|
þ
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the fiscal year ended December 31, 2018
|
|
OR
|
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from ________________ to ________________
|
Delaware
|
|
77-0629474
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
3000 Clearview Way
San Mateo, California |
|
94402
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Class A Common Stock, par value $0.0001
(Title of each class)
|
|
The Nasdaq Stock Market LLC
(Name of each exchange on which registered)
|
Large accelerated filer
þ
|
Accelerated filer ☐
|
Non-accelerated filer ☐
|
|
|
|
Smaller reporting company ☐
|
Emerging growth company ☐
|
|
|
|
|
Page
|
PART I
|
||
Item 1.
|
||
Item 1A.
|
||
Item 1B.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
|
|
PART II
|
||
Item 5.
|
||
Item 6.
|
||
Item 7.
|
||
Item 7A.
|
||
Item 8.
|
||
Item 9.
|
||
Item 9A.
|
||
Item 9B.
|
||
|
|
|
PART III
|
||
Item 10.
|
||
Item 11.
|
||
Item 12.
|
||
Item 13.
|
||
Item 14.
|
||
|
|
|
PART IV
|
||
Item 15.
|
||
Item 16.
|
||
|
•
|
HERO7
is our cloud-connected line of durable, waterproof cameras launched in the Fall of 2018, featuring image stabilization, telemetry, cloud connectivity and voice control. Our HERO7 Black camera features HyperSmooth image stabilization, which makes it easy to capture professional-looking gimbal-like stabilized videos without a gimbal, TimeWarp Video, which applies a high-speed, ‘magic-carpet-ride’ effect to videos, live streaming, which enables users to share content in real time to Facebook, Twitch, YouTube, Vimeo and other platforms internationally, and improved audio. Our HERO7 Black camera is powered by GoPro’s custom-designed GP1 processor and is the most powerful and performance featured GoPro camera to date. We also began shipping our HERO7 Silver and HERO7 White cameras in 2018, which feature advanced stabilization, cloud connectivity, voice control and a touch display. We offer many professional-grade features with our current good-better-best camera offering with HERO7 White, HERO7 Silver and HERO7 Black cameras. Our cameras are compatible with our ecosystem of mountable and wearable accessories, and feature automatic uploading capabilities for photos and videos to GoPro Plus, our premium cloud-based storage solution.
|
•
|
Fusion
is our 360-degree waterproof spherical camera which can shoot in 5.2K at 30 frames per second and features time lapse modes. Additionally, our latest firmware update enabled Fusion to also shoot in 5.8K at 24 frames per second for film and television production professionals. Using our GoPro App, a mobile user can preview live shots, stitch, trim and share content directly from their mobile device. The GoPro App’s OverCapture feature allows the user to re-frame and save traditional fixed-perspective videos “punched out” or extracted from a 360-degree video source file.
|
•
|
GoPro Plus
is our premium cloud-based storage solution that enables subscribers to easily access, edit and share content. GoPro Plus includes unlimited cloud storage supporting source video and photo quality. The subscription service also includes discounts on accessories and in the United States, camera replacement and damage protection. All of our HERO5 and newer cameras can automatically upload new photos and videos to a subscriber’s GoPro Plus account at the highest possible quality.
|
•
|
Quik
is our primary mobile editing app
that makes it simple to create stunning edits on a smartphone. Our Quik desktop app provides expanded editing options for power users.
|
•
|
GoPro App
is a mobile app that allows users to preview and play back photos and videos, control their GoPro cameras and share content on the fly using their smartphones. Included in the GoPro App is GoPro QuikStories, a mobile experience that seamlessly copies a user’s GoPro photos and video clips to his or her smartphone and transforms them into a ready-to-share video. GoPro QuikStories makes it simple to automatically create shareable video edits complete with music, effects and transitions.
|
•
|
Karma Grip
is a handheld or body-mountable camera stabilizer that makes it easy to capture zero-shake, smooth video.
|
•
|
difficulties in staffing and managing foreign operations;
|
•
|
burdens of complying with a wide variety of laws and regulations, including environmental, packaging and labeling;
|
•
|
adverse tax effects and foreign exchange controls making it difficult to repatriate earnings and cash;
|
•
|
changes to the taxation of undistributed foreign earnings;
|
•
|
the effect of foreign currency exchange rates and interest rates;
|
•
|
political and economic instability;
|
•
|
terrorist activities and natural disasters;
|
•
|
trade restrictions;
|
•
|
differing employment practices and laws and labor disruptions;
|
•
|
the imposition of government controls;
|
•
|
lesser degrees of intellectual property protection;
|
•
|
tariffs and customs duties and the classifications of our goods by applicable governmental bodies;
|
•
|
a legal system subject to undue influence or corruption; and
|
•
|
a business culture in which illegal sales practices may be prevalent.
|
•
|
our board of directors is not currently classified, but at such time as all shares of our Class B common stock have been converted into shares of our Class A common stock, our board of directors will be classified into three classes of directors with staggered three-year terms;
|
•
|
so long as any shares of our Class B common stock are outstanding, special meetings of our stockholders may be called by the holders of 10% of the outstanding voting power of all then outstanding shares of stock, a majority of our board of directors, the chairman of our board of directors or our chief executive officer;
|
•
|
when no shares of our Class B common stock are outstanding, only the chairman of our board of directors, our chief executive officer or a majority of our board of directors will be authorized to call a special meeting of stockholders;
|
•
|
our stockholders may only take action at a meeting of stockholders and not by written consent;
|
•
|
vacancies on our board of directors may be filled only by our board of directors and not by stockholders;
|
•
|
directors may be removed from office with or without cause so long as our board of directors is not classified, and thereafter directors may be removed from office only for cause;
|
•
|
our restated certificate of incorporation provides for a dual class common stock structure in which holders of our Class B common stock have the ability to control the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the outstanding shares of our Class A and Class B common stock, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets;
|
•
|
our restated certificate of incorporation authorizes undesignated preferred stock, the terms of which may be established, and shares of which may be issued, by our board of directors without stockholder approval and which may contain voting, liquidation, dividend and other rights superior to those of our Class A and Class B common stock; and
|
•
|
advance notice procedures apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders.
|
•
|
heighten our vulnerability to adverse general economic conditions and heightened competitive pressures;
|
•
|
require us to dedicate a larger portion of our cash flow from operations to interest payments, limiting the availability of cash for other purposes;
|
•
|
limit our flexibility in planning for, or reacting to, changes in our business and industry; and
|
•
|
impair our ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions, general corporate purposes or other purposes.
|
|
Year ended December 31,
|
||||||||||||||||||
(dollars in thousands, except per share amounts)
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Consolidated statements of operations data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
$
|
1,148,337
|
|
|
$
|
1,179,741
|
|
|
$
|
1,185,481
|
|
|
$
|
1,619,971
|
|
|
$
|
1,394,205
|
|
Gross profit
|
$
|
361,434
|
|
|
$
|
384,530
|
|
|
$
|
461,920
|
|
|
$
|
673,214
|
|
|
$
|
627,235
|
|
Gross margin
|
31.5
|
%
|
|
32.6
|
%
|
|
39.0
|
%
|
|
41.6
|
%
|
|
45.0
|
%
|
|||||
Operating income (loss)
|
$
|
(93,962
|
)
|
|
$
|
(163,460
|
)
|
|
$
|
(372,969
|
)
|
|
$
|
54,748
|
|
|
$
|
187,035
|
|
Net income (loss)
|
$
|
(109,034
|
)
|
|
$
|
(182,873
|
)
|
|
$
|
(419,003
|
)
|
|
$
|
36,131
|
|
|
$
|
128,088
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
(0.78
|
)
|
|
$
|
(1.32
|
)
|
|
$
|
(3.01
|
)
|
|
$
|
0.27
|
|
|
$
|
1.07
|
|
Diluted
|
$
|
(0.78
|
)
|
|
$
|
(1.32
|
)
|
|
$
|
(3.01
|
)
|
|
$
|
0.25
|
|
|
$
|
0.92
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other financial information:
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
(1)
|
$
|
21,778
|
|
|
$
|
(31,368
|
)
|
|
$
|
(192,807
|
)
|
|
$
|
179,309
|
|
|
$
|
293,380
|
|
Non-GAAP net income (loss)
(2)
|
$
|
(31,909
|
)
|
|
$
|
(95,867
|
)
|
|
$
|
(201,247
|
)
|
|
$
|
111,564
|
|
|
$
|
188,913
|
|
Non-GAAP diluted income (loss) per share
(2)
|
$
|
(0.23
|
)
|
|
$
|
(0.69
|
)
|
|
$
|
(1.44
|
)
|
|
$
|
0.76
|
|
|
$
|
1.32
|
|
(1)
|
We define adjusted EBITDA as net income (loss) adjusted to exclude the impact of: provision for income taxes, interest income, interest expense, depreciation and amortization, point of purchase (POP) display amortization, stock-based compensation, impairment charges and restructuring costs.
|
(2)
|
We define non-GAAP net income as net income (loss) adjusted to exclude stock-based compensation, acquisition-related costs, restructuring costs, non-cash interest expense, gain on sale and license of intellectual property and income tax adjustments. Acquisition-related costs include the amortization of acquired intangible assets and impairment write-downs (if applicable), as well as third-party transaction costs for legal and other professional services. Non-GAAP income (loss) per share considers the conversion of the redeemable convertible preferred stock into shares of common stock as though the conversion had occurred at the beginning of the period, and the initial public offering shares issued in July 2014 to be outstanding since the beginning of 2014.
|
|
As of December 31,
|
||||||||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Consolidated balance sheet data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents and marketable securities
|
$
|
197,512
|
|
|
$
|
247,390
|
|
|
$
|
217,953
|
|
|
$
|
474,058
|
|
|
$
|
422,256
|
|
Inventory
|
116,458
|
|
|
150,551
|
|
|
167,192
|
|
|
188,232
|
|
|
153,026
|
|
|||||
Working capital
|
174,574
|
|
|
203,156
|
|
|
157,074
|
|
|
538,066
|
|
|
564,274
|
|
|||||
Total assets
|
698,359
|
|
|
850,246
|
|
|
922,640
|
|
|
1,102,976
|
|
|
917,691
|
|
|||||
Total indebtedness
|
138,992
|
|
|
130,048
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total stockholders’ equity
|
212,112
|
|
|
298,705
|
|
|
446,945
|
|
|
772,033
|
|
|
641,204
|
|
•
|
Overview.
Discussion of our business and overall analysis of financial and other highlights affecting the Company in order to provide context for the remainder of MD&A.
|
•
|
Components of Our Results of Operations.
Description of the items contained in each operating revenue and expense caption in the consolidated statements of operations.
|
•
|
Results of Operations.
Analysis of our financial results comparing
2018
to
2017
and
2017
to
2016
.
|
•
|
Liquidity and Capital Resources.
Analysis of changes in our balance sheets and cash flows, and discussion of our financial condition and potential sources of liquidity.
|
•
|
Contractual Commitments.
Overview of our contractual obligations, including expected payment schedule and indemnifications as of
December 31, 2018
.
|
•
|
Critical Accounting Policies and Estimates.
Accounting estimates that we believe are important to understanding the assumptions and judgments incorporated in our reported financial results and forecasts.
|
•
|
Non-GAAP Financial Measures.
