abmd-10q_20191231.htm

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of January 30, 2020, 45,062,665 shares of the registrant’s common stock, $.01 par value, were outstanding.

Throughout this quarterly report on Form 10-Q (the “Report”), we refer to various trademarks, service marks and trade names that we use in our business. Abiomed, Impella, Impella 2.5, Impella 5.0, Impella LD, Impella CP, Impella RP, Impella 5.5, Impella Connect, and SmartAssist are registered trademarks of Abiomed, Inc., and are registered in the U.S. and certain foreign countries. Impella BTR, Impella ECP, CVAD Study, and Automated Impella Controller are pending trademarks of Abiomed, Inc. Other trademarks and service marks appearing in this Report are the property of their respective holders.

Throughout this Report, “ABIOMED, Inc.,” the “Company,” “we,” “us” and “our” refer to ABIOMED, Inc. and its consolidated subsidiaries.

We make available, free of charge on our website located at www.abiomed.com, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports, as soon as reasonably practicable after filing such reports with or furnishing such reports to the U.S. Securities and Exchange Commission (the “SEC”). We also use our website for the distribution of Company information. The information we post on our website may be deemed to be material information. Accordingly, investors should monitor our website, in addition to following our press releases, SEC filings and public conference calls and webcasts. The contents of our website are not incorporated by reference into this Report.

	December 31, 2019			March 31, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	117,970		$	121,021
Short-term marketable securities		309,569			370,677
Accounts receivable, net		100,994			90,809
Inventories		91,193			80,942
Prepaid expenses and other current assets		16,850			13,748
Total current assets		636,576			677,197
Long-term marketable securities		167,981			21,718
Property and equipment, net		162,060			145,005
Goodwill		32,594			32,601
In-process research and development		15,205			15,208
Long-term deferred tax assets, net		47,028			77,502
Other assets		135,167			85,115
Total assets	$	1,196,611		$	1,054,346
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	31,566		$	32,185
Accrued expenses		71,876			57,420
Deferred revenue		19,156			16,393
Other current liabilities		3,661			—
Total current liabilities		126,259			105,998
Contingent consideration		10,440			9,575
Long-term deferred tax liabilities		822			822
Other long-term liabilities		12,227			1,061
Total liabilities		149,748			117,456
Commitments and contingencies (Note 13)
Stockholders' equity:
Class B Preferred Stock, $.01 par value		—			—
Authorized - 1,000,000 shares; Issued and outstanding - none
Common stock, $.01 par value		451			451
Authorized - 100,000,000 shares; Issued - 47,498,385 shares at December 31, 2019 and 47,026,226 shares at March 31, 2019
Outstanding - 45,112,835 shares at December 31, 2019 and 45,122,985 shares at March 31, 2019
Additional paid in capital		733,054			690,507
Retained earnings		570,683			399,473
Treasury stock at cost - 2,385,550 shares at December 31, 2019 and 1,903,241 shares at March 31, 2019		(240,330	)		(138,852	)
Accumulated other comprehensive loss		(16,995	)		(14,689	)
Total stockholders' equity		1,046,863			936,890
Total liabilities and stockholders' equity	$	1,196,611		$	1,054,346

The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited)

	For the Three Months Ended December 31,					For the Nine Months Ended December 31,
	2019		2018			2019		2018
Revenue	$	221,584	$	200,563		$	634,225	$	562,351
Costs and expenses:
Cost of revenue		39,996		34,023			111,937		94,718
Research and development		25,655		23,965			73,413		67,955
Selling, general and administrative		85,674		80,220			257,708		240,254
		151,325		138,208			443,058		402,927
Income from operations		70,259		62,355			191,167		159,424
Other income (expenses):
Investment income, net		3,086		2,175			9,066		5,397
Other income (expense), net		23,671		(20	)		17,279		10
		26,757		2,155			26,345		5,407
Income before income taxes		97,016		64,510			217,512		164,831
Income tax provision (benefit)		27,799		19,648			46,301		(20,225	)
Net income	$	69,217	$	44,862		$	171,211	$	185,056

Basic net income per share	$	1.53	$	1.00		$	3.79	$	4.13
Basic weighted average shares outstanding		45,140		45,046			45,225		44,852

Diluted net income per share	$	1.51	$	0.97		$	3.73	$	4.01
Diluted weighted average shares outstanding		45,695		46,136			45,935		46,147

The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited)

	Common Stock						Treasury Stock					Additional Paid			Retained		Accumulated Other			Total Stockholders'
	Shares			Par value			Shares		Amount			in Capital			Earnings		Comprehensive Loss			Equity
Balance, April 1, 2019		45,122,985		$	451			1,903,241	$	(138,852	)	$	690,507		$	399,473	$	(14,689	)	$	936,890
Restricted stock units issued		373,430			4			—		—			(4	)		—		—			—
Stock options exercised		36,289			1			—		—			1,260			—		—			1,261
Return of common stock to pay withholding taxes on restricted stock		(158,426	)		(2	)		158,426		(40,534	)		—			—		—			(40,536	)
Stock compensation expense		—			—			—		—			13,121			—		—			13,121
Other comprehensive income		—			—			—		—			—			—		2,934			2,934
Net income		—			—			—		—			—			88,923		—			88,923
Balance, June 30, 2019		45,374,278		$	454			2,061,667	$	(179,386	)	$	704,884		$	488,396	$	(11,755	)	$	1,002,593
Restricted stock units issued		12,039			—			—		—			—			—		—			—
Stock options exercised		21,268			—			—		—			1,445			—		—			1,445
Return of common stock to pay withholding taxes on restricted stock		(3,363	)		—			3,363		(668	)		—			—		—			(668	)
Stock issued under employee stock purchase plan		15,659			—			—		—			2,368			—		—			2,368
Stock compensation expense		—			—			—		—			13,323			—		—			13,323
Stock repurchase program		(180,929	)		(2	)		180,929		(34,872	)		—			—		—			(34,874	)
Other comprehensive loss		—			—			—		—			—			—		(5,801	)		(5,801	)
Net income		—			—			—		—			—			13,071		—			13,071
Balance, September 30, 2019		45,238,952		$	452			2,245,959	$	(214,926	)	$	722,020		$	501,467	$	(17,556	)	$	991,457
Restricted stock units issued		6,004			—			—		—			—			—		—			—
Stock options exercised		7,470			—			—		—			460			—		—			460
Return of common stock to pay withholding taxes on restricted stock		(2,159	)		—			2,159		(403	)		—			—		—			(403	)
Stock compensation expense		—			—			—		—			10,574			—		—			10,574
Stock repurchase program		(137,432	)		(1	)		137,432		(25,001	)		—			—		—			(25,002	)
Other comprehensive income		—			—			—		—			—			—		561			561
Net income		—			—			—		—			—			69,217		—			69,217
Balance, December 31, 2019		45,112,835		$	451			2,385,550	$	(240,330	)	$	733,054		$	570,683	$	(16,995	)	$	1,046,863

	Common Stock						Treasury Stock					Additional Paid			Retained		Accumulated Other			Total Stockholders'
	Shares			Par value			Shares		Amount			in Capital			Earnings		Comprehensive Loss			Equity
Balance, April 1, 2018		44,375,337		$	444			1,725,312	$	(67,078	)	$	619,905		$	140,457	$	(4,204	)	$	689,524
Restricted stock units issued		384,887			4			—		—			(4	)		—		—			—
Stock options exercised		282,368			3			—		—			5,795			—		—			5,798
Stock issued to directors		80			—			—		—			33			—		—			33
Return of common stock to pay withholding taxes on restricted stock		(166,401	)		(2	)		166,401		(67,596	)		—			—		—			(67,598	)
Stock compensation expense		—			—			—		—			12,245			—		—			12,245
Other comprehensive loss		—			—			—		—			—			—		(6,709	)		(6,709	)
Net income		—			—			—		—			—			90,066		—			90,066
Balance, June 30, 2018		44,876,271		$	449			1,891,713	$	(134,674	)	$	637,974		$	230,523	$	(10,913	)	$	723,359
Restricted stock units issued		18,827			—			—		—			—			—		—			—
Stock options exercised		142,978			1			—		—			4,814			—		—			4,815
Stock issued to directors		74			—			—		—			34			—		—			34
Return of common stock to pay withholding taxes on restricted stock		(5,258	)		—			5,258		(2,069	)		—			—		—			(2,069	)
Stock issued under employee stock purchase plan		5,561			—			—		—			1,376			—		—			1,376
Stock compensation expense		—			—			—		—			15,934			—		—			15,934
Other comprehensive loss		—			—			—		—			—			—		(622	)		(622	)
Net income		—			—			—		—			—			50,127		—			50,127
Balance, September 30, 2018		45,038,453		$	450			1,896,971	$	(136,743	)	$	660,132		$	280,650	$	(11,535	)	$	792,954
Restricted stock units issued		14,085			1			—		—			(1	)		—		—			—
Stock options exercised		10,039			—			—		—			429			—		—			429
Stock issued to directors		103			—			—		—			33			—		—			33
Return of common stock to pay withholding taxes on restricted stock		(4,633	)		—			4,633		(1,546	)		—			—		—			(1,546	)
Stock issued under employee stock purchase plan		2			—			—		—			—			—		—			—
Stock compensation expense		—			—			—		—			15,578			—		—			15,578
Other comprehensive loss		—			—			—		—			—			—		(781	)		(781	)
Net income		—			—			—		—			—			44,862		—			44,862
Balance, December 31, 2018		45,058,049		$	451			1,901,604	$	(138,289	)	$	676,171		$	325,513	$	(12,316	)	$	851,530

The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited)

	For the Nine Months Ended December 31,
	2019			2018
Operating activities:
Net income	$	171,211		$	185,056
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		14,427			9,936
Bad debt expense		241			578
Stock-based compensation		37,019			43,757
Write-down of inventory and other		3,984			3,152
Accretion on marketable securities		(2,678	)		(1,644	)
Change in fair value of other investments		(17,407	)		—
Deferred tax provision		30,551			(25,992	)
Change in fair value of contingent consideration		865			93
Other non-cash operating activities		3,167			—
Changes in assets and liabilities:
Accounts receivable		(10,333	)		(19,268	)
Inventories		(13,261	)		(26,522	)
Prepaid expenses and other assets		(4,250	)		678
Accounts payable		841			4,909
Accrued expenses and other liabilities		11,193			6,909
Deferred revenue		2,757			164
Net cash provided by operating activities		228,327			181,806
Investing activities:
Purchases of marketable securities		(491,513	)		(241,745	)
Proceeds from the sale and maturity of marketable securities and other		410,456			226,949
Purchases of other investments and intangible assets		(20,899	)		(30,436	)
Purchases of property and equipment		(33,460	)		(35,469	)
Net cash used for investing activities		(135,416	)		(80,701	)
Financing activities:
Proceeds from the exercise of stock options		3,165			11,043
Taxes paid related to net share settlement upon vesting of stock awards		(41,607	)		(71,213	)
Repurchase of common stock		(59,876	)		—
Proceeds from the issuance of stock under employee stock purchase plan		2,368			1,376
Net cash used for financing activities		(95,950	)		(58,794	)
Effect of exchange rate changes on cash		(12	)		(1,105	)
Net (decrease) increase in cash and cash equivalents		(3,051	)		41,206
Cash and cash equivalents at beginning of period		121,021			42,975
Cash and cash equivalents at end of period	$	117,970		$	84,181

