Delaware
|
|
94-3180138
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
Large accelerated filer
|
|
¨
|
|
Accelerated filer
|
|
ý
|
|
|
|
|
|||
Non-accelerated filer
|
|
¨
(Do not check if a smaller reporting company)
|
|
Smaller Reporting Company
|
|
¨
|
|
|
|
|
Emerging Growth Company
|
|
¨
|
|
|
|
|
|
Page
|
|
|
|
Item 1.
|
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
|
||
|
|
|
Item 1.
|
||
|
|
|
Item 1A.
|
||
|
|
|
Item 6.
|
||
|
|
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
119,128
|
|
|
$
|
24,622
|
|
Short-term investments
|
|
19,842
|
|
|
21,916
|
|
||
Accounts and other receivables
|
|
2,667
|
|
|
806
|
|
||
Prepaid expenses and other current assets
|
|
5,616
|
|
|
736
|
|
||
Total current assets
|
|
147,253
|
|
|
48,080
|
|
||
Property and equipment, net
|
|
2,903
|
|
|
3,150
|
|
||
Deferred income tax assets
|
|
371
|
|
|
401
|
|
||
Other assets
|
|
4,808
|
|
|
344
|
|
||
Total assets
|
|
$
|
155,335
|
|
|
$
|
51,975
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
4,256
|
|
|
$
|
6,647
|
|
Accrued compensation
|
|
2,552
|
|
|
4,133
|
|
||
Other current liabilities
|
|
3,296
|
|
|
3,896
|
|
||
Deferred revenue
|
|
4,920
|
|
|
4,424
|
|
||
Total current liabilities
|
|
15,024
|
|
|
19,100
|
|
||
Long-term deferred revenue
|
|
33,665
|
|
|
22,303
|
|
||
Other long-term liabilities
|
|
1,374
|
|
|
915
|
|
||
Total liabilities
|
|
50,063
|
|
|
42,318
|
|
||
Contingencies (Note 12)
|
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
|
||||
Common stock and additional paid-in capital — $0.001 par value; 100,000,000 shares authorized; 37,043,975 and 35,950,518 shares issued, respectively; 30,357,285 and 29,263,828 shares outstanding, respectively
|
|
235,438
|
|
|
228,046
|
|
||
Accumulated other comprehensive income
|
|
104
|
|
|
99
|
|
||
Accumulated deficit
|
|
(83,398
|
)
|
|
(171,616
|
)
|
||
Treasury stock at cost: 6,686,690 shares
|
|
(46,872
|
)
|
|
(46,872
|
)
|
||
Total stockholders’ equity
|
|
105,272
|
|
|
9,657
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
155,335
|
|
|
$
|
51,975
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Revenues:
|
|
|
|
|
||||
Royalty and license
|
|
$
|
85,335
|
|
|
$
|
9,006
|
|
Development, services, and other
|
|
81
|
|
|
218
|
|
||
Total revenues
|
|
85,416
|
|
|
9,224
|
|
||
Costs and expenses:
|
|
|
|
|
||||
Cost of revenues
|
|
35
|
|
|
43
|
|
||
Sales and marketing
|
|
1,220
|
|
|
3,305
|
|
||
Research and development
|
|
2,820
|
|
|
3,196
|
|
||
General and administrative
|
|
11,236
|
|
|
15,532
|
|
||
Total costs and expenses
|
|
15,311
|
|
|
22,076
|
|
||
Operating income (loss)
|
|
70,105
|
|
|
(12,852
|
)
|
||
Interest and other income
|
|
231
|
|
|
139
|
|
||
Income (loss) before provision for income taxes
|
|
70,336
|
|
|
(12,713
|
)
|
||
Provision for income taxes
|
|
(453
|
)
|
|
(152
|
)
|
||
Net income (loss)
|
|
$
|
69,883
|
|
|
$
|
(12,865
|
)
|
Basic net income (loss) per share
|
|
$
|
2.35
|
|
|
$
|
(0.44
|
)
|
Shares used in calculating basic net income (loss) per share
|
|
29,700
|
|
|
29,024
|
|
||
Diluted net income (loss) per share
|
|
$
|
2.29
|
|
|
$
|
(0.44
|
)
|
Shares used in calculating diluted net income (loss) per share
|
|
30,566
|
|
|
29,024
|
|
||
Other comprehensive income (loss), net of tax
|
|
|
|
|
||||
Change in unrealized gains (losses) on short-term investments
|
|
5
|
|
|
(22
|
)
|
||
Total other comprehensive income (loss)
|
|
5
|
|
|
(22
|
)
|
||
Total comprehensive income (loss)
|
|
$
|
69,888
|
|
|
$
|
(12,887
|
)
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Cash flows provided by (used in) operating activities:
|
|
|
|
|
||||
Net income (loss)
|
|
$
|
69,883
|
|
|
$
|
(12,865
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
|
||||
Depreciation and amortization of property and equipment
|
|
227
|
|
|
232
|
|
||
Stock-based compensation
|
|
1,222
|
|
|
1,557
|
|
||
Deferred income taxes
|
|
67
|
|
|
—
|
|
||
Loss on disposal of equipment
|
|
26
|
|
|
—
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Accounts and other receivables
|
|
(1,861
|
)
|
|
(527
|
)
|
||
