * | 10 | 14 |
* | Revenue was less than 10%. |
December 31, | |||||
2017 | 2016 | ||||
C | 17 | % | 19 | % | |
B | 13 | * | |||
E | 11 | * | |||
A | * | 16 | |||
D | * | 12 |
* | Accounts receivable were less than 10%. |
December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
United States | $ | 944,052 | $ | 1,539,600 | $ | 1,381,152 | |||||
Americas excluding United States | 116,330 | 110,111 | 92,252 | ||||||||
Europe, Middle East, and Africa | 440,135 | 389,154 | 208,767 | ||||||||
APAC | 115,002 | 130,596 | 175,827 | ||||||||
Total | $ | 1,615,519 | $ | 2,169,461 | $ | 1,857,998 |
|
Goodwill | $ | 22,157 | |
Developed and core technology | 12,640 | ||
Customer relationships | 128 | ||
Trademarks | 1,150 | ||
Assumed liabilities, net of assets | (3,552 | ) | |
Total | $ | 32,523 |
|
Three Months Ended | |||||||||||||||
December 31, 2017(3) | September 30, 2017(2) | July 1, 2017 | April 1, 2017(1) | ||||||||||||
Revenue | $ | 570,756 | $ | 392,522 | $ | 353,299 | $ | 298,942 | |||||||
Gross profit | $ | 248,597 | $ | 174,760 | $ | 149,245 | $ | 118,299 | |||||||
Net loss | $ | (45,470 | ) | $ | (113,403 | ) | $ | (58,240 | ) | $ | (60,079 | ) | |||
Net loss per share attributable to common stockholders—basic | $ | (0.19 | ) | $ | (0.48 | ) | $ | (0.25 | ) | $ | (0.27 | ) | |||
Net loss per share attributable to common stockholders—diluted | $ | (0.19 | ) | $ | (0.48 | ) | $ | (0.25 | ) | $ | (0.27 | ) |
Three Months Ended | |||||||||||||||
December 31, 2016 | October 1, 2016 | July 2, 2016 | April 2, 2016 | ||||||||||||
Revenue | $ | 573,775 | $ | 503,802 | $ | 586,528 | $ | 505,356 | |||||||
Gross profit | $ | 126,502 | $ | 240,658 | $ | 244,969 | $ | 233,755 | |||||||
Net income (loss) | $ | (146,273 | ) | $ | 26,120 | $ | 6,341 | $ | 11,035 | ||||||
Net income (loss) per share attributable to common stockholders—basic | $ | (0.65 | ) | $ | 0.12 | $ | 0.03 | $ | 0.05 | ||||||
Net income (loss) per share attributable to common stockholders—diluted | $ | (0.65 | ) | $ | 0.11 | $ | 0.03 | $ | 0.05 |
(1) | During the first quarter of 2017, the Company recorded restructuring expenses of $6.3 million. See Note 5. Balance Sheet Components for more information. In addition, the Company’s adoption of ASU 2016-09 on January 1, 2017 resulted in an increase to the provision for income taxes of $2.8 million. See Note 2. Significant Accounting Policies for more information. |
(2) | During the third quarter of 2017, as a result of one of the Company’s customers filing for bankruptcy, the Company recorded a net charge of $9.0 million comprised of net bad debt expense of $7.6 million and net cost of revenue of $1.4 million. See Note 1. Customer Bankruptcy for more information. In addition, during the third quarter of 2017, the Company recorded a $111.4 million valuation allowance against a portion of its U.S. deferred taxes. |
(3) | During the fourth quarter of 2017, as a result of the Tax Act, the Company recorded a provisional tax expense for the impact of the 2017 Tax Act of $45.5 million as a result of re-measurement of the federal portion of its deferred tax assets as of December 31, 2017 from 35% to the new 21% tax rate. |
|
|
Tooling and manufacturing equipment | One to three years | |
Furniture and office equipment | Three years | |
Purchased software | Three years | |
