Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Dec. 31, 2019 |
Jun. 30, 2019 |
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Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 2,946 | $ 2,946 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common Stock, Shares, Issued | 35,001,581 | 34,437,339 |
Common stock, shares outstanding (in shares) | 35,001,581 | 34,437,339 |
Consolidated Statements of Comprehensive (Loss) Income - USD ($) $ in Thousands |
12 Months Ended | ||
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Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
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Statement of Comprehensive Income [Abstract] | |||
Consolidated net income (loss) | $ 47,004 | $ 2,910 | $ 4,657 |
Other comprehensive (loss) income, net of tax: | |||
Foreign currency translation adjustments, net of tax | (1,120) | (3,246) | 6,387 |
Net change in unrealized gains (losses) on available-for-sale securities, net of tax | 738 | (265) | (130) |
Total other comprehensive income (loss), net of tax | (382) | (3,511) | 6,257 |
Consolidated comprehensive (loss) income | 46,622 | (601) | 10,914 |
Net loss attributable to non-controlling interest | (1,454) | (3,691) | 0 |
Comprehensive income attributable to Penumbra, Inc. | $ 48,076 | $ 3,090 | $ 10,914 |
Organization and Description of Business |
12 Months Ended |
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Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | 1. Organization and Description of Business Penumbra, Inc. (the “Company”) is a global healthcare company focused on innovative therapies. The Company designs, develops, manufactures and markets medical devices and has a broad portfolio of products that addresses challenging medical conditions and significant clinical needs.
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Summary of Significant Accounting Policies |
12 Months Ended |
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Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation and Consolidation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). Certain changes in presentation were made in the consolidated financial statements for the year ended December 31, 2018 and 2017, to conform to the presentation for the year ended December 31, 2019. The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and its majority-owned subsidiary. The portion of equity not attributable to the Company is considered non-controlling interest and is classified separately in the consolidated financial statements. Any subsequent changes in the Company’s ownership interest while the Company retains its controlling interest in its majority-owned subsidiary will be accounted for as equity transactions. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and equity accounts; disclosure of contingent assets and liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including those related to marketable investments, provisions for doubtful accounts, the amount of variable consideration included in the transaction price, warranty reserve, valuation of inventories, useful lives of property and equipment, operating and finance lease right-of-use (“ROU”) assets and liabilities, income taxes, contingent consideration and other contingencies, among others. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other data. Actual results could differ from those estimates. Segments The Company determined its operating segment on the same basis that it uses to evaluate its performance internally. The Company has one business activity: the design, development, manufacturing and marketing of innovative medical devices, and operates as one operating segment. The Company’s chief operating decision-maker (“CODM”), its Chief Executive Officer, reviews its consolidated operating results for the purpose of allocating resources and evaluating financial performance. The Company’s entity-wide disclosures are included in Note “16. Revenues.” Foreign Currency Translation The Company’s consolidated financial statements are prepared in United States Dollars (“USD”). Its foreign subsidiaries use their local currency as their functional currency and maintain their records in the local currency. Accordingly, the assets and liabilities of these subsidiaries are translated into USD using the current exchange rates in effect at the balance sheet date and equity accounts are translated into USD using historical rates. Revenues and expenses are translated using the average exchange rates in effect for the year involved. The resulting foreign currency translation adjustments are recorded in accumulated other comprehensive loss in the consolidated balance sheets. Transactions denominated in currencies other than the respective functional currencies are translated at exchange rates as of the date of transaction with foreign currency gains and losses recorded in other expense, net in the consolidated statements of operations. The Company realized net foreign currency transaction losses of $0.8 million, $0.9 million and $1.0 million during the years ended December 31, 2019, 2018 and 2017, respectively. As the Company’s international operations grow, its risks associated with fluctuation in currency rates will become greater, and the Company will continue to reassess its approach to managing this risk. In addition, currency fluctuations or a weakening USD can increase the costs of the Company’s international expansion. To date, the Company has not entered into any foreign currency hedging contracts. Concentration of Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents, marketable investments (as described in greater detail in this footnote under the header “Cash, Cash Equivalents and Marketable Investments” below) and accounts receivable. The majority of the Company’s cash is held by one financial institution in the U. S. in excess of federally insured limits. The Company maintained investments in money market funds that were not federally insured during the year ended December 31, 2019 and held cash in foreign entities of approximately $17.3 million and $23.4 million at December 31, 2019 and 2018, respectively, which was not federally insured. The Company’s revenue has been derived from sales of its products in the United States and international markets. The Company uses both its own salesforce and independent distributors to sell its products. Concentrations of credit risk with respect to accounts receivable are limited due to the large number of entities comprising the Company’s customer base. The Company performs ongoing credit evaluations of its customers, including its distributors, does not require collateral, and maintains allowances for potential credit losses on customer accounts when deemed necessary. During the year ended December 31, 2019 and 2018, no customer accounted for greater than 10% of the Company’s revenue. During December 31, 2017, one customer, a distributor, accounted for 10.1% of the Company’s revenue. One customer accounted for greater than 10% of the Company’s accounts receivable balance as of December 31, 2019. No customers accounted for greater than 10% of the Company’s accounts receivable balance as of December 31, 2018. Significant Risks and Uncertainties The Company is subject to risks common to medical device companies including, but not limited to, new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, product liability, uncertainty of market acceptance of products and the potential need to obtain additional financing. The Company is dependent on third party suppliers, in some cases single-source suppliers. There can be no assurance that the Company’s products will continue to be accepted in the marketplace, nor can there be any assurance that any future products can be developed or manufactured at an acceptable cost and with appropriate performance characteristics, or that such products will be successfully marketed, if at all. The Company’s products require approval or clearance from the FDA prior to commencing commercial sales in the United States. There can be no assurance that the Company’s products will receive all of the required approvals or clearances. Approvals or clearances are also required in foreign jurisdictions in which the Company sells its products. If the Company is denied such approvals or clearances or such approvals or clearances are delayed, it may have a material adverse impact on the Company’s results of operations, financial position and liquidity. Fair Value of Financial Instruments Carrying amounts of certain of the Company’s financial instruments, including cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued liabilities, approximate fair value due to their relatively short maturities. Cash, Cash Equivalents and Marketable Investments The Company invests its cash primarily in highly liquid corporate debt securities, debt instruments of U.S. federal, state and municipal governments, and their agencies, in money market funds and in commercial paper. All highly liquid investments with stated maturities of three months or less from the date of purchase are classified as cash equivalents; all highly liquid investments with stated maturities of greater than three months are classified as marketable investments. The majority of the Company’s cash and investments are held in U.S. banks. The Company determines the appropriate classification of its investments in marketable investments at the time of purchase and re-evaluates such designation at each balance sheet date. The Company’s marketable investments have been classified and accounted for as available-for-sale. Investments with remaining maturities of more than one year are viewed by the Company as available to support current operations and are classified as current assets under the caption marketable investments in the accompanying consolidated balance sheets. Investments in marketable investments are carried at fair value, with the unrealized gains and losses reported as a component of accumulated other comprehensive loss. Any realized gains or losses on the sale of marketable investments are determined on a specific identification method, and such gains and losses are reflected as a component of other income (expense), net. Impairment of Marketable Investments After determining the fair value of available-for-sale debt instruments, unrealized gains or losses on these securities are recorded to accumulated other comprehensive loss until either the security is sold or the Company determines that the decline in value is other-than-temporary. The primary differentiating factors that the Company considers in classifying impairments as either temporary or other-than-temporary impairments is the intent and ability to retain the investment in the issuer for a period of time sufficient to allow for any anticipated recovery in market value, the length of the time and the extent to which the market value of the investment has been less than cost, the financial condition, and near-term prospects of the issuer. There were no other-than-temporary impairments for the years ended December 31, 2019, 2018 or 2017. Non-Marketable Equity Investments Entities in which the Company has at least a 20%, but not more than a 50%, interest are accounted for under the equity method unless it is determined that the Company has a controlling financial interest in the entity, in which case the entity would be consolidated. Non-marketable equity investments are classified as long-term investments on the consolidated balance sheet. The Company’s proportionate share of the operating results of its non-marketable equity method investments are recorded as profit or loss and presented in equity in losses of unconsolidated investee, in the consolidated statements of operations. See Note “3. Investments and Fair Value of Financial Instruments” for further details. Accounts Receivable Accounts receivable are stated at invoice value less estimated allowances for doubtful accounts. The Company continually monitors customer payments and maintains a reserve for estimated losses resulting from its customers’ inability to make required payments. The Company considers factors such as historical experience, credit quality, age of the accounts receivable balances, geographic related risks and economic conditions that may affect a customer’s ability to pay. In cases where there are circumstances that may impair a specific customer’s ability to meet its financial obligations, a specific allowance is recorded against amounts due, and thereby reduces the net recognized receivable to the amount reasonably believed to be collectible. Inventories Inventories are stated at the lower of cost (determined under the first-in first-out method) or net realizable value. Write-downs are provided for raw materials, components or finished goods that are determined to be excessive or obsolete. The Company regularly reviews inventory quantities in consideration of actual loss experience, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. As a result of these evaluations, the Company recognized total write-offs and write-downs of $4.4 million, $1.7 million, and $1.0 million for the years ended December 31, 2019, 2018 and 2017. Property and Equipment, net Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or estimated useful life. Machinery and equipment and furniture and fixtures are depreciated over a to year period and computers and software are depreciated over to years. Upon retirement or sale, the cost and the related accumulated depreciation are removed from the consolidated balance sheet and the resulting gain or loss is reflected in operations. Maintenance and repairs are charged to consolidated statements of operations as incurred. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When such an event occurs, management determines whether there has been impairment by comparing the anticipated undiscounted future net cash flows to the related asset group’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. There was no impairment of long-lived assets during the years ended December 31, 2019, 2018 or 2017. Contingent Consideration Certain agreements the Company enters into, including business combinations, involve the potential payment of future consideration that is contingent upon certain performance and revenue milestones being achieved. Contingent consideration obligations incurred in connection with a business combination are recorded at their fair values on the acquisition date and remeasured at their fair values each subsequent reporting period until the related contingencies are resolved. The resulting changes in fair values are recognized generally within sales, general and administrative expense, depending on the nature of the contingent consideration liability, in the consolidated statements of operations. Asset acquisitions are accounted for using a cost accumulation and allocation model and the cost of the acquisition is allocated to the assets acquired and liabilities assumed. Contingent consideration obligations incurred in connection with an asset acquisition are recorded when it is probable that they will occur and they can be reasonably estimated. As of December 31, 2019 and 2018, the Company’s contingent consideration obligations in connection with business combinations relate to milestone payments for the acquisition of Crossmed S.p.A. (“Crossmed”). For more information with respect to the fair value of contingent consideration, refer to Note “5. Business Combinations.” Intangible Assets Intangible assets primarily consist of purchased rights to licensed technology, customer relationships, and trade secrets and processes. Indefinite-lived intangible assets relate to an exclusive right to licensed technology. The acquired licensed technology is accounted for as an indefinite-lived intangible asset. Upon the commercialization of the underlying product utilizing the licensed technology, the capitalized amount will be amortized over its estimated useful life. Indefinite-lived intangible assets are tested for impairment at least annually, in the fourth quarter, or more frequently if events or circumstances indicate that it is more likely than not that the asset is impaired. If the fair value of the asset is less than the carrying amount, an impairment loss would be recognized in an amount equal to the difference between the carrying amount and the fair value. Refer to Note “7. Intangible Assets” for more information on the Company’s intangible assets. Finite-lived intangible assets are amortized over the estimated economic useful lives of the assets, which is the period during which expected cash flows support the fair value of such intangible assets. The Company reviews finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets or asset group may not be recoverable. When such an event occurs, management determines whether there has been impairment by comparing the anticipated undiscounted future net cash flows to the related asset group’s carrying value. Refer to Note “7. Intangible Assets” for more information on the Company’s intangible assets. Goodwill Goodwill represents the excess of the purchase price of an acquired business or assets over the fair value of the identifiable assets acquired and liabilities assumed. Goodwill is not amortized, but is tested for impairment annually in the fourth quarter, or more frequently if events or circumstances indicate the carrying value may no longer be recoverable and that an impairment loss may have occurred. The Company operates as one segment, which is considered to be the sole reporting unit, and therefore goodwill is tested for impairment at the consolidated level. Refer to Note “5. Business Combinations” and Note “8. Goodwill” for more information. Revenue Recognition Revenue is comprised of product revenue net of returns, discounts, administration fees and sales rebates. The Company adopted the guidance under ASC 606 on January 1, 2018 using the modified retrospective method for all contracts not completed as of the date of adoption. Therefore, the financial information for the year ended December 31, 2017 has not been adjusted and continues to be reported under ASC 605 with the impact of the adoption reflected in opening retained earnings in 2018. Under ASC 606, the Company recognizes revenue when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenue from product sales is recognized either on the date of shipment or the date of receipt by the customer, but is deferred for certain transactions when control has not yet transferred. With respect to products that the Company consigns to hospitals, which primarily consist of coils, the Company recognizes revenue at the time hospitals utilize products in a procedure. Deferred revenue represents amounts that the Company has already invoiced and are ultimately expected to be recognized as revenue, but for which not all revenue recognition criteria have been met. As of December 31, 2019 and December 31, 2018, respectively, the Company's deferred revenue balance was not material. Revenue is recorded at the net sales price, which includes estimates of variable consideration such as product returns utilizing historical return rates, rebates, discounts, and other adjustments to net revenue. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price. Variable consideration is included in revenue only to the extent that it is probable that a significant reversal of the revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The Company’s terms and conditions permit product returns and exchanges. The Company bases its estimates for sales returns on actual historical returns over the prior years and they are recorded as reductions in revenue at the time of sale. Upon recognition, the Company reduces revenue and cost of revenue for the estimated return. Return rates can fluctuate over time, but are sufficiently predictable to allow the Company to estimate expected future product returns. For more information and disclosures on the Company’s revenue, refer to Note “16. Revenues.” Shipping Costs Shipping and handling costs charged to customers are recorded as revenue. Shipping and handling costs are included in cost of revenue. Research and Development (“R&D”) Costs R&D costs primarily consist of product development, clinical and regulatory expenses, materials, depreciation and other costs associated with the development of the Company’s products. R&D costs also include related personnel and consultants’ salaries, benefits and related costs, including stock-based compensation. The Company expenses R&D costs as they are incurred. The Company’s clinical trial accruals are based on estimates of patient enrollment and related costs at clinical investigator sites. The Company estimates preclinical and clinical trial expenses based on the services performed pursuant to contracts with research institutions and clinical research organizations that conduct and manage preclinical studies and clinical trials on its behalf. In accruing service fees, the Company estimates the time period over which services will be performed and the level of patient enrollment and activity expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses until the services are rendered. Internal Use Software The Company capitalizes certain costs incurred for the development of computer software for internal use. These costs generally relate to third-party software as well as the internal development of software associated with our REAL Immersive System offerings. The Company capitalizes these costs when it is determined that it is probable that the project will be completed and the software will be used to perform the function intended, and the preliminary project stage is completed. Capitalized internal use software development costs are included in property and equipment, net within the consolidated balance sheets. Capitalized internal use software is amortized on a straight-line basis over its estimated useful life. For software that supports our REAL Immersive System, the amortization expense is recorded in cost of revenue within the consolidated statements of operations. Costs related to the preliminary project stage, post-implementation, training and maintenance are expensed as incurred. Advertising Costs Advertising costs are included in sales, general and administrative expenses and are expensed as incurred. Advertising costs were $0.5 million, $0.5 million and $0.7 million for the years ended December 31, 2019, 2018 and 2017, respectively. Stock-Based Compensation The Company recognizes the cost of stock-based compensation in the financial statements based upon fair value. The fair value of restricted stock and restricted stock unit (“RSU”) awards is determined based on the number of units granted and the closing price of the Company’s common stock as of the grant date. The fair value of each purchase under the employee stock purchase plan (“ESPP”) is estimated at the beginning of the offering period using the Black-Scholes option pricing model. The fair value of stock options is determined as of the grant date using the Black-Scholes option pricing model. The Company’s determination of the fair value of equity-settled awards is impacted by the price of the Company’s common stock as well as changes in assumptions regarding a number of complex and subjective variables. These variables include, but are not limited to, the expected term that awards will remain outstanding, expected common stock price volatility over the term of the awards, risk-free interest rates and expected dividends. The fair value of an award is recognized over the requisite service period (usually the vesting period) on a straight-line basis. Stock-based compensation expense recognized at fair value includes the impact of estimated forfeitures. The Company estimates future forfeitures at the date of grant and revises the estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. To the extent actual forfeiture results differ from the estimates, the difference is recorded as a cumulative adjustment in the period forfeiture estimates are revised. No compensation cost is recorded for awards that do not vest. Prior to the adoption of Accounting Standard Update (“ASU”) No. 2018-07, “Compensation – Stock Compensation,” the Company recorded its equity instruments issued to non-employees at their fair value on the measurement date and were subject to periodic adjustments as the Company remeasured the fair value of the non-employee awards at each reporting period prior to