Company Quick10K Filing
Cognex
Price56.02 EPS1
Shares175 P/E48
MCap9,819 P/FCF39
Net Debt-845 EBIT163
TEV8,974 TEV/EBIT55
TTM 2019-12-31, in MM, except price, ratios
10-Q 2020-09-27 Filed 2020-10-28
10-Q 2020-06-28 Filed 2020-07-29
10-Q 2020-03-29 Filed 2020-04-27
10-K 2019-12-31 Filed 2020-02-13
10-Q 2019-09-29 Filed 2019-10-28
10-Q 2019-06-30 Filed 2019-07-29
10-Q 2019-03-31 Filed 2019-04-29
10-K 2018-12-31 Filed 2019-02-14
10-Q 2018-09-30 Filed 2018-10-29
10-Q 2018-07-01 Filed 2018-07-30
10-Q 2018-04-01 Filed 2018-04-30
10-K 2017-12-31 Filed 2018-02-15
10-Q 2017-10-01 Filed 2017-10-30
10-Q 2017-07-02 Filed 2017-07-31
10-Q 2017-04-02 Filed 2017-05-01
10-K 2016-12-31 Filed 2017-02-16
10-Q 2016-10-02 Filed 2016-10-31
10-Q 2016-07-03 Filed 2016-08-01
10-Q 2016-04-03 Filed 2016-05-02
10-K 2015-12-31 Filed 2016-02-10
10-Q 2015-10-04 Filed 2015-11-02
10-Q 2015-07-05 Filed 2015-08-03
10-Q 2015-04-05 Filed 2015-05-04
10-K 2014-12-31 Filed 2015-02-12
10-Q 2014-09-28 Filed 2014-10-27
10-Q 2014-06-29 Filed 2014-07-28
10-Q 2014-03-30 Filed 2014-04-30
10-K 2013-12-31 Filed 2014-02-13
10-Q 2013-09-29 Filed 2013-10-28
10-Q 2013-06-30 Filed 2013-07-29
10-Q 2013-03-31 Filed 2013-04-29
10-K 2012-12-31 Filed 2013-02-11
10-Q 2012-09-30 Filed 2012-10-29
10-Q 2012-07-01 Filed 2012-07-30
10-Q 2012-04-01 Filed 2012-04-30
10-K 2011-12-31 Filed 2012-02-09
10-Q 2011-10-02 Filed 2011-11-01
10-Q 2011-07-03 Filed 2011-08-01
10-Q 2011-04-03 Filed 2011-05-02
10-K 2010-12-31 Filed 2011-02-10
10-Q 2010-10-03 Filed 2010-11-01
10-Q 2010-07-04 Filed 2010-08-02
10-Q 2010-04-04 Filed 2010-05-03
10-K 2009-12-31 Filed 2010-02-11
8-K 2020-10-28
8-K 2020-07-29
8-K 2020-05-26
8-K 2020-04-27
8-K 2020-04-23
8-K 2020-03-12
8-K 2020-02-13
8-K 2019-10-28
8-K 2019-10-16
8-K 2019-07-29
8-K 2019-04-25
8-K 2019-04-25
8-K 2019-04-01
8-K 2019-02-14
8-K 2018-10-29
8-K 2018-07-30
8-K 2018-04-30
8-K 2018-04-25
8-K 2018-02-15
8-K 2018-02-15
8-K 2015-08-03
8-K 2015-07-06
8-K 2015-06-08
8-K 2015-05-04
8-K 2015-04-17
8-K 2015-02-07

CGNX 10Q Quarterly Report

Part I: Financial Information
Item 1: Financial Statements
Note 1: Summary of Significant Accounting Policies
Note 2: New Pronouncements
Note 3: Fair Value Measurements
Note 4: Cash, Cash Equivalents, and Investments
Note 5: Inventories
Note 6: Leases
Note 7: Goodwill
Note 8: Intangible Assets
Note 9: Warranty Obligations
Note 10: Derivative Instruments
Note 11: Revenue Recognition
Note 12: Stock - Based Compensation Expense
Note 13: Stock Repurchase Program
Note 14: Income Taxes
Note 15: Weighted - Average Shares
Note 16: Restructuring Charges
Note 17: Subsequent Events
Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3: Quantitative and Qualitative Disclosures About Market Risk
Item 4: Controls and Procedures
Part Ii: Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 a9272020-10qxexhibit311.htm
EX-31.2 a9272020-10qxexhibit312.htm
EX-32.1 a9272020-10qxexhibit321.htm
EX-32.2 a9272020-10qxexhibit322.htm

