falsedesktopFTNT2020-09-30000126203920000067{"tbl_sim": "https://q10k.com/tbl-sim", "search": "https://q10k.com/search"}{"q10k_tbl_0": "Large accelerated filer\t☒\t\tAccelerated filer\t☐\nNon-accelerated filer\t☐\t\tSmaller reporting company\t☐\n\tEmerging growth company\t☐\n", "q10k_tbl_1": "\t\tPage\n\tPART I-FINANCIAL INFORMATION\t\nItem 1.\tFinancial Statements (unaudited)\t1\n\tCondensed Consolidated Balance Sheets as of September 30 2020 and December 31 2019\t1\n\tCondensed Consolidated Statements of Income for the Three and Nine Months Ended September 30 2020 and 2019\t2\n\tCondensed Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30 2020 and 2019\t3\n\tCondensed Consolidated Statements of Stockholders' Equity for the Three and Nine Months Ended September 30 2020 and 2019\t4\n\tCondensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30 2020 and 2019\t6\n\tNotes to Condensed Consolidated Financial Statements\t7\nItem 2.\tManagement's Discussion and Analysis of Financial Condition and Results of Operations\t27\nItem 3.\tQuantitative and Qualitative Disclosures about Market Risk\t43\nItem 4.\tControls and Procedures\t43\n\tPART II-OTHER INFORMATION\t\nItem 1.\tLegal Proceedings\t44\nItem 1A.\tRisk Factors\t44\nItem 2.\tUnregistered Sales of Equity Securities and Use of Proceeds\t74\nItem 5.\tOther Information\t74\nItem 6.\tExhibits\t82\n\tExhibit Index\t82\n\tSignatures\t83\n", "q10k_tbl_2": "\tSeptember 30 2020\tDecember 31 2019\nASSETS\t\t\nCURRENT ASSETS:\t\t\nCash and cash equivalents\t882.3\t1222.5\nShort-term investments\t774.4\t843.1\nAccounts receivable-net\t546.6\t544.3\nInventory\t134.5\t117.9\nPrepaid expenses and other current assets\t46.8\t41.2\nTotal current assets\t2384.6\t2769.0\nLONG-TERM INVESTMENTS\t117.9\t144.3\nPROPERTY AND EQUIPMENT-NET\t419.4\t344.3\nDEFERRED CONTRACT COSTS\t281.1\t237.0\nDEFERRED TAX ASSETS\t230.1\t226.3\nGOODWILL\t68.2\t67.2\nOTHER INTANGIBLE ASSETS-NET\t25.3\t31.1\nOTHER ASSETS\t59.6\t60.0\nTOTAL ASSETS\t3586.2\t3879.2\nLIABILITIES AND STOCKHOLDERS' EQUITY\t\t\nCURRENT LIABILITIES:\t\t\nAccounts payable\t95.9\t96.4\nAccrued liabilities\t127.8\t101.8\nAccrued payroll and compensation\t121.9\t101.8\nDeferred revenue\t1300.0\t1155.8\nTotal current liabilities\t1645.6\t1455.8\nDEFERRED REVENUE\t1092.0\t953.3\nINCOME TAX LIABILITIES\t79.3\t82.8\nOTHER LIABILITIES\t56.1\t44.9\nTotal liabilities\t2873.0\t2536.8\nCOMMITMENTS AND CONTINGENCIES (Note 13)\t\t\nSTOCKHOLDERS' EQUITY:\t\t\nCommon stock $0.001 par value-300 shares authorized; 162.3 and 171.7 shares issued and outstanding at September 30 2020 and December 31 2019 respectively\t0.2\t0.2\nAdditional paid-in capital\t1178.5\t1180.3\nAccumulated other comprehensive income\t1.4\t1.1\nRetained earnings (accumulated deficit)\t(466.9)\t160.8\nTotal stockholders' equity\t713.2\t1342.4\nTOTAL LIABILITIES AND