Supplemental disclosure of cash flow information:
Cash paid for income taxes	$	7,479		$	4,500
Supplemental disclosure of non-cash activities:
Property and equipment in accounts payable and accrued expenses		3,314			1,670
Right-of-use assets obtained in exchange for lease liabilities		14,596			—

The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited)

This Report, including the documents incorporated by reference in this Report, includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, may be forward-looking statements. These forward-looking statements may be accompanied by such words as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “potential,” “project,” “target,” “should,” “likely,” “will” and other words and terms of similar meaning. Each forward-looking statement in this Report is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statement. Factors that could cause actual results or conditions to differ from those anticipated by these and other forward-looking statements include: our dependence on Impella® products for all of our revenues; our ability to successfully compete against our existing or potential competitors; the acceptance of our products by cardiac surgeons and interventional cardiologists, especially those with significant influence over medical device selection and purchasing decisions; long sales and training cycles associated with expansion into new hospital cardiac centers; reduced market acceptance of our products due to lengthy clinician training process; our ability to effectively manage our growth; our ability to successfully commercialize our products; our ability to obtain regulatory approvals and market and sell our products in certain jurisdictions; enforcement actions and product liability suits relating to off-label uses of our products; unsuccessful clinical trials or procedures relating to products under development; our ability to maintain compliance with regulatory requirements; mandatory or voluntary product recalls; shutdowns of the U.S. federal government; third-party payers’ failure to provide reimbursement of our products; changes in healthcare reimbursement systems in the U.S. and other foreign jurisdictions; our failure to comply with healthcare “fraud and abuse” laws; our failure to comply with the U.S. Foreign Corrupt Practices Act and other anti-corruption laws, export control laws, import and customs laws, trade and economic sanctions laws and other laws governing our operations; uncertainties associated with our product development efforts; our ability to increase manufacturing capacity to support continued demand for our products; our or our vendors’ failure to achieve and maintain high manufacturing standards; our ability to attract and retain key personnel; our suppliers’ failure to provide the components we require; our ability to expand our direct sales activities into international markets; the economic effects of “Brexit”; poor performance of our distributors in the international markets; our ability to sustain profitability; our potential “ownership change” for U.S. federal income tax purposes and our limited utilization of net operating losses from prior tax years; impact of changes in tax laws, including recently enacted U.S. Tax Reform; our ability to develop and commercialize new products or acquire desirable companies, products or technologies; our failure to protect our intellectual property or develop or acquire additional intellectual property; increased risk of material product liability claims; inventory write-downs and other costs due to product quality problems; liabilities due to failure to protect the confidentiality of patient health information; disruptions of critical information systems or material breaches in the security of our systems; risks and liabilities associated with acquisitions of other companies or businesses; changes in accounting standards, tax laws and financial reporting requirements; changes in methods, estimates and judgments we use in applying our accounting policies; liabilities, expenses and restrictions associated with environmental and health safety laws; fluctuations in foreign currency exchange rates; the outcome of ongoing securities class action litigation relating to our public disclosures and other factors discussed in Part I, Item 1A. Risk Factors of our Form 10-K for the year ended March 31, 2019 and the filings subsequently filed with or furnished to the SEC. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this Report. Unless otherwise required by law, the company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances that occur after the date of this Report or to reflect the occurrence of unanticipated events.

We are a leading provider of temporary mechanical circulatory support devices, and we offer a continuum of care to heart failure patients. We develop, manufacture and market proprietary products that are designed to enable the heart to rest, heal and recover by improving blood flow to the coronary arteries and end-organs and/or temporarily assisting the pumping function of the heart. Our products are used in the cardiac catheterization lab, or cath lab, by interventional cardiologists, the electrophysiology lab, the hybrid lab and in the heart surgery suite by cardiac surgeons. A physician may use our devices for patients who are in need of hemodynamic support prophylactically, urgently or emergently before, during or after angioplasty or heart surgery procedures. We believe that heart recovery is the optimal clinical outcome for a patient experiencing heart failure because it enhances the potential for the patient to go home with their own heart, facilitating the restoration of quality of life. In addition, we believe that, for the care of such patients, heart recovery is often the most cost-effective solution for the healthcare system.

Our strategic focus and the driver of our revenue growth is the market penetration of our family of Impella® heart pumps. The Impella device portfolio, which includes the Impella 2.5®, Impella CP®, Impella 5.0®, Impella LD®, Impella 5.5® and Impella RP® devices has supported numerous patients worldwide. We expect that all of our product and service revenue in the near future will be from our Impella devices.

Our Impella 2.5, Impella CP, Impella 5.0, Impella LD, Impella 5.5 and Impella RP devices have U.S Food and Drug Administration (“FDA”) and CE Mark which allows us to market these devices in the U.S. and European Union. We expect to continue to make additional PMA supplement submissions for our Impella portfolio of devices for additional indications.

Our Impella 2.5 and Impella 5.0 devices have regulatory approval from the Ministry Health Labour and Welfare (“MHLW”), in Japan. In March 2019, we received Pharmaceuticals and Medical Devices Agency (“PMDA”) approval from MHLW for our Impella CP heart pump in Japan. We began to sell the Impella CP heart pump as an additional product offering in Japan in the quarter ending September 30, 2019.

The Impella 2.5 device is a percutaneous micro heart pump with an integrated motor and sensors. The device is designed primarily for use by interventional cardiologists to support patients in the cath lab who may require assistance to maintain circulation. The Impella 2.5 heart pump can be quickly inserted via the femoral artery to reach the left ventricle of the heart, where it is directly deployed to draw blood out of the ventricle and deliver it to the circulatory system. This function is intended to reduce ventricular work and provide blood flow to vital organs. The Impella 2.5 heart pump is introduced with normal interventional cardiology procedures and can pump up to 2.5 liters of blood per minute.

In March 2015, we received a PMA from the FDA for the use of the Impella 2.5 device during elective and urgent high-risk percutaneous coronary intervention, or PCI, procedures. With this PMA, the Impella 2.5 device became the first FDA approved hemodynamic support device for use during high-risk PCI procedures. Under this PMA, the Impella 2.5 is a temporary (up to six hours) ventricular support device indicated for use during high-risk PCI performed in elective or urgent hemodynamically stable patients with severe coronary artery disease and depressed left ventricular ejection fraction, when a heart team, including a cardiac surgeon, has determined high-risk PCI is the appropriate therapeutic option. Use of the Impella 2.5 device in these patients may prevent hemodynamic instability that may occur during planned temporary coronary occlusions and may reduce periprocedural and post-procedural adverse events. The product labeling allows for the clinical decision by physicians to leave the Impella 2.5 device in place beyond the intended duration of up to six hours should unforeseen circumstances arise.

In April 2016, the FDA approved a PMA supplement for certain of our devices, including our Impella 2.5 device, to provide treatment for ongoing cardiogenic shock. This PMA supplement covers a set of indications related to the use of the Impella devices in patients suffering cardiogenic shock following acute myocardial infarction, or cardiac surgery, and allows for a longer duration of support. The Impella 2.5 catheter, in conjunction with the Automated Impella Controller, or AIC, was approved as a temporary ventricular support device intended for short term use (≤ 4 days) and indicated for the treatment of ongoing cardiogenic shock that occurs immediately (< 48 hours) following acute myocardial infarction as a result of isolated left ventricular failure that is not responsive to optimal medical management and conventional treatment measures. The intent of the Impella system therapy is to reduce ventricular work and to provide the circulatory support necessary to allow heart recovery and early assessment of residual myocardial function. Optimal medical management and convention treatment measures include volume loading and use of pressors and inotropes, with or without an intra-aortic balloon pump, or IABP.

In September 2016, we received Pharmaceuticals and Medical Device Agency, or PMDA, approval from the Japanese Ministry of Health, Labour & Welfare, or MHLW, for our Impella 2.5 heart pump to provide treatment of drug-resistant acute heart failure in Japan. In July 2017, we received approval from the MHLW for reimbursement of the Impella 2.5 heart pump. Reimbursement in Japan for the Impella 2.5 is equivalent to our average Impella sales price in the U.S.

In February 2018, we received two expanded PMAs from the FDA for certain of our Impella heart pumps. The first expanded PMA includes the Impella 2.5 heart pump for use on patients with cardiogenic shock associated with cardiomyopathy, including peripartum and postpartum cardiomyopathy. The second expanded PMA includes the Impella 2.5 heart pump for use during elective and high-risk PCI procedures. This expanded PMA confirms Impella support as appropriate in patients with severe coronary artery disease, complex anatomy and extensive comorbidities, with or without depressed ejection fraction.

In September 2019, the Company announced the results of PROTECT III, the ongoing, prospective, single-arm FDA post-approval study for the PMA approval of Impella 2.5 and Impella CP in high-risk PCI. PROTECT III follows the PROTECT II randomized controlled trial. The findings of this interim analysis on 898 patients demonstrates a reduction in the primary endpoint of death, stroke, myocardial infarction and repeat procedures at 90 days with Impella-supported Protected PCI, compared to PROTECT II.

The Impella 2.5 device has CE Mark approval in the European Union for up to five days of use and is approved for use in up to 40 countries. The Impella 2.5 device also has Health Canada approval which allows us to market the device in Canada.

The Impella CP device provides blood flow of approximately one liter more per minute than the Impella 2.5 device and is primarily used by either interventional cardiologists to support patients in the cath lab or by cardiac surgeons in the heart surgery suite.

In April 2016, the FDA approved a PMA supplement for certain of our devices, including our Impella CP device, to provide treatment for ongoing cardiogenic shock. This PMA supplement covers a set of indications related to the use of the Impella devices in patients suffering cardiogenic shock following acute myocardial infarction, or cardiac surgery, and allows for a longer duration of support. The Impella CP catheter, in conjunction with the AIC, was approved as a temporary ventricular support device intended for short term use (≤ 4 days) and indicated for the treatment of ongoing cardiogenic shock that occurs immediately (< 48 hours) following acute myocardial infarction as a result of isolated left ventricular failure that is not responsive to optimal medical management and conventional treatment measures. The intent of the Impella system therapy is to reduce ventricular work and to provide the circulatory support necessary to allow heart recovery and early assessment of residual myocardial function. Optimal medical management and convention treatment measures include volume loading and use of pressors and inotropes, with or without an intra-aortic balloon pump, or IABP.

