Canton of Vaud, Switzerland (State or other jurisdiction of incorporation or organization) | None (I.R.S. Employer Identification No.) |
Large accelerated filer ý | Accelerated filer o | Non-accelerated filer o (Do not check if a smaller reporting company) | Smaller reporting company o | Emerging Growth Company o |
Page | ||
Part I | FINANCIAL INFORMATION | |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net sales | $ | 691,146 | $ | 632,470 | $ | 1,299,626 | $ | 1,162,416 | ||||||||
Cost of goods sold | 432,063 | 402,722 | 814,234 | 737,496 | ||||||||||||
Amortization of intangible assets and purchase accounting effect on inventory | 2,966 | 2,011 | 5,338 | 3,515 | ||||||||||||
Gross profit | 256,117 | 227,737 | 480,054 | 421,405 | ||||||||||||
Operating expenses: | ||||||||||||||||
Marketing and selling | 121,801 | 107,386 | 236,385 | 209,764 | ||||||||||||
Research and development | 39,542 | 36,647 | 78,529 | 71,746 | ||||||||||||
General and administrative | 25,206 | 25,266 | 50,679 | 50,675 | ||||||||||||
Amortization of intangible assets and acquisition-related costs | 4,317 | 2,491 | 6,838 | 3,881 | ||||||||||||
Change in fair value of contingent consideration for business acquisition | — | (2,930 | ) | — | (4,908 | ) | ||||||||||
Restructuring charges (credits), net | 119 | (61 | ) | 10,040 | (116 | ) | ||||||||||
Total operating expenses | 190,985 | 168,799 | 382,471 | 331,042 | ||||||||||||
Operating income | 65,132 | 58,938 | 97,583 | 90,363 | ||||||||||||
Interest income | 1,858 | 1,048 | 4,227 | 2,223 | ||||||||||||
Other income (expense), net | 3,389 | 459 | 1,818 | (570 | ) | |||||||||||
Income before income taxes | 70,379 | 60,445 | 103,628 | 92,016 | ||||||||||||
Provision for (benefit from) income taxes | 6,203 | 4,087 | 986 | (1,349 | ) | |||||||||||
Net income | $ | 64,176 | $ | 56,358 | $ | 102,642 | $ | 93,365 | ||||||||
Net income per share: | ||||||||||||||||
Basic | $ | 0.39 | $ | 0.34 | $ | 0.62 | $ | 0.57 | ||||||||
Diluted | $ | 0.38 | $ | 0.33 | $ | 0.61 | $ | 0.55 | ||||||||
Weighted average shares used to compute net income per share: | ||||||||||||||||
Basic | 165,630 | 164,120 | 165,474 | 163,765 | ||||||||||||
Diluted | 169,234 | 169,078 | 168,996 | 168,710 | ||||||||||||
Cash dividend per share | $ | 0.69 | $ | 0.63 | $ | 0.69 | $ | 0.63 |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net income | $ | 64,176 | $ | 56,358 | $ | 102,642 | $ | 93,365 | ||||||||
Other comprehensive income (loss): | ||||||||||||||||
Currency translation gain (loss), net of taxes | (2,863 | ) | 2,185 | (7,826 | ) | 3,641 | ||||||||||
Defined benefit pension plans: | ||||||||||||||||
Net gain and prior service costs, net of taxes | 192 | 532 | 98 | 380 | ||||||||||||
Amortization included in other income (expense), net | (69 | ) | 52 | (139 | ) | 102 | ||||||||||
Hedging gain (loss): | ||||||||||||||||
Deferred hedging gain (loss), net of taxes | 298 | (2,140 | ) | 485 | (5,349 | ) | ||||||||||
Reclassification of hedging loss included in cost of goods sold | 218 | 2,596 | 3,069 | 3,129 | ||||||||||||
Other comprehensive income (loss) | (2,224 | ) | 3,225 | (4,313 | ) | 1,903 | ||||||||||
Total comprehensive income | $ | 61,952 | $ | 59,583 | $ | 98,329 | $ | 95,268 |
September 30, 2018 | March 31, 2018 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 424,950 | $ | 641,947 | ||||
Accounts receivable, net | 459,689 | 214,885 | ||||||
Inventories | 358,774 | 259,906 | ||||||
Other current assets | 70,412 | 56,362 | ||||||
Total current assets | 1,313,825 | 1,173,100 | ||||||
Non-current assets: | ||||||||
Property, plant and equipment, net | 83,731 | 86,304 | ||||||
Goodwill | 346,548 | 275,451 | ||||||
Other intangible assets, net | 130,538 | 87,547 | ||||||
Other assets | 131,565 | 120,755 | ||||||
Total assets | $ | 2,006,207 | $ | 1,743,157 | ||||
Liabilities and Shareholders’ Equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 440,564 | $ | 293,988 | ||||
Accrued and other current liabilities | 434,615 | 281,732 | ||||||
Total current liabilities | 875,179 | 575,720 | ||||||
Non-current liabilities: | ||||||||
Income taxes payable | 34,456 | 34,956 | ||||||
Other non-current liabilities | 84,408 | 81,924 | ||||||
Total liabilities | 994,043 | 692,600 | ||||||
Commitments and contingencies (Note 11) | ||||||||
Shareholders’ equity: | ||||||||
Registered shares, CHF 0.25 par value: | 30,148 | 30,148 | ||||||
Issued shares — 173,106 at September 30 and March 31, 2018 | ||||||||
Additional shares that may be issued out of conditional capitals — 50,000 at September 30 and March 31, 2018 | ||||||||
Additional shares that may be issued out of authorized capital — 34,621 at September 30, 2018 and none at March 31, 2018 | ||||||||
Additional paid-in capital | 33,160 | 47,234 | ||||||
Shares in treasury, at cost — 7,384 at September 30, 2018 and 8,527 at March 31, 2018 | (163,481 | ) | (165,686 | ) | ||||
Retained earnings | 1,210,105 | 1,232,316 | ||||||
Accumulated other comprehensive loss | (97,768 | ) | (93,455 | ) | ||||
Total shareholders’ equity | 1,012,164 | 1,050,557 | ||||||
Total liabilities and shareholders’ equity | $ | 2,006,207 | $ | 1,743,157 |
Six Months Ended September 30, | ||||||||
2018 | 2017 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 102,642 | $ | 93,365 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation | 21,895 | 19,368 | ||||||
Amortization of intangible assets | 10,341 | 6,238 | ||||||
Gain on investments in privately held companies | (382 | ) | (436 | ) | ||||
Share-based compensation expense | 25,308 | 21,683 | ||||||
Deferred income taxes | (9,815 | ) | (11,933 | ) | ||||
Change in fair value of contingent consideration for business acquisition | — | (4,908 | ) | |||||
Other | 75 | 12 | ||||||
Changes in assets and liabilities, net of acquisitions: | ||||||||
Accounts receivable, net | (133,475 | ) | (91,718 | ) | ||||
Inventories | (84,401 | ) | (58,078 | ) | ||||
Other assets | (11,056 | ) | (8,490 | ) | ||||
Accounts payable | 138,186 | 110,136 | ||||||
Accrued and other liabilities | 37,902 | (7,739 | ) | |||||
Net cash provided by operating activities | 97,220 | 67,500 | ||||||
Cash flows from investing activities: | ||||||||
Purchases of property, plant and equipment | (18,368 | ) | (17,188 | ) | ||||
Investment in privately held companies | (506 | ) | (520 | ) | ||||
Acquisitions, net of cash acquired | (133,908 | ) | (85,000 | ) | ||||
Proceeds from return of investment in privately held companies | — | 237 | ||||||
Purchases of short-term investments | (1,505 | ) | (6,789 | ) | ||||
Purchases of trading investments | (3,722 | ) | (999 | ) | ||||
Proceeds from sales of trading investments | 4,194 | 1,057 | ||||||
Net cash used in investing activities | (153,815 | ) | (109,202 | ) | ||||
Cash flows from financing activities: | ||||||||
Payment of cash dividends | (113,971 | ) | (104,248 | ) | ||||
Purchases of registered shares | (19,901 | ) | (10,682 | ) | ||||
Proceeds from exercises of stock options | 10,007 | 30,000 | ||||||
Tax withholdings related to net share settlements of restricted stock units | (27,380 | ) | (23,706 | ) | ||||
Net cash used in financing activities | (151,245 | ) | (108,636 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | (9,157 | ) | 1,653 | |||||
Net decrease in cash and cash equivalents | (216,997 | ) | (148,685 | ) | ||||
Cash and cash equivalents, beginning of the period | 641,947 | 547,533 | ||||||
Cash and cash equivalents, end of the period | $ | 424,950 | $ | 398,848 | ||||
Supplementary Cash Flow Disclosures: | ||||||||
Non-cash investing activities: | ||||||||
Property, plant and equipment purchased during the period and included in period end liability accounts | $ | 4,267 | $ | 6,219 |
Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Total Shareholders’ Equity | |||||||||||||||||||||||||||
Registered Shares | Treasury Shares | Retained Earnings | |||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||
March 31, 2017 | 173,106 | $ | 30,148 | $ | 26,596 | 10,727 | $ | (174,037 | ) | $ | 1,074,110 | $ | (100,706 | ) | $ | 856,111 | |||||||||||||
Cumulative effect of adoption of new accounting standard | — | — | 3,293 | — | — | 53,912 | — | 57,205 | |||||||||||||||||||||
Total comprehensive income | — | — | — | — | — | 93,365 | 1,903 | 95,268 | |||||||||||||||||||||
Purchases of registered shares | — | — | — | 307 | (10,682 | ) | — | — | (10,682 | ) | |||||||||||||||||||
Sales of shares upon exercise of stock options | — | — | 15,628 | (1,084 | ) | 14,372 | — | — | 30,000 | ||||||||||||||||||||
Issuance of shares upon vesting of restricted stock units | — | — | (37,464 | ) | (1,205 | ) | 13,758 | — | — | (23,706 | ) | ||||||||||||||||||
Share-based compensation | — | — | 21,887 | — | — | — | — | 21,887 | |||||||||||||||||||||
Cash dividends | — | — | — | — | — | (104,248 | ) | — | (104,248 | ) | |||||||||||||||||||
September 30, 2017 | 173,106 | $ | 30,148 | $ | 29,940 | 8,745 | $ | (156,589 | ) | $ | 1,117,139 | $ | (98,803 | ) | $ | 921,835 |
Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Total Shareholders’ Equity | |||||||||||||||||||||||||||
Registered Shares | Treasury Shares | Retained Earnings | |||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||
March 31, 2018 | 173,106 | $ | 30,148 | $ | 47,234 | 8,527 | $ | (165,686 | ) | $ | 1,232,316 | $ | (93,455 | ) | $ | 1,050,557 | |||||||||||||
Cumulative effect of adoption of new accounting standard (Note 1) | — | — | — | — | — | (10,882 | ) | — | (10,882 | ) | |||||||||||||||||||
Total comprehensive income | — | — | — | — | — | 102,642 | (4,313 | ) | 98,329 | ||||||||||||||||||||
Purchases of registered shares | — | — | — | 474 | (19,901 | ) | (19,901 | ) | |||||||||||||||||||||
Sales of shares upon exercise of stock options | — | — | 5,951 | (311 | ) | 4,056 | — | — | 10,007 | ||||||||||||||||||||
Issuance of shares upon vesting of restricted stock units | — | — | (45,430 | ) | (1,306 | ) | 18,050 | — | — | (27,380 | ) | ||||||||||||||||||
Share-based compensation | — | — | 25,405 | — | — | — | — | 25,405 | |||||||||||||||||||||
Cash dividends | — | — | — | — | — | (113,971 | ) | — | (113,971 | ) | |||||||||||||||||||
September 30, 2018 | 173,106 | $ | 30,148 | $ | 33,160 | 7,384 | $ | (163,481 | ) | $ | 1,210,105 | $ | (97,768 | ) | $ | 1,012,164 |
As of March 31, 2018 | Effect of Adoption of Topic 606 | As of April 1, 2018 | ||||||||||
Accounts receivable, net | $ | 214,885 | $ | 105,768 | $ | 320,653 | ||||||
Other current assets | 56,362 | 6,195 | 62,557 | |||||||||
Accrued and other current liabilities | 281,732 | 122,845 | 404,577 | |||||||||
Retained earnings | 1,232,316 | (10,882 | ) | 1,221,434 |
• | Under Topic 605, accruals for certain Customer Programs were recognized as a reduction of revenue at the later of when the related revenue is recognized or when the program is offered to the customer. Under Topic 606, these programs qualify as variable consideration and are recorded as a reduction of the |
• | Under Topic 606, variable consideration must be estimated at the outset of the arrangement, subject to the constraint guidance to ensure that a significant revenue reversal will not occur. As a result, upon adoption of Topic 606, estimated breakage for accruals of certain Customer Programs is recognized sooner as compared to Topic 605. |
• | Under Topic 605, the gross amount of accrued revenue reserves for sales returns of $31.4 million, net of expected returned inventory of $11.4 million was included within accounts receivable, net as of March 31, 2018. Expected scrap cost of $5.2 million for such expected returned inventory was included in accrued and other current liabilities as of March 31, 2018. Subsequent to the adoption of Topic 606, such balances are presented on a gross basis as accrued revenue reserve from returns of $31.4 million included in accrued and other current liabilities and as return assets of $6.2 million included in other current assets. |
• | Under Topic 605, revenue reserves for certain Customer Programs totaling $76.7 million, which were estimated using portfolio approach based on aggregated customer level, were included within accounts receivable, net as of March 31, 2018. Subsequent to the adoption of Topic 606, such balances are presented as accrued customer marketing, pricing and incentive programs included in accrued and other current liabilities. |
Three Months Ended September 30,2018 | Six Months Ended September 30, 2018 | ||||||||||||||||||
As Reported Under ASC 606 | If Reported Under ASC 605 | Effect of Change | As Reported Under ASC 606 | If Reported Under ASC 605 | Effect of Change | ||||||||||||||
Net sales | $ | 691,146 | $ | 696,090 | $ | (4,944 | ) | $ | 1,299,626 | $ | 1,304,704 | $ | (5,078 | ) |
As of September 30,2018 | |||||||||
As Reported Under ASC 606 | Balance Under ASC 605 | Effect of Change | |||||||
Accounts receivable, net | 459,689 | 327,131 | 132,558 | ||||||
Other current assets | 70,412 | 61,092 | 9,320 | ||||||
Accrued and other current liabilities | 434,615 | 276,777 | 157,838 | ||||||
Retained earnings | 1,210,105 | 1,226,065 | (15,960 | ) |
Estimated Fair Value | ||||
Cash and cash equivalents | $ | 1,110 | ||
Accounts receivable | 10,979 | |||
Inventories | 20,206 | |||
Other current assets | 997 | |||
Property, plant and equipment | 1,103 | |||
Intangible assets | 53,267 | |||
Total identifiable assets acquired | $ | 87,662 | ||
Accounts payable | (10,322 | ) | ||
Accrued liabilities | (13,316 | ) | ||
Other long-term liabilities | (271 | ) | ||
Net identifiable assets acquired | $ | 63,753 | ||
Goodwill | 71,116 | |||
Net assets acquired | $ | 134,869 |
Preliminary Fair Value | Estimated Useful Life (years) | ||||
Developed technology | $ | 17,967 | 5.0 | ||
Customer relationships | 22,800 | 10.0 | |||
Trade name | 12,500 | 7.0 | |||
Total intangible assets acquired | $ | 53,267 | 7.6 |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net income | $ | 64,176 | $ | 56,358 | $ | 102,642 | $ | 93,365 | ||||||||
Shares used in net income per share computation: | ||||||||||||||||
Weighted average shares outstanding - basic | 165,630 | 164,120 | 165,474 | 163,765 | ||||||||||||
Effect of potentially dilutive equivalent shares | 3,604 | 4,958 | 3,522 | 4,945 | ||||||||||||
Weighted average shares outstanding - diluted | 169,234 | 169,078 | 168,996 | 168,710 | ||||||||||||
Net income per share: | ||||||||||||||||
Basic | $ | 0.39 | $ | 0.34 | $ | 0.62 | $ | 0.57 | ||||||||
Diluted | $ | 0.38 | $ | 0.33 | $ | 0.61 | $ | 0.55 |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Cost of goods sold | $ | 791 | $ | 1,091 | $ | 1,921 | $ | 1,802 | ||||||||
Marketing and selling | 4,864 | 4,343 | 10,650 | 8,724 | ||||||||||||
Research and development | 1,935 | 1,633 | 3,484 | 3,176 | ||||||||||||
General and administrative | 4,459 | 3,911 | 9,253 | 7,981 | ||||||||||||
Total share-based compensation expense | 12,049 | 10,978 | 25,308 | 21,683 | ||||||||||||
Income tax benefit | (2,650 | ) | (3,677 | ) | (12,179 | ) | (14,959 | ) | ||||||||
Total share-based compensation expense, net of income tax | $ | 9,399 | $ | 7,301 | $ | 13,129 | $ | 6,724 |
September 30, 2018 | March 31, 2018 | |||||||
Accounts receivable, net: | ||||||||
Accounts receivable | $ | 639,479 | $ | 482,872 | ||||
Allowance for doubtful accounts | (645 | ) | (122 | ) | ||||
Allowance for sales returns (1) | (5,165 | ) | (25,515 | ) | ||||
Allowance for cooperative marketing arrangements (1) | (33,879 | ) | (30,389 | ) | ||||
Allowance for customer incentive programs (1) | (55,972 | ) | (70,592 | ) | ||||
Allowance for pricing programs (1) | (84,129 | ) | (141,369 | ) | ||||
$ | 459,689 | $ | 214,885 | |||||
Inventories: | ||||||||
Raw materials | $ | 31,756 | $ | 33,603 | ||||
Finished goods | 327,018 | 226,303 | ||||||
$ | 358,774 | $ | 259,906 | |||||
Other current assets: | ||||||||
Value-added tax receivables | $ | 34,597 | $ | 29,477 | ||||
Prepaid expenses and other assets (1) | 35,815 | 26,885 | ||||||
$ | 70,412 | $ | 56,362 | |||||
Property, plant and equipment, net: | ||||||||
Property, plant and equipment at cost | $ | 359,335 | $ | 346,588 | ||||
Less: accumulated depreciation and amortization | (275,604 | ) | (260,284 | ) | ||||
$ | 83,731 | $ | 86,304 | |||||
Other assets: | ||||||||
Deferred tax assets | $ | 92,833 | $ | 84,651 | ||||
Trading investments for deferred compensation plan | 20,645 | 17,748 | ||||||
Investments in privately held companies | 13,283 | 12,448 | ||||||
Other assets | 4,804 | 5,908 | ||||||
$ | 131,565 | $ | 120,755 |
September 30, 2018 | March 31, 2018 | |||||||
Accrued and other current liabilities: | ||||||||
Accrued personnel expenses | $ | 80,554 | $ | 82,330 | ||||
Accrued revenue reserve from returns (1) | 38,359 | — | ||||||
Accrued customer marketing, pricing and incentive programs (1) | 173,992 | 71,962 | ||||||
Warranty accrual | 18,470 | 16,279 | ||||||
Employee benefit plan obligation | 2,243 | 1,763 | ||||||
Income taxes payable | 5,741 | 4,354 | ||||||
Other current liabilities | 115,256 | 105,044 | ||||||
$ | 434,615 | $ | 281,732 | |||||
Other non-current liabilities: | ||||||||
Warranty accrual | $ | 13,284 | $ | 11,294 | ||||
Obligation for deferred compensation plan | 20,645 | 17,748 | ||||||
Employee benefit plan obligation | 40,857 | 42,434 | ||||||
Deferred tax liability | 1,980 | 1,980 | ||||||
Other non-current liabilities | 7,642 | 8,468 | ||||||
$ | 84,408 | $ | 81,924 |
September 30, 2018 | March 31, 2018 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Cash equivalents | $ | 304,627 | $ | — | $ | — | $ | 492,535 | $ | — | $ | — | ||||||||||||
Trading investments for deferred compensation plan included in other assets: | ||||||||||||||||||||||||
Money market funds | $ | 4,252 | $ | — | $ | — | $ | 2,881 | $ | — | $ | — | ||||||||||||
Mutual funds | 16,393 | — | — | 14,867 | — | — | ||||||||||||||||||
Total of trading investments for deferred compensation plan | $ | 20,645 | $ | — | $ | — | $ | 17,748 | $ | — | $ | — | ||||||||||||
Currency exchange derivative assets included in other current assets | $ | — | $ | 244 | $ | — | $ | — | $ | — | $ | — | ||||||||||||
Liabilities: | ||||||||||||||||||||||||
Currency exchange derivative liabilities included in accrued and other current liabilities | $ | — | $ | 50 | $ | — | $ | — | $ | 34 | $ | — |
Three Months Ended September 30, | ||||||||||||||||
Amount of Gain (Loss) Deferred as a Component of Accumulated Other Comprehensive Loss | Amount of Loss (Gain) Reclassified from Accumulated Other Comprehensive Loss to Costs of Goods Sold | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Cash flow hedges | $ | 298 | $ | (2,140 | ) | $ | 218 | $ | 2,596 |
Six Months Ended September 30, | ||||||||||||||||
Amount of Gain (Loss) Deferred as a Component of Accumulated Other Comprehensive Loss | Amount of Loss (Gain) Reclassified from Accumulated Other Comprehensive Loss to Costs of Goods Sold | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Cash flow hedges | $ | 485 | $ | (5,349 | ) | $ | 3,069 | $ | 3,129 |
As of March 31, 2018 | $ | 275,451 | ||
Acquisition (Note 2) | 71,116 | |||
Currency translation | (19 | ) | ||
As of September 30, 2018 | $ | 346,548 |
September 30, 2018 | March 31, 2018 | |||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||
Trademark and trade names | $ | 36,370 | $ | (11,199 | ) | $ | 25,171 | $ | 23,870 | $ | (9,482 | ) | $ | 14,388 | ||||||||||
Developed technology | 95,207 | (55,722 | ) | 39,485 | 77,175 | (50,755 | ) | 26,420 | ||||||||||||||||
Customer contracts/relationships | 82,310 | (16,428 | ) | 65,882 | 59,510 | (12,771 | ) | 46,739 | ||||||||||||||||
