☑ | QUARTERLY 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 | 65-0694077 | |
(State or other jurisdiction of incorporation | (I.R.S. Employer Identification No.) | |
or organization) |
2000 Ultimate Way, Weston, FL | 33326 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | ☑ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☐ | (Do not check if a smaller reporting company) | Smaller reporting company | ☐ | ||
Emerging growth company | ☐ |
Page | |
Certifications |
ITEM 1. | Financial Statements |
As of June 30, 2017 | As of December 31, 2016 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 98,039 | $ | 73,773 | |||
Investments in marketable securities | 12,924 | 15,541 | |||||
Accounts receivable, net of allowance for doubtful accounts of $900 for 2017 and 2016 | 168,920 | 162,240 | |||||
Prepaid expenses and other current assets | 72,458 | 61,901 | |||||
Deferred tax assets, net | — | 1,125 | |||||
Total current assets before funds held for customers | 352,341 | 314,580 | |||||
Funds held for customers | 489,618 | 465,167 | |||||
Total current assets | 841,959 | 779,747 | |||||
Property and equipment, net | 220,589 | 179,558 | |||||
Goodwill | 35,563 | 35,322 | |||||
Investments in marketable securities | — | 8,547 | |||||
Intangible assets, net | 22,371 | 23,860 | |||||
Other assets, net | 50,995 | 47,432 | |||||
Deferred tax assets, net | 70,735 | 78,115 | |||||
Total assets | $ | 1,242,212 | $ | 1,152,581 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 13,835 | $ | 13,519 | |||
Accrued expenses and other liabilities | 38,562 | 50,973 | |||||
Deferred revenue | 184,408 | 171,669 | |||||
Capital lease obligations | 5,305 | 5,056 | |||||
Total current liabilities before customer funds obligations | 242,110 | 241,217 | |||||
Customer funds obligations | 491,661 | 466,423 | |||||
Total current liabilities | 733,771 | 707,640 | |||||
Deferred revenue | 2,547 | 2,307 | |||||
Deferred rent | 6,208 | 6,022 | |||||
Capital lease obligations | 4,707 | 3,985 | |||||
Other long-term liabilities | 4,875 | — | |||||
Deferred income tax liability | 441 | 519 | |||||
Total liabilities | 752,549 | 720,473 | |||||
Stockholders’ equity: | |||||||
Series A Junior Participating Preferred Stock, $.01 par value, 500,000 shares authorized, no shares issued or outstanding | — | — | |||||
Preferred Stock, $.01 par value, 2,000,000 shares authorized, no shares issued or outstanding | — | — | |||||
Common Stock, $.01 par value, 50,000,000 shares authorized, 34,479,553 and 34,003,036 shares issued as of 2017 and 2016, respectively | 345 | 340 | |||||
Additional paid-in capital | 565,326 | 520,524 | |||||
Accumulated other comprehensive loss | (6,611 | ) | (7,023 | ) | |||
Accumulated earnings | 141,962 | 129,626 | |||||
701,022 | 643,467 | ||||||
Treasury stock, 4,657,995 shares, at cost, for 2017 and 2016 | (211,359 | ) | (211,359 | ) | |||
Total stockholders’ equity | 489,663 | 432,108 | |||||
Total liabilities and stockholders’ equity | $ | 1,242,212 | $ | 1,152,581 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenues: | |||||||||||||||
Recurring | $ | 195,147 | $ | 158,479 | $ | 385,128 | $ | 311,230 | |||||||
Services | 29,545 | 28,058 | 68,055 | 62,521 | |||||||||||
Total revenues | 224,692 | 186,537 | 453,183 | 373,751 | |||||||||||
Cost of revenues: | |||||||||||||||
Recurring | 52,539 | 42,951 | 102,608 | 82,408 | |||||||||||
Services | 31,715 | 29,342 | 71,346 | 62,146 | |||||||||||
Total cost of revenues | 84,254 | 72,293 | 173,954 | 144,554 | |||||||||||
Gross profit | 140,438 | 114,244 | 279,229 | 229,197 | |||||||||||
Operating expenses: | |||||||||||||||
Sales and marketing | 67,015 | 54,548 | 136,375 | 111,130 | |||||||||||
Research and development | 34,997 | 29,053 | 71,155 | 56,568 | |||||||||||
General and administrative | 31,472 | 22,180 | 61,676 | 43,709 | |||||||||||
Total operating expenses | 133,484 | 105,781 | 269,206 | 211,407 | |||||||||||
Operating income | 6,954 | 8,463 | 10,023 | 17,790 | |||||||||||
Other (expense) income: | |||||||||||||||
Interest and other expense | (165 | ) | (180 | ) | (445 | ) | (364 | ) | |||||||
Other income, net | 81 | 102 | 307 | 205 | |||||||||||
Total other expense, net | (84 | ) | (78 | ) | (138 | ) | (159 | ) | |||||||
Income before income taxes | 6,870 | 8,385 | 9,885 | 17,631 | |||||||||||
Benefit (provision) for income taxes | (1,868 | ) | (2,263 | ) | 2,451 | (4,909 | ) | ||||||||
Net income | $ | 5,002 | $ | 6,122 | $ | 12,336 | $ | 12,722 | |||||||
Net income per share: | |||||||||||||||
Basic | $ | 0.17 | $ | 0.21 | $ | 0.42 | $ | 0.44 | |||||||
Diluted | $ | 0.16 | $ | 0.20 | $ | 0.40 | $ | 0.42 | |||||||
Weighted average shares outstanding: | |||||||||||||||
Basic | 29,751 | 28,895 | 29,645 | 28,860 | |||||||||||
Diluted | 30,623 | 30,240 | 30,639 | 30,240 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Net income | $ | 5,002 | $ | 6,122 | $ | 12,336 | $ | 12,722 | |||||||
Other comprehensive (loss) income: | |||||||||||||||
Unrealized (loss) gain on investments in marketable available-for-sale securities | (94 | ) | 47 | (324 | ) | 237 | |||||||||
Unrealized gain on foreign currency translation adjustments | 445 | 29 | 607 | 1,506 | |||||||||||
Other comprehensive income, before tax | 351 | 76 | 283 | 1,743 | |||||||||||
Income tax benefit (expense) related to items of other comprehensive income | 37 | (17 | ) | 129 | (93 | ) | |||||||||
Other comprehensive income, net of tax | $ | 388 | $ | 59 | $ | 412 | $ | 1,650 | |||||||
Comprehensive income | $ | 5,390 | $ | 6,181 | $ | 12,748 | $ | 14,372 |
For the Six Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 12,336 | $ | 12,722 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 16,551 | 12,575 | |||||
Provision for doubtful accounts | 3,364 | 2,136 | |||||
Non-cash stock-based compensation expense | 73,144 | 55,057 | |||||
Income taxes | (2,961 | ) | 4,671 | ||||
Net amortization of premiums and accretion of discounts on available-for-sale securities | 262 | 277 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (10,044 | ) | (19,097 | ) | |||
Prepaid expenses and other current assets | (10,557 | ) | (6,476 | ) | |||
Other assets | (3,563 | ) | (7,902 | ) | |||
Accounts payable | 316 | 1,494 | |||||
Accrued expenses, other liabilities and deferred rent | (2,333 | ) | (2,843 | ) | |||
Deferred revenue | 12,979 | 12,992 | |||||
Net cash provided by operating activities | 89,494 | 65,606 | |||||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (43,540 | ) | (33,643 | ) | |||
Payments for acquisitions | — | (9,125 | ) | ||||
Purchases of marketable securities | (122,625 | ) | (138,157 | ) | |||
Proceeds from sales and maturities of marketable securities | 73,069 | 56,130 | |||||
Net change in money market securities and other cash equivalents held to satisfy customer funds obligations | 35,684 | 71,972 | |||||
Net cash used in investing activities | (57,412 | ) | (52,823 | ) | |||
Cash flows from financing activities: | |||||||
Repurchases of Common Stock | — | (29,685 | ) | ||||
Net proceeds from issuances of Common Stock | 4,541 | 2,729 | |||||
Withholding taxes paid related to net share settlement of equity awards | (34,745 | ) | (18,564 | ) | |||
Principal payments on capital lease obligations | (3,148 | ) | (2,810 | ) | |||
Repayments of other borrowings | — | (200 | ) | ||||
Net change in customer funds obligations | 25,238 | 7,883 | |||||
Net cash used in financing activities | (8,114 | ) | (40,647 | ) | |||
Effect of exchange rate changes on cash | 298 | 857 | |||||
Net increase (decrease) in cash and cash equivalents | 24,266 | (27,007 | ) | ||||
Cash and cash equivalents, beginning of period | 73,773 | 109,325 | |||||
Cash and cash equivalents, end of period | $ | 98,039 | $ | 82,318 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid for interest | $ | 238 | $ | 208 | |||
Cash paid for taxes | $ | 1,048 | $ | 1,223 | |||
Non-cash investing and financing activities: | |||||||
Capital lease obligations to acquire new equipment | $ | 4,119 | $ | 4,112 | |||
Cash held in escrow for acquisitions | $ | — | $ | 1,000 | |||
Stock based compensation for capitalized software | $ | 2,021 | $ | 1,958 | |||
Software agreement | $ | 6,500 | $ | — |
1. | Nature of Operations |
2. | Basis of Presentation, Consolidation and the Use of Estimates |
3. | Summary of Significant Accounting Policies and Recent Accounting Pronouncements |