In December 2016, the FDA expanded a previously received PMA that granted approval for the use of the Impella CP device during elective and urgent high-risk PCI procedures in the U.S. With this indication, the Impella CP and the Impella 2.5 devices provide the only minimally invasive treatment options indicated for use during high-risk PCI procedures in the U.S.

In February 2018, we received two expanded PMAs from the FDA for certain of our Impella heart pumps. The first expanded PMA includes the Impella CP heart pump for use on patients with cardiogenic shock associated with cardiomyopathy, including peripartum and postpartum cardiomyopathy. The second expanded PMA includes the Impella CP heart pump for use during elective and high-risk PCI procedures, and it confirms Impella support as appropriate in patients with severe coronary artery disease, complex anatomy and extensive comorbidities, with or without depressed ejection fraction. These PMAs allow the Impella CP to be used as a temporary (≤ 6 hours) ventricular support system indicated for use during high risk PCI procedures performed in elective or urgent hemodynamically stable patients with severe coronary artery disease and depressed left ventricular ejection fraction, when a heart team, including a cardiac surgeon, has determined that high-risk PCI is the appropriate therapeutic option. The product labeling allows for the clinical decision by physicians to leave the Impella CP device in place beyond the intended duration of up to six hours should unforeseen circumstances arise.

In April 2018, we received FDA approval for our Impella CP SmartAssist^TM platform. The SmartAssist platform includes optical sensor technology for improved positioning, the use of algorithms that enable improved native heart assessment during the weaning process and cloud-based technology that enables secure, real-time, remote viewing of the Impella console for physicians and hospital staff from anywhere with internet connectivity. The platform is intended to provide enhanced monitoring capability, reduce setup time and improve ease of use for physicians. The SmartAssist platform is also approved under CE Mark in the European Union and other countries that require a CE Mark approval. We have begun a controlled roll-out of the SmartAssist platform at certain hospital sites.

In November 2018, we announced the results of our FDA approved prospective multi-center feasibility study, “STEMI Door to Unloading with Impella CP system in acute myocardial infarction” (STEMI DTU). The trial focused on the feasibility and safety of unloading the left ventricle using the Impella CP heart pump prior to primary PCI in patients presenting with ST segment elevation myocardial infarction, or STEMI, without cardiogenic shock with the hypothesis that this will potentially reduce infarct size. The study, which received FDA investigational device approval to proceed in October 2016, enrolled 50 patients at 10 sites. The hypothesis of this novel approach to treating STEMI patients, based on extensive mechanistic research, is that unloading the left ventricle prior to PCI reduces myocardial work load, oxygen demand and also initiates a cardio-protective effect at the myocardial cell level, which may alleviate myocardial damage caused by reperfusion injury at the time of revascularization. The intent of this study was to help refine the protocol and lay the groundwork for a future pivotal study with more sites and patients and will be designed for statistical significance.

In April 2019, the FDA approved the initiation of the STEMI DTU pivotal randomized controlled trial. The prospective, multi-center, two-arm trial plans to enroll 668 patients undergoing treatment for a STEMI heart attack at up to 60 sites. Half the patients will be randomized to receive delayed reperfusion after 30 minutes of left ventricular unloading with the Impella CP. The other half will receive immediate reperfusion, the current standard of care. The trial will test the hypothesis that unloading the left ventricle for 30 minutes prior to reperfusion will reduce myocardial damage from a heart attack and lead to a reduction in future heart failure related events. We began the trial in the third quarter of fiscal 2020 and we estimate that it will take three to four years to complete enrollment. The trial allows for an adaptive design, which permits adjustments to the study sample size after an interim analysis.

In March 2019, we received PMDA approval from MHLW for our Impella CP heart pump in Japan. We began selling the Impella CP heart pump as an additional product offering in Japan in fiscal 2020.

The Impella CP device has CE Mark approval in the European Union and other countries that require a CE Mark approval for up to five days of use.

The Impella 5.0 and Impella LD devices are percutaneous micro heart pumps with integrated motors and sensors for use primarily in the heart surgery suite. These devices are designed to support patients who require higher levels of circulatory support as compared to the Impella 2.5.

The Impella 5.0 device can be inserted into the left ventricle via a femoral cut down or through the axillary artery. The Impella 5.0 device is passed into the ascending aorta, across the valve and into the left ventricle. The Impella LD device is similar to the Impella 5.0 device, but it is implanted directly into the ascending aorta through an aortic graft. Both devices are normally used by cardiac surgeons in the surgery suite. The Impella 5.0 and Impella LD devices can pump up to five liters of blood per minute, potentially providing full circulatory support.

In April 2016, the FDA approved a PMA supplement for certain of our devices, including our Impella 5.0 and Impella LD devices, to provide treatment for ongoing cardiogenic shock. This PMA supplement covers a set of indications related to the use of the Impella devices in patients suffering cardiogenic shock following acute myocardial infarction, or cardiac surgery, and allows for a longer duration of support. The Impella 5.0 and LD catheters, in conjunction with the AIC, were approved as temporary ventricular support devices intended for short term use (≤ 6 days) and indicated for the treatment of ongoing cardiogenic shock that occurs immediately (< 48 hours) following acute myocardial infarction as a result of isolated left ventricular failure that is not responsive to optimal medical management and conventional treatment measures. The intent of the Impella system therapy is to reduce ventricular work and to provide the circulatory support necessary to allow heart recovery and early assessment of residual myocardial function.

In September 2016, we received PMDA approval from the Japanese Ministry Health Labour and Welfare, MHLW, for our Impella 5.0 heart pump to provide treatment of drug-resistant acute heart failure in Japan. In July 2017, we received approval from the Japanese MHLW for reimbursement for the Impella 5.0 heart pump. Reimbursement in Japan for the Impella 5.0 is equivalent to our average Impella sales price in the U.S.

In May 2019, we received an expanded PMA from the FDA for labeling of the Impella 5.0 and Impella LD for the treatment of cardiogenic shock. The expansion extends the duration of support for each pump from 6 days to 14 days. This approval expands the previous indication for acute myocardial infarction, cardiogenic shock and post-cardiotomy shock, or PCCS, received in April 2016, and use of the Impella 5.0 and Impella LD heart pumps to provide treatment for heart failure associated with cardiomyopathy leading to cardiogenic shock, received in February 2018.

The Impella 5.0 and Impella LD devices have CE Mark approval in the European Union for up to ten days’ duration and are approved for use in over 40 countries.

The Impella RP is a percutaneous catheter-based axial flow pump that is designed to allow greater than four liters of blood flow per minute and is intended to provide the flow and pressure needed to compensate for right side heart failure. The Impella RP is the first percutaneous single access heart pump designed for right heart support to receive FDA approval. The Impella RP device is approved to provide support of the right heart during times of acute failure for certain patients who have received a left ventricle assist device or have suffered heart failure due to AMI, a failed heart transplant, or following open heart surgery.

In September 2017, we received a PMA from the FDA for the Impella RP heart pump. This latest approval follows the prior FDA humanitarian device exemption, or HDE, received in January 2015 and adds the Impella RP heart pump to our platform of devices with PMAs. The Impella RP heart pump is indicated for providing temporary right ventricular support for up to 14 days in patients with a body surface area ≥1.5 m² who develop acute right heart failure or decompensation following left ventricular assist device implantation, myocardial infarction, heart transplant or open-heart surgery. With this approval, the Impella RP heart pump is the only percutaneous temporary ventricular support device that is FDA-approved as safe and effective for right heart failure as stated in the indication.

In February 2019, the FDA released a letter to health care providers on the Impella RP heart pump reiterating to physicians to follow proper protocols for the use of Impella RP. In May 2019, the FDA issued an update to its February 2019 letter to inform the health care community of these interim post-approval study results which validated that the Impella RP heart pump is safe and effective for the treatment of right heart failure. The results showed a 64% survival rate and 90% heart recovery for the subgroup of Impella RP post approval study patients who met the enrollment criteria of Impella RP’s premarket clinical studies. Impella RP is the only percutaneous technology with FDA approval designating it as safe and effective for right heart support

The Impella RP device has CE Mark approval for commercial sale in the European Union and other countries that require a CE Mark approval from commercial sales.

The Impella 5.5 device is designed to be a percutaneous micro heart pump with integrated motors and sensors. Impella 5.5 delivers peak flows of greater than six liters per minute. A motor housing that is thinner and 45% shorter than the Impella 5.0 improves ease of pump insertion through the vasculature.

In September 2019, the Impella 5.5 device received FDA pre-market approval for safety and efficacy in the therapy of cardiogenic shock for up to 14 days in the U.S. The Impella 5.5 pump is being introduced in the U.S. through a controlled rollout at hospitals with established heart recovery protocols beginning in the third quarter of fiscal 2020. Impella 5.5 received CE marking approval in Europe in April 2018 and was introduced in Europe through a similar controlled rollout.

The Impella ECP pump is designed for blood flow of greater than three liters per minute. It is intended to be delivered on a standard sized catheter and will include an expandable inflow in the left ventricle. We expect to conduct a first-in-human trial outside of the U.S. in calendar year 2020. The Impella ECP pump is still in development and has not been approved for commercial use or sale.

The Impella BTR device is designed to be a percutaneous micro heart pump with integrated motors and sensors. The Impella BTR device is designed to be smaller, provide up to one year of hemodynamic support and is expected to allow for greater than five liters of blood flow per minute. The Impella BTR device also includes a wearable driver designed for hospital discharge. The Impella BTR pump is still in development and has not been approved for commercial use or sale.

Other than the accounting policy changes discussed in “Note 2. Basis of Preparation and Summary of Significant Accounting Policies” to our consolidated financial statements, which is incorporated herein by reference, there have been no significant changes in our critical accounting policies during the three and nine months ended December 31, 2019, as compared to the critical accounting policies disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2019.

Results of Operations for the Three and Nine Months Ended December 31, 2019 compared with the Three and Nine Months Ended December 31, 2018

The following table sets forth certain condensed consolidated statements of operations data for the periods indicated as a percentage of total revenue:

Impella product revenue encompasses Impella 2.5, Impella CP, Impella 5.0, Impella LD, Impella RP, Impella 5.5 and Impella AIC product sales. Service and other revenue represents revenue earned on service maintenance contracts and preventative maintenance calls.

