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• | 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 original sale. |
• | All purchases through Fitbit.com are covered by a 45-day right of return. |
• | Distributors are allowed stock rotation rights which are limited rights of return of products purchased during a prior period, generally one quarter. |
• | 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. |
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July 1, 2017 | |||||||||||
Level 1 | Level 2 | Total | |||||||||
Assets: | |||||||||||
Money market funds | $ | 161,762 | $ | — | $ | 161,762 | |||||
U.S. government agencies | — | 39,961 | 39,961 | ||||||||
Corporate debt securities | — | 353,046 | 353,046 | ||||||||
Derivative assets | — | 361 | 361 | ||||||||
Total | $ | 161,762 | $ | 393,368 | $ | 555,130 | |||||
Liabilities: | |||||||||||
Derivative liabilities | $ | — | $ | 13,869 | $ | 13,869 |
December 31, 2016 | |||||||||||
Level 1 | Level 2 | 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 |
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Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Cash and Cash Equivalents | Marketable Securities | ||||||||||||||||||
Cash | $ | 121,029 | $ | — | $ | — | $ | 121,029 | $ | 121,029 | $ | — | |||||||||||
Money market funds | 161,762 | — | — | 161,762 | 161,762 | — | |||||||||||||||||
U.S. government agencies | 39,974 | 1 | (14 | ) | 39,961 | 21,926 | 18,035 | ||||||||||||||||
Corporate debt securities | 353,108 | 64 | (126 | ) | 353,046 | 13,991 | 339,055 | ||||||||||||||||
Total | $ | 675,873 | $ | 65 | $ | (140 | ) | $ | 675,798 | $ | 318,708 | $ | 357,090 |
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 |
July 1, 2017 | December 31, 2016 | ||||||
Due in one year | $ | 340,293 | $ | 355,152 | |||
Due in one to two years | 16,797 | 49,541 | |||||
Total | $ | 357,090 | $ | 404,693 |
July 1, 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 expenses and other current assets | $ | — | $ | — | $ | 813 | $ | — | ||||||||
Cash flow designated hedges | Accrued liabilities | — | 12,081 | — | 1,428 | ||||||||||||
Hedges not designated | Prepaid expenses and other current assets | 361 | — | 9,812 | — | ||||||||||||
Hedges not designated | Accrued liabilities | — | 1,788 | — | 2,352 | ||||||||||||
Total fair value of derivative instruments | $ | 361 | $ | 13,869 | $ | 10,625 | $ | 3,780 |
Three Months Ended | Six Months Ended | ||||||||||||||||
Income Statement Location | July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | |||||||||||||
Foreign exchange cash flow hedges: | |||||||||||||||||
Gain (loss) recognized in OCI – effective portion | $ | (13,029 | ) | $ | 5,783 | $ | (13,987 | ) | $ | 1,535 | |||||||
Loss reclassified from OCI into income – effective portion | Revenue | (1,035 | ) | (1,380 | ) | (280 | ) | (1,550 | ) | ||||||||
Gain (loss) reclassified from OCI into income – effective portion | Operating expenses | (440 | ) | 1,393 | (1,405 | ) | 2,408 | ||||||||||
Gain (loss) recognized in income – ineffective portion | Other income (expense), net | — | (95 | ) | 21 | (185 | ) | ||||||||||
Gain recognized in income – excluded time value portion | Other income (expense), net | 660 | — | 843 | — | ||||||||||||
Foreign exchange balance sheet hedges: | |||||||||||||||||