Capitalized internally-developed software | Two to eight years | |
Leasehold improvements | Shorter of remaining lease term or ten years |
• | Retailers and distributors are generally allowed to return products that were originally sold through to an end-user under provisions of their contracts, called “open-box” returns, and such returns may be made at any time after the original sale. |
• | All purchases through Fitbit.com are covered by a 45-day right of return. |
• | Certain distributors are allowed stock rotation rights which are limited rights of return of products purchased during a prior period, generally one quarter. |
• | Certain distributors and retailers are allowed return rights for defective products. |
• | Certain distributors are offered price protection that allows for the right to a partial credit for unsold inventory held by the distributor if the Company reduces the selling price of a product. |
• | refunds and product returns from retailer and distributor customers and end-users, which were charged to revenue and cost of revenue on the consolidated statements of operations; |
• | logistics and handling fees for managing product returns and processing refunds, obsolescence of on-hand inventory, cancellation charges for existing purchase commitments and rework of component inventory by the Company’s contract manufacturers, accelerated depreciation of tooling and manufacturing equipment, which were charged to cost of revenue on the consolidated statements of operations; and |
• | legal fees and settlement costs, which were charged to general and administrative expenses on the consolidated statements of operations. |
|
Tooling and manufacturing equipment | One to three years | |
Furniture and office equipment | Three years | |
Purchased software | Three years | |
Capitalized internally-developed software | Two to eight years | |
Leasehold improvements | Shorter of remaining lease term or ten years |
December 31, | |||||||
2017 | 2016 | ||||||
Tooling and manufacturing equipment | $ | 66,854 | $ | 60,944 | |||
Furniture and office equipment | 20,942 | 14,424 | |||||
Purchased and internally-developed software | 18,112 | 12,032 | |||||
Leasehold improvements | 58,431 | 28,489 | |||||
Total property and equipment | 164,339 | 115,889 | |||||
Less: Accumulated depreciation and amortization | (59,431 | ) | (39,336 | ) | |||
Property and equipment, net | $ | 104,908 | $ | 76,553 |
|
December 31, 2017 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | |||||||||||||||
Money market funds | $ | 193,066 | $ | — | $ | — | $ | 193,066 | |||||||
U.S. government agencies | — | 79,624 | — | 79,624 | |||||||||||
Corporate debt securities | — | 291,582 | — | 291,582 | |||||||||||
Total | $ | 193,066 | $ | 371,206 | $ | — | $ | 564,272 | |||||||
Liabilities: | |||||||||||||||
Derivative liabilities | $ | — | $ | 2,138 | $ | — | $ | 2,138 | |||||||
Stock warrant liability | — | — | 208 | 208 | |||||||||||
$ | — | $ | 2,138 | $ | 208 | $ | 2,346 |
December 31, 2016 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | |||||||||||||||
Money market funds | $ | 50,125 | $ | — | $ | — | $ | 50,125 | |||||||
U.S. government agencies | — | 86,526 | — | 86,526 | |||||||||||
Corporate debt securities | — | 390,286 | — | 390,286 | |||||||||||
