ý | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
DELAWARE (State or other jurisdiction of incorporation or organization) | 04-2746201 (I.R.S. Employer Identification No.) |
Title of Each Class | Name of Each Exchange on Which Registered | |
Common Stock $.01 par value | The NASDAQ Global Select Market |
Large accelerated filer | ý | Accelerated filer | ¨ | |||
Non-accelerated filer | ¨ | (Do not check if a smaller reporting company) | Smaller reporting company | ¨ | ||
Emerging growth company | ¨ |
PART I | ||
Item 1. | ||
Item 1A. | ||
Item 1B. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
PART II | ||
Item 5. | ||
Item 6. | ||
Item 7. | ||
Item 7A. | ||
Item 8. | ||
Item 9. | ||
Item 9A. | ||
Item 9B. | ||
PART III | ||
Item 10. | ||
Item 11. | ||
Item 12. | ||
Item 13. | ||
Item 14. | ||
PART IV | ||
Item 15. | ||
• | Streamlined Operating Approach. In fiscal year 2017, we adapted our organization and operating principles to focus primarily on customer and partner retention and success for many of our core products. For selected products that have new customer acquisition potential, we also strengthened our demand generation and high volume, low touch e-commerce capabilities. |
• | New Product Strategy. As part of the new strategic plan, we undertook a new product strategy to provide the platform and tools enterprises need to build next generation applications that drive their businesses, known as “Cognitive Applications.” We offer this platform to both new customers and partners as well as our existing OpenEdge partner and customer ecosystems. Our platform for Cognitive Applications makes it easy for developers to build machine learning into their applications, and includes: |
◦ | Our leading UI development tools, which enable organizations to easily build engaging user interfaces for any device or front end; |
◦ | Our NativeScript offering, which allows developers to use JavaScript to build native applications across multiple mobile platforms; |
◦ | A mission-critical back-end-as-a-service platform that runs on any cloud, is secure, high-performing, and highly-scalable while supporting all modern user interfaces; |
◦ | Automated and intuitive machine learning capabilities for accelerating the creation and delivery of Cognitive Applications; |
◦ | Our data connectivity and integration capabilities; and |
◦ | Our business logic and rules capabilities. |
• | Restructuring. With the adoption of our new product strategy, we discontinued our investment in our Digital Factory strategy and re-aligned our resources consistent with our core operating approach. To that end, during fiscal year 2017, we implemented restructuring efforts including the consolidation of facilities, implementation of a simplified organizational structure and a reduction of marketing and other external expenses. In addition, we reduced headcount by over 400 employees, totaling over 20% of our workforce. We reduced our full year expenses by over $30 million by the end of fiscal year 2017. |
• | changes in demand for our products; |
• | introduction, enhancement or announcement of products by us or our competitors; |
• | market acceptance of our new products; |
• | the growth rates of certain market segments in which we compete; |
• | size and timing of significant orders; |
• | a high percentage of our revenue is generated in the third month of each fiscal quarter and any failure to receive, complete or process orders at the end of any quarter could cause us to fall short of our revenue targets; |
• | budgeting cycles of customers; |
• | mix of distribution channels; |
• | mix of products and services sold; |
• | mix of international and North American revenues; |
• | fluctuations in currency exchange rates; |
• | changes in the level of operating expenses; |
• | changes in management; |
• | restructuring programs; |
• | changes in our sales force; |
• | completion or announcement of acquisitions by us or our competitors; |
• | customer order deferrals in anticipation of new products announced by us or our competitors; and |
• | general economic conditions in regions in which we conduct business. |
• | longer payment cycles; |
• | credit risk and higher levels of payment fraud; |
• | greater difficulties in accounts receivable collection; |
• | varying regulatory requirements; |
• | compliance with international and local trade, labor and export control laws; |
• | compliance with U.S. laws such as the Foreign Corrupt Practices Act, and local laws prohibiting bribery and corrupt payments to government officials; |
• | restrictions on the transfer of funds; |
• | difficulties in developing, staffing, and simultaneously managing a large number of varying foreign operations as a result of distance, language, and cultural differences; |
• | reduced or minimal protection of intellectual property rights in some countries; |
• | laws and business practices that favor local competitors or prohibit foreign ownership of certain businesses; |
• | seasonal reductions in business activity during the summer months in Europe and certain other parts of the world; |
• | economic instability in emerging markets; and |
• | potentially adverse tax consequences. |
• | if new or current customers desire only perpetual licenses, we may not be successful in selling subscriptions; |
• | although we intend to support our perpetual license business, the increased emphasis on a cloud strategy may raise concerns among our installed customer base; |
• | we may be unsuccessful in achieving our target pricing; |
• | our revenues might decline over the short or long term as a result of this strategy; |
• | our relationships with existing partners that resell perpetual licenses may be damaged; and |
• | we may incur costs at a higher than forecasted rate as we enhance and expand our cloud operations. |
Fiscal Year Ended | |||||||||||||||
November 30, 2017 | November 30, 2016 | ||||||||||||||
High | Low | High | Low | ||||||||||||
First quarter | $ | 32.47 | $ | 27.16 | $ | 27.11 | $ | 22.01 | |||||||
Second quarter | 30.70 | 27.46 | 26.55 | 22.57 | |||||||||||
Third quarter | 33.89 | 28.63 | 29.80 | 24.20 | |||||||||||
Fourth quarter | 42.97 | 33.23 | 30.24 | 25.55 |
November 30, | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | ||||||||||||||||||
Progress Software Corporation | $ | 100.00 | $ | 130.23 | $ | 129.59 | $ | 119.29 | $ | 147.04 | $ | 205.57 | ||||||||||||
NASDAQ Composite | 100.00 | 134.38 | 157.04 | 169.71 | 176.85 | 228.35 | ||||||||||||||||||
NASDAQ Computer | 100.00 | 126.06 | 159.08 | 172.03 | 184.51 | 260.94 |
Year Ended November 30, | 2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||
Revenue | $ | 397,572 | $ | 405,341 | $ | 377,554 | $ | 332,533 | $ | 333,996 | ||||||||||
Income (loss) from operations | 70,614 | (29,709 | ) | 14,754 | 80,740 | 63,740 | ||||||||||||||
Income (loss) from continuing operations | 37,417 | (55,726 | ) | (8,801 | ) | 49,458 | 39,777 | |||||||||||||
Net income (loss) | 37,417 | (55,726 | ) | (8,801 | ) | 49,458 | 74,907 | |||||||||||||
Basic earnings (loss) per share from continuing operations | 0.78 | (1.13 | ) | (0.17 | ) | 0.97 | 0.73 | |||||||||||||
Diluted earnings (loss) per share from continuing operations | 0.77 | (1.13 | ) | (0.17 | ) | 0.96 | 0.72 | |||||||||||||
Cash dividends declared per common share | 0.515 | 0.125 | — | — | — | |||||||||||||||
Cash, cash equivalents and short-term investments | 183,609 | 249,754 | 241,279 | 283,268 | 231,440 | |||||||||||||||
Total assets | 718,718 | 754,827 | 877,123 | 702,756 | 682,187 | |||||||||||||||
Long-term debt, including current portion | 121,909 | 135,000 | 144,375 | — | — | |||||||||||||||
Shareholders’ equity | 376,084 | 406,629 | 522,464 | 543,245 | 513,654 |
• | Streamlined Operating Approach. In fiscal year 2017, we adapted our organization and operating principles to focus primarily on customer and partner retention and success for many of our core products. For selected products that have new customer acquisition potential, we also strengthened our demand generation and high volume, low touch e-commerce capabilities. |
• | New Product Strategy. As part of the new strategic plan, we undertook a new product strategy to provide the platform and tools enterprises need to build next generation applications that drive their businesses, known as “Cognitive Applications.” We offer this platform to both new customers and partners as well as our existing OpenEdge partner and customer ecosystems. Our platform for Cognitive Applications makes it easy for developers to build machine learning into their applications, and includes: |
◦ | Our leading UI development tools, which enable organizations to easily build engaging user interfaces for any device or front end; |
◦ | Our NativeScript offering, which allows developers to use JavaScript to build native applications across multiple mobile platforms; |
◦ | A mission-critical back-end-as-a-service platform that runs on any cloud, is secure, high-performing, and highly-scalable while supporting all modern user interfaces; |
◦ | Automated and intuitive machine learning capabilities for accelerating the creation and delivery of Cognitive Applications; |
◦ | Our data connectivity and integration capabilities; and |
◦ | Our business logic and rules capabilities. |
• | Restructuring. With the adoption of our new product strategy, we discontinued our investment in our Digital Factory strategy and re-aligned our resources consistent with our core operating approach. To that end, during fiscal year 2017, we implemented restructuring efforts including the consolidation of facilities, implementation of a simplified organizational structure and a reduction of marketing and other external expenses. In addition, we reduced headcount by over 400 employees, totaling over 20% of our workforce. We reduced our full year expenses by over $30 million by the end of fiscal year 2017. |
Fiscal Year Ended | Percentage Change | ||||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | As Reported | Constant Currency | |||||||||
Revenue | $ | 397,572 | $ | 405,341 | (2 | )% | (2 | )% |
Fiscal Year Ended | Percentage Change | ||||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | As Reported | Constant Currency | |||||||||
License | $ | 124,406 | $ | 134,863 | (8 | )% | (8 | )% | |||||
As a percentage of total revenue | 31 | % | 33 | % |
Fiscal Year Ended | Percentage Change | ||||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | As Reported | Constant Currency | |||||||||
Maintenance | $ | 241,398 | $ | 238,377 | 1 | % | 1 | % | |||||
As a percentage of total revenue | 61 | % | 59 | % | |||||||||
Professional services | $ | 31,768 | $ | 32,101 | (1 | )% | (1 | )% | |||||
As a percentage of total revenue | 8 | % | 8 | % | |||||||||
Total maintenance and services revenue | $ | 273,166 | $ | 270,478 | 1 | % | 1 | % | |||||
As a percentage of total revenue | 69 | % | 67 | % |
Fiscal Year Ended | Percentage Change | ||||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | As Reported | Constant Currency | |||||||||
North America | $ | 223,942 | $ | 229,203 | (2 | )% | (2 | )% | |||||
As a percentage of total revenue | 56 | % | 57 | % | |||||||||
EMEA | $ | 130,359 | $ | 130,818 | — | % | 1 | % | |||||
As a percentage of total revenue | 33 | % | 32 | % | |||||||||
Latin America | $ | 21,158 | $ | 21,156 | — | % | (6 | )% | |||||
As a percentage of total revenue | 5 | % | 5 | % | |||||||||
Asia Pacific | $ | 22,113 | $ | 24,164 | (8 | )% | (10 | )% | |||||
As a percentage of total revenue | 6 | % | 6 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
OpenEdge segment | $ | 276,172 | $ | 276,267 | — | % | ||||
Data Connectivity and Integration segment | 40,955 | 48,009 | (15 | )% | ||||||
Application Development and Deployment segment | 80,445 | 81,065 | (1 | )% | ||||||
Total revenue | $ | 397,572 | $ | 405,341 | (2 | )% |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Cost of software licenses | $ | 5,752 | $ | 5,456 | 5 | % | ||||
As a percentage of software license revenue | 5 | % | 4 | % | ||||||
As a percentage of total revenue | 1 | % | 1 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Cost of maintenance and services | $ | 43,299 | $ | 44,760 | (3 | )% | ||||
As a percentage of maintenance and services revenue | 16 | % | 17 | % | ||||||
As a percentage of total revenue | 11 | % | 11 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Amortization of acquired intangibles | $ | 20,108 | $ | 15,496 | 30 | % | ||||
As a percentage of total revenue | 5 | % | 4 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Gross profit | $ | 328,413 | $ | 339,629 | (3 | )% | ||||
As a percentage of total revenue | 83 | % | 84 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Sales and marketing | $ | 96,345 | $ | 121,501 | (21 | )% | ||||
As a percentage of total revenue | 24 | % | 30 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Product development | $ | 76,988 | $ | 88,587 | (13 | )% | ||||
As a percentage of total revenue | 19 | % | 22 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
General and administrative | $ | 45,739 | $ | 46,532 | (2 | )% | ||||
As a percentage of total revenue | 12 | % | 11 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Impairment of goodwill | $ | — | $ | 92,000 | (100 | )% | ||||
As a percentage of total revenue | — | % | 23 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Amortization of acquired intangibles | $ | 13,039 | $ | 12,735 | 2 | % | ||||
As a percentage of total revenue | 3 | % | 3 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Impairment of intangible assets | $ | — | $ | 5,051 | (100 | )% | ||||
As a percentage of total revenue | — | % | 1 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Fees related to shareholder activist | $ | 2,020 | $ | — | 100 | % | ||||
As a percentage of total revenue | 1 | % | — | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Restructuring expenses | $ | 22,210 | $ | 1,692 | 1,213 | % | ||||
As a percentage of total revenue | 6 | % | — | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Acquisition-related expenses | $ | 1,458 | $ | 1,240 | 18 | % | ||||
As a percentage of total revenue | — | % | — | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Income (loss) from operations | $ | 70,614 | $ | (29,709 | ) | (338 | )% | |||
As a percentage of total revenue | 18 | % | (7 | )% |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
OpenEdge segment | $ | 203,675 | $ | 203,329 | — | % | ||||
Data Connectivity and Integration segment | 31,626 | 35,249 | (10 | )% | ||||||
Application Development and Deployment segment | 53,800 | 40,885 | 32 | % | ||||||
Other unallocated expenses | (218,487 | ) | (309,172 | ) | 29 | % | ||||
Total income (loss) from operations | $ | 70,614 | $ | (29,709 | ) | 338 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Interest expense | $ | (4,631 | ) | $ | (4,178 | ) | 11 | % | ||
Interest income and other, net | 921 | 839 | 10 | % | ||||||
Foreign currency loss, net | (1,317 | ) | (2,232 | ) | (41 | )% | ||||
Total other (expense) income, net | $ | (5,027 | ) | $ | (5,571 | ) | 10 | % | ||
As a percentage of total revenue | (1 | )% | (1 | )% |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Provision for income taxes | $ | 28,170 | $ | 20,446 | 38 | % | ||||
As a percentage of total revenue | 7 | % | 5 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | Percentage Change | |||||||
Net income (loss) | $ | 37,417 | $ | (55,726 | ) | 167 | % | |||
As a percentage of total revenue | 9 | % | (14 | )% |
Fiscal Year Ended | Percentage Change | ||||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | As Reported | Constant Currency | |||||||||
Revenue | $ | 405,341 | $ | 377,554 | 7 | % | 9 | % |
Fiscal Year Ended | Percentage Change | ||||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | As Reported | Constant Currency | |||||||||
License | $ | 134,863 | $ | 130,250 | 4 | % | 5 | % | |||||
As a percentage of total revenue | 33 | % | 34 | % |
Fiscal Year Ended | Percentage Change | ||||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | As Reported | Constant Currency | |||||||||
Maintenance | $ | 238,377 | $ | 217,718 | 9 | % | 11 | % | |||||
As a percentage of total revenue | 59 | % | 58 | % | |||||||||
Professional services | $ | 32,101 | $ | 29,586 | 9 | % | 9 | % | |||||
As a percentage of total revenue | 8 | % | 8 | % | |||||||||
Total maintenance and services revenue | $ | 270,478 | $ | 247,304 | 9 | % | 11 | % | |||||
As a percentage of total revenue | 67 | % | 66 | % |
Fiscal Year Ended | Percentage Change | ||||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | As Reported | Constant Currency | |||||||||
North America | $ | 229,203 | $ | 207,566 | 10 | % | 10 | % | |||||
As a percentage of total revenue | 57 | % | 55 | % | |||||||||
EMEA | $ | 130,818 | $ | 124,171 | 5 | % | 9 | % | |||||
As a percentage of total revenue | 32 | % | 33 | % | |||||||||
Latin America | $ | 21,156 | $ | 17,594 | 20 | % | 27 | % | |||||
As a percentage of total revenue | 5 | % | 5 | % | |||||||||
Asia Pacific | $ | 24,164 | $ | 28,223 | (14 | )% | (14 | )% | |||||
As a percentage of total revenue | 6 | % | 7 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
OpenEdge segment | $ | 276,267 | $ | 295,934 | (7 | )% | ||||
Data Connectivity and Integration segment | 48,009 | 37,926 | 27 | % | ||||||
Application Development and Deployment segment | 81,065 | 43,694 | 86 | % | ||||||
Total revenue | $ | 405,341 | $ | 377,554 | 7 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Cost of software licenses | $ | 5,456 | $ | 5,979 | (9 | )% | ||||
As a percentage of software license revenue | 4 | % | 5 | % | ||||||
As a percentage of total revenue | 1 | % | 2 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Cost of maintenance and services | $ | 44,760 | $ | 40,933 | 9 | % | ||||
As a percentage of maintenance and services revenue | 17 | % | 17 | % | ||||||
As a percentage of total revenue | 11 | % | 11 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Amortization of acquired intangibles | $ | 15,496 | $ | 16,830 | (8 | )% | ||||
As a percentage of total revenue | 4 | % | 4 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Gross profit | $ | 339,629 | $ | 313,812 | 8 | % | ||||
As a percentage of total revenue | 84 | % | 83 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Sales and marketing | $ | 121,501 | $ | 124,867 | (3 | )% | ||||
As a percentage of total revenue | 30 | % | 33 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Product development costs | $ | 88,587 | $ | 88,250 | — | % | ||||
Capitalized product development costs | — | (1,326 | ) | (100 | )% | |||||
Total product development expense | $ | 88,587 | $ | 86,924 | 2 | % | ||||
As a percentage of total revenue | 22 | % | 23 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
General and administrative | $ | 46,532 | $ | 57,294 | (19 | )% | ||||
As a percentage of total revenue | 11 | % | 15 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Impairment of goodwill | $ | 92,000 | $ | — | 100 | % | ||||
As a percentage of total revenue | 23 | % | — | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Amortization of acquired intangibles | $ | 12,735 | $ | 12,745 | — | % | ||||
As a percentage of total revenue | 3 | % | 3 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Impairment of intangible assets | $ | 5,051 | $ | — | 100 | % | ||||
As a percentage of total revenue | 1 | % | — | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Restructuring expenses | $ | 1,692 | $ | 12,989 | (87 | )% | ||||
As a percentage of total revenue | — | % | 3 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Acquisition-related expenses | $ | 1,240 | $ | 4,239 | (71 | )% | ||||
As a percentage of total revenue | — | % | 1 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
(Loss) income from operations | $ | (29,709 | ) | $ | 14,754 | (301 | )% | |||
As a percentage of total revenue | (7 | )% | 4 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
OpenEdge segment | $ | 203,329 | $ | 218,849 | (7 | )% | ||||
Data Connectivity and Integration segment | 35,249 | 24,107 | 46 | % | ||||||
Application Development and Deployment segment | 40,885 | 4,308 | 849 | % | ||||||
Other unallocated expenses | (309,172 | ) | (232,510 | ) | (33 | )% | ||||
Total (loss) income from operations | $ | (29,709 | ) | $ | 14,754 | (301 | )% |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Interest expense | $ | (4,178 | ) | $ | (3,788 | ) | 10 | % | ||
Interest income and other, net | 839 | 1,446 | (42 | )% | ||||||
Foreign currency loss | (2,232 | ) | (58 | ) | (3,748 | )% | ||||
Total other (expense) income, net | $ | (5,571 | ) | $ | (2,400 | ) | (132 | )% | ||
As a percentage of total revenue | (1 | )% | (1 | )% |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Provision for income taxes | $ | 20,446 | $ | 21,155 | (3 | )% | ||||
As a percentage of total revenue | 5 | % | 6 | % |
Fiscal Year Ended | ||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | Percentage Change | |||||||
Net (loss) income | $ | (55,726 | ) | $ | (8,801 | ) | (533 | )% | ||
As a percentage of total revenue | (14 | )% | (2 | )% |
(In thousands) | November 30, 2017 | November 30, 2016 | |||||
Cash and cash equivalents | $ | 133,464 | $ | 207,036 | |||
Short-term investments | 50,145 | 42,718 | |||||
Total cash, cash equivalents and short-term investments | $ | 183,609 | $ | 249,754 |
Fiscal Year Ended | |||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | November 30, 2015 | ||||||||
Net income (loss) | $ | 37,417 | $ | (55,726 | ) | $ | (8,801 | ) | |||
Non-cash reconciling items included in net income (loss) | 57,081 | 159,675 | 66,438 | ||||||||
Changes in operating assets and liabilities | 11,188 | (1,104 | ) | 46,903 | |||||||
Net cash flows from operating activities | $ | 105,686 | $ | 102,845 | $ | 104,540 |
Fiscal Year Ended | |||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | November 30, 2015 | ||||||||
Net investment activity | $ | (8,821 | ) | $ | (15,216 | ) | $ | (9,552 | ) | ||
Proceeds from sale of property, plant and equipment, net | 1,557 | — | — | ||||||||
Purchases of property and equipment | (3,377 | ) | (5,786 | ) | (7,184 | ) | |||||
Capitalized software costs | — | — | (1,661 | ) | |||||||
Payments for acquisitions, net of cash acquired | (77,150 | ) | — | (246,275 | ) | ||||||
Proceeds from divestitures | — | — | 4,500 | ||||||||
Other investing activities | — | — | (36 | ) | |||||||
Net cash flows (used in) from investing activities | $ | (87,791 | ) | $ | (21,002 | ) | $ | (260,208 | ) |
Fiscal Year Ended | |||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | November 30, 2015 | ||||||||
Proceeds from stock-based compensation plans | $ | 10,025 | $ | 9,918 | $ | 13,069 | |||||
Repurchases of common stock | (73,936 | ) | (79,188 | ) | (32,868 | ) | |||||
Dividend payment to shareholders | (24,127 | ) | — | — | |||||||
Proceeds from the issuance of debt, net of payments of principal and debt issuance costs | (12,424 | ) | (9,375 | ) | 142,588 | ||||||
Other financing activities | (2,852 | ) | (3,548 | ) | (4,489 | ) | |||||
Net cash flows from financing activities | $ | (103,314 | ) | $ | (82,193 | ) | $ | 118,300 |
(In thousands) | November 30, 2017 | November 30, 2016 | |||||
Deferred revenue, primarily related to unexpired maintenance and support contracts | $ | 142,288 | $ | 137,761 | |||
Multi-year licensing arrangements (1) | 17,150 | 26,368 | |||||
Total revenue backlog | $ | 159,438 | $ | 164,129 |
(1) | Our backlog of orders not included on the balance sheet is not subject to our normal accounting controls for information that is either reported in or derived from our basic financial statements. Note that approximately $14.8 million and $25.2 million of the multi-year licensing arrangements as of November 30, 2017 and November 30, 2016, respectively, relate to OEM arrangements in our Data Connectivity and Integration business segment, while the remaining amount relates to arrangements in our OpenEdge business segment. |
Payments Due by Period | |||||||||||||||||||
Total | Less than 1 Year | 1-3 Years | 3-5 Years | More than 5 Years | |||||||||||||||
Long-term debt: | |||||||||||||||||||
Principal payments | $ | 123,750 | $ | 6,188 | $ | 15,469 | $ | 102,093 | $ | — | |||||||||
Interest payments (1) | 15,058 | 3,491 | 6,415 | 5,152 | — | ||||||||||||||
Operating leases | 23,191 | 5,841 | 9,927 | 3,706 | 3,717 | ||||||||||||||
Purchase obligations (2) | 5,415 | 3,038 | 2,055 | 322 | — | ||||||||||||||
Unrecognized tax benefits (3) | — | — | — | — | — | ||||||||||||||
Total | $ | 167,414 | $ | 18,558 | $ | 33,866 | $ | 111,273 | $ | 3,717 |
(1) | Interest on the long-term debt is due and payable monthly and is estimated using the effective interest rate as of November 30, 2017 as the interest rate is variable. See Note 8 to the Consolidated Financial Statements appearing in Item 8 of this Form 10-K for additional information. |
(2) | Represents the fixed or minimum amounts due under purchase obligations for support service agreements. |
(3) | Our other noncurrent liabilities in the consolidated balance sheet include unrecognized tax benefits and related interest and penalties. As of November 30, 2017, we had unrecognized tax benefits of $4.5 million and an additional $0.5 million for interest and penalties classified as noncurrent liabilities. At this time, we are unable to make a reasonably reliable estimate of the timing of payments in individual years in connection with these tax liabilities; therefore, such amounts are not included in the above contractual obligation table. See Note 14 to the Consolidated Financial Statements appearing in Item 8 of this Form 10-K for additional information. |