Loss recognized in income | Other income (expense), net | (3,547 | ) | (72 | ) | (6,776 | ) | (209 | ) |
Gross Amounts Offset in the Condensed Consolidated Balance Sheets | Gross Amounts Not Offset in Condensed Consolidated Balance Sheets | ||||||||||||||||||||||
July 1, 2017 | Gross Amounts Recognized | Gross Amounts Offset | Net Amounts Presented | Financial Instruments | Cash Collateral Received | Net Amount | |||||||||||||||||
Foreign exchange contracts assets | $ | 361 | $ | — | $ | 361 | $ | 361 | $ | — | $ | — | |||||||||||
Foreign exchange contracts liabilities | $ | 13,869 | $ | — | $ | 13,869 | $ | 361 | $ | — | $ | 13,508 | |||||||||||
Gross Amounts Offset in the Condensed Consolidated Balance Sheets | Gross Amounts Not Offset in Condensed Consolidated Balance Sheets | ||||||||||||||||||||||
December 31, 2016 | Gross Amounts Recognized | Gross Amounts Offset | Net Amounts 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 | $ | — | $ | — |
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Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
Beginning balances | $ | 68,317 | $ | 55,875 | $ | 98,851 | $ | 74,045 | |||||||
Increases | 48,285 | 85,335 | 89,911 | 119,550 | |||||||||||
Returns taken | (65,082 | ) | (60,933 | ) | (137,242 | ) | (113,318 | ) | |||||||
Ending balances | $ | 51,520 | $ | 80,277 | $ | 51,520 | $ | 80,277 |
July 1, 2017 | December 31, 2016 | ||||||
Components | $ | 5,270 | $ | 1,035 | |||
Finished goods | 136,234 | 229,352 | |||||
Total inventories | $ | 141,504 | $ | 230,387 |
July 1, 2017 | December 31, 2016 | ||||||
Prepaid income taxes | $ | 65,442 | $ | 481 | |||
POP displays, net | 5,436 | 22,804 | |||||
Prepaid marketing | 3,251 | 5,764 | |||||
Derivative assets | 361 | 10,625 | |||||
Other | 23,227 | 26,672 | |||||
Total prepaid expenses and other current assets | $ | 97,717 | $ | 66,346 |
July 1, 2017 | December 31, 2016 | ||||||
Tooling and manufacturing equipment | $ | 50,736 | $ | 60,944 | |||
Furniture and office equipment | 16,416 | 14,424 | |||||
Purchased and internally-developed software | 14,648 | 12,032 | |||||
Leasehold improvements | 37,107 | 28,489 | |||||
Total property and equipment | 118,907 | 115,889 | |||||
Less: Accumulated depreciation and amortization | (38,772 | ) | (39,336 | ) | |||
Property and equipment, net | $ | 80,135 | $ | 76,553 |
July 1, 2017 | December 31, 2016 | Weighted Average Remaining Useful Life (years) | |||||||||||||||||||||||
Gross | Accumulated Amortization | Net | Gross | Accumulated Amortization | Net | ||||||||||||||||||||
Developed technology | $ | 26,092 | $ | (5,885 | ) | $ | 20,207 | $ | 26,092 | $ | (3,247 | ) | $ | 22,845 | 4.2 | ||||||||||
Trademarks and other | 1,150 | (529 | ) | 621 | 1,278 | (542 | ) | 736 | 2.8 | ||||||||||||||||
Total finite-lived intangible assets subject to amortization, net | 27,242 | (6,414 | ) | 20,828 | 27,370 | (3,789 | ) | 23,581 | |||||||||||||||||
In-process research and development | 3,940 | — | 3,940 | 3,940 | — | 3,940 | |||||||||||||||||||
Total intangible assets, net | $ | 31,182 | $ | (6,414 | ) | $ | 24,768 | $ | 31,310 | $ | (3,789 | ) | $ | 27,521 |
Cost of Revenue | Operating Expenses | Total | |||||||||
Remaining 2017 | $ | 2,638 | $ | 115 | $ | 2,753 | |||||
2018 | 5,276 | 230 | 5,506 | ||||||||
2019 | 4,496 | 230 | 4,726 | ||||||||
2020 | 3,716 | 46 | 3,762 | ||||||||
2021 | 3,716 | — | 3,716 | ||||||||