As of June 30, 2017 | As of December 31, 2016 | ||||||||||||||||||||||
Amortized Cost | Net Unrealized Gain/(Loss) | Fair Value (1) | Amortized Cost | Net Unrealized (Loss)/Gain | Fair Value (1) | ||||||||||||||||||
Type of issue: | |||||||||||||||||||||||
Funds held for customers – money market securities and other cash equivalents | $ | 280,669 | $ | — | $ | 280,669 | $ | 316,353 | $ | — | $ | 316,353 | |||||||||||
Available-for-sale securities: | |||||||||||||||||||||||
Corporate debentures – bonds | 4,185 | (4 | ) | 4,181 | 10,175 | (3 | ) | 10,172 | |||||||||||||||
Commercial paper | — | — | — | 1,446 | — | 1,446 | |||||||||||||||||
U.S. Agency bonds | 209,391 | (442 | ) | 208,949 | 148,939 | (125 | ) | 148,814 | |||||||||||||||
U.S. Treasury bills | 7,330 | (21 | ) | 7,309 | 9,586 | (18 | ) | 9,568 | |||||||||||||||
Asset-Backed securities | 1,436 | (2 | ) | 1,434 | 2,901 | 1 | 2,902 | ||||||||||||||||
Total corporate investments and funds held for customers | $ | 503,011 | $ | (469 | ) | $ | 502,542 | $ | 489,400 | $ | (145 | ) | $ | 489,255 |
Securities in unrealized loss position less than 12 months | Securities in unrealized loss position greater than 12 months | Total | ||||||||||||||||||||||
Gross unrealized losses | Fair market value | Gross unrealized losses | Fair market value | Gross unrealized losses | Fair market value | |||||||||||||||||||
Corporate debentures – bonds | $ | (4 | ) | $ | 4,181 | $ | — | $ | — | $ | (4 | ) | $ | 4,181 | ||||||||||
Commercial paper | — | — | — | — | — | — | ||||||||||||||||||
U.S. Agency bonds | (430 | ) | 195,572 | (12 | ) | 13,377 | (442 | ) | 208,949 | |||||||||||||||
U.S. Treasury bills | (21 | ) | 7,309 | — | — | (21 | ) | 7,309 | ||||||||||||||||
Asset-Backed securities | (2 | ) | 1,434 | — | — | (2 | ) | 1,434 | ||||||||||||||||
Total | $ | (457 | ) | $ | 208,496 | $ | (12 | ) | $ | 13,377 | $ | (469 | ) | $ | 221,873 |
Securities in unrealized loss position less than 12 months | Securities in unrealized loss position greater than 12 months | Total | ||||||||||||||||||||||
Gross unrealized losses | Fair market value | Gross unrealized losses | Fair market value | Gross unrealized losses | Fair market value | |||||||||||||||||||
Corporate debentures – bonds | $ | (4 | ) | $ | 6,125 | $ | — | $ | — | $ | (4 | ) | $ | 6,125 | ||||||||||
Commercial paper | — | — | — | — | — | — | ||||||||||||||||||
U.S. Agency bonds | (131 | ) | 118,810 | — | — | (131 | ) | 118,810 | ||||||||||||||||
U.S. Treasury bills | (18 | ) | 9,568 | — | — | (18 | ) | 9,568 | ||||||||||||||||
Asset-Backed securities | (1 | ) | 751 | — | — | (1 | ) | 751 | ||||||||||||||||
Total | $ | (154 | ) | $ | 135,254 | $ | — | $ | — | $ | (154 | ) | $ | 135,254 |
Corporate Investments | Investments with Funds Held for Customers | Total | ||||||||||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||||||||
Due in one year or less | $ | 12,952 | $ | 12,924 | $ | 135,501 | $ | 135,246 | $ | 148,453 | $ | 148,170 | ||||||||||||
Due after one year | — | — | 73,889 | 73,703 | 73,889 | 73,703 | ||||||||||||||||||
Total | $ | 12,952 | $ | 12,924 | $ | 209,390 | $ | 208,949 | $ | 222,342 | $ | 221,873 |
Corporate Investments | Investments with Funds Held for Customers | Total | ||||||||||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||||||||
Due in one year or less | $ | 15,546 | $ | 15,541 | $ | 104,688 | $ | 104,649 | $ | 120,234 | $ | 120,190 | ||||||||||||
Due after one year | 8,562 | 8,547 | 44,251 | 44,165 | 52,813 | 52,712 | ||||||||||||||||||
Total | $ | 24,108 | $ | 24,088 | $ | 148,939 | $ | 148,814 | $ | 173,047 | $ | 172,902 |
Level 1 - | Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets and liabilities. |
Level 2 - | Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly. |
Level 3 - | Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. |
As of June 30, 2017 | As of December 31, 2016 | ||||||||||||||||||||||||||||||
Total | (Level 1) | (Level 2) | (Level 3) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||||||||||
Corporate debentures – bonds | $ | 4,181 | $ | — | $ | 4,181 | $ | — | $ | 10,172 | $ | — | $ | 10,172 | $ | — | |||||||||||||||
Commercial paper | — | — | — | — | 1,446 | — | 1,446 | — | |||||||||||||||||||||||
U.S. Agency bonds | 208,949 | — | 208,949 | — | 148,814 | — | 148,814 | — | |||||||||||||||||||||||
U.S. Treasury bills | 7,309 | — | 7,309 | — | 9,568 | — | 9,568 | — | |||||||||||||||||||||||
Asset-Backed securities | 1,434 | — | 1,434 | — | 2,902 | — | 2,902 | — | |||||||||||||||||||||||
Total | $ | 221,873 | $ | — | $ | 221,873 | $ | — | $ | 172,902 | $ | — | $ | 172,902 | $ | — |
5. | Property and Equipment |
As of June 30, 2017 | As of December 31, 2016 | ||||||
Computer equipment | $ | 180,169 | $ | 166,420 | |||
Internal-use software | 147,714 | 113,407 | |||||
Leasehold improvements | 41,330 | 36,095 | |||||
Other property and equipment | 21,656 | 18,661 | |||||
Property and equipment | 390,869 | 334,583 | |||||
Less: accumulated depreciation and amortization | 170,280 | 155,025 | |||||
Property and equipment, net | $ | 220,589 | $ | 179,558 |
6. | Prepaid Expenses and Other Current Assets |
As of June 30, 2017 | As of December 31, 2016 | ||||||
Prepaid commissions on cloud sales | $ | 35,311 | $ | 29,842 | |||
Other prepaid expenses | 19,899 | 16,753 | |||||
Other current assets | 17,248 | 15,306 | |||||
Total prepaid expenses and other current assets | $ | 72,458 | $ | 61,901 |
7. | Goodwill and Intangible Assets |
Goodwill, December 31, 2016 | $ | 35,322 | |
Translation adjustment for the six months ended June 30, 2017 (1) | 241 | ||
Goodwill, June 30, 2017 | $ | 35,563 |
June 30, 2017 | |||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Cumulative Translation Adjustment (1) | Net Carrying Amount | Weighted Average Remaining Useful Life | |||||||||||||
Developed technology | $ | 23,300 | $ | (3,187 | ) | $ | (959 | ) | $ | 19,154 | 6.3 | ||||||
Customer relationships | 4,700 | (1,599 | ) | — | 3,101 | 4.9 | |||||||||||
Non-compete agreements | 300 | (300 | ) | — | — | 0.0 | |||||||||||
$ | 28,300 | $ | (5,086 | ) | $ | (959 | ) | $ | 22,255 | 6.1 | |||||||
December 31, 2016 | |||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Cumulative Translation Adjustment (1) | Net Carrying Amount | Weighted Average Remaining Useful Life | |||||||||||||
Developed technology | $ | 23,300 | $ | (2,036 | ) | $ | (1,026 | ) | $ | 20,238 | 6.7 | ||||||
Customer relationships | 4,700 | (1,194 | ) | — | 3,506 | 5.3 | |||||||||||
Non-compete agreements | 300 | (300 | ) | — | — | 0.0 | |||||||||||
$ | 28,300 | $ | (3,530 | ) | $ | (1,026 | ) | $ | 23,744 | 6.5 |
8. | Earnings Per Share |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||
Basic weighted average shares outstanding | 29,751 | 28,895 | 29,645 | 28,860 | |||||||
Effect of dilutive equity instruments | 872 | 1,345 | 994 | 1,380 | |||||||
Diluted weighted average shares outstanding | 30,623 | 30,240 | 30,639 | 30,240 | |||||||
Options to purchase shares of Common Stock and other stock-based awards outstanding which are not included in the calculation of diluted income per share because their impact is anti-dilutive | 1 | — | 5 | 3 |
9. | Foreign Currency |
10. | Stock-Based Compensation |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Non-cash stock-based compensation expense: | |||||||||||||||
Cost of recurring revenues | $ | 2,981 | $ | 2,168 | $ | 5,797 | $ | 4,098 | |||||||
Cost of services revenues | 1,935 | 1,476 | 3,924 | 3,021 | |||||||||||
Sales and marketing | 19,785 | 15,015 | 37,196 | 28,683 | |||||||||||
Research and development | 3,134 | 1,920 | 5,911 | 3,767 | |||||||||||
General and administrative | 11,443 | 8,064 | 20,316 | 15,488 | |||||||||||
Total non-cash stock-based compensation expense | $ | 39,278 | $ | 28,643 | $ | 73,144 | $ | 55,057 |
Stock Options | Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (in Years) | Aggregate Intrinsic Value | |||||||||
Outstanding at December 31, 2016 | 344 | $ | 28.76 | 1.1 | $ | 52,797 | |||||||
Granted | — | — | 0 | — | |||||||||
Exercised | (159 | ) | 28.52 | 0 | — | ||||||||
Forfeited or expired | — | — | 0 | — | |||||||||
Outstanding at June 30, 2017 | 185 | $ | 28.98 | 0.8 | $ | 33,413 | |||||||
Exercisable at June 30, 2017 | 185 | $ | 28.98 | 0.8 | $ | 33,413 |
For the Three Months Ended June 30, | ||||||
2017 | 2016 | |||||
Restricted Stock Awards: | ||||||
Non-Employee Directors | 4 | 2 | ||||