STOCKHOLDERS' EQUITY\t3586.2\t3879.2\n", "q10k_tbl_3": "\tThree Months Ended\t\t\t\tNine Months Ended\t\t\nSeptember 30 2020\t\tSeptember 30 2019\t\tSeptember 30 2020\t\tSeptember 30 2019\nREVENUE:\t\t\t\t\t\t\t\nProduct\t223.8\t\t197.1\t\t628.0\t\t549.7\nService\t427.3\t\t351.0\t\t1218.4\t\t995.2\nTotal revenue\t651.1\t\t548.1\t\t1846.4\t\t1544.9\nCOST OF REVENUE:\t\t\t\t\t\t\t\nProduct\t84.3\t\t79.0\t\t245.0\t\t231.9\nService\t54.9\t\t45.1\t\t158.0\t\t133.5\nTotal cost of revenue\t139.2\t\t124.1\t\t403.0\t\t365.4\nGROSS PROFIT:\t\t\t\t\t\t\t\nProduct\t139.5\t\t118.1\t\t383.0\t\t317.8\nService\t372.4\t\t305.9\t\t1060.4\t\t861.7\nTotal gross profit\t511.9\t\t424.0\t\t1443.4\t\t1179.5\nOPERATING EXPENSES:\t\t\t\t\t\t\t\nResearch and development\t90.0\t\t69.9\t\t252.4\t\t205.9\nSales and marketing\t266.7\t\t227.4\t\t780.5\t\t669.8\nGeneral and administrative\t29.4\t\t26.1\t\t87.1\t\t74.9\nGain on intellectual property matter\t(1.1)\t\t0\t\t(39.0)\t\t0\nTotal operating expenses\t385.0\t\t323.4\t\t1081.0\t\t950.6\nOPERATING INCOME\t126.9\t\t100.6\t\t362.4\t\t228.9\nINTEREST INCOME-NET\t2.5\t\t11.4\t\t15.7\t\t32.6\nOTHER EXPENSE-NET\t(1.0)\t\t(6.0)\t\t(8.1)\t\t(6.9)\nINCOME BEFORE INCOME TAXES\t128.4\t\t106.0\t\t370.0\t\t254.6\nPROVISION FOR INCOME TAXES\t5.0\t\t25.8\t\t28.2\t\t41.1\nNET INCOME\t123.4\t\t80.2\t\t341.8\t\t213.5\nNet income per share (Note 10):\t\t\t\t\t\t\t\nBasic\t0.76\t\t0.47\t\t2.07\t\t1.25\nDiluted\t0.75\t\t0.46\t\t2.03\t\t1.22\nWeighted-average shares outstanding:\t\t\t\t\t\t\t\nBasic\t162.1\t\t171.3\t\t164.8\t\t170.9\nDiluted\t165.6\t\t174.8\t\t168.4\t\t174.9\n", "q10k_tbl_4": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nNet income\t123.4\t80.2\t341.8\t213.5\nOther comprehensive income (loss):\t\t\t\t\nChange in unrealized gains (losses) on investments\t(1.4)\t0.2\t0.7\t2.7\nLess: tax provision (benefit) related to change in unrealized gains (losses) on investments\t(0.3)\t0\t0.4\t0.7\nOther comprehensive income (loss)\t(1.1)\t0.2\t0.3\t2.0\nComprehensive income\t122.3\t80.4\t342.1\t215.5\n", "q10k_tbl_5": "\tThree Months Ended September 30 2020\t\t\t\t\t\t\n\tCommon Stock\t\t\tAdditional Paid-In Capital\tAccumulated Other Comprehensive Income\tAccumulated Deficit\tTotal Stockholders' Equity\nShares\t\tAmount\t\nBALANCE-June 30 2020\t161.8\t\t0.2\t1154.3\t2.5\t(590.3)\t566.7\nIssuance of common stock in connection with equity incentive plans - net of tax withholding\t0.5\t\t0\t(25.1)\t0\t0\t(25.1)\nStock-based compensation expense\t0\t\t0\t49.3\t0\t0\t49.3\nNet unrealized loss on investments - net of tax\t0\t\t0\t0\t(1.1)\t0\t(1.1)\nNet income\t0\t\t0\t0\t0\t123.4\t123.4\nBALANCE-September 30 2020\t162.3\t\t0.2\t1178.5\t1.4\t(466.9)\t713.2\n\tThree Months Ended September 30 2019\t\t\t\t\t\t\n\tCommon Stock\t\t\tAdditional Paid-In Capital\tAccumulated Other Comprehensive Income\tRetained Earnings (Accumulated Deficit)\tTotal