Thereafter | 365 | — | 365 | ||||||||
Total finite-lived intangible assets, net | $ | 20,207 | $ | 621 | $ | 20,828 |
July 1, 2017 | December 31, 2016 | ||||||
Product warranty | $ | 72,761 | $ | 99,923 | |||
Accrued manufacturing expense and freight | 60,826 | 75,579 | |||||
Accrued sales incentives | 64,281 | 74,181 | |||||
Accrued sales and marketing | 24,495 | 41,948 | |||||
Accrued co-op advertising and marketing development funds | 17,992 | 40,002 | |||||
Sales taxes and VAT payable | 20,263 | 8,891 | |||||
Employee related liabilities | 19,716 | 13,934 | |||||
Inventory received but not billed | 13,981 | 7,363 | |||||
Accrued legal fees | 10,336 | 3,963 | |||||
Derivative liabilities | 13,869 | 3,780 | |||||
Other | 28,997 | 20,997 | |||||
Accrued liabilities | $ | 347,517 | $ | 390,561 |
Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
Beginning balances | $ | 90,459 | $ | 50,669 | $ | 99,923 | $ | 40,212 | |||||||
Charged to cost of revenue | (1,595 | ) | 64,211 | 17,342 | 101,452 | ||||||||||
Changes related to pre-existing warranties | 4,913 | (487 | ) | 2,473 | (487 | ) | |||||||||
Settlement of claims | (21,016 | ) | (37,552 | ) | (46,977 | ) | (64,336 | ) | |||||||
Ending balances | $ | 72,761 | $ | 76,841 | $ | 72,761 | $ | 76,841 |
(1) | Does not include reserves established as a result of the recall of the Fitbit Force. See the section titled “—Fitbit Force Recall Reserve” in the Company’s Annual Report on Form 10-K for additional information regarding such reserves. |
Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
Beginning balance | $ | 2,352 | $ | — | $ | — | $ | — | |||||||
Restructuring charges | — | — | 6,375 | — | |||||||||||
Cash paid | (1,330 | ) | — | (4,625 | ) | — | |||||||||
Other - noncash | — | — | (728 | ) | — | ||||||||||
Ending balance | $ | 1,022 | $ | — | $ | 1,022 | $ | — |
Unrealized Gains (Losses) on Cash Flow Hedges | Currency Translation Adjustments | Unrealized Gains (Losses) on Available-for-Sale Investments | Total | ||||||||||||
Balance at December 31, 2016 | $ | (477 | ) | $ | (314 | ) | $ | (187 | ) | $ | (978 | ) | |||
Other comprehensive income (loss) before reclassifications | (13,789 | ) | 314 | 85 | (13,390 | ) | |||||||||
Amounts reclassified from AOCI | 1,647 | — | (12 | ) | 1,635 | ||||||||||
Other comprehensive income (loss) | (12,142 | ) | 314 | 73 | (11,755 | ) | |||||||||
Balance at July 1, 2017 | $ | (12,619 | ) | $ | — | $ | (114 | ) | $ | (12,733 | ) |
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Stock Options Outstanding | ||||||||||
Number of Shares Subject to Stock Options | Weighted– Average Exercise Price | Aggregate Intrinsic Value (1) | ||||||||
(in thousands) | (in thousands) | |||||||||
Balance—December 31, 2016 | 34,454 | $ | 3.85 | |||||||
Granted | — | |||||||||
Exercised | (3,850 | ) | $ | 1.32 | ||||||
Forfeited or canceled | (2,562 | ) | $ | 7.26 | ||||||
Balance—July 1, 2017 | 28,042 | $ | 3.88 | $ | 85,564 | |||||
Stock options exercisable—July 1, 2017 | 20,405 | $ | 3.08 | $ | 72,752 | |||||
Stock options vested and expected to vest—July 1, 2017 | 27,831 | $ | 3.87 | $ | 85,240 |
RSUs Outstanding | Weighted- Average Grant Date Fair Value | |||||
(in thousands) | ||||||
Unvested balance—December 31, 2016 | 11,578 | $ | 16.85 | |||
Granted | 9,929 | 5.75 | ||||
Vested | (2,354 | ) | 15.69 | |||
Forfeited or canceled | (2,712 | ) | 13.86 | |||