vesting and at the vesting dates of each non-employee award. In the third quarter of 2018, the Company adopted ASU 2018-07 and recognizes the fair value of non-employee awards over the requisite service period (usually the vesting period) on a straight-line basis. Therefore, equity instruments issued to non-employees are recorded at their fair value on the grant date in the same manner as employee awards. The fair value of these equity instruments is expensed over the service period. Estimates of the fair value of equity-settled awards as of the grant date using valuation models, such as the Black-Scholes option pricing model, are affected by assumptions regarding a number of complex variables. Changes in the assumptions can materially affect the fair value of the award and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require significant analysis and judgment to develop. For all stock options granted prior to the Company’s IPO, the Company estimated the volatility data based on a study of publicly traded industry peer companies. For purposes of identifying these peer companies, the Company considered the industry, stage of development, size and financial leverage of potential comparable companies. The risk-free interest rate is based on the yield available on U.S. Treasury zero-coupon issues similar in duration to the expected term of the equity-settled award. For all stock options granted prior to the IPO, the Company used the Staff Accounting Bulletin, No. 110 (“SAB 110”) simplified method to calculate the expected term, which is the average of the contractual term and vesting period. For stock options granted post-IPO, the Company used its historical data to calculate the expected term and volatility used in the valuation of options. Income Taxes The Company accounts for income taxes using the asset and liability method, whereby deferred tax asset (“DTA”) and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities, and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance to reduce the net DTAs to their estimated realizable value. The calculation of the Company’s current provision for income taxes involves the use of estimates, assumptions and judgments while taking into account current tax laws, interpretation of current tax laws and possible outcomes of future tax audits. The Company has established reserves to address potential exposures related to tax positions that could be challenged by tax authorities. Although the Company believes its estimates, assumptions and judgments to be reasonable, any changes in tax law or its interpretation of tax laws and the resolutions of potential tax audits could significantly impact the amounts provided for income taxes in the Company’s consolidated financial statements. The calculation of the Company’s DTA balance involves the use of estimates, assumptions and judgments while taking into account estimates of the amounts and type of future taxable income. Actual future operating results and the underlying amount and type of income could differ materially from the Company’s estimates, assumptions and judgments thereby impacting the Company’s financial position and results of operations. The Company follows the guidance relating to accounting for uncertainty in income taxes, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in the Company’s income tax return, and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure. The Company includes interest and penalties related to unrecognized tax benefits within income tax expense in the accompanying consolidated statements of operations. Comprehensive Income Comprehensive income consists of net income, unrealized gains or losses on available-for-sale investments and the effects of foreign currency translation adjustments. The Company presents comprehensive income and its components in the consolidated statements of comprehensive (loss) income. Net Income (Loss) Per Share of Common Stock The Company’s basic net income (loss) attributable to Penumbra, Inc. per share is calculated by dividing the net income attributable to Penumbra, Inc. per share by the weighted average number of shares of common stock outstanding for the period. The diluted net income (loss) per share attributable to Penumbra, Inc. is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of this calculation, options to purchase common stock, restricted stock and restricted stock units are considered common stock equivalents. Leases The Company adopted the guidance under ASC Topic 842, “Leases” ("ASC 842") on January 1, 2019 using the modified retrospective transition approach. There was no cumulative-effect adjustment recorded to retained earnings upon adoption. Under ASC 842, the Company determines if an arrangement is a lease at inception. In addition, the Company determines whether leases meet the classification criteria of a finance or operating lease at the lease commencement date considering: (1) whether the lease transfers ownership of the underlying asset to the lessee at the end of the lease term, (2) whether the lease contains a bargain purchase option, (3) whether the lease term is for a major part of the remaining economic life of the underlying asset, (4) whether the present value of the sum of the lease payments and residual value guaranteed by the lessee equals or exceeds substantially all of the fair value of the underlying asset, and (5) whether the underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term. As of December 31, 2019, the Company's lease population consisted of operating and finance real estate, equipment and vehicle leases. As of the date of adoption of ASC 842 the Company did not have material finance leases. Operating leases are included in operating lease right-of-use assets, current operating lease liabilities, and non-current operating lease liabilities in our consolidated balance sheet. Finance leases are included in finance lease right-of-use assets, current finance lease liabilities, and non-current finance lease liabilities in our consolidated balance sheet. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, the Company uses its incremental borrowing rate which requires management’s judgement as the rate implicit in the lease is generally not readily determinable. The determination of the Company’s incremental borrowing rate requires management judgment including, the development of a synthetic credit rating and cost of debt as the Company currently does not carry any debt. The operating lease ROU assets also include adjustments for prepayments, accrued lease payments and exclude lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. Operating lease cost is recognized on a straight-line basis over the expected lease term. Finance lease cost is recognized as depreciation expense on a straight-line basis over the expected lease term and interest expense using the accelerated interest method of recognition. Lease agreements entered into after the adoption of ASC 842 that include lease and non-lease components are accounted for as a single lease component. Lease agreements with a non-cancelable term of less than 12 months are not recorded on the Company’s consolidated balance sheet. For more information about the impact of adoption and disclosures on the Company’s leases, refer to Note “9. Leases." Recent Accounting Guidance Recently Adopted Accounting Standards On January 1, 2019, the Company adopted Accounting Standard Update (“ASU”) No. 2016-02, Leases (Topic 842), and its associated amendments using the modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application and not restating comparative periods. There was no cumulative-effect adjustment recorded to retained earnings upon adoption. Under the standard, a lessee is required to recognize a lease liability and ROU asset for all leases. The new guidance also modified the classification criteria and requires additional disclosures to enable users of financial statements to understand the amount, timing, and uncertainty of cash flows arising from leases. Consistent with current guidance, a lessee’s recognition, measurement, and presentation of expenses and cash flows arising from a lease continues to depend primarily on its classification. The Company elected the package of practical expedients permitted under the transition guidance, which allowed the Company to carryforward its historical lease classification, its assessment on whether a contract was or contains a lease, and its initial direct costs for any leases that existed prior to January 1, 2019. In addition, the Company elected the following transitional practical expedients: (1) the short-term lease exception and (2) to not separate its non-lease components for its real estate, vehicle and equipment leases. The impact of adoption and additional disclosures required by the ASU have been included in “Significant Accounting Policies - Leases” below and in Note “9. Leases.” Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-13, Financial Instruments—Credit Losses. The standard changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. In April 2019, the FASB issued ASU No. 2019-04 which provides additional clarification and addresses stakeholders’ specific issues about certain aspects of the amendments in the previously issued ASU No. 2016-13. In May 2019, the FASB issued ASU No. 2019-05 which further amends ASU No. 2016-13 by providing an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis. In November 2019, the FASB issued ASU No. 2019-11 which further provides additional clarification and addresses stakeholders’ specific issues about certain aspects of the amendments in the previously issued ASU No. 2016-13. The standard is effective for fiscal years and interim periods beginning after December 15, 2019. Early adoption is permitted for all periods beginning after December 15, 2018. The Company determined that it will apply the modified retrospective transition method and does not expect the adoption of this standard to have a material impact on its investments. Additionally, the Company is currently evaluating the impact of this standard on its trade receivables and related disclosures. In August 2018, the FASB issued ASU 2018-13, Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The primary focus of the standard is to improve the effectiveness of the disclosure requirements for fair value measurements. The standard is effective for fiscal years and interim periods beginning after December 15, 2019. An entity is permitted to early adopt the removed or modified disclosures upon the issuance of the standard and may delay adoption of the additional disclosures until their effective date. The Company is currently evaluating the impact of adopting this standard. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes— Simplifying the Accounting for Income Taxes. The standard intends to simplify and reduce the cost of accounting for income taxes. The new guidance removes certain exceptions for recognizing deferred taxes for foreign investments, the incremental approach to performing intraperiod allocation, and calculating income taxes in interim periods for year to date losses that exceed anticipated full year losses. The standard also adds guidance to reduce complexity in certain areas, including accounting for franchise taxes that are partially based on income, transactions with a government that result with a step up in the tax basis of goodwill, enacted changes in tax law during interim periods, and allocating taxes to members of a consolidated group which are not subject to tax. For public business entities, the amendments in ASU 2019-12 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted for all periods in which financial statements have not yet been issued, including interim periods. The Company is currently evaluating the impact of adopting the new guidance.
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Investments and Fair Value of Financial Instruments |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments and Fair Value of Financial Instruments | 3. Investments and Fair Value of Financial Instruments Marketable Investments The Company’s marketable investments have been classified and accounted for as available-for-sale. The Company’s marketable investments as of December 31, 2019 and 2018 were as follows (in thousands):
The following tables present the gross unrealized losses and the fair value for those marketable investments that were in an unrealized loss position for less than and more than twelve months as of December 31, 2019 and 2018 (in thousands):
The contractual maturities of the Company’s marketable investments as of December 31, 2019 and 2018 were as follows (in thousands):
Non-Marketable Equity Investments In the second quarter of 2017, the Company and Sixense Enterprises, Inc. (“Sixense”) formed MVI as a privately-held joint venture for the purpose of exploring healthcare applications of virtual reality technology, with each party holding 50% of the issued and outstanding equity of MVI. On August 31, 2018 (“Transfer Agreement Closing Date”), the Company entered into a Stock Transfer Agreement (the “Transfer Agreement”) between the Company, MVI and Sixense, to purchase an additional 40% of the equity interest in MVI from Sixense for an initial cash purchase price of $20.0 million, excluding the additional $4.5 million of probable future payments relating to an anti-dilution provision in the Transfer Agreement. Following the Transfer Agreement Closing Date, the Company owns a 90% controlling interest in MVI and Sixense retains the remaining 10% minority interest. Prior to the Transfer Agreement Closing Date, the Company accounted for its investment in MVI under the equity method and was not required to consolidate MVI and determined that MVI was not a variable interest entity (“VIE”). Furthermore, pursuant to agreements between the parties at the time of MVI’s formation, the Company was obligated to perform certain services or make additional cash contributions to MVI for no additional equity interest. These services included, but were not limited to, information technology, accounting, other administrative services and research and development. The Company’s contributions made prior to the Transfer Agreement Closing Date are presented as a component of the “Contributions to non-marketable investments” in the consolidated statements of cash flows. For the eight months ended August 31, 2018, prior to the Transfer Agreement Closing Date, MVI had no revenue and recorded a net loss of $6.2 million. The Company reflected its 50% share of MVI’s losses as equity in losses of unconsolidated investee in the consolidated statements of operations through the Transfer Agreement Closing Date. Prior to the Transfer Agreement Closing Date, the unconsolidated balance sheet of MVI had total assets of $5.2 million, total liabilities of $1.0 million and total equity of $4.2 million. As of December 31, 2018, the unconsolidated balance sheet of MVI primarily consists of cash remaining from the initial investment and intangible assets totaling $7.9 million. Impact of Transfer Agreement on Non-Marketable Equity Investments The Company accounted for the Transfer Agreement as an asset acquisition, as it was determined that the transaction did not meet the definition of a business under the framework of the authoritative accounting guidance for business combinations. The total consideration transferred has been allocated to the non-monetary assets acquired and liabilities assumed based on their relative fair value. The following table presents the components of the consideration transferred at fair value as of the Transfer Agreement Closing Date (amounts presented in thousands):
In addition to the cash transferred, the consideration included a probable contingent liability related to an anti-dilution provision whereby the Company may be obligated to contribute funds for the issuance of additional shares of MVI to Sixense with an aggregate value of up to $4.5 million. The consideration transferred also included the $2.2 million carrying amount of the Company’s equity method investment in MVI as of the Transfer Agreement Closing Date, which was written-off as part of the accounting for the Transfer Agreement. The Company also recorded $3.4 million in non-controlling interest on the consolidated financial statements related to the fair value of the remaining minority interest held by Sixense as of the Transfer Agreement Closing Date. The primary asset acquired in the Transfer Agreement constitutes an in-process research and development asset (“IPR&D”). Due to the nature of the other assets acquired and liabilities assumed, the difference between the fair value of the consideration transferred and the fair value of the tangible net liabilities acquired was allocated solely to the IPR&D. The Company recorded a charge of $30.8 million to acquired in-process research and development expense in the consolidated statements of operations at the Transfer Agreement Closing Date because the Company determined that (1) the IPR&D asset had not yet reached technological feasibility and MVI had not yet obtained the appropriate regulatory approval for any products and (2) the asset had no alternative future use as of the Transfer Agreement Closing Date. Following the Transfer Agreement Closing Date, the financial results of MVI have been consolidated into the accompanying consolidated financial statements, with the amounts attributable to the non-controlling interest classified separately. Refer to Note “6. Asset Acquisition” for more information on the anti-dilution provision and payments related to the 2018 asset acquisition of MVI. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The categorization of a financial instrument within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company classifies its cash equivalents and marketable investments within Level 1 and Level 2, as it uses quoted market prices or alternative pricing sources and models utilizing market observable inputs. The Company determined the fair value of its Level 1 financial instruments, which are traded in active markets, using quoted market prices for identical instruments. Marketable investments classified within Level 2 of the fair value hierarchy are valued based on other observable inputs, including broker or dealer quotations or alternative pricing sources. When quoted prices in active markets for identical assets or liabilities are not available, the Company relies on non-binding quotes from its investment managers, which are based on proprietary valuation models of independent pricing services. These models generally use inputs such as observable market data, quoted market prices for similar instruments, historical pricing trends of a security as relative to its peers. To validate the fair value determination provided by its investment managers, the Company reviews the pricing movement in the context of overall market trends and trading information from its investment managers. In addition, the Company assesses the inputs and methods used in determining the fair value in order to determine the classification of securities in the fair value hierarchy. The following tables set forth the Company’s financial assets and liabilities measured at fair value by level within the fair value hierarchy (in thousands):
Contingent Consideration Obligations As of December 31, 2019, there is no contingent consideration liability balance classified as Level 3. The Company's contingent consideration liability balance of $1.2 million as of December 31, 2019 is based on actual revenue performance for the year ended December 31, 2019 and is not based on unobservable inputs. As of December 31, 2018, the Company’s contingent consideration liability relates to milestone payments due in connection with the acquisition of Crossmed and is classified as a Level 3 measurement for which fair value is derived from various inputs, including forecasted revenues during the earn-out milestone periods, revenue volatilities, discount rates, and estimates in the timing and likelihood of achieving revenue-based milestones. The fair value of the contingent consideration liability is remeasured each reporting period. Of the $2.6 million contingent consideration liability as of December 31, 2018, $1.3 million relates to a liability based on actual revenue performance for the year ended December 31, 2018 and is not based on unobservable inputs. Accordingly, only the portion of the contingent consideration liability based on unobservable inputs is included in the table below. The following table presents quantitative information about certain unobservable inputs used in the Level 3 fair value measurement of the Company’s contingent consideration liability, other than the forecasted revenues during the earn-out milestone period:
The following table summarizes the changes in fair value of the contingent consideration obligation for the year ended December 31, 2019 (in thousands):
During the year ended December 31, 2019, there were no material changes to the fair value of the contingent consideration obligation for the final remaining earn-out payment. During the year ended December 31, 2018, the fair value of the contingent consideration obligation increased by $1.0 million, which was recorded in sales, general and administrative expense in the consolidated statements of operations. The fair value of the contingent consideration increased as a result of updates to the underlying forecasts based on actual results to date and changes in estimates. For more information related to the payment of the contingent consideration liabilities refer to Note “5. Business Combinations.” During the years ended December 31, 2019, 2018, and 2017, the Company did not record impairment charges related to its marketable investments and the Company did not hold any Level 3 marketable investments as of December 31, 2019 and 2018. During the year ended December 31, 2019 and 2018, the Company did not have any transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy. Additionally, the Company did not have any financial assets and liabilities measured at fair value on a non-recurring basis as of December 31, 2019 and 2018.
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Balance Sheet Components |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet Components | 4. Balance Sheet Components Accounts Receivable, Net The Company’s allowance for doubtful accounts comprised of the following (in thousands):
(1) Represents the effect of currency translation adjustments and write-offs of uncollectible accounts, net of recoveries. Inventories The components of inventories consisted of the following (in thousands):
Property and Equipment, Net Property and equipment, net consisted of the following (in thousands):
Depreciation and amortization expense, excluding intangible assets and software, was $5.9 million, $4.4 million and $3.0 million for the years ended December 31, 2019, 2018 and 2017, respectively. Software amortization expense was $0.9 million, $0.7 million and $0.4 million for the years ended December 31, 2019, 2018 and 2017, respectively. The Company had accumulated software amortization of $2.3 million and $1.3 million for the years ended December 31, 2019 and 2018, respectively. Accrued Liabilities The following table shows the components of accrued liabilities as of December 31, 2019 and 2018 (in thousands):
(1) Acquisition-related costs consist of the current portion of contingent liabilities related to (1) the cash milestone payments and working capital adjustment liabilities for the acquisition of Crossmed and (2) an anti-dilution provision for the asset acquisition of MVI. Refer to Note “5. Business Combinations” for more information on the acquisition of Crossmed and Note “3. Investments and Fair Value of Financial Instruments” and Note “6. Asset Acquisition” for more information on the MVI asset acquisition. The following table shows the changes in the Company’s estimated product warranty accrual, included in accrued liabilities, as of December 31, 2019, 2018 and 2017 (in thousands):
Other Non-Current Liabilities The following table shows the components of other non-current liabilities as of December 31, 2019 and 2018 (in thousands):
(1) Amount relates to the non-current liability recorded for probable future milestone payments to be made under the indefinite-lived intangible assets related to licensed technology described in Note “7. Intangible Assets.” Refer therein for more information.