A reconciliation and discussion of our GAAP to non-GAAP financial measures.
|
(units and dollars in thousands, except per share amounts)
|
Q4 2018
|
|
Q4 2017
|
|
% Change
|
|
FY 2018
|
|
FY 2017
|
|
% Change
|
||||||||||
Revenue
|
$
|
377,378
|
|
|
$
|
334,796
|
|
|
13
|
%
|
|
$
|
1,148,337
|
|
|
$
|
1,179,741
|
|
|
(3
|
)%
|
Camera units shipped
(1)
|
1,413
|
|
|
1,361
|
|
|
4
|
%
|
|
4,337
|
|
|
4,303
|
|
|
1
|
%
|
||||
Gross margin
(2)
|
37.7
|
%
|
|
23.8
|
%
|
|
1390 bps
|
|
|
31.5
|
%
|
|
32.6
|
%
|
|
(110) bps
|
|
||||
Operating expenses
|
$
|
109,150
|
|
|
$
|
138,097
|
|
|
(21
|
)%
|
|
$
|
455,396
|
|
|
$
|
547,990
|
|
|
(17
|
)%
|
Net income (loss)
|
$
|
31,671
|
|
|
$
|
(55,848
|
)
|
|
(157
|
)%
|
|
$
|
(109,034
|
)
|
|
$
|
(182,873
|
)
|
|
(40
|
)%
|
Diluted net income (loss) per share
|
$
|
0.22
|
|
|
$
|
(0.41
|
)
|
|
(154
|
)%
|
|
$
|
(0.78
|
)
|
|
$
|
(1.32
|
)
|
|
(41
|
)%
|
Cash provided by (used) in operations
|
$
|
48,413
|
|
|
$
|
56,990
|
|
|
(15
|
)%
|
|
$
|
(42,434
|
)
|
|
$
|
(36,853
|
)
|
|
15
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other financial information:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
(3)
|
$
|
58,807
|
|
|
$
|
(26,544
|
)
|
|
(322
|
)%
|
|
$
|
21,778
|
|
|
$
|
(31,368
|
)
|
|
(169
|
)%
|
Non-GAAP net income (loss)
(4)
|
$
|
42,356
|
|
|
$
|
(41,319
|
)
|
|
(203
|
)%
|
|
$
|
(31,909
|
)
|
|
$
|
(95,867
|
)
|
|
(67
|
)%
|
Non-GAAP income (loss) per share
|
$
|
0.30
|
|
|
$
|
(0.30
|
)
|
|
(200
|
)%
|
|
$
|
(0.23
|
)
|
|
$
|
(0.69
|
)
|
|
(67
|
)%
|
(1)
|
Represents the number of camera units that are shipped during a reporting period, including camera units that are shipped with drones, net of any returns. Camera units shipped does not include drones sold without a camera, mounts or accessories.
|
(2)
|
One basis point (bps) is equal to 1/100th of 1%.
|
(3)
|
We define adjusted EBITDA as net income (loss) adjusted to exclude the impact of: provision for income taxes, interest income, interest expense, depreciation and amortization, point of purchase (POP) display amortization, stock-based compensation, impairment charges and restructuring costs.
|
(4)
|
We define non-GAAP net income (loss) as net income (loss) adjusted to exclude stock-based compensation, acquisition-related costs, restructuring costs, non-cash interest expense, gain on sale and license of intellectual property and income tax adjustments. Acquisition-related costs include the amortization of acquired intangible assets and impairment write-downs (if applicable), as well as third-party transaction costs for legal and other professional services.
|
|
Year ended December 31,
|
|||||||||||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
Revenue
|
$
|
1,148,337
|
|
|
100
|
%
|
|
$
|
1,179,741
|
|
|
100
|
%
|
|
$
|
1,185,481
|
|
|
100
|
%
|
Cost of revenue
|
786,903
|
|
|
69
|
|
|
795,211
|
|
|
67
|
|
|
723,561
|
|
|
61
|
|
|||
Gross profit
|
361,434
|
|
|
31
|
|
|
384,530
|
|
|
33
|
|
|
461,920
|
|
|
39
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Research and development
|
167,296
|
|
|
15
|
|
|
229,265
|
|
|
19
|
|
|
358,902
|
|
|
30
|
|
|||
Sales and marketing
|
222,096
|
|
|
19
|
|
|
236,581
|
|
|
20
|
|
|
368,620
|
|
|
31
|
|
|||
General and administrative
|
66,004
|
|
|
6
|
|
|
82,144
|
|
|
7
|
|
|
107,367
|
|
|
9
|
|
|||
Total operating expenses
|
455,396
|
|
|
40
|
|
|
547,990
|
|
|
46
|
|
|
834,889
|
|
|
70
|
|
|||
Operating loss
|
(93,962
|
)
|
|
(9
|
)
|
|
(163,460
|
)
|
|
(13
|
)
|
|
(372,969
|
)
|
|
(31
|
)
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Interest expense
|
(18,683
|
)
|
|
(1
|
)
|
|
(13,660
|
)
|
|
(1
|
)
|
|
(2,992
|
)
|
|
—
|
|
|||
Other income, net
|
4,970
|
|
|
—
|
|
|
733
|
|
|
—
|
|
|
787
|
|
|
—
|
|
|||
Total other expense, net
|
(13,713
|
)
|
|
(1
|
)
|
|
(12,927
|
)
|
|
(1
|
)
|
|
(2,205
|
)
|
|
—
|
|
|||
Loss before income taxes
|
(107,675
|
)
|
|
(10
|
)
|
|
(176,387
|
)
|
|
(14
|
)
|
|
(375,174
|
)
|
|
(31
|
)
|
|||
Income tax expense
|
1,359
|
|
|
—
|
|
|
6,486
|
|
|
1
|
|
|
43,829
|
|
|
4
|
|
|||
Net loss
|
$
|
(109,034
|
)
|
|
(10
|
)%
|
|
$
|
(182,873
|
)
|
|
(15
|
)%
|
|
$
|
(419,003
|
)
|
|
(35
|
)%
|
|
Year ended December 31,
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||||
(camera units and dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|
% Change
|
|
% Change
|
||||||||
Camera units shipped
|
4,337
|
|
|
4,303
|
|
|
4,762
|
|
|
1
|
%
|
|
(10
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||||
Direct channel
|
$
|
551,095
|
|
|
$
|
634,888
|
|
|
$
|
650,111
|
|
|
(13
|
)
|
|
(2
|
)
|
Percentage of revenue
|
48.0
|
%
|
|
53.8
|
%
|
|
54.8
|
%
|
|
|
|
|
|||||
Distribution channel
|
$
|
597,242
|
|
|
$
|
544,853
|
|
|
$
|
535,370
|
|
|
10
|
|
|
2
|
|
Percentage of revenue
|
52.0
|
%
|
|
46.2
|
%
|
|
45.2
|
%
|
|
|
|
|
|||||
Total revenue
|
$
|
1,148,337
|
|
|
$
|
1,179,741
|
|
|
$
|
1,185,481
|
|
|
(3
|
)%
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||||
Americas
|
$
|
498,633
|
|
|
$
|
591,879
|
|
|
$
|
619,784
|
|
|
(16
|
)%
|
|
(5
|
)%
|
Percentage of revenue
|
43.4
|
%
|
|
50.2
|
%
|
|
52.3
|
%
|
|
|
|
|
|||||
Europe, Middle East and Africa (EMEA)
|
$
|
366,037
|
|
|
$
|
334,872
|
|
|
$
|
366,352
|
|
|
9
|
|
|
(9
|
)
|
Percentage of revenue
|
31.8
|
%
|
|
28.4
|
%
|
|
30.9
|
%
|
|
|
|
|
|||||
Asia and Pacific (APAC)
|
$
|
283,667
|
|
|
$
|
252,990
|
|
|
$
|
199,345
|
|
|
12
|
|
|
27
|
|
Percentage of revenue
|
24.7
|
%
|
|
21.4
|
%
|
|
16.8
|
%
|
|
|
|
|
|||||
Total revenue
|
$
|
1,148,337
|
|
|
$
|
1,179,741
|
|
|
$
|
1,185,481
|
|
|
(3
|
)%
|
|
—
|
%
|
|
Year ended December 31,
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|
% Change
|
|
% Change
|
||||||||
Cost of revenue
|
$
|
772,136
|
|
|
$
|
786,657
|
|
|
$
|
719,689
|
|
|
(2
|
)%
|
|
9
|
%
|
Stock-based compensation
|
1,954
|
|
|
1,935
|
|
|
1,616
|
|
|
1
|
|
|
20
|
|
|||
Acquisition-related costs
|
11,434
|
|
|
5,985
|
|
|
1,759
|
|
|
91
|
|
|
240
|
|
|||
Restructuring costs
|
1,379
|
|
|
634
|
|
|
497
|
|
|
118
|
|
|
28
|
|
|||
Total cost of revenue
|
$
|
786,903
|
|
|
$
|
795,211
|
|
|
$
|
723,561
|
|
|
(1
|
)%
|
|
10
|
%
|
Gross margin
|
31.5
|
%
|
|
32.6
|
%
|
|
39.0
|
%
|
|
(110) bps
|
|
|
(640) bps
|
|
|
Year ended December 31,
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|
% Change
|
|
% Change
|
||||||||
Research and development
|
$
|
134,866
|
|
|
$
|
191,182
|
|
|
$
|
295,901
|
|
|
(29
|
)%
|
|
(35
|
)%
|
Stock-based compensation
|
19,636
|
|
|
24,963
|
|
|
31,365
|
|
|
(21
|
)
|
|
(20
|
)
|
|||
Acquisition-related costs
|
—
|
|
|
3,028
|
|
|
14,439
|
|
|
(100
|
)
|
|
(79
|
)
|
|||
Restructuring costs
|
12,794
|
|
|
10,092
|
|
|
17,197
|
|
|
27
|
|
|
(41
|
)
|
|||
Total research and development
|
$
|
167,296
|
|
|
$
|
229,265
|
|
|
$
|
358,902
|
|
|
(27
|
)%
|
|
(36
|
)%
|
Percentage of revenue
|
14.6
|
%
|
|
19.4
|
%
|
|
30.3
|
%
|
|
|
|
|
|
Year ended December 31,
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|
% Change
|
|
% Change
|
||||||||
Sales and marketing
|
$
|
207,346
|
|
|
$
|
219,036
|
|
|
$
|
342,651
|
|
|
(5
|
)%
|
|
(36
|
)%
|
Stock-based compensation
|
9,459
|
|
|
10,498
|
|
|
13,883
|
|
|
(10
|
)
|
|
(24
|
)
|
|||
Acquisition-related costs
|
—
|
|
|
—
|
|
|
22
|
|
|
—
|
|
|
(100
|
)
|
|||
Restructuring costs
|
5,291
|
|
|
7,047
|
|
|
12,064
|
|
|
(25
|
)
|
|
(42
|
)
|
|||
Total sales and marketing
|
$
|
222,096
|
|
|
$
|
236,581
|
|
|
$
|
368,620
|
|
|
(6
|
)%
|
|
(36
|
)%
|
Percentage of revenue
|
19.3
|
%
|
|
20.1
|
%
|
|
31.1
|
%
|
|
|
|
|
|
Year ended December 31,
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|
% Change
|
|
% Change
|
||||||||
General and administrative
|
$
|
52,865
|
|
|
$
|
65,788
|
|
|
$
|
70,247
|
|
|
(20
|
)%
|
|
(6
|
)%
|
Stock-based compensation
|
9,838
|
|
|
13,859
|
|
|
22,663
|
|
|
(29
|
)
|
|
(39
|
)
|
|||
Acquisition-related costs
|
22
|
|
|
(22
|
)
|
|
1,126
|
|
|
(200
|
)
|
|
(102
|
)
|
|||
Restructuring costs
|
3,279
|
|
|
2,519
|
|
|
13,331
|
|
|
30
|
|
|
(81
|
)
|
|||
Total general and administrative
|
$
|
66,004
|
|
|
$
|
82,144
|
|
|
$
|
107,367
|
|
|
(20
|
)%
|
|
(23
|
)%
|
Percentage of revenue
|
5.7
|
%
|
|
7.0
|
%
|
|
9.1
|
%
|
|
|
|
|
|
Year ended December 31,
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|
% Change
|
|
% Change
|
||||||||
Interest expense
|
$
|
(18,683
|
)
|
|
$
|
(13,660
|
)
|
|
$
|
(2,992
|
)
|
|
37
|
%
|
|
357
|
%
|
Other income, net
|
4,970
|
|
|
733
|
|
|
787
|
|
|
578
|
|
|
(7
|
)
|
|||
Total other expense, net
|
$
|
(13,713
|
)
|
|
$
|
(12,927
|
)
|
|
$
|
(2,205
|
)
|
|
6
|
%
|
|
486
|
%
|
|
Year ended December 31,
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||||
(dollars in thousands)
|
2018
|
|
2017
|
|
2016
|
|
% Change
|
|
% Change
|
||||||||
Income tax expense
|
$
|
1,359