Unvested balance—July 1, 2017 | 16,441 | 10.81 |
Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
Cost of revenue | $ | 1,492 | $ | 1,084 | $ | 1,510 | $ | 2,393 | |||||||
Research and development | 12,648 | 11,725 | 27,333 | 22,118 | |||||||||||
Sales and marketing | 3,987 | 2,927 | 7,622 | 5,462 | |||||||||||
General and administrative | 3,839 | 4,664 | 7,994 | 8,197 | |||||||||||
Total stock-based compensation expense | $ | 21,966 | $ | 20,400 | $ | 44,459 | $ | 38,170 |
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Three Months Ended | Six Months Ended | ||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||
A | 11 | % | 16 | % | 11 | % | 17 | % | |||
B | * | 14 | * | 12 | |||||||
C | 14 | 14 | 12 | 13 |
July 1, 2017 | December 31, 2016 | ||||
C | 19 | % | 19 | % | |
A | 19 | 16 | |||
D | * | 12 | |||
B | 12 | * |
Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
United States | $ | 199,201 | $ | 445,192 | $ | 369,621 | $ | 796,877 | |||||||
Americas excluding United States | 24,412 | 27,375 | 44,380 | 50,769 | |||||||||||
Europe, Middle East, and Africa | 108,601 | 99,471 | 196,373 | 174,195 | |||||||||||
APAC | 21,085 | 14,490 | 41,867 | 70,043 | |||||||||||
Total | $ | 353,299 | $ | 586,528 | $ | 652,241 | $ | 1,091,884 |
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July 1, 2017 | |||||||||||
Level 1 | Level 2 | Total | |||||||||
Assets: | |||||||||||
Money market funds | $ | 161,762 | $ | — | $ | 161,762 | |||||
U.S. government agencies | — | 39,961 | 39,961 | ||||||||
Corporate debt securities | — | 353,046 | 353,046 | ||||||||
Derivative assets | — | 361 | 361 | ||||||||
Total | $ | 161,762 | $ | 393,368 | $ | 555,130 | |||||
Liabilities: | |||||||||||
Derivative liabilities | $ | — | $ | 13,869 | $ | 13,869 |
December 31, 2016 | |||||||||||
Level 1 | Level 2 | 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 |
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July 1, 2017 | December 31, 2016 | ||||||
Due in one year | $ | 340,293 | $ | 355,152 | |||
Due in one to two years | 16,797 | 49,541 | |||||
Total | $ | 357,090 | $ | 404,693 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Cash and Cash Equivalents | Marketable Securities | ||||||||||||||||||
Cash | $ | 121,029 | $ | — | $ | — | $ | 121,029 | $ | 121,029 | $ | — | |||||||||||
Money market funds | 161,762 | — | — | 161,762 | 161,762 | — | |||||||||||||||||
U.S. government agencies | 39,974 | 1 | (14 | ) | 39,961 | 21,926 | 18,035 | ||||||||||||||||
Corporate debt securities | 353,108 | 64 | (126 | ) | 353,046 | 13,991 | 339,055 | ||||||||||||||||
Total | $ | 675,873 | $ | 65 | $ | (140 | ) | $ | 675,798 | $ | 318,708 | $ | 357,090 |
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 |
July 1, 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 expenses and other current assets | $ | — | $ | — | $ | 813 | $ | — | ||||||||
Cash flow designated hedges | Accrued liabilities | — | 12,081 | — | 1,428 | ||||||||||||
Hedges not designated | Prepaid expenses and other current assets | 361 | — | 9,812 | — | ||||||||||||
Hedges not designated | Accrued liabilities | — | 1,788 | — | 2,352 | ||||||||||||
Total fair value of derivative instruments | $ | 361 | $ | 13,869 | $ | 10,625 | $ | 3,780 |
Three Months Ended | Six Months Ended | ||||||||||||||||
Income Statement Location | July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | |||||||||||||