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Business Combinations |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations | 5. Business Combinations On July 3, 2017 (the “Closing Date”), the Company completed the acquisition of Crossmed, a joint stock company organized under the laws of Italy. Crossmed is engaged in the business of distributing medical supplies and equipment in Italy, San Marino, Vatican City and Switzerland. Crossmed was the Company’s exclusive distributor in Italy, San Marino, and Vatican City and the acquisition provides the Company with a direct relationship with its customers in these regions. The Company is obligated to pay additional consideration in the form of milestone payments based on Crossmed’s net revenue and may be required to pay additional consideration based on incremental net revenue for each of the years ended December 31, 2017, 2018, and 2019. There is no limit on the milestone payments that can be paid out. As of December 31, 2019 and December 31, 2018, the fair value of the liability related to the future cash milestone payments was $1.2 million and $2.6 million and was classified as a current liability on the consolidated balance sheet. For more information with respect to the nature and fair value of the Company’s contingent consideration obligations, refer to Note “3. Investments and Fair Value of Financial Instruments.” During the year ended December 31, 2019, the Company made $1.3 million in milestone payments of which $0.6 million is presented in operating activities and $0.7 million is presented in financing activities in the consolidated statements of cash flows. During the year ended December 31, 2018, the Company made $4.5 million in cash payments to the Sellers, of which $3.0 million related to the achievement of the 2017 milestones and the remainder related to working capital and financial debt adjustments. These payments have been presented as a component of financing activities in the consolidated statements of cash flows due to the nature and timing of the payments. The purchase price measurement period was closed as of June 30, 2018. For the periods ended December 31, 2019 and 2018, Crossmed results of operations were included in the consolidated statements of operations. The following table presents the allocation of the purchase price for Crossmed, reflecting the measurement period adjustments recorded in 2017 (in thousands):
The intangible assets acquired are amortized on a straight-line basis over their assigned estimated useful lives. The amortization of the acquired intangible assets are not deductible for tax purposes. As a result, a $2.5 million deferred tax liability was recorded as of the Closing Date. The goodwill arising from the Crossmed acquisition is primarily attributed to expected synergies from future growth and assembled workforce. Goodwill is not deductible for tax purposes. The following table presents certain unaudited pro forma information, for illustrative purposes only, for the year ended December 31, 2017, as if Crossmed had been acquired on January 1, 2016. The pro forma information may not be indicative of what would have occurred had the acquisition taken place on January 1, 2016, and may not be indicative of the Company’s future consolidated results. The unaudited pro forma information is presented below (unaudited, in thousands):
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Asset Acquisition |
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Dec. 31, 2019 | |
Asset Acquisition [Abstract] | |
Asset Acquisition | 6. Asset Acquisition Payments Related to 2018 MVI Asset Acquisition In the third quarter of 2018, the Company completed its asset acquisition to obtain a controlling interest of MVI pursuant to the Transfer Agreement between the Company, MVI and Sixense to obtain a controlling interest of MVI. During the year ended December 31, 2019, the Company contributed $1.0 million to MVI related to the anti-dilution provision, $0.8 million relates to cash payments which is presented in financing activities in the consolidated statements of cash flows and $0.2 million relates to non-cash contributions primarily related to in-kind services and goods provided to MVI. During the year ended December 31, 2018, the Company contributed $0.5 million to MVI related to the anti-dilution provision. As of December 31, 2019, the Company’s consolidated balance sheet included $3.0 million in current liabilities related to the anti-dilution provision in the Transfer Agreement. As of December 31, 2018, the Company’s consolidated balance sheet included $1.5 million and $2.5 million, respectively, in current and non-current liabilities related to the anti-dilution provision in the Transfer Agreement.
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Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets | 7. Intangible Assets The following table presents details of the Company’s acquired finite-lived and indefinite-lived intangible assets as of December 31, 2019 and 2018 (in thousands, except weighted-average amortization period):
The customer relationships and other intangible assets subject to amortization relate to the acquisition of Crossmed during the third quarter of 2017. The gross carrying amount and accumulated amortization of these intangible assets are subject to foreign currency translation effects. Refer to Note “5. Business Combinations” for more information. The Company’s $5.3 million trade secrets and processes intangible asset was recognized in connection with a royalty buyout agreement during the first quarter of 2018, which is discussed further in Note “10. Commitments and Contingencies” and Note “11. Stockholders’ Equity.” The following table presents the amortization recorded related to the Company’s finite-lived intangible assets for the years ended December 31, 2019, 2018 and 2017 (in thousands):
As of December 31, 2019, expected amortization expense for the unamortized acquired intangible assets for the next five years and thereafter is as follows (in thousands):
Licensed technology During the third quarter of 2017, the Company entered into an exclusive technology license agreement (the “License Agreement”) that required the Company to pay an upfront payment to the licensor of $2.5 million and future revenue milestone-based payments on sales of products covered by the licensed intellectual property. The Company accounted for the transaction as an asset acquisition and recorded an indefinite-lived intangible asset as it was determined to have alternative future use. The Company recorded an indefinite-lived intangible asset equal to the total payments made and expected to be made under the License Agreement and a corresponding contingent liability for the probable future milestone payments not yet paid. Upon the commercialization of the underlying product utilizing the licensed technology, the capitalized amount will be amortized over its estimated useful life. At the end of each reporting period the Company adjusts the contingent liabilities to reflect the amount of future milestone payments that are probable to be paid. Prior to the commercialization of products utilizing the underlying technology, any changes in the contingent liability are recorded as an adjustment between the liability balances and the gross carrying amount of the indefinite-lived intangible asset. As of December 31, 2019, the balance of the contingent liability related to probable future milestone payments under the License Agreement was $11.7 million, of which $0.8 million and $10.9 million were included in accrued liabilities and other non-current liabilities on the condensed consolidated balance sheet, respectively. As of December 31, 2018, the balance of the contingent liability related to probable future milestone payments under the Licensing Agreement was $12.4 million, of which $0.9 million and $11.5 million were included in accrued liabilities and other non-current liabilities on the consolidated balance sheet, respectively. As of December 31, 2019, the gross carrying amount of the indefinite-lived intangible asset was $14.2 million.The Company completed its annual impairment analysis of its indefinite-lived intangible asset during the fourth quarter of 2019 and determined that there was no impairment of the indefinite-lived intangible asset.
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Goodwill | 8. Goodwill The following table presents the changes in goodwill during the year ended December 31, 2019 (in thousands):
Goodwill Impairment Review The Company reviews goodwill for impairment annually during the fourth quarter, on October 31st, or more frequently if events or circumstances indicate that an impairment loss may have occurred. During the fourth quarter of 2019 and 2018, the Company reviewed goodwill for impairment and no impairment was identified.
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Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | 9. Leases Adoption of ASC Topic 842, “Leases” The Company adopted the guidance under ASC 842 on January 1, 2019 using the modified retrospective transition approach. Therefore the comparative prior year information has not been adjusted and continues to be reported under ASC 840. The impact of the adoption of ASC 842 on the Company’s consolidated balance sheet as of January 1, 2019 was as follows (in thousands):
(1) Upon the adoption of ASC 842, prepaid rent is included in the operating lease right-of-use assets. (2) Upon the adoption of ASC 842, current and non-current deferred rent is included in the current and non-current operating lease liabilities. Lease Overview As of December 31, 2018 and December 31, 2019, the Company’s contracts that contained a lease consisted of real estate, equipment and vehicle leases. The Company leases real estate for office and warehouse space under non-cancelable operating and finance leases that expire at various dates through 2035, subject to the Company’s option to renew certain leases for an additional to years. The Company also leases other equipment and vehicles primarily under non-cancelable operating leases that expire at various dates through 2024. The following table presents the components of the Company’s lease cost, lease term and discount rate during the year ended December 31, 2019 (in thousands, except years and percentages):
(1) Variable lease costs represent payments that are dependent on usage, a rate or index. Variable lease cost primarily relates to common area maintenance charges for its real estate leases as the Company elected not to separate non-lease components from lease components upon adoption of ASC 842. Prior to January 1, 2019, the Company recorded operating lease rent expense under ASC 840 on a straight-line basis over the non-cancelable lease term. Rent expense for the year ended December 31, 2018 and 2017 was $5.8 million and $5.8 million, respectively. As of December 31, 2018, the Company did not have material finance leases. During the third quarter of 2019, the Company signed a year lease for additional space at the Company’s headquarters located at 1310 Harbor Bay Business Park, Alameda, California (the “1310 Harbor Bay Lease”) which has not yet commenced as of December 31, 2019. The 1310 Harbor Bay Lease is expected to commence upon substantial completion of lessor owned improvements in connection with the development of the building which the Company anticipates will occur in the next two years. During the third quarter of 2018, the Company signed a year lease for a manufacturing facility in Roseville, California (as amended, the “Roseville Lease”). In the fourth quarter of 2019, the Roseville lease commenced once the building was made ready and available for its intended use. The Company determined that the Roseville lease is a non-cancelable finance lease which will expire in 2035. The following table is a schedule, by years, of maturities of the Company's operating and finance lease liabilities as of December 31, 2019 (in thousands):
(1) The table above excludes the estimated future minimum lease payment for the 1310 Harbor Bay Lease due to uncertainty around the timing of when the 1310 Harbor Bay Lease will commence and payments will be due. The total estimated lease payments over the year lease term will be calculated based on the total development costs incurred in connection with the development of the building which will be determined upon substantial completion of the building. The following table below shows the maturities of the Company’s operating lease liabilities previously disclosed under ASC 840 as of December 31, 2018 (in thousands):
(1) The table above excluded the estimated future minimum lease payment for the Roseville Lease, due to the uncertainty around the timing of when the Roseville Lease would commence and payments would be due as of December 31, 2018. Supplemental cash flow information related to leases during the year ended December 31, 2019 are as follows (in thousands):
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Leases | 9. Leases Adoption of ASC Topic 842, “Leases” The Company adopted the guidance under ASC 842 on January 1, 2019 using the modified retrospective transition approach. Therefore the comparative prior year information has not been adjusted and continues to be reported under ASC 840. The impact of the adoption of ASC 842 on the Company’s consolidated balance sheet as of January 1, 2019 was as follows (in thousands):
(1) Upon the adoption of ASC 842, prepaid rent is included in the operating lease right-of-use assets. (2) Upon the adoption of ASC 842, current and non-current deferred rent is included in the current and non-current operating lease liabilities. Lease Overview As of December 31, 2018 and December 31, 2019, the Company’s contracts that contained a lease consisted of real estate, equipment and vehicle leases. The Company leases real estate for office and warehouse space under non-cancelable operating and finance leases that expire at various dates through 2035, subject to the Company’s option to renew certain leases for an additional to years. The Company also leases other equipment and vehicles primarily under non-cancelable operating leases that expire at various dates through 2024. The following table presents the components of the Company’s lease cost, lease term and discount rate during the year ended December 31, 2019 (in thousands, except years and percentages):
(1) Variable lease costs represent payments that are dependent on usage, a rate or index. Variable lease cost primarily relates to common area maintenance charges for its real estate leases as the Company elected not to separate non-lease components from lease components upon adoption of ASC 842. Prior to January 1, 2019, the Company recorded operating lease rent expense under ASC 840 on a straight-line basis over the non-cancelable lease term. Rent expense for the year ended December 31, 2018 and 2017 was $5.8 million and $5.8 million, respectively. As of December 31, 2018, the Company did not have material finance leases. During the third quarter of 2019, the Company signed a year lease for additional space at the Company’s headquarters located at 1310 Harbor Bay Business Park, Alameda, California (the “1310 Harbor Bay Lease”) which has not yet commenced as of December 31, 2019. The 1310 Harbor Bay Lease is expected to commence upon substantial completion of lessor owned improvements in connection with the development of the building which the Company anticipates will occur in the next two years. During the third quarter of 2018, the Company signed a year lease for a manufacturing facility in Roseville, California (as amended, the “Roseville Lease”). In the fourth quarter of 2019, the Roseville lease commenced once the building was made ready and available for its intended use. The Company determined that the Roseville lease is a non-cancelable finance lease which will expire in 2035. The following table is a schedule, by years, of maturities of the Company's operating and finance lease liabilities as of December 31, 2019 (in thousands):
(1) The table above excludes the estimated future minimum lease payment for the 1310 Harbor Bay Lease due to uncertainty around the timing of when the 1310 Harbor Bay Lease will commence and payments will be due. The total estimated lease payments over the year lease term will be calculated based on the total development costs incurred in connection with the development of the building which will be determined upon substantial completion of the building. The following table below shows the maturities of the Company’s operating lease liabilities previously disclosed under ASC 840 as of December 31, 2018 (in thousands):
(1) The table above excluded the estimated future minimum lease payment for the Roseville Lease, due to the uncertainty around the timing of when the Roseville Lease would commence and payments would be due as of December 31, 2018. Supplemental cash flow information related to leases during the year ended December 31, 2019 are as follows (in thousands):
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Commitments and Contingencies |
12 Months Ended |
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Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. Commitments and Contingencies Purchase Commitments As of December 31, 2019, the Company had non-cancelable purchase obligations to suppliers of $15.1 million. Royalty Obligations In March 2005, the Company entered into a license agreement that requires the Company to make minimum royalty payments to the licensor, on a quarterly basis. As of December 31, 2018 and 2017, the license agreement requires minimum annual royalty payments of $0.1 million in equal quarterly installments. On each January 1, the quarterly calendar year minimum royalty shall be adjusted to equal the prior year’s minimum royalty adjusted by a percentage equal to the percentage change in the “consumer price index for all urban consumers” for the prior calendar year as reported by the U.S. Department of Labor. Unless terminated earlier, the term of the license agreement shall continue until the expiration of the last to expire patent that covers that licensed product or for the period of years following the first commercial sale of such licensed product, whichever is longer. The first commercial sale of covered products occurred in June 2007. In July 2019, the Company amended the license agreement to extend the term for an additional years. As of December 31, 2019, the amended license agreement required minimum annual royalty payments of $0.3 million in equal quarterly installments through 2027. In April 2012, the Company entered into an agreement that requires the Company to pay, on a quarterly basis, a 5% royalty on sales of products covered under applicable patents. The first commercial sale of covered products occurred in April 2014. Unless terminated earlier, the royalty term for each applicable product shall continue for years following the first commercial sale of such patented product, or when the applicable patent covering such product has expired, whichever is sooner. In November 2013, the Company entered into an agreement that requires the Company to pay, on a quarterly basis, a 3% royalty on the first $5 million in sales and a 1% royalty on sales thereafter of products covered under applicable patents. The agreement was terminated effective January 1, 2018. In April 2015, the Company entered into a royalty agreement that required the Company to pay a 2% royalty on sales of certain products covered by the agreement, on a quarterly basis, in exchange for certain trade secrets and processes which were used to develop such covered products. The Company began the first commercial sale of the covered products in July 2015. In the first quarter of 2018, the Company entered into a buyout of this agreement (the “Buyout Agreement”) in which future royalty payments were canceled in exchange for shares of the Company’s common stock with a fair value of $5.3 million. The Company recorded an intangible asset equal to the $5.3 million buyout amount which will be amortized into cost of revenue over the period in which the Company receives future economic benefit. After determining that the pattern of future cash flows associated with this intangible asset could not be reliably estimated with a high level of precision, the Company concluded that the intangible asset will be amortized on a straight-line basis over its estimated useful life. For more information refer to Note “11. Stockholders’ Equity.” Royalty expense included in cost of sales for the years ended December 31, 2019, 2018 and 2017 was $3.8 million, $3.4 million and $4.1 million, respectively. Contingencies From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. Refer to Note “3. Investments and Fair Value of Financial Instruments,” Note “5. Business Combinations” and Note “7. Intangible Assets” for more information on contingent liabilities recorded on the consolidated balance sheet. Indemnification The Company enters into standard indemnification arrangements in the ordinary course of business. In many such arrangements, the Company agrees to indemnify, hold harmless, and reimburse the indemnified parties for losses suffered or incurred by the indemnified parties in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to the Company’s technology. The Company also agrees to indemnify many indemnified parties for product defect and similar claims. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with any of these indemnification requirements has been recorded to date. Litigation From time to time, the Company is subject to other claims and assessments in the ordinary course of business. The Company is not currently a party to any such litigation matter that, individually or in the aggregate, is expected to have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.