Total Restricted Stock Awards Granted | 4 | 2 | ||||
Restricted Stock Unit Awards: | ||||||
Non-Senior Officers and Other Employees | 13 | 28 | ||||
Total Restricted Stock Unit Awards Granted | 13 | 28 |
For the Three Months Ended June 30, | ||||||||||||||||
2017 | 2016 | |||||||||||||||
Shares Vested | Shares Retained (1) | Amount Retained (in millions) (1) | Shares Issued | Shares Vested | Shares Retained (1) | Amount Retained (in millions) (1) | Shares Issued | |||||||||
Restricted Stock Awards: | ||||||||||||||||
Non-Employee Directors | 24 | — | $0.0 | 24 | 6 | — | $0.0 | 6 | ||||||||
Total Restricted Stock Awards | 24 | — | $0.0 | 24 | 6 | — | $0.0 | 6 | ||||||||
Restricted Stock Unit Awards: | ||||||||||||||||
Non-Senior Officers and Other Employees | 15 | 5 | $1.2 | 9 | 10 | 4 | $0.7 | 6 | ||||||||
Total Restricted Stock Unit Awards | 15 | 5 | $1.2 | 9 | 10 | 4 | $0.7 | 6 |
Restricted Stock Awards | Restricted Stock Unit Awards | |||||||||||||
Shares | Weighted Average Grant Date Fair Value | Shares | Weighted Average Grant Date Fair Value | |||||||||||
Outstanding at December 31, 2016 | 1,161 | $ | 164.77 | 562 | $ | 170.73 | ||||||||
Granted | 361 | 195.81 | 288 | 196.25 | ||||||||||
Vested and released | (309 | ) | 158.18 | (187 | ) | 161.02 | ||||||||
Forfeited or expired | — | — | (13 | ) | 184.19 | |||||||||
Outstanding at June 30, 2017 | 1,213 | $ | 175.68 | 650 | $ | 184.55 |
ITEM 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||
Revenues: | |||||||||||
Recurring | 86.9 | % | 85.0 | % | 85.0 | % | 83.3 | % | |||
Services | 13.1 | 15.0 | 15.0 | 16.7 | |||||||
Total revenues | 100.0 | 100.0 | 100.0 | 100.0 | |||||||
Cost of revenues: | |||||||||||
Recurring | 23.4 | 23.0 | 22.6 | 22.1 | |||||||
Services | 14.1 | 15.8 | 15.8 | 16.6 | |||||||
Total cost of revenues | 37.5 | 38.8 | 38.4 | 38.7 | |||||||
Gross profit | 62.5 | 61.2 | 61.6 | 61.3 | |||||||
Operating expenses: | |||||||||||
Sales and marketing | 29.8 | 29.2 | 30.1 | 29.7 | |||||||
Research and development | 15.6 | 15.6 | 15.7 | 15.1 | |||||||
General and administrative | 14.0 | 11.9 | 13.6 | 11.7 | |||||||
Total operating expenses | 59.4 | 56.7 | 59.4 | 56.5 | |||||||
Operating income | 3.1 | 4.5 | 2.2 | 4.8 | |||||||
Other (expense) income: | |||||||||||
Interest expense and other | (0.1 | ) | (0.1 | ) | (0.1 | ) | (0.1 | ) | |||
Other income, net | 0.1 | 0.1 | 0.1 | — | |||||||
Total other expense, net | — | — | — | (0.1 | ) | ||||||
Income before income taxes | 3.1 | 4.5 | 2.2 | 4.7 | |||||||
Provision for income taxes | (0.9 | ) | (1.2 | ) | 0.5 | (1.3 | ) | ||||
Net income | 2.2 | % | 3.3 | % | 2.7 | % | 3.4 | % |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Cost of recurring revenues | $ | 2,981 | $ | 2,168 | $ | 5,797 | $ | 4,098 | |||||||
Cost of services revenues | 1,935 | 1,476 | 3,924 | 3,021 | |||||||||||
Sales and marketing | 19,785 | 15,015 | 37,196 | 28,683 | |||||||||||
Research and development | 3,134 | 1,920 | 5,911 | 3,767 | |||||||||||
General and administrative | 11,443 | 8,064 | 20,316 | 15,488 | |||||||||||
Total stock-based compensation expense | $ | 39,278 | $ | 28,643 | $ | 73,144 | $ | 55,057 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Stock-based compensation expense: | |||||||||||||||
Stock-based compensation expense | $ | 22,433 | $ | 17,581 | $ | 42,245 | $ | 34,665 | |||||||
Stock-based compensation expense related to CIC Modifications | 16,845 | 11,062 | 30,899 | 20,392 | |||||||||||
Total non-cash stock-based compensation expense | $ | 39,278 | $ | 28,643 | $ | 73,144 | $ | 55,057 |
• | For the three months ended June 30, 2017, the increase in cloud costs were principally as a result of the growth in cloud operations from increased sales, including increased labor costs and, to a lesser extent, increased variable costs associated with our cloud operations. |
• | The increases in Customer Support costs for the three and six months ended June 30, 2017 were primarily due to higher labor costs commensurate with the growth in the number of cloud customers serviced. |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Non-GAAP operating income reconciliation: | ||||||||||||||||
Operating income | $ | 6,954 | $ | 8,463 | $ | 10,023 | $ | 17,790 | ||||||||
Operating income, as a % of total revenues | 3.1 | % | 4.5 | % | 2.2 | % | 4.8 | % | ||||||||
Add back: | ||||||||||||||||
Non-cash stock-based compensation expense | 39,278 | 28,643 | 73,144 | 55,057 | ||||||||||||
Non-cash amortization of acquired intangible assets | 776 | 257 | 1,556 | 504 | ||||||||||||
Non-GAAP operating income | $ | 47,008 | $ | 37,363 | $ | 84,723 | $ | 73,351 | ||||||||
Non-GAAP operating income, as a % of total revenues | 20.9 | % | 20.0 | % | 18.7 | % | 19.6 | % |
ITEM 3. | Quantitative and Qualitative Disclosures About Market Risk |
• | Maximum safety of principal; |
• | Maintenance of appropriate liquidity for regular cash needs; |
• | Maximum yields in relationship to guidelines and market conditions; |
• | Diversification of risks; and |
• | Fiduciary control of all investments. |
ITEM 4. | Controls and Procedures |
ITEM 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) | Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (2) | |||||
April 1 - 30, 2017 | — | $— | 4,657,995 | 1,342,005 | ||||
May 1 - 31, 2017 | 5,352 (1) | $210.84 | 4,657,995 | 1,342,005 | ||||
June 1 - 31, 2017 | 105 (1) | $213.12 | 4,657,995 | 1,342,005 | ||||
__________________ | ||||||||
(1) Represents 5,457 shares of Common Stock that were acquired by us at the fair market value of the Common Stock as of the period stated, in connection with the satisfaction of our employees' tax withholding liability resulting from the vesting of restricted stock holdings. | ||||||||
(2) Under a stock repurchase plan originally announced on October 30, 2000, and subsequently amended from time to time, Ultimate is authorized to purchase up to 6,000,000 shares of its Common Stock. As of June 30, 2017, Ultimate had purchased 4,657,995 shares of Common Stock under our stock repurchase plan, with 1,342,005 shares being available for repurchase in the future. There were no purchases of Common Stock under the stock repurchase plan for the three months ended June 30, 2017. |
ITEM 6. | Exhibits |
Number | Description | |
101.1 | Interactive Data Files pursuant to Rule 405 of Regulation S-T: (i) Unaudited Condensed Consolidated Balance Sheets as of June 30, 2017 and December 31, 2016, (ii) Unaudited Condensed Consolidated Statements of Income for the Three and Six Months Ended June 30, 2017 and June 30, 2016, (iii) Unaudited Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2017 and June 30, 2016, (iv) Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2017 and June 30, 2016 and (v) Notes to Unaudited Condensed Consolidated Financial Statements.* |
The Ultimate Software Group, Inc. | |||
Date: | August 8, 2017 | By: | /s/ Mitchell K. Dauerman |
Executive Vice President, Chief Financial Officer and Treasurer (Authorized Signatory and Principal Financial and Accounting Officer) |
1. | I have reviewed this Form 10-Q of The Ultimate Software Group, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The Registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
1. | I have reviewed this Form 10-Q of The Ultimate Software Group, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The Registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
Document And Entity Information - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jul. 31, 2017 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Ultimate Software Group Inc | |
Entity Central Index Key | 0001016125 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 29,827,383 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q2 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2017 |
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Jun. 30, 2016 |
---|---|---|
Current Assets: | ||
Allowance for doubtful accounts | $ 900 | $ 900 |
Stockholders’ equity: | ||
Preferred Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred Stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 50,000,000 | 50,000,000 |
Common Stock, shares issued | 34,479,553 | 34,003,036 |
Treasury Stock, shares | 4,657,995 | 4,657,995 |
Series A Junior Preferred Stock | ||
Stockholders’ equity: | ||
Preferred Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred Stock, shares authorized | 500,000 | 500,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Revenues: | ||||