Prepaid expenses and other current assets
|
|
116
|
|
|
150
|
|
||
Other assets
|
|
(4,524
|
)
|
|
(55
|
)
|
||
Accounts payable
|
|
(2,391
|
)
|
|
1,000
|
|
||
Accrued compensation and other current liabilities
|
|
(2,181
|
)
|
|
(1,741
|
)
|
||
Deferred revenue
|
|
25,197
|
|
|
(2,046
|
)
|
||
Other long-term liabilities
|
|
422
|
|
|
(22
|
)
|
||
Net cash provided by (used in) operating activities
|
|
86,203
|
|
|
(14,317
|
)
|
||
Cash flows provided by (used in) investing activities:
|
|
|
|
|
||||
Purchases of short-term investments
|
|
(8,861
|
)
|
|
(9,931
|
)
|
||
Proceeds from maturities of short-term investments
|
|
11,000
|
|
|
10,000
|
|
||
Purchases of property and equipment
|
|
(6
|
)
|
|
(83
|
)
|
||
Net cash provided by (used in) investing activities
|
|
2,133
|
|
|
(14
|
)
|
||
Cash flows provided by financing activities:
|
|
|
|
|
||||
Issuance of common stock under employee stock purchase plan
|
|
98
|
|
|
175
|
|
||
Exercise of stock options
|
|
6,072
|
|
|
401
|
|
||
Net cash provided by financing activities
|
|
6,170
|
|
|
576
|
|
||
Net increase (decrease) in cash and cash equivalents
|
|
94,506
|
|
|
(13,755
|
)
|
||
Cash and cash equivalents:
|
|
|
|
|
||||
Beginning of period
|
|
24,622
|
|
|
56,865
|
|
||
End of period
|
|
$
|
119,128
|
|
|
$
|
43,110
|
|
Supplemental disclosure of cash flow information
|
|
|
|
|
||||
Cash paid for taxes
|
|
$
|
90
|
|
|
$
|
39
|
|
Supplemental disclosure of noncash operating, investing, and financing activities
|
|
|
|
|
||||
Amounts accrued for property and equipment
|
|
$
|
—
|
|
|
$
|
11
|
|
Release of Restricted Stock Units and Awards under company stock plan
|
|
$
|
1,860
|
|
|
$
|
1,768
|
|
(in thousands)
|
|
Balance at December 31, 2017
as Reported
under ASC 605
|
|
Adjustment
for Fixed Fee License Revenue *
|
|
Elimination of Quarter-Lag
Per-Unit Royalties
|
|
Total Adjustments upon Adoption of ASC 606
|
|
Balance at January 1, 2018
(ASC 606)
|
|||||||||
Prepaid expenses and other current assets
|
|
$
|
736
|
|
|
|
|
$
|
4,996
|
|
|
$
|
4,996
|
|
|
$
|
5,732
|
|
|
Deferred revenue - current
|
|
(4,424
|
)
|
|
1,766
|
|
|
|
|
1,766
|
|
|
(2,658
|
)
|
|||||
Long-term deferred revenue
|
|
(22,303
|
)
|
|
11,573
|
|
|
|
|
11,573
|
|
|
(10,730
|
)
|
|||||
Accumulated deficit
|
|
171,616
|
|
|
(13,339
|
)
|
|
(4,996
|
)
|
|
(18,335
|
)
|
|
153,281
|
|
(in thousands)
|
|
Three Months Ended March 31,
|
|
|
||||||||
|
|
2018
|
|
2017
|
|
Increase (Decrease)
|
||||||
Fixed fee license revenue
|
|
75,756
|
|
|
2,510
|
|
|
73,246
|
|
|
2,918
|
%
|
Per-Unit royalty revenue
|
|
9,579
|
|
|
6,496
|
|
|
3,083
|
|
|
47
|
%
|
Total royalty and license revenue
|
|
85,335
|
|
|
9,006
|
|
|
76,329
|
|
|
848
|
%
|
Development, services, and other revenue
|
|
81
|
|
|
218
|
|
|
(137
|
)
|
|
(63
|
)%
|
Total revenues
|
|
85,416
|
|
|
9,224
|
|
|
76,192
|
|
|
826
|
%
|
|
|
Three Months Ended March 31,
|
||||||||||||||
|
|
2018
|
|
2017
|
||||||||||||
|
|
As Reported
(ASC 606) |
|
Adjustments
|
|
ASC 605
|
|
As Reported (ASC 605)
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Fixed fee license revenue
|
|
$
|
75,756
|
|
|
$
|
(72,341
|
)
|
|
$
|
3,415
|
|
|
$
|
2,510
|
|
Per-unit royalty revenue
|
|
9,579
|
|
|
(4,351
|
)
|
|
5,228
|
|
|
6,496
|
|
||||
Total royalty and license revenue
|
|
85,335
|
|
|
(76,692
|
)
|
|
8,643
|
|
|
9,006
|
|
||||
Development, services, and other revenue
|
|
81
|
|
|
—
|
|
|
81
|
|
|
218
|
|
||||
Total revenues
|
|
$
|
85,416
|
|
|
$
|
(76,692
|
)
|
|
$
|
8,724
|
|
|
$
|
9,224
|
|
Operating expenses
|
|
15,311
|
|
|
—
|
|
|
15,311
|
|
|
22,076
|
|
||||
Operating income (loss)
|
|
70,105
|
|
|
(76,692
|
)
|
|
(6,587
|
)
|
|
(12,852
|
)
|
||||
Interest and other income
|
|
231
|
|
|
—
|
|
|
231
|
|
|
139
|
|
||||
Income (loss) before provision for income taxes
|
|
70,336
|
|
|
(76,692
|
)
|
|
(6,356
|
)
|
|
(12,713
|
)
|
||||
Income tax provision
|
|
(453
|
)
|
|
—
|
|
|
(453
|
)
|
|
(152
|
)
|
||||
Net income (loss)
|
|
$
|
69,883
|
|
|
$
|
(76,692
|
)
|
|
$
|
(6,809
|
)
|
|
$
|
(12,865
|
)
|
Basic net income (loss) per share
|
|
$
|
2.35
|
|
|
$
|
(2.58
|
)
|
|
$