Total | $ | 213,887 | $ | (83,349 | ) | $ | 130,538 | $ | 160,555 | $ | (73,008 | ) | $ | 87,547 |
Three Months Ended September 30, | Six Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Beginning of the period | $ | 28,853 | $ | 22,056 | $ | 27,573 | $ | 21,911 | |||||||
Assumed from business acquisition | 351 | 1,230 | 351 | 1,230 | |||||||||||
Provision | 11,020 | 5,414 | 19,320 | 9,715 | |||||||||||
Settlements | (8,330 | ) | (4,611 | ) | (14,882 | ) | (9,179 | ) | |||||||
Currency translation | (140 | ) | 260 | (608 | ) | 672 | |||||||||
End of the period | $ | 31,754 | $ | 24,349 | $ | 31,754 | $ | 24,349 |
Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||
Cumulative Translation Adjustment (1) | Defined Benefit Plan (1) | Deferred Hedging Losses (1) | Total | |||||||||||||
March 31, 2018 | $ | (83,848 | ) | $ | (6,398 | ) | $ | (3,209 | ) | $ | (93,455 | ) | ||||
Other comprehensive income (loss) | (7,826 | ) | (41 | ) | 3,554 | (4,313 | ) | |||||||||
September 30, 2018 | $ | (91,674 | ) | $ | (6,439 | ) | $ | 345 | $ | (97,768 | ) |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Pointing Devices | $ | 128,337 | $ | 123,643 | $ | 256,127 | $ | 245,717 | ||||||||
Keyboards & Combos | 131,872 | 119,200 | 260,094 | 235,313 | ||||||||||||
PC Webcams | 28,221 | 27,466 | 57,895 | 53,091 | ||||||||||||
Tablet & Other Accessories | 36,710 | 30,784 | 69,146 | 54,002 | ||||||||||||
Video Collaboration | 57,176 | 46,139 | 115,968 | 81,756 | ||||||||||||
Mobile Speakers | 77,100 | 90,548 | 111,427 | 153,466 | ||||||||||||
Audio & Wearables | 61,560 | 62,445 | 113,714 | 112,647 | ||||||||||||
Gaming | 160,792 | 113,722 | 296,818 | 191,430 | ||||||||||||
Smart Home | 9,241 | 18,323 | 18,252 | 34,789 | ||||||||||||
Other (1) | 137 | 200 | 185 | 205 | ||||||||||||
Total net sales | $ | 691,146 | $ | 632,470 | $ | 1,299,626 | $ | 1,162,416 |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Americas | $ | 283,714 | $ | 261,993 | $ | 560,642 | $ | 507,393 | ||||||||
EMEA | 218,300 | 218,323 | 378,932 | 368,914 | ||||||||||||
Asia Pacific | 189,132 | 152,154 | 360,052 | 286,109 | ||||||||||||
Total net sales | $ | 691,146 | $ | 632,470 | $ | 1,299,626 | $ | 1,162,416 |
September 30, 2018 | March 31, 2018 | |||||||
Americas | $ | 33,508 | $ | 35,404 | ||||
EMEA | 4,327 | 4,690 | ||||||
Asia Pacific | 45,896 | 46,210 | ||||||
Total property, plant and equipment, net | $ | 83,731 | $ | 86,304 |
Termination Benefits | ||||
Accrual balance at March 31, 2018 | $ | — | ||
Charges | 9,921 | |||
Cash payments | (2,014 | ) | ||
Accrual balance at June 30, 2018 | 7,907 | |||
Charges | 119 | |||
Cash payments | (1,945 | ) | ||
Accrual balance at September 30, 2018 | $ | 6,081 |
Sales Growth Rate | Constant Dollar Sales Growth Rate | ||||||||||
Three Months Ended September 30, 2018 | Six Months Ended September 30, 2018 | Three Months Ended September 30, 2018 | Six Months Ended September 30, 2018 | ||||||||
Americas | 8 | % | 10 | % | 9 | % | 11 | % | |||
EMEA | — | % | 3 | % | 1 | % | 1 | % | |||
Asia Pacific | 24 | % | 26 | % | 26 | % | 25 | % |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||||||
2018 | 2017 | Change | 2018 | 2017 | Change | |||||||||||||||
Pointing Devices | $ | 128,337 | $ | 123,643 | 4% | $ | 256,127 | $ | 245,717 | 4% | ||||||||||
Keyboards & Combos | 131,872 | 119,200 | 11 | 260,094 | 235,313 | 11 | ||||||||||||||
PC Webcams | 28,221 | 27,466 | 3 | 57,895 | 53,091 | 9 | ||||||||||||||
Tablet & Other Accessories | 36,710 | 30,784 | 19 | 69,146 | 54,002 | 28 | ||||||||||||||
Video Collaboration | 57,176 | 46,139 | 24 | 115,968 | 81,756 | 42 | ||||||||||||||
Mobile Speakers | 77,100 | 90,548 | (15) | 111,427 | 153,466 | (27) | ||||||||||||||
Audio & Wearables | 61,560 | 62,445 | (1) | 113,714 | 112,647 | 1 | ||||||||||||||
Gaming | 160,792 | 113,722 | 41 | 296,818 | 191,430 | 55 | ||||||||||||||
Smart Home | 9,241 | 18,323 | (50) | 18,252 | 34,789 | (48) | ||||||||||||||
Other (1) | 137 | 200 | (32) | 185 | 205 | (10) | ||||||||||||||
Total net sales | $ | 691,146 | $ | 632,470 | 9 | $ | 1,299,626 | $ | 1,162,416 | 12 |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||||||||
2018 | 2017 | Change | 2018 | 2017 | Change | |||||||||||||||||
Net sales | $ | 691,146 | $ | 632,470 | 9 | % | $ | 1,299,626 | $ | 1,162,416 | 12 | % | ||||||||||
Gross profit | $ | 256,117 | $ | 227,737 | 12 | $ | 480,054 | $ | 421,405 | 14 | ||||||||||||
Gross margin | 37.1 | % | 36.0 | % | 36.9 | % | 36.3 | % |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Marketing and selling | $ | 121,801 | $ | 107,386 | $ | 236,385 | $ | 209,764 | ||||||||
% of net sales | 17.6 | % | 17.0 | % | 18.2 | % | 18.0 | % | ||||||||
Research and development | 39,542 | 36,647 | 78,529 | 71,746 | ||||||||||||
% of net sales | 5.7 | % | 5.8 | % | 6.0 | % | 6.2 | % | ||||||||
General and administrative | 25,206 | 25,266 | 50,679 | 50,675 | ||||||||||||
% of net sales | 3.6 | % | 4.0 | % | 3.9 | % | 4.4 | % | ||||||||
Amortization of intangible assets and acquisition-related costs | 4,317 | 2,491 | 6,838 | 3,881 | ||||||||||||
% of net sales | 0.6 | % | 0.4 | % | 0.5 | % | 0.3 | % | ||||||||
Change in fair value of contingent consideration for business acquisition | — | (2,930 | ) | — | (4,908 | ) | ||||||||||
% of net sales | — | % | (0.5 | )% | — | % | (0.4 | )% | ||||||||
Restructuring charges (credits), net | 119 | (61 | ) | 10,040 | (116 | ) | ||||||||||
% of net sales | — | % | — | % | 0.8 | % | — | % | ||||||||
Total operating expenses | $ | 190,985 | $ | 168,799 | $ | 382,471 | $ | 331,042 | ||||||||
% of net sales | 27.6 | % | 26.7 | % | 29.4 | % | 28.5 | % |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Amortization of intangible assets | $ | 2,861 | $ | 1,750 | $ | 5,382 | $ | 2,839 | ||||||||
Acquisition-related costs | 1,456 | 741 | 1,456 | 1,042 | ||||||||||||
Total | $ | 4,317 | $ | 2,491 | $ | 6,838 | $ | 3,881 |
Termination Benefits | ||||
Accrual balance at March 31, 2018 | $ | — | ||
Charges | 9,921 | |||
Cash payments | (2,014 | ) | ||
Accrual balance at June 30, 2018 | 7,907 | |||
Charges | 119 | |||
Cash payments | (1,945 | ) | ||
Accrual balance at September 30, 2018 | $ | 6,081 |
Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Provision for (benefit from) income taxes | $ | 6,203 | $ | 4,087 | $ | 986 | $ | (1,349 | ) | |||||||
Effective income tax rate | 8.8 | % | 6.8 | % | 1.0 | % | (1.5 | )% |
Six Months Ended September 30, | ||||||||
2018 | 2017 | |||||||
Net cash provided by operating activities | $ | 97,220 | $ | 67,500 | ||||
Net cash used in investing activities | (153,815 | ) | (109,202 | ) | ||||
Net cash used in financing activities | (151,245 | ) | (108,636 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | (9,157 | ) | 1,653 | |||||
Net decrease in cash and cash equivalents | $ | (216,997 | ) | $ | (148,685 | ) |
As of September 30, | ||||||||
2018 | 2017 | |||||||
Accounts receivable, net | $ | 459,689 | $ | 277,839 | ||||
Accounts payable | $ | 440,564 | $ | 386,963 | ||||
Inventories | $ | 358,774 | $ | 330,422 |
Three Months Ended September 30, | ||||||
2018 | 2017 | |||||
Days sales in accounts receivable (“DSO”) (Days) (1) | 60 | 40 | ||||
Days accounts payable outstanding (“DPO”) (Days) (2) | 91 | 86 | ||||
Inventory turnover (“ITO”) (x)(3) | 4.9 | 4.9 |
Base Currency | Transaction Currency | Net Exposed Long (Short) Currency Position | FX Gain (Loss) From 10% Appreciation of Base Currency | FX Gain (Loss) From 10% Depreciation of Base Currency | ||||||||||
U.S. Dollar | Australian Dollar | $ | 25,460 | $ | (2,315 | ) | $ | 2,829 | ||||||
U.S. Dollar | Canadian Dollar | 20,167 | (1,833 | ) | 2,241 | |||||||||
U.S. Dollar | Singapore Dollar | (17,397 | ) | 1,582 | (1,933 | ) | ||||||||
U.S. Dollar | Taiwanese Dollar | (13,584 | ) | 1,235 | (1,509 | ) | ||||||||
U.S. Dollar | Mexican Peso | 11,067 | (1,006 | ) | 1,230 | |||||||||
U.S. Dollar | Brazilian Real | 10,086 | (917 | ) | 1,121 | |||||||||
U.S. Dollar | Chinese Renminbi | (7,804 | ) | 709 | (867 | ) | ||||||||
U.S. Dollar | Japanese Yen | 6,944 | (631 | ) | 772 | |||||||||
U.S. Dollar | Swiss Franc | 2,843 | (258 | ) | 316 | |||||||||
Euro | Swedish Krona | (2,837 | ) | 258 | (315 | ) | ||||||||
Euro | Croatian Kuna | 1,450 | (132 | ) | 161 | |||||||||
Euro | British Pound | 1,295 | (118 | ) | 144 | |||||||||
Euro | U.S. Dollar | 1,295 | (118 | ) | 144 | |||||||||
Euro | Russian Ruble | (1,235 | ) | 112 | (137 | ) | ||||||||
U.S. Dollar | Korean Wan | (1,223 | ) | 111 | (136 | ) | ||||||||
U.S. Dollar | Indian Rupee | (1,087 | ) | 99 | (121 | ) | ||||||||
U.S. Dollar | Russian Ruble | 1,005 | (91 | ) | 112 | |||||||||
Euro | Norwegian Kroner | (997 | ) | 91 | (111 | ) | ||||||||
Euro | Polish Zloty | (943 | ) | 86 | (105 | ) | ||||||||
Euro | Arab Emirates Dirham | (913 | ) | 83 | (101 | ) | ||||||||
U.S. Dollar | Swedish Krona | (833 | ) | 76 | (93 | ) | ||||||||
U.S. Dollar | Norwegian Kroner | 594 | (54 | ) | 66 | |||||||||
U.S. Dollar | Hong Kong Dollar | (502 | ) | 46 | (56 | ) |
• | Our operating results are highly dependent on the volume and timing of orders received during the quarter, which are difficult to forecast. Customers generally order on an as-needed basis and we typically do not obtain firm, long-term purchase commitments from our customers. As a result, our revenues in any quarter depend primarily on orders booked and shipped in that quarter. |
• | A significant portion of our quarterly retail sales typically occurs in the last weeks of each quarter, further increasing the difficulty in predicting quarterly revenues and profitability. |
• | Our sales are impacted by consumer demand and current and future global economic and political conditions, including trade restrictions and tariffs, and can, therefore, fluctuate abruptly and significantly during periods of uncertain economic conditions or geographic distress, as well as from shifts in distributor inventory practices and consumer buying patterns. |
• | We must incur a large portion of our costs in advance of sales orders because we must plan research and production, order components, buy tooling equipment, and enter into development, sales and marketing, and other operating commitments prior to obtaining firm commitments from our customers. This makes it difficult for us to rapidly adjust our costs during the quarter in response to a revenue shortfall, which could adversely affect our operating results. |
• | We engage in acquisitions and divestitures, and such activity varies from period to period. Such variance may affect our growth, our previous outlook and expectations, and comparisons of our operating results and financial statements between periods. |
• | We have attempted to simplify our organization, to reduce operating costs through expense reduction and global workforce reductions, to reduce the complexity of our product portfolio, and to better align costs with our current business as we expand from PC accessories to growth opportunities in accessories and other products for music, gaming, video collaboration, digital home, mobile devices and other product categories. We may not achieve the cost savings or other anticipated benefits from these efforts, and the success or failure of such efforts may cause our operating results to fluctuate and to be difficult to predict. |
• | Fluctuations in currency exchange rates can impact our revenues, expenses and profitability because we report our financial statements in U.S. Dollars, whereas a significant portion of our revenues and expenses are in other currencies. We attempt to adjust product prices over time to offset the impact of currency movements. However, over short periods of time, during periods of weakness in consumer spending or given high levels of competition in many product categories, our ability to change local currency prices to offset the impact of currency fluctuations is limited. |
• | Develop innovative, high-quality, and reliable new products and enhancements in a cost-effective and timely manner; |
• | Difficulties in staffing and managing international operations; |
• | Compliance with laws and regulations, including environmental, tax, import/export and anti-corruption laws, which vary from country to country and over time, increasing the costs of compliance and potential risks of non-compliance; |
• | Varying laws, regulations and other legal protections, uncertain and varying enforcement of those laws and regulations, dependence on local authorities, and the importance of local networks and relationships; |
• | Exposure to political and financial instability, especially with the uncertainty associated with the ongoing sovereign debt crisis in certain Euro zone countries and the stability of the European Union, which may lead to reduced sales, currency exchange losses and collection difficulties or other losses; |
• | Political and economic uncertainty around the world, including uncertainty resulting from the recent United States presidential and congressional elections, change of administration in the United States and the United Kingdom's referendum in June 2016, and other national elections and policy shifts; |
• | Import or export restrictions or licensing requirements that could affect some of our products, including those with encryption technology; |
• | Trade protection measures, custom duties, tariffs, import or export duties, and other trade barriers, restrictions and regulations; |
• | Difficulties and increased costs in establishing sales and distribution channels in unfamiliar markets, with their own market characteristics and competition, including entrenched local competition; |
Share Buyback Program | Shares Approved | Approved Amounts | ||||
March 2017 | 17,311 | $ | 250,000 |
Total Number of Shares Repurchased | Weighted Average Price Paid Per Share | Remaining Amount that May Yet Be Repurchased under the Program | |||||||||||
During the three months ended | CHF (LOGN) | USD (LOGI) | |||||||||||
Month 1 | |||||||||||||
July 1, 2018 to July 27, 2018 | 132 | 44.58 | — | $ | 203,971 | ||||||||
Month 2 | |||||||||||||
July 28, 2018 to August 31, 2018 | 18 | 45.95 | — | 203,139 | |||||||||
Month 3 | |||||||||||||
September 1, 2018 to September 28, 2018 | 68 | 44.43 | — | 199,989 | |||||||||
Total | 218 | 44.64 | — | $ | 199,989 |
Exhibit No. | Description | |
2.1 | *** | |
10.1 | ** | |
31.1 | ||
31.2 | ||
32.1 | * | |
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema Document | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |
101.DEF | XBRL Taxonomy Definition Linkbase Document |
LOGITECH INTERNATIONAL S.A. | |||
October 25, 2018 | /s/ Bracken Darrell | ||
Date | Bracken Darrell | ||
President and | |||
Chief Executive Officer | |||
October 25, 2018 | /s/ Vincent Pilette | ||
Date | Vincent Pilette | ||
Chief Financial Officer | |||
STOCK PURCHASE AGREEMENT by and among BLUE MICROPHONES HOLDING CORPORATION, RIVERSIDE MICRO‑CAP FUND iI, l.p., THE OTHER STOCKHOLDERS OF BLUE MICROPHONES holding CORPORATION LISTED ON EXHIBIT A ATTACHED HERETO, THE OPTIONHOLDERS OF BLUE MICROPHONES holding CORPORATION LISTED ON EXHIBIT B ATTACHED HERETO LOGITECH EUROPE S.A. and, for purposes of Section 10.11 only, LOGITECH INC. Dated as of July 30, 2018 |
1. | Grant of Restricted Stock Units. The Company hereby grants to the Participant named below the number of Restricted Stock Units corresponding to Shares specified below, subject to the terms and conditions of this Agreement and of the Plan, which is incorporated in this Agreement by reference: |
Participant’s Name: | [NAME] |
Grant Date: | [GRANT DATE] |
Total Number of Restricted Stock: | [UNITS] |
2. | Vesting. The Restricted Stock Units subject to this Award shall vest with respect to 100% of the total Restricted Stock Units subject to this Award on the first anniversary of the Grant Date, or, if earlier and only if the Participant is not re-elected as a Director at such annual general meeting, the date of the next annual general meeting following the Grant Date (the “Vesting Date”), in each case, provided that the Participant is still providing Service on the Vesting Date. In no event shall any Restricted Stock Units vest after the Participant’s termination of Service. |
3. | Settlement of Vested Restricted Stock Units. The Participant’s vested Restricted Stock Units shall be settled in Shares promptly after the Vesting Date of such Restricted Stock Units, or accelerated vesting event pursuant to Section 5(b), provided that the Company shall have no obligation to issue Shares pursuant to this Agreement unless and until Participant has satisfied any applicable tax and/or other obligations pursuant to Section 7 below and such issuance otherwise complies with Applicable Laws. The foregoing notwithstanding, Restricted Stock Units shall in no event be settled later than the later of (i) the March 15 of the calendar year after the applicable Vesting Date or accelerated vesting event or (ii) the June 15 of the Company’s fiscal year after the applicable Vesting Date or accelerated vesting event. |
4. | Nature of Restricted Stock Units. The Restricted Stock Units are mere bookkeeping entries and represent only an unfunded and unsecured obligation of the Company to issue or deliver Shares on a future date. As a holder of Restricted Stock Units, the Participant has no rights other than the rights of a general creditor of the Company. The Restricted Stock Units carry neither voting rights nor rights to cash or other dividends. The Participant has no rights as a shareholder of the Company by virtue of the Restricted Stock Units unless and until the Restricted Stock Units are settled by issuing or delivering Shares. |
5. | Termination of Service. |
(a) | Except as otherwise provided in Section 5(b), if the Participant’s Service terminates for any reason, all unvested Restricted Stock Units shall be forfeited effective on the date the Participant’s Service terminates. The Administrator shall have the exclusive discretion to determine when the Participant’s Service terminates. |
(b) | If the Participant’s Service terminates by reason of death or Disability, any unvested Restricted Stock Units shall vest immediately as of the date of such termination of Service. For purposes of this Agreement, “Disability” means a medically determined physical or mental impairment rendering the Participant substantially unable to function as a member of the Board for a material portion of the Participant’s remaining term on the Board, as determined in the sole discretion of the Board (excluding any Participant whose own Disability is at issue in or based on a given case) based upon such evidence as it deems necessary and appropriate. A Participant shall not be considered to have experienced a Disability unless he or she furnishes such medical or other evidence of the existence of Disability as the Board, in its sole discretion, may require. |
6. | Suspension or Cancellation for Misconduct. If at any time (including after vesting but before settlement) the Administrator reasonably believes that the Participant has committed an act of misconduct as described in this Section 6, the Administrator may suspend the vesting or settlement of Restricted Stock Units, pending a determination of whether an act of misconduct has been committed. If the Administrator determines that the Participant has committed an act of embezzlement, fraud or breach of fiduciary duty, or if the Participant makes an unauthorized disclosure of any trade secret or confidential information of the Company or any of its Subsidiaries or Affiliates, or induces any customer to breach a contract with the Company or any of its Subsidiaries or Affiliates, then this Agreement shall terminate immediately and the Restricted Stock Units subject to this Award shall cease to be outstanding. Any determination by the Administrator with respect to the foregoing shall be final, conclusive and binding on all interested parties (it being understood that the Administrator for purposes of this Section 6 shall mean the Board). |