Total revenue for the three months ended December 31, 2019 increased by $21.0 million, or 10%, to $221.6 million from $200.6 million for the three months ended December 31, 2018. Total revenue for the nine months ended December 31, 2019 increased $71.8 million, or 13%, to $634.2 million from $562.4 million for the nine months ended December 31, 2018. The increase in total revenue was primarily due to higher Impella product revenue from increased utilization in the U.S, Europe, and Japan and the commercial launch of Impella 5.5 in the U.S. and Europe.

Impella product revenue for the three months ended December 31, 2019 increased by $19.3 million, or 10%, to $212.6 million from $193.3 million for the three months ended December 31, 2018. Impella product revenue for the nine months ended December 31, 2019 increased $67.2 million, or 12%, to $609.4 million from $542.2 million for the nine months ended December 31, 2018. Most of the increase in Impella product revenue was from increased device sales in the U.S., as we focus on increasing utilization of our disposable catheter products through continued investment in our field organization and physician training programs. Impella product revenue outside of the U.S. also increased primarily due to increased utilization in Germany and our continued launch of Impella in Japan. We expect worldwide revenue from our Impella devices to continue to increase with our recent PMA approvals in the U.S. and our continued focus on Impella device utilization outside of the U.S., with a primary focus on Germany and Japan.

Service and other revenue for the three months ended December 31, 2019 increased by $1.7 million, or 23%, to $9.0 million from $7.3 million for the three months ended December 31, 2018. Service and other revenue for the nine months ended December 31, 2019 increased $4.6 million, or 23%, to $24.8 million from $20.2 million for the nine months ended December 31, 2018. The increase in service revenue was primarily due to an increase in preventative maintenance service contracts. We have expanded the number of Impella AIC consoles at many of our existing higher volume customer sites and continue to sell additional consoles to new customer sites. We expect revenue growth for service revenue to be consistent with recent history as most of these using sites in the U.S. have service contracts that normally have three year terms.

Cost of revenue for the three months ended December 31, 2019 increased by $6.0 million, or 18%, to $40.0 million from $34.0 million for the three months ended December 31, 2018. Gross margin was 82.0% for the three months ended December 31, 2019 and 83.0% for the three months ended December 31, 2018.

Cost of revenue for the nine months ended December 31, 2019 increased by $17.2 million, or 18%, to $111.9 million from $94.7 million for the nine months ended December 31, 2018. Gross margin was 82.4% for the nine months ended December 31, 2019 and 83.2% for the nine months ended December 31, 2018.

The increase in cost of product revenue was related to higher demand for our Impella devices and higher production volume and costs to support demand for our Impella devices. The decrease in gross margin for the three and nine months ended December 31, 2019 was primarily due to increased investment in direct labor and overhead as we expand our manufacturing capacity in both our manufacturing facilities in the U.S. and Germany and our initial launch of Impella 5.5 and Impella CP SmartAssist, which enlists optical sensor technology in our pumps.

We expect that our ongoing investment in manufacturing capacity and the expansion of our Impella CP SmartAssist platform may decrease gross margin slightly in the near future.

Research and development expenses for the three months ended December 31, 2019 increased by $1.7 million, or 7%, to $25.7 million from $24.0 million for three months ended December 31, 2018. Research and development expense for the nine months ended December 31, 2019 increased $5.4 million, or 8%, to $73.4 million from $68.0 million for the nine months ended December 31, 2018. The increase in research and development expenses was primarily due to product development initiatives relating to our existing and pipeline products, such as optical sensor technology related to the development of Impella 5.5® and Impella ECP^TM devices, the expansion of our engineering organization, increased clinical spending primarily related to our ongoing clinical studies, including the STEMI DTU pivotal randomized controlled trial, and our continued focus on quality initiatives for our Impella products.

We expect research and development expenses to continue to increase as we continue to increase clinical spending related to our ongoing and potential future clinical studies and as we continue to focus on engineering initiatives to improve our existing products and develop new technologies.

Selling, general and administrative expenses for the three months ended December 31, 2019 increased by $5.5 million, or 7%, to $85.7 million from $80.2 million for the three months ended December 31, 2018. Selling, general, and administrative expenses for the nine months ended December 31, 2019 increased $17.4 million, or 7%, to $257.7 million from $240.3 million for the nine months ended December 31, 2018. The increase in selling, general and administrative expenses was primarily due to the hiring of additional field sales and clinical personnel in the U.S., Germany and Japan, increased spending on marketing initiatives as we continue to educate physicians on the benefits to patients of hemodynamic support with our Impella products, and legal expenses related to ongoing patent litigation and other legal matters discussed in “Note 13. Commitments and Contingencies” to our consolidated financial statements, partially offset by lower stock-based compensation expense.

We expect to continue to increase our expenditures on sales and marketing activities, with particular investments in field sales and clinical personnel with cath lab expertise to drive recovery awareness for acute heart failure patients. We also plan to increase our marketing, service and training investments in the U.S. for our Impella devices and as we continue our expansion in Germany, Japan and other new markets outside of the U.S. We expect to continue to have significant stock-based compensation expense in the future. We also expect to continue to incur significant legal expenses for the foreseeable future related to ongoing patent litigation, securities class action litigation and other legal matters discussed in “Note 13. Commitment and Contingencies” to our consolidated financial statements.

Our income tax provision was $27.8 million and $19.6 million for the three months ended December 31, 2019 and 2018, respectively and our income tax provision was $46.3 million for the nine months ended December 31, 2019 and an income tax benefit of $20.2 million for the nine months ended December 31, 2018. Our effective tax rate was 28.7% and 30.5% for the three months ended December 31, 2019 and 2018, respectively, and 21.3% and (12.3)% for the nine months ended December 31, 2019 and 2018, respectively. The increase in the effective income tax rate was due primarily to lower excess tax benefits recognized associated with stock-based awards of $0.5 million and $1.7 million as an income tax benefit for the three months ended December 31, 2019 and 2018, respectively, and of $13.8 million and $68.5 million recorded as an income tax benefit for the nine months ended December 31, 2019 and 2018, respectively. These recognized excess tax benefits resulted from restricted stock units that vested or stock options that were exercised during the three and nine months ended December 31, 2019, respectively.

For the three months ended December 31, 2019, net income was $69.2 million, or $1.53 per basic share and $1.51 per diluted share, compared to $44.9 million, or $1.00 per basic share and $0.97 per diluted share, for three months ended December 31, 2018. For the nine months ended December 31, 2019, net income was $171.2 million, or $3.79 per basic share and $3.73 per diluted share, compared to $185.1 million, or $4.13 per basic share and $4.01 per diluted share for the nine months ended December 31, 2018.

Our net income for three and nine months ended December 31, 2019 was also driven by higher Impella product revenue due to greater utilization of our Impella devices and our focus on managing expenses in line with revenues.

Net income for the three months ended December 31, 2019 included excess tax benefits related to stock-based awards of $0.5 million, or $0.01 per basic and diluted share, and a $17.8 million unrealized gain, net of tax, or $0.39 per basic and diluted share, related to our investment in Shockwave Medical. Net income for the nine months ended December 31, 2019 included excess tax benefits related to stock-based awards of $13.8 million, or $0.30 per basic and diluted share, and a $13.3 million unrealized gain, net of tax, or $0.29 per basic and diluted share, related to our investment in Shockwave Medical. Net income for the three months ended December 31, 2018, included excess tax benefits of $1.7 million, or $0.04 per basic share and diluted share. Net income for the nine months ended December 31, 2018 included excess tax benefits of $68.5 million, or $1.53 per basic share and $1.48 per diluted share.

At December 31, 2019, our total cash, cash equivalents and marketable securities totaled $595.5 million, an increase of $82.1 million compared to $513.4 million at March 31, 2019. The increase in our cash, cash equivalents and marketable securities during the nine months ended December 31, 2019 was primarily due to cash flows provided by operating activities offset by cash used to fund our stock repurchase program, annual bonuses, taxes paid related to net settlement of vesting of stock awards during the period and purchases of property and equipment.

For the nine months ended December 31, 2019, cash provided by operating activities consisted of net income of $171.2 million, adjustments for non-cash items of $70.2 million and cash used in working capital of $13.1 million. The change in net income was primarily due to higher revenue from increased utilization of our Impella devices and an unrealized gain related to our investment in Shockwave Medical. Adjustments for non-cash items consisted primarily of $37.0 million of stock-based compensation expense, $30.6 million in deferred tax provision, $14.4 million of depreciation and amortization expense, $2.7 million in accretion on marketable securities, and $4.0 million in inventory and other write-downs. The change in cash from working capital included a $13.3 million increase in inventory to support demand for our Impella devices, $10.3 million increase in accounts receivable due to timing of collections offset by a $12.0 million increase in accounts payable and accrued expenses and a $2.8 million increase in deferred revenue.

For the nine months ended December 31, 2018, cash provided by operating activities consisted of net income of $185.1 million, adjustments for non-cash items of $29.8 million and cash used in working capital of $33.1 million. The increase in net income was primarily due to higher revenue from increased utilization of our Impella devices. Adjustments for non-cash items consisted primarily of $43.8 million of stock-based compensation expense, a $26.0 million change in deferred tax provision, $9.9 million of depreciation and amortization expense, $3.2 million in inventory and other write-downs, and $1.6 million in accretion on marketable securities. Cash used in working capital consisted of a $19.3 million increase in accounts receivable due to increased sales and a $26.5 million increase in inventory to support growing demand for our Impella devices, offset by an $11.8 million increase in accounts payable and accrued expenses primarily due to increased expenditures.

For the nine months ended December 31, 2019, net cash used for investing activities primarily consisted of $81.1 million in maturities (net of purchases) of marketable securities and $33.5 million used in the purchase of property and equipment primarily related to continued expansion of manufacturing capacity, office space and research development facilities in Danvers and Aachen, Germany. We invested an additional $20.9 million of investments in other assets and intangible assets during fiscal 2020.

For the nine months ended December 31, 2018, net cash used for investing activities primarily consisted of $14.8 million in maturities (net of purchases) of marketable securities and $35.5 million for the purchase of property and equipment primarily related to continued expansion of manufacturing capacity, office space and research development facilities in Danvers, Massachusetts and Aachen, Germany. We also made $30.4 million of investments in other assets and intangible assets.

For the nine months ended December 31, 2019, net cash used for financing activities included $41.6 million in payments in lieu of issuance of common stock for payroll withholding taxes upon vesting of certain equity awards and $59.9 million for the repurchase of our common stock. These amounts were offset by $3.2 million in proceeds from the exercise of stock options and $2.4 million in proceeds from the issuance of stock under the employee stock purchase plan.