Cognex Earnings 2020-09-27

Balance SheetIncome StatementCash Flow
1.91.51.10.80.40.02011201420172021
Assets, Equity
0.30.20.10.1-0.0-0.12011201420172021
Rev, G Profit, Net Income
0.10.10.0-0.0-0.1-0.12011201420172021
Ops, Inv, Fin

cgnx-20200927
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549 
FORM 10-Q 
(Mark One)
Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended September 27, 2020 or
Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from __________ to __________

Commission File Number 001-34218
COGNEX CORPORATION
(Exact name of registrant as specified in its charter)
Massachusetts 04-2713778
(State or other jurisdiction of
incorporation or organization)
 (I.R.S. Employer
Identification No.)

One Vision Drive
Natick, Massachusetts 01760-2059
(508) 650-3000
(Address, including zip code, and telephone number, including area code, of principal executive offices)

Securities registered pursuant to the Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $.002 per shareCGNXThe NASDAQ Stock Market LLC

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
 Yes   No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act (Check one):
Large accelerated filer  Accelerated filer
Non-accelerated filer  Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    
 Yes   No  
As of September 27, 2020, there were 174,632,828 shares of Common Stock, $.002 par value per share, of the registrant outstanding.



INDEX
 
PART IFINANCIAL INFORMATION
Financial Statements (interim periods unaudited)

2


PART I: FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS

COGNEX CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
 
 Three-months EndedNine-months Ended
September 27, 2020September 29, 2019September 27, 2020September 29, 2019
 (unaudited)(unaudited)
Revenue$251,073 $183,325 $587,405 $555,856 
Cost of revenue59,741 47,632 151,261 144,883 
Gross margin191,332 135,693 436,144 410,973 
Research, development, and engineering expenses30,240 28,115 96,583 86,436 
Selling, general, and administrative expenses64,206 64,486 193,497 199,542 
Restructuring charges (Note 16)251  15,049  
Intangible asset impairment charges (Note 8)  19,571  
Operating income96,635 43,092 111,444 124,995 
Foreign currency gain (loss)2,357 (1,295)(310)(1,403)
Investment income2,490 5,114 11,010 15,242 
Other income (expense)(173)456 (153)1,239 
Income before income tax expense101,309 47,367 121,991 140,073 
Income tax expense13,803 5,682 15,150 16,535 
Net income$87,506 $41,685 $106,841 $123,538 
Net income per weighted-average common and common-equivalent share:
Basic$0.50 $0.24 $0.62 $0.72 
Diluted$0.49 $0.24 $0.61 $0.71 
Weighted-average common and common-equivalent shares outstanding:
Basic173,943 170,744 172,881 171,053 
Diluted177,138 174,449 176,038 175,164 
Cash dividends per common share$0.055 $0.050 $0.165 $0.150 











 
The accompanying notes are an integral part of these consolidated financial statements.
3


COGNEX CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)
 
 Three-months EndedNine-months Ended
September 27, 2020September 29, 2019September 27, 2020September 29, 2019
 (unaudited)(unaudited)
Net income$87,506 $41,685 $106,841 $123,538 
Other comprehensive income (loss), net of tax:
Available-for-sale investments:
Net unrealized gain (loss), net of tax of $2,855 and ($5) in the three-month periods and net of tax of $1,067 and $502 in the nine-month periods, respectively(2,308)265 6,282 4,827 
Reclassification of credit (recovery) loss on investments into current operations  75  
Reclassification of net realized (gain) loss into current operations(786)(294)(3,591)(716)
Net change related to available-for-sale investments(3,094)(29)2,766 4,111 
Foreign currency translation adjustments:
Foreign currency translation adjustments2,098 (1,099)(3,364)(1,544)
Net change related to foreign currency translation adjustments2,098 (1,099)(3,364)(1,544)
Other comprehensive income (loss), net of tax(996)(1,128)(598)2,567 
Total comprehensive income$86,510 $40,557 $106,243 $126,105 