7. | Responsibility for Taxes. |
(a) | The Participant acknowledges that the Participant will consult with his or her personal tax advisor regarding any or all income tax, social insurance, payroll tax, payment on account or other tax-related items related to the Participant’s participation in the Plan and legally applicable to the Participant (“Tax-Related Items”). The Participant is relying solely on such advisor and is not relying in any part on any statement or representation of the Company or any of its agents. The Company will not be responsible for withholding any Tax-Related Items, unless required by Applicable Laws. The Company may take such action as it deems appropriate to ensure that all Tax-Related Items, which are the Participant’s sole and absolute responsibility, are withheld or collected from the Participant, if and to the extent required by Applicable Laws. In this regard, the Participant authorizes the Company or its agents, at their discretion, to satisfy any withholding obligation for Tax-Related Items by withholding in Shares upon the relevant taxable or tax withholding event, as applicable, unless the use of such withholding method is problematic under applicable tax or securities law or has materially adverse accounting consequences, in which case, the withholding obligation for Tax-Related Items may be satisfied by one or a combination of the following: (1) withholding from the Participant’s cash compensation paid to the Participant by the Company; or (2) withholding from proceeds of the sale of Shares acquired upon vesting/settlement of the Restricted Stock Units either through a voluntary sale or through a mandatory sale arranged by the Company (on the Participant’s behalf pursuant to this authorization). Depending on the withholding method, the Company may withhold or account for Tax-Related Items by considering tax rates of up to the maximum tax rates applicable in a particular jurisdiction, provided that if Shares are withheld or sold to cover Tax-Related Items, the Participant will receive a refund in cash of any amount that was over-withheld based on a tax rate that exceeds the Participant’s tax rate and will have no entitlement to the equivalent in Shares. If the obligation for Tax-Related Items is satisfied by withholding in Shares, for tax purposes, the Participant is deemed to have been issued the full number of Shares subject to the vested Restricted Stock Units, notwithstanding that a number of the Shares are held back solely for the purpose of paying the Tax-Related Items due as a result of any aspect of the Participant’s participation in the Plan. |
(b) | Finally, the Participant shall pay to the Company any amount of Tax-Related Items that the Company may be required to withhold or account for as a result of the Participant’s participation in the Plan that cannot be satisfied by the means previously described. The Company may refuse to issue or deliver the Shares or the proceeds of the sale of Shares, if the Participant fails to comply with the Participant’s obligations in connection with the Tax-Related Items. |
8. | Compliance with Applicable Laws; No Company Liability. No Shares shall be issued or delivered pursuant to the settlement of the Restricted Stock Units unless such issuance or delivery complies with Applicable Laws. The Company shall not be liable to the Participant or other persons as to (a) the non-issuance or delivery of Shares as to which the Company has been unable to obtain from any regulatory body having jurisdiction the authority deemed by the Company’s counsel to be necessary to the lawful issuance or delivery of any Shares hereunder and (b) any tax consequence expected, but not realized, by the Participant or other person due to the receipt, vesting or settlement of the Restricted Stock Units. |
9. | Non-Transferability of Restricted Stock Units. The Restricted Stock Units and this Agreement may not be transferred in any manner otherwise than by will, by the laws of descent or distribution or, if the Company permits, by a written beneficiary designation. The terms of the Plan and this Agreement shall be binding upon the executors, administrators, heirs, beneficiaries, successors and assigns of the Participant. |
10. | No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Participant’s participation in the Plan, or the Participant’s acquisition or sale of the underlying Shares. The Participant should consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan. |
11. | Nature of Grant. In accepting the grant, the Participant understands and agrees that: |
(a) | the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan; |
(b) | the grant of the Restricted Stock Units is voluntary and occasional and does not create any contractual or other right to receive future grants of Restricted Stock Units, or benefits in lieu of Restricted Stock Units, even if Restricted Stock Units have been granted in the past; |
(c) | all decisions with respect to future Restricted Stock Units grants, if any, will be at the sole discretion of the Company; |
(d) | the grant and Participant’s participation in the Plan shall not be interpreted as forming an employment or service contract with Company or any Subsidiary or Affiliate, and shall not interfere with the ability of the Company or any Subsidiary or Affiliate, as applicable, to terminate the Participant’s service relationship at any time; |
(e) | the Participant is voluntarily participating in the Plan; |
(f) | the future value of the underlying Shares is unknown, indeterminable, and cannot be predicted with certainty; |
(g) | no claim or entitlement to compensation or damages shall arise from forfeiture of the Restricted Stock Units resulting from termination of the Participant’s relationship as a Service Provider (for any reason whatsoever, whether or not later found to be invalid or in breach of labor laws in the jurisdiction where Participant is engaged as a Service Provider or the terms of Participant’s service agreement, if any); |
(h) | unless otherwise provided in the Plan or by the Company in its discretion, the Restricted Stock Units and the benefits evidenced by this Agreement do not create any entitlement to have the Restricted Stock Units or any such benefits transferred to, or assumed by, another company nor to be exchanged, cashed out or substituted for, in connection with any corporate transaction affecting the Shares of the Company; and |
(i) | neither the Company, nor any Subsidiary or Affiliate shall be liable for any foreign exchange rate fluctuation between the Participant’s local currency and the United States Dollar or the Swiss Franc, as applicable, that may affect the value of the Restricted Stock Units or of any amounts due to the Participant pursuant to the settlement of the Restricted Stock Units or the subsequent sale of any Shares acquired upon settlement. |
12. | Data Privacy. |
(a) | Data Collection and Usage. The Company or any of its Subsidiaries or Affiliates may collect, process and use certain personal information about the Participant, including, but not limited to, the Participant’s name, home address, telephone number(s), email address(es), date of birth, social insurance number, passport or other identification number, compensation, nationality, job title, any shares of stock or directorships held in the Company, details of all Restricted Stock Units or any other entitlement to shares of stock awarded, canceled, exercised, vested, unvested or outstanding in the Participant’s favor (“Data”), for the purposes of implementing, administering and managing the Plan. The legal basis, where required, for the processing of Data is the Participant’s consent. |
(b) | Stock Plan Administration Service Providers. The Company transfers Data to Equatex AG and Equatex US Inc. and their respective affiliates (the “Plan Broker”) and to other third-party service providers, which are assisting the Company with the implementation, administration and management of the Plan. In the future, the Company may select different service providers and share Data with such other providers serving in a similar manner. The Participant may be asked to agree on separate terms and data processing practices with the service providers, with such agreements being a condition to the ability to participate in the Plan. |
(c) | International Data Transfers. The Company and its service providers are based in Switzerland, the United States, the United Kingdom and/or Germany, and the Participant’s country or jurisdiction may have different data privacy laws and protections than these countries. For example, the European Commission has issued a limited adequacy finding with respect to the United States that applies only to the extent companies register for the EU-U.S. Privacy Shield program. The Company's legal basis, where required, for the transfer of Data is the Participant’s consent. |
(d) | Data Retention. The Company will hold and use the Data only as long as is necessary to implement, administer and manage the Participant’s participation in the Plan, or as required to comply with legal or regulatory obligations, including under tax and security laws. |
(e) | Voluntariness and Consequences of Consent Denial or Withdrawal. Participation in the Plan is voluntary and the Participant is providing the consents herein on a purely voluntary basis. If the Participant does not consent, or if the Participant later seeks to revoke the Participant’s consent, the Participant’s compensation from or service relationship with the Company will not be affected; the only consequence of refusing or withdrawing the Participant’s consent is that the Company would not be able to grant Restricted Stock Units or other awards to the Participant or administer or maintain such awards, and the Participant would no longer be able to participate in the Plan and would forfeit opportunities associated with the Plan. |
13. | Exchange Control and Foreign Asset/Account Reporting Acknowledgement. Local foreign exchange laws may affect the grant of the Restricted Stock Units, the receipt of Shares upon settlement of the Restricted Stock Units, the sale of Shares received upon settlement of the Restricted Stock Units and/or the receipt of dividends or dividend equivalents (if any). Such laws may affect the Participant’s ability to hold funds outside of the Participant’s country and may require the repatriation of any cash, dividends or dividend equivalents received |
14. | Adjustments Upon Changes in Capitalization. In the event of a declaration of a stock dividend, a stock split, combination or reclassification of shares, extraordinary dividend of cash and/or assets, recapitalization, reorganization or any similar event affecting the Shares or other securities of the Company, the Administrator shall equitably adjust the number and kind of Restricted Stock Units or other securities which are subject to this Agreement, in order to reflect such change and thereby preclude a dilution or enlargement of benefits under this Agreement. |
15. | Entire Agreement; Governing Law. The Plan and this Agreement constitute the entire agreement of the parties with respect to the subject matter of this Agreement and supersede in their entirety all prior undertakings and agreements of the Company and the Participant with respect to the subject matter of this Agreement. This Agreement is governed by the internal substantive laws, but not the choice of law rules of Switzerland (the Company’s jurisdiction of organization). |
16. | Language. If the Participant has received this Agreement or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control. |
17. | Electronic Delivery. The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. |
18. | Severability. The provisions of this Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable. |
19. | Appendix. Notwithstanding any provisions in this Agreement, the Restricted Stock Units grant shall be subject to any special terms and conditions set forth in any Appendix to this Agreement for the Participant’s country. Moreover, if the Participant relocates to one of the countries included in the Appendix, the special terms and conditions for such country will apply to the Participant, to the extent the Company determines that the application of such terms and conditions is necessary or advisable in order to comply with local law or facilitate the administration of the Plan. The Appendix constitutes part of this Agreement. |
20. | Imposition of Other Requirements. The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on the Restricted Stock Units and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable in order to facilitate compliance with local law or the administration of the Plan, and to require the Participant to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing. |
21. | Permitted Modifications to Comply with Laws. The Company reserves the right to unilaterally amend this Agreement to facilitate compliance with existing or adopted applicable ordinances, laws, rules or regulations |
22. | Insider Trading Restrictions/Market Abuse Laws. The Participant may be subject to insider trading restrictions and/or market abuse laws in applicable jurisdictions, including, but not limited to, Switzerland, the United States and the Participant’s country, which may affect the Participant’s ability to accept, acquire, sell or otherwise dispose of Shares, rights to Shares (e.g., Restricted Stock Units) or rights linked to the value of Shares under the Plan during such times as the Participant is considered to have “inside information” regarding the Company (as defined by the laws in the applicable jurisdictions). Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable Company insider trading policy. Neither the Company nor any of its Subsidiaries or Affiliates will be responsible for such restrictions or liable for the failure on the Participant’s part to know and abide by such restrictions. The Participant should consult with his or her own personal legal advisers to ensure compliance with local laws. |
PARTICIPANT: | THE COMPANY: | |||||
By: | ||||||
Signature: | Title: | |||||
Print Name: |
October 25, 2018 | |
/s/ Bracken Darrell | |
Bracken Darrell | |
President and Chief Executive Officer |
October 25, 2018 | |
/s/ Vincent Pilette | |
Vincent Pilette | |
Chief Financial Officer |
October 25, 2018 | |
/s/ Bracken Darrell | |
Bracken Darrell | |
President and | |
Chief Executive Officer | |
/s/ Vincent Pilette | |
Vincent Pilette | |
Chief Financial Officer |
Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Oct. 10, 2018 |
|
Document and Entity Information | ||
Entity Registrant Name | LOGITECH INTERNATIONAL SA | |
Entity Central Index Key | 0001032975 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 165,670,205 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Entity Emerging Growth Company | false | |
Entity Small Business | false |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
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Sep. 30, 2018
USD ($)
$ / shares
shares
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Sep. 30, 2017
USD ($)
$ / shares
shares
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Sep. 30, 2018
USD ($)
$ / shares
shares
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Sep. 30, 2017
USD ($)
$ / shares
shares
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Income Statement [Abstract] | ||||
Net sales | $ 691,146 | $ 632,470 | $ 1,299,626 | $ 1,162,416 |
Cost of goods sold | 432,063 | 402,722 | 814,234 | 737,496 |
Amortization of intangible assets and purchase accounting effect on inventory | 2,966 | 2,011 | 5,338 | 3,515 |
Gross profit | 256,117 | 227,737 | 480,054 | 421,405 |
Operating expenses: | ||||
Marketing and selling | 121,801 | 107,386 | 236,385 | 209,764 |
Research and development | 39,542 | 36,647 | 78,529 | 71,746 |
General and administrative | 25,206 | 25,266 | 50,679 | 50,675 |
Amortization of intangible assets and acquisition-related costs | 4,317 | 2,491 | 6,838 | 3,881 |
Change in fair value of contingent consideration for business acquisition | 0 | (2,930) | 0 | (4,908) |
Restructuring charges (credits), net | 119 | (61) | 10,040 | (116) |
Total operating expenses | 190,985 | 168,799 | 382,471 | 331,042 |
Operating income | 65,132 | 58,938 | 97,583 | 90,363 |
Interest income | 1,858 | 1,048 | 4,227 | 2,223 |
Other income (expense), net | 3,389 | 459 | 1,818 | (570) |
Income before income taxes | 70,379 | 60,445 | 103,628 | 92,016 |
Provision for (benefit from) income taxes | 6,203 | 4,087 | 986 | (1,349) |
Net income | $ 64,176 | $ 56,358 | $ 102,642 | $ 93,365 |
Net income per share: | ||||
Net income per share - basic (in dollars per share) | $ / shares | $ 0.39 | $ 0.34 | $ 0.62 | $ 0.57 |
Net income per share - diluted (in dollars per share) | $ / shares | $ 0.38 | $ 0.33 | $ 0.61 | $ 0.55 |
Weighted average shares used to compute net income per share: | ||||
Basic (in shares) | shares | 165,630 | 164,120 | 165,474 | 163,765 |
Diluted (in shares) | shares | 169,234 | 169,078 | 168,996 | 168,710 |
Cash dividend per share (in dollars per share) | (per share) | $ 0.69 | $ 0.63 | $ 0.69 | $ 0.63 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 64,176 | $ 56,358 | $ 102,642 | $ 93,365 |
Other comprehensive income (loss): | ||||
Currency translation gain (loss), net of taxes | (2,863) | 2,185 | (7,826) | 3,641 |
Defined benefit pension plans: | ||||
Net gain and prior service costs, net of taxes | 192 | 532 | 98 | 380 |
Amortization included in other income (expense), net | (69) | 52 | (139) | 102 |
Hedging gain (loss): | ||||
Deferred hedging gain (loss), net of taxes | 298 | (2,140) | 485 | (5,349) |
Reclassification of hedging loss included in cost of goods sold | 218 | 2,596 | 3,069 | 3,129 |
Other comprehensive income (loss) | (2,224) | 3,225 | (4,313) | 1,903 |
Total comprehensive income | $ 61,952 | $ 59,583 | $ 98,329 | $ 95,268 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - SFr / shares |
Sep. 30, 2018 |
Mar. 31, 2018 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Shares, par value (in CHF per share) | SFr 0.25 | SFr 0.25 |
Shares, issued (in shares) | 173,106,000 | 173,106,000 |
Shares that may be issued out of conditional capital (in shares) | 50,000,000 | 50,000,000 |
Shares that may be issued out of the authorized capital (in shares) | 34,621,324 | 0 |
Treasury, at cost, shares (in shares) | 7,384,000 | 8,527,000 |
The Company and Summary of Significant Accounting Policies and Estimates |