|
(0.23
|
)
|
|
$
|
(0.44
|
)
|
Diluted net income (loss) per share
|
|
$
|
2.29
|
|
|
$
|
(2.51
|
)
|
|
$
|
(0.22
|
)
|
|
$
|
(0.44
|
)
|
(in thousands)
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||
|
|
As Reported
(ASC 606) |
|
Adjustments
|
|
ASC 605
|
|
As Reported (ASC 605)
|
||||
Prepaid expenses and other current assets
|
|
5,616
|
|
|
(4,847
|
)
|
|
769
|
|
|
736
|
|
Other non-current assets
|
|
4,808
|
|
|
(4,500
|
)
|
|
308
|
|
|
344
|
|
Deferred revenue - current
|
|
(4,920
|
)
|
|
(9,521
|
)
|
|
(14,441
|
)
|
|
(4,424
|
)
|
Long-term deferred revenue
|
|
(33,665
|
)
|
|
(76,160
|
)
|
|
(109,825
|
)
|
|
(22,303
|
)
|
Accumulated Deficit
|
|
83,398
|
|
|
95,027
|
|
|
178,425
|
|
|
171,616
|
|
|
|
March 31, 2018
|
|
|
||||||||||||
|
|
Fair value measurements using
|
|
|
||||||||||||
(in thousands)
|
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
|
$
|
—
|
|
|
$
|
19,842
|
|
|
$
|
—
|
|
|
$
|
19,842
|
|
Money market accounts
|
|
56,273
|
|
|
—
|
|
|
—
|
|
|
56,273
|
|
||||
Total assets at fair value
|
|
$
|
56,273
|
|
|
$
|
19,842
|
|
|
$
|
—
|
|
|
$
|
76,115
|
|
|
|
December 31, 2017
|
|
|
||||||||||||
|
|
Fair value measurements using
|
|
|
||||||||||||
(in thousands)
|
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
|
$
|
—
|
|
|
$
|
21,916
|
|
|
$
|
—
|
|
|
$
|
21,916
|
|
Money market accounts
|
|
1,117
|
|
|
—
|
|
|
—
|
|
|
1,117
|
|
||||
Total assets at fair value
|
|
$
|
1,117
|
|
|
$
|
21,916
|
|
|
$
|
—
|
|
|
$
|
23,033
|
|
|
|
March 31, 2018
|
||||||||||||||
(in thousands)
|
|
Amortized
Cost
|
|
Gross
Unrealized
Holding
Gains
|
|
Gross
Unrealized
Holding
Losses
|
|
Fair
Value
|
||||||||
U.S. Treasury securities
|
|
$
|
19,860
|
|
|
$
|
—
|
|
|
$
|
(18
|
)
|
|
$
|
19,842
|
|
Total
|
|
$
|
19,860
|
|
|
$
|
—
|
|
|
$
|
(18
|
)
|
|
$
|
19,842
|
|
|
|
December 31, 2017
|
||||||||||||||
(in thousands)
|
|
Amortized
Cost
|
|
Gross
Unrealized
Holding
Gains
|
|
Gross
Unrealized
Holding
Losses
|
|
Fair
Value
|
||||||||
U.S. Treasury securities
|
|
$
|
21,939
|
|
|
$
|
—
|
|
|
$
|
(23
|
)
|
|
$
|
21,916
|
|
Total
|
|
$
|
21,939
|
|
|
$
|
—
|
|
|
$
|
(23
|
)
|
|
$
|
21,916
|
|
(in thousands)
|
|
March 31, 2018
|
|
December 31, 2017
|
||||
Trade accounts receivable
|
|
$
|
2,279
|
|
|
$
|
458
|
|
Other receivables
|
|
388
|
|
|
348
|
|
||
Accounts and other receivables
|
|
$
|
2,667
|
|
|
$
|
806
|
|
(in thousands)
|
|
March 31, 2018
|
|
December 31, 2017
|
||||
Computer equipment and purchased software
|
|
$
|
3,212
|
|
|
$
|
3,206
|
|
Machinery and equipment
|
|
834
|
|
|
834
|
|
||
Furniture and fixtures
|
|
1,146
|
|
|
1,274
|
|
||
Leasehold improvements
|
|
3,920
|
|
|
3,920
|
|
||
Total
|
|
9,112
|
|
|
9,234
|
|
||
Less accumulated depreciation
|
|
(6,209
|
)
|
|
(6,084
|
)
|
||
Property and equipment, net
|
|
$
|
2,903
|
|
|
$
|
3,150
|
|
(in thousands)
|
|
March 31, 2018
|
|
December 31, 2017
|
||||
Accrued legal
|
|
$
|
2,182
|
|
|
$
|
2,202
|
|
Income taxes payable
|
|
118
|
|
|
219
|
|
||
Other current liabilities
|
|
996
|
|
|
1,475
|
|
||
Total other current liabilities
|
|
$
|
3,296
|
|
|
$
|
3,896
|
|
|
|
Three Months Ended March 31, 2018
|
||||||||||||||
(in thousands)
|
|
Employee Separation Costs
|
|
Asset-Related Charges
|
|
Other
|
|
Total
|
||||||||
Restructuring
|
|
$
|
(44
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(44
|
)
|
|
|
Three Months Ended March 31, 2018
|
||||||||||||||
(in thousands)
|
|
Employee Separation Costs
|
|
Asset-Related Charges
|
|
Other
|
|
Total
|
||||||||
Balance as of December 31, 2017
|
|
$
|
1,522
|
|
|
$
|
—
|
|
|
$
|
57
|
|
|
$
|
1,579
|
|
Charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Adjustments
|
|
(44
|
)
|
|
—
|
|
|
—
|
|
|
(44
|
)
|
||||
Non-cash activity
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
(26
|
)
|
||||
Cash Payments
|
|
(1,468
|
)
|
|
—
|
|
|
|
|
|
(1,468
|
)
|
||||
Balance as of March 31, 2018
|
|
10
|
|
|
—
|
|
|
31
|
|
|
41
|
|
|
March 31, 2018
|
|
Common stock shares available for grant
|
1,653,597
|
|
Standard and market condition stock options outstanding
|
2,726,207
|
|
Restricted stock awards outstanding