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Stockholders' Equity |
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Share-based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity | 11. Stockholders’ Equity Stockholders’ Equity Preferred Stock The Company has 5,000,000 of authorized preferred stock issuable. There is no preferred stock outstanding as of December 31, 2019 and 2018. Common Stock Each share of common stock is entitled to one vote. The holders of common stock are also entitled to receive dividends whenever funds are legally available and when declared by the board of directors, subject to the prior rights of holders of all classes of stock outstanding. In the first quarter of 2018, the Company issued 53,256 fully vested restricted stock units with a fair value of $5.3 million in connection with the Buyout Agreement, as discussed in Note “10. Commitments and Contingencies.” The Company recorded the $5.3 million fair value of the shares issued to additional-paid in capital on the consolidated balance sheet upon the issuance of the awards, with the associated expense being amortized into cost of sales over the period in which the Company receives future economic benefit from the buyout. Issuance of Common Stock in Public Offerings In March 2017, the Company issued and sold an aggregate of 1,495,000 shares of common stock at a public offering price of $76.00 per share, less the underwriters’ discounts and commissions, pursuant to an underwritten public offering. The Company received approximately $106.3 million in net cash proceeds after deducting underwriting discounts and commissions of $6.8 million and other offering expenses of $0.5 million. Stock-Based Benefit Plans 2005 Stock Plan The Company adopted the Penumbra, Inc. 2005 Stock Plan (the “2005 Plan”) in January 2005. The 2005 Plan was subsequently amended and restated in 2006, 2007, 2008 and 2010. Under the 2005 Plan, the board of directors could grant incentive stock options (“ISOs”), non-qualified stock options (“NSOs”), and/or stock awards to eligible persons, including employees, non-employees, directors, consultants and other independent advisors who provide services to the Company. Stock purchase rights could also be granted under the 2005 Plan. The board of directors had the authority to determine to whom options would be granted, the number of options, the term and the exercise price. ISOs could only be granted to Company employees, which include officers and directors of the Company. NSOs and stock purchase rights could be granted to employees and consultants. For individuals holding more than 10% of the voting rights of all classes of stock, the exercise price for an ISO could not be less than 110% of the fair market value of a share of common stock on the date of grant. Options granted under the 2005 Plan permitted an optionee to exercise options immediately upon grant irrespective of the vesting term. Options generally vest annually at a rate of 1/4 after the first year and 1/48 per month thereafter. The term of the options is no longer than years for ISOs, for which the grantee owns greater than 10% of the voting power of all classes of stock and no longer than 10 years for all other options. On September 17, 2015, the Penumbra, Inc. 2014 Equity Incentive Plan (as amended and restated, the “2014 Plan”) replaced the 2005 Plan and no further equity awards may be granted under the 2005 Plan. The remaining 564 shares of common stock available for issuance from the 2005 Plan were transferred to and may be granted under the 2014 Plan. As of December 31, 2019, 187,985 shares of common stock were reserved for issuance under the 2005 Plan. 2011 Equity Incentive Plan The Company adopted the Penumbra, Inc. 2011 Equity Incentive Plan (the “2011 Plan”) in October 2011. Under the 2011 Plan, the board of directors could grant ISOs, NSOs, restricted stock, and/or RSUs to eligible persons, including employees, directors and consultants who provide services to the Company. Stock Appreciation Rights (“SAR”) could also be granted under the 2011 Plan. The board of directors had the authority to determine to whom options would be granted, the number of options, the term and the exercise price. ISOs could only be granted to Company employees, which include officers and directors of the Company. NSOs, SARs, restricted stock and RSUs could be granted to employees and consultants. For individuals holding more than 10% of the voting rights of all classes of stock, the exercise price for an ISO could not be less than 110% of the fair market value of a share of common stock on the date of grant. Stock options granted under the 2011 Plan generally have a contractual life of years, and generally vest over a period of years. On September 17, 2015, the 2014 Plan replaced the 2011 Plan and no further equity awards may be granted under the 2011 Plan. The remaining 89,559 shares of common stock available for issuance under the 2011 Plan were transferred to and may be granted under the 2014 Plan. As of December 31, 2019, 145,000 shares of common stock were reserved for issuance under the 2011 Plan. Amended and Restated 2014 Equity Incentive Plan The Company adopted the Penumbra, Inc. 2014 Equity Incentive Plan in May 2014. The plan was amended and restated as of September 17, 2015 (as amended and restated, the “2014 Plan”). The 2014 Plan replaced the 2011 Plan and the 2005 Plan and no further equity awards may be granted under the 2011 Plan or the 2005 Plan. As of December 31, 2019, 8,376,751 shares of common stock were reserved for issuance and 6,959,455 shares of common stock were available for grant under the 2014 Plan. Employee Stock Purchase Plan The Penumbra, Inc. Employee Stock Purchase Plan (the “ESPP”), became effective on September 17, 2015. The ESPP initially reserved 600,000 shares of common stock for purchase under the ESPP, with the number of shares reserved for purchase increasing each year pursuant to an “evergreen” provision set forth in the ESPP. As of December 31, 2019, 1,095,695 shares of common stock were reserved and available for issuance under the plan. All qualifying employees of the Company and its designated subsidiaries are eligible to participate in the ESPP. Each offering to the Company’s employees to purchase stock under the ESPP will begin on each May 20 and November 20 and will end on the following November 19 and May 19, respectively, each referred to as offering periods except that the first offering period under the ESPP began on September 17, 2015 and ended on May 19, 2016. Under the ESPP, each employee may purchase shares by authorizing payroll deductions at a minimum of 1% and up to 15% of his or her eligible compensation for each pay period during the offering period. Unless the participating employee withdraws from the offering, his or her accumulated payroll deductions will be used to purchase the Company’s common stock on the last business day of the offering period at a price equal to 85% of the fair market value of the common stock on either the first or the last day of the offering period, whichever is lower, provided that no more than 2,000 shares of the Company’s common stock or such other lesser maximum number established by the ESPP administrator may be purchased by any one employee during each offering period. Under applicable tax rules, an employee may purchase no more than $25,000 worth of common stock, valued at the start of the purchase period (corresponding to an offering period), under the ESPP in any calendar year. Early Exercises The 2005 Plan and 2011 Plan allow the board of directors to grant stock options that provide employee option holders the right to elect to exercise unvested options in exchange for restricted common stock. As of December 31, 2019 and 2018, there were no such early exercised unvested shares. Stock-Based Benefit Plan Activity and Stock-Based Compensation Stock Options Activity of stock options under the 2005 Plan, 2011 Plan and 2014 Plan (collectively, the "Plans") is set forth below:
The total intrinsic value of stock options exercised during the years ended December 31, 2019, 2018 and 2017 was $46.1 million, $49.1 million and $56.4 million, respectively. The intrinsic value is calculated as the difference between the estimated fair value of the Company’s common stock at the exercise date and the exercise price of the stock option. The weighted average grant date fair value of stock options was $69.73 per share for the year ended December 31, 2019. The Company did not grant stock options during the years ended December 31, 2018 and 2017. Restricted Stock and Restricted Stock Units The activity of unvested restricted stock and restricted stock units ("RSU") under the Plans is set forth below:
The fair value of the restricted stock and RSUs that vested during the years ended December 31, 2019, 2018 and 2017 was $42.7 million, $47.0 million and $29.1 million, respectively. As of December 31, 2019, 348,676, RSUs are expected to vest. Employee Stock Purchase Plan Under the ESPP, employees purchased 81,644 shares, 74,344 shares, and 91,685 shares for $9.0 million, $7.2 million, and $5.8 million during the years ended December 31, 2019, 2018, and 2017 respectively. Stock-based Compensation The Company uses the Black-Scholes option pricing model to determine the fair value of stock options and ESPP rights. The valuation model for stock compensation expense requires the Company to make assumptions and judgments about the variables used in the calculation including the expected term (weighted average period of time that the options granted are expected to be outstanding); expected volatility of the Company’s common stock and an assumed risk-free interest rate. The Company used the following assumptions in its Black-Scholes option pricing model to determine the fair value of stock options granted in 2019:
The Company did not grant stock options during the years ended December 31, 2018 and 2017. The Company used the following assumptions in its Black-Scholes option pricing model to determine the fair value of ESPP rights:
Weighted Average Expected Term. The Company’s expected term for stock options and ESPP rights is based on historical data. Volatility. In 2019, 2018 and 2017, volatility assumptions used in the valuation of options and ESPP rights were calculated based on the historical volatility of the Company’s stock. Risk-Free Interest Rate. The risk-free interest rate is based upon U.S. Treasury zero-coupon issues with remaining terms similar to the expected term of the stock options or ESPP rights. Dividend Yield. The Company has never paid any dividends and does not plan to pay dividends in the foreseeable future, and therefore, used an expected dividend yield of zero in the valuation model. Forfeitures. The Company estimates forfeitures at the time of grant, and revises those estimates in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate pre-vesting forfeitures and record stock-based compensation expense only for those awards that are expected to vest. To the extent actual forfeitures differ from the estimates, the difference will be recorded as a cumulative adjustment in the period that the estimates are revised. The following table sets forth the stock-based compensation expense included in the consolidated statements of operations (in thousands):
As of December 31, 2019, total unrecognized compensation cost was $43.0 million related to unvested stock-based compensation arrangements which is expected to be recognized over a weighted average period of 3.1 years. The total stock-based compensation cost capitalized in inventory was $0.8 million, $0.4 million and $0.2 million as of December 31, 2019, 2018 and 2017, respectively.
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Accumulated Other Comprehensive Loss |
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Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Loss | 12. Accumulated Other Comprehensive Loss Other comprehensive (loss) income consists of two components: unrealized gains or losses on the Company’s available-for-sale marketable investments and gains or losses from foreign currency translation adjustments. Until realized and reported as a component of consolidated net income, these comprehensive (loss) income items accumulate and are included within accumulated other comprehensive loss. Unrealized gains and losses on our marketable investments are reclassified from accumulated other comprehensive loss into earnings when realized upon sale, and are determined based on specific identification of securities sold. Gains and losses from the translation of assets and liabilities denominated in non-U.S. dollar functional currencies are included in accumulated other comprehensive loss. The following table summarizes the changes in the accumulated balances during the period, and includes information regarding the manner in which the reclassifications out of accumulated other comprehensive loss into earnings affect our consolidated statements of comprehensive income (loss) (in thousands):
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Employee Benefit Plan |
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Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | 13. Employee Benefit Plan The Company offers a retirement savings plan under Section 401(k) of the Internal Revenue Code (“IRC”) to its eligible U.S. employees whereby they may contribute up to the maximum amount permitted by the IRC. The Company makes 401(k) matching contributions of eligible compensation under the plan, subject to a maximum dollar threshold. Contribution expense was $3.2 million, $1.6 million, and $1.1 million for the years ended December 31, 2019, 2018 and 2017, respectively. |
Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | 14. Income Taxes The Company’s income tax (benefit) expense, deferred tax assets and liabilities, and reserves for unrecognized tax benefits reflect management’s best assessment of estimated current and future taxes to be paid. The Company is subject to income taxes in both the United States and foreign jurisdictions. Significant judgments and estimates are required in determining the consolidated income tax (benefit) expense. The Company is incorporated in the United States and operates in various countries with different tax laws and rates. A portion of the Company’s income or (loss) before taxes and the (benefit from) provision for income taxes are generated from international operations. Income (loss) before income taxes and equity in losses of unconsolidated investee for the years ended December 31, 2019, 2018 and 2017 is summarized as follows (in thousands):
Income tax (benefit) or provision in 2019, 2018 and 2017 is comprised of federal, state, and foreign taxes. The components of the (benefit from) provision for income taxes are summarized as follows (in thousands):
The Company’s actual (benefit from) or provision for tax differed from the amounts computed by applying the Company’s U.S. federal statutory income tax rate to pretax income as a result of the following:
Deferred income tax assets and liabilities consist of the following (in thousands):
As of December 31, 2019, the Company had approximately $89.3 million, $78.6 million and $0.4 million of federal, state and foreign net operating loss carryforwards, respectively, available to offset future taxable income. The federal net operating loss will begin to expire in 2036, except for $24.0 million that has an indefinite carryforward period but is limited to offset 80% of taxable income in the year utilized. The state net operating loss carryforwards will begin to expire in 2020. As of December 31, 2019, the Company had federal research credits of $9.2 million and California state tax credits of $10.5 million. The federal research credits are generally carried forward for 20 years. California state tax credits may be carried forward indefinitely. On December 22, 2017, the Tax Cuts and Jobs Act of 2017, (the “Tax Reform Act”) was enacted. The Tax Reform Act significantly revised the U.S. corporate income tax regime. Also on December 22, 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin 118 (“SAB 118”), which provided for a measurement period that should not extend beyond one year from the Tax Reform Act enactment date. As of December 31, 2018, the Company completed its accounting for the tax effects of the Tax Reform Act under FASB ASC 740 “Income Taxes”. The Company’s financial statements reflect tax law interpretations based on authoritative guidance available to date. Legislative guidance continues to be issued which could impact the Company’s current interpretations. The Company maintains that all foreign earnings, with the exception of a portion of the earnings of its German subsidiary, are permanently reinvested outside the U.S. and therefore deferred taxes attributable to such are not provided for in the Company’s financial statements as of December 31, 2019. The Company will repatriate foreign earnings only to the extent doing so will not result with any material U.S. tax consequences. Thus, deferred taxes on any potential future repatriation of a portion of the earnings of its German subsidiary were not reflected in the Company’s financial statements as of December 31, 2019. The Company generated significant domestic DTAs in recent years, primarily due to the excess tax benefits from stock option exercises and vesting of restricted stock. The Company assessed its ability to realize the benefits of its domestic DTAs by evaluating all available positive and negative evidence, objective and subjective in nature, including (1) cumulative results of operations in recent years, (2) sources of recent pre-tax income, (3) estimates of future taxable income, (4) respective carryback and/or carryforward periods of tax attributes available to date, and (5) limitations on net operating loss (“NOL”) utilization against taxable income. The Company determined it would be in a three-year cumulative taxable income position, had it not been for the impact of excess tax deductions from stock-based compensation. The Company also measured its current DTA balances against estimates of future income based on objectively verifiable operating results from the Company’s recent history. The Company considered its projections of future taxable income in conjunction with relevant provisions of the Tax Reform Act, including but not limited to, the indefinite carryforward period for NOLs generated in years beginning on or after January 1, 2018. The Company also considered its three-year cumulative taxable income position, exclusive of the impact of excess tax deductions from stock-based compensation. After an evaluation of all available qualitative and quantitative evidence, both positive and negative in nature, the Company concluded that sufficient future taxable income will be generated to realize the benefits of its federal DTAs prior to expiration other than its federal research and development tax credit DTAs. The tax attribute ordering rules provide that net operating losses must be used to offset taxable income prior to the utilization of tax credits. Accordingly, the Company could not assert, at the required more-likely-than-not level of certainty, that it will be able to realize the benefit of its federal research and development tax credit DTAs, with a limited 20 year carryforward period, prior to expiration. As a result, as of December 31, 2019, the Company maintained a full valuation allowance against its federal research and development tax credit DTAs. For years ended December 31, 2019, 2018 and 2017, a full valuation allowance remains against the Company’s California DTA balances. As of December 31, 2019, the Company’s DTA balance included $3.1 million of tax attributes gained upon acquisition of a majority interest ownership in MVI. The acquired DTAs are subject to Separate Return Limitation Year (“SRLY”) rules which will limit the utilization of the pre-acquisition tax attributes to offset future taxable income solely generated by MVI. As of December 31, 2019, the Company could not conclude, at the required more-likely-than-not level of certainty, that MVI will generate sufficient taxable income to realize the benefit of its tax attributes prior to expiration. As a result, a $3.1 million valuation allowance is maintained against the DTAs acquired from MVI. The change in the Company’s deferred tax valuation allowance against net DTAs from January 1, 2017 to December 31, 2019, is as follows (in thousands):
(1) Additions include current year additions charged to expenses and current year build due to increases in net DTAs, return to provision true-ups, and other adjustments. (2) Deductions include current year releases credited to expenses and current year reductions due to decreases in net DTAs, return to provision true-ups, and other adjustments. The Company will continue to closely monitor the need for a valuation allowance against its existing domestic and foreign DTAs and any additional DTAs that are generated in each subsequent reporting period. The need for a valuation allowance can be impacted by actual operating results, forecasted financial performance, variances between the two, and the rate at which future DTAs are generated. IRC Sections 382 and 383 limit the use of net operating losses and business credits if there is a change in ownership. In 2009, the Company determined there were changes in ownership in 2004 and 2008, which did not cause any impairment of tax attributes. A reconciliation of the change in the gross unrecognized tax benefits from January 1, 2017 to December 31, 2019, is as follows (in thousands):
The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. Income tax expense for the years ended December 31, 2019, 2018 and 2017 included interest and penalties that were not material. As of December 31, 2019, 2018 and 2017, the Company had approximately $0.2 million, $0.2 million, and $0.1 million, respectively, of accrued interest and penalties attributable to uncertain tax positions. Included in the $6.1 million balance of unrecognized tax benefits as of December 31, 2019 is $1.9 million of tax benefit that, if recognized, would affect the effective tax rate. The Company files U.S., state and foreign income tax returns in jurisdictions with varying statutes of limitations. Due to net operating loss and credit carryovers, the tax years ending December 31, 2004 through December 31, 2019 remain subject to examination by federal and state tax authorities. In Australia and Canada, tax years ending December 31, 2009 through December 31, 2019 generally remain subject to examination by tax authorities. In Germany and Italy, tax years ending December 31, 2013 through December 31, 2019 remain subject to examination by tax authorities. In the year ended December 31, 2018, the German tax authority initiated an income tax audit for tax years ended December 31, 2014, 2015 and 2016. The Company believes that an adequate provision has been made for any adjustments that may result from the tax examination, however, the audit is in its preliminary stages and so the outcome and timing of resolution is uncertain. The Company does not anticipate significant changes in the balance of gross unrecognized tax benefits over the next 12 months.