|
|
|
$
|
6,486
|
|
|
$
|
43,829
|
|
|
(79
|
)%
|
|
(85
|
)%
|
Effective tax rate
|
(1.3
|
)%
|
|
(3.7
|
)%
|
|
(11.7
|
)%
|
|
|
|
|
|
Three months ended
|
||||||||||||||||||||||||||||||
(dollars in thousands, except per share amounts)
|
Dec. 31,
2018
|
|
Sept. 30,
2018 |
|
June 30,
2018
|
|
March 31,
2018 |
|
Dec. 31,
2017
|
|
Sept. 30,
2017 |
|
June 30,
2017
|
|
March 31,
2017 |
||||||||||||||||
Revenue
(1)
|
$
|
377,378
|
|
|
$
|
285,936
|
|
|
$
|
282,677
|
|
|
$
|
202,346
|
|
|
$
|
334,796
|
|
|
$
|
329,805
|
|
|
$
|
296,526
|
|
|
$
|
218,614
|
|
Gross profit
|
142,117
|
|
|
91,032
|
|
|
83,369
|
|
|
44,916
|
|
|
79,786
|
|
|
130,546
|
|
|
105,632
|
|
|
68,566
|
|
||||||||
Operating expenses
(2)
|
109,150
|
|
|
112,386
|
|
|
114,205
|
|
|
119,655
|
|
|
138,097
|
|
|
122,497
|
|
|
130,615
|
|
|
156,781
|
|
||||||||
Net income (loss)
|
$
|
31,671
|
|
|
$
|
(27,089
|
)
|
|
$
|
(37,269
|
)
|
|
$
|
(76,347
|
)
|
|
$
|
(55,848
|
)
|
|
$
|
14,661
|
|
|
$
|
(30,536
|
)
|
|
$
|
(111,150
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic
|
$
|
0.22
|
|
|
$
|
(0.19
|
)
|
|
$
|
(0.27
|
)
|
|
$
|
(0.55
|
)
|
|
$
|
(0.41
|
)
|
|
$
|
0.11
|
|
|
$
|
(0.22
|
)
|
|
$
|
(0.78
|
)
|
Diluted
|
$
|
0.22
|
|
|
$
|
(0.19
|
)
|
|
$
|
(0.27
|
)
|
|
$
|
(0.55
|
)
|
|
$
|
(0.41
|
)
|
|
$
|
0.10
|
|
|
$
|
(0.22
|
)
|
|
$
|
(0.78
|
)
|
(1)
|
Included in revenue for the quarter ended December 31, 2017 was a reduction of $80.5 million for price protection and marketing development funds incurred in connection with the reduction of our camera and drone selling prices.
|
(2)
|
Included in operating expenses were the restructuring charges of $3.9 million for the quarter ended September 30, 2018, $15.5 million for the quarter ended March 31, 2018 and $12.1 million for the quarter ended March 31, 2017.
|
(dollars in thousands)
|
December 31, 2018
|
|
December 31, 2017
|
||||
Cash and cash equivalents
|
$
|
152,095
|
|
|
$
|
202,504
|
|
Marketable securities
|
45,417
|
|
|
44,886
|
|
||
Total cash, cash equivalents and marketable securities
|
$
|
197,512
|
|
|
$
|
247,390
|
|
Percentage of total assets
|
28
|
%
|
|
29
|
%
|
•
|
We expect that operating expenses and inventory purchases will constitute a material use of our cash balances. We intend to continue to manage our operating activities in line with our existing cash and available financial resources.
|
•
|
In March 2016, we entered into a credit agreement with a syndicate of banks that provided for a secured revolving credit facility under which we could borrow up to an aggregate of
$250.0 million
. Our credit facility terminates in March 2021. No borrowings have been made from the credit facility to date. (See Note
5
Financing Arrangements
, in the Notes to Consolidated Financial Statements for additional information.)
|
•
|
We have completed acquisitions in the past and we may evaluate additional possible acquisitions of, or strategic investments in, businesses, products and technologies that are complementary to our business, which may require the use of cash.
|
|
Year ended December 31,
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|
% Change
|
|
% Change
|
||||||||
Net cash provided by (used in):
|
|
|
|
|
|
|
|
|
|
|
|||||||
Operating activities
|
$
|
(42,434
|
)
|
|
$
|
(36,853
|
)
|
|
$
|
(107,753
|
)
|
|
15
|
%
|
|
(66
|
)%
|
Investing activities
|
$
|
(6,235
|
)
|
|
$
|
(43,097
|
)
|
|
$
|
19,286
|
|
|
(86
|
)%
|
|
(323
|
)%
|
Financing activities
|
$
|
(1,481
|
)
|
|
$
|
88,594
|
|
|
$
|
1,955
|
|
|
(102
|
)%
|
|
4,432
|
%
|
•
|
Expected Term.
We do not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term due to the limited period of time stock-based awards have been exercisable since the completion of our IPO in July 2014. As a result, we used the simplified method to calculate the expected term estimate based on the vesting and contractual terms of the option. Under the simplified method, the
|
•
|
Volatility.
The expected stock price volatility for our common stock was estimated by taking the average of our historic volatility and the historical volatility of the common stock of a group of comparable publicly traded companies over a period equivalent to the expected term.
|
•
|
the comparability of our on-going operating results over the periods presented;
|
•
|
the ability to identify trends in our underlying business; and
|
•
|
the comparison of our operating results against analyst financial models and operating results of other public companies that supplement their GAAP results with non-GAAP financial measures.
|
•
|
adjusted EBITDA does not reflect tax payments that reduce cash available to us;
|
•
|
adjusted EBITDA excludes depreciation and amortization and, although these are non-cash charges, the property and equipment being depreciated and amortized often will have to be replaced in the future, and adjusted EBITDA does not reflect any cash capital expenditure requirements for such replacements;
|
•
|
adjusted EBITDA excludes the amortization of POP display assets because it is a non-cash charge, and is treated similarly to depreciation of property and equipment and amortization of acquired intangible assets;
|
•
|
adjusted EBITDA and non-GAAP net income (loss) exclude the impairment of intangible assets because it is a non-cash charge that is inconsistent in amount and frequency;
|
•
|
adjusted EBITDA and non-GAAP net income (loss) exclude restructuring costs which primarily include severance-related costs, stock-based compensation expenses and facilities consolidation charges recorded in connection with restructuring actions announced in the first and fourth quarters of 2016, first quarter of 2017 and first quarter of 2018. These expenses do not reflect expected future operating expenses and do not contribute to a meaningful evaluation of current operating performance or comparisons to the operating performance in other periods;
|
•
|
adjusted EBITDA and non-GAAP net income (loss) exclude stock-based compensation expense related to equity awards granted primarily to our workforce. We exclude stock-based compensation expense because we believe that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding operational performance. In particular, we note that companies calculate stock-based compensation expense for the variety of award types that they employ using different valuation methodologies and subjective assumptions. These non-cash charges are not factored into our internal evaluation of net income (loss) as we believe their inclusion would hinder our ability to assess core operational performance;
|
•
|
non-GAAP net income (loss) excludes acquisition-related costs including the amortization of acquired intangible assets (primarily consisting of acquired technology), the impairment of acquired intangible assets (if applicable), as well as third-party transaction costs incurred for legal and other professional services. These costs are not factored into our evaluation of potential acquisitions, or of our performance after completion of the acquisitions, because these costs are not related to our core operating performance or reflective of ongoing operating results in the period, and the frequency and amount of such costs are inconsistent and vary significantly based on the timing and magnitude of our acquisition transactions and the maturities of the businesses being acquired;
|
•
|
non-GAAP net income (loss) excludes non-cash interest expense. In connection with the issuance of the Convertible Senior Notes in April 2017, we are required to recognize non-cash interest expense in accordance with the authoritative accounting guidance for convertible debt that may be settled in cash;
|
•
|
non-GAAP net income (loss) excludes a gain on the sale and license of intellectual property. This gain is not related to our core operating performance or reflective of ongoing operating results in the period, and the frequency and amount of such gains are inconsistent;
|
•
|
non-GAAP net income (loss) includes income tax adjustments. Beginning in the first quarter of 2017, we implemented a cash-based non-GAAP tax expense approach (based upon expected annual cash payments for income taxes) for evaluating operating performance as well as for planning and forecasting purposes. This non-GAAP tax approach eliminates the effects of period specific items, which can vary in size and frequency and does not necessarily reflect our long-term operations. Historically, we computed a non-GAAP tax rate based on non-GAAP pre-tax income on a quarterly basis, which considered the income tax effects of the adjustments above; and
|
•
|
other companies may calculate these non-GAAP financial measures differently than we do, limiting their usefulness as comparative measures.