• | Revenue from term licenses with extended payment terms over the term of the agreement within our Data Connectivity and Integration segment - These transactions are typically recognized when the amounts are billed to the customer under current revenue recognition guidance. In accordance with ASU 2014-09, revenue from term license performance obligations is expected to be recognized upon delivery and revenue from maintenance performance obligations is expected to be recognized over the contract term. To the extent the Company enters into future term licenses with extended payment terms after the adoption of ASU 2014-09, revenue from term licenses with extended payment terms will be recognized prior to the customer being billed and the Company will recognize a net contract asset on the balance sheet. Accordingly, license revenue will be accelerated under ASU 2014-09 as the Company currently does not recognize revenue until the amounts have been billed to the customer. |
• | Revenue from transactions with multiple elements within our Application Development and Deployment segment (i.e., sales of perpetual licenses with maintenance and/or support) - These transactions are currently recognized ratably over the associated maintenance period as the Company does not have VSOE for maintenance or support. Under ASU 2014-09, the requirement to have VSOE for undelivered elements that exists under current guidance is eliminated. Accordingly, the Company will recognize a portion of the sales price as revenue upon delivery of the license instead of recognizing the entire sales price ratably over the maintenance period. |
November 30, 2017 | November 30, 2016 | ||||||||||||||
Notional Value | Fair Value | Notional Value | Fair Value | ||||||||||||
Forward contracts to sell U.S. dollars | $ | 119,192 | $ | (27 | ) | $ | 74,690 | $ | (6,597 | ) | |||||
Forward contracts to purchase U.S. dollars | 462 | — | 1,673 | (19 | ) | ||||||||||
Total | $ | 119,654 | $ | (27 | ) | $ | 76,363 | $ | (6,616 | ) |
(In thousands, except share data) | November 30, 2017 | November 30, 2016 | |||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 133,464 | $ | 207,036 | |||
Short-term investments | 50,145 | 42,718 | |||||
Total cash, cash equivalents and short-term investments | 183,609 | 249,754 | |||||
Accounts receivable (less allowances of $676 in 2017 and $1,143 in 2016) | 61,210 | 65,678 | |||||
Other current assets | 18,588 | 20,621 | |||||
Total current assets | 263,407 | 336,053 | |||||
Property and equipment, net | 42,261 | 50,105 | |||||
Intangible assets, net | 94,894 | 80,827 | |||||
Goodwill | 315,041 | 278,067 | |||||
Deferred tax assets | 1,123 | 6,601 | |||||
Other assets | 1,992 | 3,174 | |||||
Total assets | $ | 718,718 | $ | 754,827 | |||
Liabilities and shareholders’ equity | |||||||
Current liabilities: | |||||||
Current portion of long-term debt | 5,819 | 15,000 | |||||
Accounts payable | 9,000 | 12,991 | |||||
Accrued compensation and related taxes | 32,373 | 26,212 | |||||
Dividends payable to shareholders | 6,619 | 6,067 | |||||
Income taxes payable | 1,173 | 1,509 | |||||
Other accrued liabilities | 20,496 | 12,999 | |||||
Short-term deferred revenue | 132,538 | 128,960 | |||||
Total current liabilities | 208,018 | 203,738 | |||||
Long-term debt | 116,090 | 120,000 | |||||
Long-term deferred revenue | 9,750 | 8,801 | |||||
Deferred tax liabilities | 2,809 | 3,901 | |||||
Other noncurrent liabilities | 5,967 | 11,758 | |||||
Commitments and contingencies (Note 9) | |||||||
Shareholders’ equity: | |||||||
Preferred stock, $.01 par value; authorized, 10,000,000 shares; issued, none | — | — | |||||
Common stock, $.01 par value; authorized, 200,000,000 shares; issued and outstanding, 47,281,035 in 2017 and 48,536,516 in 2016 | 473 | 485 | |||||
Additional paid-in capital | 249,363 | 239,011 | |||||
Retained earnings | 145,247 | 195,694 | |||||
Accumulated other comprehensive loss | (18,999 | ) | (28,561 | ) | |||
Total shareholders’ equity | 376,084 | 406,629 | |||||
Total liabilities and shareholders’ equity | $ | 718,718 | $ | 754,827 |
Fiscal Year Ended | |||||||||||
(In thousands, except per share data) | November 30, 2017 | November 30, 2016 | November 30, 2015 | ||||||||
Revenue: | |||||||||||
Software licenses | $ | 124,406 | $ | 134,863 | $ | 130,250 | |||||
Maintenance and services | 273,166 | 270,478 | 247,304 | ||||||||
Total revenue | 397,572 | 405,341 | 377,554 | ||||||||
Costs of revenue: | |||||||||||
Cost of software licenses | 5,752 | 5,456 | 5,979 | ||||||||
Cost of maintenance and services | 43,299 | 44,760 | 40,933 | ||||||||
Amortization of acquired intangibles | 20,108 | 15,496 | 16,830 | ||||||||
Total costs of revenue | 69,159 | 65,712 | 63,742 | ||||||||
Gross profit | 328,413 | 339,629 | 313,812 | ||||||||
Operating expenses: | |||||||||||
Sales and marketing | 96,345 | 121,501 | 124,867 | ||||||||
Product development | 76,988 | 88,587 | 86,924 | ||||||||
General and administrative | 45,739 | 46,532 | 57,294 | ||||||||
Impairment of goodwill and intangible assets | — | 97,051 | — | ||||||||
Amortization of acquired intangibles | 13,039 | 12,735 | 12,745 | ||||||||
Fees related to shareholder activist | 2,020 | — | — | ||||||||
Restructuring expenses | 22,210 | 1,692 | 12,989 | ||||||||
Acquisition-related expenses | 1,458 | 1,240 | 4,239 | ||||||||
Total operating expenses | 257,799 | 369,338 | 299,058 | ||||||||
Income (loss) from operations | 70,614 | (29,709 | ) | 14,754 | |||||||
Other (expense) income: | |||||||||||
Interest expense | (4,631 | ) | (4,178 | ) | (3,788 | ) | |||||
Interest income and other, net | 921 | 839 | 1,446 | ||||||||
Foreign currency loss, net | (1,317 | ) | (2,232 | ) | (58 | ) | |||||
Total other expense, net | (5,027 | ) | (5,571 | ) | (2,400 | ) | |||||
Income (loss) before income taxes | 65,587 | (35,280 | ) | 12,354 | |||||||
Provision for income taxes | 28,170 | 20,446 | 21,155 | ||||||||
Net income (loss) | $ | 37,417 | $ | (55,726 | ) | $ | (8,801 | ) | |||
Earnings (loss) per share: | |||||||||||
Basic | $ | 0.78 | $ | (1.13 | ) | $ | (0.17 | ) | |||
Diluted | $ | 0.77 | $ | (1.13 | ) | $ | (0.17 | ) | |||
Weighted average shares outstanding: | |||||||||||
Basic | 48,129 | 49,481 | 50,391 | ||||||||
Diluted | 48,516 | 49,481 | 50,391 | ||||||||
Cash dividends declared per common share | $ | 0.515 | $ | 0.125 | $ | — |
Fiscal Year Ended | |||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | November 30, 2015 | ||||||||
Net income (loss) | $ | 37,417 | $ | (55,726 | ) | $ | (8,801 | ) | |||
Other comprehensive income (loss), net of tax: | |||||||||||
Foreign currency translation adjustments | 9,655 | (3,843 | ) | (10,849 | ) | ||||||
Unrealized loss on investments, net of tax benefit of $60 in 2017, $53 in 2016, and $30 in 2015 | (93 | ) | (90 | ) | (53 | ) | |||||
Total other comprehensive income (loss), net of tax | 9,562 | (3,933 | ) | (10,902 | ) | ||||||
Comprehensive income (loss) | $ | 46,979 | $ | (59,659 | ) | $ | (19,703 | ) |
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total Shareholders' Equity | ||||||||||||||||||
(in thousands) | Number of Shares | Amount | ||||||||||||||||||||
Balance, December 1, 2014 | 50,677 | $ | 507 | $ | 209,271 | $ | 347,193 | $ | (13,726 | ) | $ | 543,245 | ||||||||||
Issuance of stock under employee stock purchase plan | 226 | 2 | 4,429 | — | — | 4,431 | ||||||||||||||||
Exercise of stock options | 449 | 4 | 8,365 | — | — | 8,369 | ||||||||||||||||
Vesting of restricted stock units | 714 | 7 | — | — | — | 7 | ||||||||||||||||
Withholding tax payments related to net issuance of restricted stock units | (215 | ) | (3 | ) | (5,628 | ) | — | — | (5,631 | ) | ||||||||||||
Tax benefit arising from employee stock purchase plan, stock options and restricted share activity | — | 2 | 608 | — | — | 610 | ||||||||||||||||
Stock-based compensation | — | — | 24,004 | — | — | 24,004 | ||||||||||||||||
Treasury stock repurchases and retirements | (1,271 | ) | (13 | ) | (13,625 | ) | (19,230 | ) | — | (32,868 | ) | |||||||||||
Net loss | — | — | — | (8,801 | ) | — | (8,801 | ) | ||||||||||||||
Other comprehensive loss | — | — | — | — | (10,902 | ) | (10,902 | ) | ||||||||||||||
Balance, November 30, 2015 | 50,580 | 506 | 227,424 | 319,162 | (24,628 | ) | 522,464 | |||||||||||||||
Issuance of stock under employee stock purchase plan | 266 | 3 | 5,325 | — | — | 5,328 | ||||||||||||||||
Exercise of stock options | 260 | 2 | 4,696 | — | — | 4,698 | ||||||||||||||||
Vesting of restricted stock units and release of deferred stock units | 700 | 7 | — | — | — | 7 | ||||||||||||||||
Withholding tax payments related to net issuance of restricted stock units | (156 | ) | (2 | ) | (3,982 | ) | — | — | (3,984 | ) | ||||||||||||
Tax benefit arising from employee stock purchase plan, stock options and restricted share activity | — | — | 489 | — | — | 489 | ||||||||||||||||
Stock-based compensation | — | — | 22,541 | — | — | 22,541 | ||||||||||||||||
Dividends declared | — | — | — | (6,067 | ) | — | (6,067 | ) | ||||||||||||||
Treasury stock repurchases and retirements | (3,113 | ) | (31 | ) | (17,482 | ) | (61,675 | ) | — | (79,188 | ) | |||||||||||
Net loss | — | — | — | (55,726 | ) | — | (55,726 | ) | ||||||||||||||
Other comprehensive loss | — | — | — | — | (3,933 | ) | (3,933 | ) | ||||||||||||||
Balance, November 30, 2016 | 48,537 | 485 | 239,011 | 195,694 | (28,561 | ) | 406,629 |
Issuance of stock under employee stock purchase plan | 220 | 2 | 4,898 | — | — | 4,900 | ||||||||||||||||
Exercise of stock options | 203 | 2 | 5,106 | — | — | 5,108 | ||||||||||||||||
Vesting of restricted stock units and release of deferred stock units | 660 | 7 | — | — | — | 7 | ||||||||||||||||
Withholding tax payments related to net issuance of restricted stock units | (118 | ) | (1 | ) | (3,755 | ) | — | — | (3,756 | ) | ||||||||||||
Tax benefit arising from employee stock purchase plan, stock options and restricted share activity | — | — | 679 | — | — | 679 | ||||||||||||||||
Stock-based compensation | — | — | 14,153 | — | — | 14,153 | ||||||||||||||||
Dividends declared | — | — | — | (24,679 | ) | — | (24,679 | ) | ||||||||||||||
Treasury stock repurchases and retirements | (2,221 | ) | (22 | ) | (10,729 | ) | (63,185 | ) | — | (73,936 | ) | |||||||||||
Net income | — | — | — | 37,417 | — | 37,417 | ||||||||||||||||
Other comprehensive income | — | — | — | — | 9,562 | 9,562 | ||||||||||||||||
Balance, November 30, 2017 | 47,281 | $ | 473 | $ | 249,363 | $ | 145,247 | $ | (18,999 | ) | $ | 376,084 |
Fiscal Year Ended | |||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | November 30, 2015 | ||||||||
Cash flows from operating activities: | |||||||||||
Net income (loss) | $ | 37,417 | $ | (55,726 | ) | $ | (8,801 | ) | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||
Depreciation and amortization of property and equipment | 7,526 | 8,506 | 9,394 | ||||||||
Amortization of acquired intangibles and other | 35,370 | 30,815 | 32,286 | ||||||||
Stock-based compensation | 14,153 | 22,541 | 24,004 | ||||||||
Changes in fair value of contingent consideration obligation | — | — | (1,508 | ) | |||||||
Loss on disposal of property and equipment | 416 | 370 | 41 | ||||||||
Impairment of goodwill and long-lived assets | — | 97,051 | 4,962 | ||||||||
Deferred income taxes | 474 | 1,307 | (1,845 | ) | |||||||
Excess tax benefits from stock plans | (904 | ) | (436 | ) | (1,349 | ) | |||||
Allowances for bad debt and sales credits | 46 | (479 | ) | 453 | |||||||
Changes in operating assets and liabilities: | |||||||||||
Accounts receivable | 6,442 | 647 | 3,747 | ||||||||
Other assets | 2,813 | (3,925 | ) | 5,428 | |||||||
Accounts payable and accrued liabilities | 673 | (3,094 | ) | (370 | ) | ||||||
Income taxes payable | 892 | 109 | 2,481 | ||||||||
Deferred revenue | 368 | 5,159 | 35,617 | ||||||||
Net cash flows from operating activities | 105,686 | 102,845 | 104,540 | ||||||||
Cash flows from investing activities: | |||||||||||
Purchases of investments | (40,380 | ) | (41,691 | ) | (24,178 | ) | |||||
Sales and maturities of investments | 31,559 | 26,475 | 14,626 | ||||||||
Purchases of property and equipment | (3,377 | ) | (5,786 | ) | (7,184 | ) | |||||
Capitalized software development costs | — | — | (1,661 | ) | |||||||
Payments for acquisitions, net of cash acquired | (77,150 | ) | — | (246,275 | ) | ||||||
Proceeds from sale of property, plant and equipment, net | 1,557 | — | — | ||||||||
Proceeds from divestitures, net | — | — | 4,500 | ||||||||
Decrease in other noncurrent assets | — | — | (36 | ) | |||||||
Net cash flows used in investing activities | (87,791 | ) | (21,002 | ) | (260,208 | ) | |||||
Cash flows from financing activities: | |||||||||||
Proceeds from stock-based compensation plans | 10,025 | 9,918 | 13,069 | ||||||||
Purchase of common stock related to withholding taxes from issuance of restricted stock units | (3,756 | ) | (3,984 | ) | (5,631 | ) | |||||
Repurchases of common stock | (73,936 | ) | (79,188 | ) | (32,868 | ) | |||||
Dividend payment to shareholders | (24,127 | ) | — | — | |||||||
Excess tax benefit from stock plans | 904 | 436 | 1,349 | ||||||||
Proceeds from the issuance of debt | — | — | 150,000 | ||||||||
Payment of long-term debt | (11,250 | ) | (9,375 | ) | (5,625 | ) | |||||
Payment of issuance costs for long-term debt | (1,174 | ) | — | (1,785 | ) | ||||||
Payment of contingent consideration | — | — | (209 | ) | |||||||
Net cash flows (used in) from financing activities | (103,314 | ) | (82,193 | ) | 118,300 | ||||||
Effect of exchange rate changes on cash | 11,847 | (4,993 | ) | (13,335 | ) | ||||||
Net decrease in cash and equivalents | (73,572 | ) | (5,343 | ) | (50,703 | ) | |||||
Cash and equivalents, beginning of year | 207,036 | 212,379 | 263,082 | ||||||||
Cash and equivalents, end of year | $ | 133,464 | $ | 207,036 | $ | 212,379 |
Supplemental disclosure: | |||||||||||
Cash paid for income taxes, net of refunds of $3,997 in 2017, $1,379 in 2016, and $2,264 in 2015 | $ | 25,992 | $ | 22,031 | $ | 17,036 | |||||
Cash paid for interest | $ | 3,597 | $ | 3,157 | $ | 2,725 | |||||
Non-cash financing activity: | |||||||||||
Total fair value of restricted stock awards, restricted stock units and deferred stock units on date vested | $ | 20,089 | $ | 17,213 | $ | 18,714 | |||||
Dividends declared | $ | 6,619 | $ | 6,067 | $ | — |
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
Beginning balance | $ | 741 | $ | 1,421 | $ | 1,646 | |||||
Charge (credit) to costs and expenses | 204 | (256 | ) | 271 | |||||||
Write-offs and other | (437 | ) | (370 | ) | (512 | ) | |||||
Translation adjustments | (10 | ) | (54 | ) | 16 | ||||||
Ending balance | $ | 498 | $ | 741 | $ | 1,421 |
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
Beginning balance | $ | 402 | $ | 772 | $ | 946 | |||||
(Credit) charge to revenue | (158 | ) | (223 | ) | 182 | ||||||
Write-offs and other | (69 | ) | (144 | ) | (332 | ) | |||||
Translation adjustments | 3 | (3 | ) | (24 | ) | ||||||
Ending balance | $ | 178 | $ | 402 | $ | 772 |
Foreign Currency Translation Adjustment | Unrealized Gains (Losses) on investments | Total | |||||||||
Balance, December 1, 2015 | $ | (24,582 | ) | $ | (46 | ) | $ | (24,628 | ) | ||
Other comprehensive loss before reclassifications | (3,843 | ) | (90 | ) | (3,933 | ) | |||||
Net other comprehensive loss | (3,843 | ) | (90 | ) | (3,933 | ) | |||||
Balance, December 1, 2016 | $ | (28,425 | ) | $ | (136 | ) | $ | (28,561 | ) | ||
Other comprehensive income (loss) before reclassifications | 9,655 | (93 | ) | 9,562 | |||||||
Net other comprehensive income (loss) | 9,655 | (93 | ) | 9,562 | |||||||
Balance, November 30, 2017 | $ | (18,770 | ) | $ | (229 | ) | $ | (18,999 | ) |
• | Revenue from term licenses with extended payment terms over the term of the agreement within our Data Connectivity and Integration segment - These transactions are typically recognized when the amounts are billed to the customer under current revenue recognition guidance. In accordance with ASU 2014-09, revenue from term license performance obligations is expected to be recognized upon delivery and revenue from maintenance performance obligations is expected to be recognized over the contract term. To the extent the Company enters into future term licenses with extended payment terms after the adoption of ASU 2014-09, revenue from term licenses with extended payment terms will be recognized prior to the customer being billed and the Company will recognize a net contract asset on the balance sheet. Accordingly, license revenue will be accelerated under ASU 2014-09 as the Company currently does not recognize revenue until the amounts have been billed to the customer. |
• | Revenue from transactions with multiple elements within our Application Development and Deployment segment (i.e., sales of perpetual licenses with maintenance and/or support) - These transactions are currently recognized ratably over the associated maintenance period as the Company does not have VSOE for maintenance or support. Under ASU 2014-09, the requirement to have VSOE for undelivered elements that exists under current guidance is eliminated. Accordingly, the Company will recognize a portion of the sales price as revenue upon delivery of the license instead of recognizing the entire sales price ratably over the maintenance period. |
Amortized Cost Basis | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||
Cash | $ | 130,547 | $ | — | $ | — | $ | 130,547 | |||||||
Money market funds | 2,917 | — | — | 2,917 | |||||||||||
State and municipal bond obligations | 40,458 | — | (231 | ) | 40,227 | ||||||||||
U.S. treasury bonds | 3,517 | — | (26 | ) | 3,491 | ||||||||||
Corporate bonds | 6,463 | — | (36 | ) | 6,427 | ||||||||||
Total | $ | 183,902 | $ | — | $ | (293 | ) | $ | 183,609 |
Amortized Cost Basis | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||
Cash | $ | 196,863 | $ | — | $ | — | $ | 196,863 | |||||||
Money market funds | 10,173 | — | — | 10,173 | |||||||||||
State and municipal bond obligations | 32,831 | — | (107 | ) | 32,724 | ||||||||||
U.S. treasury bonds | 6,542 | — | (29 | ) | 6,513 | ||||||||||
Corporate bonds | 3,485 | — | (4 | ) | 3,481 | ||||||||||
Total | $ | 249,894 | $ | — | $ | (140 | ) | $ | 249,754 |
November 30, 2017 | November 30, 2016 | ||||||||||||||
Cash and Equivalents | Short-Term Investments | Cash and Equivalents | Short-Term Investments | ||||||||||||
Cash | $ | 130,547 | $ | — | $ | 196,863 | $ | — | |||||||
Money market funds | 2,917 | — | 10,173 | — | |||||||||||
State and municipal bond obligations | — | 40,227 | — | 32,724 | |||||||||||
U.S. treasury bonds | — | 3,491 | — | 6,513 | |||||||||||
Corporate bonds | — | 6,427 | — | 3,481 | |||||||||||
Total | $ | 133,464 | $ | 50,145 | $ | 207,036 | $ | 42,718 |
November 30, 2017 | November 30, 2016 | ||||||
Due in one year or less | $ | 22,333 | $ | 21,172 | |||
Due after one year (1) | 27,812 | 21,546 | |||||
Total | $ | 50,145 | $ | 42,718 |
(1) | Includes state and municipal bond obligations, U.S. treasury bonds, and corporate bonds, which are securities representing investments available for current operations and are classified as current in the consolidated balance sheets. |
November 30, 2017 | November 30, 2016 | ||||||||||||||
Notional Value | Fair Value | Notional Value | Fair Value | ||||||||||||
Forward contracts to sell U.S. dollars | $ | 119,192 | $ | (27 | ) | $ | 74,690 | $ | (6,597 | ) | |||||
Forward contracts to purchase U.S. dollars | 462 | — | 1,673 | (19 | ) | ||||||||||
Total | $ | 119,654 | $ | (27 | ) | $ | 76,363 | $ | (6,616 | ) |
Fair Value Measurements Using | |||||||||||||||
Total Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||
Assets | |||||||||||||||
Money market funds | $ | 2,917 | $ | 2,917 | $ | — | $ | — | |||||||
State and municipal bond obligations | 40,227 | — | 40,227 | — | |||||||||||
U.S. treasury bonds | 3,491 | — | 3,491 | — | |||||||||||
Corporate bonds | 6,427 | — | 6,427 | — | |||||||||||
Liabilities | |||||||||||||||
Foreign exchange derivatives | $ | (27 | ) | $ | — | $ | (27 | ) | $ | — |
Fair Value Measurements Using | |||||||||||||||
Total Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||
Assets | |||||||||||||||
Money market funds | $ | 10,173 | $ | 10,173 | $ | — | $ | — | |||||||
State and municipal bond obligations | 32,724 | — | 32,724 | — | |||||||||||
U.S. treasury bonds | 6,513 | — | 6,513 | — | |||||||||||
Corporate bonds | 3,481 | — | 3,481 | — | |||||||||||
Liabilities | |||||||||||||||
Foreign exchange derivatives | $ | (6,616 | ) | $ | — | $ | (6,616 | ) | $ | — |
Total Fair Value | Total Losses | ||||||
Goodwill allocated to the Application Development and Deployment reporting unit | $ | 46,965 | $ | 92,000 | |||
Intangible assets | — | 5,051 |
November 30, 2017 | November 30, 2016 | ||||||
Computer equipment and software | $ | 50,588 | $ | 47,978 | |||
Land, buildings and leasehold improvements | 50,229 | 53,291 | |||||
Furniture and fixtures | 7,211 | 7,080 | |||||
Capitalized software development costs | 2,955 | 2,955 | |||||
Property and equipment, gross | 110,983 | 111,304 | |||||
Less accumulated depreciation and amortization | (68,722 | ) | (61,199 | ) | |||
Property and equipment, net | $ | 42,261 | $ | 50,105 |
November 30, 2017 | November 30, 2016 | ||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Book Value | Gross Carrying Amount | Accumulated Amortization | Net Book Value | ||||||||||||||||||
Purchased technology | $ | 154,301 | $ | (88,224 | ) | $ | 66,077 | $ | 109,886 | $ | (68,116 | ) | $ | 41,770 | |||||||||
Customer-related | 67,802 | (46,230 | ) | 21,572 | 67,602 | (35,852 | ) | 31,750 | |||||||||||||||
Trademarks and trade names | 17,740 | (10,495 | ) | 7,245 | 15,140 | (7,833 | ) | 7,307 | |||||||||||||||
Total | $ | 239,843 | $ | (144,949 | ) | $ | 94,894 | $ | 192,628 | $ | (111,801 | ) | $ | 80,827 |
2018 | $ | 36,378 | |
2019 | 35,253 | ||
2020 | 10,272 | ||
2021 | 9,550 | ||
2022 | 3,441 | ||
Total | $ | 94,894 |
November 30, 2017 | November 30, 2016 | ||||||
Balance, beginning of year | $ | 278,067 | $ | 369,985 | |||
Additions | 36,934 | — | |||||
Impairment | — | (92,000 | ) | ||||
Translation adjustments | 40 | 82 | |||||
Balance, end of year | $ | 315,041 | $ | 278,067 |
November 30, 2016 | Additions | Translation Adjustments | November 30, 2017 | ||||||||||||
OpenEdge | $ | 212,062 | $ | 36,934 | $ | 40 | $ | 249,036 | |||||||
Data Connectivity and Integration | 19,040 | — | — | 19,040 | |||||||||||
Application Development and Deployment | 46,965 | — | — | 46,965 | |||||||||||
Total goodwill | $ | 278,067 | $ | 36,934 | $ | 40 | $ | 315,041 |
Total | Life | ||||
Net working capital | $ | (963 | ) | ||
Property, plant and equipment | 26 | ||||
Purchased technology | 22,100 | 5 Years | |||
Trade name | 1,800 | 5 Years | |||
Customer relationships | 100 | 5 Years | |||
Net deferred tax assets | 1,465 | ||||
Goodwill | 24,351 | ||||
Net assets acquired | $ | 48,879 |
Total | Life | ||||
Net working capital | $ | (174 | ) | ||
Property, plant and equipment | 68 | ||||
Purchased technology | 19,900 | 5 Years | |||
Trade name | 800 | 5 Years | |||
Customer relationships | 100 | 5 Years | |||
Deferred taxes | (5,006 | ) | |||
Goodwill | 12,583 | ||||
Net assets acquired | $ | 28,271 |
Total | Weighted Average Life | ||||
Net working capital | $ | 8,222 | |||
Property, plant and equipment | 3,078 | ||||
Identifiable intangible assets | 123,100 | 5 years | |||
Deferred taxes | (9,272 | ) | |||
Deferred revenue | (7,915 | ) | |||
Other non-current liabilities | (2,732 | ) | |||
Goodwill | 137,472 | ||||
Net assets acquired | $ | 251,953 |
(In thousands, except per share data) | Pro Forma Fiscal Year Ended November 30, 2014 | ||
Revenue | $ | 367,811 | |
Net loss | $ | (30,007 | ) |
Net loss per basic and diluted share | $ | (0.59 | ) |
2018 | $ | 6,188 | |
2019 | 6,188 | ||
2020 | 9,281 | ||
2021 | 12,375 | ||
2022 | 89,718 | ||
Total | $ | 123,750 |
2018 | $ | 5,841 | |
2019 | 5,172 | ||
2020 | 4,755 | ||
2021 | 2,201 | ||
2022 | 1,505 | ||
Thereafter | 3,717 | ||
Total | $ | 23,191 |
Shares | Weighted Average | Weighted Average Remaining Contractual Term | Aggregate Intrinsic Value (1) | |||||||||
(in thousands) | Exercise Price | (in years) | (in thousands) | |||||||||
Options outstanding, December 1, 2016 | 417 | $ | 24.10 | |||||||||
Granted | 937 | 29.70 | ||||||||||
Exercised | (203 | ) | 25.90 | |||||||||
Canceled | (149 | ) | 29.31 | |||||||||
Options outstanding, November 30, 2017 | 1,002 | $ | 28.29 | 4.89 | $ | 13,077 | ||||||
Exercisable, November 30, 2017 | 269 | $ | 24.09 | 2.64 | $ | 4,639 | ||||||
Vested or expected to vest, November 30, 2017 | 875 | $ | 28.06 | 4.77 | $ | 11,620 |
(1) | The aggregate intrinsic value was calculated based on the difference between the closing price of our stock on November 30, 2017 of $41.34 and the exercise prices for all in-the-money options outstanding. |
Number of Shares | Weighted Average Fair Value | |||||
Restricted stock units outstanding, December 1, 2016 | 1,583 | $ | 26.14 | |||
Granted | 833 | 29.54 | ||||
Issued | (638 | ) | 31.40 | |||
Canceled | (642 | ) | 25.58 | |||
Restricted stock units outstanding, November 30, 2017 | 1,136 | $ | 28.15 |
Fiscal Year Ended | ||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | ||||||
Stock options: | ||||||||
Expected volatility | 25.0 | % | — | % | 28.0 | % | ||
Risk-free interest rate | 1.9 | % | — | % | 1.3 | % | ||
Expected life (in years) | 4.8 | 0 | 4.8 | |||||
Expected dividend yield | 1.7 | % | — | — | ||||
Employee stock purchase plan: | ||||||||
Expected volatility | 22.9 | % | 25.3 | % | 21.1 | % | ||
Risk-free interest rate | 1.2 | % | 0.6 | % | 0.5 | % | ||
Expected life (in years) | 1.5 | 1.6 | 1.6 | |||||
Expected dividend yield | 1.6 | % | — | — | ||||
Long-term incentive plan: | ||||||||
Expected volatility | 27.5 | % | 27.1 | % | 32.1 | % | ||
Risk-free interest rate | 1.4 | % | 1 | % | 0.9 | % | ||
Expected life (in years) | 2.7 | 2.7 | 2.7 | |||||
Expected dividend yield | 1.8 | % | — | — |
Fiscal Year Ended | |||||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
Total intrinsic value of stock options on date exercised | $ | 1,622 | $ | 2,017 | $ | 3,895 | |||||
Total fair value of deferred stock units on date vested | 57 | — | 93 | ||||||||
Total fair value of restricted stock units on date vested | 20,032 | 17,213 | 18,621 |
Fiscal Year Ended | |||||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
Cost of maintenance and services | $ | 1,016 | $ | 899 | $ | 617 | |||||