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Sep. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The Company and Summary of Significant Accounting Policies and Estimates | The Company and Summary of Significant Accounting Policies and Estimates The Company Logitech International S.A, together with its consolidated subsidiaries, ("Logitech" or the "Company") designs, manufactures and markets products that help connect people to digital and cloud experiences. More than 35 years ago, Logitech created products to improve experiences around the personal PC platform, and today it is a multi-brand, multi-category company designing products that enable better experiences consuming, sharing and creating any digital content such as music, gaming, video and computing, whether it is on a computer, mobile device or in the cloud. The Company sells its products to a broad network of domestic and international customers, including direct sales to retailers and e-tailers and indirect sales through distributors. Logitech was founded in Switzerland in 1981 and Logitech International S.A. has been the parent holding company of Logitech since 1988. Logitech International S.A. is a Swiss holding company with its registered office in Apples, Switzerland and headquarters in Lausanne, Switzerland, which conducts its business through subsidiaries in the Americas, Europe, Middle East and Africa ("EMEA") and Asia Pacific. Shares of Logitech International S.A. are listed on both the SIX Swiss Exchange under the trading symbol LOGN and the Nasdaq Global Select Market under the trading symbol LOGI. Business Acquisition In August 2018, the Company acquired Blue Microphones Holding Corporation. See "Note 2 - Business Acquisition" for more information. Basis of Presentation The condensed consolidated interim financial statements include the accounts of Logitech and its subsidiaries. All intercompany balances and transactions have been eliminated. The condensed consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and therefore do not include all the information required by GAAP for complete financial statements. They should be read in conjunction with the Company’s audited consolidated financial statements for the fiscal year ended March 31, 2018, included in its Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on May 21, 2018. In the opinion of management, these condensed consolidated financial statements include all adjustments, consisting of only normal and recurring adjustments, necessary and in all material aspects, for a fair statement of the results of operations, comprehensive income, financial position, cash flows and changes in shareholders' equity for the periods presented. Operating results for the three and six months ended September 30, 2018 are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2019, or any future periods. Reclassification Certain amounts from the comparative period in the accompanying condensed consolidated financial statements have been reclassified to conform to the condensed consolidated financial statement presentation as of and for the three and six months ended September 30, 2018. Changes in Significant Accounting Policies Other than the recent accounting pronouncements adopted and discussed below under Recent Accounting Pronouncements Adopted and Summary of Significant Accounting Policies, there have been no changes in the Company’s significant accounting policies during the six months ended September 30, 2018 compared with the significant accounting policies described in its Annual Report on Form 10-K for the fiscal year ended March 31, 2018. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make judgments, estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements. Management bases its estimates on historical experience and various other assumptions believed to be reasonable. Significant estimates and assumptions made by management involve the fair value of goodwill, intangible assets acquired from business acquisitions, warranty liabilities, accruals for customer incentives, cooperative marketing, and pricing programs ("Customer Programs") and related breakage when appropriate, accrued revenue reserve from returns, allowance for doubtful accounts, inventory valuation, contingent consideration from business acquisitions and periodical reassessment of its fair value, share-based compensation expense, uncertain tax positions, and valuation allowances for deferred tax assets. Although these estimates are based on management’s best knowledge of current events and actions that may impact the Company in the future, actual results could differ materially from these estimates. Recent Accounting Pronouncements Adopted In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, "Revenue from Contracts with Customers (Topic 606)" ("ASU 2014-09" or “Topic 606”) which supersedes the revenue recognition requirements under ASC 605 (“Topic 605”), Revenue Recognition. ASU 2014-09 outlines a new, single, comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes existing revenue recognition guidance, including industry-specific guidance. Under the new guidance, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard requires reporting companies to disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. On April 1, 2018, the Company adopted the new standard and all related amendments using the modified retrospective method applied to those contracts which were not completed as of April 1, 2018. Results for reporting periods beginning after April 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with historic accounting standards under Topic 605. As result of the adoption of the new standard, the Company recorded: a) a reduction to retained earnings as of April 1, 2018; and b) reclassifications of certain allowances for sales returns and certain other Customer Programs from accounts receivable, net to accrued and other current liabilities and other current assets. The cumulative effect of the changes to the condensed consolidated balance sheet from the adoption of Topic 606 was as follows (in thousands):
Net Reduction to Retained Earnings as of April 1, 2018
Balance Sheet Reclassifications
Certain balances of allowances for sales return and accruals for Customer Programs which were accrued based on Customer Program offers made to individual customers, met the right of offset criteria in accordance with ASC 210-20, "Balance Sheet (Topic 210)", and are still included within accounts receivable, net. The adoption of Topic 606 did not have an impact over the total cash flows from operating, investing, or financing activities. The following tables summarize the impacts of adopting Topic 606 on the Company’s condensed consolidated statements of operations for the three and six months ended September 30, 2018 and condensed consolidated balance sheet as of September 30, 2018 (in thousands):
In January 2016, the FASB issued ASU 2016-01, "Financial Instruments-Recognition and Measurement of Financial Assets and Financial Liabilities (Subtopic 825-10)" ("ASU 2016-01"). ASU 2016-01 requires entities to measure equity instruments at fair value and recognize any changes in fair value within the statement of operations. The Company adopted ASU 2016-01 effective April 1, 2018 on a prospective basis for its privately held strategic equity securities without readily determinable fair values. The Company elected the measurement alternative to record these investments at cost and to adjust for impairments and observable price changes with a same or similar security from the same issuer within the statement of operations. The adoption of ASU 2016-01 did not have a material impact on the Company's condensed consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, "Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory" ("ASU 2016-16"), which eliminates the deferral of income tax effects of intra-entity asset transfers until the transferred asset is sold to an unrelated party or recovered through use. However, this standard does not apply to intra-entity transfer of inventory. The Company adopted this standard effective April 1, 2018 on a modified retrospective basis, and the adoption of ASU 2016-16 did not have a material impact on its condensed consolidated financial statements. In December 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash" ("ASU 2016-18"), which requires that a statement of cash flows explains the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. The Company adopted this standard effective April 1, 2018, utilizing the retrospective transition method to each period presented and the adoption of ASU 2016-18 did not have an impact on its condensed consolidated financial statements as the Company did not have restricted cash for either periods presented. In January 2017, the FASB issued ASU 2017-01, "Business Combination (Topic 805): Clarifying the Definition of a Business" ("ASU 2017-01"), which changes the definition of a business to assist with evaluating when a set of transferred assets and activities is a business. The Company adopted this standard effective April 1, 2018, and the adoption of ASU 2017-01 did not have a material impact on its condensed consolidated financial statements. In March 2017, the FASB issued ASU 2017-07, "Compensation-Retirement Benefit (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost" ("ASU 2017-07"), which requires that the Company disaggregate the service cost component from the other components of net benefit cost, and also provides guidance on how to present the service cost component and the other components of net benefit cost in the income statement and allow only the service cost component of net benefit cost to be eligible for capitalization. The Company adopted this standard effective April 1, 2018 using a retrospective adoption method. Other than the revised statement of operations presentation for the periods in the current year, the adoption of ASU 2017-07 did not have an impact on the Company’s condensed consolidated financial statements. The impact to the comparative period was immaterial and therefore the prior period statements of operations was not revised. In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities" ("ASU 2017-12"), which improves the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements and simplifies the application of the hedge accounting guidance. The Company adopted this standard prospectively on April 1, 2018, and the adoption of ASU 2017-12 did not have a material impact on its condensed consolidated financial statements. In accordance with ASU 2017-12, the Company has started presenting the earnings impact from forward points in cost of goods sold line item, which is used to present the earnings impact of the hedged item. Recent Accounting Pronouncements to be Adopted In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)" ("ASU 2016-02" or "Topic 842"), which generally requires companies to recognize right-of-use assets and lease liabilities arising from operating and financing leases with terms longer than 12 months in the consolidated balance sheets. The Company will adopt the new guidance in the first quarter of fiscal year 2020 on a modified retrospective basis, which recognizes the cumulative effect of initially applying Topic 842 as an adjustment to retained earnings at the adoption date. Although the Company expects to record significant amounts of right-of-use assets and liabilities on its condensed consolidated balance sheets, the Company is still evaluating the full impact that ASU 2016-02 will have on its condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurements" ("ASU 2018-13"), which aims to improve the overall usefulness of disclosures to financial statement users and reduce unnecessary costs to companies when preparing fair value measurement disclosures. ASU 2018-13 is effective for annual and interim periods in fiscal years beginning after December 15, 2019. Early adoption is permitted. Retrospective adoption is required, except for certain disclosures which will be required to be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. The Company is evaluating the full effect that ASU 2018-13 will have on its condensed consolidated financial statements and the timing of adoption. In August 2018, the FASB issued ASU 2018-14, "Compensation - Retirement Benefits - Defined Benefits Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans" ("ASU 2018-14"), which aims to improve the overall usefulness of disclosures to financial statement users and reduce unnecessary costs to companies when preparing defined benefit plan disclosures. ASU 2018-14 is effective for annual periods in fiscal years ending after December 15, 2021. Retrospective adoption is required and early adoption is permitted. The Company is evaluating the full effect that ASU 2018-14 will have on its condensed consolidated financial statements and the timing of adoption. In August 2018, the FASB issued ASU 2018-15, "Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract" ("ASU 2018-15"), which clarifies that implementation costs incurred by customers in cloud computing arrangements are deferred if they would be capitalized by customers in software licensing arrangements under the internal-use software guidance. ASU 2018-15 is effective for annual and interim periods in fiscal years beginning after December 15, 2019, with early adoption permitted. Entities have the option to apply the guidance prospectively to all implementation costs incurred after the date of adoption or retrospectively. The Company is evaluating the full effect that ASU 2018-15 will have on its condensed consolidated financial statements and the timing of adoption. Summary of Significant Accounting Policies Revenue Recognition Revenue is recognized when a customer obtains control of promised goods or service in an amount that reflects the transaction price the Company expects to receive in exchange for those goods or services. Substantially all revenue recognized by the Company relates to the contracts with customers to sell products that allow people to connect through music, gaming, video, computing, and other digital platforms. These products are hardware devices, which may include embedded software, and these functions together are considered as one performance obligation. Hardware devices are generally plug and play, requiring no configuration and little or no installation. Revenue is recognized at a point in time when control of the products is transferred to the customer which generally occurs upon shipment. The Company’s contracts with its customers generally have a term of no more than one year. The Company applies the practical expedient of not disclosing the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. The Company also provides post-contract customer support (“PCS”) for products and related software, which includes unspecified software updates and upgrades, bug fixes and maintenance. The transaction price is allocated to two performance obligations in such contracts, based on a relative standalone selling price. The transaction price allocated to PCS is recognized as revenue on a straight-line basis over the estimated term of the support, which is between one to two years, and is not material for the periods presented herein. Deferred revenue associated with remaining PCS performance obligation is not material as of September 30, 2018 and March 31, 2018. The Company normally requires payments from customers within thirty to sixty days from invoice date. However, terms may vary by customer type, by country and by selling season. Extended payment terms are sometimes offered to a limited number of customers during the second and third fiscal quarters. The Company does not modify payment terms on existing receivables. The Company's contracts with customers typically do not include significant financing components as the period between the satisfaction of performance obligations and timing of payment are generally within one year. The transaction price received by the Company from sales to its distributors, retail companies ("retailers"), and authorized resellers is calculated as selling price net of variable consideration which may include product returns, price protection, and the Company’s payments for Customer Programs related to current period product revenue. The estimated impact of these programs is recorded as a reduction of sales or as an operating expense if the Company receives a distinct good or service from the customer and can reasonably estimate the fair value of that good or service received. Significant management judgment and estimates are used to determine the impact of these programs in any accounting period. Certain Customer Programs require management to estimate the percentage of those programs which will not be claimed or will not be earned by customers based on historical experience and on the specific terms and conditions of particular programs. The percentage of these customer programs that will not be claimed or earned is commonly referred to as "breakage". The Company accounts for breakage as part of variable consideration, subject to constraint, and records the estimated impact in the same period when revenue is recognized at the expected value considering constraints. Significant management judgments and estimates are used to determine the breakage of the programs in any accounting period. The Company enters into cooperative marketing arrangements with many of its customers and with certain indirect partners, allowing customers to receive a credit equal to a set percentage of their purchases of the Company's products, or a fixed dollar credit for various marketing and incentive programs. The objective of these arrangements is to encourage advertising and promotional events to increase sales of the Company's products. Customer incentive programs include consumer rebates and performance-based incentives. Consumer rebates are offered to the Company's customers and indirect partners at the Company's discretion for the primary benefit of end-users. In addition, the Company offers performance-based incentives to many of its customers and indirect partners based on predetermined performance criteria. At management's discretion, the Company also offers special pricing discounts to certain customers. Special pricing discounts are usually offered only for limited time periods or for sales of selected products to specific indirect partners. Estimates of required accruals for cooperative marketing arrangements and customer incentive programs are determined based on negotiated terms, consideration of historical experience, forecasted incentives, anticipated volume of future purchases, and inventory levels in the channel. The Company has agreements with certain customers that contain terms allowing price protection credits to be issued in the event of a subsequent price reduction. Management's decision to make price reductions is influenced by product life cycle stage, market acceptance of products, the competitive environment, new product introductions and other factors. Accruals for estimated expected future pricing actions are recognized at the time of sale based on analyses of historical pricing actions by customer and by product, inventories owned by and located at customers, current customer demand, current operating conditions, and other relevant customer and product information, such as stage of product life-cycle. Product return rights vary by customer. Estimates of expected future product returns qualify as variable consideration and are recorded as a reduction of the transaction price of the contract at the time of sale based on analyses of historical return trends by customer and by product, inventories owned by and located at customers, current customer demand, current operating conditions, and other relevant customer and product information. The Company assesses the estimated returned asset value for impairment, and adjusts the value of the asset if it becomes impaired. Return trends are influenced by product life cycle status, new product introductions, market acceptance of products, sales levels, product sell-through, the type of customer, seasonality, product quality issues, competitive pressures, operational policies and procedures, and other factors. Return rates can fluctuate over