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Net Income Attributable to Penumbra, Inc. per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income Attributable to Penumbra, Inc. per Share | 15. Net Income Attributable to Penumbra, Inc. Per Share The Company computed basic net income attributable to Penumbra, Inc. per share based on the weighted average number of shares of common stock outstanding during the period. The Company computed diluted net income attributable to Penumbra, Inc. per share based on the weighted average number of shares of common stock outstanding plus potentially dilutive common stock equivalents outstanding during the period. For the purposes of this calculation, stock options, restricted stock, restricted stock units and stock sold through the ESPP are considered common stock equivalents. A reconciliation of the numerator and denominator used in the calculation of the basic and diluted net income attributable to Penumbra, Inc. is as follows (in thousands, except share and per share amounts):
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Revenues |
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Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | 16. Revenues Adoption of ASC Topic 606, “Revenue from Contracts with Customers” The Company adopted the guidance under ASC 606 on January 1, 2018 using the modified retrospective method for all contracts not completed as of the date of adoption. Therefore, the comparative prior year information has not been adjusted and continues to be reported under ASC 605 with the impact of the adoption reflected in opening retained earnings. As a result of adoption, the cumulative impact to our retained earnings at January 1, 2018 was $0.3 million. The adoption of ASC 606 represents a change in accounting principle that more closely aligns the timing of revenue recognition with the point in time that a performance obligation is satisfied. The Company’s performance obligations are satisfied at a point in time. The implementation of the new standard did not have a material impact on the measurement or recognition of revenue from prior periods, however additional disclosures have been added in accordance with the guidance. Revenue Recognition Revenue is recognized in an amount that reflects the consideration we expect to be entitled to in exchange for goods or services. All revenue recognized in the income statement is considered to be revenue from contracts with customers. The Company’s revenues, disaggregated by geography, based on the destination to which the Company ships its products, for the years ended December 31, 2019, 2018 and 2017 was as follows (in thousands):
The Company’s revenues disaggregated by product category, for the years ended December 31, 2019, 2018 and 2017 was as follows (in thousands):
Performance Obligations Delivery of products - The Company’s contracts with customers typically contain a single performance obligation, delivery of the Company’s products. Satisfaction of that performance obligation occurs when control of the promised goods transfers to the customer, which is generally upon shipment for non-consignment sale agreements and upon utilization for consignment sale agreements. Payment terms - Our payment terms vary by the type and location of our customer. The timing between fulfillment of performance obligations and when payment is due is not significant and does not give rise to financing transactions. The Company did not have any contracts with significant financing components as of December 31, 2019. Product returns - The Company may allow customers to return products purchased at the Company’s discretion. The Company estimates the amount of its product sales that may be returned by its customers and records this estimate as a reduction of revenue in the period in which the related product revenue is recognized. The Company currently estimates product return liabilities using its own historic sales information, trends, industry data, and other relevant data points. Warranties - The Company offers its standard warranty to all customers and it is not available for sale on a standalone basis. The Company’s standard warranty represents its guarantee that its products function as intended, are free from defects, and comply with agreed-upon specifications and quality standards. This assurance does not constitute a service and is not a separate performance obligation. Transaction Price Revenue is recorded at the net sales price, which includes estimates of variable consideration such as product returns utilizing historical return rates, rebates, discounts, and other adjustments to net revenue. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price. When determining if variable consideration should be constrained, management considers whether there are factors that could result in a significant reversal of revenue and the likelihood of a potential reversal. Variable consideration is included in revenue only to the extent that it is probable that a significant reversal of the revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. These estimates are reassessed each reporting period as required. During the year ended December 31, 2019, the Company made no material changes in estimates for variable consideration. When the Company performs shipping and handling activities after control of goods is transferred to the customer, they are considered as fulfillment activities, and costs are accrued for when the related revenue is recognized. Taxes collected from customers relating to product sales and remitted to governmental authorities are excluded from revenues.
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Selected Quarterly Financial Data (Unaudited) | 17. Selected Quarterly Financial Data (Unaudited) The following tables provide the selected quarterly financial data for 2019 and 2018 (in thousands, except share and per share amounts):
(1) In first quarter of 2019, the Company adopted Accounting Standard Update (“ASU”) No. 2016-02, Leases (Topic 842), and its associated amendments. Under the standard, a lessee will be required to recognize a lease liability and right-of-use asset for all leases with terms in excess of twelve months. The Company elected to apply the modified retrospective transition approach to all leases existing at the date of initial application and not restate comparative periods. In addition, the Company elected the following transitional practical expedients: (1) the short-term lease exception and (2) to not separate its non-lease components for its real estate, vehicle and equipment leases. As a result of the adoption, there was no cumulative-effect adjustment recorded to retained earnings upon adoption. Refer to Note “2. Summary of Significant Accounting Policies” and Note “9. Leases” for more information. (2) In the first quarter of 2018, the Company adopted Accounting Standard Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (“Topic 606”), and its associated amendments. Under the standard, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. The Company applied the five step method outlined in the ASU to all revenue streams and elected to utilize the modified retrospective implementation method. As a result of adoption, the Company recorded a $0.3 million cumulative adjustment to its retained earnings at January 1, 2018. Refer to Note “2. Summary of Significant Accounting Policies” and Note “16. Revenues” for more information. (3) On August 31, 2018, the Company acquired a controlling interest in MVI which was accounted for as an asset acquisition. In connection with the transaction, the Company recorded a $30.8 million IPR&D charge during the three months ended September 30, 2018 in the consolidated statements of operations related to the acquired technology under development from MVI. Of the total IPR&D charge, $27.4 million was attributable to the net loss of Penumbra, Inc.
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Summary of Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and ConsolidationThe accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). Certain changes in presentation were made in the consolidated financial statements for the year ended December 31, 2018 and 2017, to conform to the presentation for the year ended December 31, 2019 |
Consolidation | The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and its majority-owned subsidiary. The portion of equity not attributable to the Company is considered non-controlling interest and is classified separately in the consolidated financial statements. Any subsequent changes in the Company’s ownership interest while the Company retains its controlling interest in its majority-owned subsidiary will be accounted for as equity transactions. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and equity accounts; disclosure of contingent assets and liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including those related to marketable investments, provisions for doubtful accounts, the amount of variable consideration included in the transaction price, warranty reserve, valuation of inventories, useful lives of property and equipment, operating and finance lease right-of-use (“ROU”) assets and liabilities, income taxes, contingent consideration and other contingencies, among others. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other data. Actual results could differ from those estimates.
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Segments | Segments The Company determined its operating segment on the same basis that it uses to evaluate its performance internally. The Company has one business activity: the design, development, manufacturing and marketing of innovative medical devices, and operates as one operating segment. The Company’s chief operating decision-maker (“CODM”), its Chief Executive Officer, reviews its consolidated operating results for the purpose of allocating resources and evaluating financial performance. |
Foreign Currency Translation | Foreign Currency Translation The Company’s consolidated financial statements are prepared in United States Dollars (“USD”). Its foreign subsidiaries use their local currency as their functional currency and maintain their records in the local currency. Accordingly, the assets and liabilities of these subsidiaries are translated into USD using the current exchange rates in effect at the balance sheet date and equity accounts are translated into USD using historical rates. Revenues and expenses are translated using the average exchange rates in effect for the year involved. The resulting foreign currency translation adjustments are recorded in accumulated other comprehensive loss in the consolidated balance sheets. Transactions denominated in currencies other than the respective functional currencies are translated at exchange rates as of the date of transaction with foreign currency gains and losses recorded in other expense, net in the consolidated statements of operations. The Company realized net foreign currency transaction losses of $0.8 million, $0.9 million and $1.0 million during the years ended December 31, 2019, 2018 and 2017, respectively. As the Company’s international operations grow, its risks associated with fluctuation in currency rates will become greater, and the Company will continue to reassess its approach to managing this risk. In addition, currency fluctuations or a weakening USD can increase the costs of the Company’s international expansion. To date, the Company has not entered into any foreign currency hedging contracts.
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Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents, marketable investments (as described in greater detail in this footnote under the header “Cash, Cash Equivalents and Marketable Investments” below) and accounts receivable. The majority of the Company’s cash is held by one financial institution in the U. S. in excess of federally insured limits. The Company maintained investments in money market funds that were not federally insured during the year ended December 31, 2019 and held cash in foreign entities of approximately $17.3 million and $23.4 million at December 31, 2019 and 2018, respectively, which was not federally insured. The Company’s revenue has been derived from sales of its products in the United States and international markets. The Company uses both its own salesforce and independent distributors to sell its products. Concentrations of credit risk with respect to accounts receivable are limited due to the large number of entities comprising the Company’s customer base. The Company performs ongoing credit evaluations of its customers, including its distributors, does not require collateral, and maintains allowances for potential credit losses on customer accounts when deemed necessary.
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Significant Risks and Uncertainties | Significant Risks and Uncertainties The Company is subject to risks common to medical device companies including, but not limited to, new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, product liability, uncertainty of market acceptance of products and the potential need to obtain additional financing. The Company is dependent on third party suppliers, in some cases single-source suppliers. There can be no assurance that the Company’s products will continue to be accepted in the marketplace, nor can there be any assurance that any future products can be developed or manufactured at an acceptable cost and with appropriate performance characteristics, or that such products will be successfully marketed, if at all. The Company’s products require approval or clearance from the FDA prior to commencing commercial sales in the United States. There can be no assurance that the Company’s products will receive all of the required approvals or clearances. Approvals or clearances are also required in foreign jurisdictions in which the Company sells its products. If the Company is denied such approvals or clearances or such approvals or clearances are delayed, it may have a material adverse impact on the Company’s results of operations, financial position and liquidity.
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Fair Value of Financial Instruments | Fair Value of Financial Instruments Carrying amounts of certain of the Company’s financial instruments, including cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued liabilities, approximate fair value due to their relatively short maturities. |
Cash and Cash Equivalents | Cash, Cash Equivalents and Marketable Investments The Company invests its cash primarily in highly liquid corporate debt securities, debt instruments of U.S. federal, state and municipal governments, and their agencies, in money market funds and in commercial paper. All highly liquid investments with stated maturities of three months or less from the date of purchase are classified as cash equivalents; all highly liquid investments with stated maturities of greater than three months are classified as marketable investments. The majority of the Company’s cash and investments are held in U.S. banks. |
Marketable Investments | The Company determines the appropriate classification of its investments in marketable investments at the time of purchase and re-evaluates such designation at each balance sheet date. The Company’s marketable investments have been classified and accounted for as available-for-sale. Investments with remaining maturities of more than one year are viewed by the Company as available to support current operations and are classified as current assets under the caption marketable investments in the accompanying consolidated balance sheets. Investments in marketable investments are carried at fair value, with the unrealized gains and losses reported as a component of accumulated other comprehensive loss. Any realized gains or losses on the sale of marketable investments are determined on a specific identification method, and such gains and losses are reflected as a component of other income (expense), net. Impairment of Marketable Investments After determining the fair value of available-for-sale debt instruments, unrealized gains or losses on these securities are recorded to accumulated other comprehensive loss until either the security is sold or the Company determines that the decline in value is other-than-temporary. The primary differentiating factors that the Company considers in classifying impairments as either temporary or other-than-temporary impairments is the intent and ability to retain the investment in the issuer for a period of time sufficient to allow for any anticipated recovery in market value, the length of the time and the extent to which the market value of the investment has been less than cost, the financial condition, and near-term prospects of the issuer. There were no other-than-temporary impairments for the years ended December 31, 2019, 2018 or 2017. |
Non-Marketable Equity Investments | Non-Marketable Equity Investments Entities in which the Company has at least a 20%, but not more than a 50%, interest are accounted for under the equity method unless it is determined that the Company has a controlling financial interest in the entity, in which case the entity would be consolidated. Non-marketable equity investments are classified as long-term investments on the consolidated balance sheet. The Company’s proportionate share of the operating results of its non-marketable equity method investments are recorded as profit or loss and presented in equity in losses of unconsolidated investee, in the consolidated statements of operations. See Note “3. Investments and Fair Value of Financial Instruments” for further details.
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Accounts Receivable | Accounts Receivable Accounts receivable are stated at invoice value less estimated allowances for doubtful accounts. The Company continually monitors customer payments and maintains a reserve for estimated losses resulting from its customers’ inability to make required payments. The Company considers factors such as historical experience, credit quality, age of the accounts receivable balances, geographic related risks and economic conditions that may affect a customer’s ability to pay. In cases where there are circumstances that may impair a specific customer’s ability to meet its financial obligations, a specific allowance is recorded against amounts due, and thereby reduces the net recognized receivable to the amount reasonably believed to be collectible. |
Inventories | Inventories Inventories are stated at the lower of cost (determined under the first-in first-out method) or net realizable value. Write-downs are provided for raw materials, components or finished goods that are determined to be excessive or obsolete. The Company regularly reviews inventory quantities in consideration of actual loss experience, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. |
Property and Equipment, net | Property and Equipment, net Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or estimated useful life. Machinery and equipment and furniture and fixtures are depreciated over a | to year period and computers and software are depreciated over to years. Upon retirement or sale, the cost and the related accumulated depreciation are removed from the consolidated balance sheet and the resulting gain or loss is reflected in operations. Maintenance and repairs are charged to consolidated statements of operations as incurred.
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When such an event occurs, management determines whether there has been impairment by comparing the anticipated undiscounted future net cash flows to the related asset group’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. |
Contingent Consideration | Contingent Consideration Certain agreements the Company enters into, including business combinations, involve the potential payment of future consideration that is contingent upon certain performance and revenue milestones being achieved. Contingent consideration obligations incurred in connection with a business combination are recorded at their fair values on the acquisition date and remeasured at their fair values each subsequent reporting period until the related contingencies are resolved. The resulting changes in fair values are recognized generally within sales, general and administrative expense, depending on the nature of the contingent consideration liability, in the consolidated statements of operations. Asset acquisitions are accounted for using a cost accumulation and allocation model and the cost of the acquisition is allocated to the assets acquired and liabilities assumed. Contingent consideration obligations incurred in connection with an asset acquisition are recorded when it is probable that they will occur and they can be reasonably estimated. As of December 31, 2019 and 2018, the Company’s contingent consideration obligations in connection with business combinations relate to milestone payments for the acquisition of Crossmed S.p.A. (“Crossmed”). For more information with respect to the fair value of contingent consideration, refer to Note “5. Business Combinations.”
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Intangible Assets | Intangible Assets Intangible assets primarily consist of purchased rights to licensed technology, customer relationships, and trade secrets and processes. Indefinite-lived intangible assets relate to an exclusive right to licensed technology. The acquired licensed technology is accounted for as an indefinite-lived intangible asset. Upon the commercialization of the underlying product utilizing the licensed technology, the capitalized amount will be amortized over its estimated useful life. Indefinite-lived intangible assets are tested for impairment at least annually, in the fourth quarter, or more frequently if events or circumstances indicate that it is more likely than not that the asset is impaired. If the fair value of the asset is less than the carrying amount, an impairment loss would be recognized in an amount equal to the difference between the carrying amount and the fair value. Refer to Note “7. Intangible Assets” for more information on the Company’s intangible assets. Finite-lived intangible assets are amortized over the estimated economic useful lives of the assets, which is the period during which expected cash flows support the fair value of such intangible assets. The Company reviews finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets or asset group may not be recoverable. When such an event occurs, management determines whether there has been impairment by comparing the anticipated undiscounted future net cash flows to the related asset group’s carrying value. Refer to Note “7. Intangible Assets” for more information on the Company’s intangible assets.