Sales and marketing | 2,214 | 4,093 | 4,805 | ||||||||
Product development | 4,576 | 9,965 | 5,433 | ||||||||
General and administrative | 6,347 | 7,584 | 13,149 | ||||||||
Total stock-based compensation | $ | 14,153 | $ | 22,541 | $ | 24,004 | |||||
Income tax benefit included in the provision for income taxes from continuing operations | $ | 4,057 | $ | 5,208 | $ | 5,225 |
Excess Facilities and Other Costs | Employee Severance and Related Benefits | Total | |||||||||
Balance, December 1, 2014 | $ | 416 | $ | 1,227 | $ | 1,643 | |||||
Costs incurred | 5,567 | 7,422 | 12,989 | ||||||||
Cash disbursements | (690 | ) | (5,653 | ) | (6,343 | ) | |||||
Asset impairment | (4,962 | ) | — | (4,962 | ) | ||||||
Translation adjustments and other | 81 | (47 | ) | 34 | |||||||
Balance, November 30, 2015 | $ | 412 | $ | 2,949 | $ | 3,361 | |||||
Costs incurred | 319 | 1,373 | 1,692 | ||||||||
Cash disbursements | (633 | ) | (2,906 | ) | (3,539 | ) | |||||
Translation adjustments and other | 9 | 27 | 36 | ||||||||
Balance, November 30, 2016 | $ | 107 | $ | 1,443 | $ | 1,550 | |||||
Costs incurred | 2,655 | 19,555 | 22,210 | ||||||||
Cash disbursements | (1,456 | ) | (17,778 | ) | (19,234 | ) | |||||
Asset impairment | (762 | ) | — | (762 | ) | ||||||
Translation adjustments and other | 26 | 336 | 362 | ||||||||
Balance, November 30, 2017 | $ | 570 | $ | 3,556 | $ | 4,126 |
Excess Facilities and Other Costs | Employee Severance and Related Benefits | Total | |||||||||
Balance, December 1, 2016 | $ | — | $ | — | $ | — | |||||
Costs incurred | 2,570 | 19,555 | 22,125 | ||||||||
Cash disbursements | (1,294 | ) | (16,335 | ) | (17,629 | ) | |||||
Asset impairment | (762 | ) | — | (762 | ) | ||||||
Translation adjustments and other | 26 | 336 | 362 | ||||||||
Balance, November 30, 2017 | $ | 540 | $ | 3,556 | $ | 4,096 |
Excess Facilities and Other Costs | Employee Severance and Related Benefits | Total | |||||||||
Balance, December 1, 2015 | $ | — | $ | — | $ | — | |||||
Costs incurred | — | 1,482 | 1,482 | ||||||||
Cash disbursements | — | (67 | ) | (67 | ) | ||||||
Balance, November 30, 2016 | $ | — | $ | 1,415 | $ | 1,415 | |||||
Cash disbursements | — | (1,415 | ) | (1,415 | ) | ||||||
Balance, November 30, 2017 | $ | — | $ | — | $ | — |
Excess Facilities and Other Costs | Employee Severance and Related Benefits | Total | |||||||||
Balance, December 1, 2014 | $ | — | $ | — | $ | — | |||||
Costs incurred | 4,406 | 3,108 | 7,514 | ||||||||
Cash disbursements | (300 | ) | (2,801 | ) | (3,101 | ) | |||||
Asset impairment | (3,999 | ) | — | (3,999 | ) | ||||||
Translation adjustments and other | 102 | 2 | 104 | ||||||||
Balance, November 30, 2015 | $ | 209 | $ | 309 | $ | 518 | |||||
Costs incurred | 326 | (43 | ) | 283 | |||||||
Cash disbursements | (477 | ) | (267 | ) | (744 | ) | |||||
Translation adjustments and other | (1 | ) | 1 | — | |||||||
Balance, November 30, 2016 | $ | 57 | $ | — | $ | 57 | |||||
Costs incurred | 22 | — | 22 | ||||||||
Cash disbursements | (79 | ) | — | (79 | ) | ||||||
Balance, November 30, 2017 | $ | — | $ | — | $ | — |
Excess Facilities and Other Costs | Employee Severance and Related Benefits | Total | |||||||||
Balance, December 1, 2014 | $ | — | $ | — | $ | — | |||||
Costs incurred | 963 | 3,108 | 4,071 | ||||||||
Cash disbursements | — | (483 | ) | (483 | ) | ||||||
Asset impairment | (963 | ) | — | (963 | ) | ||||||
Translation adjustments and other | — | (8 | ) | (8 | ) | ||||||
Balance, November 30, 2015 | $ | — | $ | 2,617 | $ | 2,617 | |||||
Costs incurred | — | (42 | ) | (42 | ) | ||||||
Cash disbursements | — | (2,572 | ) | (2,572 | ) | ||||||
Translation adjustments and other | — | 25 | 25 | ||||||||
Balance, November 30, 2016 | $ | — | $ | 28 | $ | 28 | |||||
Cash disbursements | — | (28 | ) | (28 | ) | ||||||
Balance, November 30, 2017 | $ | — | $ | — | $ | — |
Excess Facilities and Other Costs | Employee Severance and Related Benefits | Total | |||||||||
Balance, December 1, 2014 | $ | 416 | $ | 1,227 | $ | 1,643 | |||||
Costs incurred | 198 | 1,206 | 1,404 | ||||||||
Cash disbursements | (390 | ) | (2,369 | ) | (2,759 | ) | |||||
Translation adjustments and other | (21 | ) | (40 | ) | (61 | ) | |||||
Balance, November 30, 2015 | $ | 203 | $ | 24 | $ | 227 | |||||
Costs incurred | (7 | ) | (24 | ) | (31 | ) | |||||
Cash disbursements | (156 | ) | — | (156 | ) | ||||||
Translation adjustments and other | 10 | — | 10 | ||||||||
Balance, November 30, 2016 | $ | 50 | $ | — | $ | 50 | |||||
Costs incurred | 63 | — | 63 | ||||||||
Cash disbursements | (83 | ) | — | (83 | ) | ||||||
Balance, November 30, 2017 | $ | 30 | $ | — | $ | 30 |
Fiscal Year Ended | |||||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
U.S. | $ | 77,442 | $ | 78,477 | $ | 62,813 | |||||
Foreign | (11,855 | ) | (113,757 | ) | (50,459 | ) | |||||
Total | $ | 65,587 | $ | (35,280 | ) | $ | 12,354 |
Fiscal Year Ended | |||||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
Current: | |||||||||||
Federal | $ | 23,739 | $ | 12,934 | $ | 18,418 | |||||
State | 2,461 | 3,178 | 1,526 | ||||||||
Foreign | 1,496 | 3,027 | 3,056 | ||||||||
Total current | 27,696 | 19,139 | 23,000 | ||||||||
Deferred: | |||||||||||
Federal | 1,548 | 6,203 | 2,199 | ||||||||
State | 61 | (1,963 | ) | 60 | |||||||
Foreign | (1,135 | ) | (2,933 | ) | (4,104 | ) | |||||
Total deferred | 474 | 1,307 | (1,845 | ) | |||||||
Total | $ | 28,170 | $ | 20,446 | $ | 21,155 |
Fiscal Year Ended | |||||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
Tax at U.S. Federal statutory rate | $ | 22,955 | $ | (12,348 | ) | $ | 4,324 | ||||
Foreign rate differences | 4,575 | 7,689 | 16,945 | ||||||||
Effects of foreign operations included in U.S. Federal provision | (186 | ) | (1,244 | ) | (996 | ) | |||||
State income taxes, net | 1,702 | 2,977 | 1,029 | ||||||||
Research credits | (251 | ) | (838 | ) | (681 | ) | |||||
Domestic production activities deduction | (2,670 | ) | (1,925 | ) | (1,750 | ) | |||||
Tax-exempt interest | (101 | ) | (76 | ) | (51 | ) | |||||
Nondeductible stock-based compensation | 808 | 740 | 1,875 | ||||||||
Meals and entertainment | 276 | 234 | 321 | ||||||||
Compensation subject to 162(m) | 208 | — | 228 | ||||||||
Uncertain tax positions and tax settlements | 429 | (1,701 | ) | (332 | ) | ||||||
Prior period adjustment | — | (2,700 | ) | — | |||||||
Release of valuation allowance on state research and development credits | — | (2,748 | ) | — | |||||||
Goodwill Impairment | — | 32,200 | — | ||||||||
Other | 425 | 186 | 243 | ||||||||
Total | $ | 28,170 | $ | 20,446 | $ | 21,155 |
November 30, 2017 | November 30, 2016 | ||||||
Deferred tax assets: | |||||||
Accounts receivable | $ | 226 | $ | 360 | |||
Other assets | 225 | 77 | |||||
Accrued compensation | 5,456 | 3,267 | |||||
Accrued liabilities and other | 5,402 | 3,207 | |||||
Stock-based compensation | 1,160 | 4,377 | |||||
Deferred revenue | 3,436 | 1,325 | |||||
Tax credit and loss carryforwards | 31,441 | 23,167 | |||||
Gross deferred tax assets | 47,346 | 35,780 | |||||
Valuation allowance | (1,537 | ) | (3,189 | ) | |||
Total deferred tax assets | 45,809 | 32,591 | |||||
Deferred tax liabilities: | |||||||
Goodwill | (26,484 | ) | (23,685 | ) | |||
Unrealized FX gains | (644 | ) | (647 | ) | |||
Depreciation and amortization | (20,367 | ) | (5,559 | ) | |||
Total deferred tax liabilities | (47,495 | ) | (29,891 | ) | |||
Total | $ | (1,686 | ) | $ | 2,700 |
Fiscal Year Ended | |||||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
Balance, beginning of year | $ | 7,046 | $ | 4,779 | $ | 1,711 | |||||
Tax positions related to current year | 785 | 1,106 | 107 | ||||||||
Tax positions related to a prior period | (120 | ) | 1,638 | — | |||||||
Settlements with tax authorities | (155 | ) | (21 | ) | (39 | ) | |||||
Tax positions acquired | — | — | 4,464 | ||||||||
Lapses due to expiration of the statute of limitations | (36 | ) | (456 | ) | (1,464 | ) | |||||
Balance, end of year | $ | 7,520 | $ | 7,046 | $ | 4,779 |
Fiscal Year Ended | |||||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
Net income (loss) | $ | 37,417 | $ | (55,726 | ) | $ | (8,801 | ) | |||
Weighted average shares outstanding | 48,129 | 49,481 | 50,391 | ||||||||
Dilutive impact from common stock equivalents | 387 | — | — | ||||||||
Diluted weighted average shares outstanding | 48,516 | 49,481 | 50,391 | ||||||||
Basic earnings (loss) per share | $ | 0.78 | $ | (1.13 | ) | $ | (0.17 | ) | |||
Diluted earnings (loss) per share | $ | 0.77 | $ | (1.13 | ) | $ | (0.17 | ) |
Fiscal Year Ended | |||||||||||
(In thousands) | November 30, 2017 | November 30, 2016 | November 30, 2015 | ||||||||
Segment revenue: | |||||||||||
OpenEdge | $ | 276,172 | $ | 276,267 | $ | 295,934 | |||||
Data Connectivity and Integration | 40,955 | 48,009 | 37,926 | ||||||||
Application Development and Deployment | 80,445 | 81,065 | 43,694 | ||||||||
Total revenue | 397,572 | 405,341 | 377,554 | ||||||||
Segment costs of revenue and operating expenses: | |||||||||||
OpenEdge | 72,497 | 72,938 | 77,085 | ||||||||
Data Connectivity and Integration | 9,329 | 12,760 | 13,819 | ||||||||
Application Development and Deployment | 26,645 | 40,180 | 39,386 | ||||||||
Total costs of revenue and operating expenses | 108,471 | 125,878 | 130,290 | ||||||||
Segment contribution margin: | |||||||||||
OpenEdge | 203,675 | 203,329 | 218,849 | ||||||||
Data Connectivity and Integration | 31,626 | 35,249 | 24,107 | ||||||||
Application Development and Deployment | 53,800 | 40,885 | 4,308 | ||||||||
Total contribution margin | 289,101 | 279,463 | 247,264 | ||||||||
Other unallocated expenses (1) | 218,487 | 309,172 | 232,510 | ||||||||
Income (loss) from operations | 70,614 | (29,709 | ) | 14,754 | |||||||
Other expense, net | (5,027 | ) | (5,571 | ) | (2,400 | ) | |||||
Income (loss) before income taxes | $ | 65,587 | $ | (35,280 | ) | $ | 12,354 | ||||
(1) The following expenses are not allocated to our segments as we manage and report our business in these functional areas on a consolidated basis only: certain product development and corporate sales and marketing expenses, customer support, administration, amortization and impairment of acquired intangibles, impairment of goodwill, stock-based compensation, fees related to shareholder activist, restructuring, and acquisition-related expenses. |
Fiscal Year Ended | |||||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
Software licenses | $ | 124,406 | $ | 134,863 | $ | 130,250 | |||||
Maintenance | 241,398 | 238,377 | 217,718 | ||||||||
Professional services | 31,768 | 32,101 | 29,586 | ||||||||
Total | $ | 397,572 | $ | 405,341 | $ | 377,554 |
Fiscal Year Ended | |||||||||||
November 30, 2017 | November 30, 2016 | November 30, 2015 | |||||||||
United States | $ | 206,450 | $ | 212,312 | $ | 193,665 | |||||
Canada | 17,492 | 16,891 | 13,901 | ||||||||
EMEA | 130,359 | 130,818 | 124,171 | ||||||||
Latin America | 21,158 | 21,156 | 17,594 | ||||||||
Asia Pacific | 22,113 | 24,164 | 28,223 | ||||||||
Total | $ | 397,572 | $ | 405,341 | $ | 377,554 |
(in thousands, except per share data) | First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||
Fiscal year 2017: | |||||||||||||||
Revenue | $ | 90,970 | $ | 93,213 | $ | 97,310 | $ | 116,079 | |||||||
Gross profit | 75,212 | 75,846 | 79,235 | 98,120 | |||||||||||
Income from operations | 1,222 | 20,284 | 20,299 | 28,809 | |||||||||||
Net (loss) income | (525 | ) | 10,341 | 11,172 | 16,429 | ||||||||||
Basic (loss) earnings per share | (0.01 | ) | 0.21 | 0.23 | 0.35 | ||||||||||
Diluted (loss) earnings per share | (0.01 | ) | 0.21 | 0.23 | 0.34 | ||||||||||
Fiscal year 2016: | |||||||||||||||
Revenue | $ | 89,481 | $ | 96,118 | $ | 102,018 | $ | 117,724 | |||||||
Gross profit | 73,731 | 79,883 | 84,829 | 101,186 | |||||||||||
Income (loss) from operations1 | 6,705 | 12,344 | 13,606 | (62,364 | ) | ||||||||||
Net income (loss)1 | 3,216 | 7,275 | 7,576 | (73,793 | ) | ||||||||||
Basic earnings (loss) per share | 0.06 | 0.15 | 0.16 | (1.52 | ) | ||||||||||
Diluted earnings (loss) per share | 0.06 | 0.14 | 0.15 | (1.52 | ) |
Name | Age | Position | |||
John Ainsworth | 53 | Senior Vice President, Products--Core | |||
Stephen Faberman | 48 | Chief Legal Officer | |||
Yogesh Gupta | 57 | President and Chief Executive Officer | |||
Paul Jalbert | 60 | Chief Financial Officer | |||
Loren Jarrett | 43 | Chief Marketing Officer | |||
Tony Murphy | 47 | Chief Information Officer | |||
Gary Quinn | 57 | Senior Vice President, Core Field Organization | |||
Faris Sweis | 42 | Senior Vice President, General Manager-DevTools | |||
Dimitre Taslakov | 41 | Chief Talent Officer | |||
Dmitri Tcherevik | 48 | Chief Technology Officer |
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | Weighted-average Exercise Price of Outstanding Options, Warrants and Rights | Number of Securities Remaining Available For Future Issuance | ||||||||
Equity compensation plans approved by shareholders (1) | 2,114 | (2) | $ | 28.31 | 3,945 | (3) | |||||
Equity compensation plans not approved by shareholders (4) | 24 | 27.50 | 1,489 | ||||||||
Total | 2,138 | $ | 28.29 | 5,434 |
(1) | Consists of the 1992 Incentive and Nonqualified Stock Option Plan, 1994 Stock Incentive Plan, 1997 Stock Incentive Plan, 2008 Stock Option and Incentive Plan and 1991 Employee Stock Purchase Plan (ESPP). |
(2) | Includes 1,136,000 restricted stock units under our 2008 Plan. Does not include purchase rights accruing under the ESPP because the purchase price (and therefore the number of shares to be purchased) will not be determined until the end of the purchase period. |
(3) | Includes 815,000 shares available for future issuance under the ESPP. |
(4) | Consists of the 2002 Nonqualified Stock Plan and the 2004 Inducement Plan described below. |
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2.1 | |
2.2 | |
3.1 | |
3.2 | |
3.2.1 | |
3.3 | |
4.1 | |
10.1* | |
10.2* | |
10.3* | |
10.4* | |
10.5* | |
10.6* | |
10.7* | |
10.8* | |
10.9* | |
10.10* | |
10.11* | |
10.12* | |
10.13* | |
10.14* | |
10.15* | |
10.16* | |
10.17* | |
10.18* | |
10.19* | |
21.1 | |
23.1 | |
31.1 | |
31.2 | |
32.1 | |
101** | The following materials from Progress Software Corporation’s Annual Report on Form 10-K for the year ended November 30, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of November 30, 2017 and 2016, (ii) Consolidated Statements of Income for the years ended November 30, 2017, 2016 and 2015, (iii) Consolidated Statements of Comprehensive Income for the years ended November 30, 2017, 2016 and 2015, (iv) Consolidated Statements of Shareholders’ Equity for the years ended November 30, 2017, 2016 and 2015, and (v) Consolidated Statements of Cash Flows for the years ended November 30, 2017, 2016 and 2015. |
(1) | Incorporated by reference to Exhibit 2.1 of our Current Report on Form 8-K filed on October 27, 2014. |
(2) | Incorporated by reference to Exhibit 2.1 of our Current Report on Form 8-K filed on May 14, 2015. |
(3) | Incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K filed on May 14, 2015. |
(4) | Incorporated by reference to Exhibit 3.2 of our Current Report on Form 8-K filed on May 14, 2015. |
(5) | Incorporated by reference to Exhibit 3.4 of our Current Report on Form 8-K filed on May 14, 2015. |
(6) | Incorporated by reference to Exhibit 4.1 of our Annual Report on Form 10-K for the year ended November 30, 2011. |
(7) | Incorporated by reference to Exhibit 10.1 of our Annual Report on Form 10-K for the year ended November 30, 2009. |
(8) | Incorporated by reference to Exhibit 10.2 of our Annual Report on Form 10-K for the year ended November 30, 2009. |
(9) | Incorporated by reference to Exhibit 10.3 of our Annual Report on Form 10-K for the year ended November 30, 2012. |
(10) | Incorporated by reference to Exhibit 10.4 of our Annual Report on Form 10-K for the year ended November 30, 2013. |
(11) | Incorporated by reference to Exhibit 10.5 of our Annual Report on Form 10-K for the year ended November 30, 2015. |
(12) | Incorporated by reference to Exhibit 10.6 of our Annual Report on Form 10-K for the year ended November 30, 2015. |
(13) | Incorporated by reference to Annex A to our definitive Proxy Statement filed April 15, 2016. |
(14) | Incorporated by reference to Annex A to our definitive Proxy Statement filed May 7, 2013. |
(15) | Incorporated by reference to Exhibit 10.9 of our Annual Report on Form 10-K for the year ended November 30, 2013. |
(16) | Incorporated by reference to Exhibit 10.10 of our Annual Report on Form 10-K for the year ended November 30, 2012. |
(17) | Incorporated by reference to Exhibit 10.1 of our Quarterly Report on Form 10-Q for the quarter ended February 28, 2017. |
(18) | Incorporated by reference to Exhibit 10.12 of our Annual Report on Form 10-K for the year ended November 30, 2013. |
(19) | Incorporated by reference to Exhibit 10.13 of our Annual Report on Form 10-K for the year ended November 30, 2013. |
(20) | Incorporated by reference to Exhibit 10.14 of our Annual Report on Form 10-K for the year ended November 30, 2013. |
(21) | Incorporated by reference to Exhibit 10.15 of our Annual Report on Form 10-K for the year ended November 30, 2014. |
(22) | Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed November 27, 2017. |
(23) | Incorporated by reference to Exhibit 10.1 to Form 8-K filed on October 14, 2016. |
(24) | Incorporate by reference to Exhibit 10.2 to Form 8-K filed on October 14, 2016. |
(25) | Incorporated by reference to Exhibit 10.1 to Form 8-K filed on March 31, 2017. |
* | Management contract or compensatory plan or arrangement in which an executive officer or director of Progress Software Corporation participates. |
** | Pursuant to Rule 406T of Regulations S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections. |
PROGRESS SOFTWARE CORPORATION | |
By: | /s/ YOGESH K. GUPTA |
Yogesh K. Gupta | |
President and Chief Executive Officer |
Signature | Title | Date | ||
/s/ YOGESH K. GUPTA | President and Chief Executive Officer | January 26, 2018 | ||
Yogesh K. Gupta | (Principal Executive Officer) | |||
/s/ PAUL A. JALBERT | Chief Financial Officer | January 26, 2018 | ||
Paul A. Jalbert | (Principal Financial Officer and Principal Accounting Officer) | |||
/s/ JOHN R. EGAN | Non-Executive Chairman | January 26, 2018 | ||
John R. Egan | ||||
/s/ PAUL T. DACIER | Director | January 26, 2018 | ||
Paul T. Dacier | ||||
/s/ RAINER GAWLICK | Director | January 26, 2018 | ||
Rainer Gawlick | ||||
/s/ CHARLES F. KANE | Director | January 26, 2018 | ||
Charles F. Kane | ||||
/s/ DAVID A. KRALL | Director | January 26, 2018 | ||
David A. Krall | ||||
/s/ MICHAEL L. MARK | Director | January 26, 2018 | ||
Michael L. Mark | ||||
Jurisdiction | Name | |
North America | ||
California | Savvion, Inc. | |
Canada | Actional Technologies, Ltd. | |
Canada | Object Oriented Concepts, Inc. | |
Canada | Progress Software Corporation of Canada Ltd. | |
Canada | Telerik Team Success, Inc. | |
Delaware | Apama Inc. | |
Delaware | Actional Corporation | |
Delaware | DataRPM LLC | |
Delaware | Kinvey LLC | |
Delaware | MightyMeeting Inc. | |
Delaware | Object Oriented Concepts, Inc. | |
Delaware | Persistence Software LLC | |
Delaware | Progress Software International Corporation | |
Delaware | Progress Software Corporation | |
Delaware | Progress Software Denmark A/S | |
Delaware | Progress Software Germany GmbH | |
Delaware | Telerik, Inc. | |
Massachusetts | Oak Park Realty LLC | |
Massachusetts | Oak Park Realty Two LLC | |
Massachusetts | Progress Security Corporation | |
Pennsylvania | Genesis Development Corporation | |
Europe | ||
Austria | Progress Software GesmbH | |
Belgium | DataDirect Technologies NV | |
Belgium | IONA Technologies SA | |
Belgium | Progress Software NV | |
Bulgaria | Telerik AD | |
Bulgaria | Trident Acquisition EAD | |
Czech Republic | Progress Software spol. s.r.o. | |
Denmark | Progress Software A/S | |
Finland | Progress Software Oy | |
France | Progress Software S.A.S. | |
Germany | Progress Software GmbH | |
Ireland | Orbix Limited | |
Ireland | SPK Acquisitions Limited | |
Italy | Progress Software Italy S.r.l. | |
Netherlands | Progress Software B.V. | |
Netherlands | Progress Software Europe B.V. | |
Norway | Progress Software A/S | |
Poland | Progress Software Sp. z.o o. |
South Africa | Progress Software (Pty) Ltd | |
Spain | IONA Technologies Spain SL | |
Spain | Progress Software S.L. | |
Sweden | Progress Software Svenska AB | |
Switzerland | Progress Software AG | |
United Kingdom | Apama (UK) Limited | |
United Kingdom | Telerik UK Ltd. | |
United Kingdom | Trident Acquisition Limited | |
United Kingdom | Progress Software Limited | |
Latin America | ||
Argentina | Progress Software de Argentina S.A. | |
Brazil | Progress Software do Brasil Ltda. | |
Chile | Progress Software de Chile S.A. | |
Colombia | Progress Software de Colombia S.A. | |
Venezuela | Progress Software de Venezuela C.A. | |
Asia Pacific | ||
Australia | Progress Software Pty. Ltd. | |
China | Progress (Shanghai) Software System Company Limited | |
Hong Kong | IONA Technologies China Limited | |
Hong Kong | Progress Software Corporation Limited | |
India | ` | DataRPM India Private Limited |
India | Progress Software Development Private Limited | |
India | Progress Software Solutions India Private Limited | |
India | Telerik India Private Limited | |
Singapore | Progress Software Corporation (S) Pte. Ltd. | |
Other | ||
Cayman Islands | IONA Technologies Finance |
/s/ YOGESH K. GUPTA |
Yogesh K. Gupta |
/s/ PAUL A. JALBERT |
Paul A. Jalbert |
/s/ YOGESH K. GUPTA | /s/ PAUL A. JALBERT | |||
President and Chief Executive Officer | Chief Financial Officer | |||
Date: | January 26, 2018 | Date: | January 26, 2018 |
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Document and Entity Information - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Jan. 19, 2018 |
May 31, 2017 |
|
Document And Entity Information [Abstract] | |||
Entity Registrant Name | PROGRESS SOFTWARE CORP /MA | ||
Entity Central Index Key | 0000876167 | ||
Current Fiscal Year End Date | --11-30 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Nov. 30, 2017 | ||
Document Fiscal Year Focus | 2017 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 46,386,883 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 1,381 |
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Nov. 30, 2017 |
Nov. 30, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowances on accounts receivable | $ 676 | $ 1,143 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 47,281,035 | 48,536,516 |
Common stock, shares outstanding | 47,281,035 | 48,536,516 |
Consolidated Statements of Comprehensive (Loss) Income - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 37,417 | $ (55,726) | $ (8,801) |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustments | 9,655 | (3,843) | (10,849) |
Unrealized loss on investments, net of tax benefit of $60 in 2017, $53 in 2016, and $30 in 2015 | (93) | (90) | (53) |
Total other comprehensive income (loss), net of tax | 9,562 | (3,933) | (10,902) |
Comprehensive income (loss) | $ 46,979 | $ (59,659) | $ (19,703) |
Consolidated Statements of Comprehensive (Loss) Income (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Statement of Comprehensive Income [Abstract] | |||
Tax provision (benefit) included in accumulated unrealized gains on investments | $ (60) | $ (53) | $ (30) |
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Statement of Cash Flows [Abstract] | |||
Proceeds from Income Tax Refunds | $ 3,997 | $ 1,379 | $ 2,264 |