time but are sufficiently predictable to allow the Company to estimate expected future product returns. Typically, variable consideration does not need to be constrained as estimates are based on predictive historical data or future commitments that are planned and controlled by the Company. However, the Company continues to assess variable consideration estimates such that it is probable that a significant reversal of revenue will not occur. The Company regularly evaluates the adequacy of its estimates for Customer Programs and product returns. Future market conditions and product transitions may require the Company to take action to change such programs and related estimates. When the variables used to estimate these costs change, or if actual costs differ significantly from the estimates, the Company would be required to record incremental increases or reductions to sales or operating expenses. Sales taxes and value added taxes (“VAT”) collected from customers, if applicable, which are remitted to governmental authorities are not included in revenue, and are reflected as a liability on the condensed consolidated balance sheets. The Company has elected to exclude sales taxes from the revenue recognized from contracts with customers. Shipping and Handling Costs The Company's shipping and handling costs are included in cost of goods sold in the condensed consolidated statements of operations for all periods presented. Contract Balances The Company records accounts receivable from contracts with customers when it has an unconditional right to consideration, as accounts receivable, net on the condensed consolidated balance sheet. The Company records contract liabilities when cash payments are received or due in advance of performance, primarily for implied support and subscriptions. Contract liabilities are included in accrual and other current liabilities on the condensed consolidated balance sheets. As of September 30, 2018 and for the period then ended, and as of April 1, 2018, the Company did not have any material contract liabilities balances or changes. Contract Costs The Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that otherwise would have been recognized is one year or less. These costs are included in marketing and selling expenses in the condensed consolidated statements of operations. As of September 30, 2018 and for the period then ended, and as of April 1, 2018, the Company did not have material deferred contract costs or changes. Allowances for Doubtful Accounts Allowances for doubtful accounts are maintained for estimated losses resulting from the Company's customers' inability to make required payments. The allowances are based on the Company's regular assessment of the financial condition of specific customers, as well as its historical experience with bad debts and customer deductions, receivables aging, current economic trends, geographic or country specific risks and the financial condition of its distribution channels. |
Business Acquisition Business Acquisition |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition | Business Acquisition Blue Microphones Acquisition On August 21, 2018 (the "Acquisition Date"), the Company acquired all equity interests in Blue Microphones Holding Corporation ("Blue Microphones") for a total consideration of $134.9 million in cash (the "Blue Microphones Acquisition"), which includes a working capital adjustment and repayment of debt on behalf of Blue Microphones. Blue Microphones is a leading audio manufacturer that designs and produces microphones, headphones, recording tools, and accessories for audio professionals, musicians and consumers. The Blue Microphones Acquisition is consistent with Logitech's merger and acquisition strategy and will supplement the Company's portfolio opportunities. Blue Microphones meets the definition of a business, and therefore the acquisition is accounted for using the acquisition method. The following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the Acquisition Date (in thousands):
Goodwill related to the acquisition is primarily attributable to opportunities and economies of scale from combining the operations and technologies of Logitech and Blue Microphones and is not deductible for tax purposes. The fair value of the inventory acquired is estimated at its net realizable value, which uses the estimated selling prices, less the cost of disposal and a reasonable profit allowance for the selling efforts. The difference between the fair value of the inventories and the amount recorded by Blue Microphones immediately before the acquisition date is $1.8 million, which will be recognized in "amortization of intangibles assets and purchase accounting effect on inventory" in the condensed consolidated statements of operations upon the sale of the acquired inventory. The following table summarizes the preliminary estimated fair values and estimated useful lives of the components of identifiable intangible assets acquired as of the Acquisition Date (Dollars in thousands):
Intangible assets acquired as a result of the Blue Microphones Acquisition are being amortized over their estimated useful lives using the straight-line method of amortization, which materially approximates the distribution of the economic value of the identified intangible assets. Amortization of acquired developed technology of $0.2 million during the three months ended September 30, 2018 is included in "amortization of intangible assets and purchase accounting effect of inventory" in the condensed consolidated statements of operations. Amortization of the acquired customer relationships and trade name of $0.3 million during the three months ended September 30, 2018 is included in "amortization of intangible assets and acquisition-related costs" in the condensed consolidated statements of operations. Developed technology relates to existing Blue Microphones products. The economic useful life was determined based on the technology cycle related to developed technology of existing products, as well as the cash flows anticipated over the forecasted periods. Customer relationships represent the fair value of future projected revenue that will be derived from sales of products to existing customers of Blue Microphones. The economic useful life was determined based on historical customer turnover rates and industry benchmarks. Trade name relates to the “Blue Microphones” trade name. The economic useful life was determined based on the expected life of the trade name and the cash flows anticipated over the forecasted periods. The fair values of developed technology and trade name were estimated using the relief-from-royalty method, an income approach (Level 3), which estimates the cost savings that accrue to the owner of the intangible assets that would otherwise be payable as royalties or license fees on revenues earned through the use of the asset. A royalty rate is applied to the projected revenues associated with the intangible assets to determine the amount of savings, which is then discounted to determine the fair value. The developed technology and trade name were valued using royalty rates of 10% and 3%, respectively, and both were discounted at a rate of 11%. The fair value of customer relationships was estimated using the excess earnings method, an income approach (Level 3), which converts projected revenues and costs into cash flows. To reflect the fact that certain other assets contributed to the cash flows generated, the returns for these contributory assets were removed to arrive at estimated cash flows solely attributable to the customer relationships, which were discounted at a rate of 11%. The Company believes the preliminary fair values of purchased intangible assets recorded above represents their fair values and approximates the amounts a market participant would pay for these intangible assets as of the Acquisition Date. The fair value of identifiable intangible assets acquired was based on estimates and assumptions made by management at the time of the acquisition. As additional information becomes available, such as finalization of the estimated fair value of the assets acquired and liabilities assumed, and working capital adjustments that may affect the total consideration transferred, the Company may revise its preliminary estimates of fair values during the remainder of the measurement periods (which will not exceed 12 months from the Acquisition Date). Any such revisions or changes may be material as we finalize the fair values of the tangible and intangible assets acquired and liabilities assumed. The Company incurred acquisition-related costs for the Blue Microphones Acquisition of approximately $1.5 million for the three months ended September 30, 2018. The acquisition-related costs are included in "amortization of intangible assets and acquisition-related costs" in the condensed consolidated statements of operations. The Company included Blue Microphones' estimated fair value of assets acquired and liabilities assumed in its condensed consolidated balance sheet beginning on the Acquisition Date. The results of operations for Blue Microphones subsequent to the Acquisition Date have been included in, but are not material to, the Company's condensed consolidated statements of operations. Pro forma results of operations for the Blue Microphones Acquisition have not been presented because they are not material to the condensed consolidated statements of operations. For the three months ended September 30, 2018, Blue Microphones, the acquisition of which was closed on August 21, 2018, contributed $7.7 million to net sales, representing approximately 1% of the net sales of the Company for the three-month period. |
Net Income Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income Per Share | Net Income Per Share The computations of basic and diluted net income per share for the Company were as follows (in thousands, except per share amounts):
Share equivalents attributable to outstanding stock options, restricted stock units ("RSUs") and ESPP totaling 0.8 million and 0.6 million for the three months ended September 30, 2018 and 2017, respectively, and 1.2 million and 1.2 million for the six months ended September 30, 2018 and 2017, respectively, were excluded from the calculation of diluted net income per share because the combined exercise price and average unamortized grant date fair value upon exercise of these options and ESPP or vesting of RSUs were greater than the average market price of the Company's shares during the periods presented herein, and therefore their inclusion would have been anti-dilutive. |
Employee Benefit Plans |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefit Plans | Employee Benefit Plans Employee Share Purchase Plans and Stock Incentive Plans As of September 30, 2018, the Company offers the 2006 ESPP (2006 Employee Share Purchase Plan (Non-U.S.)), the 1996 ESPP (1996 Employee Share Purchase Plan (U.S.)), the 2006 Plan (2006 Stock Incentive Plan) and the 2012 Plan (2012 Stock Inducement Equity Plan), each as amended. The following table summarizes the share-based compensation expense and total income tax benefit recognized for share-based awards for the three and six months ended September 30, 2018 and 2017 (in thousands):
The income tax benefit in the respective period primarily consists of tax benefit related to the share-based compensation expense for the period and direct tax benefit realized, including net excess tax benefits recognized from share-based awards vested or exercised during the period. As of September 30, 2018 and 2017, the balances of capitalized share-based compensation included in inventory were both $0.8 million. Defined Benefit Plans Certain of the Company’s subsidiaries sponsor defined benefit pension plans or non-retirement post-employment benefits covering substantially all of their employees. Benefits are provided based on employees’ years of service and earnings, or in accordance with applicable employee benefit regulations. The Company’s practice is to fund amounts sufficient to meet the requirements set forth in the applicable employee benefit and tax regulations. The cost recorded of $2.2 million and $2.3 million for the three months ended September 30, 2018 and 2017, respectively, and $4.5 million and $4.6 million for the six months ended September 30, 2018 and 2017, respectively, was primarily related to service costs. |
Income Taxes |
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Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company is incorporated in Switzerland but operates in various countries with differing tax laws and rates. Further, a portion of the Company’s income before taxes and the provision for (benefit from) income taxes are generated outside of Switzerland. The Company has not adjusted the net provisional charge from remeasuring deferred tax assets related to the Tax Cuts and Jobs Act (the "Tax Act") in the United States in fiscal year 2018. The Company continues to refine the estimate based on ongoing analysis and available information and interpretations through the third quarter of fiscal year 2019. The income tax provision for the three months ended September 30, 2018 was $6.2 million based on an effective income tax rate of 8.8% of pre-tax income, compared to an income tax provision of $4.1 million based on an effective income tax rate of 6.8% of pre-tax income for the three months ended September 30, 2017. The income tax provision for the six months ended September 30, 2018 was $1.0 million based on an effective income tax rate of 1.0% of pre-tax income, compared to an income tax benefit of $1.3 million based on an effective income tax rate of (1.5)% of pre-tax income for the six months ended September 30, 2017. The changes in the effective income tax rate for the three and six months ended September 30, 2018, compared to the three and six months ended September 30, 2017, were primarily due to the mix of income and losses in the various tax jurisdictions which the Company operates and less excess tax benefits recognized in the United States in the three and six months ended September 30, 2018. The Company recognized excess tax benefits of $0.7 million and $9.0 million, respectively, at 21% federal corporate income tax rate post the Tax Act in the three and six months ended September 30, 2018. In the same periods in fiscal year 2018, the Company recognized $1.1 million and $11.0 million of excess tax benefits, respectively, at 35% federal corporate income tax rate, after adoption of ASU 2016-09. In the three and six months ended September 30, 2018, there were discrete tax benefits of $0.5 million and $1.4 million, respectively, from the reversal of uncertain tax positions from the expiration of statutes of limitations. In the same periods ended September 30, 2017, the tax benefits from reversal of uncertain tax positions from the expiration of statutes of limitations were $0.7 million and $1.3 million, respectively. As of September 30, 2018 and March 31, 2018, the total amount of unrecognized tax benefits due to uncertain tax positions was $70.4 million and $69.1 million, respectively, all of which would affect the effective income tax rate if recognized. As of September 30, 2018 and March 31, 2018, the Company had $34.5 million and $35.0 million, respectively, in non-current income taxes payable including interest and penalties, related to the Company's income tax liability for uncertain tax positions. The Company recognizes interest and penalties related to unrecognized tax positions in income tax expense. As of September 30, 2018 and March 31, 2018, the Company had $2.5 million and $2.3 million, respectively, of accrued interest and penalties related to uncertain tax positions. Although the Company has adequately provided for uncertain tax positions, the provisions on these positions may change as revised estimates are made or the underlying matters are settled or otherwise resolved. During fiscal year 2019, the Company continues to review its tax positions and provide for or reverse unrecognized tax benefits as issues arise. During the next twelve months, it is reasonably possible that the amount of unrecognized tax benefits could increase or decrease significantly due to changes in tax law in various jurisdictions, new tax audits and changes in the U.S. dollar as compared to other currencies. Excluding these factors, uncertain tax positions may decrease by as much as $3.3 million from the lapse of the statutes of limitations in various jurisdictions during the next twelve months. |
Balance Sheet Components |
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Balance Sheet Components | Balance Sheet Components The following table presents the components of certain balance sheet asset amounts as of September 30 and March 31, 2018 (in thousands):
The following table presents the components of certain balance sheet liability amounts as of September 30 and March 31, 2018 (in thousands):
(1) Certain allowances for sales return and certain other Customer Programs were included within accounts receivable, net balance as of March 31, 2018. Upon adoption of Topic 606, such balances are presented as accrued revenue reserve from returns and accrued customer marketing, pricing and incentive programs included in accrued and other current liabilities, and as return assets included in other current assets, respectively, on the condensed consolidated balance sheet as of September 30, 2018. Refer to Note 1 to the condensed consolidated financial statements for more information. |
Fair Value Measurements |
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Financial Instruments, Owned, at Fair Value [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements Fair Value Measurements The Company considers fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. The Company utilizes the following three-level fair value hierarchy to establish the priorities of the inputs used to measure fair value: •Level 1 — Quoted prices in active markets for identical assets or liabilities. •Level 2 — Observable inputs other than quoted market prices included in Level 1, such as: quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. •Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis, excluding assets related to the Company’s defined benefit pension plans, classified by the level within the fair value hierarchy (in thousands):
Investment Securities The marketable securities for the Company's deferred compensation plan were recorded at a fair value of $20.6 million and $17.7 million, as of September 30, 2018 and March 31, 2018, respectively, based on quoted market prices. Quoted market prices are observable inputs that are classified as Level 1 within the fair value hierarchy. Unrealized trading gains (losses) related to trading securities for the three and six months ended September 30, 2018 and 2017 were not material and are included in other income (expense), net in the Company's condensed consolidated statements of operations. Non-marketable Investments The Company has certain non-marketable investments included in other assets that are accounted for under the equity method of accounting, with carrying value of $5.8 million and $5.1 million as of September 30, 2018 and March 31, 2018, respectively. In addition, the Company has certain investments without readily determinable fair values due to the absence of quoted market prices, the inherent lack of liquidity, and the fact that inputs used to measure fair value are unobservable and require management's judgment. When certain events or circumstances indicate that impairment may exist, the Company revalues the investments using various assumptions, including the financial metrics and ratios of comparable public companies. The carrying value is also adjusted for observable price changes with a same or similar security from the same issuer. The amount of these investments included in other assets as of September 30, 2018 and March 31, 2018 was $7.5 million and $7.3 million, respectively. Assets Measured at Fair Value on a Nonrecurring Basis The Company’s non-financial assets, such as intangible assets and acquisition-related property, plant and equipment, are recorded at fair value only upon initial recognition or if an impairment is recognized. There was no impairment of these assets during the three and six months ended September 30, 2018 or 2017. |