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Goodwill | GoodwillGoodwill represents the excess of the purchase price of an acquired business or assets over the fair value of the identifiable assets acquired and liabilities assumed. Goodwill is not amortized, but is tested for impairment annually in the fourth quarter, or more frequently if events or circumstances indicate the carrying value may no longer be recoverable and that an impairment loss may have occurred. The Company operates as one segment, which is considered to be the sole reporting unit, and therefore goodwill is tested for impairment at the consolidated level. |
Revenue Recognition | Revenue Recognition Revenue is comprised of product revenue net of returns, discounts, administration fees and sales rebates. The Company adopted the guidance under ASC 606 on January 1, 2018 using the modified retrospective method for all contracts not completed as of the date of adoption. Therefore, the financial information for the year ended December 31, 2017 has not been adjusted and continues to be reported under ASC 605 with the impact of the adoption reflected in opening retained earnings in 2018. Under ASC 606, the Company recognizes revenue when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenue from product sales is recognized either on the date of shipment or the date of receipt by the customer, but is deferred for certain transactions when control has not yet transferred. With respect to products that the Company consigns to hospitals, which primarily consist of coils, the Company recognizes revenue at the time hospitals utilize products in a procedure. Deferred revenue represents amounts that the Company has already invoiced and are ultimately expected to be recognized as revenue, but for which not all revenue recognition criteria have been met. As of December 31, 2019 and December 31, 2018, respectively, the Company's deferred revenue balance was not material. Revenue is recorded at the net sales price, which includes estimates of variable consideration such as product returns utilizing historical return rates, rebates, discounts, and other adjustments to net revenue. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price. Variable consideration is included in revenue only to the extent that it is probable that a significant reversal of the revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The Company’s terms and conditions permit product returns and exchanges. The Company bases its estimates for sales returns on actual historical returns over the prior years and they are recorded as reductions in revenue at the time of sale. Upon recognition, the Company reduces revenue and cost of revenue for the estimated return. Return rates can fluctuate over time, but are sufficiently predictable to allow the Company to estimate expected future product returns. For more information and disclosures on the Company’s revenue, refer to Note “16. Revenues.”
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Shipping Costs | Shipping Costs Shipping and handling costs charged to customers are recorded as revenue. Shipping and handling costs are included in cost of revenue. |
Research and Development (R&D) Costs | Research and Development (“R&D”) Costs R&D costs primarily consist of product development, clinical and regulatory expenses, materials, depreciation and other costs associated with the development of the Company’s products. R&D costs also include related personnel and consultants’ salaries, benefits and related costs, including stock-based compensation. The Company expenses R&D costs as they are incurred. The Company’s clinical trial accruals are based on estimates of patient enrollment and related costs at clinical investigator sites. The Company estimates preclinical and clinical trial expenses based on the services performed pursuant to contracts with research institutions and clinical research organizations that conduct and manage preclinical studies and clinical trials on its behalf. In accruing service fees, the Company estimates the time period over which services will be performed and the level of patient enrollment and activity expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses until the services are rendered. Internal Use Software The Company capitalizes certain costs incurred for the development of computer software for internal use. These costs generally relate to third-party software as well as the internal development of software associated with our REAL Immersive System offerings. The Company capitalizes these costs when it is determined that it is probable that the project will be completed and the software will be used to perform the function intended, and the preliminary project stage is completed. Capitalized internal use software development costs are included in property and equipment, net within the consolidated balance sheets. Capitalized internal use software is amortized on a straight-line basis over its estimated useful life. For software that supports our REAL Immersive System, the amortization expense is recorded in cost of revenue within the consolidated statements of operations. Costs related to the preliminary project stage, post-implementation, training and maintenance are expensed as incurred.
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Advertising Costs | Advertising CostsAdvertising costs are included in sales, general and administrative expenses and are expensed as incurred. |
Stock-Based Compensation | Stock-Based Compensation The Company recognizes the cost of stock-based compensation in the financial statements based upon fair value. The fair value of restricted stock and restricted stock unit (“RSU”) awards is determined based on the number of units granted and the closing price of the Company’s common stock as of the grant date. The fair value of each purchase under the employee stock purchase plan (“ESPP”) is estimated at the beginning of the offering period using the Black-Scholes option pricing model. The fair value of stock options is determined as of the grant date using the Black-Scholes option pricing model. The Company’s determination of the fair value of equity-settled awards is impacted by the price of the Company’s common stock as well as changes in assumptions regarding a number of complex and subjective variables. These variables include, but are not limited to, the expected term that awards will remain outstanding, expected common stock price volatility over the term of the awards, risk-free interest rates and expected dividends. The fair value of an award is recognized over the requisite service period (usually the vesting period) on a straight-line basis. Stock-based compensation expense recognized at fair value includes the impact of estimated forfeitures. The Company estimates future forfeitures at the date of grant and revises the estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. To the extent actual forfeiture results differ from the estimates, the difference is recorded as a cumulative adjustment in the period forfeiture estimates are revised. No compensation cost is recorded for awards that do not vest. Prior to the adoption of Accounting Standard Update (“ASU”) No. 2018-07, “Compensation – Stock Compensation,” the Company recorded its equity instruments issued to non-employees at their fair value on the measurement date and were subject to periodic adjustments as the Company remeasured the fair value of the non-employee awards at each reporting period prior to vesting and at the vesting dates of each non-employee award. In the third quarter of 2018, the Company adopted ASU 2018-07 and recognizes the fair value of non-employee awards over the requisite service period (usually the vesting period) on a straight-line basis. Therefore, equity instruments issued to non-employees are recorded at their fair value on the grant date in the same manner as employee awards. The fair value of these equity instruments is expensed over the service period. Estimates of the fair value of equity-settled awards as of the grant date using valuation models, such as the Black-Scholes option pricing model, are affected by assumptions regarding a number of complex variables. Changes in the assumptions can materially affect the fair value of the award and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require significant analysis and judgment to develop. For all stock options granted prior to the Company’s IPO, the Company estimated the volatility data based on a study of publicly traded industry peer companies. For purposes of identifying these peer companies, the Company considered the industry, stage of development, size and financial leverage of potential comparable companies. The risk-free interest rate is based on the yield available on U.S. Treasury zero-coupon issues similar in duration to the expected term of the equity-settled award. For all stock options granted prior to the IPO, the Company used the Staff Accounting Bulletin, No. 110 (“SAB 110”) simplified method to calculate the expected term, which is the average of the contractual term and vesting period. For stock options granted post-IPO, the Company used its historical data to calculate the expected term and volatility used in the valuation of options.
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Income Taxes | Income Taxes The Company accounts for income taxes using the asset and liability method, whereby deferred tax asset (“DTA”) and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities, and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance to reduce the net DTAs to their estimated realizable value. The calculation of the Company’s current provision for income taxes involves the use of estimates, assumptions and judgments while taking into account current tax laws, interpretation of current tax laws and possible outcomes of future tax audits. The Company has established reserves to address potential exposures related to tax positions that could be challenged by tax authorities. Although the Company believes its estimates, assumptions and judgments to be reasonable, any changes in tax law or its interpretation of tax laws and the resolutions of potential tax audits could significantly impact the amounts provided for income taxes in the Company’s consolidated financial statements. The calculation of the Company’s DTA balance involves the use of estimates, assumptions and judgments while taking into account estimates of the amounts and type of future taxable income. Actual future operating results and the underlying amount and type of income could differ materially from the Company’s estimates, assumptions and judgments thereby impacting the Company’s financial position and results of operations. The Company follows the guidance relating to accounting for uncertainty in income taxes, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in the Company’s income tax return, and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure. The Company includes interest and penalties related to unrecognized tax benefits within income tax expense in the accompanying consolidated statements of operations.
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Comprehensive Income | Comprehensive Income Comprehensive income consists of net income, unrealized gains or losses on available-for-sale investments and the effects of foreign currency translation adjustments. The Company presents comprehensive income and its components in the consolidated statements of comprehensive (loss) income. |
Net Income (Loss) Per Share of Common Stock | Net Income (Loss) Per Share of Common Stock The Company’s basic net income (loss) attributable to Penumbra, Inc. per share is calculated by dividing the net income attributable to Penumbra, Inc. per share by the weighted average number of shares of common stock outstanding for the period. The diluted net income (loss) per share attributable to Penumbra, Inc. is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of this calculation, options to purchase common stock, restricted stock and restricted stock units are considered common stock equivalents.
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Leases | Leases The Company adopted the guidance under ASC Topic 842, “Leases” ("ASC 842") on January 1, 2019 using the modified retrospective transition approach. There was no cumulative-effect adjustment recorded to retained earnings upon adoption. Under ASC 842, the Company determines if an arrangement is a lease at inception. In addition, the Company determines whether leases meet the classification criteria of a finance or operating lease at the lease commencement date considering: (1) whether the lease transfers ownership of the underlying asset to the lessee at the end of the lease term, (2) whether the lease contains a bargain purchase option, (3) whether the lease term is for a major part of the remaining economic life of the underlying asset, (4) whether the present value of the sum of the lease payments and residual value guaranteed by the lessee equals or exceeds substantially all of the fair value of the underlying asset, and (5) whether the underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term. As of December 31, 2019, the Company's lease population consisted of operating and finance real estate, equipment and vehicle leases. As of the date of adoption of ASC 842 the Company did not have material finance leases. Operating leases are included in operating lease right-of-use assets, current operating lease liabilities, and non-current operating lease liabilities in our consolidated balance sheet. Finance leases are included in finance lease right-of-use assets, current finance lease liabilities, and non-current finance lease liabilities in our consolidated balance sheet. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, the Company uses its incremental borrowing rate which requires management’s judgement as the rate implicit in the lease is generally not readily determinable. The determination of the Company’s incremental borrowing rate requires management judgment including, the development of a synthetic credit rating and cost of debt as the Company currently does not carry any debt. The operating lease ROU assets also include adjustments for prepayments, accrued lease payments and exclude lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. Operating lease cost is recognized on a straight-line basis over the expected lease term. Finance lease cost is recognized as depreciation expense on a straight-line basis over the expected lease term and interest expense using the accelerated interest method of recognition. Lease agreements entered into after the adoption of ASC 842 that include lease and non-lease components are accounted for as a single lease component. Lease agreements with a non-cancelable term of less than 12 months are not recorded on the Company’s consolidated balance sheet.
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Recent Accounting Guidance and Recently Issued Accounting Standards | Recent Accounting Guidance Recently Adopted Accounting Standards On January 1, 2019, the Company adopted Accounting Standard Update (“ASU”) No. 2016-02, Leases (Topic 842), and its associated amendments using the modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application and not restating comparative periods. There was no cumulative-effect adjustment recorded to retained earnings upon adoption. Under the standard, a lessee is required to recognize a lease liability and ROU asset for all leases. The new guidance also modified the classification criteria and requires additional disclosures to enable users of financial statements to understand the amount, timing, and uncertainty of cash flows arising from leases. Consistent with current guidance, a lessee’s recognition, measurement, and presentation of expenses and cash flows arising from a lease continues to depend primarily on its classification. The Company elected the package of practical expedients permitted under the transition guidance, which allowed the Company to carryforward its historical lease classification, its assessment on whether a contract was or contains a lease, and its initial direct costs for any leases that existed prior to January 1, 2019. In addition, the Company elected the following transitional practical expedients: (1) the short-term lease exception and (2) to not separate its non-lease components for its real estate, vehicle and equipment leases. The impact of adoption and additional disclosures required by the ASU have been included in “Significant Accounting Policies - Leases” below and in Note “9. Leases.” Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-13, Financial Instruments—Credit Losses. The standard changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. In April 2019, the FASB issued ASU No. 2019-04 which provides additional clarification and addresses stakeholders’ specific issues about certain aspects of the amendments in the previously issued ASU No. 2016-13. In May 2019, the FASB issued ASU No. 2019-05 which further amends ASU No. 2016-13 by providing an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis. In November 2019, the FASB issued ASU No. 2019-11 which further provides additional clarification and addresses stakeholders’ specific issues about certain aspects of the amendments in the previously issued ASU No. 2016-13. The standard is effective for fiscal years and interim periods beginning after December 15, 2019. Early adoption is permitted for all periods beginning after December 15, 2018. The Company determined that it will apply the modified retrospective transition method and does not expect the adoption of this standard to have a material impact on its investments. Additionally, the Company is currently evaluating the impact of this standard on its trade receivables and related disclosures. In August 2018, the FASB issued ASU 2018-13, Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The primary focus of the standard is to improve the effectiveness of the disclosure requirements for fair value measurements. The standard is effective for fiscal years and interim periods beginning after December 15, 2019. An entity is permitted to early adopt the removed or modified disclosures upon the issuance of the standard and may delay adoption of the additional disclosures until their effective date. The Company is currently evaluating the impact of adopting this standard. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes— Simplifying the Accounting for Income Taxes. The standard intends to simplify and reduce the cost of accounting for income taxes. The new guidance removes certain exceptions for recognizing deferred taxes for foreign investments, the incremental approach to performing intraperiod allocation, and calculating income taxes in interim periods for year to date losses that exceed anticipated full year losses. The standard also adds guidance to reduce complexity in certain areas, including accounting for franchise taxes that are partially based on income, transactions with a government that result with a step up in the tax basis of goodwill, enacted changes in tax law during interim periods, and allocating taxes to members of a consolidated group which are not subject to tax. For public business entities, the amendments in ASU 2019-12 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted for all periods in which financial statements have not yet been issued, including interim periods. The Company is currently evaluating the impact of adopting the new guidance.
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Investments and Fair Value of Financial Instruments (Tables) |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Marketable Investments | The Company’s marketable investments have been classified and accounted for as available-for-sale. The Company’s marketable investments as of December 31, 2019 and 2018 were as follows (in thousands):
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Schedule of the Fair Value of Marketable Investments in an Unrealized Loss Position for Less than Twelve Months | The following tables present the gross unrealized losses and the fair value for those marketable investments that were in an unrealized loss position for less than and more than twelve months as of December 31, 2019 and 2018 (in thousands):
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Schedule of Contractual Maturities of Marketable Investments | The contractual maturities of the Company’s marketable investments as of December 31, 2019 and 2018 were as follows (in thousands):
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Schedule of Consideration Transferred in Asset Acquisition | The following table presents the components of the consideration transferred at fair value as of the Transfer Agreement Closing Date (amounts presented in thousands):
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Schedule of Fair Value of Assets and Liabilities | The following tables set forth the Company’s financial assets and liabilities measured at fair value by level within the fair value hierarchy (in thousands):
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Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis | The following table presents quantitative information about certain unobservable inputs used in the Level 3 fair value measurement of the Company’s contingent consideration liability, other than the forecasted revenues during the earn-out milestone period:
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Schedule of Contingent Consideration Obligation | The following table summarizes the changes in fair value of the contingent consideration obligation for the year ended December 31, 2019 (in thousands):
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Balance Sheet Components (Tables) |
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Dec. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Allowance for Doubtful Accounts | The Company’s allowance for doubtful accounts comprised of the following (in thousands):
(1) Represents the effect of currency translation adjustments and write-offs of uncollectible accounts, net of recoveries.
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Schedule of Inventories | The components of inventories consisted of the following (in thousands):
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Schedule of Property and Equipment, Net | Property and equipment, net consisted of the following (in thousands):
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Schedule of Accrued Liabilities | The following table shows the components of accrued liabilities as of December 31, 2019 and 2018 (in thousands):
(1) Acquisition-related costs consist of the current portion of contingent liabilities related to (1) the cash milestone payments and working capital adjustment liabilities for the acquisition of Crossmed and (2) an anti-dilution provision for the asset acquisition of MVI. Refer to Note “5. Business Combinations” for more information on the acquisition of Crossmed and Note “3. Investments and Fair Value of Financial Instruments” and Note “6. Asset Acquisition” for more information on the MVI asset acquisition.
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Schedule of Estimated Product Warranty Accrual | The following table shows the changes in the Company’s estimated product warranty accrual, included in accrued liabilities, as of December 31, 2019, 2018 and 2017 (in thousands):
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Other Noncurrent Liabilities | The following table shows the components of other non-current liabilities as of December 31, 2019 and 2018 (in thousands):
(1) Amount relates to the non-current liability recorded for probable future milestone payments to be made under the indefinite-lived intangible assets related to licensed technology described in Note “7. Intangible Assets.” Refer therein for more information.
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Business Combinations (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Purchase Price Allocation | The purchase price measurement period was closed as of June 30, 2018. For the periods ended December 31, 2019 and 2018, Crossmed results of operations were included in the consolidated statements of operations. The following table presents the allocation of the purchase price for Crossmed, reflecting the measurement period adjustments recorded in 2017 (in thousands):
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Pro Forma Information | The unaudited pro forma information is presented below (unaudited, in thousands):
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Intangible Assets (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Finite-lived Intangible Assets | The following table presents details of the Company’s acquired finite-lived and indefinite-lived intangible assets as of December 31, 2019 and 2018 (in thousands, except weighted-average amortization period):
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Schedule of Indefinite-lived Intangible Assets | The following table presents details of the Company’s acquired finite-lived and indefinite-lived intangible assets as of December 31, 2019 and 2018 (in thousands, except weighted-average amortization period):
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Finite-lived Intangible Assets Amortization Expense | The following table presents the amortization recorded related to the Company’s finite-lived intangible assets for the years ended December 31, 2019, 2018 and 2017 (in thousands):
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Schedule of Future Amortization Expense | As of December 31, 2019, expected amortization expense for the unamortized acquired intangible assets for the next five years and thereafter is as follows (in thousands):
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Goodwill (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Goodwill | The following table presents the changes in goodwill during the year ended December 31, 2019 (in thousands):
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Leases (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The impact of the adoption of ASC 842 on the Company’s consolidated balance sheet as of January 1, 2019 was as follows (in thousands):
(1) Upon the adoption of ASC 842, prepaid rent is included in the operating lease right-of-use assets. (2) Upon the adoption of ASC 842, current and non-current deferred rent is included in the current and non-current operating lease liabilities.