Nature of Business and Summary of Significant Accounting Policies |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nature of Business and Summary of Significant Accounting Policies | Nature of Business and Summary of Significant Accounting Policies The Company Progress offers the leading platform for developing and deploying mission-critical business applications. Progress empowers enterprises and independent software vendors (ISVs) to build and deliver cognitive-first applications that harness big data to derive business insights and competitive advantage. Progress offers leading technologies for easily building powerful user interfaces across any type of device, a reliable, scalable and secure backend platform to deploy modern applications, leading data connectivity to all sources, and award-winning predictive analytics that brings the power of machine learning to any organization. Over 1,700 ISVs, 100,000 enterprise customers, and 2 million developers rely on Progress to power their applications. Our products are generally sold as perpetual licenses, but certain products also use term licensing models and our cloud-based offerings use a subscription based model. More than half of our worldwide license revenue is realized through relationships with indirect channel partners, principally application partners and original equipment manufacturers (OEMs). Application partners are ISVs that develop and market applications using our technology and resell our products in conjunction with sales of their own products that incorporate our technology. OEMs are companies that embed our products into their own software products or devices. We operate in North America and Latin America (the Americas); Europe, the Middle East and Africa (EMEA); and the Asia Pacific region, through local subsidiaries as well as independent distributors. Accounting Principles We prepare our consolidated financial statements and accompanying notes in conformity with accounting principles generally accepted in the United States of America (GAAP). Basis of Consolidation The consolidated financial statements include our accounts and those of our subsidiaries (all of which are wholly-owned). We eliminate all intercompany balances and transactions. Use of Estimates The preparation of consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an on-going basis, management evaluates its estimates and records changes in estimates in the period in which they become known. These estimates are based on historical data and experience, as well as various other assumptions that management believes to be reasonable under the circumstances. The most significant estimates relate to the timing and amounts of revenue recognition, the realization of tax assets and estimates of tax liabilities, fair values of investments in marketable securities, intangible assets and goodwill valuations, the recognition and disclosure of contingent liabilities, the collectability of accounts receivable, and assumptions used to determine the fair value of stock-based compensation. Actual results could differ from those estimates. Foreign Currency Translation The functional currency of most of our foreign subsidiaries is the local currency in which the subsidiary operates. For foreign operations where the local currency is considered to be the functional currency, we translate assets and liabilities into U.S. dollars at the exchange rate on the balance sheet date. We translate income and expense items at average rates of exchange prevailing during each period. We accumulate translation adjustments in accumulated other comprehensive loss, a component of shareholders’ equity. For foreign operations where the U.S. dollar is considered to be the functional currency, we remeasure monetary assets and liabilities into U.S. dollars at the exchange rate on the balance sheet date and non-monetary assets and liabilities are remeasured into U.S. dollars at historical exchange rates. We translate income and expense items at average rates of exchange prevailing during each period. We recognize remeasurement adjustments currently as a component of foreign currency loss, net in the statements of operations. Transaction gains or losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in foreign currency loss, net in the statements of operations as incurred. Cash Equivalents and Investments Cash equivalents include short-term, highly liquid investments purchased with remaining maturities of three months or less. As of November 30, 2017, all of our cash equivalents were invested in money market funds. We classify investments, state and municipal bond obligations, U.S. treasury and government agency bonds, and corporate bonds and notes, as investments available-for-sale, which are stated at fair value. We include aggregate unrealized holding gains and losses, net of taxes, on available-for-sale securities as a component of accumulated other comprehensive loss in shareholders’ equity. We include realized gains and losses in interest income and other, net on the consolidated statements of operations. We monitor our investment portfolio for impairment on a periodic basis. In the event that the carrying value of an investment exceeds its fair value and the decline in value is determined to be other than temporary, an impairment charge is recorded and a new cost basis for the investment is established. In determining whether an other-than-temporary impairment exists, we consider the nature of the investment, the length of time and the extent to which the fair value has been less than cost, and our intent and ability to continue holding the security for a period sufficient for an expected recovery in fair value. Allowances for Doubtful Accounts and Sales Credit Memos We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of customers to make required payments. We establish this allowance using estimates that we make based on factors such as the composition of the accounts receivable aging, historical bad debts, changes in payment patterns, changes to customer creditworthiness and current economic trends. We also record an allowance for estimates of potential sales credit memos. This allowance is determined based on an analysis of historical credit memos issued and current economic trends, and is recorded as a reduction of revenue. A summary of activity in the allowance for doubtful accounts is as follows (in thousands):
A summary of activity in the allowance for sales credit memos is as follows (in thousands):
Concentrations of Credit Risk Our financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments, derivative instruments and trade receivables. We have cash investment policies which, among other things, limit investments to investment-grade securities. We hold our cash and cash equivalents, investments and derivative instrument contracts with high quality financial institutions and we monitor the credit ratings of those institutions. We perform ongoing credit evaluations of our customers, and the risk with respect to trade receivables is further mitigated by the diversity, both by geography and by industry, of the customer base. No single customer represented more than 10% of consolidated accounts receivable or revenue in fiscal years 2017, 2016 or 2015. Fair Value of Financial Instruments The carrying amount of our cash and cash equivalents, accounts receivable, accounts payable and long-term debt approximates fair value due to the short-term nature or market interest rates of these items. We base the fair value of short-term investments on quoted market prices or other relevant information generated by market transactions involving identical or comparable assets. We measure and record derivative financial instruments at fair value. See Note 4 for further discussion of financial instruments that are carried at fair value on a recurring and nonrecurring basis. Derivative Instruments We record all derivatives, whether designated in hedging relationships or not, on the consolidated balance sheets at fair value. We use derivative instruments to manage exposures to fluctuations in the value of foreign currencies, which exist as part of our ongoing business operations. Certain assets and forecasted transactions are exposed to foreign currency risk. Our objective for holding derivatives is to eliminate or reduce the impact of these exposures. We periodically monitor our foreign currency exposures to enhance the overall economic effectiveness of our foreign currency hedge positions. Principal currencies hedged include the euro, British pound, Brazilian real, Indian rupee, and Australian dollar. We do not enter into derivative instruments for speculative purposes, nor do we hold or issue any derivative instruments for trading purposes. We enter into certain derivative instruments that do not qualify for hedge accounting and are not designated as hedges. Although these derivatives do not qualify for hedge accounting, we believe that such instruments are closely correlated with the underlying exposure, thus managing the associated risk. The gains or losses from changes in the fair value of such derivative instruments that are not accounted for as hedges are recognized in earnings in foreign currency loss, net in the consolidated statements of operations. Property and Equipment We record property and equipment at cost. We record property and equipment purchased in business combinations at fair value, which is then treated as the cost. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or the useful lives of the assets. Useful lives by major asset class are as follows: computer equipment and software, 3 to 7 years; buildings and improvements, 5 to 39 years; and furniture and fixtures, 5 to 7 years. Repairs and maintenance costs are expensed as incurred. Product Development and Internal Use Software Expenditures for product development, other than internal use software costs, are expensed as incurred. Product development expenses primarily consist of personnel and related expenses for our product development staff, the cost of various third-party contractor fees, and allocated overhead expenses. Software development costs associated with internal use software are incurred in three stages of development: the preliminary project stage, the application development stage, and the post-implementation stage. Costs incurred during the preliminary project and post-implementation stages are expensed as incurred. Certain internal and external qualifying costs incurred during the application development stage are capitalized as property and equipment. Internal use software is amortized on a straight-line basis over its estimated useful life of three years, beginning when the software is ready for its intended use. During the fiscal years ended November 30, 2017, 2016, and 2015, there were $0, $0, and $1.3 million of internal use software development costs capitalized, respectively. Amortization expense related to internal use software totaled $0.6 million, $1.0 million, and $1.3 million during the fiscal years ended November 30, 2017, 2016, and 2015, respectively. During the second and fourth quarters of fiscal year 2015, we incurred impairment charges of $1.5 million and $1.0 million, respectively, related to software development costs capitalized for assets no longer deployed. Goodwill, Intangible Assets and Long-Lived Assets Goodwill is the amount by which the cost of acquired net assets in a business combination exceeded the fair value of net identifiable assets on the date of purchase. We evaluate goodwill and other intangible assets with indefinite useful lives, if any, for impairment annually or on an interim basis when events and circumstances arise that indicate impairment may have occurred. In performing our annual assessment, we first perform a qualitative test and if necessary, perform a quantitative test. To conduct the quantitative impairment test of goodwill, we compare the fair value of a reporting unit to its carrying value. If the reporting unit’s carrying value exceeds its fair value, we record an impairment loss to the extent that the carrying value of goodwill exceeds its implied fair value. We estimate the fair values of our reporting units using discounted cash flow models or other valuation models, such as comparative transactions and market multiples. We did not recognize any goodwill impairment charges during fiscal years 2017 or 2015. During fiscal year 2016, we recorded a $92.0 million goodwill impairment charge related to the Application Development and Deployment reporting unit (Note 6). Intangible assets are comprised of purchased technology, customer-related assets, and trademarks and trade names acquired through business combinations (Note 7). All of our intangible assets are amortized using the straight-line method over their estimated useful life. We periodically review long-lived assets (primarily property and equipment) and intangible assets with finite lives for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of those assets are no longer appropriate. We base each impairment test on a comparison of the undiscounted cash flows to the carrying value of the asset or asset group. If impairment is indicated, we write down the asset to its estimated fair value based on a discounted cash flow analysis. During fiscal year 2016, we recorded a $5.1 million asset impairment charge, which was applicable to the intangible assets obtained in connection with our acquisition of Modulus during fiscal year 2014 (Note 6). In fiscal year 2015, we recorded impairment losses totaling $5.0 million, primarily as a result of the decision to replace existing technology with technology acquired from a business combination (Note 13). Comprehensive (Loss) Income The components of comprehensive loss include, in addition to net income (loss), unrealized gains and losses on investments and foreign currency translation adjustments. Accumulated other comprehensive loss by components, net of tax (in thousands):
The tax effect on accumulated unrealized losses on investments was minimal as of November 30, 2017, November 30, 2016, and November 30, 2015. Revenue Recognition We derive our revenue primarily from software licenses and maintenance and services. Our license arrangements generally contain multiple elements, including software maintenance services, consulting services, and customer education services. We do not recognize revenue until the following four basic criteria are met: (i) persuasive evidence of an arrangement exists, (ii) our product has been shipped or, if delivered electronically, the customer has the right to access the software, (iii) the fee is fixed or determinable, and (iv) collection of the fee is probable. Evidence of an arrangement generally consists of a contract or purchase order signed by the customer. In regard to delivery, we generally ship our software electronically and do not license our software with conditions of acceptance. If an arrangement does contain conditions of acceptance, we defer recognition of the revenue until the acceptance criteria are met or the period of acceptance has passed. Services are considered delivered as the work is performed or, in the case of maintenance, over the contractual service period. We assess whether a fee is fixed or determinable at the outset of the arrangement and consider the payment terms of the transaction, including transactions that extend beyond our customary payment terms. We do not license our software with a right of return. In assessing whether the collection of the fee is probable, we consider customer credit-worthiness, a customer’s historical payment experience, economic conditions in the customer’s industry and geographic location and general economic conditions. If we do not consider collection of a fee to be probable, we defer the revenue until the fees are collected, provided all other conditions for revenue recognition have been met. In determining when to recognize revenue from a customer arrangement, we are often required to exercise judgment regarding the application of our accounting policies to a particular arrangement. The primary judgments used in evaluating revenue recognized in each period involve: determining whether collection is probable, assessing whether the fee is fixed or determinable, and determining the fair value of the maintenance and services elements included in multiple-element software arrangements. Such judgments can materially impact the amount of revenue that we record in a given period. While we follow specific and detailed rules and guidelines related to revenue recognition, we make and use significant management judgments and estimates in connection with the revenue recognized in any reporting period, particularly in the areas described above. If management made different estimates or judgments, material differences in the timing of the recognition of revenue could occur. In regard to software license revenues, perpetual and term license fees are recognized as revenue when the software is delivered, no significant obligations or contingencies related to the software exist, other than maintenance, and all other revenue recognition criteria are met. We generally recognize revenue for products distributed through application partners and distributors on a sell-in basis. Revenue from maintenance is recognized ratably over the service period. Maintenance revenue is deferred until the associated license is delivered to the customer and all other criteria for revenue recognition have been met. Revenue from other services, which are primarily consulting and customer education services, is generally recognized as the services are delivered to the customer, provided all other criteria for revenue recognition have been met. We also offer products via a software-as-a-service (SaaS) model, which is a subscription based model. Subscription revenue derived from these agreements is generally recognized on a straight-line basis over the subscription term, provided persuasive evidence of an arrangement exists, access to our software has been granted to the customer, the fee for the subscription is fixed or determinable, and collection of the subscription fee is probable. We generally sell our software licenses with maintenance services and, in some cases, also with consulting services. For these multiple element arrangements, we allocate revenue to the delivered elements of the arrangement using the residual method, whereby revenue is allocated to the undelivered elements based on vendor specific objective evidence (or VSOE) of fair value of the undelivered elements with the remaining arrangement fee allocated to the delivered elements and recognized as revenue assuming all other revenue recognition criteria are met. For the undelivered elements, we determine VSOE of fair value to be the price charged when the undelivered element is sold separately. We determine VSOE for maintenance sold in connection with a software license based on the amount that will be separately charged for the maintenance renewal period. Substantially all license arrangements indicate the renewal rate for which customers may, at their option, renew their maintenance agreement. We determine VSOE for consulting services by reference to the amount charged for similar engagements when a software license sale is not involved. We review services sold separately on a periodic basis and update, when appropriate, our VSOE of fair value for such maintenance and services to ensure that it reflects our recent pricing experience. If VSOE of fair value for the undelivered elements cannot be established, we defer all revenue from the arrangement until the earlier of the point at which such sufficient VSOE does exist or all elements of the arrangement have been delivered, or if the only undelivered element is maintenance, then we recognize the entire fee ratably over the maintenance period. If payment of the software license fees is dependent upon the performance of consulting services or the consulting services are essential to the functionality of the licensed software, then we recognize both the software license and consulting fees using the completed contract method. Sales taxes collected from customers and remitted to government authorities are excluded from revenue. Deferred revenue generally results from contractual billings for which revenue has not been recognized and consists of the unearned portion of license, maintenance, and services fees. Deferred revenue expected to be recognized as revenue more than one year subsequent to the balance sheet date is included in long-term liabilities in the consolidated balance sheets. Advertising Costs Advertising costs are expensed as incurred and were $1.5 million, $2.9 million, and $2.5 million in fiscal years 2017, 2016, and 2015, respectively. Warranty Costs We make periodic provisions for expected warranty costs. Historically, warranty costs have been insignificant. Stock-Based Compensation Stock-based compensation expense reflects the fair value of stock-based awards, less the present value of expected dividends, measured at the grant date and recognized over the relevant service period. We estimate the fair value of each stock-based award on the measurement date using either the current market price of the stock, the Black-Scholes option valuation model, or the Monte Carlo Simulation valuation model. The Black-Scholes and Monte Carlo Simulation valuation models incorporate assumptions as to stock price volatility, the expected life of options or awards, a risk-free interest rate and dividend yield. We recognize stock-based compensation expense related to options and restricted stock units on a straight-line basis over the service period of the award, which is generally 4 or 5 years for options and 3 years for restricted stock units. We recognize stock-based compensation expense related to performance stock units and our employee stock purchase plan using an accelerated attribution method. Fees Related to Shareholder Activist In September 2017, Praesidium Investment Management, one of our largest shareholders, publicly announced its disagreement with our strategy in a Schedule 13D filed with the Securities and Exchange Commission and stated that it was seeking changes in the composition of our Board of Directors. In fiscal year 2017, we incurred professional and other fees relating to Praesidium’s actions. Acquisition-Related Costs Acquisition-related costs are expensed as incurred and include those costs incurred as a result of a business combination. These costs consist of professional services fees, including third-party legal and valuation-related fees, as well as retention fees and earn-out payments treated as compensation expense. We incurred $1.5 million, $1.2 million, and $4.2 million of acquisition-related costs, which are included in acquisition-related expenses in our consolidated statement of operations, for the fiscal years ended November 30, 2017, November 30, 2016, and November 30, 2015, respectively. Restructuring Charges Our restructuring charges are comprised primarily of costs related to property abandonment, including future lease commitments, net of any sublease income, and associated leasehold improvements; and employee termination costs related to headcount reductions. We recognize and measure restructuring liabilities initially at fair value when the liability is incurred. We incurred $22.2 million, $1.7 million, and $13.0 million of restructuring related costs, which are included in restructuring expenses in our consolidated statement of operations, for the fiscal years ended November 30, 2017, November 30, 2016, and November 30, 2015, respectively. Income Taxes We provide for deferred income taxes resulting from temporary differences between financial and taxable income. We record valuation allowances to reduce deferred tax assets to the amount that is more likely than not to be realized. We recognize and measure uncertain tax positions taken or expected to be taken in a tax return utilizing a two-step approach. We first determine if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is that we measure the tax benefit as the largest amount that is more likely than not to be realized upon ultimate settlement. We recognize interest and penalties related to uncertain tax positions in our provision for income taxes on our consolidated statements of operations. Recent Accounting Pronouncements In August 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities (ASU 2017-12). ASU 2017-12 intends to better align an entity's risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The guidance in ASU 2017-12 is required for annual reporting periods beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the effect that implementation of this update will have upon adoption on our consolidated financial position and results of operations. In May 2017, the FASB issued Accounting Standards Update No. 2017-09, Compensation - Stock Compensation (Topic 718), Scope of Modification Accounting (ASU 2017-09), which amends the scope of modification accounting for share-based payment awards. The guidance in ASU 2017-09 provides that modification accounting is required only if a change in the terms or conditions of an award results in a change to the fair value, the vesting conditions, or the classification of the award as equity or liability. The guidance in ASU 2017-09 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. We are currently assessing the impact of the adoption of this standard on our consolidated financial position and results of operations. In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment (ASU 2017-04). ASU 2017-04 amends Topic 350 to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. This update requires the performance of an annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. However, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The guidance in ASU 2017-04 is required for annual reporting periods beginning after December 15, 2019, with early adoption permitted. We are currently considering whether to adopt this update prior to the required adoption date. In January 2017, the FASB issued Accounting Standards Update No. 2017-01, Business Combinations (Topic 805), Clarifying the Definition of a Business (ASU 2017-01). ASU 2017-01 provides a screen to determine when an integrated set of assets and activities is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. The guidance in ASU 2017-01 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. We adopted this update during the fourth quarter of fiscal year 2017 and the adoption did not have a material impact on our consolidated financial position and results of operations. In August 2016, the FASB issued Accounting Standards Update No. 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15). ASU 2016-15 is intended to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows and to eliminate the diversity in practice related to such classifications. The guidance in ASU 2016-15 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. We are currently evaluating the effect that implementation of this update will have upon adoption on our consolidated statement of cash flows. In March 2016, the FASB issued Accounting Standards Update No. 2016-09, Compensation - Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting (ASU 2016-09). ASU 2016-09 is intended to simplify various aspects of the accounting for employee share-based payment transactions, including accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The guidance in ASU 2016-09 is required for annual reporting periods beginning after December 15, 2016, with early adoption permitted. We are currently assessing the impact of the adoption of this standard on our consolidated financial position and results of operations. In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), which requires lessees to record most leases on their balance sheets, recognizing a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying asset for the lease term. The guidance in ASU 2016-02 is required for annual reporting periods beginning after December 15, 2018, with early adoption permitted. We currently expect that most of our operating lease commitments will be subject to the update and recognized as operating lease liabilities and right-of-use assets upon adoption. However, we are currently evaluating the effect that implementation of this update will have upon adoption on our consolidated financial position and results of operations. In April 2015, the FASB issued Accounting Standards Update No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30) Simplifying the Presentation of Debt Issuance Costs (ASU 2015-03). ASU 2015-03 requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. The guidance in ASU 2015-03 is required for annual reporting periods beginning after December 15, 2015, including interim periods within the reporting period. Accordingly, upon adoption in the first quarter of fiscal 2017, we reclassified $1.0 million from other assets to long-term debt in our consolidated balance sheet. Prior to fiscal year 2017 and the adoption of ASU 2015-03, the unamortized portion of debt issuance costs were recorded in other assets in our consolidated balance sheet. In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09). ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The guidance provided in Topic 606 requires entities to use a five-step model to recognize revenue by allocating the consideration from contracts to performance obligations on a relative standalone selling price basis. The standard also requires new disclosures regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. This new guidance was initially effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016 and early adoption was not permitted. However, in July 2015, the FASB voted to defer the effective date of this ASU by one year for reporting periods beginning after December 15, 2017, with early adoption permitted as of the original effective date. As a result, the effective date for the Company will be December 1, 2018. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance. The Company plans to adopt this ASU in accordance with the full retrospective approach, effective December 1, 2018. Fiscal year 2019 quarterly results, and comparative prior periods, will be prepared in accordance with ASC Topic 606. The first Annual Report on Form 10-K issued in accordance with ASC Topic 606 will be for the period ended November 30, 2019. Management is currently assessing the impact the adoption of this standard will have on the Company’s consolidated financial statements, but anticipates that the revenue recognition related to accounting for the following transactions will be most impacted:
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Cash, Cash Equivalents and Investments |
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Investments and Cash [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash, Cash Equivalents and Investments | Cash, Cash Equivalents and Investments A summary of our cash, cash equivalents and available-for-sale investments at November 30, 2017 is as follows (in thousands):
A summary of our cash, cash equivalents and available-for-sale investments at November 30, 2016 is as follows (in thousands):
Such amounts are classified on our consolidated balance sheets as follows (in thousands):
The fair value of debt securities by contractual maturity is as follows (in thousands):
We did not hold any investments with continuous unrealized losses as of November 30, 2017 or November 30, 2016. |
Derivative Instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | Derivative Instruments We generally use forward contracts that are not designated as hedging instruments to hedge economically the impact of the variability in exchange rates on intercompany accounts receivable and loans receivable denominated in certain foreign currencies. We generally do not hedge the net assets of our international subsidiaries. All forward contracts are recorded at fair value on the consolidated balance sheets at the end of each reporting period and expire from 30 days to 366 days. At November 30, 2017, $0.2 million and $0.2 million was recorded in other accrued liabilities and other assets in the consolidated balance sheet, respectively. At November 30, 2016, $6.6 million was recorded in other noncurrent liabilities. In fiscal year 2017, realized and unrealized gains of $9.4 million from our forward contracts were recognized in foreign currency loss, net in the consolidated statement of operations. In fiscal years 2016 and 2015, realized and unrealized losses of $4.0 million and $4.6 million, respectively, from our forward contracts were recognized in foreign currency loss, net in the consolidated statements of operations. These gains and losses were substantially offset by realized and unrealized losses and gains on the offsetting positions. The table below details outstanding foreign currency forward contracts where the notional amount is determined using contract exchange rates (in thousands):
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Fair Value Measurements |
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Fair Value Measurements | Fair Value Measurements Recurring Fair Value Measurements The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at November 30, 2017 (in thousands):
The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at November 30, 2016 (in thousands):
When developing fair value estimates, we maximize the use of observable inputs and minimize the use of unobservable inputs. When available, we use quoted market prices to measure fair value. The valuation technique used to measure fair value for our Level 1 and Level 2 assets is a market approach, using prices and other relevant information generated by market transactions involving identical or comparable assets. If market prices are not available, the fair value measurement is based on models that use primarily market based parameters including yield curves, volatilities, credit ratings and currency rates. In certain cases where market rate assumptions are not available, we are required to make judgments about assumptions market participants would use to estimate the fair value of a financial instrument. Nonrecurring Fair Value Measurements We did not have any nonrecurring fair value measurements as of November 30, 2017. During fiscal year 2016, certain assets were measured at fair value on a nonrecurring basis using significant unobservable inputs (Level 3). During the fourth quarter of fiscal year 2016, based on the fair value measurement, we recorded a $92.0 million goodwill impairment charge related to the Application Development and Deployment reporting unit. Refer to Note 6 for further discussion on the fair value of the goodwill related to the Application Development and Deployment reporting unit. During the third quarter of fiscal year 2016, based on the fair value measurement, we recorded a $5.1 million asset impairment charge, which was applicable to the intangible assets obtained in connection with our acquisition of Modulus during the second quarter of fiscal year 2014 (Note 6). The fair value measurements of intangible assets were determined using an income-based valuation methodology, which incorporates unobservable inputs, including discounted expected cash flows over the remaining estimated useful life of the technology, thereby classifying the fair value as a Level 3 measurement within the fair value hierarchy. The expected cash flows include subscription fees to be collected from existing customers using the platform, offset by hosting fees and compensation related costs to be incurred over the remaining estimated useful lives. The following table presents nonrecurring fair value measurements as of November 30, 2016 (in thousands):
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Property and Equipment |
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Property and Equipment | Property and Equipment Property and equipment consists of the following (in thousands):
Depreciation and amortization expense related to property and equipment was $7.5 million, $8.5 million, and $9.4 million for the years ended November 30, 2017, 2016, and 2015, respectively. |
Intangible Assets and Goodwill |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets and Goodwill | Intangible Assets and Goodwill Intangible Assets Intangible assets are comprised of the following significant classes (in thousands):
We amortize intangible assets assuming no expected residual value. Amortization expense related to these intangible assets was $33.1 million, $28.2 million and $29.6 million in fiscal years 2017, 2016 and 2015, respectively. The increase in intangible assets during fiscal year 2017 is primarily related to the acquisitions of DataRPM Corporation (DataRPM) in March 2017 and Kinvey Inc. (Kinvey) in June 2017 (Note 7). During the third quarter of fiscal year 2016, we evaluated the ongoing value of the intangible assets associated with the technology obtained in connection with the acquisition of Modulus. As a result of our decision to abandon the related assets due to a change in our expected ability to use the technology internally, we determined that the intangible assets were fully impaired. As a result, we incurred an impairment charge of $5.1 million in the third quarter of fiscal year 2016. Future amortization expense for intangible assets as of November 30, 2017 is as follows (in thousands):
Goodwill Changes in the carrying amount of goodwill for fiscal years 2017 and 2016 are as follows (in thousands):
The additions to goodwill during fiscal year 2017 are related to the acquisitions of DataRPM in March 2017 and Kinvey in June 2017 (Note 7). Changes in the carrying amount of goodwill by reportable segment for fiscal year 2017 are as follows (in thousands):
Impairment of Goodwill We assess the impairment of goodwill on an annual basis and whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. During fiscal year 2017, we tested goodwill for impairment for each of our reporting units as of October 31, 2017. Our reporting units each had fair values which significantly exceeded their carrying values as of the annual impairment date. We did not recognize any goodwill impairment charges during fiscal years 2017 or 2015. During fiscal year 2016, we recognized a $92 million goodwill impairment loss related to our Application Development and Deployment reporting unit. To determine the fair value of our Application Development and Deployment reporting unit as part of the two-step test for goodwill impairment as of October 31, 2016, we concluded that a combination of the income approach and the market approach was most appropriate. The fair value of this reporting unit was negatively impacted by reduced future growth expectations resulting from a comprehensive review of our strategy and operations by our Chief Executive Officer, our Board of Directors, and the executive management team. Based on this analysis, the implied fair value of goodwill was substantially lower than the carrying value of goodwill for the reporting unit, resulting in the $92 million goodwill impairment loss. This impairment loss was recorded to impairment of goodwill within operating expenses in our fiscal year 2016 consolidated statement of operations. The evaluation of goodwill for impairment requires significant judgment. While we believe that the assumptions used in our impairment test are reasonable, the analysis is sensitive to adverse changes used in the assumptions of the valuations. In particular, changes in the projected cash flows, the discount rate, the terminal year growth rate and market multiple assumptions could produce significantly different results for the impairment analyses. In the event of future changes in business conditions, we will be required to reassess and update our forecasts and estimates used in future impairment analyses. If the results of these analyses are lower than current estimates, a material impairment charge may result at that time. |
Business Combinations |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations | Business Combinations Kinvey Acquisition On June 1, 2017, we acquired by merger 100% of the outstanding securities of Kinvey for an aggregate sum of $49.2 million, which includes approximately $0.3 million held-back from the founder of Kinvey as an incentive to remain with the Company for at least two years following the acquisition. The $0.3 million held-back is being recorded to expense over the service period. Kinvey is a privately-held company providing Backend-as-a-Service (BaaS), which allows developers to set up, use, and operate a cloud backend for any native, hybrid, web, or IoT app built using any development tools. This acquisition, in combination with our existing frontend technologies, cognitive capabilities from DataRPM, our strong business logic and rules capabilities, and our strong data connectivity technologies, enables us to offer a premier platform for building and delivering cognitive business applications. The acquisition was accounted for as a business combination, and accordingly, the results of operations of Kinvey are included in our operating results as part of the OpenEdge business segment from the date of acquisition. We paid the purchase price in cash from available funds. The total consideration, less the $0.3 million held-back discussed above, which is considered to be a compensation arrangement, was allocated to Kinvey's tangible assets, identifiable intangible assets and assumed liabilities based on their estimated fair values. The excess of the total consideration, less the amount held-back from the founder, over the tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill. The allocation of the purchase price was completed in the fourth quarter of fiscal year 2017 upon the finalization of our valuation of identifiable intangible assets and deferred taxes. The allocation of the purchase price is as follows (in thousands):
The fair value of the intangible assets was estimated using the income approach in which the after-tax cash flows are discounted to present value. The cash flows are based on estimates used to price the acquisition, and the discount rates applied were benchmarked with reference to the implied rate of return from the transaction model as well as the weighted average cost of capital. Deferred taxes include deferred tax liabilities resulting from the tax effects of fair value adjustments related to identifiable intangible assets, which are more than offset by the value of deferred tax assets acquired from Kinvey. Tangible assets acquired and assumed liabilities were recorded at fair value. We recorded the excess of the purchase price over the identified tangible and intangible assets as goodwill. We believe that the investment value of the future enhancement of our product and solution offerings created as a result of this acquisition has principally contributed to a purchase price that resulted in the recognition of $24.4 million of goodwill, which is not deductible for tax purposes. Acquisition-related transaction costs (e.g., legal, due diligence, valuation, and other professional fees) are not included as a component of consideration paid, but are required to be expensed as incurred. During the fiscal year ended November 30, 2017, we incurred approximately $1.1 million of acquisition-related costs, which are included in acquisition-related expenses in our consolidated statement of operations. We have not disclosed the amount of revenues and earnings of Kinvey since acquisition, nor pro forma financial information, as those amounts are not significant to our consolidated financial statements. DataRPM Acquisition On March 1, 2017, we acquired by merger 100% of the outstanding securities of DataRPM for an aggregate sum of $30.0 million. Approximately $1.7 million of the purchase price was paid to DataRPM’s founders in the form of restricted stock units, subject to a two-year vesting schedule and continued employment. DataRPM is a privately-held company and leader in cognitive predictive maintenance for the industrial IoT (IIoT) market. This acquisition is a key part of the Company's strategy to provide the best platform to build and deliver cognitive-first applications. The acquisition was accounted for as a business combination, and accordingly, the results of operations of DataRPM are included in our operating results as part of the OpenEdge business segment from the date of acquisition. We paid the purchase price in cash from available funds. The total consideration, less the fair value of the granted restricted stock units discussed above, which are considered compensation arrangements, was allocated to DataRPM’s tangible assets, identifiable intangible assets and assumed liabilities based on their estimated fair values. The excess of the total consideration, less the fair value of the restricted stock units, over the tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill. The allocation of the purchase price was completed in the fourth quarter of fiscal year 2017 upon the finalization of our valuation of identifiable intangible assets and deferred taxes. The allocation of the purchase price is as follows (in thousands):
The fair value of the intangible assets was estimated using the income approach in which the after-tax cash flows are discounted to present value. The cash flows are based on estimates used to price the acquisition, and the discount rates applied were benchmarked with reference to the implied rate of return from the transaction model as well as the weighted average cost of capital. Deferred taxes include deferred tax liabilities resulting from the tax effects of fair value adjustments related to identifiable intangible assets, partially offset by the fair value of deferred tax assets acquired from DataRPM. Tangible assets acquired and assumed liabilities were recorded at fair value. We recorded the excess of the purchase price over the identified tangible and intangible assets as goodwill. We believe that the investment value of the future enhancement of our product and solution offerings created as a result of this acquisition has principally contributed to a purchase price that resulted in the recognition of $12.6 million of goodwill, which is not deductible for tax purposes. As discussed above, approximately $1.7 million of the total consideration was paid to DataRPM’s founders in restricted stock units, subject to a vesting schedule and continued employment. We concluded that the restricted stock units are compensation arrangements and we are recognizing stock-based compensation expense in accordance with the vesting schedule over the service period of the awards, which is 2 years. During the fiscal year ended November 30, 2017, we incurred $0.4 million of stock-based compensation expense related to these restricted stock units, which is included in operating expenses in our consolidated statement of operations. Acquisition-related transaction costs (e.g., legal, due diligence, valuation, and other professional fees) are not included as a component of consideration transferred, but are required to be expensed as incurred. During the fiscal year ended November 30, 2017, we incurred approximately $0.4 million of acquisition-related costs, which are included in acquisition-related expenses in our consolidated statement of operations. We have not disclosed the amount of revenues and earnings of DataRPM since acquisition, nor pro forma financial information, as those amounts are not significant to our consolidated financial statements. Telerik Acquisition On December 2, 2014, we completed the acquisition of all of the outstanding securities of Telerik AD (Telerik), a leading provider of application development tools based in Sofia, Bulgaria, for total consideration of $262.5 million. Approximately $10.5 million of the total consideration was paid to Telerik’s founders and certain other key employees in restricted stock units, subject to a vesting schedule and continued employment. Under the Securities Purchase Agreement, 10% of the total consideration was deposited into an escrow account to secure certain indemnification and other obligations of the sellers to Progress. In accordance with the agreement, the full amount of the escrow was released to the former equity holders in June 2016. We funded the acquisition through a combination of existing cash resources and a term loan. The total consideration, less the fair value of the granted restricted stock units discussed above, which were considered compensation arrangements, was allocated to Telerik’s tangible assets, identifiable intangible assets and assumed liabilities based on their estimated fair values. The excess of the total consideration, less the fair value of the restricted stock units, over the tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill. The allocation of the purchase price was completed in the fourth quarter of fiscal year 2015 upon the finalization of our valuation of identifiable intangible assets. The following table discloses the net assets acquired in the business combination (in thousands):
The fair value of the intangible assets was estimated using the income approach in which the after-tax cash flows are discounted to present value. The cash flows are based on estimates prepared by management, and the discount rates applied were benchmarked with reference to the implied rate of return from the transaction model as well as the weighted average cost of capital. Based on the valuation, the acquired intangible assets are comprised of purchased technology of approximately $64.8 million, customer-related of approximately $47.1 million, and trademarks and trade names of approximately $11.2 million. We recorded the excess of the purchase price over the identified tangible and intangible assets as goodwill. Upon completion of the acquisition, we believed that the investment value of the future enhancement of our product and solution offerings created as a result of this acquisition had principally contributed to a purchase price that resulted in the recognition of $137.5 million of goodwill, which is not deductible for tax purposes. Acquisition-related transaction costs (e.g., legal, due diligence, valuation, and other professional fees) and certain acquisition restructuring and related charges are not included as a component of consideration transferred, but are required to be expensed as incurred. During the fiscal years ended November 30, 2016 and 2015, we incurred approximately $1.1 million and $3.7 million of acquisition-related costs, respectively, which are included in acquisition-related expenses in our consolidated statement of operations. There were no additional acquisition-related expenses incurred during the fiscal year ended November 30, 2017. In connection with the acquisition of Telerik, we agreed to provide retention bonuses to certain Telerik employees as an incentive for those employees to remain with Telerik for at least 1 year following the acquisition. We concluded that the retention bonuses for these individuals, which totaled approximately $2.2 million, were compensation arrangements and recognized these costs over the one-year service period. During the fiscal year ended November 30, 2015, we incurred $2.2 million of expense related to the retention bonuses, which are included in the acquisition-related expenses in our consolidated statement of operations discussed above. There were no additional expenses related to the retention bonuses incurred during the fiscal years ended November 30, 2016 and 2017 as the entire amount accrued during fiscal year 2015 was paid in December 2015. The operations of Telerik and the related goodwill are included in our operating results as part of the Application Development and Deployment segment from the date of acquisition. The amount of revenue of Telerik included in our consolidated statement of operations during the fiscal years ended November 30, 2017, 2016 and 2015 was $75.3 million, $75.3 million, and $41.8 million, respectively. The revenue of Telerik products and maintenance is primarily recognized ratably over the maintenance period, which is generally one year, as VSOE of fair value cannot be established for such maintenance. The amount of pretax losses of Telerik included in our consolidated statement of operations during the fiscal years ended November 30, 2017, 2016 and 2015 were $12.3 million, $32.2 million, and $54.1 million, respectively. The pretax losses include the amortization expense for fiscal years 2017, 2016, and 2015 of approximately $24.6 million related to the acquired intangible assets discussed above. Pro Forma Information (Unaudited) The following pro forma financial information presents the combined results of operations of Progress and Telerik as if the acquisition had occurred on December 1, 2013 after giving effect to certain pro forma adjustments. The pro forma adjustments reflected herein include only those adjustments that are directly attributable to the Telerik acquisition and factually supportable. These pro forma adjustments include (i) a decrease in revenue from Telerik due to the beginning balance of deferred revenue being adjusted to reflect the fair value of the acquired balance, (ii) a net increase in amortization expense to eliminate historical amortization of Telerik intangible assets and to record amortization expense for the $123.1 million of acquired identifiable intangible assets, (iii) stock-based compensation expense relating to the consideration paid to Telerik’s founders and certain other key employees in restricted stock units, as discussed above, (iv) a net increase in interest expense to eliminate historical interest expense of Telerik as a result of the repayment of all Telerik outstanding debt in connection with the acquisition and to record interest expense for the period presented as a result of the new credit facility entered into by Progress in connection with the acquisition, (v) acquisition-related costs, including transaction costs incurred by Progress related to the accrual of retention bonuses discussed above, and (vi) the income tax effect of the adjustments made at either the statutory tax rate of Bulgaria (10%) or the statutory tax rate of the U.S. (approximately 37%) depending on which jurisdiction the adjustment impacts. The pro forma financial information does not reflect any adjustments for anticipated synergies resulting from the acquisition and is not necessarily indicative of the operating results that would have actually occurred had the transaction been consummated on December 1, 2013.