Derivative Financial Instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Financial Instruments | Derivative Financial Instruments Under certain agreements with the respective counterparties to the Company’s derivative contracts, subject to applicable requirements, the Company is allowed to net settle transactions of the same type with a single net amount payable by one party to the other. However, the Company presents its derivative assets and derivative liabilities on a gross basis on the condensed consolidated balance sheets as of September 30, 2018 and March 31, 2018. The fair values of the Company’s derivative instruments were not material as of September 30, 2018 or March 31, 2018. The amount of gain (loss) recognized on derivatives not designated as hedging instruments was not material in all periods presented herein. The following table presents the amounts of gains (losses) on the Company’s derivative instruments designated as hedging instruments and their locations on its condensed consolidated statements of operations and condensed consolidated statements of comprehensive income for the three and six months ended September 30, 2018 and 2017 (in thousands):
Upon adoption of ASU 2017-12, the Company has started presenting the earnings impact from forward points in the same line item that is used to present the earnings impact of the hedged item, i.e. cost of goods sold, for hedging forecasted inventory purchases and such amount is not material for all periods presented. Cash Flow Hedges The Company enters into cash flow hedge contracts to protect against exchange rate exposure of forecasted inventory purchases. These hedging contracts mature within four months. Gains and losses in the fair value of the effective portion of the hedges are deferred as a component of accumulated other comprehensive loss until the hedged inventory purchases are sold, at which time the gains or losses are reclassified to cost of goods sold. Cash flows from such hedges are classified as operating activities in the condensed consolidated statements of cash flows. Hedging relationships are discontinued when hedging contract is no longer eligible for hedge accounting, or is sold, terminated or exercised, or when Company removes hedge designation for the contract. Gains and losses in the fair value of the effective portion of the discontinued hedges continue to be reported in accumulated other comprehensive loss until the hedged inventory purchases are sold, unless it is probable that the forecasted inventory purchases will not occur by the end of the originally specified time period or within an additional two-month period of time thereafter. In all periods presented herein, there have been no forecasted inventory purchases that were probable to not occur by the end of the originally specified time period or within an additional two-month period of time thereafter. The notional amounts of foreign currency exchange forward contracts outstanding related to forecasted inventory purchases were $89.1 million as of September 30, 2018. As of March 31, 2018, there were no currency forward contracts outstanding related to forecasted inventory purchases. The Company had $0.3 million of net gains related to its cash flow hedges included in accumulated other comprehensive loss as of September 30, 2018 which will be reclassified into earnings within the next 12 months. Other Derivatives The Company also enters into foreign currency exchange forward and swap contracts to reduce the short-term effects of currency exchange rate fluctuations on certain receivables or payables denominated in currencies other than the functional currencies of its subsidiaries. These contracts generally mature within one month. The primary risk managed by using forward and swap contracts is the currency exchange rate risk. The gains or losses on these contracts are recognized in other income (expense), net in the condensed consolidated statements of operations based on the changes in fair value. The notional amounts of these contracts outstanding as of September 30, 2018 and March 31, 2018 were $71.5 million and $47.2 million, respectively. Open forward and swap contracts outstanding as of September 30, 2018 and March 31, 2018 consisted of contracts in Mexican Pesos, Japanese Yen, Canadian Dollars, Taiwan New Dollars and Australian Dollars to be settled at future dates at pre-determined exchange rates. The fair value of all foreign currency exchange forward and swap contracts is determined based on observable market transactions of spot currency rates and forward rates. Cash flows from these contracts are classified as operating activities in the condensed consolidated statements of cash flows. |
Goodwill and Other Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The Company conducts its impairment analysis of goodwill annually at December 31 and as necessary, if changes in facts and circumstances indicate that it is more likely than not that the fair value of the Company’s reporting units may be less than its carrying amount. There have been no events or circumstances during the six months ended September 30, 2018 that have required the Company to perform an interim assessment of goodwill. The following table summarizes the activities in the Company’s goodwill balance during the six months ended September 30, 2018 (in thousands):
The Company's acquired intangible assets subject to amortization were as follows (in thousands):
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Financing Arrangements |
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Debt Disclosure [Abstract] | |
Financing Arrangements | Financing Arrangements The Company had several uncommitted, unsecured bank lines of credit aggregating $79.3 million as of September 30, 2018. There are no financial covenants under these lines of credit with which the Company must comply. As of September 30, 2018, the Company had outstanding bank guarantees of $26.3 million under these lines of credit. There was no borrowing outstanding under these lines of credit as of September 30, 2018 or March 31, 2018. |
Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | Commitments and Contingencies Product Warranties All of the Company's products are covered by warranty to be free from defects in material and workmanship for periods ranging from one year to five years. The Company’s warranty doesn’t provide a service beyond assuring that the product complies with agreed-upon specifications and is not sold separately. The warranty the Company provides qualifies as an assurance warranty and is not treated as a separate performance obligation. The Company estimates cost of product warranties at the time the related revenue is recognized based on historical warranty claim rates, historical costs, and knowledge of specific product failures that are outside of the Company's typical experience. The Company accrues a warranty liability for estimated costs to provide products, parts or services to repair or replace products in satisfaction of the warranty obligation. Each quarter, the Company reevaluates estimates to assess the adequacy of recorded warranty liabilities considering the size of the installed base of products subject to warranty protection and adjusts the amounts as necessary. When the Company experiences changes in warranty claim activity or costs associated with fulfilling those claims, the warranty liability is adjusted accordingly. If actual product failure rates or repair costs differ from estimates, revisions to the estimated warranty liabilities would be required and could materially affect the Company's results of operations. Changes in the Company’s warranty liability for the three and six months ended September 30, 2018 and 2017 were as follows (in thousands):
Guarantees Logitech Europe S.A., one of the Company's wholly-owned subsidiaries, guaranteed payments of certain third-party contract manufacturers’ purchase obligations. As of September 30, 2018, the maximum amount of this guarantee was $3.8 million, of which $1.5 million of guaranteed purchase obligations were outstanding. Indemnifications The Company indemnifies certain of its suppliers and customers for losses arising from matters such as intellectual property disputes and product safety defects, subject to certain restrictions. The scope of these indemnities varies, but in some instances, includes indemnification for damages and expenses, including reasonable attorneys’ fees. As of September 30, 2018, no amounts have been accrued for these indemnification provisions. The Company does not believe, based on historical experience and information currently available, that it is probable that any material amounts will be required to be paid under its indemnification arrangements. The Company also indemnifies its current and former directors and certain of its current and former officers. Certain costs incurred for providing such indemnification may be recoverable under various insurance policies. The Company is unable to reasonably estimate the maximum amount that could be payable under these arrangements because these exposures are not limited, the obligations are conditional in nature and the facts and circumstances involved in any situation that might arise are variable. Legal Proceedings From time to time the Company is involved in claims and legal proceedings that arise in the ordinary course of its business. The Company is currently subject to several such claims and a small number of legal proceedings. The Company believes that these matters lack merit and intends to vigorously defend against them. Based on currently available information, the Company does not believe that resolution of pending matters will have a material adverse effect on its financial condition, cash flows or results of operations. However, litigation is subject to inherent uncertainties, and there can be no assurances that the Company’s defenses will be successful or that any such lawsuit or claim would not have a material adverse impact on the Company’s business, financial condition, cash flows or results of operations in a particular period. Any claims or proceedings against the Company, whether meritorious or not, can have an adverse impact because of defense costs, diversion of management and operational resources, negative publicity and other factors. Any failure to obtain a necessary license or other rights, or litigation arising out of intellectual property claims, could adversely affect the Company’s business. |
Shareholders' Equity |
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Stockholders' Equity Note [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' Equity | Shareholders’ Equity Share Repurchase Program In March 2017, the Company's Board of Directors approved the 2017 share buyback program, which authorizes the Company to use up to $250.0 million to purchase up to 17.3 million shares of its own shares. The Company's share buyback program is expected to remain in effect for a period of three years. Shares may be repurchased from time to time on the open market, through block trades or otherwise. Purchases may be started or stopped at any time without prior notice depending on market conditions and other factors. As of September 30, 2018, $200.0 million is still available for repurchase under the 2017 buyback program. Cash Dividend on Shares of Common During the three and six months ended September 30, 2018, the Company declared and paid cash dividends of CHF 0.67 (USD equivalent of $0.69) per common share, totaling $114.0 million on the Company's outstanding common stock. During the three and six months ended September 30, 2017, the Company declared and paid cash dividends of CHF 0.61 (USD equivalent of $0.63) per common share, totaling $104.2 million on the Company's outstanding common stock. Any future dividends will be subject to the approval of the Company's shareholders. Additional Authorized and Conditional Shares The Company has reserved conditional capital of 25,000,000 shares for potential issuance on the exercise of rights granted under the Company's employee equity incentive plans and additional conditional capital for financing purposes, representing the issuance of up to 25,000,000 shares to cover any conversion rights under a future convertible bond issuance. During the 2018 Annual General Meeting, the shareholders of the Company authorized the Board of Directors to issue up to an additional 34,621,324 shares of the Company until September 5, 2020. Accumulated Other Comprehensive Income (Loss) The accumulated other comprehensive income (loss) was as follows (in thousands):
(1) Tax effect was not significant as of September 30 or March 31, 2018. |
Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information The Company has determined that it operates in a single operating segment that encompasses the design, manufacturing and marketing of peripherals for PCs, tablets and other digital platforms. Operating performance measures are provided directly to the Company's CEO, who is considered to be the Company’s Chief Operating Decision Maker. The CEO periodically reviews information such as net sales and adjusted operating income (loss) to make business decisions. These operating performance measures do not include restructuring charges (credits), net, share-based compensation expense, amortization of intangible assets, charges from the purchase accounting effect on inventory, acquisition-related costs, change in fair value of contingent consideration from business acquisition, or gain (loss) from investments in privately held companies. Net sales by product categories and sales channels, excluding intercompany transactions, for the three and six months ended September 30, 2018 and 2017 were as follows (in thousands):
(1) Other category includes products that the Company currently intends to transition out of, or has already transitioned out of, because they are no longer strategic to the Company's business. Net sales by geographic region (based on the customers’ locations) for the three and six months ended September 30, 2018 and 2017 were as follows (in thousands):
Sales are attributed to countries on the basis of the customers’ locations. The United States and Germany each represented more than 10% of the total consolidated net sales for each of the periods presented herein. China represented more than 10% of the total consolidated net sales for the three and six months ended September 30, 2018. No other countries represented 10% or more of the Company’s total consolidated net sales for the periods presented herein. Switzerland, the Company’s home domicile, represented 4% and 3% of the Company's total consolidated net sales for the three and six months ended September 30, 2018, respectively, and 2% for each of the three and six months ended September 30, 2017. Two customer groups of the Company each represented more than 10% of the total consolidated net sales for each of the periods presented herein. Property, plant and equipment, net by geographic region were as follows (in thousands):
Property, plant and equipment, net in the United States and China were $33.5 million and $38.2 million, respectively, as of September 30, 2018, and $35.3 million and $37.9 million, respectively, as of March 31, 2018. No other countries represented more than 10% of the Company’s total consolidated property, plant and equipment, net as of September 30, 2018 or March 31, 2018. Property, plant and equipment, net in Switzerland, the Company’s home domicile, were $1.6 million and $1.9 million as of September 30, 2018 and March 31, 2018, respectively. |
Restructuring |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring | Restructuring During the first quarter of fiscal year 2019, the Company implemented a restructuring plan to streamline and realign the Company's overall organizational structure and reallocate resources to support long-term growth opportunities. In July 2018, the Company's Board of Directors approved to allow additional costs under this restructuring plan, totaling pre-tax charges of approximately $10.0 million to $15.0 million, of which $10.0 million was recognized during the first half of fiscal year 2019. The total charges consisted of cash severance and other personnel costs and are presented as restructuring charges (credit), net in the condensed consolidated statements of operations, and the accrual balances are presented in accrued and other current liabilities in the condensed consolidated balance sheets. The Company expects to substantially complete this restructuring within the next six to nine months. The following table summarizes restructuring related activities during the three and six months ended September 30, 2018 (in thousands):
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Subsequent Event |
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Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event |
The Company and Summary of Significant Accounting Policies and Estimates (Policies) |
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Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The condensed consolidated interim financial statements include the accounts of Logitech and its subsidiaries. All intercompany balances and transactions have been eliminated. The condensed consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and therefore do not include all the information required by GAAP for complete financial statements. They should be read in conjunction with the Company’s audited consolidated financial statements for the fiscal year ended March 31, 2018, included in its Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on May 21, 2018. In the opinion of management, these condensed consolidated financial statements include all adjustments, consisting of only normal and recurring adjustments, necessary and in all material aspects, for a fair statement of the results of operations, comprehensive income, financial position, cash flows and changes in shareholders' equity for the periods presented. Operating results for the three and six months ended September 30, 2018 are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2019, or any future periods. |