Derivative assets | — | 10,625 | — | 10,625 | |||||||||||
Total | $ | 50,125 | $ | 487,437 | $ | — | $ | 537,562 | |||||||
Liabilities: | |||||||||||||||
Derivative liabilities | $ | — | $ | 3,780 | $ | — | $ | 3,780 |
|
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Cash and Cash Equivalents | Marketable Securities | ||||||||||||||||||
Cash | $ | 115,028 | $ | — | $ | — | $ | 115,028 | $ | 115,028 | $ | — | |||||||||||
Money market funds | 193,066 | — | — | 193,066 | 193,066 | — | |||||||||||||||||
U.S. government agencies | 79,722 | 1 | (99 | ) | 79,624 | 6,595 | 73,029 | ||||||||||||||||
Corporate debt securities | 291,738 | 15 | (171 | ) | 291,582 | 27,277 | 264,305 | ||||||||||||||||
Total | $ | 679,554 | $ | 16 | $ | (270 | ) | $ | 679,300 | $ | 341,966 | $ | 337,334 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Cash and Cash Equivalents | Marketable Securities | ||||||||||||||||||
Cash | $ | 179,076 | $ | — | $ | — | $ | 179,076 | $ | 179,076 | $ | — | |||||||||||
Money market funds | 50,125 | — | — | 50,125 | 50,125 | — | |||||||||||||||||
U.S. government agencies | 86,533 | 8 | (15 | ) | 86,526 | — | 86,526 | ||||||||||||||||
Corporate debt securities | 390,466 | 24 | (204 | ) | 390,286 | 72,119 | 318,167 | ||||||||||||||||
Total | $ | 706,200 | $ | 32 | $ | (219 | ) | $ | 706,013 | $ | 301,320 | $ | 404,693 |
December 31, 2017 | December 31, 2016 | ||||||
Due in one year | $ | 319,112 | $ | 355,152 | |||
Due in one to two years | 18,222 | 49,541 | |||||
Total | $ | 337,334 | $ | 404,693 |
December 31, 2017 | December 31, 2016 | ||||||||||||||||
Balance Sheet Location | Fair Value Derivative Assets | Fair Value Derivative Liabilities | Fair Value Derivative Assets | Fair Value Derivative Liabilities | |||||||||||||
Cash flow designated hedges | Prepaid expense and other current assets | $ | — | $ | — | $ | 813 | $ | — | ||||||||
Cash flow designated hedges | Accrued liabilities | — | — | — | 1,428 | ||||||||||||
Hedges not designated | Prepaid expense and other current assets | — | — | 9,812 | — | ||||||||||||
Hedges not designated | Accrued liabilities | — | 2,138 | — | 2,352 | ||||||||||||
Total fair value of derivative instruments | $ | — | $ | 2,138 | $ | 10,625 | $ | 3,780 |
Year Ended December 31, | |||||||||||||
Income Statement Location | 2017 | 2016 | 2015 | ||||||||||
Foreign exchange cash flow hedges: | |||||||||||||
Gain (loss) recognized in OCI—effective portion | $ | (19,436 | ) | $ | 8,171 | $ | 2,785 | ||||||
Gain (loss) reclassified from OCI into income—effective portion | Revenue | (18,532 | ) | 10,153 | 2,183 | ||||||||
Gain (loss) reclassified from OCI into income—effective portion | Operating expenses | (1,405 | ) | 17 | (899 | ) | |||||||
Gain (loss) recognized in income—ineffective portion | Other income (expense), net | 21 | (1,026 | ) | 202 | ||||||||
Gain (loss) recognized in income—excluded time value portion | Other income (expense), net | 1,771 | — | — | |||||||||
Foreign exchange balance sheet hedges: | |||||||||||||
Gain (loss) recognized in income | Other income (expense), net | $ | (10,516 | ) | $ | 10,916 | $ | 5,861 |
Year Ended December 31, | |||||||||||||
Income Statement Location | 2017 | 2016 | 2015 | ||||||||||
Foreign exchange cash flow hedges: | |||||||||||||
Gain (loss) recognized in OCI—effective portion | $ | (19,436 | ) | $ | 8,171 | $ | 2,785 | ||||||