|
44,538
|
|
RSU's outstanding
|
1,210,086
|
|
|
Three Months Ended March 31, 2018
|
||
Shares purchased under ESPP
|
13,834
|
|
|
Average price of shares purchased under ESPP
|
$
|
7.11
|
|
Intrinsic value of shares purchased under ESPP
|
$
|
45,000
|
|
|
|
Three Months Ended March 31, 2018
|
||
Beginning outstanding balance
|
|
3,277,991
|
|
|
Granted
|
|
167,500
|
|
|
Exercised
|
|
(922,842
|
)
|
|
Forfeited
|
|
(25,103
|
)
|
|
Expired
|
|
(43,420
|
)
|
|
Ending outstanding balance
|
|
2,454,126
|
|
|
Aggregate intrinsic value of options exercised
|
|
$
|
4,726,000
|
|
Weighted average fair value of options granted
|
|
$
|
5.48
|
|
|
|
Number of
Shares
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Life (years)
|
|
Aggregate
Intrinsic
Value
(in millions)
|
|||||
March 31, 2018
|
|
|
|
|
|
|
|
|
|||||
Options outstanding
|
|
2,454,126
|
|
|
$
|
8.69
|
|
|
3.42
|
|
$
|
8.0
|
|
Options vested and expected to vest using estimated forfeiture rates
|
|
2,334,242
|
|
|
8.66
|
|
|
3.28
|
|
7.7
|
|
||
Options exercisable
|
|
1,730,105
|
|
|
$
|
8.56
|
|
|
2.33
|
|
$
|
5.9
|
|
|
|
Three Months Ended March 31, 2018
|
||
Beginning outstanding balance
|
|
508,880
|
|
|
Awarded
|
|
912,793
|
|
|
Released
|
|
(156,781
|
)
|
|
Forfeited
|
|
(54,806
|
)
|
|
Ending outstanding balance
|
|
1,210,086
|
|
|
Weighted average fair value on grant date of RSUs
|
|
$
|
11.84
|
|
Total fair value of RSUs released
|
|
$
|
1,860,000
|
|
|
|
Number of
Shares
|
|
Weighted
Average
Remaining
Contractual
Life (years)
|
|
Aggregate
Intrinsic
Value
(in millions)
|
|||
March 31, 2018
|
|
|
|
|
|
|
|||
RSUs outstanding
|
|
1,210,086
|
|
|
1.35
|
|
$
|
14.5
|
|
RSUs vested and expected to vest using estimated forfeiture rates
|
|
938,701
|
|
|
1.25
|
|
$
|
11.2
|
|
|
|
Three Months Ended March 31, 2018
|
||
Beginning outstanding balance
|
|
44,538
|
|
|
Awarded
|
|
—
|
|
|
Released
|
|
—
|
|
|
Forfeited
|
|
—
|
|
|
Ending outstanding balance
|
|
44,538
|
|
|
Weighted average grant date fair value of restricted stock awarded
|
|
$
|
—
|
|
Total fair value of restricted stock awards released
|
|
—
|
|
|
|
Three Months Ended March 31,
|
|
||||
|
|
2018
|
|
2017
|
|
||
Standard Stock Options
|
|
|
|
|
|
||
Expected life (in years)
|
|
4.4
|
|
|
4.6
|
|
|
Volatility
|
|
54
|
%
|
|
56
|
%
|
|
Interest rate
|
|
2.5
|
%
|
|
1.9
|
%
|
|
Dividend yield
|
|
N/A
|
|
|
N/A
|
|
|
|
|
Three Months Ended March 31,
|
|
||||
|
|
2018
|
|
2017
|
|
||
Market Condition Based Stock Options
|
|
|
|
|
|
||
Expected life (in years)
|
|
7.0
|
|
|
7.0
|
|
|
Volatility
|
|
59
|
%
|
|
59
|
%
|
|
Interest rate
|
|
1.6
|
%
|
|
1.6
|
%
|
|
Dividend yield
|
|
N/A
|
|
|
N/A
|
|
|
|
|
Three Months Ended March 31,
|
|
||||
|
|
2018
|
|
2017
|
|
||
Employee Stock Purchase Plan
|
|
|
|
|
|
||
Expected life (in years)
|
|
0.5
|
|
|
0.5
|
|
|
Volatility
|
|
74
|
%
|
|
50
|
%
|
|
Interest rate
|
|
1.7
|
%
|
|
0.7
|
%
|
|
Dividend yield
|
|
N/A
|
|
|
N/A
|
|
|
(in thousands)
|
|
Three Months Ended March 31,
|
|
||||||
|
|
2018
|
|
2017
|
|
||||
Statement of Operations Classifications
|
|
|
|
|
|
||||
Sales and marketing
|
|
$
|
(67
|
)
|
|
$
|
210
|
|
|
Research and development
|
|
256
|
|
|
336
|
|
|
||
General and administrative
|
|
1,033
|
|
|
1,011
|
|
|
||
Total
|
|
$
|
1,222
|
|
|
$
|
1,557
|
|
|
|
|
Three Months Ended March 31, 2018
|
||||||||||
(in thousands)
|
|
Unrealized Gains
and Losses on
Short-term Investments
|
|
Foreign
Currency
Items
|
|
Total
|
||||||
Beginning balance
|
|
$
|
(23
|
)
|
|
$
|
122
|
|
|
$
|
99
|
|
Other comprehensive income before reclassifications
|
|
5
|
|
|
—
|
|
|
5
|
|
|||
Amounts reclassified from accumulated other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net current period other comprehensive income
|
|
5
|
|
|
—
|
|
|
5
|
|
|||
Ending Balance
|
|
$
|
(18
|
)
|
|
$
|
122
|
|
|
$
|
104
|
|
(in thousands)
|
|
Three Months Ended March 31,
|
|
||||||
|
|
2018
|
|
2017
|
|
||||
Income (loss) from continuing operations before provision for income taxes
|
|
$
|
70,336
|
|
|
$
|
(12,713
|
)
|
|
Provision for income taxes
|
|
$
|
(453
|
)
|
|
$
|
(152
|