Reclassification | Reclassification Certain amounts from the comparative period in the accompanying condensed consolidated financial statements have been reclassified to conform to the condensed consolidated financial statement presentation as of and for the three and six months ended September 30, 2018. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make judgments, estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements. Management bases its estimates on historical experience and various other assumptions believed to be reasonable. Significant estimates and assumptions made by management involve the fair value of goodwill, intangible assets acquired from business acquisitions, warranty liabilities, accruals for customer incentives, cooperative marketing, and pricing programs ("Customer Programs") and related breakage when appropriate, accrued revenue reserve from returns, allowance for doubtful accounts, inventory valuation, contingent consideration from business acquisitions and periodical reassessment of its fair value, share-based compensation expense, uncertain tax positions, and valuation allowances for deferred tax assets. Although these estimates are based on management’s best knowledge of current events and actions that may impact the Company in the future, actual results could differ materially from these estimates. |
Recent Accounting Pronouncements Issued and Adopted | In January 2016, the FASB issued ASU 2016-01, "Financial Instruments-Recognition and Measurement of Financial Assets and Financial Liabilities (Subtopic 825-10)" ("ASU 2016-01"). ASU 2016-01 requires entities to measure equity instruments at fair value and recognize any changes in fair value within the statement of operations. The Company adopted ASU 2016-01 effective April 1, 2018 on a prospective basis for its privately held strategic equity securities without readily determinable fair values. The Company elected the measurement alternative to record these investments at cost and to adjust for impairments and observable price changes with a same or similar security from the same issuer within the statement of operations. The adoption of ASU 2016-01 did not have a material impact on the Company's condensed consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, "Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory" ("ASU 2016-16"), which eliminates the deferral of income tax effects of intra-entity asset transfers until the transferred asset is sold to an unrelated party or recovered through use. However, this standard does not apply to intra-entity transfer of inventory. The Company adopted this standard effective April 1, 2018 on a modified retrospective basis, and the adoption of ASU 2016-16 did not have a material impact on its condensed consolidated financial statements. In December 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash" ("ASU 2016-18"), which requires that a statement of cash flows explains the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. The Company adopted this standard effective April 1, 2018, utilizing the retrospective transition method to each period presented and the adoption of ASU 2016-18 did not have an impact on its condensed consolidated financial statements as the Company did not have restricted cash for either periods presented. In January 2017, the FASB issued ASU 2017-01, "Business Combination (Topic 805): Clarifying the Definition of a Business" ("ASU 2017-01"), which changes the definition of a business to assist with evaluating when a set of transferred assets and activities is a business. The Company adopted this standard effective April 1, 2018, and the adoption of ASU 2017-01 did not have a material impact on its condensed consolidated financial statements. In March 2017, the FASB issued ASU 2017-07, "Compensation-Retirement Benefit (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost" ("ASU 2017-07"), which requires that the Company disaggregate the service cost component from the other components of net benefit cost, and also provides guidance on how to present the service cost component and the other components of net benefit cost in the income statement and allow only the service cost component of net benefit cost to be eligible for capitalization. The Company adopted this standard effective April 1, 2018 using a retrospective adoption method. Other than the revised statement of operations presentation for the periods in the current year, the adoption of ASU 2017-07 did not have an impact on the Company’s condensed consolidated financial statements. The impact to the comparative period was immaterial and therefore the prior period statements of operations was not revised. In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities" ("ASU 2017-12"), which improves the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements and simplifies the application of the hedge accounting guidance. The Company adopted this standard prospectively on April 1, 2018, and the adoption of ASU 2017-12 did not have a material impact on its condensed consolidated financial statements. In accordance with ASU 2017-12, the Company has started presenting the earnings impact from forward points in cost of goods sold line item, which is used to present the earnings impact of the hedged item. Recent Accounting Pronouncements to be Adopted In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)" ("ASU 2016-02" or "Topic 842"), which generally requires companies to recognize right-of-use assets and lease liabilities arising from operating and financing leases with terms longer than 12 months in the consolidated balance sheets. The Company will adopt the new guidance in the first quarter of fiscal year 2020 on a modified retrospective basis, which recognizes the cumulative effect of initially applying Topic 842 as an adjustment to retained earnings at the adoption date. Although the Company expects to record significant amounts of right-of-use assets and liabilities on its condensed consolidated balance sheets, the Company is still evaluating the full impact that ASU 2016-02 will have on its condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurements" ("ASU 2018-13"), which aims to improve the overall usefulness of disclosures to financial statement users and reduce unnecessary costs to companies when preparing fair value measurement disclosures. ASU 2018-13 is effective for annual and interim periods in fiscal years beginning after December 15, 2019. Early adoption is permitted. Retrospective adoption is required, except for certain disclosures which will be required to be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. The Company is evaluating the full effect that ASU 2018-13 will have on its condensed consolidated financial statements and the timing of adoption. In August 2018, the FASB issued ASU 2018-14, "Compensation - Retirement Benefits - Defined Benefits Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans" ("ASU 2018-14"), which aims to improve the overall usefulness of disclosures to financial statement users and reduce unnecessary costs to companies when preparing defined benefit plan disclosures. ASU 2018-14 is effective for annual periods in fiscal years ending after December 15, 2021. Retrospective adoption is required and early adoption is permitted. The Company is evaluating the full effect that ASU 2018-14 will have on its condensed consolidated financial statements and the timing of adoption. In August 2018, the FASB issued ASU 2018-15, "Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract" ("ASU 2018-15"), which clarifies that implementation costs incurred by customers in cloud computing arrangements are deferred if they would be capitalized by customers in software licensing arrangements under the internal-use software guidance. ASU 2018-15 is effective for annual and interim periods in fiscal years beginning after December 15, 2019, with early adoption permitted. Entities have the option to apply the guidance prospectively to all implementation costs incurred after the date of adoption or retrospectively. The Company is evaluating the full effect that ASU 2018-15 will have on its condensed consolidated financial statements and the timing of adoption. Recent Accounting Pronouncements Adopted In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, "Revenue from Contracts with Customers (Topic 606)" ("ASU 2014-09" or “Topic 606”) which supersedes the revenue recognition requirements under ASC 605 (“Topic 605”), Revenue Recognition. ASU 2014-09 outlines a new, single, comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes existing revenue recognition guidance, including industry-specific guidance. Under the new guidance, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard requires reporting companies to disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. On April 1, 2018, the Company adopted the new standard and all related amendments using the modified retrospective method applied to those contracts which were not completed as of April 1, 2018. Results for reporting periods beginning after April 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with historic accounting standards under Topic 605. As result of the adoption of the new standard, the Company recorded: a) a reduction to retained earnings as of April 1, 2018; and b) reclassifications of certain allowances for sales returns and certain other Customer Programs from accounts receivable, net to accrued and other current liabilities and other current assets. |
Revenue Recognition | Revenue Recognition Revenue is recognized when a customer obtains control of promised goods or service in an amount that reflects the transaction price the Company expects to receive in exchange for those goods or services. Substantially all revenue recognized by the Company relates to the contracts with customers to sell products that allow people to connect through music, gaming, video, computing, and other digital platforms. These products are hardware devices, which may include embedded software, and these functions together are considered as one performance obligation. Hardware devices are generally plug and play, requiring no configuration and little or no installation. Revenue is recognized at a point in time when control of the products is transferred to the customer which generally occurs upon shipment. The Company’s contracts with its customers generally have a term of no more than one year. The Company applies the practical expedient of not disclosing the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. The Company also provides post-contract customer support (“PCS”) for products and related software, which includes unspecified software updates and upgrades, bug fixes and maintenance. The transaction price is allocated to two performance obligations in such contracts, based on a relative standalone selling price. The transaction price allocated to PCS is recognized as revenue on a straight-line basis over the estimated term of the support, which is between one to two years, and is not material for the periods presented herein. Deferred revenue associated with remaining PCS performance obligation is not material as of September 30, 2018 and March 31, 2018. The Company normally requires payments from customers within thirty to sixty days from invoice date. However, terms may vary by customer type, by country and by selling season. Extended payment terms are sometimes offered to a limited number of customers during the second and third fiscal quarters. The Company does not modify payment terms on existing receivables. The Company's contracts with customers typically do not include significant financing components as the period between the satisfaction of performance obligations and timing of payment are generally within one year. The transaction price received by the Company from sales to its distributors, retail companies ("retailers"), and authorized resellers is calculated as selling price net of variable consideration which may include product returns, price protection, and the Company’s payments for Customer Programs related to current period product revenue. The estimated impact of these programs is recorded as a reduction of sales or as an operating expense if the Company receives a distinct good or service from the customer and can reasonably estimate the fair value of that good or service received. Significant management judgment and estimates are used to determine the impact of these programs in any accounting period. Certain Customer Programs require management to estimate the percentage of those programs which will not be claimed or will not be earned by customers based on historical experience and on the specific terms and conditions of particular programs. The percentage of these customer programs that will not be claimed or earned is commonly referred to as "breakage". The Company accounts for breakage as part of variable consideration, subject to constraint, and records the estimated impact in the same period when revenue is recognized at the expected value considering constraints. Significant management judgments and estimates are used to determine the breakage of the programs in any accounting period. The Company enters into cooperative marketing arrangements with many of its customers and with certain indirect partners, allowing customers to receive a credit equal to a set percentage of their purchases of the Company's products, or a fixed dollar credit for various marketing and incentive programs. The objective of these arrangements is to encourage advertising and promotional events to increase sales of the Company's products. Customer incentive programs include consumer rebates and performance-based incentives. Consumer rebates are offered to the Company's customers and indirect partners at the Company's discretion for the primary benefit of end-users. In addition, the Company offers performance-based incentives to many of its customers and indirect partners based on predetermined performance criteria. At management's discretion, the Company also offers special pricing discounts to certain customers. Special pricing discounts are usually offered only for limited time periods or for sales of selected products to specific indirect partners. Estimates of required accruals for cooperative marketing arrangements and customer incentive programs are determined based on negotiated terms, consideration of historical experience, forecasted incentives, anticipated volume of future purchases, and inventory levels in the channel. The Company has agreements with certain customers that contain terms allowing price protection credits to be issued in the event of a subsequent price reduction. Management's decision to make price reductions is influenced by product life cycle stage, market acceptance of products, the competitive environment, new product introductions and other factors. Accruals for estimated expected future pricing actions are recognized at the time of sale based on analyses of historical pricing actions by customer and by product, inventories owned by and located at customers, current customer demand, current operating conditions, and other relevant customer and product information, such as stage of product life-cycle. Product return rights vary by customer. Estimates of expected future product returns qualify as variable consideration and are recorded as a reduction of the transaction price of the contract at the time of sale based on analyses of historical return trends by customer and by product, inventories owned by and located at customers, current customer demand, current operating conditions, and other relevant customer and product information. The Company assesses the estimated returned asset value for impairment, and adjusts the value of the asset if it becomes impaired. Return trends are influenced by product life cycle status, new product introductions, market acceptance of products, sales levels, product sell-through, the type of customer, seasonality, product quality issues, competitive pressures, operational policies and procedures, and other factors. Return rates can fluctuate over time but are sufficiently predictable to allow the Company to estimate expected future product returns. Typically, variable consideration does not need to be constrained as estimates are based on predictive historical data or future commitments that are planned and controlled by the Company. However, the Company continues to assess variable consideration estimates such that it is probable that a significant reversal of revenue will not occur. The Company regularly evaluates the adequacy of its estimates for Customer Programs and product returns. Future market conditions and product transitions may require the Company to take action to change such programs and related estimates. When the variables used to estimate these costs change, or if actual costs differ significantly from the estimates, the Company would be required to record incremental increases or reductions to sales or operating expenses. Sales taxes and value added taxes (“VAT”) collected from customers, if applicable, which are remitted to governmental authorities are not included in revenue, and are reflected as a liability on the condensed consolidated balance sheets. The Company has elected to exclude sales taxes from the revenue recognized from contracts with customers. Shipping and Handling Costs The Company's shipping and handling costs are included in cost of goods sold in the condensed consolidated statements of operations for all periods presented. Contract Balances The Company records accounts receivable from contracts with customers when it has an unconditional right to consideration, as accounts receivable, net on the condensed consolidated balance sheet. The Company records contract liabilities when cash payments are received or due in advance of performance, primarily for implied support and subscriptions. Contract liabilities are included in accrual and other current liabilities on the condensed consolidated balance sheets. As of September 30, 2018 and for the period then ended, and as of April 1, 2018, the Company did not have any material contract liabilities balances or changes. Contract Costs The Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that otherwise would have been recognized is one year or less. These costs are included in marketing and selling expenses in the condensed consolidated statements of operations. |
Allowance for Doubtful Accounts | Allowances for Doubtful Accounts Allowances for doubtful accounts are maintained for estimated losses resulting from the Company's customers' inability to make required payments. The allowances are based on the Company's regular assessment of the financial condition of specific customers, as well as its historical experience with bad debts and customer deductions, receivables aging, current economic trends, geographic or country specific risks and the financial condition of its distribution channels. |
The Company and Summary of Significant Accounting Policies and Estimates (Tables) |
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Cumulative Effect of Changes | The following tables summarize the impacts of adopting Topic 606 on the Company’s condensed consolidated statements of operations for the three and six months ended September 30, 2018 and condensed consolidated balance sheet as of September 30, 2018 (in thousands):
The cumulative effect of the changes to the condensed consolidated balance sheet from the adoption of Topic 606 was as follows (in thousands):
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Business Acquisition Business Acquisition (Tables) |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the Acquisition Date (in thousands):
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Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | The following table summarizes the preliminary estimated fair values and estimated useful lives of the components of identifiable intangible assets acquired as of the Acquisition Date (Dollars in thousands):