Gain (loss) reclassified from OCI into income—effective portion | Revenue | (18,532 | ) | 10,153 | 2,183 | ||||||||
Gain (loss) reclassified from OCI into income—effective portion | Operating expenses | (1,405 | ) | 17 | (899 | ) | |||||||
Gain (loss) recognized in income—ineffective portion | Other income (expense), net | 21 | (1,026 | ) | 202 | ||||||||
Gain (loss) recognized in income—excluded time value portion | Other income (expense), net | 1,771 | — | — | |||||||||
Foreign exchange balance sheet hedges: | |||||||||||||
Gain (loss) recognized in income | Other income (expense), net | $ | (10,516 | ) | $ | 10,916 | $ | 5,861 |
December 31, 2017 | |||||||||||||||||||||||
Gross Amounts Offset in the Consolidated Balance Sheets | Gross Amounts Not Offset in Consolidated Balance Sheets | ||||||||||||||||||||||
Gross Amount Recognized | Gross Amount Offset | Net Amount Presented | Financial Instruments | Cash Collateral Received | Net Amount | ||||||||||||||||||
Foreign exchange contracts assets | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
Foreign exchange contracts liabilities | 2,138 | — | 2,138 | — | — | 2,138 |
December 31, 2016 | |||||||||||||||||||||||
Gross Amounts Offset in the Consolidated Balance Sheets | Gross Amounts Not Offset in Consolidated Balance Sheets | ||||||||||||||||||||||
Gross Amounts Recognized | Gross Amounts Offset | Net Amount Presented | Financial Instruments | Cash Collateral Received | Net Amount | ||||||||||||||||||
Foreign exchange contracts assets | $ | 10,625 | $ | — | $ | 10,625 | $ | 3,780 | $ | — | $ | 6,845 | |||||||||||
Foreign exchange contracts liabilities | 3,780 | — | 3,780 | 3,780 | — | — |
December 31, 2017 | |||||||||||||||||||||||
Gross Amounts Offset in the Consolidated Balance Sheets | Gross Amounts Not Offset in Consolidated Balance Sheets | ||||||||||||||||||||||
Gross Amount Recognized | Gross Amount Offset | Net Amount Presented | Financial Instruments | Cash Collateral Received | Net Amount | ||||||||||||||||||
Foreign exchange contracts assets | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
Foreign exchange contracts liabilities | 2,138 | — | 2,138 | — | — | 2,138 |
December 31, 2016 | |||||||||||||||||||||||
Gross Amounts Offset in the Consolidated Balance Sheets | Gross Amounts Not Offset in Consolidated Balance Sheets | ||||||||||||||||||||||
Gross Amounts Recognized | Gross Amounts Offset | Net Amount Presented | Financial Instruments | Cash Collateral Received | Net Amount | ||||||||||||||||||
Foreign exchange contracts assets | $ | 10,625 | $ | — | $ | 10,625 | $ | 3,780 | $ | — | $ | 6,845 | |||||||||||
Foreign exchange contracts liabilities | 3,780 | — | 3,780 | 3,780 | — | — |
|
Allowance for Doubtful Accounts | Revenue Returns Reserve(1) | ||||||
Balance at December 31, 2014 | 838 | 26,559 | |||||
Increases | 1,115 | 169,677 | |||||
Write-offs/returns taken | (128 | ) | (122,191 | ) | |||
Balance at December 31, 2015 | 1,825 | 74,045 | |||||
Increases | 339 | 275,815 | |||||
Write-offs/returns taken | (1,882 | ) | (251,009 | ) | |||
Balance at December 31, 2016 | 282 | 98,851 | |||||
Increases(2) | 30,551 | 229,610 | |||||
Write-offs/returns taken(2) | (21,604 | ) | (218,589 | ) | |||
Balance at December 31, 2017 | $ | 9,229 | $ | 109,872 |
December 31, | |||||||