The accompanying notes are an integral part of these consolidated financial statements.
4


COGNEX CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands)
 
September 27, 2020December 31, 2019
 (unaudited) 
ASSETS
Current assets:
Cash and cash equivalents$298,356 $171,431 
Current investments, amortized cost of $94,761 and $235,610 in 2020 and 2019, respectively, allowance for expected credit losses of $0 in 2020 and 201995,365 240,470 
Accounts receivable, less reserves of $913 and $1,821 in 2020 and 2019, respectively127,755 103,447 
Unbilled revenue15,389 4,782 
Inventories53,860 60,261 
Prepaid expenses and other current assets37,411 26,840 
Total current assets628,136 607,231 
Non-current investments, amortized cost of $613,838 and $431,633 in 2020 and 2019, respectively, allowance for expected credit losses of $75 and $0 in 2020 and 2019, respectively619,343 433,452 
Property, plant, and equipment, net81,225 89,443 
Operating lease assets24,942 17,522 
Goodwill243,129 243,445 
Intangible assets, net16,482 39,490 
Deferred income taxes439,574 449,519 
Other assets7,684 5,833 
Total assets$2,060,515 $1,885,935 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable$21,464 $17,866 
Accrued expenses68,348 52,199 
Accrued income taxes8,006 30,333 
Deferred revenue and customer deposits33,717 14,432 
Operating lease liabilities7,863 5,647 
Total current liabilities139,398 120,477 
Non-current operating lease liabilities20,053 12,326 
Deferred income taxes326,703 332,344 
Reserve for income taxes11,325 11,563 
Non-current accrued income taxes48,915 51,113 
Other liabilities8,292 2,402 
Total liabilities554,686 530,225 
Shareholders’ equity:
Preferred stock, $.01 par value – Authorized: 400 shares in 2020 and 2019, respectively, no shares issued and outstanding  
Common stock, $.002 par value – Authorized: 300,000 shares in 2020 and 2019, respectively, issued and outstanding: 174,633 and 172,440 shares in 2020 and 2019, respectively349 345 
Additional paid-in capital762,832 639,372 
Retained earnings780,521 753,268 
Accumulated other comprehensive loss, net of tax(37,873)(37,275)
Total shareholders’ equity1,505,829 1,355,710 
Total liabilities and shareholders' equity$2,060,515 $1,885,935 

The accompanying notes are an integral part of these consolidated financial statements.
5


COGNEX CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
 Nine-months Ended
September 27, 2020September 29, 2019
 (unaudited)
Cash flows from operating activities:
Net income$106,841 $123,538 
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation expense32,076 33,442 
Depreciation of property, plant, and equipment16,467 15,800 
Amortization of intangible assets3,437 2,119 
Intangible asset impairment charges19,571  
Excess and obsolete inventory charges9,386 4,121 
Operating lease asset impairment charges2,534  
Amortization of discounts or premiums on investments765 (563)
Realized gain on sale of investments(3,591)(716)
Credit loss on investments75  
Revaluation of contingent consideration(114)(1,401)
Change in deferred income taxes3,194 (1,805)
Change in operating assets and liabilities:
Accounts receivable(23,878)11,387 
Unbilled revenue(10,606)(2,900)
Inventories(3,065)13,898 
Prepaid expenses and other current assets(10,718)5,827 
Accounts payable3,587 (3,398)
Accrued expenses17,028 (11,827)
Accrued income taxes(23,627)(1,043)
Deferred revenue and customer deposits19,066 698 
Other1,022 (1,616)
Net cash provided by operating activities159,450 185,561 
Cash flows from investing activities:
Purchases of investments(601,447)(883,363)
Maturities and sales of investments567,245 781,929 
Purchases of property, plant, and equipment(9,829)(13,518)
Net cash provided by (used in) investing activities(44,031)(114,952)
Cash flows from financing activities:
Issuance of common stock under stock plans91,390 31,780 
Repurchase of common stock(51,036)(61,690)
Payment of dividends(28,554)(25,682)
Payment of contingent consideration(1,039) 
Net cash provided by (used in) financing activities10,761 (55,592)
Effect of foreign exchange rate changes on cash and cash equivalents745 (1,528)
Net change in cash and cash equivalents126,925 13,489 
Cash and cash equivalents at beginning of period171,431 108,212 
Cash and cash equivalents at end of period$298,356 $121,701 