)
|
|
Effective tax rate
|
|
0.6
|
%
|
|
(1.2
|
)%
|
|
|
|
Three months ended March 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(in thousands, except
per share amounts)
|
||||||
Numerator:
|
|
|
|
|
||||
Net income (loss)
|
|
$
|
69,883
|
|
|
$
|
(12,865
|
)
|
Denominator:
|
|
|
|
|
||||
Shares used in computation of basic net income (loss) per share (weighted average common shares outstanding)
|
|
29,700
|
|
|
29,024
|
|
||
Dilutive potential common shares:
|
|
|
|
|
||||
Stock options, ESPP, restricted Stock and RSUs
|
|
866
|
|
|
—
|
|
||
Shares used in computation of diluted net income (loss) per share
|
|
30,566
|
|
|
29,024
|
|
||
Basic net income (loss) per share
|
|
$
|
2.35
|
|
|
$
|
(0.44
|
)
|
Diluted net income (loss) per share
|
|
$
|
2.29
|
|
|
$
|
(0.44
|
)
|
|
|
March 31, 2017
|
|
Standard and market condition stock options outstanding
|
|
3,616,995
|
|
Restricted stock awards outstanding
|
|
77,540
|
|
RSUs outstanding
|
|
403,935
|
|
ESPP
|
|
11,889
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
Components of Changes
|
|||||||||||||||||
(in thousands)
|
|
2018
|
|
2017
|
|
Change
|
|
Change
%
|
|
Due to
ASC 606 Adoption
|
Net of ASC 606 Adoption Effect
|
Total
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Fixed fee license revenue
|
|
$
|
75,756
|
|
|
$
|
2,510
|
|
|
$
|
73,246
|
|
|
2,918
|
%
|
|
$
|
72,341
|
|
$
|
905
|
|
$
|
73,246
|
|
Per-unit royalty revenue
|
|
9,579
|
|
|
6,496
|
|
|
3,083
|
|
|
47
|
%
|
|
4,351
|
|
(1,268
|
)
|
3,083
|
|
||||||
Total royalty and license revenue
|
|
85,335
|
|
|
9,006
|
|
|
76,329
|
|
|
848
|
%
|
|
76,692
|
|
(363
|
)
|
76,329
|
|
||||||
Development, services, and other
|
|
81
|
|
|
218
|
|
|
(137
|
)
|
|
(63
|
)%
|
|
—
|
|
(137
|
)
|
(137
|
)
|
||||||
Total Revenues
|
|
$
|
85,416
|
|
|
$
|
9,224
|
|
|
$
|
76,192
|
|
|
826
|
%
|
|
$
|
76,692
|
|
$
|
(500
|
)
|
$
|
76,192
|
|
|
|
March 31,
|
|
Change
|
|
% Change
|
|||||||||
(in thousands)
|
|
2018
|
|
2017
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
Sales and marketing
|
|
$
|
1,220
|
|
|
$
|
3,305
|
|
|
$
|
(2,085
|
)
|
|
(63
|
)%
|
% of total revenue
|
|
1
|
%
|
|
36
|
%
|
|
(35
|
)%
|
|
|
||||
Research and development
|
|
$
|
2,820
|
|
|
$
|
3,196
|
|
|
$
|
(376
|
)
|
|
(12
|
)%
|
% of total revenue
|
|
3
|
%
|
|
35
|
%
|
|
(32
|
)%
|
|
|
||||
General and administrative
|
|
$
|
11,236
|
|
|
$
|
15,532
|
|
|
$
|
(4,296
|
)
|
|
(28
|
)%
|
% of total revenue
|
|
13
|
%
|
|
168
|
%
|
|
(155
|
)%
|
|
|
|
|
March 31,
|
|
Change
|
|
% Change
|
|||||||||
|
|
2018
|
|
2017
|
|
|
|
|
|||||||
|
|
(Dollars in thousands)
|
|
|
|
|
|||||||||
Three months ended:
|
|
|
|
|
|
|
|
|
|||||||
Provision for income taxes
|
|
$
|
(453
|
)
|
|
$
|
(152
|
)
|
|
$
|
(301
|
)
|
|
198
|
%
|
Income (loss) before provision for income taxes
|
|
70,336
|
|
|
(12,713
|
)
|
|
|
|
|
|||||
Effective tax rate
|
|
0.6
|
%
|
|
(1.2
|
)%
|
|
|
|
|
|
|
|
|
IMMERSION CORPORATION
|
|
|
|
|
|
By
|
/s/ Nancy Erba
|
|
|
Nancy Erba
|
|
|
Chief Financial Officer and Principal Accounting Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit
Number
|
|
Exhibit Description
|
|
Incorporated by Reference
|
|
Filed
Herewith
|
|||||||
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
||||
|
|
8-K/A
|
|
000-27969
|
|
10.2
|
|
|
January 3, 2018
|
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
|||
|
|
|
|
|
|
|
|
|
|
X
|
|||
|
|
|
|
|
|
|
|
|
|
X
|
|||
|
|
|
|
|
|
|
|
|
|
X
|
|||
|
|
|
|
|
|
|
|
|
|
X
|
|||
|
|
|
|
|
|
|
|
|
|
X
|
|||
|
|
|
|
|
|
|
|
|
|
X
|
|||
101.INS
|
|
XBRL Report Instance Document
|
|
|
|
|
|
|
|
|
|
X
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
|
|
X
|
|
101.CAL
|
|
XBRL Taxonomy Calculation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
101.LAB
|
|
XBRL Taxonomy Label Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
101.PRE
|
|
XBRL Presentation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
#
|
Certain portions of this exhibit have been omitted and filed separately with the SEC pursuant to a request for confidential treatment under Rule 24b-2 as promulgated under the Exchange Act.