2017 | 2016 | ||||||
Components | $ | 3,825 | $ | 1,035 | |||
Finished goods | 120,070 | 229,352 | |||||
Total inventories | $ | 123,895 | $ | 230,387 |
December 31, | |||||||
2017 | 2016 | ||||||
POP displays, net | $ | 14,750 | $ | 22,804 | |||
Prepaid expenses | 24,204 | 17,161 | |||||
Derivative assets | — | 10,625 | |||||
Prepaid marketing | 6,074 | 5,764 | |||||
Insurance receivable | 37,300 | — | |||||
Other | 14,941 | 9,511 | |||||
Total prepaid expenses and other current assets | $ | 97,269 | $ | 65,865 |
Tooling and manufacturing equipment | One to three years | |
Furniture and office equipment | Three years | |
Purchased software | Three years | |
Capitalized internally-developed software | Two to eight years | |
Leasehold improvements | Shorter of remaining lease term or ten years |
December 31, | |||||||
2017 | 2016 | ||||||
Tooling and manufacturing equipment | $ | 66,854 | $ | 60,944 | |||
Furniture and office equipment | 20,942 | 14,424 | |||||
Purchased and internally-developed software | 18,112 | 12,032 | |||||
Leasehold improvements | 58,431 | 28,489 | |||||
Total property and equipment | 164,339 | 115,889 | |||||
Less: Accumulated depreciation and amortization | (59,431 | ) | (39,336 | ) | |||
Property and equipment, net | $ | 104,908 | $ | 76,553 |
Goodwill | |||
Balance at December 31, 2015 | $ | 22,157 | |
Goodwill acquired | 28,879 | ||
Balance at December 31, 2016 | $ | 51,036 | |
Goodwill acquired | — | ||
Balance at December 31, 2017 | $ | 51,036 |
December 31, 2017 | December 31, 2016 | Weighted Average Remaining Useful Life (years) | |||||||||||||||||||||||
Gross | Accumulated Amortization | Net | Gross | Accumulated Amortization | Net | ||||||||||||||||||||
Developed technology | $ | 30,588 | $ | (8,738 | ) | $ | 21,850 | $ | 26,092 | $ | (3,247 | ) | $ | 22,845 | 4.0 | ||||||||||
Trademarks and other | 1,278 | (772 | ) | 506 | 1,278 | (542 | ) | 736 | 0.9 | ||||||||||||||||
Total finite-lived intangible assets subject to amortization, net | 31,866 | (9,510 | ) | 22,356 | 27,370 | (3,789 | ) | 23,581 | |||||||||||||||||
In-process research and development | — | — | — | 3,940 | — | 3,940 | |||||||||||||||||||
Total intangible assets, net | $ | 31,866 | $ | (9,510 | ) | $ | 22,356 | $ | 31,310 | $ | (3,789 | ) | $ | 27,521 |
Cost of Revenue | Operating Expenses | Total | |||||||||
2018 | $ | 6,120 | $ | 230 | $ | 6,350 | |||||
2019 | 5,340 | 230 | 5,570 | ||||||||
2020 | 4,560 | 46 | 4,606 | ||||||||
2021 | 4,560 | — | 4,560 | ||||||||
2022 | 1,270 | — | 1,270 | ||||||||
Total intangible assets, net | $ | 21,850 | $ | 506 | $ | 22,356 |
December 31, | |||||||
2017 | 2016 | ||||||
Product warranty | $ | 87,882 | $ | 99,923 | |||
Accrued manufacturing expense and freight | 41,901 | 75,579 | |||||
Accrued sales incentives | 111,592 | 74,181 | |||||
Accrued sales and marketing | 44,401 | 41,948 | |||||
Accrued research and development | 8,983 | 5,989 | |||||
Accrued co-op advertising and marketing development funds | 30,408 | 40,002 | |||||
Employee-related liabilities | 33,266 | 13,934 | |||||
Sales taxes and VAT payable | 21,340 | 8,891 | |||||
Inventory received but not billed | 10,526 | 7,363 | |||||
Accrued legal settlements and fees | 36,693 | 3,963 | |||||
Derivative liabilities | 2,138 | 3,780 | |||||
Other | 23,007 | 15,008 | |||||