|
|
Three months ended December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Net income (loss)
|
$
|
31,671
|
|
|
$
|
(55,848
|
)
|
Income tax (benefit) expense
|
1,655
|
|
|
(6,943
|
)
|
||
Interest expense, net
|
4,470
|
|
|
4,163
|
|
||
Depreciation and amortization
|
7,290
|
|
|
9,218
|
|
||
POP display amortization
|
2,788
|
|
|
4,342
|
|
||
Stock-based compensation
|
9,716
|
|
|
15,020
|
|
||
Restructuring costs
|
1,217
|
|
|
3,504
|
|
||
Adjusted EBITDA
|
$
|
58,807
|
|
|
$
|
(26,544
|
)
|
|
Year ended December 31,
|
||||||||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Net income (loss)
|
$
|
(109,034
|
)
|
|
$
|
(182,873
|
)
|
|
$
|
(419,003
|
)
|
|
$
|
36,131
|
|
|
$
|
128,088
|
|
Income tax expense
|
1,359
|
|
|
6,486
|
|
|
43,829
|
|
|
16,454
|
|
|
52,887
|
|
|||||
Interest expense
|
17,278
|
|
|
12,804
|
|
|
1,401
|
|
|
234
|
|
|
5,038
|
|
|||||
Depreciation and amortization
|
35,063
|
|
|
41,478
|
|
|
41,639
|
|
|
28,981
|
|
|
17,945
|
|
|||||
POP display amortization
|
13,482
|
|
|
19,190
|
|
|
19,623
|
|
|
16,829
|
|
|
18,023
|
|
|||||
Stock-based compensation
|
40,887
|
|
|
51,255
|
|
|
69,527
|
|
|
80,680
|
|
|
71,399
|
|
|||||
Impairment of intangible assets
|
—
|
|
|
—
|
|
|
7,088
|
|
|
—
|
|
|
—
|
|
|||||
Restructuring costs
|
22,743
|
|
|
20,292
|
|
|
43,089
|
|
|
—
|
|
|
—
|
|
|||||
Adjusted EBITDA
|
$
|
21,778
|
|
|
$
|
(31,368
|
)
|
|
$
|
(192,807
|
)
|
|
$
|
179,309
|
|
|
$
|
293,380
|
|
|
Three months ended December 31,
|
||||||
(in thousands, except per share data)
|
2018
|
|
2017
|
||||
Net income (loss)
|
$
|
31,671
|
|
|
$
|
(55,848
|
)
|
Stock-based compensation
|
9,716
|
|
|
15,020
|
|
||
Acquisition-related costs
|
2,101
|
|
|
2,360
|
|
||
Restructuring costs
|
1,217
|
|
|
3,504
|
|
||
Non-cash interest expense
|
2,124
|
|
|
1,979
|
|
||
Gain on sale and license of intellectual property
|
(5,000
|
)
|
|
—
|
|
||
Income tax adjustments
|
527
|
|
|
(8,334
|
)
|
||
Non-GAAP net income (loss)
|
$
|
42,356
|
|
|
$
|
(41,319
|
)
|
Non-GAAP income (loss) per share
|
$
|
0.30
|
|
|
$
|
(0.30
|
)
|
|
|
|
|
||||
GAAP shares for diluted net income (loss) per share
|
140,882
|
|
|
136,886
|
|
||
Add: effect of potentially dilutive shares
|
2,359
|
|
|
—
|
|
||
Non-GAAP shares for diluted net income (loss) per share
|
143,241
|
|
|
136,886
|
|
|
Year ended December 31,
|
||||||||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Net income (loss)
|
$
|
(109,034
|
)
|
|
$
|
(182,873
|
)
|
|
$
|
(419,003
|
)
|
|
$
|
36,131
|
|
|
$
|
128,088
|
|
Stock-based compensation
|
40,887
|
|
|
51,255
|
|
|
69,527
|
|
|
80,680
|
|
|
71,399
|
|
|||||
Acquisition-related costs
|
11,456
|
|
|
8,991
|
|
|
17,346
|
|
|
5,370
|
|
|
1,133
|
|
|||||
Restructuring costs
|
22,743
|
|
|
20,292
|
|
|
43,089
|
|
|
—
|
|
|
—
|
|
|||||
Non-cash interest expense
|
8,112
|
|
|
5,345
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Gain on sale and license of intellectual property
|
(5,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Income tax adjustments
(1)
|
(1,073
|
)
|
|
1,123
|
|
|
87,794
|
|
|
(10,617
|
)
|
|
(11,707
|
)
|
|||||
Non-GAAP net income (loss)
|
$
|
(31,909
|
)
|
|
$
|
(95,867
|
)
|
|
$
|
(201,247
|
)
|
|
$
|
111,564
|
|
|
$
|
188,913
|
|
Non-GAAP diluted income (loss) per share
|
$
|
(0.23
|
)
|
|
$
|
(0.69
|
)
|
|
$
|
(1.44
|
)
|
|
$
|
0.76
|
|
|
$
|
1.32
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
GAAP shares for diluted net income (loss) per share
|
139,495
|
|
|
138,056
|
|
|
139,425
|
|
|
146,486
|
|
|
123,630
|
|
|||||
Add: preferred shares conversion
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,136
|
|
|||||
Add: initial public offering shares
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,414
|
|
|||||
Non-GAAP shares for diluted net income (loss) per share
|
139,495
|
|
|
138,056
|
|
|
139,425
|
|
|
146,486
|
|
|
143,180
|
|
(1)
|
Beginning in the first quarter of 2017, we implemented a cash-based non-GAAP expense approach (based upon expected annual cash payments for income taxes) for evaluating operating performance as well as for planning and forecasting purposes. This non-GAAP approach eliminates the effects of period specific items, which can vary in size and frequency and does not necessarily reflect our long-term operations. Historically, we computed a non-GAAP tax rate based on non-GAAP pre-tax income on a quarterly basis, which considered the income tax effects of the adjustments above.
|
|
Page
|
(in thousands, except par values)
|
December 31, 2018
|
|
December 31, 2017
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
152,095
|
|
|
$
|
202,504
|
|
Marketable securities
|
45,417
|
|
|
44,886
|
|
||
Accounts receivable, net
|
129,216
|
|
|
112,935
|
|
||
Inventory
|
116,458
|
|
|
150,551
|
|
||
Prepaid expenses and other current assets
|
30,887
|
|
|
62,811
|
|
||
Total current assets
|
474,073
|
|
|
573,687
|
|
||
Property and equipment, net
|
46,567
|
|
|
68,587
|
|
||
Intangible assets, net
|
13,065
|
|
|
24,499
|
|
||
Goodwill
|
146,459
|
|
|
146,459
|
|
||
Other long-term assets
|
18,195
|
|
|
37,014
|
|
||
Total assets
|
$
|
698,359
|
|
|
$
|
850,246
|
|
|
|
|
|
||||
Liabilities and Stockholders’ Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
148,478
|
|
|
$
|
138,257
|
|
Accrued liabilities
|
135,892
|
|
|
213,030
|
|
||
Deferred revenue
|
15,129
|
|
|
19,244
|
|
||
Total current liabilities
|
299,499
|
|
|
370,531
|
|
||
Long-term taxes payable
|
19,553
|
|
|
21,188
|
|
||
Long-term debt
|
138,992
|
|
|
130,048
|
|
||
Other long-term liabilities
|
28,203
|
|
|
29,774
|
|
||
Total liabilities
|
486,247
|
|
|
551,541
|
|
||
|
|
|
|
||||
Commitments, contingencies and guarantees (Note 11)
|
|
|
|
|
|||
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $0.0001 par value, 5,000 shares authorized; none issued
|
—
|
|
|
—
|
|
||
Common stock and additional paid-in capital, $0.0001 par value, 500,000 Class A shares authorized, 105,170 and 101,034 shares issued and outstanding, respectively; 150,000 Class B shares authorized, 35,897 and 35,966 shares issued and outstanding, respectively
|
894,755
|
|
|
854,452
|
|
||
Treasury stock, at cost, 10,710 and 10,710 shares, respectively
|
(113,613
|
)
|
|
(113,613
|
)
|
||
Accumulated deficit
|
(569,030
|
)
|
|
(442,134
|
)
|
||
Total stockholders’ equity
|
212,112
|
|
|
298,705
|
|
||
Total liabilities and stockholders’ equity
|
$
|
698,359
|
|
|
$
|
850,246
|
|
|
Year ended December 31,
|
||||||||||
(in thousands, except per share data)
|
2018
|
|
2017
|
|
2016
|
||||||
Revenue
|
$
|
1,148,337
|
|
|
$
|
1,179,741
|
|
|
$
|
1,185,481
|
|
Cost of revenue
|
786,903
|
|
|
795,211
|
|
|
723,561
|
|
|||
Gross profit
|
361,434
|
|
|
384,530
|
|
|
461,920
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Research and development
|
167,296
|
|
|
229,265
|
|
|
358,902
|
|
|||
Sales and marketing
|
222,096
|
|
|
236,581
|
|
|
368,620
|
|
|||
General and administrative
|
66,004
|
|
|
82,144
|
|
|
107,367
|
|
|||
Total operating expenses
|
455,396
|
|
|
547,990
|
|
|
834,889
|
|
|||
Operating loss
|
(93,962
|
)
|
|
(163,460
|
)
|
|
(372,969
|
)
|
|||
Other income (expense):
|
|
|
|
|
|
||||||
Interest expense
|
(18,683
|
)
|
|
(13,660
|
)
|
|
(2,992
|
)
|
|||
Other income, net
|
4,970
|
|
|
733
|
|
|
787
|
|
|||
Total other expense, net
|
(13,713
|
)
|
|
(12,927
|
)
|
|
(2,205
|
)
|
|||
Loss before income taxes
|
(107,675
|
)
|
|
(176,387
|
)
|
|
(375,174
|
)
|
|||
Income tax expense
|
1,359
|
|
|
6,486
|
|
|
43,829
|
|
|||
Net loss
|
$
|
(109,034
|
)
|
|
$
|
(182,873
|
)
|
|
$
|
(419,003
|
)
|
|
|
|
|
|
|
||||||
Basic and diluted net loss per share
|
$
|
(0.78
|
)
|
|
$
|
(1.32
|
)
|
|
$
|
(3.01
|
)
|
|
|
|
|
|
|
||||||
Weighted average number of shares outstanding, basic and diluted
|
139,495
|
|
|
138,056
|
|
|
139,425
|
|
|
Common stock and additional paid-in capital
|
|
Treasury stock
|
|
Retained earnings (accumulated
deficit)
|
|
Stockholders’ equity
|
||||||||||
(in thousands)
|
Shares
|
Amount
|
|
Amount
|
|
|
|||||||||||
Balances at December 31, 2015
|
136,601
|
|
$
|
663,311
|
|
|
$
|
(35,613
|
)
|
|
$
|
144,335
|
|
|
$
|
772,033
|
|
Common stock issued under employee benefit plans, net of shares withheld for tax
|
3,936
|
|
10,103
|
|
|
—
|
|
|
—
|
|
|
10,103
|
|
||||
Taxes paid related to net share settlements
|
—
|
|
(6,889
|
)
|
|
—
|
|
|
—
|
|
|
(6,889
|
)
|
||||
Shares issued to third-party vendor for services
|
822
|
|
7,297
|
|
|
—
|
|
|
—
|
|
|
7,297
|
|
||||
Stock-based compensation expense
|
—
|
|
69,499
|
|
|
—
|
|
|
—
|
|
|
69,499
|
|
||||
Stock-based compensation expense related to restructuring
|
—
|
|
15,566
|
|
|
—
|
|
|
—
|
|
|
15,566
|
|
||||
Excess tax benefit from stock-based compensation
|
—
|
|
(1,661
|
)
|
|
—
|
|
|
—
|
|
|
(1,661
|
)
|
||||
Net loss
|
—
|
|
—
|
|
|
—
|
|
|
(419,003
|
)
|
|
(419,003
|
)
|
||||
Balances at December 31, 2016
|
141,359
|
|
757,226
|
|
|
(35,613
|
)
|
|
(274,668
|
)
|
|
446,945
|
|
||||
Common stock issued under employee benefit plans, net of shares withheld for tax
|
4,807
|
|
9,732
|
|
|
—
|
|
|
—
|
|
|
9,732
|
|
||||
Taxes paid related to net share settlements
|
—
|
|
(12,118
|
)
|
|
—
|
|
|
—
|
|
|
(12,118
|
)
|
||||
Stock-based compensation expense
|
—
|
|
54,037
|
|
|
—
|
|
|
—
|
|
|
54,037
|
|
||||
Repurchase of common stock under Prepaid Forward contract
|
(9,166
|
)
|
(1
|
)
|
|
(78,000
|
)
|
|
—
|
|
|
(78,001
|
)
|
||||
Issuance of Convertible Note
|
—
|
|
45,211
|
|
|
—
|
|
|
—
|
|
|
45,211
|
|
||||
Cumulative effect of adoption of new accounting standard
|
—
|
|
365
|
|
|
—
|
|
|
15,407
|
|
|
15,772
|
|
||||
Net loss
|
—
|
|
—
|
|
|
—
|
|
|
(182,873
|
)
|
|
(182,873
|
)
|
||||
Balances at December 31, 2017
|
137,000
|
|
854,452
|
|
|
(113,613
|
)
|
|
(442,134
|
)
|
|
298,705
|
|
||||
Common stock issued under employee benefit plans, net of shares withheld for tax
|
4,067
|
|
5,099
|
|
|
—
|
|
|
—
|
|
|
5,099
|
|
||||
Taxes paid related to net share settlements
|
—
|
|
(6,650
|
)
|
|
—
|
|
|
—
|
|
|
(6,650
|
)
|
||||
Stock-based compensation expense (Note 7)
|
—
|
|
41,854
|
|
|
—
|
|
|
—
|
|
|
41,854
|
|
||||
Cumulative effect of adoption of new accounting standards (Note 1)
|
—
|
|
—
|
|
|
—
|
|
|
(17,862
|
)
|
|
(17,862
|
)
|
||||
Net loss
|
—
|
|
—
|
|
|
—
|
|
|
(109,034
|
)
|
|
(109,034
|
)
|
||||
Balances at December 31, 2018
|
141,067
|
|
$
|
894,755
|
|
|
$
|
(113,613
|
)
|
|
$
|
(569,030
|
)
|
|
$
|
212,112
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Operating activities:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(109,034
