Balance Sheet Components

12 Months Ended

Oct. 03, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Balance Sheet Components

Balance Sheet Components

The following tables show the Company’s balance sheet component details as of October 3, 2020 and September 28, 2019.

Accounts Receivable Allowances

The following table summarizes changes in the allowance for doubtful accounts for fiscal 2020, 2019 and 2018:

	October 3, 2020		September 28, 2019		September 29, 2018
(In thousands)
Beginning balance	$	1,255	$	872	$	804
Increases	1,127		1,034		635
Write-offs	(1,075)		(651)		(567)
Ending balance	$	1,307	$	1,255	$	872

The following table summarizes the changes in the allowance for sales incentives for fiscal 2020, 2019 and 2018:

	October 3, 2020		September 28, 2019		September 29, 2018
(In thousands)
Beginning balance	$	20,051	$	11,754	$	11,195
Charged to revenue	108,843		87,703		90,246
Utilization of sales incentive allowance	(111,379)		(79,406)		(89,687)
Ending balance	$	17,515	$	20,051	$	11,754

Inventories

Inventories, net, consist of the following:

	October 3, 2020		September 28, 2019
(In thousands)
Finished goods	$	172,184	$	207,723
Components	8,646		12,061
Inventories	$	180,830	$	219,784

Property and Equipment, Net

Property and equipment, net consist of the following:

	October 3, 2020		September 28, 2019
(In thousands)
Computer hardware and software	$	45,798	$	47,775
Furniture and fixtures	8,239		9,594
Tooling and production line test equipment	67,495		54,536
Leasehold improvements	51,102		58,944
Product displays	48,925		45,672
Total property and equipment	221,559		216,521
Accumulated depreciation and amortization	(160,775)		(138,382)
Property and equipment, net	$	60,784	$	78,139

Depreciation expense was $34.9 million, $36.4 million and $39.4 million for fiscal 2020, 2019 and 2018, respectively. During fiscal 2020, 2019 and 2018, the Company abandoned and disposed of gross fixed assets of $18.5 million, $10.2 million and $35.8 million, with accumulated depreciation of $14.2 million, $9.3 million and $35.6 million, respectively. Disposals of fixed assets were recorded in operating expenses in the consolidated statements of operations and comprehensive loss and resulted in losses of $4.3 million, $0.8 million and $0.2 million for fiscal 2020, 2019 and 2018, respectively. For further detail regarding the property and equipment that was abandoned as part of the 2020 restructuring plan, refer to Note 15. Restructuring Plan.

Goodwill

The following table presents details of the Company's goodwill for the year ended October 3, 2020:

	Goodwill
(In thousands)
Balance as of September 28, 2019	$	1,005
Goodwill acquired	14,282
Purchase price adjustment	258
Balance as of October 3, 2020	$	15,545

Intangible Assets

The following table reflects the changes in the net carrying amount of the components of intangible assets associated with the Company's acquisition activity:

	October 3, 2020
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Value		Weighted-Average Remaining Life
(In thousands, except weighted-average remaining life)
Technology	$	7,780	(1,509)		$	6,271	3.55
Other	39		(16)		23		1.17
Total finite-lived intangible assets	7,819		(1,525)		6,294		3.54
In-process research and development and other intangible assets not subject to amortization	20,100		—		20,100
Total intangible assets	$	27,919	$	(1,525)	$	26,394

The following table summarizes the estimated future amortization expense of the Company's intangible assets as October 3, 2020:

Fiscal years ending	Future Amortization Expense
(In thousands)
2021	$	1,938
2022	1,922
2023	1,245
2024	1,020
2025 and thereafter	169
Total future amortization expense	$	6,294

Accrued Expenses

Accrued expenses consisted of the following:

	October 3, 2020		September 28, 2019
(In thousands)
Accrued advertising and marketing	$	10,609	$	25,662
Accrued taxes	6,252		4,388
Accrued inventory	2,843		6,494
Accrued manufacturing, logistics and product development	9,753		14,783
Accrued general and administrative	10,068		12,455
Accrued restructuring	1,062		—
Other accrued payables	4,462		6,074
Total accrued expenses	$	45,049	$	69,856

Deferred revenue

The following table presents the changes in the Company's deferred revenue balances:

	October 3, 2020		September 28, 2019		September 29, 2018
(In thousands)
Deferred revenue, beginning of period	$	56,449	$	50,967	$	45,567
Recognition of revenue included in beginning of period    deferred revenue	(13,052)		(11,934)		(10,627)
Revenue deferred, net of revenue recognized on contracts in the respective period	18,992		17,416		16,027
Deferred revenue, end of period	$	62,389	$	56,449	$	50,967

The Company expects the following recognition of deferred revenue as of October 3, 2020:

	For the fiscal years ending
(In thousands)	2021		2022		2023		2024		2025 and Beyond		Total
Revenue expected to be recognized	$	15,304	$	13,264	$	11,337	$	9,286	$	13,198	$	62,389

Other Current Liabilities

Other current liabilities consist of the following:

	October 3, 2020		September 28, 2019
(In thousands)
Reserve for returns	$	14,195	$	12,110
Short-term operating lease liabilities	10,910		—
Product warranty liability	3,628		3,254
Other	2,417		2,184
Total other current liabilities	$	31,150	$	17,548

The following table presents the changes in the Company’s warranty liability for the fiscal years ended October 3, 2020 and September 28, 2019:

	October 3, 2020		September 28, 2019
(In thousands)
Warranty liability, beginning of period	$	3,254	$	2,450
Provision for warranties issued during the period	12,711		12,795
Settlements of warranty claims during the period	(12,337)		(11,991)
Warranty liability, end of period	$	3,628	$	3,254