Accrued liabilities | $ | 452,137 | $ | 390,561 |
Reserve For Product Warranty (1) | |||
Balance at December 31, 2014 | $ | 20,098 | |
Charged to cost of revenue | 84,184 | ||
Changes in estimate related to pre-existing warranties | (8,968 | ) | |
Settlement of claims | (55,102 | ) | |
Balance at December 31, 2015 | $ | 40,212 | |
Charged to cost of revenue | 185,434 | ||
Changes in estimate related to pre-existing warranties | 4,072 | ||
Settlement of claims | (129,795 | ) | |
Balance at December 31, 2016 | $ | 99,923 | |
Charged to cost of revenue | 53,840 | ||
Changes in estimate related to pre-existing warranties | 11,788 | ||
Settlement of claims | (77,669 | ) | |
Balance at December 31, 2017 | $ | 87,882 |
(1) | Does not include reserves established as a result of the recall of the Fitbit Force. See the section titled “—Fitbit Force Recall Reserve” for additional information regarding such reserves. |
Reserve For Fitbit Force Recall | |||
Balance at December 31, 2014 | $ | 22,476 | |
Charged to cost of revenue | (5,755 | ) | |
Charged to general and administrative | (1,174 | ) | |
Settlement of claims | (10,425 | ) | |
Balance at December 31, 2015 | 5,122 | ||
Settlement of claims | (3,869 | ) | |
Balance at December 31, 2016 | 1,253 | ||
Settlement of claims | (789 | ) | |
Balance at December 31, 2017 | $ | 464 |
Restructuring Reserve | |||
Balance at December 31, 2016 | $ | — | |
Restructuring charges | 6,375 | ||
Cash paid | (4,983 | ) | |
Other - noncash | (1,392 | ) | |
Balance at December 31, 2017 | $ | — |
Unrealized Gains on Cash Flow Hedges | Currency Translation Adjustments | Unrealized Gains (Losses) on Available-for-Sale Investments | Total | ||||||||||||
Balance at December 31, 2015 | $ | 751 | $ | (5 | ) | $ | (55 | ) | $ | 691 | |||||
Other comprehensive income (loss) before reclassifications | 9,422 | (309 | ) | (126 | ) | 8,987 | |||||||||
Amounts reclassified from AOCI | (10,650 | ) | — | (6 | ) | (10,656 | ) | ||||||||
Other comprehensive income (loss) | (1,228 | ) | (309 | ) | (132 | ) | (1,669 | ) | |||||||
Balance at December 31, 2016 | (477 | ) | (314 | ) | (187 | ) | (978 | ) | |||||||
Other comprehensive income (loss) before reclassifications | (19,422 | ) | 314 | 125 | (18,983 | ) | |||||||||
Amounts reclassified from AOCI | 19,965 | — | (13 | ) | 19,952 | ||||||||||
Other comprehensive income (loss) | 543 | 314 | 112 | 969 | |||||||||||
Balance at December 31, 2017 | $ | 66 | $ | — | $ | (75 | ) | $ | (9 | ) |
|
Year ending December 31, | Amounts | ||
2018 | $ | 40,856 | |
2019 | 46,713 | ||
2020 | 42,942 | ||
2021 | 41,331 | ||
2022 | 41,477 | ||
Thereafter | 58,879 | ||
Total | $ | 272,198 |
|
Stock Options Outstanding | ||||||||||||
Number of Shares Subject to Stock Options | Weighted– Average Exercise Price | Weighted– Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value | |||||||||
Balance—December 31, 2016 | 34,454 | $ | 3.85 | |||||||||
Granted | 1,150 | $ | 5.63 | |||||||||
Exercised | (7,164 | ) | $ | 1.22 | ||||||||
Canceled | (7,054 | ) | $ | 9.35 | ||||||||
Balance—December 31, 2017 | 21,386 | $ | 3.01 | 5.7 | $ | 64,582 | ||||||
Stock options exercisable—December 31, 2017 | 16,827 | $ | 2.52 | 5.3 | $ | 57,472 | ||||||
Stock options vested and expected to vest—December 31, 2017 | 21,386 | $ | 3.01 | 5.7 | $ | 64,582 |
