Quarterly report pursuant to Section 13 or 15(d)

NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

v3.10.0.1
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
9 Months Ended
Sep. 30, 2018
Accounting Policies [Abstract]  
Summary of Fair Value Assumptions
The principal assumptions used in applying the model were as follows:
Assumptions:
For Three and Nine Months Ended September 30, 2018
Risk-free interest rate
2.3% - 2.5%
Expected life
1.8 - 2.2 Years
Expected volatility
65% - 70%
Dividends
0.0%
Schedule of Earnings Per Share, Basic and Diluted
Diluted net income (loss) per common share is based on the weighted-average number of common shares outstanding and potentially dilutive common shares outstanding and computed as follows:
 
Three Months Ended
September 30,
 
Nine Months Ended September 30,
 
2018
 
2017
 
2018
 
2017
 
(In thousands, except share and per share data)
Numerator:
 
 
 
 
 
 
 
Net income (loss) to common stockholders
$
(7,619
)
 
$
(4,237
)
 
$
27,713

 
$
4,958

 
 
 
 
 
 
 
 
Denominator:
 
 
 
 
 
 
 
Weighted-average common shares, basic
27,247,462

 
27,327,936

 
27,488,437

 
24,588,296

Weighted-average common shares, diluted*
27,247,462

 
27,327,936

 
28,417,453

 
26,138,201

Net income (loss) per common share:
 
 
 
 

 

Basic:
$
(0.28
)
 
$
(0.16
)
 
$
1.01

 
$
0.20

Diluted:
$
(0.28
)
 
$
(0.16
)
 
$
0.98

 
$
0.19

* The diluted earnings per common share included the weighted average effect of 209,689 unvested RSU's and 719,327 stock options that are potentially dilutive to earnings per share for the nine months ended September 30, 2018; 462,046 unvested RSU's and 1,087,859 stock options for the nine months ended September 30, 2017. For the three months ended September 30, 2018 and 2017, the securities would be anti-dilutive and were excluded.
Summary of Components Excluded from Computation of Diluted Net Loss Per Share
The following potential common shares were excluded from the calculation of net income (loss) per common share, diluted as their effect would have been anti-dilutive for the periods presented:
 
Three Months Ended
September 30,
 
Nine Months Ended September 30,
 
2018
 
2017
 
2018
 
2017
Stock options
2,574,981

 
1,620,507

 
733,025

 
1,087,859

Restricted stock units
542,476

 
462,046

 
17,778

 

Warrants
2,355,506

 
2,355,506

 
2,355,506

 
2,355,506

Total
5,472,963

 
4,438,059

 
3,106,309

 
3,443,365

Schedule of Cumulative Effect of ASU 2014-09
The Company also adopted the following standards during the nine months ended September 30, 2018, none of which had a material impact on the Company's condensed consolidated financial statements:
Standard
Description
Effective date
2016-09
Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting
January 1, 2018
2016-15
Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments
January 1, 2018
2018-07
Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share Based Payment Accounting
June 1, 2018
The cumulative effect of the changes made to the condensed consolidated balance sheet as of January 1, 2018 under current assets for the adoption ASU 2014-09, Revenue - Revenue from Contracts with Customers were as follows (in thousands):
Balance Sheet
Balance at December 31, 2017
 
Adjustments due to ASU 2014-09
 
Balance at January 1, 2018
Current Assets
 
 
 
 
 
Accounts receivable
$
2,606

 
$
2,550

 
$
5,156

 
 
 
 
 
 
Liabilities and Stockholders' Equity
 
 
 
 
 
Retained earnings
$
5,555

 
$
2,550

 
$
8,105

In accordance with the new revenue recognition standards, the impact of adoption of ASC-606 to the condensed consolidated statement of operations and balance sheet for the period ended September 30, 2018 was as follows (in thousands):
Income Statement
Three Months ended September 30, 2018
 
Nine Months ended September 30, 2018
 
As reported
 
Balance without adoption - ASC-606
 
Effect of change
 
As reported
 
Balance without adoption - ASC-606
 
Effect of change
 
 
Revenue
$

 
$
1,300

 
$
(1,300
)
 
$
82,300

 
$
81,000

 
$
1,300

 
 
 
 
 
 
 
 
 
 
 
 
Provision for income taxes
$
(2,252
)
 
$
(1,888
)
 
$
(364
)
 
$
11,135

 
$
10,771

 
$
364

 
 
 
 
 
 
 
 
 

 
 
Net income (loss)
$
2,252

 
$
3,188

 
$
(936
)
 
$
71,165

 
$
70,229

 
$
936

 
September 30, 2018
Balance Sheet
As reported
 
Balance without ASC-606
 
Effect of change
Current Assets
 
 
 
 
 
Accounts receivable
$
3,850

 
$

 
$
(3,850
)
Other long-term assets (1)
$
678

 
$

 
$
(678
)
Prepaid income tax
$
2,331

 
$
2,695

 
$
364

 
 
 
 
 
 
Liabilities and Stockholders' Equity
 
 
 
 

Retained earnings
$
34,042

 
$
29,878

 
$
4,164

(1) Deferred tax assets related to the adoption of ASC-606