Foreign exchange cash flow hedges: | |||||||||||||||||
Gain (loss) recognized in OCI – effective portion | $ | (13,029 | ) | $ | 5,783 | $ | (13,987 | ) | $ | 1,535 | |||||||
Loss reclassified from OCI into income – effective portion | Revenue | (1,035 | ) | (1,380 | ) | (280 | ) | (1,550 | ) | ||||||||
Gain (loss) reclassified from OCI into income – effective portion | Operating expenses | (440 | ) | 1,393 | (1,405 | ) | 2,408 | ||||||||||
Gain (loss) recognized in income – ineffective portion | Other income (expense), net | — | (95 | ) | 21 | (185 | ) | ||||||||||
Gain recognized in income – excluded time value portion | Other income (expense), net | 660 | — | 843 | — | ||||||||||||
Foreign exchange balance sheet hedges: | |||||||||||||||||
Loss recognized in income | Other income (expense), net | (3,547 | ) | (72 | ) | (6,776 | ) | (209 | ) |
Three Months Ended | Six Months Ended | ||||||||||||||||
Income Statement Location | July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | |||||||||||||
Foreign exchange cash flow hedges: | |||||||||||||||||
Gain (loss) recognized in OCI – effective portion | $ | (13,029 | ) | $ | 5,783 | $ | (13,987 | ) | $ | 1,535 | |||||||
Loss reclassified from OCI into income – effective portion | Revenue | (1,035 | ) | (1,380 | ) | (280 | ) | (1,550 | ) | ||||||||
Gain (loss) reclassified from OCI into income – effective portion | Operating expenses | (440 | ) | 1,393 | (1,405 | ) | 2,408 | ||||||||||
Gain (loss) recognized in income – ineffective portion | Other income (expense), net | — | (95 | ) | 21 | (185 | ) | ||||||||||
Gain recognized in income – excluded time value portion | Other income (expense), net | 660 | — | 843 | — | ||||||||||||
Foreign exchange balance sheet hedges: | |||||||||||||||||
Loss recognized in income | Other income (expense), net | (3,547 | ) | (72 | ) | (6,776 | ) | (209 | ) |
Gross Amounts Offset in the Condensed Consolidated Balance Sheets | Gross Amounts Not Offset in Condensed Consolidated Balance Sheets | ||||||||||||||||||||||
July 1, 2017 | Gross Amounts Recognized | Gross Amounts Offset | Net Amounts Presented | Financial Instruments | Cash Collateral Received | Net Amount | |||||||||||||||||
Foreign exchange contracts assets | $ | 361 | $ | — | $ | 361 | $ | 361 | $ | — | $ | — | |||||||||||
Foreign exchange contracts liabilities | $ | 13,869 | $ | — | $ | 13,869 | $ | 361 | $ | — | $ | 13,508 | |||||||||||
Gross Amounts Offset in the Condensed Consolidated Balance Sheets | Gross Amounts Not Offset in Condensed Consolidated Balance Sheets | ||||||||||||||||||||||
December 31, 2016 | Gross Amounts Recognized | Gross Amounts Offset | Net Amounts 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 | $ | — | $ | — |
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Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
Beginning balances | $ | 68,317 | $ | 55,875 | $ | 98,851 | $ | 74,045 | |||||||
Increases | 48,285 | 85,335 | 89,911 | 119,550 | |||||||||||
Returns taken | (65,082 | ) | (60,933 | ) | (137,242 | ) | (113,318 | ) | |||||||
Ending balances | $ | 51,520 | $ | 80,277 | $ | 51,520 | $ | 80,277 |
July 1, 2017 | December 31, 2016 | ||||||
Components | $ | 5,270 | $ | 1,035 | |||
Finished goods | 136,234 | 229,352 | |||||
Total inventories | $ | 141,504 | $ | 230,387 |