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Lease, Cost | The following table presents the components of the Company’s lease cost, lease term and discount rate during the year ended December 31, 2019 (in thousands, except years and percentages):
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Lessee, Operating Lease, Liability, Maturity | The following table is a schedule, by years, of maturities of the Company's operating and finance lease liabilities as of December 31, 2019 (in thousands):
(1) The table above excludes the estimated future minimum lease payment for the 1310 Harbor Bay Lease due to uncertainty around the timing of when the 1310 Harbor Bay Lease will commence and payments will be due. The total estimated lease payments over the year lease term will be calculated based on the total development costs incurred in connection with the development of the building which will be determined upon substantial completion of the building.
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Finance Lease, Liability, Maturity | The following table is a schedule, by years, of maturities of the Company's operating and finance lease liabilities as of December 31, 2019 (in thousands):
(1) The table above excludes the estimated future minimum lease payment for the 1310 Harbor Bay Lease due to uncertainty around the timing of when the 1310 Harbor Bay Lease will commence and payments will be due. The total estimated lease payments over the year lease term will be calculated based on the total development costs incurred in connection with the development of the building which will be determined upon substantial completion of the building.
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Schedule of Future Minimum Lease Payments under Operating Leases | The following table below shows the maturities of the Company’s operating lease liabilities previously disclosed under ASC 840 as of December 31, 2018 (in thousands):
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Schedule of Cash Flow, Supplemental Disclosures | Supplemental cash flow information related to leases during the year ended December 31, 2019 are as follows (in thousands):
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Stockholders' Equity (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Share-based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Stock Option Activity | Activity of stock options under the 2005 Plan, 2011 Plan and 2014 Plan (collectively, the "Plans") is set forth below:
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Summary of Unvested Restricted Stock Activity | The activity of unvested restricted stock and restricted stock units ("RSU") under the Plans is set forth below:
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Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The Company used the following assumptions in its Black-Scholes option pricing model to determine the fair value of stock options granted in 2019:
The Company did not grant stock options during the years ended December 31, 2018 and 2017. The Company used the following assumptions in its Black-Scholes option pricing model to determine the fair value of ESPP rights:
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Schedule of Stock-based Compensation Expense | The following table sets forth the stock-based compensation expense included in the consolidated statements of operations (in thousands):
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Accumulated Other Comprehensive Loss (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table summarizes the changes in the accumulated balances during the period, and includes information regarding the manner in which the reclassifications out of accumulated other comprehensive loss into earnings affect our consolidated statements of comprehensive income (loss) (in thousands):
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Income Taxes (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Income or (Loss) before Income Taxes | Income (loss) before income taxes and equity in losses of unconsolidated investee for the years ended December 31, 2019, 2018 and 2017 is summarized as follows (in thousands):
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Components of the Provision for (Benefit from) Income Taxes | The components of the (benefit from) provision for income taxes are summarized as follows (in thousands):
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Schedule of Effective Income Tax Reconciliation | The Company’s actual (benefit from) or provision for tax differed from the amounts computed by applying the Company’s U.S. federal statutory income tax rate to pretax income as a result of the following:
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Schedule of Deferred Tax Assets and Liabilities | Deferred income tax assets and liabilities consist of the following (in thousands):
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Summary of Valuation Allowance | The change in the Company’s deferred tax valuation allowance against net DTAs from January 1, 2017 to December 31, 2019, is as follows (in thousands):
(1) Additions include current year additions charged to expenses and current year build due to increases in net DTAs, return to provision true-ups, and other adjustments. (2) Deductions include current year releases credited to expenses and current year reductions due to decreases in net DTAs, return to provision true-ups, and other adjustments.
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Schedule of Unrecognized Tax Benefits | A reconciliation of the change in the gross unrecognized tax benefits from January 1, 2017 to December 31, 2019, is as follows (in thousands):
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Net Income Attributable to Penumbra, Inc. per Share (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of the Numerator and Denominator used in the Calculation of the Basic and Diluted Earnings per Share | A reconciliation of the numerator and denominator used in the calculation of the basic and diluted net income attributable to Penumbra, Inc. is as follows (in thousands, except share and per share amounts):
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Revenues (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | The Company’s revenues, disaggregated by geography, based on the destination to which the Company ships its products, for the years ended December 31, 2019, 2018 and 2017 was as follows (in thousands):
The Company’s revenues disaggregated by product category, for the years ended December 31, 2019, 2018 and 2017 was as follows (in thousands):
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Selected Quarterly Financial Data (Unaudited) (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Quarterly Financial Information | The following tables provide the selected quarterly financial data for 2019 and 2018 (in thousands, except share and per share amounts):
(1) In first quarter of 2019, the Company adopted Accounting Standard Update (“ASU”) No. 2016-02, Leases (Topic 842), and its associated amendments. Under the standard, a lessee will be required to recognize a lease liability and right-of-use asset for all leases with terms in excess of twelve months. The Company elected to apply the modified retrospective transition approach to all leases existing at the date of initial application and not restate comparative periods. In addition, the Company elected the following transitional practical expedients: (1) the short-term lease exception and (2) to not separate its non-lease components for its real estate, vehicle and equipment leases. As a result of the adoption, there was no cumulative-effect adjustment recorded to retained earnings upon adoption. Refer to Note “2. Summary of Significant Accounting Policies” and Note “9. Leases” for more information. (2) In the first quarter of 2018, the Company adopted Accounting Standard Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (“Topic 606”), and its associated amendments. Under the standard, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. The Company applied the five step method outlined in the ASU to all revenue streams and elected to utilize the modified retrospective implementation method. As a result of adoption, the Company recorded a $0.3 million cumulative adjustment to its retained earnings at January 1, 2018. Refer to Note “2. Summary of Significant Accounting Policies” and Note “16. Revenues” for more information. (3) On August 31, 2018, the Company acquired a controlling interest in MVI which was accounted for as an asset acquisition. In connection with the transaction, the Company recorded a $30.8 million IPR&D charge during the three months ended September 30, 2018 in the consolidated statements of operations related to the acquired technology under development from MVI. Of the total IPR&D charge, $27.4 million was attributable to the net loss of Penumbra, Inc.
|
Investments and Fair Value of Financial Instruments - Contractual Maturities of Marketable Investments (Details) - USD ($) $ in Thousands |
Dec. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Due in less than one year | $ 51,990 | $ 83,391 |
Due in one to five years | 64,620 | 49,648 |
Fair Value | $ 116,610 | $ 133,039 |
Investments and Fair Value of Financial Instruments - Non-Marketable Equity Investments (Details) - USD ($) |
3 Months Ended | 8 Months Ended | 12 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 |
Dec. 31, 2019 |
Sep. 30, 2019 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Aug. 31, 2018 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Revenues | $ 145,263,000 | $ 139,502,000 | $ 134,201,000 | $ 128,439,000 | $ 120,793,000 | $ 111,806,000 | $ 109,638,000 | $ 102,701,000 | $ 547,405,000 | $ 444,938,000 | $ 333,764,000 | ||
Fair value of the remaining non-controlling interest | 3,366,000 | ||||||||||||
Acquired in-process research and development | 0 | 30,835,000 | $ 0 | $ 0 | $ 0 | 30,835,000 | $ 0 | ||||||
MVI Health Inc. | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Equity method ownership percentage | 50.00% | 50.00% | |||||||||||
Revenues | $ 0 | ||||||||||||
Equity method investment, net income (loss) | (6,200,000) | ||||||||||||
Assets | $ 5,200,000 | $ 7,900,000 | 5,200,000 | $ 7,900,000 | |||||||||
Liabilities of investment | 1,000,000.0 | 1,000,000.0 | |||||||||||
Equity of investment | $ 4,200,000 | $ 4,200,000 | |||||||||||
MVI Health Inc. | |||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||
Asset acquisition, percentage of additional interest acquired | 40.00% | 40.00% | |||||||||||
Cash transferred | $ 20,000,000.0 | ||||||||||||
Loss contingency accrual | $ 4,500,000 | $ 4,500,000 | |||||||||||
Asset acquisition, ownership percentage | 90.00% | 90.00% | |||||||||||
Remaining equity interest | 10.00% | 10.00% | |||||||||||
Carrying amount of Penumbra’s equity method investment in MVI | $ 2,202,000 | $ 2,202,000 | |||||||||||
Fair value of the remaining non-controlling interest | 3,365,000 | ||||||||||||
Acquired in-process research and development | $ 30,800,000 | $ 30,800,000 |
Investments and Fair Value of Financial Instruments - Impact of Transfer Agreement on Non-Marketable Equity Investments (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Aug. 31, 2018 |
Dec. 31, 2018 |
|
Schedule of Asset Acquisition [Line Items] | ||
Fair value of the remaining non-controlling interest | $ 3,366 | |
MVI Health Inc. | ||
Schedule of Asset Acquisition [Line Items] | ||
Cash transferred | $ 20,000 | |
Anti-dilution protection at Transfer Agreement Closing Date | 4,500 | |
Carrying amount of Penumbra’s equity method investment in MVI | 2,202 | |
Fair value of the remaining non-controlling interest | 3,365 | |
Total consideration transferred | $ 30,067 |
Investments and Fair Value of Financial Instruments - Contingent Consideration (Details) - Crossmed - USD ($) |
12 Months Ended | |
---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Changes in fair value | $ 0 | $ 1,000,000.0 |
Fair Value, Inputs, Level 3 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | 2,571,000 | 4,675,000 |
Payments of contingent consideration liabilities | (1,296,000) | (3,017,000) |
Changes in fair value | (35,000) | 950,000 |
Foreign currency remeasurement | (34,000) | (37,000) |
Ending balance | 1,206,000 | $ 2,571,000 |
Fair Value, Inputs, Level 3 | Monte Carlo Simulation | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Ending balance | $ 1,200,000 |
Balance Sheet Components - Accounts Receivable, Net (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Balance At Beginning Of Year | $ 2,782 | $ 1,290 | $ 684 |
Charged To Costs And Expenses | 656 | 1,563 | 606 |
Deductions | (492) | (71) | 0 |
Balance At End Of Year | $ 2,946 | $ 2,782 | $ 1,290 |
Balance Sheet Components - Inventories (Details) - USD ($) $ in Thousands |
Dec. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 21,646 | $ 18,829 |
Work in process | 21,651 | 10,630 |
Finished goods | 109,695 | 86,282 |
Inventories | $ 152,992 | $ 115,741 |
Balance Sheet Components - Accrued Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2019 |
Jan. 01, 2019 |
Dec. 31, 2018 |
---|---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Payroll and employee-related expenses | $ 37,727 | $ 33,838 | |
Accrued expenses | 7,811 | 4,088 | |
Sales return reserve | 1,821 | 2,986 | |
Product warranty | 2,318 | 1,875 | |
Contingent consideration & other acquisition related costs | 4,291 | 4,439 | |
Other accrued liabilities | 13,662 | 10,660 | |
Total accrued liabilities | $ 67,630 | $ 57,754 | $ 57,886 |
Balance Sheet Components - Product Warranty (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Product Warranty, Increase (Decrease) [Roll Forward] | |||
Balance at the beginning of the year | $ 1,875 | $ 1,088 | $ 1,254 |
Accruals of warranties issued | 1,065 | 1,336 | 471 |
Settlements of warranty claims | (622) | (549) | (637) |
Balance at the end of the year | $ 2,318 | $ 1,875 | $ 1,088 |
Balance Sheet Components - Other Non-Current Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Other Non-Current Liabilities Disclosure [Abstract] | ||
Deferred tax liabilities | $ 4,005 | $ 4,171 |
Licensing-related cost | 10,878 | 11,506 |
Other non-current liabilities | 367 | 3,266 |
Other non-current liabilities | $ 15,250 | $ 18,943 |
Business Combinations - Narrative (Details) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2019
USD ($)
segment
|
Dec. 31, 2018
USD ($)
|
Dec. 31, 2017
USD ($)
|
Jul. 03, 2017
USD ($)
|
|
Business Combinations [Abstract] | ||||
Number of operating segments | segment | 1 | |||
Business Acquisition [Line Items] | ||||
Payment of milestone payments, financing activities | $ 1,758 | $ 4,481 | $ 0 | |
Crossmed | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration arrangements, maximum | no | no | ||
Payments of milestone payments | $ 1,300 | |||
Payment of milestone payments, financing activities | 700 | $ 4,500 | ||
Payment of milestone payments, operating activities | 600 | |||
Deferred tax liability | $ 2,500 | |||
Current Liabilities | Crossmed | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration for milestone payments | $ 1,200 | 2,600 | ||
Milestone Achievement Payment | Crossmed | ||||
Business Acquisition [Line Items] | ||||
Payment of milestone payments, financing activities | $ 3,000 |
Business Combinations - Pro Forma (Details) - Crossmed $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2017
USD ($)
| |
Business Acquisition [Line Items] | |
Pro forma net revenue | $ 336,557 |
Pro forma net income | $ 5,992 |
Asset Acquisition (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Schedule of Asset Acquisition [Line Items] | |||
Proceeds from capital contribution from non-controlling interest | $ 800 | $ 500 | $ 0 |
MVI Asset Acquisition | |||
Schedule of Asset Acquisition [Line Items] | |||
Payments made for anti-dilution provision | 1,000 | 500 | |
Cash payments made | 800 | ||
Noncash payments made for anti-dilution provision | 200 | ||
Current loss contingency accrual | $ 3,000 | 1,500 | |
Noncurrent loss accrual | $ 2,500 |
Intangible Assets - Future Amortization (Details) - USD ($) $ in Thousands |
Dec. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2020 | $ 1,053 | |
2021 | 1,053 | |
2022 | 881 | |
2023 | 709 | |
2024 | 709 | |
Thereafter | 6,759 | |
Net | $ 11,164 | $ 12,366 |
Goodwill (Details) - USD ($) |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2019 |
|
Goodwill [Roll Forward] | |||
Balance as of December 31, 2018 | $ 7,813,000 | ||
Foreign currency translation adjustments | (157,000) | ||
Balance as of December 31, 2019 | $ 7,656,000 | $ 7,813,000 | $ 7,656,000 |
Goodwill impairment | $ 0 | $ 0 |
Leases - Narrative (Details) - USD ($) $ in Millions |
12 Months Ended | ||||
---|---|---|---|---|---|
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2019 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|
Lessee, Lease, Description [Line Items] | |||||
Rent expense | $ 5.8 | $ 5.8 | |||
1310 Harbor Bay Lease | |||||
Lessee, Lease, Description [Line Items] | |||||
Operating lease, lease not yet commenced, term of contract | 15 years | ||||
Roseville Lease | |||||
Lessee, Lease, Description [Line Items] | |||||
Operating lease, lease not yet commenced, term of contract | 15 years | ||||
Minimum | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease, renewal term | 5 years | ||||
Maximum | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease, renewal term | 15 years |