Recurring | $ 195,147 | $ 158,479 | $ 385,128 | $ 311,230 |
Services | 29,545 | 28,058 | 68,055 | 62,521 |
Total revenues | 224,692 | 186,537 | 453,183 | 373,751 |
Cost of revenues: | ||||
Recurring | 52,539 | 42,951 | 102,608 | 82,408 |
Services | 31,715 | 29,342 | 71,346 | 62,146 |
Total cost of revenues | 84,254 | 72,293 | 173,954 | 144,554 |
Gross profit | 140,438 | 114,244 | 279,229 | 229,197 |
Operating expenses: | ||||
Sales and marketing | 67,015 | 54,548 | 136,375 | 111,130 |
Research and development | 34,997 | 29,053 | 71,155 | 56,568 |
General and administrative | 31,472 | 22,180 | 61,676 | 43,709 |
Total operating expenses | 133,484 | 105,781 | 269,206 | 211,407 |
Operating income | 6,954 | 8,463 | 10,023 | 17,790 |
Other (expense) income: | ||||
Interest and other expense | (165) | (180) | (445) | (364) |
Other income, net | 81 | 102 | 307 | 205 |
Total other expense, net | (84) | (78) | (138) | (159) |
Income before income taxes | 6,870 | 8,385 | 9,885 | 17,631 |
Benefit (provision) for income taxes | (1,868) | (2,263) | 2,451 | (4,909) |
Net income | $ 5,002 | $ 6,122 | $ 12,336 | $ 12,722 |
Net income per share: | ||||
Basic (in dollars per share) | $ 0.17 | $ 0.21 | $ 0.42 | $ 0.44 |
Diluted (in dollars per share) | $ 0.16 | $ 0.20 | $ 0.40 | $ 0.42 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 29,751 | 28,895 | 29,645 | 28,860 |
Diluted (in shares) | 30,623 | 30,240 | 30,639 | 30,240 |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net Income | $ 5,002 | $ 6,122 | $ 12,336 | $ 12,722 |
Other comprehensive (loss) income: | ||||
Unrealized (loss) gain on investments in marketable available-for-sale securities | (94) | 47 | (324) | 237 |
Unrealized gain on foreign currency translation adjustments | 445 | 29 | 607 | 1,506 |
Other comprehensive income, before tax | 351 | 76 | 283 | 1,743 |
Income tax benefit (expense) related to items of other comprehensive income | 37 | (17) | 129 | (93) |
Other comprehensive income, net of tax | 388 | 59 | 412 | 1,650 |
Comprehensive income | $ 5,390 | $ 6,181 | $ 12,748 | $ 14,372 |
Nature of Operations |
6 Months Ended |
---|---|
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Nature of Operations The Ultimate Software Group, Inc. and subsidiaries (“Ultimate,” “we,” “us” or “our”) is a leading cloud provider of people management solutions, often referred to as human capital management (“HCM”). Ultimate's UltiPro product suite (“UltiPro”) is a comprehensive, engaging solution that has human resources ("HR"), payroll, and benefits management at its core and includes global people management, available in twelve languages with more than 35 country-specific localizations. The solution is delivered via software-as-a-service to organizations based in the United States and Canada, including those with global workforces. UltiPro is designed to deliver the functionality businesses need to manage the complete employment life cycle from recruitment to retirement. We market our UltiPro solutions primarily to enterprise companies, which we define as organizations with 2,501 or more employees, including those with 10,000 or more employees; mid-market companies, which we define as those having 501-2,500 employees; and strategic market companies, which we define as those having 100-500 employees. UltiPro is marketed primarily through our enterprise, mid-market and strategic direct sales teams. |
Basis of Presentation, Consolidation and the Use of Estimates |
6 Months Ended |
---|---|
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation, Consolidation and the Use of Estimates | Basis of Presentation, Consolidation and the Use of Estimates The accompanying unaudited condensed consolidated financial statements of Ultimate have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The information in this quarterly report should be read in conjunction with Ultimate’s audited consolidated financial statements and notes thereto included in Ultimate’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016 filed with the SEC on February 24, 2017 (the “Form 10-K”). The unaudited condensed consolidated financial statements included herein reflect all adjustments (consisting only of normal, recurring adjustments) which are, in the opinion of Ultimate’s management, necessary for a fair presentation of the information for the periods presented. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Interim results of operations for the three and six months ended June 30, 2017 are not necessarily indicative of operating results for the full fiscal year or for any future periods. The unaudited condensed consolidated financial statements reflect the financial position and operating results of Ultimate and include its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. |
Summary of Significant Accounting Policies and Recent Accounting Pronouncements |
6 Months Ended |
---|---|
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies and Recent Accounting Pronouncements | Summary of Significant Accounting Policies and Recent Accounting Pronouncements Summary of Significant Accounting Policies Ultimate’s significant accounting policies discussed in Note 3 to its audited consolidated financial statements for the fiscal year ended December 31, 2016, included in the Form 10-K, have not significantly changed. In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2016-09, “Improvements to Employee Share-Based Payment Accounting” (“ASU 2016-09”). The standard amends the accounting for certain aspects of share-based payments to employees. We elected to early adopt the new guidance in the third quarter of fiscal year 2016. Therefore, the prior year numbers in our unaudited condensed consolidated statements of income, our unaudited condensed consolidated statements of comprehensive income, our unaudited condensed consolidated statement of cash flows, our non-GAAP financial measures and our notes to unaudited condensed financial statements reflect revised numbers in accordance with the adoption of this guidance. Our unaudited condensed consolidated balance sheets were not impacted. Fair Value of Financial Instruments Ultimate's financial instruments, consisting of cash and cash equivalents, investments in marketable securities, funds held for customers and the related obligations, accounts receivable, accounts payable, capital lease obligations and other long-term liabilities, approximated fair value (due to their relatively short maturity) as of June 30, 2017 and December 31, 2016. Recently Issued Accounting Standards In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers ("Topic 606)”. Topic 606 supersedes the revenue requirements in ASU Topic 605, Revenue Recognition ("Topic 605") and requires the recognition of revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services and includes Subtopic 340-40, Other Assets and Deferred Costs - Contracts with Customers, which discusses the deferral if incremental costs of obtaining a contract with a customer, including the period of amortization of such costs. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. Collectively, we refer to Topic 606 and Subtopic 340-40 as the "new standard". Topic 606 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation, among others. We began assessing the new standard in 2016 and have continued our assessment during the first half of 2017 to address the potential impact that Topic 606 could have on our unaudited condensed consolidated financial statements and the required resources to implement the new standard. Our assessment of the impact included an evaluation of the five step process along with the enhancement of disclosures that will be required under the new standard. We have developed our initial plan for implementing the new standard, which includes, but is not limited to, identifying contract populations and "in scope" customer contracts, identifying performance obligations in those customer contracts, and evaluating any impact of variable consideration. Our assessment also includes determining the impact the new standard may have on the revenue reporting processes, including disclosures, ensuring internal controls will operate effectively with the new standard and performing gap analyses on collected data and determining the relative accounting positions where applicable. Included in our assessment of the new standard, we