|
)
|
|
$
|
(182,873
|
)
|
|
$
|
(419,003
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
35,063
|
|
|
41,478
|
|
|
41,640
|
|
|||
Stock-based compensation
|
40,887
|
|
|
51,255
|
|
|
69,527
|
|
|||
Excess tax benefit from stock-based compensation
(1)
|
—
|
|
|
—
|
|
|
(3,463
|
)
|
|||
Deferred income taxes
|
(389
|
)
|
|
(2,527
|
)
|
|
38,568
|
|
|||
Non-cash restructuring charges
|
6,282
|
|
|
7,315
|
|
|
17,601
|
|
|||
Non-cash interest expense
|
8,112
|
|
|
5,345
|
|
|
—
|
|
|||
Impairment of intangible assets
|
—
|
|
|
—
|
|
|
7,088
|
|
|||
Gain on sale and license of intellectual property
|
(5,000
|
)
|
|
—
|
|
|
—
|
|
|||
Other
|
1,696
|
|
|
4,094
|
|
|
7,574
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable, net
|
(16,460
|
)
|
|
52,278
|
|
|
(18,816
|
)
|
|||
Inventory
|
34,093
|
|
|
16,641
|
|
|
21,040
|
|
|||
Prepaid expenses and other assets
|
35,390
|
|
|
9,303
|
|
|
(14,618
|
)
|
|||
Accounts payable and other liabilities
|
(70,400
|
)
|
|
(44,411
|
)
|
|
142,941
|
|
|||
Deferred revenue
|
(2,674
|
)
|
|
5,249
|
|
|
2,168
|
|
|||
Net cash used in operating activities
|
(42,434
|
)
|
|
(36,853
|
)
|
|
(107,753
|
)
|
|||
|
|
|
|
|
|
||||||
Investing activities:
|
|
|
|
|
|
||||||
Purchases of property and equipment, net
|
(11,004
|
)
|
|
(24,061
|
)
|
|
(43,627
|
)
|
|||
Purchases of marketable securities
|
(57,731
|
)
|
|
(52,318
|
)
|
|
—
|
|
|||
Maturities of marketable securities
|
57,500
|
|
|
21,659
|
|
|
119,918
|
|
|||
Sale of marketable securities
|
—
|
|
|
11,623
|
|
|
47,348
|
|
|||
Proceeds from the sale and license of intellectual property
|
5,000
|
|
|
—
|
|
|
—
|
|
|||
Acquisitions, net of cash acquired
|
—
|
|
|
—
|
|
|
(104,353
|
)
|
|||
Net cash provided by (used in) investing activities
|
(6,235
|
)
|
|
(43,097
|
)
|
|
19,286
|
|
|||
|
|
|
|
|
|
||||||
Financing activities:
|
|
|
|
|
|
||||||
Proceeds from issuance of common stock
|
5,169
|
|
|
9,751
|
|
|
9,664
|
|
|||
Taxes paid related to net share settlement of equity awards
|
(6,650
|
)
|
|
(12,118
|
)
|
|
(6,889
|
)
|
|||
Proceeds from issuance of convertible senior notes
|
—
|
|
|
175,000
|
|
|
—
|
|
|||
Prepayment of forward stock repurchase transaction
|
—
|
|
|
(78,000
|
)
|
|
—
|
|
|||
Excess tax benefit from stock-based compensation
(1)
|
—
|
|
|
—
|
|
|
3,463
|
|
|||
Payment of deferred acquisition-related consideration
|
—
|
|
|
(75
|
)
|
|
(950
|
)
|
|||
Payment of debt issuance costs
|
—
|
|
|
(5,964
|
)
|
|
(3,333
|
)
|
|||
Net cash provided by (used in) financing activities
|
(1,481
|
)
|
|
88,594
|
|
|
1,955
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(259
|
)
|
|
1,746
|
|
|
(1,046
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
(50,409
|
)
|
|
10,390
|
|
|
(87,558
|
)
|
|||
Cash and cash equivalents at beginning of period
|
202,504
|
|
|
192,114
|
|
|
279,672
|
|
|||
Cash and cash equivalents at end of period
|
$
|
152,095
|
|
|
$
|
202,504
|
|
|
$
|
192,114
|
|
|
|
|
|
|
|
(1)
|
Effective January 1, 2017, the Company adopted an accounting standard which addresses, among other items, updates to the presentation and treatment of excess tax benefits related to stock-based compensation.
|
Level 1
|
Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to directly access.
|
Level 2
|
Valuations based on quoted prices for similar assets or liabilities; valuations for interest-bearing securities based on non-daily quoted prices in active markets; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.
|
Level 3
|
Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
•
|
The Company recognized revenue when persuasive evidence of an arrangement existed, delivery had occurred, the sales price was fixed and determinable and collectability was reasonably assured.
|
•
|
The Company allocated the transaction price based on its best estimate of the selling price (BESP). The Company’s process for determining BESP was materially the same as its’ current allocation of the transaction price to each performance obligation.
|
•
|
Sales incentives were recorded as a reduction to revenue in the period the incentives were offered to customers or the related revenue was recognized, whichever was later.
|
Standard
|
|
Description
|
|
Company’s date of adoption
|
|
Effect on the consolidated financial statements or other significant matters
|
Standards that were adopted
|
|
|
|
|
||
Income Taxes
ASU No. 2016-16 (Topic 740)
|
|
This standard requires entities to recognize the income tax consequences of intra-entity asset transfers when they occur, which removes the exception to postpone recognition until the asset has been sold to an outside party.
|
|
January 1, 2018
|
|
The adoption of the standard resulted in the recognition of previously unrecognized deferred charges using a modified retrospective method. The Company recorded a reversal of $15.0 million of deferred charges, an increase to United States deferred tax assets of $1.2 million with a corresponding United States valuation allowance of $1.2 million. The net impact to equity was an increase in the accumulated deficit of approximately $15.0 million upon adoption.
|
Stock Compensation
ASU No. 2017-09 (Topic 718) |
|
This standard clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under this standard, modification accounting is required only if the fair value, the vesting conditions or the classification of an award as equity or liability changes as a result of the change in terms or conditions.
|
|
January 1, 2018
|
|
The
adoption of
ASU 2017-09 did not impact the Company’s consolidated financial statements and related disclosures. The Company adopted the standard on a prospective basis.
|
Revenue from Contracts with Customers
ASU No. 2014-09, 2015-14, 2016-08, 2016-10 and 2016-12 (Topic 606)
|
|
The updated revenue standard establishes principles for recognizing revenue and develops a common revenue standard for all industries. Under the new model, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard requires that entities disclose the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers.
|
|
January 1, 2018
|
|
Under the updated revenue standard, the recognition of product revenue at the time the product is delivered, and PCS revenue on a straight-line basis remains consistent with the Company’s previous revenue policy.
Sales incentives are considered variable consideration under the new standard and are accounted for as a reduction to the transaction price. This change resulted in a reduction of revenue being recorded earlier than under the previous guidance. As a result of the adoption of the new standard, the Company recorded a $2.9 million increase to its accumulated deficit on January 1, 2018, of which, $4.9 million related to certain estimated sales incentives which would have been recognized at the time the product was shipped in the prior period. Additionally, for customers who purchased products directly from the Company’s website, the new standard provides for a policy election whereby the Company has recorded revenue when the related product was shipped. This change resulted in recognition of revenue earlier than under previous guidance. Upon adoption, the Company’s accumulated deficit decreased by $2.0 million related to revenue that would have been recognized in the prior period from the Company’s website sales that had shipped but had not been delivered as of December 31, 2017. In addition, the Company recorded a $1.0 million increase to deferred tax assets and a corresponding $1.0 million increase in valuation allowance. Additionally, under the new standard, the Company reclassed its refund liability from an offset to accounts receivable to an increase in accrued liabilities, which increased the Company’s days sales outstanding.
The Company adopted the standard using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Prior periods were not retrospectively adjusted. Refer below for the impact on each financial statement line item as of and for the full year ended December 31, 2018 due to the adoption of the standard.
|
(in thousands)
|
Balance at December 31, 2017
|
|
Adjustment due to ASU 2014-09
|
|
Adjustment due to ASU 2016-16
|
|
Balance at January 1, 2018
|
||||||||
Accumulated deficit
|
$
|
(442,134
|
)
|
|
$
|
(2,872
|
)
|
|
$
|
(14,990
|
)
|
|
$
|
(459,996
|
)
|
|
Year ended December 31, 2018
|
||||||||||
(in thousands)
|
As Reported Under ASC 606
|
|
Effect of Change
|
|
Balance Under ASC 605
|
||||||
Revenue
|
$
|
1,148,337
|
|
|
$
|
2,659
|
|
|
$
|
1,150,996
|
|
|
As of December 31, 2018
|
||||||||||
(in thousands)
|
As Reported Under ASC 606
|
|
Effect of Change
|
|
Balance Under ASC 605
|
||||||
Accounts receivable, net
|
$
|
129,216
|
|
|
$
|
(13,100
|
)
|
|
$
|
116,116
|
|
Inventory, net
|
116,458
|
|
|
5,474
|
|
|
121,932
|
|
|||
Prepaid expenses and other current assets
|
30,887
|
|
|
(5,474
|
)
|
|
25,413
|
|
|||
Accrued liabilities
|
135,892
|
|
|
(13,100
|
)
|
|
122,792
|
|
|||
Current deferred revenue
|
15,129
|
|
|
2,184
|
|
|
17,313
|
|
Standard
|
|
Description
|
|
Expected date of adoption
|
|
Effect on the consolidated financial statements or other significant matters
|
Standards not yet adopted
|
|
|
|
|
||
Leases
ASU No.
2016-02,
2018-10,
2018-11, (Topic 842)
|
|
This standard requires lessees to reflect most leases on their balance sheets and recognize the expenses on their income statements in a manner similar to current practice. Lessees would recognize a right-to-use asset and a lease liability for all leases with terms of more than 12 months. The new standard should be applied on a modified retrospective basis or using the cumulative effect transition method.
|
|
January 1, 2019
|
|
The Company identified its population of lease arrangements by reviewing its current lease agreements to identify the changes to total assets and total liabilities on the Company’s consolidated balance sheet as a result of adopting the standard. The Company plans to elect the package of practical expedients, which among other things, allows the Company to maintain its existing classification of its current leases. The Company also plans to elect the hindsight practical expedient to determine the reasonably certain lease term for existing leases. Additionally, the Company plans to make a policy election to maintain its current lease accounting for leases with an initial term of 12 months or less. The Company plans to adopt the standard using the cumulative effect transition method.