RSUs Outstanding | Weighted- Average Grant Date Fair Value | |||||
(in thousands) | ||||||
Unvested balance—December 31, 2016 | 11,578 | $ | 16.85 | |||
Granted | 18,912 | 6.47 | ||||
Vested | (6,191 | ) | 12.57 | |||
Forfeited or canceled | (5,111 | ) | 12.61 | |||
Unvested balance—December 31, 2017 | 19,188 | 9.13 |
Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Cost of revenue | $ | 5,312 | $ | 4,797 | $ | 4,739 | |||||
Research and development | 54,123 | 47,207 | 18,251 | ||||||||
Sales and marketing | 14,959 | 11,575 | 7,419 | ||||||||
General and administrative | 17,187 | 15,853 | 10,615 | ||||||||
Total stock-based compensation expense | $ | 91,581 | $ | 79,432 | $ | 41,024 |
Year Ended December 31, | |||||
2017 | 2016 | 2015 | |||
Employee stock options | |||||
Expected term (in years) | 6.25 | 6.25 | 6.25 | ||
Volatility | 32.2% | 40.7% | 52.1% - 56.9% | ||
Risk-free interest rate | 2.1% | 1.6% | 1.5% - 1.9% | ||
Dividend yield | —% | —% | —% | ||
Warrants | |||||
Expected term (in years) | 9.5 | — | — | ||
Volatility | 32.0% | —% | —% | ||
Risk-free interest rate | 2.1% | —% | —% | ||
Dividend yield | —% | —% | —% | ||
Employee stock purchase plan | |||||
Expected term (in years) | 0.5 | 0.5 | 0.5 – 0.9 | ||
Volatility | 27.7% - 31.3% | 30.1% - 39.0% | 27.7% - 35.0% | ||
Risk-free interest rate | 1.0% - 1.4% | 0.4% - 0.6% | 0.3% | ||
Dividend yield | —% | —% | —% |
|
Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
United States | $ | (158,187 | ) | $ | 5,577 | $ | 286,380 | ||||
Foreign | (36,457 | ) | (114,872 | ) | 1,569 | ||||||
Total | $ | (194,644 | ) | $ | (109,295 | ) | $ | 287,949 |
Year Ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Current: | |||||||||||
Federal | $ | (87,961 | ) | $ | 78,782 | $ | 140,396 | ||||
State | (8,429 | ) | 9,878 | 13,307 | |||||||
Foreign | 5,032 | 5,256 | 1,107 | ||||||||
Total current | (91,358 | ) | 93,916 | 154,810 | |||||||
Deferred: | |||||||||||
Federal | 154,817 | (87,584 | ) | (33,421 | ) | ||||||
State | 18,902 | (11,622 | ) | (8,941 | ) | ||||||
Foreign | 187 | (1,228 | ) | (176 | ) | ||||||
Total deferred | 173,906 | (100,434 | ) | (42,538 | ) | ||||||
Total income tax expense (benefit) | $ | 82,548 | $ | (6,518 | ) | $ | 112,272 |
Year Ended December 31, | ||||||||
2017 | 2016 | 2015 | ||||||
Tax at federal statutory rate | 35.0 | % | 35.0 | % | 35.0 | % | ||
State taxes, net of federal effect | (5.4 | ) | 4.3 | 1.5 | ||||
Foreign rate differential | (9.3 | ) | (38.9 | ) | (0.8 | ) | ||
Tax credits | 4.1 | 9.0 | (2.0 | ) | ||||
Domestic production activities deduction | (3.5 | ) | 5.0 | (3.3 | ) | |||
Stock-based compensation(1) | (5.3 | ) | (4.6 | ) | 1.7 | |||
Change in prior year reserves | (2.0 | ) | 1.9 | — | ||||
Out-of-period adjustment | — | (2.8 | ) | — | ||||
Warrant fair value adjustment | — | — | 6.9 | |||||
Change in valuation allowance | (35.2 | ) | — | — | ||||
Effect of change in tax rate due to Tax Act | (23.4 | ) | — | — | ||||
Other | 2.6 | (2.9 | ) | — | ||||
Effective tax rate | (42.4 | )% | 6.0 | % | 39.0 | % |
December 31, | |||||||
2017 | 2016 | ||||||
Deferred tax assets: | |||||||
Net operating losses and credits | $ | 23,338 | $ | 9,446 | |||
Fixed assets and intangible assets | 10,625 | 16,272 | |||||
Accruals and reserves | 49,886 | 112,915 | |||||