For the nine months ended December 31, 2018, net cash used for financing activities included $71.2 million in payments in lieu of issuance of common stock for payroll withholding taxes upon vesting of certain equity awards. This amount was offset by $11.0 million in proceeds from the exercise of stock options and $1.4 million in proceeds from the issuance of stock under the employee stock purchase plan.

We believe that cash receipts from our revenue together with existing resources will be sufficient to fund our operations for at least the next twelve months, exclusive of activities involving any future acquisitions of products or companies that complement or augment our existing line of products.

Our primary liquidity requirements are to fund the expansion of our commercial and operational infrastructure, increase our manufacturing capacity, increase our inventory levels in order to meet growing customer demand for our Impella devices, fund new product development initiatives, continue our controlled commercial launch of Impella devices in Japan and expand to potential new markets, increase clinical spending, cover legal expenses related to ongoing patent litigation, cover payments in lieu of issuing of common stock for payroll withholding taxes upon vesting of certain equity awards, fund our stock repurchase program, fund business development initiatives and provide for general working capital needs. To date, we have primarily funded our operations through product sales and, to a lesser extent the sale of equity securities.

Capital expenditures for fiscal 2020 are estimated to range from $40 million to $60 million, including additional capital expenditures for manufacturing capacity expansions in our Danvers and Aachen facilities, additional office space, building and leasehold improvements and information systems development projects.

Our liquidity is influenced by our ability to sell our products in a competitive industry and our customers’ ability to pay for our products. Factors that may affect liquidity include our ability to penetrate the market for our products, our ability to maintain or reduce the length of the selling cycle for our products, capital expenditures, investments in collaborative arrangements with other partners, and our ability to collect cash from customers after our products are sold. We also expect to continue to incur legal expenses for the foreseeable future related to ongoing patent litigation and other legal matters. We continue to review our short-term and long-term cash needs on a regular basis. At December 31, 2019 we had no long-term debt outstanding.

In August 2019, our Board of Directors authorized a stock repurchase program for up to $200 million of shares of its common stock. Under this stock repurchase program, we are authorized to repurchase shares through open market purchases, privately negotiated transactions or otherwise in accordance with applicable federal securities laws, including through Rule 10b5-1 trading plans and under Rule 10b-18 of the Exchange Act. The stock repurchase program has no time limit and may be suspended for periods or discontinued at any time. The Company is funding the stock repurchase program with its available cash and marketable securities. Through December 31, 2019, the Company has repurchased a total of 318,361 shares for $59.9 million under the stock repurchase program. The remaining authorization under the stock repurchase program was $140.1 million as of December 31, 2019.

Marketable securities at December 31, 2019 and March 31, 2019 consisted of $477.6 million and $392.4 million, respectively, held in investment funds that are invested in U.S. Treasury, government-backed and corporate debt securities, and commercial paper. As of December 31, 2019, the Company is not a party to any interest rate swaps and have no exposure to auction rate securities markets.

Cash and cash equivalents held by our foreign subsidiaries totaled $20.9 million and $25.2 million at December 31, 2019 and March 31, 2019, respectively. Our operating income outside the U.S. is deemed to be permanently reinvested in foreign jurisdictions. Since most of our cash and cash equivalents held by foreign subsidiaries which are disregarded entities for domestic tax purposes, any repatriation of foreign subsidiary earnings to the U.S. would likely have a nominal tax impact.

We had no off-balance sheet arrangements or guarantees of third-party obligations during the periods presented. An “off-balance sheet arrangement” generally entails a transaction, agreement or other contractual arrangement to which an entity unconsolidated with us, is a party under which we have any obligation arising under a guarantee contract, derivative instrument or variable interest or a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.

We have various contractual obligations, which are recorded as liabilities in our consolidated condensed financial statements. Other items are not recognized as liabilities in our consolidated condensed financial statements but are required to be disclosed. There have been no material changes, outside of the ordinary course of business, to our contractual obligations as previously disclosed in our Annual Report on Form 10-K for the fiscal year ended March 31, 2019.

There have been no material changes to our quantitative and qualitative disclosures about market risk as compared to the quantitative and qualitative disclosures about market risk described in our Annual Report on Form 10-K for the fiscal year ended March 31, 2019.

Our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act), as of December 31, 2019. Based on this evaluation, our principal executive officer and principal financial officer concluded that, as of December 31, 2019, these disclosure controls and procedures were effective to provide reasonable assurance that material information required to be disclosed by us, including our consolidated subsidiaries, in reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in SEC rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

During the third quarter of our fiscal year ending March 31, 2020, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We are from time to time involved in various legal actions, the outcomes of which are not within our complete control and may not be known for prolonged periods of time. In some actions, the claimants seek damages, as well as other relief, which, if granted, would require significant expenditures and could impair our business and results of operations. Material legal proceedings are discussed in “Note 13. Commitments and Contingencies” to our condensed consolidated financial statements and such information is incorporated herein by reference.

Investing in our common stock involves a high degree of risk. In addition to the other information set forth in this Report, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended March 31, 2019, which could materially affect our business, financial condition or future results. As of the date of this Report, there has been no material change in any of the risk factors described in our Annual Report on Form 10-K for the fiscal year ended March 31, 2019, other than with respect to the below.

Environmental and health safety laws may result in liabilities, expenses and restrictions on our operations.

Federal, state, local and foreign laws regarding environmental protection, hazardous substances and human health and safety may adversely affect our business. Using hazardous substances in our operations exposes us to the risk of accidental injury, contamination or other liability from the use, storage, importation, handling or disposal of hazardous materials. If our or our suppliers’ operations result in pollution of the environment or expose individuals to hazardous substances, we could be liable for damages, expenses, and fines, and any liability could significantly exceed our insurance coverage and have a material adverse effect on our financial condition. Additionally, increased costs on our suppliers stemming from compliance with new or existing environmental or health safety laws and regulations may adversely affect us, as such laws and regulations could result in operational impacts, including facility shutdowns. Suppliers may also choose to pass compliance costs to us in the form of adjusted pricing.

Recent and any future environmental regulatory action regarding medical device sterilization may adversely impact us in the ways described above. Many of our products require sterilization prior to sale, and we contract with third-party sterilizers to perform this service, including ethylene oxide sterilizers. On November 6, 2019, the U.S. Environmental Protection Agency (the “EPA”) proposed amendments to the Miscellaneous Organic Chemical Manufacturing National Emission Standards for Hazardous Air Pollutants to reduce hazardous air pollutants, including emissions of ethylene oxide, by adding requirements for process vents, storage tanks and equipment in ethylene oxide service. Additional regulation to address ethylene oxide emissions at sterilization facilities is expected, including revisions to the EPA’s Ethylene Oxide Emissions Standards for Sterilization Facilities: National Emission Standards for Hazardous Air Pollutants. In addition, as of the date of this Report, state agencies have shut down and/or temporarily suspended operations at ethylene oxide sterilization facilities in Illinois, Michigan and Georgia. The FDA has voiced concerns that these shutdowns may diminish the supply of available sterilization facilities and cause medical device shortages. While the facilities shut down or suspended to date do not sterilize our products and are not otherwise in our supply chain, and our suppliers are not affected directly by these recent regulatory actions, increased scrutiny and regulation of ethylene oxide sterilization facilities in the U.S. could create additional costs for our suppliers, who may be required to take steps with respect to their sterilization processes. These costs could, in turn, be passed on to us and adversely affect our business. Also, to the extent we or our contract sterilizers are unable to sterilize our products, whether due to these regulatory or other constraints (such as capacity or availability of materials for sterilization), we may be unable to transition to other contract sterilizers, sterilizer locations or sterilization methods in a timely or cost effective manner, or at all. This failure to transition our processes due to decreased third-party sterilization capacity could have a materially adverse impact on our results of operations and financial condition.

We maintain insurance for certain environmental risks, subject to deductibles; however, we cannot assure that we can continue to maintain this insurance in the future at an acceptable cost or at all. Future changes to environmental and health safety laws could cause us to incur additional expenses or restrict our operations.

The market price of our common stock is volatile, which has in the past led to and may in the future lead to securities litigation against us. Such litigation may be costly and result in an adverse outcome.

The market price of our common stock has fluctuated widely and may continue to do so. Many factors could cause the market price of our common stock to rise and fall. Some of these factors are:

In addition, the stock market in general and the market for shares of medical device companies in particular have experienced extreme price and volume fluctuations in recent years. These fluctuations are often unrelated to the operating performance of individual companies. These broad market fluctuations may adversely affect the market price of our common stock. When the market price of a company’s stock drops significantly, stockholders often institute securities class action litigation against that company. For instance, in August 2019, two purported class action complaints were filed against us and certain of our officers in the U.S. District Court for the Southern District of New York (“SDNY”) by an alleged purchaser of the Company’s common stock, on behalf of the plaintiffs themselves and persons or entities that purchased or acquired the Company’s securities relating to allegedly misleading disclosures made by us regarding our financial condition and results of operations. In November 2019, two shareholders filed derivative actions in the SDNY that were subsequently consolidated, and another shareholder filed a derivative action in Massachusetts Suffolk County Superior Court. In January 2020, another shareholder derivative action was filed in the U.S. District Court for the District of Delaware. The complaints in these actions rely on many of the same allegations as in the securities class actions. For additional discussion, see “Note 13. Commitment and Contingencies – Contingencies” to our consolidated financial statements in this report, which is incorporated by reference into this item.

We are generally obliged under our bylaws, to the extent permitted under Delaware law, to indemnify our current and former officers who are named as defendants in these types of lawsuits. While a certain amount of insurance coverage is available for expenses or losses associated with these lawsuits, this coverage may not be sufficient. Based on information currently available, we are unable to estimate reasonably a possible loss or range of possible losses, if any, with regard to the class action litigation; therefore, no litigation reserve has been recorded in our consolidated balance sheet. Although we plan to defend against the class action litigation vigorously, there can be no assurances that a favorable final outcome will be obtained. This litigation and other future litigation against us could cause us to incur substantial costs, divert the time and attention of our management and other resources, or otherwise harm our business.

(a) Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

On February 4, 2020, the Company’s board of directors (the “Board”) adopted amendments to the Company’s Amended and Restated By-laws (the “By-laws,” and as so amended, the “Amended By-laws”), effectively immediately, to change the requirements under which stockholders may (i) nominate persons for election to the Board or bring business before an annual meeting of stockholders and (ii) nominate persons for election to the Board at a special meeting of stockholders called by the Board for that purpose, in each case, without including such matters in the Company’s proxy materials. As amended, nominations and notices of other business to be brought before an annual meeting must be received at the Company’s principal executive offices not more than 120 days nor less than 90 days prior to the anniversary date of the immediately preceding annual meeting. Director nominations for a special meeting must be received at the Company’s principal executive offices not more than 120 days prior to the scheduled date of the special meeting nor less than (i) 90 days prior to the scheduled date of the special meeting or (ii) 10 days following the date on which the Company publicly announces the special meeting. In addition, the amendments to the By-laws expand upon the procedural requirements applicable to stockholders who wish to nominate director candidates or propose other business at a meeting of stockholders, by adding certain customary informational and other requirements regarding the proposing stockholder and any director nominee. The Board made the amendments to the timing and other procedural requirements for stockholder nominations and proposals of other business to align them with peer company norms. The Board also enacted amendments to the provisions of the By-laws that permit the Board to act unanimously without a meeting, by clarifying that Board members may consent to such action by electronic transmission, and made certain other immaterial conforming amendments.