The accompanying notes are an integral part of these consolidated financial statements.
6


COGNEX CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(In thousands)
 Common StockAdditional
Paid-in Capital
Retained EarningsAccumulated
Other
Comprehensive
Loss
Total
Shareholders’
Equity
 SharesPar Value
Balance as of June 28, 2020173,047 $346 $710,412 $702,597 $(36,877)$1,376,478 
Issuance of common stock under stock plans1,586 3 43,152 — — 43,155 
Repurchase of common stock  —  —  
Stock-based compensation expense— — 9,268 — — 9,268 
Payment of dividends— — — (9,582)— (9,582)
Net income— — — 87,506 — 87,506 
Net unrealized gain (loss) on available-for-sale investments, net of tax of $2,855— — — — (2,308)(2,308)
Reclassification of credit (recovery) loss on investments — — — —   
Reclassification of net realized (gain) loss on the sale of available-for-sale investments— — — — (786)(786)
Foreign currency translation adjustment— — — — 2,098 2,098 
Balance as of September 27, 2020 (unaudited)174,633 $349 $762,832 $780,521 $(37,873)$1,505,829 
 
 Common StockAdditional
Paid-in Capital
Retained EarningsAccumulated
Other
Comprehensive
Loss
Total
Shareholders’
Equity
 SharesPar Value
Balance as of June 30, 2019170,661 $341 $578,871 $649,234 $(36,806)$1,191,640 
Issuance of common stock under stock plans236 1 5,362 — — 5,363 
Repurchase of common stock  —  —  
Stock-based compensation expense— — 10,194 — — 10,194 
Payment of dividends— — — (8,536)— (8,536)
Net income— — — 41,685 — 41,685 
Net unrealized gain (loss) on available-for-sale investments, net of tax of ($5)— — — — 265 265 
Reclassification of net realized (gain) loss on the sale of available-for-sale investments— — — — (294)(294)
Foreign currency translation adjustment— — — — (1,099)(1,099)
Balance as of September 29, 2019 (unaudited)170,897 $342 $594,427 $682,383 $(37,934)$1,239,218 




The accompanying notes are an integral part of these consolidated financial statements.

7


COGNEX CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(In thousands)
 Common StockAdditional
Paid-in Capital
Retained EarningsAccumulated
Other
Comprehensive
Loss
Total
Shareholders’
Equity
 SharesPar Value
Balance as of December 31, 2019172,440 $345 $639,372 $753,268 $(37,275)$1,355,710 
Issuance of common stock under stock plans3,408 6 91,384 — — 91,390 
Repurchase of common stock(1,215)(2)— (51,034)— (51,036)
Stock-based compensation expense— — 32,076 — — 32,076 
Payment of dividends— — — (28,554)— (28,554)
Net income— — — 106,841 — 106,841 
Net unrealized gain (loss) on available-for-sale investments, net of tax of $1,067— — — — 6,282 6,282 
Reclassification of credit loss on investments— — — — 75 75 
Reclassification of net realized (gain) loss on the sale of available-for-sale investments— — — — (3,591)(3,591)
Foreign currency translation adjustment— — — — (3,364)(3,364)
Balance as of September 27, 2020 (unaudited)174,633 $349 $762,832 $780,521 $(37,873)$1,505,829 

 Common StockAdditional
Paid-in Capital
Retained EarningsAccumulated
Other
Comprehensive
Loss
Total
Shareholders’
Equity
 SharesPar Value
Balance as of December 31, 2018170,820 $342 $529,208 $646,214 $(40,501)$1,135,263 
Issuance of common stock under stock plans1,475 3 31,777 — — 31,780 
Repurchase of common stock(1,398)(3)— (61,687)— (61,690)
Stock-based compensation expense— — 33,442 — — 33,442 
Payment of dividends— — — (25,682)— (25,682)
Net income— — — 123,538 — 123,538 
Net unrealized gain (loss) on available-for-sale investments, net of tax of $502— — — — 4,827 4,827 
Reclassification of net realized (gain) loss on the sale of available-for-sale investments— — — — (716)(716)
Foreign currency translation adjustment— — — — (1,544)(1,544)
Balance as of September 29, 2019 (unaudited)170,897 $342 $594,427 $682,383 $(37,934)$1,239,218 