will focus on the potential impact on sales commissions and the term over which they will amortize. We anticipate this standard will not have a material impact on the way we recognize revenues. The new standard will require us to defer incremental commission costs to obtain related subscription contracts over the period of benefit. While we are still assessing the period of benefit, we have concluded that it will be longer than the amortization period under existing GAAP. Under current GAAP, we defer only direct and incremental commission costs to obtain a contract and amortize those costs over the term of the related subscription contract, which is generally 2-3 years. We are still evaluating the overall effect the standard will have on the unaudited condensed consolidated financial statements and related disclosures. Topic 606 is effective for Ultimate on January 1, 2018 using either of two transition methods including several practical expedients: (1) full retrospective method, in which the new standard would be applied to each prior reporting period presented or (2) the modified retrospective method, in which the cumulative effect of initially applying the new standard would be recognized at the date of initial application and providing certain additional disclosures as defined per the new standard. Ultimate has not yet selected a transition method. In February 2016, the FASB issued ASU 2016-02, "Leases" ("ASU 2016-02"), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The new standard is effective for Ultimate on January 1, 2019 and early adoption is permitted. The standard requires lessees and lessors to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. We are evaluating the effect that ASU 2016-02 will have on our unaudited condensed consolidated financial statements and related disclosures. We have not yet determined the effect the standard will have on our ongoing financial reporting. Recently Adopted Accounting Standards In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): "Balance Sheet Classification of Deferred Taxes" ("ASU 2015-17”). ASU 2015-17 requires entities to offset all deferred tax assets and liabilities (and valuation allowances) for each tax-paying jurisdiction within each tax-paying component and present the net deferred tax as a single noncurrent amount in a classified balance sheet. Effective January 1, 2017 the Company adopted ASU 2015-17. Subsequent to adoption, all deferred tax assets and deferred tax liabilities are presented as noncurrent on the balance sheet. The changes have been applied prospectively as permitted by the ASU and prior years have not been restated. The adoption of this ASU does not have a material effect on the Company's results of operations, financial condition or liquidity. |
Funds held for Customers, Corporate Investments in Marketable Securities and Fair Value of Financial Instruments |
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Investments in Marketable Securities and Fair Value of Financial Instruments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Funds held for Customers, Corporate Investments in Marketable Securities and Fair Value of Financial Instruments | Investments in Marketable Securities and Fair Value of Financial Instruments We classify our investments in marketable securities with readily determinable fair values as available-for-sale. Available-for-sale securities consist of debt and equity securities not classified as trading securities or as securities to be held to maturity. Unrealized gains and losses, net of tax, on available-for-sale securities are reported as a net amount in accumulated other comprehensive loss in stockholders’ equity until realized. Realized gains and losses resulting from available-for-sale securities are included in other income, net, in the unaudited condensed consolidated statements of income. There were no significant reclassifications of realized gains and losses on available-for-sale securities to the unaudited condensed consolidated statements of income for the three and six months ended June 30, 2017 and June 30, 2016. Gains and losses on the sale of available-for-sale securities are determined using the specific identification method. There was $469 thousand of net unrealized loss and $145 thousand of net unrealized loss on available-for-sale securities as of June 30, 2017 and December 31, 2016, respectively. The amortized cost, net unrealized gain and fair value of our funds held for customers and corporate investments in marketable available-for-sale securities as of June 30, 2017 and December 31, 2016 are shown below (in thousands):
_________________ (1) Included within available-for-sale securities as of June 30, 2017 and December 31, 2016 are corporate investments with fair values of $12.9 million and $24.1 million, respectively. Included within available-for-sale securities as of June 30, 2017 and December 31, 2016 are funds held for customers with fair values of $208.9 million and $148.8 million, respectively. All available-for-sale securities were included in Level 2 of the fair value hierarchy. The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of June 30, 2017 are as follows (in thousands):
The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of December 31, 2016 are as follows (in thousands):
The amortized cost and fair value of the marketable available-for-sale securities, by contractual maturity, as of June 30, 2017, are shown below (in thousands):
The amortized cost and fair value of the marketable available-for-sale securities, by contractual maturity, as of December 31, 2016, are shown below (in thousands):
We classify and disclose fair value measurements in one of the following three categories of fair value hierarchy:
A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Our assets that are measured by management at fair value on a recurring basis are generally classified within Level 1 or Level 2 of the fair value hierarchy. We have had assets in the past, and may have assets in the future, classified within Level 1 of the fair value hierarchy. No assets or investments were classified within Level 1 of the fair value hierarchy as of June 30, 2017 or as of December 31, 2016. We did not have any transfers into and out of Level 1 or Level 2 during the three and six months ended June 30, 2017 or the twelve months ended December 31, 2016. No assets or investments were classified as Level 3 as of June 30, 2017 or as of December 31, 2016. The types of instruments valued by management, based on quoted prices in less active markets, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency, include corporate debentures and bonds, commercial paper, U.S. agency bonds and U.S. Treasury bills and asset-backed securities owned by Ultimate. Such instruments are generally classified within Level 2 of the fair value hierarchy. Ultimate uses consensus pricing, which is based on multiple pricing sources, to value its fixed income investments. The following table sets forth, by level within the fair value hierarchy, financial assets accounted for at fair value as of June 30, 2017 and December 31, 2016 (in thousands):
Assets measured at fair value on a recurring basis were presented in the unaudited condensed consolidated balance sheet as of June 30, 2017 and the audited consolidated balance sheet as of December 31, 2016 as short-term and long-term investments in marketable securities. There were no financial liabilities accounted for at fair value as of June 30, 2017 and December 31, 2016. |
Property and Equipment |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment | Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation and amortization. Property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets, which range from 2 to 15 years. Leasehold improvements and assets under capital leases are amortized over the shorter of the estimated useful life of the asset or the term of the lease, which range from 3 to 15 years. Maintenance and repairs are charged to expense when incurred; betterments are capitalized. Upon the sale or retirement of assets, the cost, accumulated depreciation and amortization are removed from the accounts and any gain or loss is recognized. Property and equipment as of June 30, 2017 and December 31, 2016 consist of the following (in thousands):