The foregoing summary of the amendments to the By-laws is qualified in its entirety by reference to the Amended By-laws, a copy of which is filed with this Quarterly Report as Exhibit 3.2.1 and incorporated in this Part II, Item 5 by reference. Additionally, a copy of the Amended By-laws, marked to show changes to the By-laws, is also included as Exhibit 3.2.2 hereto (additions are underlined and deletions are struck through) and incorporated herein by reference.

(b) See Item 5(a) above, which supplements the disclosure on the consideration of stockholder nominees for election to the Board in the Company’s proxy statement on Schedule 14A, filed with the SEC on June 25, 2019.

Exhibit No.	Description	Filed with This Form 10-Q	Incorporated by Reference
Exhibit No.	Description	Filed with This Form 10-Q	Form	Filing Date	Exhibit No.

3.1	Restated Certificate of Incorporation		S-3	September 29, 1997	3.1

3.2.1	Amended & Restated By-Laws, as Amended and Restated February 4, 2020	X

3.2.2	Amended & Restated By-Laws, as Amended and Restated February 4, 2020 (Marked)	X

3.3	Amendment to the Company’s Restated Certificate of Incorporation to increase the authorized shares of common stock from 25,000,000 to 100,000,000		8-K	March 21, 2007 (File No. 001-09585)	3.4

31.1	Rule 13a—14(a)/15d—14(a) certification of principal executive officer	X

31.2	Rule 13a—14(a)/15d—14(a) certification of principal accounting officer	X

32.1	Section 1350 certification	X

101	The following financial information from the ABIOMED, Inc. Quarterly Report on Form 10-Q for the quarter ended December 31, 2019, formatted in inline Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance Sheets as of December 31, 2019 and March 31, 2019; (ii) Condensed Consolidated Statements of Operations for the three and nine months ended December 31, 2019 and 2018; (iii) Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended December 31, 2019 and 2018; (iv) Condensed Consolidated Statements of Cash Flows for the nine months ended December 31, 2019 and 2018; and (v) Notes to Condensed Consolidated Financial Statements.	X

104*	Cover page from the ABIOMED, Inc. Quarterly Report on Form 10-Q for the quarter ended December 31, 2019, formatted in iXBRL and contained in Exhibit 101.	X

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

Delaware		04-2743260
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, $0.01 par value	ABMD	The NASDAQ Stock Market LLC

PART I - FINANCIAL INFORMATION:			Page

Item 1.	Condensed Consolidated Financial Statements (unaudited)	3

	Condensed Consolidated Balance Sheets as of December 31, 2019 and March 31, 2019	3

	Condensed Consolidated Statements of Operations for the three and nine months ended December 31, 2019 and 2018	4

	Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended December 31, 2019 and 2018	5

	Condensed Consolidated Statements of Stockholders’ Equity for the three and nine months ended December 31, 2019 and 2018	6

	Condensed Consolidated Statements of Cash Flows for the nine months ended December 31, 2019 and 2018	7

	Notes to Condensed Consolidated Financial Statements (unaudited)	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	36

Item 4.	Controls and Procedures	36

PART II - OTHER INFORMATION:

Item 1.	Legal Proceedings	37

Item 1A.	Risk Factors	37

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	38

Item 3.	Defaults Upon Senior Securities	39

Item 4.	Mine Safety Disclosures	39

Item 5.	Other Information	39

Item 6.	Exhibits	40

Signatures		41

	For the Three Months Ended December 31,						For the Nine Months Ended December 31,
	2019			2018			2019			2018
Net income	$	69,217		$	44,862		$	171,211		$	185,056
Other comprehensive income (loss):
Foreign currency translation gain (loss)		1,945			(1,015	)		(1,436	)		(8,468	)
Unrealized loss on derivative instrument		(1,392	)		—			(1,392	)		—
Net unrealized gains on marketable securities		8			234			522			356
Other comprehensive income (loss)		561			(781	)		(2,306	)		(8,112	)

Comprehensive income	$	69,778		$	44,081		$	168,905		$	176,944

	For the Three Months Ended December 31,				For the Nine Months Ended December 31,
		2019		2018		2019		2018
	(in $000's)				(in $000's)
U.S. revenue	$	185,569	$	172,548	$	533,070	$	488,386
International revenue		36,015		28,015		101,155		73,965
Total revenue	$	221,584	$	200,563	$	634,225	$	562,351

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

	Amortized		Gross Unrealized		Gross Unrealized			Fair Market
	Cost		Gains		Losses			Value
December 31, 2019:	(in $000's)
Money market funds	$	36,674	$	—	$	—		$	36,674
Repurchase agreements		20,000		—		—			20,000
Short-term U.S. Treasury mutual fund securities		37,158		23		—			37,181
Short-term government-backed securities		108,117		121		(11	)		108,227
Short-term corporate debt securities		124,113		149		(4	)		124,258
Short-term commercial paper		39,903		9		(9	)		39,903
Long-term U.S. Treasury mutual fund securities		10,086		2		—			10,088
Long-term government-backed securities		71,963		46		(26	)		71,983
Long-term corporate debt securities		85,348		562		—			85,910
	$	533,362	$	912	$	(50	)	$	534,224

				December 31, 2019
	Effective Date	Maturity	Fixed Rate	Aggregate Notional Amount
Pay EUR	October 15,	October 15,	2.75%		EUR 85,000
Receive U.S.$	2019	2024	4.64%		USD 93,457

		December 31, 2019
Derivatives designated as hedging instruments under ASC 815	Balance Sheet classification	Fair Value
Cross-currency swap	Other assets (long term liabilities)	$	(3,278	)

	Level 1		Level 2		Level 3		Total
December 31, 2019:	(in $000's)
Assets
Money market funds	$	36,674	$	—	$	—	$	36,674
Repurchase agreements		—		20,000		—		20,000
Short-term U.S. Treasury mutual fund securities		—		37,181		—		37,181
Short-term government-backed securities		—		108,227		—		108,227
Short-term corporate debt securities		—		124,258		—		124,258
Short-term commercial paper		—		39,903		—		39,903
Long-term U.S. Treasury mutual fund securities				10,088		—		10,088
Long-term government-backed securities		—		71,983		—		71,983
Long-term corporate debt securities		—		85,910		—		85,910
Investment in Shockwave Medical		73,735		—		—		73,735
Liabilities
Cross-currency swap agreement		—		3,278		—		3,278
Contingent consideration		—		—		10,440		10,440

	(in $000's)
Balance, March 31, 2019	$	32,601
Foreign currency translation impact		(7	)
Balance, December 31, 2019	$	32,594

(in thousands, except lease term and discount rate)

Fiscal Years Ended March 31,
2020	$	895
2021		3,378
2022		2,561
2023		1,533
2024		1,442
Thereafter		3,322
Total minimum lease payments		13,131
Less: imputed interest		(510	)
Present value of operating lease liabilities	$	12,621

Weighted average remaining lease term	5.59

Weighted average discount rate		3.23	%

	Nine Months Ended December 31, 2019
	Foreign Currency Items			Unrealized Gains and Losses on Investments			Gains and Losses on cash flow hedge			Total
Balance, April 1, 2019		(15,028	)		339			—			(14,689	)
Other comprehensive income (loss)		2,334			600			—			2,934
Balance, June 30, 2019		(12,694	)		939			—			(11,755	)
Other comprehensive income (loss)		(5,716	)		(85	)		—			(5,801	)
Balance, September 30, 2019		(18,410	)		854			—			(17,556	)
Other comprehensive income (loss)		1,945			8			(1,392	)		561
Balance, December 31, 2019	$	(16,465	)	$	862		$	(1,392	)	$	(16,995	)

	Nine Months Ended December 31, 2018
	Foreign Currency Items			Unrealized Gains and Losses on Investments			Gains and Losses on cash flow hedge		Total
Balance, April 1, 2018		(3,597	)		(607	)		—		(4,204	)
Other comprehensive income (loss)		(6,852	)		143			—		(6,709	)
Balance, June 30, 2018		(10,449	)		(464	)		—		(10,913	)
Other comprehensive income (loss)		(600	)		(22	)		—		(622	)
Balance, September 30, 2018		(11,049	)		(486	)		—		(11,535	)
Other comprehensive income (loss)		(1,015	)		234			—		(781	)
Balance, December 31, 2018	$	(12,064	)	$	(252	)	$	-	$	(12,316	)

						Weighted
				Weighted		Average		Aggregate
				Average		Remaining		Intrinsic
	Options			Exercise		Contractual		Value
	(in thousands)			Price		Term (years)		(in thousands)
Outstanding at beginning of period		853		$	87.14		5.57
Granted		117			259.52
Exercised		(65	)		48.67
Cancelled and expired		(14	)		235.87
Outstanding at end of period		891		$	110.27		5.46	$	79,843
Exercisable at end of period		668		$	62.60		4.39	$	77,717
Options vested and expected to vest at end of period		888		$	110.28		5.46	$	79,672

	Number of Shares			Weighted Average Grant Date Fair Value
	(in thousands)			(per share)
Restricted stock units at beginning of period		620		$	193.53
Granted		159			260.13
Vested		(391	)		144.39
Forfeited		(65	)		307.40
Restricted stock units at end of period		323		$	264.48

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Approximate Dollar Value Maximum of Shares that May Yet Be Purchased Under the Plans or Programs (in $000's)
October 1-31, 2019	104,266		$173.30		104,266		$147,057
November 1-30, 2019	33,166		209.1		33,166		140,122
December 1-31, 2019	—		—		—		140,122
Total	137,432	(2)	$181.94	(2)	137,432	(2)	$140,122	(1)

		ABIOMED, Inc.