While the Company is finalizing the impact of its restructuring plans on its right of use asset calculation, the Company expects the adoption of the standard will result in the recognition of additional lease liabilities of approximately $89 million to $93 million. The Company does not believe the standard will have a material impact on its consolidated income statement and consolidated statement of cash flows.
|
Intangible - Goodwill and Other
ASU No. 2017-04 (Topic 350)
|
|
This standard simplifies the accounting for goodwill and removes Step 2 of the annual goodwill impairment test. Upon adoption, goodwill impairment will be determined based on the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017, and requires use of a prospective transition method.
|
|
January 1, 2020
|
|
The Company does not expect that the adoption of this standard will have a material impact on its consolidated financial statements and related disclosures.
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
(in thousands)
|
Level 1
|
|
Level 2
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Total
|
||||||||||||
Cash equivalents
(1)
:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Money market funds
|
$
|
10,901
|
|
|
$
|
—
|
|
|
$
|
10,901
|
|
|
$
|
25,251
|
|
|
$
|
—
|
|
|
$
|
25,251
|
|
Commercial paper
|
7,577
|
|
|
—
|
|
|
7,577
|
|
|
14,981
|
|
|
—
|
|
|
14,981
|
|
||||||
Corporate debt securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,500
|
|
|
2,500
|
|
||||||
Agency securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,999
|
|
|
4,999
|
|
||||||
Total cash equivalents
|
$
|
18,478
|
|
|
$
|
—
|
|
|
$
|
18,478
|
|
|
$
|
40,232
|
|
|
$
|
7,499
|
|
|
$
|
47,731
|
|
Marketable securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. treasury securities
|
$
|
—
|
|
|
$
|
6,336
|
|
|
$
|
6,336
|
|
|
$
|
—
|
|
|
$
|
4,995
|
|
|
$
|
4,995
|
|
Commercial paper
|
20,657
|
|
|
—
|
|
|
20,657
|
|
|
19,888
|
|
|
—
|
|
|
19,888
|
|
||||||
Corporate debt securities
|
—
|
|
|
18,424
|
|
|
18,424
|
|
|
—
|
|
|
20,003
|
|
|
20,003
|
|
||||||
Total marketable securities
|
$
|
20,657
|
|
|
$
|
24,760
|
|
|
$
|
45,417
|
|
|
$
|
19,888
|
|
|
$
|
24,998
|
|
|
$
|
44,886
|
|
(1)
|
Included in cash and cash equivalents in the accompanying consolidated balance sheets. Cash balances were
$133.6 million
and
$154.8 million
as of
December 31, 2018
and
2017
, respectively.
|
(in thousands)
|
December 31, 2018
|
|
December 31, 2017
|
||||
Components
|
$
|
19,205
|
|
|
$
|
18,995
|
|
Finished goods
|
97,253
|
|
|
131,556
|
|
||
Total inventory
|
$
|
116,458
|
|
|
$
|
150,551
|
|
(in thousands)
|
Useful life
(in years)
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Leasehold improvements
|
1–9
|
|
$
|
66,198
|
|
|
$
|
67,713
|
|
Production, engineering and other equipment
|
1-4
|
|
43,019
|
|
|
47,502
|
|
||
Tooling
|
1–2
|
|
17,808
|
|
|
24,871
|
|
||
Computers and software
|
2
|
|
20,865
|
|
|
20,636
|
|
||
Furniture and office equipment
|
3
|
|
14,969
|
|
|
14,895
|
|
||
Tradeshow equipment and other
|
2–5
|
|
7,009
|
|
|
7,237
|
|
||
Construction in progress
|
|
|
80
|
|
|
347
|
|
||
Gross property and equipment
|
|
|
169,948
|
|
|
183,201
|
|
||
Less: Accumulated depreciation and amortization
|
|
|
(123,381
|
)
|
|
(114,614
|
)
|
||
Property and equipment, net
|
|
|
$
|
46,567
|
|
|
$
|
68,587
|
|
|
Useful life
(in months)
|
|
December 31, 2018
|
||||||||||
(in thousands)
|
|
|
Gross carrying value
|
|
Accumulated amortization
|
|
Net carrying value
|
||||||
Purchased technology
|
20-72
|
|
$
|
50,501
|
|
|
$
|
(37,451
|
)
|
|
$
|
13,050
|
|
Domain name
|
|
|
15
|
|
|
—
|
|
|
15
|
|
|||
Total intangible assets
|
|
|
$
|
50,516
|
|
|
$
|
(37,451
|
)
|
|
$
|
13,065
|
|
|
Useful life
(in months)
|
|
December 31, 2017
|
||||||||||
(in thousands)
|
|
|
Gross carrying value
|
|
Accumulated amortization
|
|
Net carrying value
|
||||||
Purchased technology
|
24-72
|
|
$
|
49,901
|
|
|
$
|
(26,017
|
)
|
|
$
|
23,884
|
|
IPR&D
|
|
|
615
|
|
|
—
|
|
|
615
|
|
|||
Total intangible assets
|
|
|
$
|
50,516
|
|
|
$
|
(26,017
|
)
|
|
$
|
24,499
|
|
(in thousands)
|
Total
|
||
Year ending December 31,
|
|
||
2019
|
$
|
7,818
|
|
2020
|
4,363
|
|
|
2021
|
869
|
|
|
2022
|
—
|
|
|
2023
|
—
|
|
|
|
$
|
13,050
|
|
(in thousands)
|
December 31, 2018
|
|
December 31, 2017
|
||||
POP displays
|
$
|
9,130
|
|
|
$
|
16,451
|
|
Long-term deferred tax assets
|
945
|
|
|
825
|
|
||
Deposits and other
|
8,120
|
|
|
19,738
|
|
||
Other long-term assets
|
$
|
18,195
|
|
|
$
|
37,014
|
|
(in thousands)
|
December 31, 2018
|
|
December 31, 2017
|
||||
Accrued sales incentives
|
$
|
40,918
|
|
|
$
|
89,549
|
|
Accrued payables
(1)
|
34,696
|
|
|
44,582
|
|
||
Employee related liabilities
(1)
|
19,775
|
|
|
24,945
|
|
||
Refund liability
(2)
|
13,100
|
|
|
—
|
|
||
Warranty liability
|
9,604
|
|
|
9,934
|
|
||
Inventory received
|
5,061
|
|
|
14,470
|
|
||
Customer deposits
|
3,105
|
|
|
8,700
|
|
||
Purchase order commitments
|
2,015
|
|
|
6,162
|
|
||
Income taxes payable
|
1,948
|
|
|
1,247
|
|
||
Other
|
5,670
|
|
|
13,441
|
|
||
Accrued liabilities
|
$
|
135,892
|
|
|
$
|
213,030
|
|
(1)
|
See Note
13
Restructuring charges
, for amounts associated with restructuring liabilities.
|
(2)
|
See Note
1
Summary of business and significant accounting policies
for a discussion on recently adopted accounting standards.
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Beginning balance
|
$
|
10,373
|
|
|
$
|
11,945
|
|
|
$
|
10.856
|
|
Charged to cost of revenue
|
24,725
|
|
|
20,139
|
|
|
19.272
|
|
|||
Settlement of warranty claims
|
(24,127
|
)
|
|
(21,711
|
)
|
|
(18.183
|
)
|
|||
Warranty liability
|
$
|
10,971
|
|
|
$
|
10,373
|
|
|
$
|
11.945
|
|
•
|
during any calendar quarter beginning after the calendar quarter ending on September 30, 2017, if the last reported sale price of Class A common stock for at least 20 trading days (whether or not consecutive) during the last 30 consecutive trading days of the immediately preceding fiscal quarter is greater than or equal to
130%
of the conversion price of the Notes on each applicable trading day;
|
•
|
during the five-business day period following any five consecutive trading day period in which the trading price for the Notes is less than
98%
of the product of the last reported sale price of Class A common stock and the conversion rate for the Notes on each such trading day; or
|
•
|
upon the occurrence of specified corporate events.
|
(in thousands)
|
December 31, 2018
|
|
Stock options outstanding
|
5,993
|
|
Restricted stock units outstanding
|
7,217
|
|
Performance stock units outstanding
|
300
|
|
Common stock available for future grants
|
31,421
|
|
Total common stock shares reserved for issuance
|
44,931
|
|
|
Shares
(in thousands)
|
|
Weighted average
exercise price |
|
Weighted-average remaining contractual term (in years)
|
|
Aggregate intrinsic value
(in thousands) |
|||||
Outstanding at December 31, 2017
|
9,809
|
|
|
$
|
11.16
|
|
|
6.00
|
|
$
|
19,971
|
|
Granted
|
1,333
|
|
|
5.77
|
|
|
|
|
|
|||
Exercised
|
(654
|
)
|
|
0.74
|
|
|
|
|
|
|||
Forfeited/Cancelled
|
(4,495
|
)
|
|
16.26
|
|
|
|
|
|
|||
Outstanding at December 31, 2018
|
5,993
|
|
|
$
|
7.28
|
|
|
5.44
|
|
$
|
7,897
|
|
|
|
|
|
|
|
|
|
|||||
Vested and expected to vest at December 31, 2018
|
5,988
|
|
|
$
|
7.28
|
|
|
5.44
|
|
$
|
7,897
|
|
Exercisable at December 31, 2018
|
4,459
|
|
|
$
|
7.40
|
|
|
4.20
|
|
$
|
7,897
|
|
|
Shares
(in thousands)
|
|
Weighted average grant date fair value
|
|||
Non-vested shares at December 31, 2017
|
9,483
|
|
|
$
|
11.87
|
|
Granted
|
4,612
|
|
|
5.83
|
|
|
Vested
|
(3,559
|
)
|
|
11.70
|
|
|
Forfeited
|
(3,319
|
)
|
|
11.75
|
|
|
Non-vested shares at December 31, 2018
|
7,217
|
|
|
$
|
8.15
|
|
|
Shares
(in thousands)
|
|
Weighted average grant date fair value
|
|||
Non-vested shares at December 31, 2017
|
—
|
|
|
$
|
—
|
|
Granted
|
334
|
|
|
5.76
|
|
|
Vested
|
—
|
|
|
—
|
|
|
Forfeited
|
(34
|
)
|
|
5.74
|
|
|
Non-vested shares at December 31, 2018
|
300
|
|
|
$
|
5.76
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Cost of revenue
|
$
|
1,954
|
|
|
$
|
1,935
|
|
|
$
|
1,616
|
|
Research and development
|
19,636
|
|
|
24,963
|
|
|
31,365
|
|
|||
Sales and marketing
|
9,459
|
|
|
10,498
|
|
|
13,883
|
|
|||
General and administrative
|
9,838
|
|
|
13,859
|
|
|
22,663
|
|
|||
Total stock-based compensation expense
|
$
|
40,887
|
|
|
$
|
51,255
|
|
|
$
|
69,527
|
|
|
Year ended December 31,
|
||||||||||
(in thousands, except per share data)
|
2018
|
|
2017
|
|
2016
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(109,034
|
)
|
|
$
|
(182,873
|
)
|
|
$
|
(419,003
|
)
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
||||||
Weighted-average common shares—basic and diluted for Class A and Class B common stock
|
139,495
|
|
|
138,056
|
|
|
139,425
|
|
|||
|
|
|
|
|
|
||||||
Basic and diluted net loss per share
|
$
|
(0.78
|
)
|
|
$
|
(1.32
|
)
|
|
$
|
(3.01
|
)
|
|
Year ended December 31,
|
|||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|||
Anti-dilutive stock-based awards
|
15,267
|
|
|
18,994
|
|
|
21,000
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Current
|
|
|
|
|
|
||||||
Federal
|
$
|
(2,821
|
)
|
|
$
|
(1,857
|
)
|
|
$
|
(2,925
|
)
|
State
|
175
|
|
|
240
|
|
|