Stock-based compensation | 12,154 | 17,864 | |||||
Inventory | 4,345 | 8,513 | |||||
Other | 3,325 | 11,134 | |||||
Total deferred tax assets | 103,673 | 176,144 | |||||
Less: valuation allowance | (99,570 | ) | — | ||||
Deferred tax assets, net of valuation allowance | 4,103 | 176,144 | |||||
Deferred tax liabilities: | |||||||
Other | (369 | ) | (353 | ) | |||
Total deferred tax liabilities | (369 | ) | (353 | ) | |||
Net deferred tax assets | $ | 3,734 | $ | 175,791 |
December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Balance at beginning of year | $ | 35,584 | $ | 23,518 | $ | 10,594 | |||||
Reductions based on tax positions related to prior year | (6,335 | ) | (2,100 | ) | (18 | ) | |||||
Additions based on tax positions related to prior year | 108 | 2,809 | — | ||||||||
Additions based on tax positions related to current year | 9,289 | 11,357 | 12,942 | ||||||||
Reductions due to tax authorities’ settlements | (8,603 | ) | — | — | |||||||
Reductions due to expiration of statutes of limitation | (105 | ) | — | — | |||||||
Balance at end of year | $ | 29,938 | $ | 35,584 | $ | 23,518 |
|
December 31, | ||||||||
2017 | 2016 | 2015 | ||||||
C | 13 | % | 14 | % | 14 | % | ||
A | * | 14 | 15 | |||||
B | * | 10 | 14 |
* | Revenue was less than 10%. |
December 31, | |||||
2017 | 2016 | ||||
C | 17 | % | 19 | % | |
B | 13 | * | |||
E | 11 | * | |||
A | * | 16 | |||
D | * | 12 |
* | Accounts receivable were less than 10%. |
December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
United States | $ | 944,052 | $ | 1,539,600 | $ | 1,381,152 | |||||
Americas excluding United States | 116,330 | 110,111 | 92,252 | ||||||||
Europe, Middle East, and Africa | 440,135 | 389,154 | 208,767 | ||||||||
APAC | 115,002 | 130,596 | 175,827 | ||||||||
Total | $ | 1,615,519 | $ | 2,169,461 | $ | 1,857,998 |
|
Goodwill | $ | 22,157 | |
Developed and core technology | 12,640 | ||
Customer relationships | 128 | ||
Trademarks | 1,150 | ||
Assumed liabilities, net of assets | (3,552 | ) | |
Total | $ | 32,523 |
|
Three Months Ended | |||||||||||||||
December 31, 2017(3) | September 30, 2017(2) | July 1, 2017 | April 1, 2017(1) | ||||||||||||
Revenue | $ | 570,756 | $ | 392,522 | $ | 353,299 | $ | 298,942 | |||||||
Gross profit | $ | 248,597 | $ | 174,760 | $ | 149,245 | $ | 118,299 | |||||||
Net loss | $ | (45,470 | ) | $ | (113,403 | ) | $ | (58,240 | ) | $ | (60,079 | ) | |||
Net loss per share attributable to common stockholders—basic | $ | (0.19 | ) | $ | (0.48 | ) | $ | (0.25 | ) | $ | (0.27 | ) | |||
Net loss per share attributable to common stockholders—diluted | $ | (0.19 | ) | $ | (0.48 | ) | $ | (0.25 | ) | $ | (0.27 | ) |
Three Months Ended | |||||||||||||||
December 31, 2016 | October 1, 2016 | July 2, 2016 | April 2, 2016 | ||||||||||||
Revenue | $ | 573,775 | $ | 503,802 | $ | 586,528 | $ | 505,356 | |||||||
Gross profit | $ | 126,502 | $ | 240,658 | $ | 244,969 | $ | 233,755 | |||||||
Net income (loss) | $ | (146,273 | ) | $ | 26,120 | $ | 6,341 | $ | 11,035 | ||||||
Net income (loss) per share attributable to common stockholders—basic | $ | (0.65 | ) | $ | 0.12 | $ | 0.03 | $ | 0.05 | ||||||
Net income (loss) per share attributable to common stockholders—diluted | $ | (0.65 | ) | $ | 0.11 | $ | 0.03 | $ | 0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|