Date: February 6, 2020		/s/ TODD A. TRAPP
		Todd A. Trapp
		Vice President and Chief Financial Officer

Stock-Based Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	9 Months Ended
	May 31, 2019	Dec. 31, 2019	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period		3 years
Aggregate intrinsic value of options exercised in period		$ 12,200
Proceeds from the exercise of stock options		3,165	$ 11,043
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation expense		$ 15,200
Unrecognized stock-based compensation expense, estimated weighted-average recognition period		2 years
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period		3 years
Unrecognized stock-based compensation expense		$ 41,100
Unrecognized stock-based compensation expense, estimated weighted-average recognition period		1 year 9 months 18 days
Weighted average grant-date fair value		$ 260.13
Fair value of units vested		$ 99,100
Restricted share unit issued		159,000
Performance Based Restricted Stock Units \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted share unit issued	196,580

Valuation Method Used to Calculate Level 3 Liabilities Measured at Estimated Fair Value of Contingent Consideration Related to Acquisition (Detail) $ in Thousands	9 Months Ended
	Dec. 31, 2019 USD ($)	Mar. 31, 2019 USD ($)
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Contingent consideration	$ 10,440	$ 9,575
ECP Entwicklungsgesellschaft mbH \| Discount Rate
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Alternative investment, measurement input	0.21
Level 3
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Contingent consideration	$ 10,440	$ 9,575
Level 3 \| ECP Entwicklungsgesellschaft mbH
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Milestone Payment	15,000
Contingent consideration	10,440
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Probability weighted income approach \| Clinical and regulatory milestone
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Milestone Payment	7,000
Contingent consideration	$ 5,617
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Probability weighted income approach \| Clinical and regulatory milestone \| Contingent Consideration \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Projected fiscal year of milestone payments	2021
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Probability weighted income approach \| Clinical and regulatory milestone \| Contingent Consideration \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Projected fiscal year of milestone payments	2023
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Probability weighted income approach \| Clinical and regulatory milestone \| Various Downside and Upside Scenarios \| Contingent Consideration \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Probability of occurrence	15.00%
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Probability weighted income approach \| Clinical and regulatory milestone \| Various Downside and Upside Scenarios \| Contingent Consideration \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Probability of occurrence	40.00%
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Probability weighted income approach \| Clinical and regulatory milestone \| Base Case Scenario \| Contingent Consideration
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Probability of occurrence	45.00%
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Probability weighted income approach \| Clinical and regulatory milestone \| Discount Rate \| Contingent Consideration \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Alternative investment, measurement input	0.0284
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Probability weighted income approach \| Clinical and regulatory milestone \| Discount Rate \| Contingent Consideration \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Alternative investment, measurement input	0.0286
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Monte Carlo simulation model \| Revenue-based milestone
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Milestone Payment	$ 8,000
Contingent consideration	$ 4,823
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Monte Carlo simulation model \| Revenue-based milestone \| Contingent Consideration
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Probability of payment (risk neutral)	73.80%
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Monte Carlo simulation model \| Revenue-based milestone \| Contingent Consideration \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Projected fiscal year of milestone payments	2025
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Monte Carlo simulation model \| Revenue-based milestone \| Contingent Consideration \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Projected fiscal year of milestone payments	2035
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Monte Carlo simulation model \| Revenue-based milestone \| Discount Rate \| Contingent Consideration
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Alternative investment, measurement input	0.18
Level 3 \| ECP Entwicklungsgesellschaft mbH \| Monte Carlo simulation model \| Revenue-based milestone \| Measurement Input, Price Volatility \| Contingent Consideration
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Alternative investment, measurement input	0.50

Financial Instruments - Additional Information (Detail) € in Millions, $ in Millions	1 Months Ended	3 Months Ended	9 Months Ended
	Jul. 31, 2014 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2019 EUR (€)	Oct. 30, 2019 EUR (€)
ECP Entwicklungsgesellschaft mbH and AIS GmbH Aachen Innovative Solutions
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Payments to acquire businesses, cash paid	$ 13.0
Potential payouts payments	$ 15.0
Intercompany Agreement [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Loans to subsidiaries \| €					€ 85.0
Cross-currency swap
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative notional amount		$ 93.5	$ 93.5	€ 85.0
Other income, net		$ 0.4	$ 0.4

Carrying Value of Goodwill and Change in Balance (Detail) $ in Thousands	9 Months Ended
	Dec. 31, 2019 USD ($)
Goodwill And Intangible Assets Disclosure [Abstract]
Beginning balance	$ 32,601
Foreign currency translation impact	(7)
Ending balance	$ 32,594

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Operating activities:
Net income	$ 171,211	$ 185,056
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	14,427	9,936
Bad debt expense	241	578
Stock-based compensation	37,019	43,757
Write-down of inventory and other	3,984	3,152
Accretion on marketable securities	(2,678)	(1,644)
Change in fair value of other investments	(17,407)
Deferred tax provision	30,551	(25,992)
Change in fair value of contingent consideration	865	93
Other non-cash operating activities	3,167
Changes in assets and liabilities:
Accounts receivable	(10,333)	(19,268)
Inventories	(13,261)	(26,522)
Prepaid expenses and other assets	(4,250)	678
Accounts payable	841	4,909
Accrued expenses and other liabilities	11,193	6,909
Deferred revenue	2,757	164
Net cash provided by operating activities	228,327	181,806
Investing activities:
Purchases of marketable securities	(491,513)	(241,745)
Proceeds from the sale and maturity of marketable securities and other	410,456	226,949
Purchases of other investments and intangible assets	(20,899)	(30,436)
Purchases of property and equipment	(33,460)	(35,469)
Net cash used for investing activities	(135,416)	(80,701)
Financing activities:
Proceeds from the exercise of stock options	3,165	11,043
Taxes paid related to net share settlement upon vesting of stock awards	(41,607)	(71,213)
Repurchase of common stock	(59,876)
Proceeds from the issuance of stock under employee stock purchase plan	2,368	1,376
Net cash used for financing activities	(95,950)	(58,794)
Effect of exchange rate changes on cash	(12)	(1,105)
Net (decrease) increase in cash and cash equivalents	(3,051)	41,206
Cash and cash equivalents at beginning of period	121,021	42,975
Cash and cash equivalents at end of period	117,970	84,181
Supplemental disclosure of cash flow information:
Cash paid for income taxes	7,479	4,500
Supplemental disclosure of non-cash activities:
Property and equipment in accounts payable and accrued expenses	3,314	$ 1,670
Right-of-use assets obtained in exchange for lease liabilities	$ 14,596

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2019	Mar. 31, 2019
Statement Of Financial Position [Abstract]
Class B Preferred Stock, par value	$ 0.01	$ 0.01
Class B Preferred Stock, Authorized	1,000,000	1,000,000
Class B Preferred Stock, Issued	0	0
Class B Preferred Stock, outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, Authorized	100,000,000	100,000,000
Common stock, Issued	47,498,385	47,026,226
Common stock, Outstanding	45,112,835	45,122,985
Treasury stock, shares	2,385,550	1,903,241

Stockholders' Equity - Schedule of Share Repurchase Activity (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Dec. 31, 2019
Stockholders Equity Note [Abstract]
Shares repurchased (in shares)	137,432		318,361
Average price per share	$ 181.94		$ 188.08
Shares repurchased, value	$ 25,002	$ 34,874	$ 59,900

Equity Method and Other Investments Classified as Other Assets (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Sep. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Mar. 31, 2018
Long Term Investments [Abstract]
Other investments	$ 114,169		$ 80,779
Equity method investment	2,867
Total equity and other investments	$ 117,036	$ 81,836	$ 80,779	$ 40,784	$ 22,325	$ 12,649

Maturities of Operating Lease Liabilities (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Leases [Abstract]
2020	$ 895
2021	3,378
2022	2,561
2023	1,533
2024	1,442
Thereafter	3,322
Total minimum lease payments	13,131
Less: imputed interest	(510)
Present value of operating lease liabilities	$ 12,621
Weighted average remaining lease term	5 years 7 months 2 days
Weighted average discount rate	3.23%

Cash Equivalents and Marketable Securities (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Mar. 31, 2019
Fair Value Disclosures [Abstract]
Cash equivalents	$ 56,674	$ 80,089
Short-term marketable securities	309,569	370,677
Long-term marketable securities	167,981	21,718
Total cash and marketable securities	$ 534,224	$ 472,484