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Term Loan and Line of Credit |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Term Loan and Line of Credit | Term Loan and Line of Credit On November 20, 2017, we entered into an amended and restated credit agreement (the "Credit Agreement") with certain lenders (the "Lenders"), JPMorgan Chase Bank, N.A., as Administrative Agent, Wells Fargo Bank, N.A. and Citizens Bank, N.A., as Syndication Agents, Bank of America, N.A., Citibank, N.A., Silicon Valley Bank, and Santander Bank, N.A., as Documentation Agents, and JPMorgan Chase Bank, N.A., as Sole Bookrunner and Sole Lead Arranger, which provides for a $123.8 million secured term loan and a $150.0 million secured revolving credit facility (the "Credit Facilities"). The revolving credit facility may be made available in U.S. Dollars and certain other currencies and may be increased by up to an additional $125.0 million if the existing or additional lenders are willing to make such increased commitments. The amended Credit Agreement modifies our existing credit facilities by extending the maturity date to November 20, 2022, extending the principal repayments of the term loan, and modifying the interest rates applicable to the borrowings. No additional amounts were borrowed as part of this modification. The amended Credit Agreement replaces our previous credit agreement dated December 2, 2014, which was set to mature on December 2, 2019. We borrowed the term loan included in our previous credit agreement to partially fund our acquisition of Telerik, as described in Note 7. Loans under the previous credit agreement could be prepaid before maturity in whole or in part at our option without penalty or premium. At the time we entered into the amended Credit Agreement, there were no revolving loans and $1.4 million letters of credit outstanding, which were incorporated into the new credit facility. The revolving credit facility has sublimits for swing line loans up to $25.0 million and for the issuance of standby letters of credit in a face amount up to $25.0 million. We expect to use the revolving credit facility for general corporate purposes, including acquisitions of other businesses, and may also use it for working capital. Interest rates for the term loan and revolving credit facility are based upon our leverage ratio and determined based on an index selected at our option. The rates would range from 1.50% to 2.00% above the Eurodollar rate for Eurodollar-based borrowings or from 0.50% to 1.00% above the defined base rate for base rate borrowings. Additionally, we may borrow certain foreign currencies at rates set in the same respective range above the London interbank offered interest rates (LIBOR) for those currencies. A quarterly commitment fee on the undrawn portion of the revolving credit facility is required and ranges from 0.25% to 0.35% per annum based on our leverage ratio. The average interest rate of the credit facility during the fiscal year ended November 30, 2017 was 2.76% and the interest rate as of November 30, 2017 was 2.88%. The credit facility matures on November 20, 2022, when all amounts outstanding will be due and payable in full. The revolving credit facility does not require amortization of principal. The outstanding balance of the term loan as of November 30, 2017 was $123.8 million, with $6.2 million due in the next 12 months. The term loan requires repayment of principal at the end of each fiscal quarter, beginning with the fiscal quarter ended February 28, 2018. The principal repayment amounts are in accordance with the following schedule: (i) eight payments of $1.5 million each, (ii) four payments of $2.3 million each, (iii) four payments of $3.1 million each, (iv) three payments of $3.9 million each, and (v) the last payment is of the remaining principal amount. Any amounts outstanding under the term loan thereafter would be due on the maturity date. The term loan may be prepaid before maturity in whole or in part at our option without penalty or premium. As of November 30, 2017, the carrying value of the term loan approximates the fair value, based on Level 2 inputs (observable market prices in less than active markets), as the interest rate is variable over the selected interest period and is similar to current rates at which we can borrow funds. Costs incurred in connection with the debt modification of $1.2 million, along with $0.7 million of unamortized debt issuance costs related to the previous credit agreement, are recorded as debt issuance costs as a direct deduction from the carrying value of the debt liability in our consolidated balance sheet as of November 30, 2017. These costs are being amortized over the term of the debt agreement using the effective interest rate method. Prior to fiscal year 2017 and the adoption of ASU 2015-03, the unamortized portion of debt issuance costs were recorded in other assets in our consolidated balance sheet (Note 1). Amortization expense related to debt issuance costs of $0.4 million, $0.4 million, and $0.4 million for the fiscal years ended November 30, 2017, 2016, and 2015, respectively, is recorded within interest expense in our consolidated statements of operations. Revolving loans may be borrowed, repaid and reborrowed until November 20, 2022, at which time all amounts outstanding must be repaid. Accrued interest on the loans is payable quarterly in arrears with respect to base rate loans and at the end of each interest rate period (or at each three-month interval in the case of loans with interest periods greater than three months) with respect to LIBO rate loans. We may prepay the loans or terminate or reduce the commitments in whole or in part at any time, without premium or penalty, subject to certain conditions and reimbursement of certain costs in the case of LIBO rate loans. As of November 30, 2017, there were no amounts outstanding under the revolving line and $1.4 million of letters of credit. We are the sole borrower under the credit facility. Our obligations under the Credit Agreement are guaranteed by each of our material domestic subsidiaries and are secured by substantially all of our assets and such material domestic subsidiaries, as well as 100% of the capital stock of our domestic subsidiaries and 65% of the capital stock of our first-tier foreign subsidiaries, in each case, subject to certain exceptions as described in the Credit Agreement. Future material domestic subsidiaries will be required to guaranty our obligations under the Credit Agreement, and to grant security interests in substantially all of their assets to secure such obligations. The Credit Agreement generally prohibits, with certain exceptions, any other liens on our assets, subject to certain exceptions as described in the Credit Agreement. The credit facility contains customary affirmative and negative covenants, including covenants that limit or restrict our ability to, among other things, grant liens, make investments, make acquisitions, incur indebtedness, merge or consolidate, dispose of assets, pay dividends or make distributions, repurchase stock, change the nature of the business, enter into certain transactions with affiliates and enter into burdensome agreements, in each case subject to customary exceptions for a credit facility of this size and type. We are also required to maintain compliance with a consolidated fixed charge coverage ratio, a consolidated total leverage ratio and a consolidated senior secured leverage ratio. We are in compliance with these financial covenants as of November 30, 2017. As of November 30, 2017, aggregate principal payments of long-term debt for the next five years and thereafter are (in thousands):
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Commitments and Contingencies |
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Commitments and Contingencies | Commitments and Contingencies Leasing Arrangements We lease certain facilities and equipment under non-cancelable operating lease arrangements. Future minimum rental payments under these leases are as follows at November 30, 2017 (in thousands):
Our operating lease arrangements are subject to customary renewal and base rental fee escalation clauses. Total rent expense, net of sublease income which is insignificant, under operating lease arrangements was approximately $6.9 million, $8.0 million and $8.6 million in fiscal years 2017, 2016 and 2015, respectively. Guarantees and Indemnification Obligations We include standard intellectual property indemnification provisions in our licensing agreements in the ordinary course of business. Pursuant to our product license agreements, we will indemnify, hold harmless, and agree to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally business partners or customers, in connection with certain patent, copyright or other intellectual property infringement claims by third parties with respect to our products. Other agreements with our customers provide indemnification for claims relating to property damage or personal injury resulting from the performance of services by us or our subcontractors. Historically, our costs to defend lawsuits or settle claims relating to such indemnity agreements have been insignificant. Accordingly, the estimated fair value of these indemnification provisions is immaterial. Legal Proceedings We are subject to various legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business. While the outcome of these claims cannot be predicted with certainty, management does not believe that the outcome of any of these other legal matters will have a material effect on our financial position, results of operations or cash flows. |
Shareholders' Equity |
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Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Preferred Stock Our Board of Directors is authorized to establish one or more series of preferred stock and to fix and determine the number and conditions of preferred shares, including dividend rates, redemption and/or conversion provisions, if any, preferences and voting rights. As of November 30, 2017, there was no preferred stock issued or outstanding. Common Stock We have 200,000,000 shares of authorized common stock, $0.01 par value per share, of which 47,281,035 were issued and outstanding at November 30, 2017. There were 92,817 deferred stock units (DSUs) outstanding at November 30, 2017. Each DSU represents one share of our common stock and all DSU grants have been made to non-employee members of our Board of Directors. DSUs do not have voting rights and can only be converted into common stock when the recipient ceases to be a member of the Board of Directors or a change in control of the Company occurs. During the fiscal year ended November 30, 2017, we released 22,545 DSUs as a result of two individuals leaving our Board of Directors. Common Stock Repurchases In fiscal year 2015, we repurchased and retired 1.3 million shares for $32.9 million under the share repurchase program previously authorized by our Board of Directors. In fiscal year 2016, we repurchased and retired 3.1 million shares of our common stock for $79.2 million under the share repurchase program authorized by our Board of Directors. In September 2017, our Board of Directors increased the total share repurchase authorization to $250.0 million. In fiscal year 2017, we repurchased and retired 2.2 million shares of our common stock for $73.9 million. As of November 30, 2017, there is $220.0 million remaining under this current authorization. Dividends On September 27, 2016, our Board of Directors approved the initiation of a quarterly cash dividend of $0.125 per share of common stock to Progress shareholders. On September 6, 2017, our Board of Directors approved a 12% increase in our quarterly cash dividend to $0.14 per share of common stock. We have declared aggregate per share quarterly cash dividends totaling $0.515 and $0.125 for the years ended November 30, 2017 and 2016, respectively. We have paid aggregate cash dividends totaling $24.1 million and $0 for the years ended November 30, 2017 and 2016, respectively. |
Stock-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation | Stock-Based Compensation We currently have one shareholder-approved stock plan from which we can issue stock-based awards, which was approved by our shareholders in fiscal year 2008 (2008 Plan). The 2008 Plan replaced the 1992 Incentive and Nonqualified Stock Option Plan, the 1994 Stock Incentive Plan and the 1997 Stock Incentive Plan (collectively, the “Previous Plans”). The Previous Plans solely exist to satisfy outstanding options previously granted under those plans. The 2008 Plan permits the granting of stock awards to officers, members of the Board of Directors, employees and consultants. Awards under the 2008 Plan may include nonqualified stock options, incentive stock options, grants of conditioned or restricted stock, unrestricted grants of stock, grants of stock contingent upon the attainment of performance goals, deferred stock units and stock appreciation rights. A total of 54,510,000 shares are issuable under these plans, of which 3,129,512 shares were available for grant as of November 30, 2017. We have adopted two stock plans for which the approval of shareholders was not required: the 2002 Nonqualified Stock Plan (2002 Plan) and the 2004 Inducement Stock Plan (2004 Plan). The 2002 Plan permits the granting of stock awards to non-executive officer employees and consultants. Executive officers and members of the Board of Directors are not eligible for awards under the 2002 Plan. Awards under the 2002 Plan may include nonqualified stock options, grants of conditioned or restricted stock, unrestricted grants of stock, grants of stock contingent upon the attainment of performance goals and stock appreciation rights. A total of 9,750,000 shares are issuable under the 2002 Plan, of which 906,293 shares were available for grant as of November 30, 2017. The 2004 Plan is reserved for persons to whom we may issue securities as an inducement to become employed by us pursuant to the rules and regulations of the NASDAQ Stock Market. Awards under the 2004 Plan may include nonqualified stock options, grants of conditioned or restricted stock, unrestricted grants of stock, grants of stock contingent upon the attainment of performance goals and stock appreciation rights. A total of 1,500,000 shares are issuable under the 2004 Plan, of which 583,021 shares were available for grant as of November 30, 2017. Under all of our plans, the options granted generally begin to vest within one year of the grant. A summary of stock option activity under all the plans is as follows:
A summary of restricted stock units activity is as follows (in thousands, except per share data):
Each restricted stock unit represents one share of common stock. The restricted stock units generally vest semi-annually over a three-year period. Performance-based restricted stock units are subject to performance criteria aligned with our business plan and are earned only to the extent the performance criteria are achieved, with any awards earned being subject to subsequent time-based vesting similar to that discussed above. The fair value of outright stock awards, restricted stock units and DSUs is equal to the closing price of our common stock on the date of grant, less the present value of expected dividends, as the recipient is not entitled to dividends during the requisite service period. In addition, during fiscal years 2015, 2016, and 2017, we granted performance-based restricted stock units that include a three-year market condition under a Long-Term Incentive Plan (“LTIP”) where the performance measurement period is three years. Vesting of the LTIP awards is based on our level of attainment of specified total shareholder return (TSR) targets relative to the percentage appreciation of a specified index of companies for the respective three-year periods and is also subject to the continued employment of the grantees. In order to estimate the fair value of such awards, we used a Monte Carlo Simulation valuation model. The performance measurement period related to the LTIP awards granted during fiscal year 2015 ended as of November 30, 2017. As the level of attainment of the specified TSR target was not met, none of the LTIP awards under this grant vested. The 1991 Employee Stock Purchase Plan (ESPP) permits eligible employees to purchase up to an aggregate of 9,450,000 shares of our common stock through accumulated payroll deductions. The ESPP has a 27-month offering period comprised of nine three-month purchase periods. The purchase price of the stock is equal to 85% of the lesser of the market value of such shares at the beginning of a 27-month offering period or the end of each three-month segment within such offering period. If the market price at any of the nine purchase periods is less than the market price on the first date of the 27-month offering period, subsequent to the purchase, the offering period is canceled and the employee is entered into a new 27-month offering period with the then current market price as the new base price. We issued 220,000 shares, 266,000 shares and 226,000 shares with weighted average purchase prices of $22.27, $20.01 and $19.58 per share, respectively, in fiscal years 2017, 2016 and 2015, respectively. At November 30, 2017, approximately 815,000 shares were available and reserved for issuance under the ESPP. We estimated the fair value of stock options and ESPP awards granted in fiscal years 2017, 2016 and 2015 on the measurement dates using the Black-Scholes option valuation model, and LTIP awards using the Monte Carlo Simulation valuation model, with the following weighted average assumptions:
For each stock option award, the expected life in years is based on historical exercise patterns and post-vesting termination behavior. Expected volatility is based on historical volatility of our stock, and the risk-free interest rate is based on the U.S. Treasury yield curve for the period that is commensurate with the expected life at the time of grant. The expected annual dividend yield is based on the weighted-average of the dividend yield assumptions used for options granted during the applicable period. For each ESPP award, the expected life in years is based on the period of time between the beginning of the offering period and the date of purchase, plus an additional holding period of three months. Expected volatility is based on historical volatility of our stock, and the risk-free interest rate is based on the U.S. Treasury yield curve in effect at each purchase period. The expected annual dividend yield is based on the weighted-average of the dividend yield assumptions used for options granted during the applicable period. Based on the above assumptions, the weighted average estimated fair value of stock options granted in fiscal years 2017, 2016, and 2015 was $5.95, $0 and $6.79 per share, respectively. We amortize the estimated fair value of stock options to expense over the vesting period using the straight-line method. The weighted average estimated fair value for shares issued under our ESPP in fiscal years 2017, 2016 and 2015 was $8.32, $7.43 and $6.89 per share, respectively. We amortize the estimated fair value of shares issued under the ESPP to expense over the vesting period using a graded vesting model. Total unrecognized stock-based compensation expense, net of expected forfeitures, related to unvested stock options and unvested restricted stock awards amounted to $24.5 million at November 30, 2017. These costs are expected to be recognized over a weighted average period of 2.2 years. The following additional activity occurred under our plans (in thousands):
The following table provides the classification of stock-based compensation as reflected in our consolidated statements of operations (in thousands):
Separation Arrangements During fiscal year 2017, we entered into separation agreements with three executives, which entitled them to accelerated vesting of certain stock-based awards. Due to the separation and accelerated vesting, we recognized additional stock-based compensation expense of $1.5 million, of which $0.8 million was recorded as sales and marketing expense and $0.7 million was recorded as general and administrative expense, in the consolidated statement of operations. During fiscal year 2016, we entered into separation agreements with two executives, which entitled them to accelerated vesting of certain stock-based awards. Due to the separation and accelerated vesting, we recognized additional stock-based compensation expense of $0.3 million, of which $0.2 million was recorded as sales and marketing expense and $0.1 million was recorded as product development expense, in the consolidated statement of operations. During fiscal year 2015, we entered into separation agreements with three executives, which entitled them to accelerated vesting of certain stock-based awards. Due to the separation and accelerated vesting, we recognized additional stock-based compensation expense of $0.3 million, of which $0.2 million was recorded as general and administrative expense and $0.1 million was recorded as sales and marketing expense, in the consolidated statement of operations. |
Retirement Plan |
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Nov. 30, 2017 | |
Retirement Benefits [Abstract] | |
Retirement Plan | Retirement Plan We maintain a retirement plan covering all U.S. employees under Section 401(k) of the Internal Revenue Code. Company contributions to the plan are at the discretion of the Board of Directors and totaled approximately $2.1 million, $2.5 million and $2.4 million for fiscal years 2017, 2016 and 2015, respectively. |
Restructuring |
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Restructuring Charges [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring | Restructuring The following table provides a summary of activity for all of the restructuring actions, which are detailed further below (in thousands):
2017 Restructuring During the first quarter of fiscal year 2017, we undertook certain operational restructuring initiatives intended to significantly reduce annual costs. As part of this action, management committed to a new strategic plan highlighted by a new product strategy and a streamlined operating approach. To execute these operational restructuring initiatives, we reduced our global workforce by over 20%. These workforce reductions occurred in substantially all functional units and across all geographies in which we operate. During the fourth quarter of fiscal year 2017, we incurred additional costs with respect to this restructuring, including reduction in redundant positions primarily within the product development and sales functions. We also consolidated offices in various locations during fiscal year 2017 and expect additional expenses related to facility closures during the first quarter of fiscal year 2018. We do not expect these additional costs to be material. Restructuring expenses are related to employee costs, including severance, health benefits and outplacement services (but excluding stock-based compensation), facilities costs, which include fees to terminate lease agreements and costs for unused space, net of sublease assumptions, and other costs, which include asset impairment charges. As part of this fiscal year 2017 restructuring, for the fiscal year ended November 30, 2017, we incurred expenses of $22.1 million, which are recorded as restructuring expenses in the consolidated statements of operations. A summary of activity for this restructuring action is as follows (in thousands):
Cash disbursements for expenses incurred to date under this restructuring are expected to be made through the first quarter of fiscal year 2019. The short-term portion of the restructuring reserve of $4.0 million is included in other accrued liabilities and the long-term portion of $0.1 million is included in other noncurrent liabilities on the consolidated balance sheet at November 30, 2017. 2016 Restructuring During the fourth quarter of fiscal year 2016, our management approved, committed to and initiated plans to make strategic changes to our organization as a result of the appointment of our new Chief Executive Officer during the period. In connection with the new organizational structure, we eliminated the positions of Chief Product Officer and Chief Revenue Officer. Restructuring expenses are related to employee costs, including severance, health benefits and outplacement services (but excluding stock-based compensation). As part of this fourth quarter restructuring, for the fiscal year ended November 30, 2017, we did not incur any expenses and do not expect to incur additional material costs with respect to this restructuring. For the fiscal year ended November 30, 2016, we incurred expenses of $1.5 million. The expenses are recorded as restructuring expenses in the consolidated statements of operations. A summary of activity for this restructuring action is as follows (in thousands):
2015 Restructurings During the first quarter of fiscal year 2015, we restructured our operations in connection with the acquisition of Telerik. This restructuring resulted in a reduction in redundant positions primarily within the administrative functions. This restructuring also resulted in the closing of two facilities as well as asset impairment charges for assets no longer deployed as a result of the acquisition. During the second and third quarters of fiscal year 2015, we incurred additional costs with respect to this restructuring, including reduction in redundant positions primarily within the product development function, as well as an impairment charge discussed further below. Restructuring expenses are related to employee costs, including severance, health benefits and outplacement services (but excluding stock-based compensation), facilities costs, which include fees to terminate lease agreements and costs for unused space, net of sublease assumptions, and other costs, which include asset impairment charges. During the second quarter of fiscal year 2015, we decided to replace our existing cloud-based mobile application development technology with technology acquired in connection with the acquisition of Telerik. Accordingly, we evaluated the ongoing value of the assets associated with this prior mobile technology and, based on this evaluation, we determined that the long-lived assets with a carrying amount of $4.0 million were no longer recoverable and were impaired and wrote them down to their estimated fair value of $0.1 million. Fair value was based on expected future cash flows using Level 3 inputs under ASC 820. As part of this first quarter restructuring, for the fiscal year ended November 30, 2017, we incurred minimal expenses. For the fiscal years ended November 30, 2016 and 2015, we incurred expenses of $0.3 million and $7.5 million, respectively. The expenses are recorded as restructuring expenses in the consolidated statements of operations. We do not expect to incur additional material costs with respect to this restructuring. A summary of activity for this restructuring action is as follows (in thousands):
During the fourth quarter of fiscal year 2015, our management approved, committed to and initiated plans to make strategic changes to our organization to enable stronger cross-collaboration among product management, marketing and sales teams and a tighter integration of the product management and product development teams. In connection with the new organizational structure, we eliminated the role of business segment president as well as certain other positions within the administrative organization. We also appointed a Chief Operating Officer, who assumed responsibility for driving the operations of our three segments. The organizational changes did not result in the closing of any of our facilities. Restructuring expenses are related to employee costs, including severance, health benefits and outplacement services (but excluding stock-based compensation), and other costs, which include charges for the abandonment of certain assets. As part of this fourth quarter restructuring, for the fiscal year ended November 30, 2017, we did not incur any expenses and do not expect to incur additional material costs with respect to this restructuring. For the fiscal year ended November 30, 2016, we recorded a minimal credit to restructuring expenses in the consolidated statements of operations due to changes in estimates of severance to be paid. For the fiscal year ended November 30, 2015, we incurred expenses of $4.1 million. The expenses are recorded as restructuring expenses in the consolidated statements of operations. A summary of activity for this restructuring action is as follows (in thousands):
2012 - 2014 Restructurings During fiscal years 2012, 2013, and 2014, our management approved, committed to and initiated plans to make strategic changes to our organization to provide greater focus and agility in the delivery of next generation application development, deployment and integration solutions. During each of these fiscal years, we took restructuring actions that involved the elimination of personnel and/or the closure of facilities. Restructuring expenses are related to employee costs, including severance, health benefits and outplacement services (but excluding stock-based compensation), and facilities costs, which include fees to terminate lease agreements and costs for unused space, net of sublease assumptions. As part of these restructuring actions, for the fiscal year ended November 30, 2017, we incurred minimal expenses. For the twelve months ended November 30, 2016, we recorded a minimal credit to restructuring expenses in the consolidated statements of operations primarily due to changes in estimates of severance to be paid. For the fiscal year ended November 30, 2015, we incurred expenses of $1.4 million. The expenses are recorded as restructuring expenses in the consolidated statements of operations. We do not expect to incur additional material costs with respect to the 2012, 2013, and 2014 restructuring actions. A summary of these restructuring actions is as follows (in thousands):
Cash disbursements for expenses incurred to date under these restructuring actions are expected to be made through the first quarter of fiscal year 2018. As a result, the total amount of the restructuring reserve, which is minimal, is included in other accrued liabilities on the consolidated balance sheet at November 30, 2017. |
Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The components of income before income taxes are as follows (in thousands):
The provision for income taxes is comprised of the following (in thousands):
A reconciliation of the income taxes incurred at the U.S. Federal statutory rate compared to the effective tax rate is as follows (in thousands):
During the preparation of our condensed consolidated financial statements for the three months ended May 31, 2016, we identified an error in our prior year income tax provision whereby income tax expense was overstated for the year ended November 30, 2015 by $2.7 million related to our tax treatment of an intercompany gain. We determined that the error is not material to the prior year financial statements. We also concluded that recording an out-of-period correction would not be material and therefore corrected this error by recording an out-of-period $2.7 million tax benefit in our interim financial statements for the periods ended May 31, 2016. The components of deferred tax assets and liabilities are as follows (in thousands):
The valuation allowance primarily applies to net operating loss carryforwards and unutilized tax credits in jurisdictions or under conditions where realization is not more likely than not. The $1.7 million decrease in the valuation allowance during fiscal year 2017 primarily relates to a foreign subsidiary that utilized net operating loss carryforwards in 2017 that had a valuation allowance recorded against them. The $5.0 million and $1.5 million decreases in the valuation allowance during fiscal years 2016 and 2015, respectively, primarily relate to the release of the valuation allowance on state research and development tax credits in fiscal year 2016 and foreign net operating loss carryforwards expiring unutilized in fiscal year 2015. At November 30, 2017, we have federal and foreign net operating loss carryforwards of $115.7 million expiring on various dates through 2034 and $0.8 million that may be carried forward indefinitely. In addition, we have state net operating loss carryforwards of $11.7 million expiring on various dates through 2022. At November 30, 2017, we have state tax credit carryforwards of approximately $3.0 million expiring on various dates through 2032 and $2.3 million that may be carried forward indefinitely. In addition, we have federal tax credit carryforwards of approximately $0.8 million expiring on various dates through 2034. It is our intention to indefinitely reinvest the earnings of our non-U.S. subsidiaries. We have not provided for U.S. income taxes on the undistributed earnings of non-U.S. subsidiaries, which totaled $13.8 million as of November 30, 2017, as these earnings have been indefinitely reinvested. Any additional taxes that might be payable upon repatriation of our foreign earnings would not be significant. As of November 30, 2017, the total amount of unrecognized tax benefits was $7.5 million, of which $4.5 million was recorded in other noncurrent liabilities on the consolidated balance sheet and $3.0 million of deferred tax assets, principally related to U.S and foreign net operating loss carry-forwards, have not been recorded. A reconciliation of the balance of our unrecognized tax benefits is as follows (in thousands):
If recognized, all amounts of unrecognized tax benefits would affect the effective tax rate. We recognize interest and penalties related to uncertain tax positions as a component of our provision for income taxes. In fiscal year 2017 estimated interest and penalties of $0.2 million were recorded to the provision for income taxes. In fiscal years 2016 and 2015 there was a minimal amount of estimated interest and penalties recorded in the provision for income taxes. We have accrued $0.5 million and $0.3 million of estimated interest and penalties at November 30, 2017 and 2016, respectively. We do not expect any significant changes to the amount of unrecognized tax benefits in the next twelve months. Our Federal income tax returns have been examined or are closed by statute for all years prior to fiscal year 2015. Our state income tax returns have been examined or are closed by statute for all years prior to fiscal year 2013, and we are no longer subject to audit for those periods. Tax authorities for certain non-U.S. jurisdictions are also examining returns, none of which are material to our consolidated balance sheets, cash flows or statements of income. With some exceptions, we are generally no longer subject to tax examinations in non-U.S. jurisdictions for years prior to fiscal year 2012. |
Earnings (Loss) Per Share |
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Earnings (Loss) Per Share | Earnings (Loss) Per Share We compute basic earnings (loss) per share using the weighted average number of common shares outstanding. We compute diluted earnings (loss) per share using the weighted average number of common shares outstanding plus the effect of outstanding dilutive stock options, restricted stock units and deferred stock units, using the treasury stock method. The following table sets forth the calculation of basic and diluted earnings per share from continuing operations (in thousands, expect per share data):
We excluded stock awards representing approximately 494,000 shares, 2,058,000 shares, and 2,552,000 shares of common stock from the calculation of diluted earnings per share in the fiscal years ended November 30, 2017, 2016 and 2015, respectively, because these awards were anti-dilutive. |
Business Segments and International Operations |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Segments and International Operations | Business Segments and International Operations Operating segments are components of an enterprise that engage in business activities for which discrete financial information is available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and assess performance. Our chief operating decision maker is our Chief Executive Officer. The changes made to our organization during fiscal years 2016 and 2017, as discussed in Note 13, did not change our determination of the three reportable segments as our organizational structure maintains the focus of the three business segments. We do not manage our assets or capital expenditures by segment or assign other income (expense) and income taxes to segments. We manage and report such items on a consolidated company basis. The following table provides revenue and contribution margin from our reportable segments and reconciles to the consolidated income from continuing operations before income taxes:
Our revenues are derived from licensing our products, and from related services, which consist of maintenance, hosting services, and consulting and education. Information relating to revenue from external customers by revenue type is as follows (in thousands):