July 1, 2017 | December 31, 2016 | ||||||
Prepaid income taxes | $ | 65,442 | $ | 481 | |||
POP displays, net | 5,436 | 22,804 | |||||
Prepaid marketing | 3,251 | 5,764 | |||||
Derivative assets | 361 | 10,625 | |||||
Other | 23,227 | 26,672 | |||||
Total prepaid expenses and other current assets | $ | 97,717 | $ | 66,346 |
July 1, 2017 | December 31, 2016 | ||||||
Tooling and manufacturing equipment | $ | 50,736 | $ | 60,944 | |||
Furniture and office equipment | 16,416 | 14,424 | |||||
Purchased and internally-developed software | 14,648 | 12,032 | |||||
Leasehold improvements | 37,107 | 28,489 | |||||
Total property and equipment | 118,907 | 115,889 | |||||
Less: Accumulated depreciation and amortization | (38,772 | ) | (39,336 | ) | |||
Property and equipment, net | $ | 80,135 | $ | 76,553 |
July 1, 2017 | December 31, 2016 | Weighted Average Remaining Useful Life (years) | |||||||||||||||||||||||
Gross | Accumulated Amortization | Net | Gross | Accumulated Amortization | Net | ||||||||||||||||||||
Developed technology | $ | 26,092 | $ | (5,885 | ) | $ | 20,207 | $ | 26,092 | $ | (3,247 | ) | $ | 22,845 | 4.2 | ||||||||||
Trademarks and other | 1,150 | (529 | ) | 621 | 1,278 | (542 | ) | 736 | 2.8 | ||||||||||||||||
Total finite-lived intangible assets subject to amortization, net | 27,242 | (6,414 | ) | 20,828 | 27,370 | (3,789 | ) | 23,581 | |||||||||||||||||
In-process research and development | 3,940 | — | 3,940 | 3,940 | — | 3,940 | |||||||||||||||||||
Total intangible assets, net | $ | 31,182 | $ | (6,414 | ) | $ | 24,768 | $ | 31,310 | $ | (3,789 | ) | $ | 27,521 |
Cost of Revenue | Operating Expenses | Total | |||||||||
Remaining 2017 | $ | 2,638 | $ | 115 | $ | 2,753 | |||||
2018 | 5,276 | 230 | 5,506 | ||||||||
2019 | 4,496 | 230 | 4,726 | ||||||||
2020 | 3,716 | 46 | 3,762 | ||||||||
2021 | 3,716 | — | 3,716 | ||||||||
Thereafter | 365 | — | 365 | ||||||||
Total finite-lived intangible assets, net | $ | 20,207 | $ | 621 | $ | 20,828 |
July 1, 2017 | December 31, 2016 | ||||||
Product warranty | $ | 72,761 | $ | 99,923 | |||
Accrued manufacturing expense and freight | 60,826 | 75,579 | |||||
Accrued sales incentives | 64,281 | 74,181 | |||||
Accrued sales and marketing | 24,495 | 41,948 | |||||
Accrued co-op advertising and marketing development funds | 17,992 | 40,002 | |||||
Sales taxes and VAT payable | 20,263 | 8,891 | |||||
Employee related liabilities | 19,716 | 13,934 | |||||
Inventory received but not billed | 13,981 | 7,363 | |||||
Accrued legal fees | 10,336 | 3,963 | |||||
Derivative liabilities | 13,869 | 3,780 | |||||
Other | 28,997 | 20,997 | |||||
Accrued liabilities | $ | 347,517 | $ | 390,561 |
Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
Beginning balances | $ | 90,459 | $ | 50,669 | $ | 99,923 | $ | 40,212 | |||||||
Charged to cost of revenue | (1,595 | ) | 64,211 | 17,342 | 101,452 | ||||||||||
Changes related to pre-existing warranties | 4,913 | (487 | ) | 2,473 | (487 | ) | |||||||||
Settlement of claims | (21,016 | ) | (37,552 | ) | (46,977 | ) | (64,336 | ) | |||||||
Ending balances | $ | 72,761 | $ | 76,841 | $ | 72,761 | $ | 76,841 |
(1) | Does not include reserves established as a result of the recall of the Fitbit Force. See the section titled “—Fitbit Force Recall Reserve” in the Company’s Annual Report on Form 10-K for additional information regarding such reserves. |
Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
Beginning balance | $ | 2,352 | $ | — | $ | — | $ | — | |||||||
Restructuring charges | — | — | 6,375 | — | |||||||||||
Cash paid | (1,330 | ) | — | (4,625 | ) | — | |||||||||
Other - noncash | — | — | (728 | ) | — | ||||||||||
Ending balance | $ | 1,022 | $ | — | $ | 1,022 | $ | — |
Unrealized Gains (Losses) on Cash Flow Hedges | Currency Translation Adjustments | Unrealized Gains (Losses) on Available-for-Sale Investments | Total | ||||||||||||
Balance at December 31, 2016 | $ | (477 | ) | $ | (314 | ) | $ | (187 | ) | $ | (978 | ) | |||
Other comprehensive income (loss) before reclassifications | (13,789 | ) | 314 | 85 | (13,390 | ) | |||||||||
Amounts reclassified from AOCI | 1,647 | — | (12 | ) | 1,635 | ||||||||||
Other comprehensive income (loss) | (12,142 | ) | 314 | 73 | (11,755 | ) | |||||||||
Balance at July 1, 2017 | $ | (12,619 | ) | $ | — | $ | (114 | ) | $ | (12,733 | ) |
|
Stock Options Outstanding | ||||||||||
Number of Shares Subject to Stock Options | Weighted– Average Exercise Price | Aggregate Intrinsic Value (1) | ||||||||
(in thousands) | (in thousands) | |||||||||
Balance—December 31, 2016 | 34,454 | $ | 3.85 | |||||||
Granted | — | |||||||||
Exercised | (3,850 | ) | $ | 1.32 | ||||||
Forfeited or canceled | (2,562 | ) | $ | 7.26 | ||||||
Balance—July 1, 2017 | 28,042 | $ | 3.88 | $ | 85,564 | |||||
Stock options exercisable—July 1, 2017 | 20,405 | $ | 3.08 | $ | 72,752 | |||||
Stock options vested and expected to vest—July 1, 2017 | 27,831 | $ | 3.87 | $ | 85,240 |
RSUs Outstanding | Weighted- Average Grant Date Fair Value | |||||
(in thousands) | ||||||
Unvested balance—December 31, 2016 | 11,578 | $ | 16.85 | |||
Granted | 9,929 | 5.75 | ||||
Vested | (2,354 | ) | 15.69 | |||
Forfeited or canceled | (2,712 | ) | 13.86 | |||
Unvested balance—July 1, 2017 | 16,441 | 10.81 |
Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
Cost of revenue | $ | 1,492 | $ | 1,084 | $ | 1,510 | $ | 2,393 | |||||||
Research and development | 12,648 | 11,725 | 27,333 | 22,118 | |||||||||||
Sales and marketing | 3,987 | 2,927 | 7,622 | 5,462 | |||||||||||
General and administrative | 3,839 | 4,664 | 7,994 | 8,197 | |||||||||||
Total stock-based compensation expense | $ | 21,966 | $ | 20,400 | $ | 44,459 | $ | 38,170 |
|
Three Months Ended | Six Months Ended | ||||||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||||||
United States | $ | 199,201 | $ | 445,192 | $ | 369,621 | $ | 796,877 | |||||||
Americas excluding United States | 24,412 | 27,375 | 44,380 | 50,769 | |||||||||||
Europe, Middle East, and Africa | 108,601 | 99,471 | 196,373 | 174,195 | |||||||||||
APAC | 21,085 | 14,490 | 41,867 | 70,043 | |||||||||||
Total | $ | 353,299 | $ | 586,528 | $ | 652,241 | $ | 1,091,884 |
Three Months Ended | Six Months Ended | ||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||
A | 11 | % | 16 | % | 11 | % | 17 | % | |||
B | * | 14 | * | 12 | |||||||
C | 14 | 14 | 12 | 13 |
Three Months Ended | Six Months Ended | ||||||||||
July 1, 2017 | July 2, 2016 | July 1, 2017 | July 2, 2016 | ||||||||
A | 11 | % | 16 | % | 11 | % | 17 | % | |||
B | * | 14 | * | 12 | |||||||
C | 14 | 14 | 12 | 13 |
July 1, 2017 | December 31, 2016 | ||||
C | 19 | % | 19 | % | |
A | 19 | 16 | |||
D | * | 12 | |||
B | 12 | * |
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