Leases - Summary of Lease Cost (Details) $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2019
USD ($)
| |
Leases [Abstract] | |
Operating lease cost | $ 7,293 |
Amortization of right-of-use assets | 284 |
Interest on lease liabilities | 186 |
Variable lease cost | 3,570 |
Total lease costs | $ 11,333 |
Operating lease, weighted average remaining lease term | 10 years |
Finance lease, weighted average remaining lease term | 15 years |
Operating lease, weighted average discount rate | 6.20% |
Finance lease, weighted average discount rate | 5.42% |
Leases - Schedule of Maturity of Lease Liabilities (Details) $ in Thousands |
Dec. 31, 2019
USD ($)
|
---|---|
Lessee, Operating Lease, Description [Abstract] | |
2020 | $ 7,189 |
2021 | 6,817 |
2022 | 6,637 |
2023 | 6,464 |
2024 | 6,325 |
Thereafter | 36,444 |
Total undiscounted lease payments | 69,876 |
Less imputed interest | (18,492) |
Present value of lease liabilities | 51,384 |
Lessee, Finance Lease, Description [Abstract] | |
2020 | 5,705 |
2021 | 2,473 |
2022 | 2,489 |
2023 | 2,538 |
2024 | 2,588 |
Thereafter | 28,585 |
Total undiscounted lease payments | 44,378 |
Less imputed interest | (13,465) |
Present value of lease liabilities | $ 30,913 |
Leases - Schedule of Lease Payments Under Previous Guidance (Details) $ in Thousands |
Dec. 31, 2018
USD ($)
|
---|---|
Leases [Abstract] | |
2019 | $ 6,575 |
2020 | 6,571 |
2021 | 5,809 |
2022 | 5,772 |
2023 | 5,735 |
Thereafter | 40,194 |
Total estimated lease payments | $ 70,656 |
Leases - Supplemental Cash Flow Information (Details) $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2019
USD ($)
| |
Leases [Abstract] | |
Operating cash flows from operating leases | $ 6,829 |
Financing cash flows from finance leases | 2,570 |
Right-of-use asset obtained in exchange for lease obligations, operating leases | 4,261 |
Right-of-use asset obtained in exchange for lease obligations, finance leases | $ 33,283 |
Stockholders' Equity - Preferred Stock and Common Stock (Details) $ in Millions |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2018
USD ($)
shares
|
Dec. 31, 2019
vote
shares
|
Jun. 30, 2019
shares
|
Dec. 31, 2018
shares
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 | ||
Preferred stock, shares outstanding (in shares) | 0 | 0 | 0 | |
Common stock, number of votes per share | vote | 1 | |||
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares issued in connection with Buyout Agreement | 53,256 | |||
Fair value of shares issued | $ | $ 5.3 |
Stockholders' Equity - Issuance of Stock (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Mar. 31, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Class of Stock [Line Items] | |||
Net cash proceeds from shares issued and sold | $ 5,256 | $ 106,269 | |
Public Stock Offering | |||
Class of Stock [Line Items] | |||
Shares issued (in shares) | 1,495,000 | ||
Shares issued, price per share (in dollars per share) | $ 76.00 | ||
Net cash proceeds from shares issued and sold | $ 106,300 | ||
Underwriting discounts and commissions | 6,800 | ||
Other issuance costs | $ 500 |
Stockholders' Equity - Restricted Stock Activity (Details) - Restricted Stock and Restricted Stock Units (RSUs) |
12 Months Ended |
---|---|
Dec. 31, 2019
$ / shares
shares
| |
Number of Shares | |
Unvested beginning balance (in shares) | shares | 451,463 |
Granted (in shares) | shares | 261,071 |
Vested (in shares) | shares | (297,788) |
Cancelled/Forfeited (in shares) | shares | (43,540) |
Unvested ending balance (in shares) | shares | 371,206 |
Weighted Average Grant Date Fair Value | |
Unvested beginning balance (in dollars per share) | $ / shares | $ 57.29 |
Granted (in dollars per share) | $ / shares | 151.44 |
Vested (in dollars per share) | $ / shares | 44.11 |
Cancelled/Forfeited (in dollars per share) | $ / shares | 88.16 |
Unvested ending balance (in dollars per share) | $ / shares | $ 130.47 |
Stockholders' Equity - Stock Options Assumptions (Details) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 6 years 10 months 20 days | ||
Expected volatility (percent) | 40.00% | ||
Risk-free interest rate | 1.82% | ||
Expected dividend rate (percent) | 0.00% | ||
Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 6 months | 6 months | |
Expected volatility (percent) | 45.00% | 42.00% | 34.00% |
Risk-free interest rate | 2.30% | 2.36% | 1.26% |
Expected dividend rate (percent) | 0.00% | 0.00% | 0.00% |
Stockholders' Equity - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 21,485 | $ 18,422 | $ 17,812 |
Cost of sales | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 1,396 | 1,004 | 1,009 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 2,835 | 1,597 | 1,289 |
Sales, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 17,254 | $ 15,821 | $ 15,514 |
Employee Benefit Plan (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Retirement Benefits [Abstract] | |||
Employer contribution cost | $ 3.2 | $ 1.6 | $ 1.1 |
Income Taxes - Income (Loss) before Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2019 |
Sep. 30, 2019 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Income Tax Disclosure [Abstract] | |||||||||||
United States | $ 46,859 | $ (2,790) | $ 543 | ||||||||
Foreign | 3,276 | 4,398 | 1,933 | ||||||||
Income before income taxes and equity in losses of unconsolidated investee | $ 11,749 | $ 12,963 | $ 13,514 | $ 11,909 | $ 7,349 | $ (19,908) | $ 9,663 | $ 4,504 | $ 50,135 | $ 1,608 | $ 2,476 |
Income Taxes - Provision for (Benefit from) for Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2019 |
Sep. 30, 2019 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Current: | |||||||||||
Federal | $ (738) | $ 290 | $ (13) | ||||||||
State | 34 | 183 | 259 | ||||||||
Foreign | 2,458 | 1,689 | 739 | ||||||||
Total current | 1,754 | 2,162 | 985 | ||||||||
Deferred: | |||||||||||
Federal | 1,556 | (5,436) | (2,502) | ||||||||
State | 295 | (770) | (1,742) | ||||||||
Foreign | (474) | (359) | (352) | ||||||||
Total deferred | 1,377 | (6,565) | (4,596) | ||||||||
(Benefit from) Provision for Income Taxes | $ 2,448 | $ 1,963 | $ (2,735) | $ 1,455 | $ 885 | $ 1,598 | $ (4,948) | $ (1,938) | $ 3,131 | $ (4,403) | $ (3,611) |
Income Taxes - Effective Income Tax Reconciliation (Details) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Income Tax Disclosure [Abstract] | |||
Income tax at federal statutory rate | 21.00% | 21.00% | 34.00% |
State income taxes, net of federal benefit | 0.40% | (33.10%) | (94.60%) |
Foreign taxes differential | 2.20% | 37.20% | (4.20%) |
Prepaid tax ASC 810-10 | (0.80%) | 5.00% | (39.80%) |
IPR&D charge | 0.00% | 402.50% | 0.00% |
Stock-based compensation | (20.80%) | (809.60%) | (802.00%) |
Non-deductible meals and entertainment | 1.60% | 31.30% | 19.40% |
Imputed interest | 0.60% | 19.80% | 19.10% |
Tax credits | 0.00% | 0.00% | (0.50%) |
Remeasurement of deferred tax assets and liabilities | 0.00% | 0.00% | 622.50% |
Transfer pricing tax benefit | 0.00% | 0.00% | (35.30%) |
Global intangible low-taxed income ("GILTI") | 0.80% | 14.00% | 0.00% |
Contingent liabilities | 0.00% | 12.40% | 0.00% |
Executive compensation | 0.40% | 6.50% | 0.00% |
Non-deductible expenses | 0.00% | 15.30% | 0.00% |
Other | 0.80% | 3.90% | 8.00% |
Change in valuation allowance | 0.00% | 0.00% | 127.60% |
Effective tax rate | 6.20% | (273.80%) | (145.80%) |
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2019 |
Jun. 30, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|---|---|---|
Deferred tax assets: | |||||
Net operating loss carryforwards | $ 24,470 | $ 27,456 | |||
Tax credits | 15,992 | 11,459 | |||
Accruals and reserves | 4,700 | 6,078 | |||
Stock-based compensation | 4,252 | 3,485 | |||
Translation adjustment | 155 | 527 | |||
UNICAP adjustments | 6,816 | 4,993 | |||
ASC 842 Lease Liabilities | 20,183 | ||||
Other | 471 | 464 | |||
Gross deferred tax assets | 77,039 | 54,462 | |||
Valuation allowance | (21,558) | (17,284) | $ (17,284) | $ (10,295) | $ (6,062) |
Total deferred tax assets | 55,481 | 37,178 | |||
Deferred tax liabilities: | |||||
Depreciation and amortization | (5,550) | (6,293) | |||
Unrealized Gains | (73) | $ 0 | |||
ASC 842 Lease ROU Assets | (20,394) | ||||
Total deferred tax liabilities | (26,017) | (6,293) | |||
Net deferred tax assets | $ 29,464 | $ 30,885 |
Income Taxes - Operating Loss Carryforwards (Details) $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2019
USD ($)
| |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards, limited to offset taxable income in year utilized, percent | 80.00% |
Federal | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | $ 89.3 |
Operating loss carryforwards, indefinite lived | $ 24.0 |
Operating loss carryforwards, carryforward period | 20 years |
State | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | $ 78.6 |
Foreign | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | $ 0.4 |
Income Taxes - Tax Credit Carryforwards (Details) $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2019
USD ($)
| |
MVI Health Inc. | |
Tax Credit Carryforward [Line Items] | |
Asset Acquisition MVI DTA | $ 3.1 |
Research Tax Credit | Federal | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | $ 9.2 |
Period for which credits are carried forward | 20 years |
Research Tax Credit | State | |
Tax Credit Carryforward [Line Items] | |
Tax credit carryforwards | $ 10.5 |
Federal | |
Tax Credit Carryforward [Line Items] | |
Operating loss carryforwards, carryforward period | 20 years |
Income Taxes - Valuation Allowance (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Reconciliation of valuation allowance | |||
Beginning Balance | $ 17,284 | $ 10,295 | $ 6,062 |
Additions Charged To Expenses or Other Accounts | 4,395 | 6,989 | 4,400 |
Deductions Credited to Expenses or Other Accounts | (121) | 0 | (167) |
Ending Balance | $ 21,558 | $ 17,284 | $ 10,295 |
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands |
12 Months Ended | |||||
---|---|---|---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Reconciliation of the change in gross unrecognized tax benefits | ||||||
Beginning balance | $ 5,174 | $ 4,152 | $ 3,827 | |||
Gross increase for tax positions of current year | 1,191 | 1,421 | 871 | |||
Gross increase for tax positions of prior years | 386 | 238 | 130 | |||
Gross decrease for tax positions of prior years | (565) | (616) | (659) | |||
Settlement | 0 | 0 | 0 | |||
Lapse of statute of limitations | (111) | (21) | (17) | |||
Ending balance | 6,075 | 5,174 | 4,152 | |||
Accrued interest and penalties related to uncertain tax positions | $ 200 | $ 200 | $ 100 | |||
Unrecognized tax benefits | $ 6,075 | $ 4,152 | $ 4,152 | 6,075 | $ 5,174 | $ 4,152 |
Unrecognized tax benefits that would affect the effective tax rate if recognized | $ 1,900 |
Net Income Attributable to Penumbra, Inc. per Share - Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2019 |
Sep. 30, 2019 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Numerator: | |||||||||||
Net income (loss) attributable to Penumbra, Inc. | $ 9,689 | $ 11,483 | $ 16,588 | $ 10,698 | $ 6,659 | $ (18,930) | $ 13,381 | $ 5,491 | $ 48,458 | $ 6,601 | $ 4,657 |
Denominator: | |||||||||||
Weighted average shares outstanding: Basic (in shares) | 34,955,043 | 34,840,370 | 34,694,228 | 34,507,279 | 34,378,415 | 34,248,484 | 34,072,223 | 33,846,142 | 34,750,706 | 34,138,176 | 32,978,065 |
Potential dilutive common stock securities, as calculated using treasury stock method (in shares) | 1,515,293 | 1,948,645 | 2,341,038 | ||||||||
Weighted average shares outstanding: Diluted (in shares) | 36,312,471 | 36,271,394 | 36,214,321 | 36,213,164 | 36,150,450 | 34,248,484 | 36,116,254 | 35,917,051 | 36,265,999 | 36,086,821 | 35,319,103 |
Net income (loss) attributable to Penumbra, Inc. per share: Basic (in dollars per share) | $ 0.28 | $ 0.33 | $ 0.48 | $ 0.31 | $ 0.19 | $ (0.55) | $ 0.39 | $ 0.16 | $ 1.39 | $ 0.19 | $ 0.14 |
Net income (loss) attributable to Penumbra, Inc. per share: Diluted (in dollars per share) | $ 0.27 | $ 0.32 | $ 0.46 | $ 0.30 | $ 0.18 | $ (0.55) | $ 0.37 | $ 0.15 | $ 1.34 | $ 0.18 | $ 0.13 |
Net Income Attributable to Penumbra, Inc. per Share - Antidilutive Securities (Details) - shares shares in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Class of Stock [Line Items] | |||
Antidilutive securities excluded from the computation of earnings per share (in shares) | 49 | 54 | |
Employee Stock Purchase Plan | |||
Class of Stock [Line Items] | |||
Antidilutive securities excluded from the computation of earnings per share (in shares) | 100 |
Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2019 |
Sep. 30, 2019 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Jan. 01, 2018 |
|||
Disaggregation of Revenue [Line Items] | ||||||||||||||
Revenues | $ 145,263 | $ 139,502 | $ 134,201 | $ 128,439 | $ 120,793 | $ 111,806 | $ 109,638 | $ 102,701 | $ 547,405 | $ 444,938 | $ 333,764 | |||
Cumulative effect adjustments | $ 467 | |||||||||||||
Neuro | ||||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||||
Revenues | 331,685 | 294,333 | 232,446 | |||||||||||
Vascular | ||||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||||
Revenues | 215,720 | 150,605 | 101,318 | |||||||||||
United States | ||||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||||
Revenues | 355,222 | 290,716 | 219,173 | |||||||||||
Japan | ||||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||||
Revenues | 42,520 | 41,805 | 33,790 | |||||||||||
Other International | ||||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||||
Revenues | $ 149,663 | $ 112,417 | $ 80,801 | |||||||||||
Retained Earnings (Accumulated Deficit) | ||||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||||
Cumulative effect adjustments | [1] | 467 | ||||||||||||
Retained Earnings (Accumulated Deficit) | Accounting Standards Update 2014-09 | ||||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||||
Cumulative effect adjustments | $ 300 | |||||||||||||
|
Selected Quarterly Financial Data (Unaudited) - Selected Statement of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2019 |
Sep. 30, 2019 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 145,263 | $ 139,502 | $ 134,201 | $ 128,439 | $ 120,793 | $ 111,806 | $ 109,638 | $ 102,701 | $ 547,405 | $ 444,938 | $ 333,764 |
Cost of revenue | 47,135 | 43,504 | 40,273 | 44,529 | 42,081 | 36,794 | 37,386 | 36,144 | 175,441 | 152,405 | 116,622 |
Gross Profit | 98,128 | 95,998 | 93,928 | 83,910 | 78,712 | 75,012 | 72,252 | 66,557 | 371,964 | 292,533 | 217,142 |
Acquired in-process research and development | 0 | 30,835 | 0 | 0 | 0 | 30,835 | 0 | ||||
Total operating expenses | 87,549 | 83,022 | 81,127 | 72,758 | 72,043 | 95,861 | 62,969 | 62,512 | 324,456 | 293,385 | 215,977 |
Income (loss) before income taxes and equity in losses of unconsolidated investee | 11,749 | 12,963 | 13,514 | 11,909 | 7,349 | (19,908) | 9,663 | 4,504 | 50,135 | 1,608 | 2,476 |
Provision for (benefit from) income taxes | 2,448 | 1,963 | (2,735) | 1,455 | 885 | 1,598 | (4,948) | (1,938) | 3,131 | (4,403) | (3,611) |
Income before equity in losses of unconsolidated investee | 6,464 | (21,506) | 14,611 | 6,442 | 47,004 | 6,011 | 6,087 | ||||
Equity in losses of unconsolidated investee | 0 | (920) | (1,230) | (951) | 0 | (3,101) | (1,430) | ||||
Consolidated net income (loss) | 9,301 | 11,000 | 16,249 | 10,454 | 6,464 | (22,426) | 13,381 | 5,491 | 47,004 | 2,910 | 4,657 |
Net loss attributable to non-controlling interest | (388) | (483) | (339) | (244) | (195) | (3,496) | 0 | 0 | (1,454) | (3,691) | 0 |
Net income (loss) attributable to Penumbra, Inc. | $ 9,689 | $ 11,483 | $ 16,588 | $ 10,698 | $ 6,659 | $ (18,930) | $ 13,381 | $ 5,491 | $ 48,458 | $ 6,601 | $ 4,657 |
Net income (loss) attributable to Penumbra, Inc. per share: Basic (in dollars per share) | $ 0.28 | $ 0.33 | $ 0.48 | $ 0.31 | $ 0.19 | $ (0.55) | $ 0.39 | $ 0.16 | $ 1.39 | $ 0.19 | $ 0.14 |
Net income (loss) attributable to Penumbra, Inc. per share: Diluted (in dollars per share) | $ 0.27 | $ 0.32 | $ 0.46 | $ 0.30 | $ 0.18 | $ (0.55) | $ 0.37 | $ 0.15 | $ 1.34 | $ 0.18 | $ 0.13 |
Weighted average shares outstanding: Basic (in shares) | 34,955,043 | 34,840,370 | 34,694,228 | 34,507,279 | 34,378,415 | 34,248,484 | 34,072,223 | 33,846,142 | 34,750,706 | 34,138,176 | 32,978,065 |
Weighted average shares outstanding: Diluted (in shares) | 36,312,471 | 36,271,394 | 36,214,321 | 36,213,164 | 36,150,450 | 34,248,484 | 36,116,254 | 35,917,051 | 36,265,999 | 36,086,821 | 35,319,103 |
Selected Quarterly Financial Data (Unaudited) - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
Jan. 01, 2018 |
|||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Cumulative effect adjustments | $ 467 | ||||||||||
Acquired in-process research and development | $ 0 | $ 30,835 | $ 0 | $ 0 | $ 0 | $ 30,835 | $ 0 | ||||
Retained Earnings (Accumulated Deficit) | |||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Cumulative effect adjustments | [1] | 467 | |||||||||
Accounting Standards Update 2014-09 | Retained Earnings (Accumulated Deficit) | |||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Cumulative effect adjustments | $ 300 | ||||||||||
MVI Health Inc. | |||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Acquired in-process research and development | $ 30,800 | 30,800 | |||||||||
Penumbra, Inc. | |||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Acquired in-process research and development | $ 27,400 | ||||||||||
|
Label | Element | Value | ||
---|---|---|---|---|
Parent [Member] | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 467,000 | [1] | |
|