|
*
|
This certification is deemed not filed for purposes of section 18 of the Exchange Act or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act.
|
**
|
Constitutes a management contract or compensatory plan.
|
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. PORTIONS OF THIS DOCUMENT FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED HAVE BEEN REDACTED AND ARE MARKED HEREIN BY “[***]”. SUCH REDACTED INFORMATION HAS BEEN FILED SEPARATELY WITH THE COMMISSION PURSUANT TO THE CONFIDENTIAL TREATMENT REQUEST.
|
2.0
|
LICENSE AND RELEASE.
|
2.3
|
Release
.
|
6.0
|
ASSIGNABILITY.
|
7.0
|
CONFIDENTIALITY.
|
8.0
|
NOTICES.
|
For Apple
:
|
And with a copy to:
|
General Counsel
Apple Inc. One Apple Park, 301-4GC Cupertino, CA 95014 Fax: (408) 974-8530 |
Chief IP Counsel
Apple Inc. One Apple Park, 169-3IPL Cupertino, CA 95014 Fax: (408) 974-4992 |
|
And (for Section 7 notices only) with a copy to:
prod_requests@apple.com
|
For Immersion:
|
|
General Counsel
Immersion Corporation
50 Rio Robles
San Jose, California 95134
|
|
9.0
|
MISCELLANEOUS.
|
APPLE INC.
|
IMMERSION CORP.
|
|
|
By: /s/ Noreen Krall
|
By: /s/ Carl Schlachte
|
Name: Noreen Krall
Its: Vice President, Chief Litigation Counsel
|
Name: Carl Schlachte
Its: Interim Chief Executive Officer
|
Dated: January 26, 2018
|
Dated: January 26, 2018
|
|
|
|
|
In the Matter of:
|
|
|
|
CERTAIN MOBILE ELECTRONIC DEVICES
|
|
INCORPORATING HAPTICS (INCLUDING
|
Inv. No. 337-TA-1004
|
SMARTPHONES AND SMARTWATCHES)
|
Inv. No. 337-TA-990
|
AND COMPONENTS THEREOF
|
(Consolidated)
|
|
|
CERTAIN MOBILE AND PORTABLE
|
|
ELECTRONIC DEVICES INCORPORATING
|
|
HAPTICS (INCLUDING SMARTPHONES
|
|
AND LAPTOPS) AND COMPONENTS
|
|
THEREOF
|
|
|
|
•
|
Exhibit __ [Confidential Agreement]
|
•
|
Exhibit __ [Public Version]
|
/s/
|
|
/s/
|
Morgan Chu
|
|
Mark D. Fowler
|
Richard Birnholz
|
|
Christine Corbett
|
Lisa Glasser
|
|
Robert Buergi
|
Rebecca Carson
|
|
DLA PIPER LLP (US)
|
Babak Redjaian
|
|
2000 University Avenue
|
Maclain Wells
|
|
East Palo Alto, CA 94303-2215
|
Tony Rowles
|
|
Telephone: (650) 833-2000
|
Stephen Payne
|
|
Facsimile: (650) 833-2001
|
Irell & Manella LLP
|
|
|
1800 Avenue of the Stars, Suite 900
|
|
Sean C. Cunningham
|
Los Angeles, CA 90067
|
|
Erin P. Gibson
|
Telephone: (310) 277-1010
|
|
Robert Williams
|
Facsimile: (310) 203-7199
|
|
DLA PIPER LLP (US)
|
|
|
401 B Street, Suite 2000
|
Barbara A. Murphy
|
|
San Diego, CA 92101-4240
|
David F. Nickel
|
|
Telephone: (619) 699-2700
|
Kandis C. Gibson
|
|
Facsimile: (619) 699-2701
|
Foster, Murphy, Altman & Nickel, PC
|
|
|
1899 L Street NW #1150
|
|
Brian Erickson
|
Washington, DC 20036
|
|
DLA PIPER LLP (US)