The accompanying notes are an integral part of these consolidated financial statements.
8


COGNEX CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1: Summary of Significant Accounting Policies
As permitted by the rules of the Securities and Exchange Commission applicable to Quarterly Reports on Form 10-Q, these notes are condensed and do not contain all disclosures required by generally accepted accounting principles (GAAP). As a result of the adoption of ASU 2016-13 "Measurement of Credit Losses on Financial Instruments," Cognex Corporation (the "Company") has provided new disclosures related to credit losses in this Quarterly Report on Form 10-Q. Reference should be made to the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 for a full description of other significant accounting policies.
In the opinion of the management of the Company, the accompanying consolidated unaudited financial statements contain all adjustments, consisting of normal, recurring adjustments, excess and obsolete inventory charges (Note 5), intangible asset impairment charges (Note 8), restructuring charges (Note 16), and financial statement reclassifications necessary to present fairly the Company’s financial position as of September 27, 2020, and the results of its operations for the three-month and nine-month periods ended September 27, 2020 and September 29, 2019, and changes in shareholders’ equity, comprehensive income, and cash flows for the periods presented.
The results disclosed in the Consolidated Statements of Operations for the three-month and nine-month periods ended September 27, 2020 are not necessarily indicative of the results to be expected for the full year.
Cash, Cash Equivalents, and Investments
Money market instruments, as well as certificates of deposit and debt securities with original maturities of three months or less, are classified as cash equivalents and are stated at amortized cost. Certificates of deposit and debt securities with original maturities greater than three months and remaining maturities of one year or less are classified as current investments. Debt securities with remaining maturities greater than one year are classified as non-current investments. It is the Company’s policy to invest in debt securities with effective maturities that do not exceed ten years.
Debt securities with original maturities greater than three months are designated as available-for-sale and are reported at fair value, with unrealized gains and losses, net of tax and credit losses, recorded in shareholders’ equity as other comprehensive income (loss). Realized gains and losses are included in current operations, along with the amortization of the discount or premium on debt securities arising at acquisition, and are calculated using the specific identification method. The Company’s limited partnership interest is accounted for using the cost method because the Company’s investment is less than 5% of the partnership and the Company has no influence over the partnership’s operating and financial policies. The carrying value of this investment has been reduced to zero, and therefore, distributions are recorded as investment income as they occur.
Management monitors the carrying value of its investments in debt securities compared to their fair value to determine whether a credit loss or other type of impairment has occurred. If the fair value of a debt security is less than its amortized cost, the Company assesses whether the decline has resulted from a credit loss or other factors. In assessing whether a credit loss exists, the Company compares the present value of the cash flows expected to be collected from the security with the amortized cost basis of the security. If the present value of the cash flows expected to be collected is less than the amortized cost basis of the security, then a credit loss exists and an allowance for credit losses is recorded. The allowance for credit losses is limited by the amount that the fair value is less than the amortized cost basis of the security. Credit losses on impaired securities continue to be measured in subsequent periods, using the present value of expected future cash flows, and changes in the expected credit losses are recorded in current operations. Credit losses and recoveries are included in "Other income (expense)" on the Consolidated Statement of Operations. When developing an estimate of the expected credit losses, the Company considers all available information relevant to assessing the collectability of cash flows. This information includes internal and external factors, historical and current events, reasonable and supportable forecasts including management's expectations of future economic conditions, the type of security, the credit rating of the security, and the size of the loss position, as well as other relevant information.


9


An impairment is recognized as a write-down if (i) the Company has the intent to sell the security or (ii) it is more likely than not that the Company will be required to sell the security before recovery of the entire amortized cost basis. If impairment is considered upon condition (i) or (ii) described above, the debt security's amortized cost basis is written-down to its fair value and the impairment is recognized in current operations. Subsequent increases in the fair value of the debt securities after the write-down are included in shareholders' equity as other comprehensive income. The differences between the new amortized cost basis and the cash flows expected to be collected are accreted as interest income.