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Net Income Per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of computations of basic and diluted net income per share | The computations of basic and diluted net income per share for the Company were as follows (in thousands, except per share amounts):
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Employee Benefit Plans (Tables) |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of share-based compensation expense and related tax benefit recognized | The following table summarizes the share-based compensation expense and total income tax benefit recognized for share-based awards for the three and six months ended September 30, 2018 and 2017 (in thousands):
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Balance Sheet Components (Tables) |
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Balance Sheet Related Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of balance sheet asset | (1) Certain allowances for sales return and certain other Customer Programs were included within accounts receivable, net balance as of March 31, 2018. Upon adoption of Topic 606, such balances are presented as accrued revenue reserve from returns and accrued customer marketing, pricing and incentive programs included in accrued and other current liabilities, and as return assets included in other current assets, respectively, on the condensed consolidated balance sheet as of September 30, 2018. Refer to Note 1 to the condensed consolidated financial statements for more information. The following table presents the components of certain balance sheet asset amounts as of September 30 and March 31, 2018 (in thousands):
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Schedule of components of balance sheet liability | The following table presents the components of certain balance sheet liability amounts as of September 30 and March 31, 2018 (in thousands):
(1) Certain allowances for sales return and certain other Customer Programs were included within accounts receivable, net balance as of March 31, 2018. Upon adoption of Topic 606, such balances are presented as accrued revenue reserve from returns and accrued customer marketing, pricing and incentive programs included in accrued and other current liabilities, and as return assets included in other current assets, respectively, on the condensed consolidated balance sheet as of September 30, 2018. Refer to Note 1 to the condensed consolidated financial statements for more information. |
Fair Value Measurements (Tables) |
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Financial Instruments, Owned, at Fair Value [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of financial assets and liabilities accounted for at fair value and classified by level within the fair value hierarchy | The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis, excluding assets related to the Company’s defined benefit pension plans, classified by the level within the fair value hierarchy (in thousands):
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Derivative Financial Instruments (Tables) |
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Schedule of Cash Flow Hedges Included in AOCI | The following table presents the amounts of gains (losses) on the Company’s derivative instruments designated as hedging instruments and their locations on its condensed consolidated statements of operations and condensed consolidated statements of comprehensive income for the three and six months ended September 30, 2018 and 2017 (in thousands):
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Goodwill and Other Intangible Assets (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of activity in the goodwill account | The following table summarizes the activities in the Company’s goodwill balance during the six months ended September 30, 2018 (in thousands):
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Schedule of intangible assets subject to amortization | The Company's acquired intangible assets subject to amortization were as follows (in thousands):
|
Commitments and Contingencies (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of warranty liability | Changes in the Company’s warranty liability for the three and six months ended September 30, 2018 and 2017 were as follows (in thousands):
|
Shareholders' Equity (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of accumulated other comprehensive income (loss) | The accumulated other comprehensive income (loss) was as follows (in thousands):
(1) Tax effect was not significant as of September 30 or March 31, 2018. |
Segment Information (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of net sales by product categories, excluding intercompany transactions | Net sales by product categories and sales channels, excluding intercompany transactions, for the three and six months ended September 30, 2018 and 2017 were as follows (in thousands):
(1) Other category includes products that the Company currently intends to transition out of, or has already transitioned out of, because they are no longer strategic to the Company's business. |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of net sales to unaffiliated customers by geographic region | Net sales by geographic region (based on the customers’ locations) for the three and six months ended September 30, 2018 and 2017 were as follows (in thousands):
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of long-lived assets by geographic region | Property, plant and equipment, net by geographic region were as follows (in thousands):
|
Restructuring (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring Costs | The following table summarizes restructuring related activities during the three and six months ended September 30, 2018 (in thousands):
|
The Company and Summary of Significant Accounting Policies and Estimates - Schedule of Cumulative Effect of Changes (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Apr. 01, 2018 |
Mar. 31, 2018 |
|
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Net sales | $ 691,146 | $ 632,470 | $ 1,299,626 | $ 1,162,416 | ||
Accounts receivable, net | 459,689 | 459,689 | $ 320,653 | $ 214,885 | ||
Other current assets | 70,412 | 70,412 | 62,557 | 56,362 | ||
Accrued and other current liabilities | 434,615 | 434,615 | 404,577 | 281,732 | ||
Retained earnings | 1,210,105 | 1,210,105 | 1,221,434 | 1,232,316 | ||
If Reported Under Topic 605 | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Net sales | 696,090 | 1,304,704 | ||||
Accounts receivable, net | 327,131 | 327,131 | 214,885 | |||
Other current assets | 61,092 | 61,092 | 56,362 | |||
Accrued and other current liabilities | 276,777 | 276,777 | 281,732 | |||
Retained earnings | 1,226,065 | 1,226,065 | $ 1,232,316 | |||
Accounting Standards Update 2014-09 | Effect of Adoption of Topic 606 | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Net sales | (4,944) | (5,078) | ||||
Accounts receivable, net | 132,558 | 132,558 | 105,768 | |||
Other current assets | 9,320 | 9,320 | 6,195 | |||
Accrued and other current liabilities | 157,838 | 157,838 | 122,845 | |||
Retained earnings | $ (15,960) | $ (15,960) | $ (10,882) |
Business Acquisition - Schedule of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Aug. 21, 2018 |
Mar. 31, 2018 |
---|---|---|---|
Business Acquisition [Line Items] | |||
Goodwill | $ 346,548 | $ 275,451 | |
Blue Microphones Holding Corporation | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | $ 1,110 | ||
Accounts receivable | 10,979 | ||
Inventories | 20,206 | ||
Other current assets | 997 | ||
Property, plant and equipment | 1,103 | ||
Intangible assets | 53,267 | ||
Total identifiable assets acquired | 87,662 | ||
Accounts payable | (10,322) | ||
Accrued liabilities | (13,316) | ||
Other long-term liabilities | 271 | ||
Net identifiable assets acquired | 63,753 | ||
Goodwill | 71,116 | ||
Net assets acquired | $ 134,869 |
Business Acquisition - Schedule of Finite-lived Assets Assumed (Details) - Blue Microphones Holding Corporation $ in Thousands |
Aug. 21, 2018
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Preliminary Fair Value | $ 53,267 |
Estimated Useful Life (years) | 7 years 7 months 6 days |
Developed technology | |
Business Acquisition [Line Items] | |
Preliminary Fair Value | $ 17,967 |
Estimated Useful Life (years) | 5 years |
Customer relationships | |
Business Acquisition [Line Items] | |
Preliminary Fair Value | $ 22,800 |
Estimated Useful Life (years) | 10 years |
Trade name | |
Business Acquisition [Line Items] | |
Preliminary Fair Value | $ 12,500 |
Estimated Useful Life (years) | 7 years |
Net Income Per Share - Computation of Basic and Diluted Net Income per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Earnings Per Share [Abstract] | ||||
Net income | $ 64,176 | $ 56,358 | $ 102,642 | $ 93,365 |
Shares used in net income per share computation: | ||||
Weighted average shares outstanding - basic (in shares) | 165,630 | 164,120 | 165,474 | 163,765 |
Effect of potentially dilutive equivalent shares (in shares) | 3,604 | 4,958 | 3,522 | 4,945 |
Weighted average shares outstanding - diluted (in shares) | 169,234 | 169,078 | 168,996 | 168,710 |
Net income per share: | ||||
Basic (in dollars per share) | $ 0.39 | $ 0.34 | $ 0.62 | $ 0.57 |
Diluted (in dollars per share) | $ 0.38 | $ 0.33 | $ 0.61 | $ 0.55 |
Anti-dilutive equivalents shares excluded (in shares) | 800 | 600 | 1,200 | 1,200 |
Employee Benefit Plans - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Share-based Compensation | ||||
Share-based compensation expenses capitalized as inventory | $ 0.8 | $ 0.8 | ||
Defined benefit plans | ||||
Net periodic benefit cost | $ 2.2 | $ 2.3 | $ 4.5 | $ 4.6 |
Income Taxes - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Mar. 31, 2018 |
|
Operating Loss Carryforwards [Line Items] | |||||
Provision for (benefit from) income taxes | $ (6,203) | $ (4,087) | $ (986) | $ 1,349 | |
Effective income tax rates | 8.80% | 6.80% | 1.00% | (1.50%) | |
Excess tax benefit | $ 700 | $ 1,100 | $ 9,000 | $ 11,000 | |
Tax benefit from reversal of uncertain tax position | 500 | $ 700 | 1,400 | $ 1,300 | |
Unrecognized tax benefits | 70,400 | 70,400 | $ 69,100 | ||
Accrued interest and penalties related to uncertain tax positions | 2,500 | 2,500 | 2,300 | ||
Expected decrease in uncertain tax positions | 3,300 | 3,300 | |||
Non-current income tax payable | |||||
Operating Loss Carryforwards [Line Items] | |||||
Unrecognized tax benefits | $ 34,500 | $ 34,500 | $ 35,000 |
Balance Sheet Components - Components of Certain Balance Sheet Liability Amounts (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Apr. 01, 2018 |
Mar. 31, 2018 |
---|---|---|---|
Accrued and other current liabilities: | |||
Accrued personnel expenses | $ 80,554 | $ 82,330 | |
Accrued revenue reserve from returns | 38,359 | 0 | |
Accrued customer marketing, pricing and incentive programs | 173,992 | 71,962 | |
Warranty accrual | 18,470 | 16,279 | |
Employee benefit plan obligation | 2,243 | 1,763 | |
Income taxes payable | 5,741 | 4,354 | |
Other current liabilities | 115,256 | 105,044 | |
Accrued and other current liabilities | 434,615 | $ 404,577 | 281,732 |
Other non-current liabilities: | |||
Warranty accrual | 13,284 | 11,294 | |
Obligation for deferred compensation plan | 20,645 | 17,748 | |
Employee benefit plan obligation | 40,857 | 42,434 | |
Deferred tax liability | 1,980 | 1,980 | |
Other non-current liabilities | 7,642 | 8,468 | |
Non-current liabilities | $ 84,408 | $ 81,924 |
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Mar. 31, 2018 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Trading investments for deferred compensation plan | $ 20,645 | $ 17,748 |
Equity method investments | 5,800 | 5,100 |
Cost method investments | 7,500 | 7,300 |
Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Trading investments for deferred compensation plan | $ 20,645 | $ 17,748 |
Derivative Financial Instruments - Gains and Losses on Derivative Instruments (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Amounts of gains and losses on the derivative instruments | ||||
Amount of Gain (Loss) Deferred as a Component of Accumulated Other Comprehensive Loss | $ 298 | $ (2,140) | $ 485 | $ (5,349) |
Amount of Loss (Gain) Reclassified from Accumulated Other Comprehensive Loss to Costs of Goods Sold | 218 | 2,596 | 3,069 | 3,129 |
Designated as hedging instruments | Cash Flow Hedges | ||||
Amounts of gains and losses on the derivative instruments | ||||
Amount of Gain (Loss) Deferred as a Component of Accumulated Other Comprehensive Loss | 298 | (2,140) | 485 | (5,349) |
Amount of Loss (Gain) Reclassified from Accumulated Other Comprehensive Loss to Costs of Goods Sold | $ 218 | $ 2,596 | $ 3,069 | $ 3,129 |
Derivative Financial Instruments - Narrative (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Mar. 31, 2018 |
|
Derivative [Line Items] | ||
Additional term to recognize derivative loss in Accumulated Other Comprehensive Loss | 2 months | |
Not Designated as Hedging Instrument | Foreign Exchange Forward And Swap | ||
Derivative [Line Items] | ||
Derivative term of contract | 1 month | |
Foreign Exchange Forward | Designated as hedging instruments | Cash Flow Hedges | ||
Derivative [Line Items] | ||
Derivative term of contract | 4 months | |
Notional amount of derivatives | $ 89.1 | |
Cash flow hedge gain to be reclassified within twelve months | (0.3) | |
Foreign Exchange Forward | Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Notional amount of derivatives | $ 71.5 | $ 47.2 |
Goodwill and Other Intangible Assets - Summary of Activity In Goodwill Balance (Details) $ in Thousands |
6 Months Ended |
---|---|
Sep. 30, 2018
USD ($)
| |
Goodwill | |
Balance at the beginning of the period | $ 275,451 |
Acquisition (Note 2) | 71,116 |
Currency translation | (19) |
Balance at the end of the period | $ 346,548 |
Goodwill and Other Intangible Assets - Schedule of Intangible Assets Subject to Amortization (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Mar. 31, 2018 |
---|---|---|
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 213,887 | $ 160,555 |
Accumulated Amortization | (83,349) | (73,008) |
Net Carrying Amount | 130,538 | 87,547 |
Trademark and trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 36,370 | 23,870 |
Accumulated Amortization | (11,199) | (9,482) |
Net Carrying Amount | 25,171 | 14,388 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 95,207 | 77,175 |
Accumulated Amortization | (55,722) | (50,755) |
Net Carrying Amount | 39,485 | 26,420 |
Customer contracts/relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 82,310 | 59,510 |
Accumulated Amortization | (16,428) | (12,771) |
Net Carrying Amount | $ 65,882 | $ 46,739 |
Financing Arrangements - Narrative (Details) - USD ($) |
Sep. 30, 2018 |
Mar. 31, 2018 |
---|---|---|
Financing Arrangements | ||
Outstanding borrowings | $ 0 | $ 0 |
Line of Credit | ||
Financing Arrangements | ||
Maximum borrowing capacity | 79,310,690 | |
Outstanding bank guarantees | $ 26,300,000 |
Commitments and Contingencies - Narrative (Details) |
6 Months Ended |
---|---|
Sep. 30, 2018
USD ($)
| |
Parent guarantee for purchase obligation of third party contract manufacturer | |
Other Commitments [Line Items] | |
Maximum amount of the guarantees | $ 3,800,000 |
Guarantees outstanding | 1,500,000 |
Indemnification agreement | |
Other Commitments [Line Items] | |
Amount accrued for indemnification provisions | $ 0 |
Minimum | |
Other Commitments [Line Items] | |
Product warranty term | 1 year |
Maximum | |
Other Commitments [Line Items] | |
Product warranty term | 5 years |
Commitments and Contingencies - Changes in Warranty Liability (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Changes in the warranty liability: | ||||
Beginning of the period | $ 28,853 | $ 22,056 | $ 27,573 | $ 21,911 |
Assumed from business acquisition | 351 | 1,230 | 351 | 1,230 |
Provision | 11,020 | 5,414 | 19,320 | 9,715 |
Settlements | (8,330) | (4,611) | (14,882) | (9,179) |
Currency translation | (140) | 260 | (608) | 672 |
End of the period | $ 31,754 | $ 24,349 | $ 31,754 | $ 24,349 |
Shareholders' Equity - Narrative (Details) |
1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2017
USD ($)
shares
|
Sep. 30, 2018
USD ($)
SFr / shares
shares
|
Sep. 30, 2018
USD ($)
$ / shares
shares
|
Sep. 30, 2017
SFr / shares
|
Sep. 30, 2017
USD ($)
$ / shares
|
Sep. 30, 2018
USD ($)
SFr / shares
shares
|
Sep. 30, 2018
USD ($)
$ / shares
shares
|
Sep. 30, 2017
SFr / shares
|
Sep. 30, 2017
USD ($)
$ / shares
|
Mar. 31, 2018
shares
|
|
Stockholders' Equity Note [Abstract] | ||||||||||
Authorized amount in buyback program | $ | $ 250,000,000.0 | |||||||||
Shares authorized to be repurchased (in shares) | 17,300,000.0 | |||||||||
Period to complete share repurchase program | 3 years | |||||||||
Remaining authorized shares amount | $ | $ 200,000,000 | $ 200,000,000 | $ 200,000,000 | $ 200,000,000 | ||||||
Cash dividend per share (in dollars per share) | (per share) | $ 0.67 | $ 0.69 | SFr 0.61 | $ 0.63 | $ 0.67 | $ 0.69 | SFr 0.61 | $ 0.63 | ||
Cash dividend declared (in dollars per share) | (per share) | $ 0.67 | $ 0.69 | SFr 0.61 | $ 0.63 | $ 0.67 | $ 0.69 | SFr 0.61 | $ 0.63 | ||
Payment of cash dividends | $ | $ 114,000,000 | $ 104,200,000 | $ 113,971,000 | $ 104,248,000 | ||||||
Conditional capital reserve (in shares) | 25,000,000 | |||||||||
Conditional capital reserve to cover convertible debt conversion (in shares) | 25,000,000 | |||||||||
Authorized issuable new registered shares (in shares) | 34,621,324 | 34,621,324 | 34,621,324 | 34,621,324 | 0 |
Segment Information - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Mar. 31, 2018 |
|
Segment Reporting Information [Line Items] | |||||
Long lived assets | $ 83,731 | $ 83,731 | $ 86,304 | ||
Switzerland | |||||
Segment Reporting Information [Line Items] | |||||
Long lived assets | 1,600 | 1,600 | 1,900 | ||
United States | |||||
Segment Reporting Information [Line Items] | |||||
Long lived assets | 33,500 | 33,500 | 35,300 | ||
China | |||||
Segment Reporting Information [Line Items] | |||||
Long lived assets | $ 38,200 | $ 38,200 | $ 37,900 | ||
Geographic Concentration | Consolidated net sales from continuing operations | Switzerland | |||||
Segment Reporting Information [Line Items] | |||||
Percentage of consolidated net sales | 4.00% | 2.00% | 3.00% | 2.00% |
Restructuring - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 30, 2018 |
Jun. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Jul. 31, 2018 |
|
Restructuring Cost and Reserve [Line Items] | ||||||
Charges | $ 119 | $ (61) | $ 10,040 | $ (116) | ||
Termination Benefits | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Charges | $ 9,921 | $ 119 | $ 10,000 | |||
Minimum | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Approved cost of restructuring | $ 10,000 | |||||
Expected completion of restructuring | 6 months | |||||
Maximum | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Approved cost of restructuring | $ 15,000 | |||||
Expected completion of restructuring | 9 months |
Restructuring - Schedule of Restructuring Costs (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2018 |
Jun. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Restructuring Reserve [Roll Forward] | |||||
Charges | $ 119 | $ (61) | $ 10,040 | $ (116) | |
Termination Benefits | |||||
Restructuring Reserve [Roll Forward] | |||||
Accrual beginning balance | 7,907 | $ 0 | 0 | ||
Charges | 9,921 | 119 | 10,000 | ||
Cash payments | (2,014) | $ (1,945) | |||
Accrual ending balance | $ 6,081 | $ 7,907 | $ 6,081 |
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