We capitalize computer software development costs related to software developed for internal use in accordance with Accounting Standards Codification ("ASC") Topic 350-40, Intangibles Goodwill and Other-Internal Use Software. During the three and six months ended June 30, 2017, we capitalized $13.6 million and $26.2 million , respectively, of computer software development costs related to a development project to be sold in the future as a cloud product only (the "Development Project"). There were $9.0 million and $17.0 million of software development costs related to the Development Project which were capitalized in the three and six months ended June 30, 2016, respectively. For the three and six months ended June 30, 2017 and June 30, 2016, these capitalized costs were primarily direct labor costs. As a component of these direct labor costs we capitalized $1.0 million and $2.0 million of stock-based compensation costs during the three and six months ended June 30, 2017, respectively. During the three and six months ended June 30, 2016, we capitalized $1.0 million and $2.0 million, respectively, of stock-based compensation costs. These capitalized costs are included with internal-use software in property and equipment in the unaudited condensed consolidated balance sheet and purchases of property and equipment in the unaudited condensed consolidated statements of cash flows. Internal-use software is amortized on a straight-line basis over its estimated useful life, commencing after the software development is substantially complete and the software is ready for its intended use. At each balance sheet date, we evaluate the useful lives of these assets and test for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. During the three and six months ended June 30, 2017 there were $1.0 million and $2.0 million, respectively, of amortization associated with certain product modules of the Development Project which were ready for their intended use. During the three and six months ended June 30, 2016 there were $0.3 million and $0.5 million, respectively, of amortization associated with certain product modules of the Development Project which were ready for their intended use. The amortization of capitalized software is included in cost of recurring revenues. |
Prepaid Expenses and Other Current Assets |
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Prepaid Expense and Other Assets, Current [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets as of June 30, 2017 and December 31, 2016 consist of the following (in thousands):
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Goodwill & Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill Goodwill represents the excess of cost over the net tangible and identifiable intangible assets of acquired businesses. Goodwill amounts are not amortized, but rather tested for impairment at least annually. Identifiable intangible assets acquired in business combinations are recorded based upon fair value at the date of acquisition and amortized over their estimated useful lives. The changes in the carrying value of goodwill since December 31, 2016 were as follows (in thousands):
__________________________ (1) Represents the impact of the foreign currency translation of the portion of goodwill that is recorded by our Canadian subsidiary whose functional currency is also its local currency. Such goodwill is translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income (loss). Intangible Assets The following tables present our acquired intangible assets as of the dates specified below (in thousands):
____________________________ (1) Represents the impact of the foreign currency translation of the portion of acquired intangible assets that is recorded by our Canadian subsidiary whose functional currency is also its local currency. Such intangible assets are translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income (loss). Acquired intangible assets are amortized over their estimated useful life, generally three to ten years, in a manner that reflects the pattern in which the economic benefits are consumed. Included in acquired intangible assets as of June 30, 2017 and December 31, 2016, were $0.1 million of assets with indefinite lives. Amortization expense for acquired intangible assets was $0.8 million and $1.6 million for the three and six months ended June 30, 2017, respectively, and $0.3 million and $0.5 million for the three and six months ended June 30, 2016, respectively. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing income available to common stockholders (the numerator) by the weighted average number of common shares outstanding (the denominator) for the period. The computation of diluted earnings per share is similar to basic earnings per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potentially dilutive common shares had been issued. The following table is a reconciliation of the shares of Ultimate's issued and outstanding $0.01 par value common stock ("Common Stock") used in the computation of basic and diluted net income per share for the three and six months ended June 30, 2017 and 2016 (in thousands):
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Foreign Currency |
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Jun. 30, 2017 | |
Foreign Currency [Abstract] | |
Foreign Currency | Foreign Currency The financial statements of Ultimate’s foreign subsidiary, The Ultimate Software Group of Canada, Inc. (“Ultimate Canada”), have been translated into U.S. dollars. The functional currency of Ultimate Canada is the Canadian dollar. Assets and liabilities are translated into U.S. dollars at period-end exchange rates. Income and expenses are translated at the average exchange rate for the reporting period. The resulting translation adjustments, representing unrealized gains or losses, are included in accumulated other comprehensive loss, a component of stockholders’ equity. Realized gains and losses resulting from foreign exchange transactions are included in total operating expenses in the unaudited condensed consolidated statements of income. There were no significant realized gains and losses resulting from foreign exchange transactions to the unaudited condensed consolidated statements of income for the three and six months ended June 30, 2017 and June 30, 2016. For the three and six months ended June 30, 2017, Ultimate had unrealized translation gains of $0.4 million and $0.6 million, respectively. For the three and six months ended June 30, 2016, Ultimate had unrealized translation gains of $0.1 million and $1.5 million, respectively. Included in accumulated other comprehensive loss, as presented in the accompanying unaudited condensed consolidated balance sheets, are cumulative unrealized translation losses of $6.3 million as of June 30, 2017 and $6.9 million as of December 31, 2016. |
Stock-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation | Stock-Based Compensation Summary of Plans Our Amended and Restated 2005 Equity and Incentive Plan (the “Plan”) authorizes the grant of options (“Options”) to non-employee directors, officers and employees of Ultimate to purchase shares of Common Stock. The Plan also authorizes the grant to such persons of restricted and non-restricted shares of Common Stock, stock appreciation rights, stock units and cash performance awards (collectively, together with the Options, the “Awards”). As of June 30, 2017, the aggregate number of shares of Common Stock that were available to be issued under all Awards granted under the Plan was 705,353 shares. The following table sets forth the non-cash stock-based compensation expense resulting from stock-based arrangements that were recorded in our unaudited condensed consolidated statements of income for the periods indicated (in thousands):