(356
|
)
|
|||
Foreign
|
4,394
|
|
|
10,631
|
|
|
8,542
|
|
|||
Total current
|
1,748
|
|
|
9,014
|
|
|
5,261
|
|
|||
Deferred
|
|
|
|
|
|
||||||
Federal
|
248
|
|
|
(248
|
)
|
|
37,573
|
|
|||
State
|
—
|
|
|
—
|
|
|
4,436
|
|
|||
Foreign
|
(637
|
)
|
|
(2,280
|
)
|
|
(3,441
|
)
|
|||
Total deferred
|
(389
|
)
|
|
(2,528
|
)
|
|
38,568
|
|
|||
Income tax expense
|
$
|
1,359
|
|
|
$
|
6,486
|
|
|
$
|
43,829
|
|
|
Year ended December 31,
|
|||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
(dollars in thousands)
|
$
|
|
%
|
|
$
|
|
%
|
|
$
|
|
%
|
|||||||||
Reconciliation to statutory rate
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Tax at federal statutory rate
|
$
|
(22,612
|
)
|
|
21.0
|
%
|
|
$
|
(61,735
|
)
|
|
35.0
|
%
|
|
$
|
(131,311
|
)
|
|
35.0
|
%
|
Change in valuation allowance
|
42,772
|
|
|
(39.7
|
)
|
|
(36,497
|
)
|
|
20.7
|
|
|
101,878
|
|
|
(27.2
|
)
|
|||
DTA rate change impact due to TCJA
|
—
|
|
|
—
|
|
|
73,423
|
|
|
(41.6
|
)
|
|
—
|
|
|
—
|
|
|||
Impact of foreign operations
|
3,285
|
|
|
(3.1
|
)
|
|
34,039
|
|
|
(19.3
|
)
|
|
84,491
|
|
|
(22.5
|
)
|
|||
Stock-based compensation
|
10,974
|
|
|
(10.2
|
)
|
|
12,001
|
|
|
(6.8
|
)
|
|
15,718
|
|
|
(4.2
|
)
|
|||
State income taxes, net of federal benefit
|
(2,997
|
)
|
|
2.8
|
|
|
(6,469
|
)
|
|
3.7
|
|
|
(14,195
|
)
|
|
3.8
|
|
|||
Impact of IRS audit
|
(9,687
|
)
|
|
9.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Restructuring adjustment
|
(18,694
|
)
|
|
17.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Tax credits
|
(5,996
|
)
|
|
5.6
|
|
|
(9,957
|
)
|
|
5.6
|
|
|
(12,992
|
)
|
|
3.5
|
|
|||
Permanent tax adjustments
|
3,786
|
|
|
(3.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Other
|
528
|
|
|
(0.6
|
)
|
|
1,681
|
|
|
(1.0
|
)
|
|
240
|
|
|
(0.1
|
)
|
|||
Income tax provision at effective tax rate
|
$
|
1,359
|
|
|
(1.3
|
)%
|
|
$
|
6,486
|
|
|
(3.7
|
)%
|
|
$
|
43,829
|
|
|
(11.7
|
)%
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
166,281
|
|
|
$
|
121,952
|
|
Tax credit carryforwards
|
70,189
|
|
|
66,983
|
|
||
Stock-based compensation
|
6,414
|
|
|
13,055
|
|
||
Allowance for returns
|
3,147
|
|
|
5,452
|
|
||
Intangible assets
|
4,591
|
|
|
770
|
|
||
Depreciation and amortization
|
609
|
|
|
—
|
|
||
Accruals and reserves
|
20,975
|
|
|
18,981
|
|
||
Total deferred tax assets
|
272,206
|
|
|
227,193
|
|
||
Valuation allowance
|
(271,374
|
)
|
|
(226,458
|
)
|
||
Total deferred tax assets, net of valuation allowance
|
832
|
|
|
735
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Depreciation and amortization
|
—
|
|
|
(292
|
)
|
||
Total deferred tax liabilities
|
—
|
|
|
(292
|
)
|
||
Net deferred tax assets
|
$
|
832
|
|
|
$
|
443
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Balance at January 1
|
$
|
58,584
|
|
|
$
|
56,909
|
|
|
$
|
36,273
|
|
Increase related to current year tax positions
|
483
|
|
|
20,002
|
|
|
20,594
|
|
|||
Decrease related to tax rate change for current year tax positions
|
—
|
|
|
(2,299
|
)
|
|
—
|
|
|||
Increase related to prior year tax positions
|
445
|
|
|
—
|
|
|
130
|
|
|||
Decrease related to prior year tax positions
|
(26,956
|
)
|
|
(3,927
|
)
|
|
(88
|
)
|
|||
Decrease related to tax rate change for prior year tax positions
|
—
|
|
|
(12,101
|
)
|
|
—
|
|
|||
|
$
|
32,556
|
|
|
$
|
58,584
|
|
|
$
|
56,909
|
|
(in thousands)
|
Total
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
||||||||||||||
Operating leases
(1)
|
$
|
107,817
|
|
|
$
|
14,845
|
|
|
$
|
17,654
|
|
|
$
|
17,763
|
|
|
$
|
17,552
|
|
|
$
|
17,052
|
|
|
$
|
22,951
|
|
Sponsorship commitments
(2)
|
4,018
|
|
|
3,906
|
|
|
112
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Other contractual commitments
(3)
|
2,447
|
|
|
2,229
|
|
|
114
|
|
|
104
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Long-term debt
(4)
|
175,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
175,000
|
|
|
—
|
|
|
—
|
|
|||||||
Total contractual cash obligations
|
$
|
289,282
|
|
|
$
|
20,980
|
|
|
$
|
17,880
|
|
|
$
|
17,867
|
|
|
$
|
192,552
|
|
|
$
|
17,052
|
|
|
$
|
22,951
|
|
(1)
|
The Company leases its facilities under long-term operating leases, which expire at various dates through 2027.
|
(2)
|
The Company enters into multi-year sponsorship agreements with event organizers, resorts and athletes as part of its marketing efforts.
|
(3)
|
The Company enters into other contractual commitments, including software licenses related to the Company’s financial and IT systems which require payments over several years.
|
(4)
|
The Company's convertible senior notes are due April 2022. Refer to Note
5
Financing Arrangements
.
|
|
December 31, 2018
|
|
December 31, 2017
|
Customer A
|
12%
|
|
11%
|
Customer B
|
11%
|
|
32%
|
Customer C
|
*
|
|
16%
|
Customer D
|
*
|
|
12%
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Accounts receivable sold
|
$
|
126,220
|
|
|
$
|
178,300
|
|
|
$
|
167,769
|
|
Factoring fees
|
1,639
|
|
|
1,630
|
|
|
1,266
|
|
|
Year ended December 31,
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|
% Change
|
|
% Change
|
||||||||
Americas
|
$
|
498,633
|
|
|
$
|
591,879
|
|
|
$
|
619,784
|
|
|
(16
|
)%
|
|
(5
|
)%
|
Europe, Middle East and Africa (EMEA)
|
366,037
|
|
|
334,872
|
|
|
366,352
|
|
|
9
|
|
|
(9
|
)
|
|||
Asia and Pacific (APAC)
|
283,667
|
|
|
252,990
|
|
|
199,345
|
|
|
12
|
|
|
27
|
|
|||
Total revenue
|
$
|
1,148,337
|
|
|
$
|
1,179,741
|
|
|
$
|
1,185,481
|
|
|
(3
|
)%
|
|
—
|
%
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Cost of revenue
|
$
|
1,379
|
|
|
$
|
634
|
|
|
$
|
497
|
|
Research and development
|
12,794
|
|
|
10,092
|
|
|
17,197
|
|
|||
Sales and marketing
|
5,291
|
|
|
7,047
|
|
|
12,064
|
|
|||
General and administrative
|
3,279
|
|
|
2,519
|
|
|
13,331
|
|
|||
Total restructuring charges
|
$
|
22,743
|
|
|
$
|
20,292
|
|
|
$
|
43,089
|
|
(in thousands)
|
Severance
|
|
Other
|
|
Total
|
||||||
Restructuring liability as of December 31, 2017
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restructuring charges
|
14,107
|
|
|
3,686
|
|
|
17,793
|
|
|||
Cash paid
|
(12,460
|
)
|
|
(1,988
|
)
|
|
(14,448
|
)
|
|||
Non-cash reductions
|
(528
|
)
|
|
(1,299
|
)
|
|
(1,827
|
)
|
|||
Restructuring liability as of December 31, 2018
|
$
|
1,119
|
|
|
$
|
399
|
|
|
$
|
1,518
|
|
(in thousands)
|
Severance
|
|
Other
|
|
Total
|
||||||
Restructuring liability as of December 31, 2016
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restructuring charges
|
10,312
|
|
|
6,654
|
|
|
16,966
|
|
|||
Cash paid
|
(9,509
|
)
|
|
(151
|
)
|
|
(9,660
|
)
|
|||
Non-cash reductions
|
(803
|
)
|
|
(2,953
|
)
|
|
(3,756
|
)
|
|||
Restructuring liability as of December 31, 2017
|
—
|
|
|
3,550
|
|
|
3,550
|
|
|||
Restructuring charges
|
—
|
|
|
4,783
|
|
|
4,783
|
|
|||
Cash paid
|
—
|
|
|
(3,293
|
)
|
|
(3,293
|
)
|
|||
Non-cash charges
|
—
|
|
|
627
|
|
|
627
|
|
|||
Restructuring liability as of December 31, 2018
|
$
|
—
|
|
|
$
|
5,667
|
|
|
$
|
5,667
|
|
(in thousands)
|
Severance
|
|
Other
|
|
Total
|
||||||
Restructuring liability as of December 31, 2015
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restructuring charges
|
18,893
|
|
|
879
|
|
|
19,772
|
|
|||
Cash paid
|
(8,440
|
)
|
|
—
|
|
|
(8,440
|
)
|
|||
Non-cash settlements
|
(793
|
)
|
|
—
|
|
|
(793
|
)
|
|||
Restructuring liability as of December 31, 2016
|
9,660
|
|
|
879
|
|
|
10,539
|
|
|||
Restructuring charges
|
2,134
|
|
|
1,055
|
|
|
3,189
|
|
|||
Cash paid
|
(11,411
|
)
|
|
(1,884
|
)
|
|
(13,295
|
)
|
|||
Non-cash settlements
|
17
|
|
|
—
|
|
|
17
|
|
|||
Restructuring liability as of December 31, 2017
|
400
|
|
|
50
|
|
|
450
|
|
|||
Restructuring charges
|
143
|
|
|
—
|
|
|
143
|
|
|||
Cash paid
|
(244
|
)
|
|
—
|
|
|
(244
|
)
|
|||
Restructuring liability as of December 31, 2018
|
$
|
299
|
|
|
$
|
50
|
|
|
$
|
349
|
|
(in thousands)
|
Balance at Beginning of Year
|
|
Charges to Revenue
|
|
Charges to Expense
|
|
Charges to Other Accounts - Equity
|
|
Deductions/Write-offs
|
|
Balance at End of Year
|
||||||||||||
Allowance for doubtful accounts receivable:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Year ended December 31, 2018
|
$
|
750
|
|
|
$
|
—
|
|
|
$
|
199
|
|
|
$
|
—
|
|
|
$
|
(449
|
)
|
|
$
|
500
|
|
Year ended December 31, 2017
|
1,281
|
|
|
—
|
|
|
(263
|
)
|
|
—
|
|
|
(268
|
)
|
|
750
|
|
||||||
Year ended December 31, 2016
|
1,400
|
|
|
—
|
|
|
40
|
|
|
—
|
|
|
(159
|
)
|
|
1,281
|
|
||||||
Allowance for sales returns:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Year ended December 31, 2018
|
$
|
26,758
|
|
|
$
|
67,403
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(81,061
|
)
|
|
$
|
13,100
|
|
Year ended December 31, 2017
|
20,038
|
|
|
55,274
|
|
|
—
|
|
|
—
|
|
|
(48,554
|
)
|
|
26,758
|
|
||||||
Year ended December 31, 2016
|
26,280
|
|
|
35,136
|
|
|
—
|
|
|
—
|
|
|
(41,378
|
)
|
|
20,038
|
|
||||||
Valuation allowance for deferred tax assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Year ended December 31, 2018
|
$
|
226,458
|
|
|
$
|
—
|
|
|
$
|
42,772
|
|
|
$
|
2,144
|
|
|
$
|
—
|
|
|
$
|
271,374
|
|
Year ended December 31, 2017
|
110,433
|
|
|
—
|
|
|
(36,497
|
)
|
|
152,522
|
|
|
—
|
|
|
226,458
|
|
||||||
Year ended December 31, 2016
|
8,555
|
|
|
—
|
|
|
101,878
|
|
|
—
|
|
|
—
|
|
|
110,433
|
|
1.