|
Telephone: (202) 822-4100
|
|
401 Congress Avenue, Suite 2500
|
Facsimile: (202) 822-4199
|
|
Austin, Texas 78701-3799
|
|
|
Telephone: (512) 457-7000
|
Counsel for Complainant Immersion
|
|
Facsimile: (512) 457-7001
|
Corporation
|
|
|
|
|
Counsel for Respondents Apple Inc. and
|
|
|
AT&T Mobility LLC
|
|
|
|
|
|
/s/
|
|
|
Josh Krevitt
|
|
|
Benjamin Hershkowitz
|
|
|
George Stamatopoulos
|
|
|
GIBSON, DUNN & CRUTCHER LLP
|
|
|
200 Park Ave
|
|
|
New York, NY 10166-0193
|
|
|
|
|
|
Mark Reiter
|
|
|
GIBSON, DUNN & CRUTCHER LLP
|
|
|
2100 McKinney Ave Ste 1100
|
|
|
Dallas, TX 75201-6912
|
|
|
Telephone: (214) 698-3100
|
|
|
Eric T. Syu
|
|
|
GIBSON, DUNN & CRUTCHER LLP
|
|
|
3161 Michelson Dr.
|
|
|
Irvine, CA 92612-4412
|
|
|
Telephone: (949) 451-3800
|
|
|
|
|
|
Jill M. McCormack
|
|
|
GIBSON, DUNN & CRUTCHER LLP
|
|
|
1050 Connecticut Ave NW
|
|
|
Washington, DC 20036-5306
|
|
|
Telephone: (202) 955-8500
|
|
|
|
|
|
Counsel for Respondent AT&T Mobility,
|
|
|
LLC
|
|
|
In the Matter of:
|
|
|
|
CERTAIN MOBILE ELECTRONIC DEVICES
|
|
INCORPORATING HAPTICS (INCLUDING
|
Inv. No. 337-TA-1004
|
SMARTPHONES AND SMARTWATCHES)
|
Inv. No. 337-TA-990
|
AND COMPONENTS THEREOF
|
(Consolidated)
|
|
|
CERTAIN MOBILE AND PORTABLE
|
|
ELECTRONIC DEVICES INCORPORATING
|
|
HAPTICS (INCLUDING SMARTPHONES
|
|
AND LAPTOPS) AND COMPONENTS
|
|
THEREOF
|
|
|
|
¹
The Parties filed the following stipulations in this Investigation: (1) Joint Initial Discovery Stipulations (Apr. 11, 2016) (Doc. ID 578277); (2) Stipulation and Agreement to Terminate AT&T Inc. as a Proposed Respondent (May 9, 2016) (Doc. ID 580714); (3) Stipulation and Agreement Regarding AT&T Accused Products (Aug. 11, 2016) (Doc. ID 587832); (4) Joint Stipulation on Importation and Inventory (Dec. 14, 2016) (Doc. ID 598054); (5) Joint Stipulation on Importation and Inventory (Jan. 11, 2017) (Doc. ID 600692); (6) Stipulation and Agreement Regarding AT&T Accused Products (Mar. 30, 2017) (Doc. ID 607073); (7) Joint Stipulation Regarding Certain Fact Witnesses Not Testifying Live at the Hearing and Admission of Deposition Testimony (Apr. 14, 2017) (Doc. ID 608746); and (8) Joint Stipulation Regarding the Treatment of Source Code Exhibits at Trial (Apr. 28, 2017) (Doc. ID 610033).
|
/s/
|
|
/s/
|
Morgan Chu
|
|
Mark D. Fowler
|
Richard Birnholz
|
|
Christine Corbett
|
Lisa Glasser
|
|
Robert Buergi
|
Rebecca Carson
|
|
DLA PIPER LLP (US)
|
Babak Redjaian
|
|
2000 University Avenue
|
Maclain Wells
|
|
East Palo Alto, CA 94303-2215
|
Tony Rowles
|
|
Telephone: (650) 833-2000
|
Stephen Payne
|
|
Facsimile: (650) 833-2001
|
Irell & Manella LLP
|
|
|
1800 Avenue of the Stars, Suite 900
|
|
Sean C. Cunningham
|
Los Angeles, CA 90067
|
|
Erin P. Gibson
|
Telephone: (310) 277-1010
|
|
Robert Williams
|
Facsimile: (310) 203-7199
|
|
DLA PIPER LLP (US)
|
|
|
401 B Street, Suite 2000
|
Barbara A. Murphy
|
|
San Diego, CA 92101-4240
|
David F. Nickel
|
|
Telephone: (619) 699-2700
|
Kandis C. Gibson
|
|
Facsimile: (619) 699-2701
|
Foster, Murphy, Altman & Nickel, PC
|
|
|
1899 L Street NW #1150
|
|
Brian Erickson
|
Washington, DC 20036
|
|
DLA PIPER LLP (US)
|
Telephone: (202) 822-4100
|
|
401 Congress Avenue, Suite 2500
|
Facsimile: (202) 822-4199
|
|
Austin, Texas 78701-3799
|
|
|
Telephone: (512) 457-7000
|
Counsel for Complainant Immersion
|
|
Facsimile: (512) 457-7001
|
Corporation
|
|
|
|
|
Counsel for Respondents Apple Inc. and
|
|
|
AT&T Mobility LLC
|
|
|
|
|
|
/s/
|
|
|
Josh Krevitt
|
|
|
Benjamin Hershkowitz
|
|
|
George Stamatopoulos
|
|
|
GIBSON, DUNN & CRUTCHER LLP
|
|
|
200 Park Ave
|
|
|
New York, NY 10166-0193
|
|
|
Telephone: (212) 351-4000
|
|
|
|
|
|
Mark Reiter
|
|
|
GIBSON, DUNN & CRUTCHER LLP
|
|
|
2100 McKinney Ave Ste 1100
|
|
|
Dallas, TX 75201-6912
|
|
|
Telephone: (214) 698-3100
|
|
|
|
|
|
2100 McKinney Ave Ste 1100
|
|
|
Dallas, TX 75201-6912
|
|
|
Telephone: (214) 698-3100
|
|
|
|
|
|
Eric T. Syu
|
|
|
GIBSON, DUNN & CRUTCHER LLP
|
|
|
3161 Michelson Dr.
|
|
|
Irvine, CA 92612-4412
|
|
|
Telephone: (949) 451-3800
|
|
|
|
|
|
Jill M. McCormack
|
|
|
GIBSON, DUNN & CRUTCHER LLP
|
|
|
1050 Connecticut Ave NW
|
|
|
Washington, DC 20036-5306
|
|
|
Telephone: (202) 955-8500
|
|
|
|
|
|
Counsel for Respondent AT&T Mobility,
|
|
|
LLC
|
Ex. No.
|
Description
|
|
|
|
|
IMMERSION CORPORATION,
Plaintiff,
vs.