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Total	Common Stock	Treasury Stock	Additional Paid in Capital	Retained Earnings	Accumulated Other Comprehensive Loss
Beginning Balance at Mar. 31, 2018	$ 689,524	$ 444	$ (67,078)	$ 619,905	$ 140,457	$ (4,204)
Beginning Balance (in shares) at Mar. 31, 2018		44,375,337	1,725,312
Restricted stock units issued		$ 4		(4)
Restricted stock units issued (in shares)		384,887
Stock options exercised	5,798	$ 3		5,795
Stock options exercised (in shares)		282,368
Stock issued to directors	33			33
Stock issued to directors (in shares)		80
Return of common stock to pay withholding taxes on restricted stock	(67,598)	$ (2)	$ (67,596)
Return of common stock to pay withholding taxes on restricted stock (in shares)		(166,401)	166,401
Stock compensation expense	12,245			12,245
Other comprehensive income (loss)	(6,709)					(6,709)
Net income	90,066				90,066
Ending Balance at Jun. 30, 2018	723,359	$ 449	$ (134,674)	637,974	230,523	(10,913)
Ending Balance (in shares) at Jun. 30, 2018		44,876,271	1,891,713
Beginning Balance at Mar. 31, 2018	689,524	$ 444	$ (67,078)	619,905	140,457	(4,204)
Beginning Balance (in shares) at Mar. 31, 2018		44,375,337	1,725,312
Other comprehensive income (loss)	(8,112)
Net income	185,056
Ending Balance at Dec. 31, 2018	851,530	$ 451	$ (138,289)	676,171	325,513	(12,316)
Ending Balance (in shares) at Dec. 31, 2018		45,058,049	1,901,604
Beginning Balance at Jun. 30, 2018	723,359	$ 449	$ (134,674)	637,974	230,523	(10,913)
Beginning Balance (in shares) at Jun. 30, 2018		44,876,271	1,891,713
Restricted stock units issued (in shares)		18,827
Stock options exercised	4,815	$ 1		4,814
Stock options exercised (in shares)		142,978
Stock issued to directors	34			34
Stock issued to directors (in shares)		74
Return of common stock to pay withholding taxes on restricted stock	(2,069)		$ (2,069)
Return of common stock to pay withholding taxes on restricted stock (in shares)		(5,258)	5,258
Stock issued under employee stock purchase plan	1,376			1,376
Stock issued under employee stock purchase plan (in shares)		5,561
Stock compensation expense	15,934			15,934
Other comprehensive income (loss)	(622)					(622)
Net income	50,127				50,127
Ending Balance at Sep. 30, 2018	792,954	$ 450	$ (136,743)	660,132	280,650	(11,535)
Ending Balance (in shares) at Sep. 30, 2018		45,038,453	1,896,971
Restricted stock units issued		$ 1		(1)
Restricted stock units issued (in shares)		14,085
Stock options exercised	429			429
Stock options exercised (in shares)		10,039
Stock issued to directors	33			33
Stock issued to directors (in shares)		103
Return of common stock to pay withholding taxes on restricted stock	(1,546)		$ (1,546)
Return of common stock to pay withholding taxes on restricted stock (in shares)		(4,633)	4,633
Stock issued under employee stock purchase plan (in shares)		2
Stock compensation expense	15,578			15,578
Other comprehensive income (loss)	(781)					(781)
Net income	44,862				44,862
Ending Balance at Dec. 31, 2018	851,530	$ 451	$ (138,289)	676,171	325,513	(12,316)
Ending Balance (in shares) at Dec. 31, 2018		45,058,049	1,901,604
Beginning Balance at Mar. 31, 2019	$ 936,890	$ 451	$ (138,852)	690,507	399,473	(14,689)
Beginning Balance (in shares) at Mar. 31, 2019	45,122,985	45,122,985	1,903,241
Restricted stock units issued		$ 4		(4)
Restricted stock units issued (in shares)		373,430
Stock options exercised	$ 1,261	$ 1		1,260
Stock options exercised (in shares)		36,289
Return of common stock to pay withholding taxes on restricted stock	(40,536)	$ (2)	$ (40,534)
Return of common stock to pay withholding taxes on restricted stock (in shares)		(158,426)	158,426
Stock compensation expense	13,121			13,121
Other comprehensive income (loss)	2,934					2,934
Net income	88,923				88,923
Ending Balance at Jun. 30, 2019	1,002,593	$ 454	$ (179,386)	704,884	488,396	(11,755)
Ending Balance (in shares) at Jun. 30, 2019		45,374,278	2,061,667
Beginning Balance at Mar. 31, 2019	$ 936,890	$ 451	$ (138,852)	690,507	399,473	(14,689)
Beginning Balance (in shares) at Mar. 31, 2019	45,122,985	45,122,985	1,903,241
Stock options exercised (in shares)	65,000
Stock repurchase program	$ (59,900)
Stock repurchase program (in shares)	(318,361)
Other comprehensive income (loss)	$ (2,306)
Net income	171,211
Ending Balance at Dec. 31, 2019	$ 1,046,863	$ 451	$ (240,330)	733,054	570,683	(16,995)
Ending Balance (in shares) at Dec. 31, 2019	45,112,835	45,112,835	2,385,550
Beginning Balance at Jun. 30, 2019	$ 1,002,593	$ 454	$ (179,386)	704,884	488,396	(11,755)
Beginning Balance (in shares) at Jun. 30, 2019		45,374,278	2,061,667
Restricted stock units issued (in shares)		12,039
Stock options exercised	1,445			1,445
Stock options exercised (in shares)		21,268
Return of common stock to pay withholding taxes on restricted stock	(668)		$ (668)
Return of common stock to pay withholding taxes on restricted stock (in shares)		(3,363)	3,363
Stock issued under employee stock purchase plan	2,368			2,368
Stock issued under employee stock purchase plan (in shares)		15,659
Stock compensation expense	13,323			13,323
Stock repurchase program	(34,874)	$ (2)	$ (34,872)
Stock repurchase program (in shares)		180,929	(180,929)
Other comprehensive income (loss)	(5,801)					(5,801)
Net income	13,071				13,071
Ending Balance at Sep. 30, 2019	991,457	$ 452	$ (214,926)	722,020	501,467	(17,556)
Ending Balance (in shares) at Sep. 30, 2019		45,238,952	2,245,959
Restricted stock units issued (in shares)		6,004
Stock options exercised	460			460
Stock options exercised (in shares)		7,470
Return of common stock to pay withholding taxes on restricted stock	(403)		$ (403)
Return of common stock to pay withholding taxes on restricted stock (in shares)		(2,159)	2,159
Stock compensation expense	10,574			10,574
Stock repurchase program	$ (25,002)	$ (1)	$ (25,001)
Stock repurchase program (in shares)	(137,432)	137,432	(137,432)
Other comprehensive income (loss)	$ 561					561
Net income	69,217				69,217
Ending Balance at Dec. 31, 2019	$ 1,046,863	$ 451	$ (240,330)	$ 733,054	$ 570,683	$ (16,995)
Ending Balance (in shares) at Dec. 31, 2019	45,112,835	45,112,835	2,385,550

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2019	Mar. 31, 2019
Current assets:
Cash and cash equivalents	$ 117,970	$ 121,021
Short-term marketable securities	309,569	370,677
Accounts receivable, net	100,994	90,809
Inventories	91,193	80,942
Prepaid expenses and other current assets	16,850	13,748
Total current assets	636,576	677,197
Long-term marketable securities	167,981	21,718
Property and equipment, net	162,060	145,005
Goodwill	32,594	32,601
In-process research and development	15,205	15,208
Long-term deferred tax assets, net	47,028	77,502
Other assets	135,167	85,115
Total assets	1,196,611	1,054,346
Current liabilities:
Accounts payable	31,566	32,185
Accrued expenses	71,876	57,420
Deferred revenue	19,156	16,393
Other current liabilities	3,661
Total current liabilities	126,259	105,998
Contingent consideration	10,440	9,575
Long-term deferred tax liabilities	822	822
Other long-term liabilities	12,227	1,061
Total liabilities	149,748	117,456
Commitments and contingencies (Note 13)
Stockholders' equity:
Class B Preferred Stock, $.01 par value Authorized - 1,000,000 shares; Issued and outstanding - none
Common stock, $.01 par value Authorized - 100,000,000 shares; Issued - 47,498,385 shares at December 31, 2019 and 47,026,226 shares at March 31, 2019	451	451
Additional paid in capital	733,054	690,507
Retained earnings	570,683	399,473
Treasury stock at cost - 2,385,550 shares at December 31, 2019 and 1,903,241 shares at March 31, 2019	(240,330)	(138,852)
Accumulated other comprehensive loss	(16,995)	(14,689)
Total stockholders' equity	1,046,863	936,890
Total liabilities and stockholders' equity	$ 1,196,611	$ 1,054,346

Summary of Other Assets (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Sep. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Mar. 31, 2018
Other Assets [Abstract]
Equity method and other investments	$ 117,036	$ 81,836	$ 80,779	$ 40,784	$ 22,325	$ 12,649
Right of use asset - leases	11,455
Other intangible assets and other assets	6,676		4,336
Total other assets	$ 135,167		$ 85,115

Investable Cash Equivalents and Marketable Securities (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Mar. 31, 2019
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	$ 533,362	$ 472,146
Gross Unrealized Gains	912	375
Gross Unrealized Losses	(50)	(37)
Fair Market Value	534,224	472,484
Repurchase Agreement
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	20,000	20,000
Fair Market Value	20,000	20,000
Money Market Funds
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	36,674	60,089
Fair Market Value	36,674	60,089
Commercial Paper \| Short-term Investments
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	39,903	56,780
Gross Unrealized Gains	9	16
Gross Unrealized Losses	(9)	(1)
Fair Market Value	39,903	56,795
U.S. Treasury mutual fund securities \| Short-term Investments
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	37,158	58,786
Gross Unrealized Gains	23	13
Gross Unrealized Losses		(12)
Fair Market Value	37,181	58,787
U.S. Treasury mutual fund securities \| Long-term Investments
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	10,086
Gross Unrealized Gains	2
Fair Market Value	10,088
Government-backed securities \| Short-term Investments
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	108,117	126,336
Gross Unrealized Gains	121	60
Gross Unrealized Losses	(11)	(15)
Fair Market Value	108,227	126,381
Government-backed securities \| Long-term Investments
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	71,963
Gross Unrealized Gains	46
Gross Unrealized Losses	(26)
Fair Market Value	71,983
Corporate Debt Securities \| Short-term Investments
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	124,113	128,626
Gross Unrealized Gains	149	97
Gross Unrealized Losses	(4)	(9)
Fair Market Value	124,258	128,714
Corporate Debt Securities \| Long-term Investments
Total Cash Equivalents and Marketable Securities [Line Items]
Amortized Cost	85,348	21,529
Gross Unrealized Gains	562	189
Fair Market Value	$ 85,910	$ 21,718

Summary of Stock Option Activity (Detail) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended	12 Months Ended
	Dec. 31, 2019 USD ($) $ / shares shares	Mar. 31, 2019 $ / shares shares
Options
Outstanding at beginning of period \| shares	853
Granted \| shares	117
Exercised \| shares	(65)
Cancelled and expired \| shares	(14)
Outstanding at end of period \| shares	891	853
Exercisable at end of period \| shares	668
Options vested and expected to vest at end of period \| shares	888
Weighted Average Exercise Price
Outstanding at beginning of period \| $ / shares	$ 87.14
Granted \| $ / shares	259.52
Exercised \| $ / shares	48.67
Cancelled and expired \| $ / shares	235.87
Outstanding at end of period \| $ / shares	110.27	$ 87.14
Exercisable at end of period \| $ / shares	62.60
Options vested and expected to vest at end of period \| $ / shares	$ 110.28
Weighted Average Remaining Contractual Term (years)
Outstanding	5 years 5 months 15 days	5 years 6 months 25 days
Exercisable at end of period	4 years 4 months 20 days
Options vested and expected to vest at end of period	5 years 5 months 15 days
Aggregate Intrinsic Value
Outstanding at end of period \| $	$ 79,843
Exercisable at end of period \| $	77,717
Options vested and expected to vest at end of period \| $	$ 79,672

Minimum Future Lease Payments (Detail) $ in Thousands	Mar. 31, 2019 USD ($)
Leases [Abstract]
2020	$ 3,398
2021	2,712
2022	2,000
2023	1,462
2024	1,414
Thereafter	3,288
Total minimum lease payments	$ 14,274

Computation of Basic and Diluted Net Income Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended						9 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2019	Dec. 31, 2018
Basic Net Income Per Share
Net income	$ 69,217	$ 13,071	$ 88,923	$ 44,862	$ 50,127	$ 90,066	$ 171,211	$ 185,056
Weighted average shares - basic	45,140			45,046			45,225	44,852
Net income per share - basic	$ 1.53			$ 1.00			$ 3.79	$ 4.13
Diluted Net Income Per Share
Net income	$ 69,217	$ 13,071	$ 88,923	$ 44,862	$ 50,127	$ 90,066	$ 171,211	$ 185,056
Weighted average shares - basic	45,140			45,046			45,225	44,852
Effect of dilutive securities	555			1,090			710	1,295
Weighted average shares - diluted	45,695			46,136			45,935	46,147
Net income per share - diluted	$ 1.51			$ 0.97			$ 3.73	$ 4.01