In the following table, revenue attributed to the United States includes sales to customers in the U.S. and sales to certain multinational organizations. Revenue from Canada, Europe, the Middle East and Africa (EMEA), Latin America and the Asia Pacific region includes sales to customers in each region plus sales from the U.S. to distributors in these regions. Information relating to revenue from external customers from different geographical areas is as follows (in thousands):
No country outside of the U.S. accounted for more than 10% of our consolidated revenue in any year presented. Long-lived assets totaled $39.5 million, $45.4 million and $50.3 million in the U.S. and $2.8 million, $4.7 million and $3.9 million outside of the U.S. at the end of fiscal years 2017, 2016 and 2015, respectively. No individual country outside of the U.S. accounted for more than 10% of our consolidated long-lived assets. |
Selected Quarterly Financial Data (unaudited) |
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Selected Quarterly Financial Data (unaudited) | Selected Quarterly Financial Data (unaudited)
(1) Included within the loss from operations and net loss during the fourth quarter of fiscal 2016 is a $92 million impairment charge related to the goodwill of the Application Development and Deployment reporting unit. For further discussion on the impairment of goodwill, refer to Note 6. |
Related Party Transactions |
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Nov. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions During fiscal year 2017, we acquired 100% of the outstanding securities of MightyMeeting, Inc. ("MightyMeeting"), a mobile collaboration and social publishing platform, for $1.5 million. Dmitri Tcherevik, our Chief Technology Officer, was the founder and 50% owner of MightyMeeting. The transaction did not have a material impact on our financial condition or results of operations. The transaction has been accounted for as an asset acquisition and was executed with the intent of utilizing the collaboration and communication technology with our Kinvey and NativeScript offerings. In connection with the acquisition, we recorded a deferred tax liability resulting from the difference in book-to-tax basis of the acquired asset. As such, we recorded an intangible asset of $2.4 million, which includes a deferred tax liability of $0.9 million that will be amortized over five years beginning in the fourth quarter of fiscal year 2017. During fiscal year 2015, we entered into two license agreements with Emdeon Inc. (Emdeon) to provide Emdeon access to certain of our software. Philip M. Pead, our former President and Chief Executive Officer and former member of our Board of Directors, is a member of Emdeon’s board of directors. We deployed the software and recorded revenue of $0.4 million. We also recorded $0.2 million of deferred license and maintenance revenue related to the arrangements as of November 30, 2015, which will be recorded as revenue on a straight-line basis over the respective maintenance periods of each license agreement. As Emdeon paid us the total amounts upon deployment, there is no outstanding accounts receivable balance as of November 30, 2015. During fiscal year 2015, we also entered into two license agreements with a customer on whose board of directors one of our directors also serves. We delivered the software during the year and recorded revenue of $0.7 million. We also recorded a minimal amount of deferred maintenance revenue related to one of the arrangements, which was recorded as revenue on a straight-line basis over the remaining maintenance period. We did not enter into any material related party transactions during fiscal year 2016. |
Subsequent Events |
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Nov. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On December 22, 2017, the Tax Cuts and Jobs Act (the "New Tax Legislation") was signed into law. The New Tax Legislation had no impact on the Company’s operating results, cash flows and financial condition in the fiscal year ended November 30, 2017. The New Tax Legislation will impact the Company’s operating results, cash flows, and financial condition beginning in the fiscal year ended November 30, 2018 and the Company is currently evaluating the extent of the impact. The New Tax Legislation includes a number of provisions, including the reduction of the U.S. corporate tax rate from 35% to 21%, effective January 1, 2018. The New Tax Legislation also includes provisions that may partially offset the benefit of such rate reduction, including the repeal of the deduction for domestic production activities. As a result of the New Tax Legislation, we expect to realize a one-time tax benefit or expense for the re-measurement of deferred tax assets and liabilities. The effect of the international provisions of the New Tax Legislation, which generally establish a territorial-style system for taxing foreign-source income of domestic multinational corporations, are still being analyzed. Based on preliminary analysis, the deemed repatriation tax on unremitted foreign earnings and profits is not expected to have a material impact on our consolidated financial statements. |
Nature of Business and Summary of Significant Accounting Policies (Policies) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||
Accounting Principles | Accounting Principles We prepare our consolidated financial statements and accompanying notes in conformity with accounting principles generally accepted in the United States of America (GAAP). |
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Basis of Consolidation | Basis of Consolidation The consolidated financial statements include our accounts and those of our subsidiaries (all of which are wholly-owned). We eliminate all intercompany balances and transactions. |
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Use of Estimates | Use of Estimates The preparation of consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an on-going basis, management evaluates its estimates and records changes in estimates in the period in which they become known. These estimates are based on historical data and experience, as well as various other assumptions that management believes to be reasonable under the circumstances. The most significant estimates relate to the timing and amounts of revenue recognition, the realization of tax assets and estimates of tax liabilities, fair values of investments in marketable securities, intangible assets and goodwill valuations, the recognition and disclosure of contingent liabilities, the collectability of accounts receivable, and assumptions used to determine the fair value of stock-based compensation. Actual results could differ from those estimates. |
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Foreign Currency Translation | Foreign Currency Translation The functional currency of most of our foreign subsidiaries is the local currency in which the subsidiary operates. For foreign operations where the local currency is considered to be the functional currency, we translate assets and liabilities into U.S. dollars at the exchange rate on the balance sheet date. We translate income and expense items at average rates of exchange prevailing during each period. We accumulate translation adjustments in accumulated other comprehensive loss, a component of shareholders’ equity. For foreign operations where the U.S. dollar is considered to be the functional currency, we remeasure monetary assets and liabilities into U.S. dollars at the exchange rate on the balance sheet date and non-monetary assets and liabilities are remeasured into U.S. dollars at historical exchange rates. We translate income and expense items at average rates of exchange prevailing during each period. We recognize remeasurement adjustments currently as a component of foreign currency loss, net in the statements of operations. Transaction gains or losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in foreign currency loss, net in the statements of operations as incurred. |
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Cash Equivalents and Investments | Cash Equivalents and Investments Cash equivalents include short-term, highly liquid investments purchased with remaining maturities of three months or less. As of November 30, 2017, all of our cash equivalents were invested in money market funds. We classify investments, state and municipal bond obligations, U.S. treasury and government agency bonds, and corporate bonds and notes, as investments available-for-sale, which are stated at fair value. We include aggregate unrealized holding gains and losses, net of taxes, on available-for-sale securities as a component of accumulated other comprehensive loss in shareholders’ equity. We include realized gains and losses in interest income and other, net on the consolidated statements of operations. We monitor our investment portfolio for impairment on a periodic basis. In the event that the carrying value of an investment exceeds its fair value and the decline in value is determined to be other than temporary, an impairment charge is recorded and a new cost basis for the investment is established. In determining whether an other-than-temporary impairment exists, we consider the nature of the investment, the length of time and the extent to which the fair value has been less than cost, and our intent and ability to continue holding the security for a period sufficient for an expected recovery in fair value. |
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Allowance for Doubtful Accounts and Sales Credit Memos | Allowances for Doubtful Accounts and Sales Credit Memos We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of customers to make required payments. We establish this allowance using estimates that we make based on factors such as the composition of the accounts receivable aging, historical bad debts, changes in payment patterns, changes to customer creditworthiness and current economic trends. We also record an allowance for estimates of potential sales credit memos. This allowance is determined based on an analysis of historical credit memos issued and current economic trends, and is recorded as a reduction of revenue. |
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Concentrations of Credit Risk | Concentrations of Credit Risk Our financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments, derivative instruments and trade receivables. We have cash investment policies which, among other things, limit investments to investment-grade securities. We hold our cash and cash equivalents, investments and derivative instrument contracts with high quality financial institutions and we monitor the credit ratings of those institutions. We perform ongoing credit evaluations of our customers, and the risk with respect to trade receivables is further mitigated by the diversity, both by geography and by industry, of the customer base. |
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Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amount of our cash and cash equivalents, accounts receivable, accounts payable and long-term debt approximates fair value due to the short-term nature or market interest rates of these items. We base the fair value of short-term investments on quoted market prices or other relevant information generated by market transactions involving identical or comparable assets. We measure and record derivative financial instruments at fair value. See Note 4 for further discussion of financial instruments that are carried at fair value on a recurring and nonrecurring basis. |
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Derivative Instruments | Derivative Instruments We record all derivatives, whether designated in hedging relationships or not, on the consolidated balance sheets at fair value. We use derivative instruments to manage exposures to fluctuations in the value of foreign currencies, which exist as part of our ongoing business operations. Certain assets and forecasted transactions are exposed to foreign currency risk. Our objective for holding derivatives is to eliminate or reduce the impact of these exposures. We periodically monitor our foreign currency exposures to enhance the overall economic effectiveness of our foreign currency hedge positions. Principal currencies hedged include the euro, British pound, Brazilian real, Indian rupee, and Australian dollar. We do not enter into derivative instruments for speculative purposes, nor do we hold or issue any derivative instruments for trading purposes. We enter into certain derivative instruments that do not qualify for hedge accounting and are not designated as hedges. Although these derivatives do not qualify for hedge accounting, we believe that such instruments are closely correlated with the underlying exposure, thus managing the associated risk. The gains or losses from changes in the fair value of such derivative instruments that are not accounted for as hedges are recognized in earnings in foreign currency loss, net in the consolidated statements of operations. |
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Property and Equipment | Property and Equipment We record property and equipment at cost. We record property and equipment purchased in business combinations at fair value, which is then treated as the cost. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or the useful lives of the assets. Useful lives by major asset class are as follows: computer equipment and software, 3 to 7 years; buildings and improvements, 5 to 39 years; and furniture and fixtures, 5 to 7 years. Repairs and maintenance costs are expensed as incurred. |
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Product Development and Internal Use Software | Product Development and Internal Use Software Expenditures for product development, other than internal use software costs, are expensed as incurred. Product development expenses primarily consist of personnel and related expenses for our product development staff, the cost of various third-party contractor fees, and allocated overhead expenses. Software development costs associated with internal use software are incurred in three stages of development: the preliminary project stage, the application development stage, and the post-implementation stage. Costs incurred during the preliminary project and post-implementation stages are expensed as incurred. Certain internal and external qualifying costs incurred during the application development stage are capitalized as property and equipment. Internal use software is amortized on a straight-line basis over its estimated useful life of three years, beginning when the software is ready for its intended use. |
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Goodwill, Intangible Assets and Long-Lived Assets | Goodwill, Intangible Assets and Long-Lived Assets Goodwill is the amount by which the cost of acquired net assets in a business combination exceeded the fair value of net identifiable assets on the date of purchase. We evaluate goodwill and other intangible assets with indefinite useful lives, if any, for impairment annually or on an interim basis when events and circumstances arise that indicate impairment may have occurred. In performing our annual assessment, we first perform a qualitative test and if necessary, perform a quantitative test. To conduct the quantitative impairment test of goodwill, we compare the fair value of a reporting unit to its carrying value. If the reporting unit’s carrying value exceeds its fair value, we record an impairment loss to the extent that the carrying value of goodwill exceeds its implied fair value. We estimate the fair values of our reporting units using discounted cash flow models or other valuation models, such as comparative transactions and market multiples. We did not recognize any goodwill impairment charges during fiscal years 2017 or 2015. During fiscal year 2016, we recorded a $92.0 million goodwill impairment charge related to the Application Development and Deployment reporting unit (Note 6). Intangible assets are comprised of purchased technology, customer-related assets, and trademarks and trade names acquired through business combinations (Note 7). All of our intangible assets are amortized using the straight-line method over their estimated useful life. We periodically review long-lived assets (primarily property and equipment) and intangible assets with finite lives for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of those assets are no longer appropriate. We base each impairment test on a comparison of the undiscounted cash flows to the carrying value of the asset or asset group. If impairment is indicated, we write down the asset to its estimated fair value based on a discounted cash flow analysis. |
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Comprehensive Loss | Comprehensive (Loss) Income The components of comprehensive loss include, in addition to net income (loss), unrealized gains and losses on investments and foreign currency translation adjustments. |
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Revenue Recognition | Revenue Recognition We derive our revenue primarily from software licenses and maintenance and services. Our license arrangements generally contain multiple elements, including software maintenance services, consulting services, and customer education services. We do not recognize revenue until the following four basic criteria are met: (i) persuasive evidence of an arrangement exists, (ii) our product has been shipped or, if delivered electronically, the customer has the right to access the software, (iii) the fee is fixed or determinable, and (iv) collection of the fee is probable. Evidence of an arrangement generally consists of a contract or purchase order signed by the customer. In regard to delivery, we generally ship our software electronically and do not license our software with conditions of acceptance. If an arrangement does contain conditions of acceptance, we defer recognition of the revenue until the acceptance criteria are met or the period of acceptance has passed. Services are considered delivered as the work is performed or, in the case of maintenance, over the contractual service period. We assess whether a fee is fixed or determinable at the outset of the arrangement and consider the payment terms of the transaction, including transactions that extend beyond our customary payment terms. We do not license our software with a right of return. In assessing whether the collection of the fee is probable, we consider customer credit-worthiness, a customer’s historical payment experience, economic conditions in the customer’s industry and geographic location and general economic conditions. If we do not consider collection of a fee to be probable, we defer the revenue until the fees are collected, provided all other conditions for revenue recognition have been met. In determining when to recognize revenue from a customer arrangement, we are often required to exercise judgment regarding the application of our accounting policies to a particular arrangement. The primary judgments used in evaluating revenue recognized in each period involve: determining whether collection is probable, assessing whether the fee is fixed or determinable, and determining the fair value of the maintenance and services elements included in multiple-element software arrangements. Such judgments can materially impact the amount of revenue that we record in a given period. While we follow specific and detailed rules and guidelines related to revenue recognition, we make and use significant management judgments and estimates in connection with the revenue recognized in any reporting period, particularly in the areas described above. If management made different estimates or judgments, material differences in the timing of the recognition of revenue could occur. In regard to software license revenues, perpetual and term license fees are recognized as revenue when the software is delivered, no significant obligations or contingencies related to the software exist, other than maintenance, and all other revenue recognition criteria are met. We generally recognize revenue for products distributed through application partners and distributors on a sell-in basis. Revenue from maintenance is recognized ratably over the service period. Maintenance revenue is deferred until the associated license is delivered to the customer and all other criteria for revenue recognition have been met. Revenue from other services, which are primarily consulting and customer education services, is generally recognized as the services are delivered to the customer, provided all other criteria for revenue recognition have been met. We also offer products via a software-as-a-service (SaaS) model, which is a subscription based model. Subscription revenue derived from these agreements is generally recognized on a straight-line basis over the subscription term, provided persuasive evidence of an arrangement exists, access to our software has been granted to the customer, the fee for the subscription is fixed or determinable, and collection of the subscription fee is probable. We generally sell our software licenses with maintenance services and, in some cases, also with consulting services. For these multiple element arrangements, we allocate revenue to the delivered elements of the arrangement using the residual method, whereby revenue is allocated to the undelivered elements based on vendor specific objective evidence (or VSOE) of fair value of the undelivered elements with the remaining arrangement fee allocated to the delivered elements and recognized as revenue assuming all other revenue recognition criteria are met. For the undelivered elements, we determine VSOE of fair value to be the price charged when the undelivered element is sold separately. We determine VSOE for maintenance sold in connection with a software license based on the amount that will be separately charged for the maintenance renewal period. Substantially all license arrangements indicate the renewal rate for which customers may, at their option, renew their maintenance agreement. We determine VSOE for consulting services by reference to the amount charged for similar engagements when a software license sale is not involved. We review services sold separately on a periodic basis and update, when appropriate, our VSOE of fair value for such maintenance and services to ensure that it reflects our recent pricing experience. If VSOE of fair value for the undelivered elements cannot be established, we defer all revenue from the arrangement until the earlier of the point at which such sufficient VSOE does exist or all elements of the arrangement have been delivered, or if the only undelivered element is maintenance, then we recognize the entire fee ratably over the maintenance period. If payment of the software license fees is dependent upon the performance of consulting services or the consulting services are essential to the functionality of the licensed software, then we recognize both the software license and consulting fees using the completed contract method. Sales taxes collected from customers and remitted to government authorities are excluded from revenue. Deferred revenue generally results from contractual billings for which revenue has not been recognized and consists of the unearned portion of license, maintenance, and services fees. Deferred revenue expected to be recognized as revenue more than one year subsequent to the balance sheet date is included in long-term liabilities in the consolidated balance sheets. |
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Advertising Costs | Advertising Costs Advertising costs are expensed as incurred |
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Warranty Costs | Warranty Costs We make periodic provisions for expected warranty costs. Historically, warranty costs have been insignificant. |
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Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense reflects the fair value of stock-based awards, less the present value of expected dividends, measured at the grant date and recognized over the relevant service period. We estimate the fair value of each stock-based award on the measurement date using either the current market price of the stock, the Black-Scholes option valuation model, or the Monte Carlo Simulation valuation model. The Black-Scholes and Monte Carlo Simulation valuation models incorporate assumptions as to stock price volatility, the expected life of options or awards, a risk-free interest rate and dividend yield. We recognize stock-based compensation expense related to options and restricted stock units on a straight-line basis over the service period of the award, which is generally 4 or 5 years for options and 3 years for restricted stock units. We recognize stock-based compensation expense related to performance stock units and our employee stock purchase plan using an accelerated attribution method. |
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Acquisition-Related Costs | Acquisition-Related Costs Acquisition-related costs are expensed as incurred and include those costs incurred as a result of a business combination. These costs consist of professional services fees, including third-party legal and valuation-related fees, as well as retention fees and earn-out payments treated as compensation expense. |
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Restructuring Charges | Restructuring Charges Our restructuring charges are comprised primarily of costs related to property abandonment, including future lease commitments, net of any sublease income, and associated leasehold improvements; and employee termination costs related to headcount reductions. We recognize and measure restructuring liabilities initially at fair value when the liability is incurred. |
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Income Taxes | Income Taxes We provide for deferred income taxes resulting from temporary differences between financial and taxable income. We record valuation allowances to reduce deferred tax assets to the amount that is more likely than not to be realized. We recognize and measure uncertain tax positions taken or expected to be taken in a tax return utilizing a two-step approach. We first determine if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is that we measure the tax benefit as the largest amount that is more likely than not to be realized upon ultimate settlement. We recognize interest and penalties related to uncertain tax positions in our provision for income taxes on our consolidated statements of operations. |
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Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities (ASU 2017-12). ASU 2017-12 intends to better align an entity's risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The guidance in ASU 2017-12 is required for annual reporting periods beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the effect that implementation of this update will have upon adoption on our consolidated financial position and results of operations. In May 2017, the FASB issued Accounting Standards Update No. 2017-09, Compensation - Stock Compensation (Topic 718), Scope of Modification Accounting (ASU 2017-09), which amends the scope of modification accounting for share-based payment awards. The guidance in ASU 2017-09 provides that modification accounting is required only if a change in the terms or conditions of an award results in a change to the fair value, the vesting conditions, or the classification of the award as equity or liability. The guidance in ASU 2017-09 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. We are currently assessing the impact of the adoption of this standard on our consolidated financial position and results of operations. In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment (ASU 2017-04). ASU 2017-04 amends Topic 350 to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. This update requires the performance of an annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. However, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The guidance in ASU 2017-04 is required for annual reporting periods beginning after December 15, 2019, with early adoption permitted. We are currently considering whether to adopt this update prior to the required adoption date. In January 2017, the FASB issued Accounting Standards Update No. 2017-01, Business Combinations (Topic 805), Clarifying the Definition of a Business (ASU 2017-01). ASU 2017-01 provides a screen to determine when an integrated set of assets and activities is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. The guidance in ASU 2017-01 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. We adopted this update during the fourth quarter of fiscal year 2017 and the adoption did not have a material impact on our consolidated financial position and results of operations. In August 2016, the FASB issued Accounting Standards Update No. 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15). ASU 2016-15 is intended to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows and to eliminate the diversity in practice related to such classifications. The guidance in ASU 2016-15 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. We are currently evaluating the effect that implementation of this update will have upon adoption on our consolidated statement of cash flows. In March 2016, the FASB issued Accounting Standards Update No. 2016-09, Compensation - Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting (ASU 2016-09). ASU 2016-09 is intended to simplify various aspects of the accounting for employee share-based payment transactions, including accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The guidance in ASU 2016-09 is required for annual reporting periods beginning after December 15, 2016, with early adoption permitted. We are currently assessing the impact of the adoption of this standard on our consolidated financial position and results of operations. In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), which requires lessees to record most leases on their balance sheets, recognizing a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying asset for the lease term. The guidance in ASU 2016-02 is required for annual reporting periods beginning after December 15, 2018, with early adoption permitted. We currently expect that most of our operating lease commitments will be subject to the update and recognized as operating lease liabilities and right-of-use assets upon adoption. However, we are currently evaluating the effect that implementation of this update will have upon adoption on our consolidated financial position and results of operations. In April 2015, the FASB issued Accounting Standards Update No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30) Simplifying the Presentation of Debt Issuance Costs (ASU 2015-03). ASU 2015-03 requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. The guidance in ASU 2015-03 is required for annual reporting periods beginning after December 15, 2015, including interim periods within the reporting period. Accordingly, upon adoption in the first quarter of fiscal 2017, we reclassified $1.0 million from other assets to long-term debt in our consolidated balance sheet. Prior to fiscal year 2017 and the adoption of ASU 2015-03, the unamortized portion of debt issuance costs were recorded in other assets in our consolidated balance sheet. In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09). ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The guidance provided in Topic 606 requires entities to use a five-step model to recognize revenue by allocating the consideration from contracts to performance obligations on a relative standalone selling price basis. The standard also requires new disclosures regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. This new guidance was initially effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016 and early adoption was not permitted. However, in July 2015, the FASB voted to defer the effective date of this ASU by one year for reporting periods beginning after December 15, 2017, with early adoption permitted as of the original effective date. As a result, the effective date for the Company will be December 1, 2018. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance. The Company plans to adopt this ASU in accordance with the full retrospective approach, effective December 1, 2018. Fiscal year 2019 quarterly results, and comparative prior periods, will be prepared in accordance with ASC Topic 606. The first Annual Report on Form 10-K issued in accordance with ASC Topic 606 will be for the period ended November 30, 2019. Management is currently assessing the impact the adoption of this standard will have on the Company’s consolidated financial statements, but anticipates that the revenue recognition related to accounting for the following transactions will be most impacted:
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Nature of Business and Summary of Significant Accounting Policies (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowances Against Accounts Receivable | A summary of activity in the allowance for doubtful accounts is as follows (in thousands):
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Schedule of Activity in Allowance for Sales Credit Memos | A summary of activity in the allowance for sales credit memos is as follows (in thousands):
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Accumulated Other Comprehensive Loss | Accumulated other comprehensive loss by components, net of tax (in thousands):
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Cash, Cash Equivalents and Investments (Tables) |
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Investments and Cash [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Cash, Cash Equivalents and Trading and Available-for-sale Investments | A summary of our cash, cash equivalents and available-for-sale investments at November 30, 2017 is as follows (in thousands):
A summary of our cash, cash equivalents and available-for-sale investments at November 30, 2016 is as follows (in thousands):
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Summary of Cash, Cash Equivalents and Trading and Available-for-sale Investments by Balance Sheet Classification | Such amounts are classified on our consolidated balance sheets as follows (in thousands):
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Fair Value of Debt Securities by Contractual Maturity | The fair value of debt securities by contractual maturity is as follows (in thousands):
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Derivative Instruments (Tables) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding Foreign Currency Forward Contracts | The table below details outstanding foreign currency forward contracts where the notional amount is determined using contract exchange rates (in thousands):
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Fair Value Measurements (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements within the Fair Value Hierarchy of the Financial Assets | The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at November 30, 2017 (in thousands):
The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at November 30, 2016 (in thousands):
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Fair Value Measurements, Nonrecurring | The following table presents nonrecurring fair value measurements as of November 30, 2016 (in thousands):
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Property and Equipment (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property and Equipment | Property and equipment consists of the following (in thousands):
|
Intangible Assets and Goodwill (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Intangible Assets | Intangible assets are comprised of the following significant classes (in thousands):
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Schedule of Future Amortization Expense From Intangible Assets Held | Future amortization expense for intangible assets as of November 30, 2017 is as follows (in thousands):
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Summary of Changes In The Carrying Amount of Goodwill | Changes in the carrying amount of goodwill for fiscal years 2017 and 2016 are as follows (in thousands):
The additions to goodwill during fiscal year 2017 are related to the acquisitions of DataRPM in March 2017 and Kinvey in June 2017 (Note 7). Changes in the carrying amount of goodwill by reportable segment for fiscal year 2017 are as follows (in thousands):
|
Business Combinations (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition, Pro Forma Information | The pro forma financial information does not reflect any adjustments for anticipated synergies resulting from the acquisition and is not necessarily indicative of the operating results that would have actually occurred had the transaction been consummated on December 1, 2013.