APPLE INC.,
AT&T INC., and
AT&T MOBILITY LLC,
Defendants.
|
)
)
)
)
)
)
)
)
)
)
)
|
C.A. No. 16-077 (RGA)
|
FARNAN LLP
|
|
DLA PIPER LLP (US)
|
/s/
|
|
/s/
|
Brian E. Farnan (#4089)
|
|
Denise S. Kraft (#2778)
|
Michael J. Farnan (#5165)
|
|
Brian A. Biggs (#5591)
|
919 North Market Street, 12th Floor
|
|
1201 North Market Street, Suite 2100
|
Wilmington, DE 19801
|
|
Wilmington, DE 19801-1147
|
(302) 777-0300
|
|
(302) 468-5700
|
bfarnan@farnanlaw.com
|
|
denise.kraft@dlapiper.com
|
mfarnan@farnanlaw.com
|
|
brian.biggs@dlapiper.com
|
|
|
|
IRELL & MANELLA LLP
|
|
Attorneys for Defendant Apple Inc.
|
Morgan Chu (Cal. #70446)
|
|
|
Richard M. Birnholz (Cal. #151543)
|
|
MORRIS, NICHOLS, ARSHT & TUNNELL LLP
|
Lisa S. Glasser (Cal. #223406)
|
|
|
Babak Redjaian (Cal. #185506)
|
|
/s/
|
1800 Avenue of the Stars, Suite 900
|
|
Karen Jacobs (#2881)
|
Los Angeles, CA 90067
|
|
1201 North Market Street
|
Telephone: (310) 277-1010
|
|
P.O. Box 1347
|
Facsimile: (310) 203-7199
|
|
Wilmington, DE 19899-1347
|
|
|
(302) 658-9200
|
Attorneys for Plaintiff Immersion
|
|
kjacobs@mnat.com
|
Corporation
|
|
|
|
|
Attorneys for Defendants AT&T Inc. and
|
|
|
AT&T Mobility LLC
|
IMMERSION CORPORATION,
Plaintiff,
vs.
APPLE INC.,
AT&T INC., and
AT&T MOBILITY LLC,
Defendants.
|
)
)
)
)
)
)
)
)
)
)
)
|
C.A. No. 16-00325 (RGA)
|
FARNAN LLP
|
|
DLA PIPER LLP (US)
|
/s/
|
|
/s/
|
Brian E. Farnan (#4089)
|
|
Denise S. Kraft (#2778)
|
Michael J. Farnan (#5165)
|
|
Brian A. Biggs (#5591)
|
919 North Market Street, 12th Floor
|
|
1201 North Market Street, Suite 2100
|
Wilmington, DE 19801
|
|
Wilmington, DE 19801-1147
|
(302) 777-0300
|
|
(302) 468-5700
|
bfarnan@farnanlaw.com
|
|
denise.kraft@dlapiper.com
|
mfarnan@farnanlaw.com
|
|
brian.biggs@dlapiper.com
|
|
|
|
IRELL & MANELLA LLP
|
|
Attorneys for Defendant Apple Inc.
|
Morgan Chu (Cal. #70446)
|
|
|
Richard M. Birnholz (Cal. #151543)
|
|
MORRIS, NICHOLS, ARSHT & TUNNELL LLP
|
Lisa S. Glasser (Cal. #223406)
|
|
|
Babak Redjaian (Cal. #185506)
|
|
/s/
|
1800 Avenue of the Stars, Suite 900
|
|
Karen Jacobs (#2881)
|
Los Angeles, CA 90067
|
|
1201 North Market Street
|
Telephone: (310) 277-1010
|
|
P.O. Box 1347
|
Facsimile: (310) 203-7199
|
|
Wilmington, DE 19899-1347
|
|
|
(302) 658-9200
|
Attorneys for Plaintiff Immersion
|
|
kjacobs@mnat.com
|
Corporation
|
|
|
|
|
Attorneys for Defendants AT&T Inc. and
|
|
|
AT&T Mobility LLC
|
Date:
|
2/21/2018
|
|
/s/ Nancy Erba
|
|
|
|
Nancy Erba
|
|
|
|
|
|
|
|
Immersion Corporation
|
|
|
|
|
Date:
|
2/26/2018
|
|
By: Carl Schlachte
|
|
|
|
Its:
|
Date:
|
2/21/2018
|
|
/s/ Anne Peters
|
|
|
|
Anne Peters
|
|
|
|
|
|
|
|
Immersion Corporation
|
|
|
|
|
Date:
|
2/26/2018
|
|
By: Carl Schlachte
|
|
|
|
Its:
|
|
|
/s/ CARL SCHLACHTE
|
|
Carl Schlachte
|
|
Interim Chief Executive Officer
|
|
|
|
/s/ Nancy Erba
|
|
Nancy Erba
|
|
Chief Financial Officer
|
|
|
|
/s/ CARL SCHLACHTE
|
|
Carl Schlachte
|
|
Interim Chief Executive Officer
|
|
|
|
/s/ Nancy Erba
|
|
Nancy Erba
|
|
Chief Financial Officer
|
|