Stock-based compensation for the three and six months ended June 30, 2017 was $39.3 million and $73.1 million, respectively, as compared with stock-based compensation of $28.6 million and $55.1 million for the three and six months ended June 30, 2016, respectively. The increases of $10.6 million and $18.1 million in stock-based compensation for the three and six month periods, respectively, included increases of $5.8 million and $10.5 million, respectively, associated with modifications and terminations made to the Company’s change in control plans in March 2015, February 2016, and February 2017. These changes were made to better align management's incentives with long-term value creation for our shareholders. As part of the modifications in connection with the terminations of the change in control plans, time-based restricted stock awards (vesting over three years) were granted to certain senior officers in March 2015, February 2016, and February 2017. Net cash proceeds from the exercise of Options were $3.0 million and $4.5 million for the three and six months ended June 30, 2017, respectively, and $1.5 million and $2.7 million, for the three and six months ended June 30, 2016, respectively. Stock Option, Restricted Stock and Restricted Stock Unit Activity There were no Options granted during the three and six months ended June 30, 2017. The following table summarizes stock option activity (for previously granted Options) for the six months ended June 30, 2017 (in thousands, except per share amounts):
The aggregate intrinsic value of Options in the table above represents total pretax intrinsic value (i.e., the difference between the closing price of Common Stock on the last trading day of the reporting period and the exercise price times the number of shares) that would have been received by the option holders had all option holders exercised their Options on June 30, 2017. The amount of the aggregate intrinsic value changes, based on the fair value of Common Stock. Total intrinsic value of Options exercised was $18.2 million and $28.1 million for the three and six months ended June 30, 2017, respectively, and $10.4 million and $18.3 million for the three and six months ended June 30, 2016, respectively. All previously granted Options were fully vested as of December 31, 2011 and, therefore, no Options vested during the three and six months ended June 30, 2017 and June 30, 2016, respectively. As of June 30, 2017, there were no unrecognized compensation costs related to non-vested Options expected to be recognized as all previously granted Options were fully vested as of December 31, 2011. The following table summarizes restricted stock awards and restricted stock unit awards granted during the three months ended June 30, 2017 and June 30, 2016 (in thousands):
The following table summarizes the activity pertaining to Common Stock previously issued under restricted stock awards and restricted stock unit awards which vested during the three months ended June 30, 2017 and June 30, 2016 (in thousands):
______________________________ (1) During the three months ended June 30, 2017 and June 30, 2016, of the shares released, 5,457 and 3,624 shares, respectively, were retained by Ultimate and not issued, in satisfaction of withholding payroll tax requirements applicable to the payment of such awards. The following table summarizes restricted stock award and restricted stock unit activity for the six months ended June 30, 2017 (in thousands, except per share values):
As of June 30, 2017, $141.0 million of total unrecognized compensation costs related to non-vested restricted stock awards were expected to be recognized over a weighted average period of 1.5 years. As of June 30, 2017, $91.7 million of total unrecognized compensation costs related to non-vested restricted stock unit awards were expected to be recognized over a weighted average period of 2.0 years. |
Summary of Significant Accounting Policies and Recent Accounting Pronouncements (Policies) |
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Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Ultimate's financial instruments, consisting of cash and cash equivalents, investments in marketable securities, funds held for customers and the related obligations, accounts receivable, accounts payable, capital lease obligations and other long-term liabilities, approximated fair value (due to their relatively short maturity) as of June 30, 2017 and December 31, 2016. |
Recently Issued and Adopted Accounting Standards | Recently Issued Accounting Standards In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers ("Topic 606)”. Topic 606 supersedes the revenue requirements in ASU Topic 605, Revenue Recognition ("Topic 605") and requires the recognition of revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services and includes Subtopic 340-40, Other Assets and Deferred Costs - Contracts with Customers, which discusses the deferral if incremental costs of obtaining a contract with a customer, including the period of amortization of such costs. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. Collectively, we refer to Topic 606 and Subtopic 340-40 as the "new standard". Topic 606 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation, among others. We began assessing the new standard in 2016 and have continued our assessment during the first half of 2017 to address the potential impact that Topic 606 could have on our unaudited condensed consolidated financial statements and the required resources to implement the new standard. Our assessment of the impact included an evaluation of the five step process along with the enhancement of disclosures that will be required under the new standard. We have developed our initial plan for implementing the new standard, which includes, but is not limited to, identifying contract populations and "in scope" customer contracts, identifying performance obligations in those customer contracts, and evaluating any impact of variable consideration. Our assessment also includes determining the impact the new standard may have on the revenue reporting processes, including disclosures, ensuring internal controls will operate effectively with the new standard and performing gap analyses on collected data and determining the relative accounting positions where applicable. Included in our assessment of the new standard, we will focus on the potential impact on sales commissions and the term over which they will amortize. We anticipate this standard will not have a material impact on the way we recognize revenues. The new standard will require us to defer incremental commission costs to obtain related subscription contracts over the period of benefit. While we are still assessing the period of benefit, we have concluded that it will be longer than the amortization period under existing GAAP. Under current GAAP, we defer only direct and incremental commission costs to obtain a contract and amortize those costs over the term of the related subscription contract, which is generally 2-3 years. We are still evaluating the overall effect the standard will have on the unaudited condensed consolidated financial statements and related disclosures. Topic 606 is effective for Ultimate on January 1, 2018 using either of two transition methods including several practical expedients: (1) full retrospective method, in which the new standard would be applied to each prior reporting period presented or (2) the modified retrospective method, in which the cumulative effect of initially applying the new standard would be recognized at the date of initial application and providing certain additional disclosures as defined per the new standard. Ultimate has not yet selected a transition method. In February 2016, the FASB issued ASU 2016-02, "Leases" ("ASU 2016-02"), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The new standard is effective for Ultimate on January 1, 2019 and early adoption is permitted. The standard requires lessees and lessors to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. We are evaluating the effect that ASU 2016-02 will have on our unaudited condensed consolidated financial statements and related disclosures. We have not yet determined the effect the standard will have on our ongoing financial reporting. Recently Adopted Accounting Standards In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): "Balance Sheet Classification of Deferred Taxes" ("ASU 2015-17”). ASU 2015-17 requires entities to offset all deferred tax assets and liabilities (and valuation allowances) for each tax-paying jurisdiction within each tax-paying component and present the net deferred tax as a single noncurrent amount in a classified balance sheet. Effective January 1, 2017 the Company adopted ASU 2015-17. Subsequent to adoption, all deferred tax assets and deferred tax liabilities are presented as noncurrent on the balance sheet. The changes have been applied prospectively as permitted by the ASU and prior years have not been restated. The adoption of this ASU does not have a material effect on the Company's results of operations, financial condition or liquidity. |