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Kinvey, Inc. [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Business Acquisitions, by Acquisition | The allocation of the purchase price is as follows (in thousands):
|
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DataRPM Corporation [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Business Acquisitions, by Acquisition | The allocation of the purchase price is as follows (in thousands):
|
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Telerik AD [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Business Acquisitions, by Acquisition | The following table discloses the net assets acquired in the business combination (in thousands):
|
Term Loan and Line of Credit (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||
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Nov. 30, 2017 | |||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Schedule of Maturities of Long-term Debt | As of November 30, 2017, aggregate principal payments of long-term debt for the next five years and thereafter are (in thousands):
|
Commitments and Contingencies (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||
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Nov. 30, 2017 | |||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||
Future Minimum Rental Payments | Future minimum rental payments under these leases are as follows at November 30, 2017 (in thousands):
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Stock-Based Compensation (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Nov. 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Stock Option Activity | A summary of stock option activity under all the plans is as follows:
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Summary of Status of Restricted Stock Units | A summary of restricted stock units activity is as follows (in thousands, except per share data):
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Fair Value of Options and Employee Stock Purchase Plan Shares Granted, Weighted Average Assumptions | We estimated the fair value of stock options and ESPP awards granted in fiscal years 2017, 2016 and 2015 on the measurement dates using the Black-Scholes option valuation model, and LTIP awards using the Monte Carlo Simulation valuation model, with the following weighted average assumptions:
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Stock Options and Stock Awards Activity | The following additional activity occurred under our plans (in thousands):
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Classification of Stock-Based Compensation | The following table provides the classification of stock-based compensation as reflected in our consolidated statements of operations (in thousands):
|
Restructuring (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Nov. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Restructuring Activity | The following table provides a summary of activity for all of the restructuring actions, which are detailed further below (in thousands):
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2017 Restructuring Activities [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Restructuring Activity | A summary of activity for this restructuring action is as follows (in thousands):
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2016 Restructuring Activities [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Restructuring Activity | A summary of activity for this restructuring action is as follows (in thousands):
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2015 Restructuring Activities [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Restructuring Activity | A summary of activity for this restructuring action is as follows (in thousands):
A summary of activity for this restructuring action is as follows (in thousands):
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2012 - 2014 Restructuring Activities [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Restructuring Activity | A summary of these restructuring actions is as follows (in thousands):
|
Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Nov. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components Of Pretax Income | The components of income before income taxes are as follows (in thousands):
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Provisions For Income Taxes | The provision for income taxes is comprised of the following (in thousands):
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Reconciliation Of The U.S. Federal Statutory Rate To The Effective Tax Rate | A reconciliation of the income taxes incurred at the U.S. Federal statutory rate compared to the effective tax rate is as follows (in thousands):
|
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Summary Of Deferred Taxes | The components of deferred tax assets and liabilities are as follows (in thousands):
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Reconciliation Of Unrecognized Tax Benefits | A reconciliation of the balance of our unrecognized tax benefits is as follows (in thousands):
|
Earnings (Loss) Per Share (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Calculation of Basic and Diluted Earnings Per Share | The following table sets forth the calculation of basic and diluted earnings per share from continuing operations (in thousands, expect per share data):
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Business Segments and International Operations (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The following table provides revenue and contribution margin from our reportable segments and reconciles to the consolidated income from continuing operations before income taxes:
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Revenue from External Customers by Revenue Type | Information relating to revenue from external customers by revenue type is as follows (in thousands):
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Revenue from External Customers from Different Geographical Areas | Information relating to revenue from external customers from different geographical areas is as follows (in thousands):
|
Selected Quarterly Financial Data (unaudited) (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Selected Quarterly Financial Data |
|
Nature of Business and Summary of Significant Accounting Policies (Allowances Against Accounts Receivable) (Details) - Allowance for Doubtful Accounts [Member] - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Beginning balance | $ 741 | $ 1,421 | $ 1,646 |
Charge (credit) to costs and expenses | 204 | (256) | 271 |
Write-offs and other | (437) | (370) | (512) |
Translation adjustments | (10) | (54) | 16 |
Ending balance | $ 498 | $ 741 | $ 1,421 |
Nature of Business and Summary of Significant Accounting Policies (Allowance for Sales Credit Memos) (Details) - Allowance for Sales Credit Memos [Member] - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning balance | $ 402 | $ 772 | $ 946 |
(Credit) charge to revenue | (158) | (223) | 182 |
Write-offs and other | (69) | (144) | (332) |
Translation adjustments | 3 | (3) | (24) |
Ending balance | $ 178 | $ 402 | $ 772 |
Cash, Cash Equivalents and Investments (Fair Value of Debt Securities by Contractual Maturity) (Details) - USD ($) $ in Thousands |
Nov. 30, 2017 |
Nov. 30, 2016 |
---|---|---|
Investments and Cash [Abstract] | ||
Due in one year or less | $ 22,333 | $ 21,172 |
Due after one year | 27,812 | 21,546 |
Total | $ 50,145 | $ 42,718 |
Derivative Instruments (Narrative) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Derivative [Line Items] | |||
Derivative liabilities | $ 27 | $ 6,616 | |
Forward Contracts [Member] | |||
Derivative [Line Items] | |||
Minimum maturity period, foreign currency derivative | 30 days | ||
Maximum maturity period, foreign currency derivative | 366 days | ||
Gains (losses) on foreign currency option contracts | $ 9,400 | 4,000 | $ 4,600 |
Other Noncurrent Liabilities [Member] | |||
Derivative [Line Items] | |||
Derivative liabilities | $ 200 | 200 | |
Other Accrued Liabilities [Member] | |||
Derivative [Line Items] | |||
Derivative liabilities | $ 6,600 |
Derivative Instruments (Outstanding Foreign Currency Forward Contracts) (Details) - USD ($) $ in Thousands |
Nov. 30, 2017 |
Nov. 30, 2016 |
---|---|---|
Derivative [Line Items] | ||
Derivative contracts, notional value | $ 119,654 | $ 76,363 |
Derivative contracts, fair value | (27) | (6,616) |
Forward contracts to sell U.S. dollars [Member] | ||
Derivative [Line Items] | ||
Derivative contracts, notional value | 119,192 | 74,690 |
Derivative contracts, fair value | (27) | (6,597) |
Forward contracts to purchase U.S. dollars [Member] | ||
Derivative [Line Items] | ||
Derivative contracts, notional value | 462 | 1,673 |
Derivative contracts, fair value | $ 0 | $ (19) |
Property and Equipment (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 110,983 | $ 111,304 | |
Less accumulated depreciation and amortization | (68,722) | (61,199) | |
Property and equipment, net | 42,261 | 50,105 | |
Depreciation and amortization expense | 7,500 | 8,500 | $ 9,400 |
Computer Equipment and Software [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 50,588 | 47,978 | |
Land, Buildings and Leasehold Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 50,229 | 53,291 | |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 7,211 | 7,080 | |
Capitalized Software Development Costs [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 2,955 | $ 2,955 |
Intangible Assets and Goodwill (Schedule Of Intangible Assets) (Details) - USD ($) $ in Thousands |
Nov. 30, 2017 |
Nov. 30, 2016 |
---|---|---|
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross Carrying Amount | $ 239,843 | $ 192,628 |
Intangible Assets, Accumulated Amortization | (144,949) | (111,801) |
Total | 94,894 | 80,827 |
Purchased Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross Carrying Amount | 154,301 | 109,886 |
Intangible Assets, Accumulated Amortization | (88,224) | (68,116) |
Total | 66,077 | 41,770 |
Customer Related [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross Carrying Amount | 67,802 | 67,602 |
Intangible Assets, Accumulated Amortization | (46,230) | (35,852) |
Total | 21,572 | 31,750 |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross Carrying Amount | 17,740 | 15,140 |
Intangible Assets, Accumulated Amortization | (10,495) | (7,833) |
Total | $ 7,245 | $ 7,307 |
Intangible Assets and Goodwill (Narrative) (Details) - USD ($) |
3 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|
Nov. 30, 2017 |
Aug. 31, 2016 |
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Finite-Lived Intangible Assets [Line Items] | |||||
Intangible assets, amortization expense | $ 33,100,000 | $ 28,200,000 | $ 29,600,000 | ||
Goodwill [Line Items] | |||||
Impairment of goodwill and intangible assets | $ 0 | 92,000,000 | $ 0 | ||
Application Development and Deployment [Member] | |||||
Goodwill [Line Items] | |||||
Impairment of goodwill and intangible assets | $ 92,000,000 | 92,000,000 | |||
Modulus [Member] | Purchased Technology [Member] | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Impairment of intangible assets | $ 5,100,000 | $ 5,100,000 |
Intangible Assets and Goodwill (Schedule Of Future Amortization Expense From Intangible Assets Held) (Details) - USD ($) $ in Thousands |
Nov. 30, 2017 |
Nov. 30, 2016 |
---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2018 | $ 36,378 | |
2019 | 35,253 | |
2020 | 10,272 | |
2021 | 9,550 | |
2022 | 3,441 | |
Total | $ 94,894 | $ 80,827 |
Intangible Assets and Goodwill (Summary Of Changes In The Carrying Amount Of Goodwill) (Details) - USD ($) |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Goodwill [Roll Forward] | ||||
Balance, beginning of year | $ 278,067,000 | $ 369,985,000 | ||
Additions | 36,934,000 | 0 | ||
Impairment | 0 | (92,000,000) | $ 0 | |
Translation adjustments | 40,000 | 82,000 | ||
Balance, end of year | $ 315,041,000 | 315,041,000 | 278,067,000 | $ 369,985,000 |
OpenEdge [Member] | ||||
Goodwill [Roll Forward] | ||||
Balance, beginning of year | 212,062,000 | |||
Additions | 36,934,000 | |||
Translation adjustments | 40,000 | |||
Balance, end of year | 249,036,000 | 249,036,000 | 212,062,000 | |
Data Connectivity and Integration [Member] | ||||
Goodwill [Roll Forward] | ||||
Balance, beginning of year | 19,040,000 | |||
Additions | 0 | |||
Translation adjustments | 0 | |||
Balance, end of year | 19,040,000 | 19,040,000 | 19,040,000 | |
Application Development and Deployment [Member] | ||||
Goodwill [Roll Forward] | ||||
Balance, beginning of year | 46,965,000 | |||
Additions | 0 | |||
Impairment | (92,000,000) | (92,000,000) | ||
Translation adjustments | 0 | |||
Balance, end of year | $ 46,965,000 | $ 46,965,000 | $ 46,965,000 |
Business Combinations (Pro Forma Information) (Details) - Telerik AD [Member] $ / shares in Units, $ in Thousands |
12 Months Ended |
---|---|
Nov. 30, 2015
USD ($)
$ / shares
| |
Business Acquisition [Line Items] | |
Revenue | $ 367,811 |
Net loss | $ (30,007) |
Net loss per basic and diluted share (in dollars per share) | $ / shares | $ (0.59) |
Term Loan and Line of Credit - Future Maturities (Details) $ in Thousands |
Nov. 30, 2017
USD ($)
|
---|---|
Debt Disclosure [Abstract] | |
2018 | $ 6,188 |
2019 | 6,188 |
2020 | 9,281 |
2021 | 12,375 |
2022 | 89,718 |
Total | $ 123,750 |
Commitments and Contingencies (Future Minimum Rental Payments) (Details) $ in Thousands |
Nov. 30, 2017
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
2018 | $ 5,841 |
2019 | 5,172 |
2020 | 4,755 |
2021 | 2,201 |
2022 | 1,505 |
Thereafter | 3,717 |
Total | $ 23,191 |
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense, net of sub-rental income | $ 6.9 | $ 8.0 | $ 8.6 |
Stock-Based Compensation (Activity Stock Options and Stock Awards) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total intrinsic value of stock options on date exercised | $ 1,622 | $ 2,017 | $ 3,895 |
Total fair value of restricted stock units and deferred stock units on date vested | 20,089 | 17,213 | 18,714 |
Deferred Stock Unit [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total fair value of restricted stock units and deferred stock units on date vested | 57 | 0 | 93 |
Restricted Stock Units (RSUs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total fair value of restricted stock units and deferred stock units on date vested | $ 20,032 | $ 17,213 | $ 18,621 |
Retirement Plan (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Retirement Benefits [Abstract] | |||
Company contributions to the plan | $ 2.1 | $ 2.5 | $ 2.4 |
Income Taxes (Components Of Pretax Income) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Income Tax Disclosure [Abstract] | |||
U.S. | $ 77,442 | $ 78,477 | $ 62,813 |
Foreign | (11,855) | (113,757) | (50,459) |
Total | $ 65,587 | $ (35,280) | $ 12,354 |
Income Taxes (Provisions For Income Taxes) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Current: | |||
Federal | $ 23,739 | $ 12,934 | $ 18,418 |
State | 2,461 | 3,178 | 1,526 |
Foreign | 1,496 | 3,027 | 3,056 |
Total current | 27,696 | 19,139 | 23,000 |
Deferred: | |||
Federal | 1,548 | 6,203 | 2,199 |
State | 61 | (1,963) | 60 |
Foreign | (1,135) | (2,933) | (4,104) |
Total deferred | 474 | 1,307 | (1,845) |
Total | $ 28,170 | $ 20,446 | $ 21,155 |
Income Taxes (Reconciliation Of The U.S. Federal Statutory Rate To The Effective Tax Rate) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Income Tax Disclosure [Abstract] | |||
Tax at U.S. Federal statutory rate | $ 22,955 | $ (12,348) | $ 4,324 |
Foreign rate differences | 4,575 | 7,689 | 16,945 |
Effects of foreign operations included in U.S. Federal provision | (186) | (1,244) | (996) |
State income taxes, net | 1,702 | 2,977 | 1,029 |
Research credits | (251) | (838) | (681) |
Domestic production activities deduction | (2,670) | (1,925) | (1,750) |
Tax-exempt interest | (101) | (76) | (51) |
Nondeductible stock-based compensation | 808 | 740 | 1,875 |
Meals and entertainment | 276 | 234 | 321 |
Compensation subject to 162(m) | 208 | 0 | 228 |
Uncertain tax positions and tax settlements | 429 | (1,701) | (332) |
Prior period adjustment | 0 | (2,700) | 0 |
Release of valuation allowance on state research and development credits | 0 | (2,748) | 0 |
Goodwill Impairment | 0 | 32,200 | 0 |
Other | 425 | 186 | 243 |
Total | $ 28,170 | $ 20,446 | $ 21,155 |
Income Taxes (Summary Of Deferred Taxes) (Details) - USD ($) $ in Thousands |
Nov. 30, 2017 |
Nov. 30, 2016 |
---|---|---|
Deferred tax assets: | ||
Accounts receivable | $ 226 | $ 360 |
Other assets | 225 | 77 |
Accrued compensation | 5,456 | 3,267 |
Accrued liabilities and other | 5,402 | 3,207 |
Stock-based compensation | 1,160 | 4,377 |
Deferred revenue | 3,436 | 1,325 |
Tax credit and loss carryforwards | 31,441 | 23,167 |
Gross deferred tax assets | 47,346 | 35,780 |
Valuation allowance | (1,537) | (3,189) |
Total deferred tax assets | 45,809 | 32,591 |
Deferred tax liabilities: | ||
Goodwill | (26,484) | (23,685) |
Unrealized FX gains | (644) | (647) |
Depreciation and amortization | (20,367) | (5,559) |
Total deferred tax liabilities | (47,495) | (29,891) |
Total deferred tax liabilities, net | $ (1,686) | |
Total deferred tax assets, net | $ 2,700 |
Income Taxes (Reconciliation Of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | |||
Balance, beginning of year | $ 7,046 | $ 4,779 | $ 1,711 |
Tax positions related to current year | 785 | 1,106 | 107 |
Tax positions related to a prior period | (120) | ||
Tax positions related to a prior period | 1,638 | 0 | |
Settlements with tax authorities | (155) | (21) | (39) |
Tax positions acquired | 0 | 0 | 4,464 |
Lapses due to expiration of the statute of limitations | (36) | (456) | (1,464) |
Balance, end of year | $ 7,520 | $ 7,046 | $ 4,779 |
Earnings (Loss) Per Share (Narrative) (Details) - shares shares in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Earnings Per Share [Abstract] | |||
Number of shares excluded from the calculation of diluted earnings per share | 494 | 2,058 | 2,552 |
Earnings (Loss) Per Share (Calculation of Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2017 |
Aug. 31, 2017 |
May 31, 2017 |
Feb. 28, 2017 |
Nov. 30, 2016 |
Aug. 31, 2016 |
May 31, 2016 |
Feb. 29, 2016 |
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Earnings Per Share [Abstract] | |||||||||||
Net income (loss) | $ 16,429 | $ 11,172 | $ 10,341 | $ (525) | $ (73,793) | $ 7,576 | $ 7,275 | $ 3,216 | $ 37,417 | $ (55,726) | $ (8,801) |
Weighted average shares outstanding (in shares) | 48,129 | 49,481 | 50,391 | ||||||||
Dilutive impact from common stock equivalents (in shares) | 387 | 0 | 0 | ||||||||
Diluted weighted average shares outstanding (in shares) | 48,516 | 49,481 | 50,391 | ||||||||
Basic earnings (loss) per share (in dollars per share) | $ 0.35 | $ 0.23 | $ 0.21 | $ (0.01) | $ (1.52) | $ 0.16 | $ 0.15 | $ 0.06 | $ 0.78 | $ (1.13) | $ (0.17) |
Diluted earnings (loss) per share (in dollars per share) | $ 0.34 | $ 0.23 | $ 0.21 | $ (0.01) | $ (1.52) | $ 0.15 | $ 0.14 | $ 0.06 | $ 0.77 | $ (1.13) | $ (0.17) |
Business Segments and International Operations (Revenue from External Customers by Revenue Type) (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2017 |
Aug. 31, 2017 |
May 31, 2017 |
Feb. 28, 2017 |
Nov. 30, 2016 |
Aug. 31, 2016 |
May 31, 2016 |
Feb. 29, 2016 |
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Segment Reporting [Abstract] | |||||||||||
Software licenses | $ 124,406 | $ 134,863 | $ 130,250 | ||||||||
Maintenance | 241,398 | 238,377 | 217,718 | ||||||||
Professional services | 31,768 | 32,101 | 29,586 | ||||||||
Total revenue | $ 116,079 | $ 97,310 | $ 93,213 | $ 90,970 | $ 117,724 | $ 102,018 | $ 96,118 | $ 89,481 | $ 397,572 | $ 405,341 | $ 377,554 |
Business Segments and International Operations (Revenue from External Customers from Different Geographical Areas) (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2017 |
Aug. 31, 2017 |
May 31, 2017 |
Feb. 28, 2017 |
Nov. 30, 2016 |
Aug. 31, 2016 |
May 31, 2016 |
Feb. 29, 2016 |
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Revenue from External Customer [Line Items] | |||||||||||
Total revenue | $ 116,079 | $ 97,310 | $ 93,213 | $ 90,970 | $ 117,724 | $ 102,018 | $ 96,118 | $ 89,481 | $ 397,572 | $ 405,341 | $ 377,554 |
United States [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total revenue | 206,450 | 212,312 | 193,665 | ||||||||
Canada [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total revenue | 17,492 | 16,891 | 13,901 | ||||||||
EMEA [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total revenue | 130,359 | 130,818 | 124,171 | ||||||||
Latin America [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total revenue | 21,158 | 21,156 | 17,594 | ||||||||
Asia Pacific [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total revenue | $ 22,113 | $ 24,164 | $ 28,223 |
Business Segments and International Operations (Narrative) (Details) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Nov. 30, 2017
USD ($)
segment
|
Nov. 30, 2016
USD ($)
|
Nov. 30, 2015
USD ($)
|
|
Segment Reporting [Abstract] | |||
Number of reportable segments | segment | 3 | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | $ 42,261 | $ 50,105 | |
United States [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | 39,500 | 45,400 | $ 50,300 |
Outside United States [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | $ 2,800 | $ 4,700 | $ 3,900 |
Selected Quarterly Financial Data (unaudited) (Details) - USD ($) |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2017 |
Aug. 31, 2017 |
May 31, 2017 |
Feb. 28, 2017 |
Nov. 30, 2016 |
Aug. 31, 2016 |
May 31, 2016 |
Feb. 29, 2016 |
Nov. 30, 2017 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 116,079,000 | $ 97,310,000 | $ 93,213,000 | $ 90,970,000 | $ 117,724,000 | $ 102,018,000 | $ 96,118,000 | $ 89,481,000 | $ 397,572,000 | $ 405,341,000 | $ 377,554,000 |
Gross profit | 98,120,000 | 79,235,000 | 75,846,000 | 75,212,000 | 101,186,000 | 84,829,000 | 79,883,000 | 73,731,000 | 328,413,000 | 339,629,000 | 313,812,000 |
Income (loss) from operations | 28,809,000 | 20,299,000 | 20,284,000 | 1,222,000 | (62,364,000) | 13,606,000 | 12,344,000 | 6,705,000 | 70,614,000 | (29,709,000) | 14,754,000 |
Net income (loss) | $ 16,429,000 | $ 11,172,000 | $ 10,341,000 | $ (525,000) | $ (73,793,000) | $ 7,576,000 | $ 7,275,000 | $ 3,216,000 | $ 37,417,000 | $ (55,726,000) | $ (8,801,000) |
Basic earnings (loss) per share (in dollars per share) | $ 0.35 | $ 0.23 | $ 0.21 | $ (0.01) | $ (1.52) | $ 0.16 | $ 0.15 | $ 0.06 | $ 0.78 | $ (1.13) | $ (0.17) |
Diluted earnings (loss) per share (in dollars per share) | $ 0.34 | $ 0.23 | $ 0.21 | $ (0.01) | $ (1.52) | $ 0.15 | $ 0.14 | $ 0.06 | $ 0.77 | $ (1.13) | $ (0.17) |
Goodwill [Line Items] | |||||||||||
Impairment of goodwill and intangible assets | $ 0 | $ 92,000,000 | $ 0 | ||||||||
Application Development and Deployment [Member] | |||||||||||
Goodwill [Line Items] | |||||||||||
Impairment of goodwill and intangible assets | $ 92,000,000 | $ 92,000,000 |
Related Party Transactions (Details) |
12 Months Ended | |
---|---|---|
Nov. 30, 2017
USD ($)
|
Nov. 30, 2016
USD ($)
agreement
|
|
Licensing Agreements [Member] | Chief Executive Officer [Member] | ||
Related Party Transaction [Line Items] | ||
Number of license agreements entered into | agreement | 2 | |
Revenue from related parties | $ 400,000 | |
Deferred license and maintenance revenue | 200,000 | |
Accounts receivable from related party | $ 0 | |
Licensing Agreements [Member] | Director [Member] | ||
Related Party Transaction [Line Items] | ||
Number of license agreements entered into | agreement | 2 | |
Revenue from related parties | $ 700,000 | |
Might Meeting, Inc. [Member] | Acquisition of Affiliated Entity [Member] | ||
Related Party Transaction [Line Items] | ||
Equity interests (as a percent) | 100.00% | |
Consideration transferred | $ 1,500,000 | |
Intangible assets recognized | 2,400,000 | |
Deferred tax liability assumed | $ 900,000 | |
Deferred tax liability amortization period | 5 years |
Subsequent Events (Details) |
12 Months Ended | |
---|---|---|
Jan. 01, 2018 |
Nov. 30, 2017 |
|
Subsequent Event [Line Items] | ||
U.S. corporate tax rate (as a percent) | 35.00% | |
Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
U.S. corporate tax rate (as a percent) | 21.00% |
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