|
Financial Statements
|
2.
|
Financial Statement Schedules
|
3.
|
Exhibit Listing
|
Exhibit
|
|
|
Incorporated by Reference
|
Filed
|
|||
Number
|
|
Exhibit Title
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
Herewith
|
|
Restated Certificate of Incorporation of the Registrant, with Certificate of Change of Registered Agent and/or Registered Office
|
|
|
|
|
X
|
|
|
Amended and Restated Bylaws of the Registrant.
|
S-1
|
333-200038
|
3.02
|
November 10, 2014
|
|
|
|
Form of Registrant’s Class A common stock certificate.
|
S-1
|
333-196083
|
4.01
|
May 19, 2014
|
|
|
10.01
*
|
|
Form of Indemnity Agreement by and between the Registrant and each of its directors and executive officers.
|
S-1
|
333-196083
|
10.01
|
May 19, 2014
|
|
10.02
*
|
|
Form of Change in Control Severance Agreement.
|
S-1
|
333-196083
|
10.09
|
May 19, 2014
|
|
10.03
*
|
|
2010 Equity Incentive Plan, as amended, and form of stock option agreement and restricted stock unit agreement.
|
S-1
|
333-196083
|
10.02
|
May 19, 2014
|
|
10.04
*
|
|
2014 Equity Incentive Plan, as amended, and forms thereunder.
|
10-Q
|
001-36514
|
10.03
|
July 29, 2016
|
|
10.05
*
|
|
2014 Employee Stock Purchase Plan and forms thereunder.
|
S-1/A
|
333-196083
|
10.04
|
June 11, 2014
|
|
10.06
*
|
|
Executive Severance Policy.
|
|
|
|
|
X
|
10.07
*
|
|
Employment Letter to Nicholas Woodman from the Registrant, dated June 2, 2014.
|
S-1/A
|
333-196083
|
10.16
|
June 11, 2014
|
|
10.08
*
|
|
Waiver Agreement dated January 1, 2018 by and between Nicholas Woodman and the Registrant.
|
10-K
|
001-36514
|
10.17
|
February 16, 2018
|
|
10.09
*
|
|
Offer Letter to Eve Saltman from the Registrant, dated March 7, 2018.
|
10-Q
|
001-36514
|
10.02
|
May 4, 2018
|
|
10.10
*
|
|
Offer Letter to Brian McGee from the Registrant, dated September 3, 2015.
|
10-K
|
001-36514
|
10.12
|
February 16, 2017
|
|
10.11
*
|
|
Offer Letter to Sandor Barna from the Registrant, dated July 8, 2015
|
|
|
|
|
X
|
10.12
*
|
|
Officer Letter to Sandor Barna from the Registrant, dated February 12, 2018
|
10-Q
|
001-36514
|
10.01
|
May 4, 2018
|
|
|
Office Lease Agreement, dated as of November 1, 2011, by and between Locon San Mateo, LLC and the Registrant, as amended, and other leases for the Registrant’s headquarters.
|
S-1
|
333-196083
|
10.12
|
May 19, 2014
|
|
|
|
Eighth amendment to Office Lease Agreement, by and between RAR2 - Clearview Business Park Owner QRS, LLC and the Registrant, dated February 24, 2016.
|
10-K
|
001-36514
|
10.15
|
February 16, 2017
|
|
|
Ninth amendment to Office Lease Agreement, by and between RAR2 - Clearview Business Park Owner QRS, LLC and the Registrant, dated August 3, 2016.
|
10-K
|
001-36514
|
10.16
|
February 16, 2017
|
|
|
|
Credit Agreement by and among Registrant, the Lenders party thereto and JPMorgan Chase Bank, N.A. dated March 25, 2016.
|
10-Q
|
001-36514
|
10.17
|
May 6, 2016
|
|
|
|
Forward Stock Purchase Transaction, dated April 6, 2017, between the Company and JPMorgan Chase Bank, National Association.
|
8-K
|
001-36514
|
10.1
|
April 7, 2017
|
|
|
|
First Amendment, dated August 12, 2016, to Office Lease Agreement dated November 1, 2011, between the Company and RAR2-Clearview Business Park Owner, LLC.
|
10-Q
|
001-36514
|
10.02
|
August 4, 2017
|
|
|
|
List of Subsidiaries.
|
|
|
|
|
X
|
|
|
Consent of Independent Registered Public Accounting Firm.
|
|
|
|
|
X
|
|
|
Power of Attorney (included on the signature page to this Annual Report on Form 10-K).
|
|
|
|
|
X
|
|
|
Certification of Principal Executive Officer Required Under Rule 13(a)-14(a) and 15(d)-14(a) of the Securities Exchange Act of 1934, as amended.
|
|
|
|
|
X
|
|
|
Certification of Principal Financial Officer Required Under Rule 13(a)-14(a) and 15(d)-14(a) of the Securities Exchange Act of 1934, as amended.
|
|
|
|
|
X
|
|
32.1
‡
|
|
Certification of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.
|
|
|
|
|
X
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
|
|
|
|
GoPro, Inc.
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
|
|
|
Dated:
|
February 15, 2019
|
By: /s/ Nicholas Woodman
|
|
|
Nicholas Woodman
Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
|
|
|
|
|
Dated:
|
February 15, 2019
|
By: /s/ Brian McGee
|
|
|
Brian McGee
Chief Financial Officer (Principal Financial Officer) |
|
Name
|
|
Title
|
|
Date
|
|
|
|
|
|
|
By:
|
/s/ Nicholas Woodman
|
|
Chief Executive Officer and Chairman
|
|
February 15, 2019
|
|
Nicholas Woodman
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
|
By:
|
/s/ Brian McGee
|
|
Chief Financial Officer
|
|
February 15, 2019
|
|
Brian McGee
|
|
(Principal Financial and Accounting Officer)
|
|
|
|
|
|
|
|
|
By:
|
/s/ Kenneth Goldman
|
|
Director
|
|
February 15, 2019
|
|
Kenneth Goldman
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Peter Gotcher
|
|
Director
|
|
February 15, 2019
|
|
Peter Gotcher
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ James Lanzone
|
|
Director
|
|
February 15, 2019
|
|
James Lanzone
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Tyrone Ahmad-Taylor
|
|
Director
|
|
February 15, 2019
|
|
Tyrone Ahmad-Taylor
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Alexander Lurie
|
|
Director
|
|
February 15, 2019
|
|
Alexander Lurie
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Susan Lyne
|
|
Director
|
|
February 15, 2019
|
|
Susan Lyne
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Frederic Welts
|
|
Director
|
|
February 15, 2019
|
|
Frederic Welts
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Lauren Zalaznick
|
|
Director
|
|
February 15, 2019
|
|
Lauren Zalaznick
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.
|
The name of the corporation is GoPro, Inc. The date of filing its original Certificate of Incorporation with the Secretary of State was August 24, 2011, under the name Woodman Labs, Inc.
|
|
2.
|
The Restated Certificate of Incorporation of the corporation attached hereto as
Exhibit “1”
, which is incorporated herein by this reference, and which restates, integrates and further amends the provisions of the Certificate of Incorporation of this corporation, as previously amended and/or restated, has been duly adopted by the corporation’s Board of Directors and by the stockholders in accordance with Sections 242 and 245 of the General Corporation Law of the State of Delaware, with the approval of the corporation’s stockholders having been given by written consent without a meeting in accordance with Section 228 of the General Corporation Law of the State of Delaware.
|
Dated:
|
|
July 1, 2014
|
GoPro, Inc.
|
||
|
|
|
|
||
|
|
|
By:
|
|
/s/ Nicholas Woodman
|
|
|
|
Name:
|
|
Nicholas Woodman
|
|
|
|
Title:
|
|
Chief Executive Officer
|
By:
|
/s/ Jeanne Nelson
|
|
Authorized Officer
|
|
|
|
|
Name:
|
Jeanne Nelson
|
|
Print of Type
|
Sincerely,
|
GoPro, Inc.
|
|
[Company Signatory Name, Title]
|
Acknowledged and agreed,
|
|
|
|
[Recipient First] [Recipient Last]
|
|
|
|
|
(Date)
|
Sincerely,
|
|
/s/ Jeff Ryan
|
|
Jeff Ryan
|
VP, People
|
Agreed to and accepted:
|
|
|
|
|
|
|
|
|
|
|
|
Signature: /s/
|
Sandor Barna
|
Date:
|
7/11/2015
|
|
Sandor Barna
|
|
|
|
|
Exhibit 21.01
|
|
|
|
|
|
|
List of Subsidiaries
|
||
|
|
|
|
|
|
Name
|
|
Jurisdiction of Incorporation
|
GoPro Australia Pty Ltd
|
|
Australia
|
GoPro do Brasil Participações Ltda.
|
|
Brazil
|
GoPro Philippines Ltd.
|
|
Cayman Islands
|
GoPro Technology (Shenzhen) Limited
|
|
China
|
GoPro Trading (Shanghai) Limited
|
|
China
|
GoPro Technology France SAS
|
|
France
|
Kolor SAS
|
|
France
|
GoPro GmbH
|
|
Germany
|
GoPro Hong Kong Limited
|
|
Hong Kong
|
GoPro GK
|
|
Japan
|
GoPro Coöperatief U.A.
|
|
The Netherlands
|
GoPro Holding B.V.
|
|
The Netherlands
|
GoPro International B.V.
|
|
The Netherlands
|
GoPro Bucharest S.R.L.
|
|
Romania
|
GoPro Switzerland AG
|
|
Switzerland
|
GoPro Media (UK) Ltd.
|
|
United Kingdom
|
GoPro Care, Inc.
|
|
United States
|
GoPro Care Services, Inc.
|
|
United States
|
GoPro Holdco, Inc.
|
|
United States
|
GoPro Mobility (U.S.), LLC
|
|
United States
|
|
|
|
|
|
|
|
|
|
Date:
|
February 15, 2019
|
/s/ Nicholas Woodman
|
|
|
Nicholas Woodman
Chief Executive Officer
(Principal Executive Officer)
|
Date:
|
February 15, 2019
|
/s/ Brian McGee
|
|
|
Brian McGee
Chief Financial Officer
(Principal Financial Officer)
|
By: /s/ Nicholas Woodman
|
Nicholas Woodman
Chief Executive Officer
(Principal Executive Officer)
|
February 15, 2019
|
By: /s/ Brian McGee
|
Brian McGee
Chief Financial Officer
(Principal Financial Officer)
|
February 15, 2019
|