Investments in Marketable Securities and Fair Value of Financial Instruments (Tables) |
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Investments in Marketable Securities and Fair Value of Financial Instruments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortized cost, net unrealized gain and fair value of investments in marketable available-for-sale securities | The amortized cost, net unrealized gain and fair value of our funds held for customers and corporate investments in marketable available-for-sale securities as of June 30, 2017 and December 31, 2016 are shown below (in thousands):
_________________ (1) Included within available-for-sale securities as of June 30, 2017 and December 31, 2016 are corporate investments with fair values of $12.9 million and $24.1 million, respectively. Included within available-for-sale securities as of June 30, 2017 and December 31, 2016 are funds held for customers with fair values of $208.9 million and $148.8 million, respectively. All available-for-sale securities were included in Level 2 of the fair value hierarchy. |
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Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Table Text Block] | The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of June 30, 2017 are as follows (in thousands):
The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of December 31, 2016 are as follows (in thousands):
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Amortized costs and fair value of marketable available-for-sale securities by contractual maturity | The amortized cost and fair value of the marketable available-for-sale securities, by contractual maturity, as of June 30, 2017, are shown below (in thousands):
The amortized cost and fair value of the marketable available-for-sale securities, by contractual maturity, as of December 31, 2016, are shown below (in thousands):
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Fair value of financial assets and liabilities, by level within the fair value hierarchy | The following table sets forth, by level within the fair value hierarchy, financial assets accounted for at fair value as of June 30, 2017 and December 31, 2016 (in thousands):
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Property and Equipment (Tables) |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and equipment | Property and equipment as of June 30, 2017 and December 31, 2016 consist of the following (in thousands):
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Prepaid Expenses and Other Current Assets (Tables) |
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Prepaid expenses and other current assets | Prepaid expenses and other current assets as of June 30, 2017 and December 31, 2016 consist of the following (in thousands):
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Goodwill & Intangible Assets (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Goodwill | The changes in the carrying value of goodwill since December 31, 2016 were as follows (in thousands):
__________________________ (1) Represents the impact of the foreign currency translation of the portion of goodwill that is recorded by our Canadian subsidiary whose functional currency is also its local currency. Such goodwill is translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income (loss). |
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Schedule of Finite-Lived Intangible Assets | The following tables present our acquired intangible assets as of the dates specified below (in thousands):
____________________________ (1) Represents the impact of the foreign currency translation of the portion of acquired intangible assets that is recorded by our Canadian subsidiary whose functional currency is also its local currency. Such intangible assets are translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income (loss). |
Earnings Per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of shares used in the computation of basic and diluted net income per share | The following table is a reconciliation of the shares of Ultimate's issued and outstanding $0.01 par value common stock ("Common Stock") used in the computation of basic and diluted net income per share for the three and six months ended June 30, 2017 and 2016 (in thousands):
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Stock-Based Compensation (Tables) |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-cash stock-based compensation expense | The following table sets forth the non-cash stock-based compensation expense resulting from stock-based arrangements that were recorded in our unaudited condensed consolidated statements of income for the periods indicated (in thousands):
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Summary of stock option activity | The following table summarizes stock option activity (for previously granted Options) for the six months ended June 30, 2017 (in thousands, except per share amounts):
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Schedule of restricted stock awards and restricted stock unit awards granted | The following table summarizes restricted stock awards and restricted stock unit awards granted during the three months ended June 30, 2017 and June 30, 2016 (in thousands):
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Schedule of activity pertaining to restricted awards vested | The following table summarizes the activity pertaining to Common Stock previously issued under restricted stock awards and restricted stock unit awards which vested during the three months ended June 30, 2017 and June 30, 2016 (in thousands):
______________________________ (1) During the three months ended June 30, 2017 and June 30, 2016, of the shares released, 5,457 and 3,624 shares, respectively, were retained by Ultimate and not issued, in satisfaction of withholding payroll tax requirements applicable to the payment of such awards. |
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Summary of restricted stock award and restricted stock unit activity | The following table summarizes restricted stock award and restricted stock unit activity for the six months ended June 30, 2017 (in thousands, except per share values):
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Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Dec. 31, 2016 |
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Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid commissions | $ 35,311 | $ 29,842 |
Other Prepaid Expense | 19,899 | 16,753 |
Other Assets | 17,248 | 15,306 |
Total prepaid expenses and other current assets | $ 72,458 | $ 61,901 |
Goodwill & Intangible Assets Goodwill and Intangible Assets (Goodwill) (Details) $ in Thousands |
6 Months Ended |
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Jun. 30, 2017
USD ($)
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Goodwill [Roll Forward] | |
Goodwill, December 31, 2016 | $ 35,322 |
Translation adjustment | 241 |
Goodwill, June 30, 2017 | $ 35,563 |
Earnings Per Share (Details) - $ / shares shares in Thousands |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
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Earnings Per Share [Abstract] | ||||
Common Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 |
Basic weighted average shares outstanding (in shares) | 29,751 | 28,895 | 29,645 | 28,860 |
Effect of dilutive equity instruments (in shares) | 872 | 1,345 | 994 | 1,380 |
Diluted weighted average shares outstanding (in shares) | 30,623 | 30,240 | 30,639 | 30,240 |
Options to purchase shares of Common Stock and other stock-based awards outstanding which are not included in the calculation of diluted income per share because their impact is anti-dilutive (in shares) | 1 | 0 | 5 | 3 |
Foreign Currency (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
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Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
Dec. 31, 2016 |
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Foreign Currency [Abstract] | |||||
Cumulative unrealized translation losses | $ 0.4 | $ 0.1 | $ 0.6 | $ 1.5 | |
Unrealized translation loss included in accumulated other comprehensive income | $ (6.3) | $ (6.3) | $ (6.9) |
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