Stockholders' Equity\nShares\t\tAmount\t\nBALANCE-June 30 2019\t171.0\t\t0.2\t1130.2\t0.9\t8.1\t1139.4\nIssuance of common stock in connection with equity incentive plans - net of tax withholding\t0.6\t\t0\t(17.8)\t0\t0\t(17.8)\nRepurchase and retirement of common stock\t(0.3)\t\t0\t(2.2)\t0\t(24.3)\t(26.5)\nStock-based compensation expense\t0\t\t0\t42.4\t0\t0\t42.4\nNet unrealized gain on investments - net of tax\t0\t\t0\t0\t0.2\t0\t0.2\nNet income\t0\t\t0\t0\t0\t80.2\t80.2\nBALANCE-September 30 2019\t171.3\t\t0.2\t1152.6\t1.1\t64.0\t1217.9\n", "q10k_tbl_6": "\tNine Months Ended September 30 2020\t\t\t\t\t\t\n\tCommon Stock\t\t\tAdditional Paid-In Capital\tAccumulated Other Comprehensive Income\tRetained Earnings (Accumulated Deficit)\tTotal Stockholders' Equity\nShares\t\tAmount\t\nBALANCE-December 31 2019\t171.7\t\t0.2\t1180.3\t1.1\t160.8\t1342.4\nIssuance of common stock in connection with equity incentive plans - net of tax withholding\t2.0\t\t0\t(68.3)\t0\t0\t(68.3)\nRepurchase and retirement of common stock\t(11.4)\t\t0\t(76.5)\t0\t(969.5)\t(1046.0)\nStock-based compensation expense\t0\t\t0\t143.0\t0\t0\t143.0\nNet unrealized gain on investments - net of tax\t0\t\t0\t0\t0.3\t0\t0.3\nNet income\t0\t\t0\t0\t0\t341.8\t341.8\nBALANCE-September 30 2020\t162.3\t\t0.2\t1178.5\t1.4\t(466.9)\t713.2\n\tNine Months Ended September 30 2019\t\t\t\t\t\t\n\tCommon Stock\t\t\tAdditional Paid-In Capital\tAccumulated Other Comprehensive Income (Loss)\tRetained Earnings (Accumulated Deficit)\tTotal Stockholders' Equity\nShares\t\tAmount\t\nBALANCE-December 31 2018\t169.8\t\t0.2\t1068.3\t(0.8)\t(42.2)\t1025.5\nIssuance of common stock in connection with equity incentive plans - net of tax withholding\t3.1\t\t0\t(36.1)\t0\t0\t(36.1)\nRepurchase and retirement of common stock\t(1.6)\t\t0\t(10.0)\t0\t(107.4)\t(117.4)\nStock-based compensation expense\t0\t\t0\t130.4\t0\t0\t130.4\nCumulative-effect adjustment from adoption of ASU 2018-02\t\t\t\t\t(0.1)\t0.1\t0\nNet unrealized gain on investments - net of tax\t0\t\t0\t0\t2.0\t0\t2.0\nNet income\t0\t\t0\t0\t0\t213.5\t213.5\nBALANCE-September 30 2019\t171.3\t\t0.2\t1152.6\t1.1\t64.0\t1217.9\n", "q10k_tbl_7": "\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\nCASH FLOWS FROM OPERATING ACTIVITIES:\t\t\nNet income\t341.8\t213.5\nAdjustments to reconcile net income to net cash provided by operating activities:\t\t\nStock-based compensation\t143.0\t130.4\nAmortization of deferred contract costs\t99.8\t78.5\nDepreciation and amortization\t52.1\t45.9\nAmortization of investment premiums (discounts)\t0.2\t(4.7)\nOther\t5.8\t5.0\nChanges in operating assets and liabilities:\t\t\nAccounts receivable-net\t(3.1)\t60.5\nInventory\t(31.0)\t(25.2)\nPrepaid expenses and other current assets\t(4.6)\t(6.3)\nDeferred contract costs\t(143.9)\t(113.1)\nDeferred tax assets\t4.4\t11.5\nOther assets\t(2.0)\t(0.8)\nAccounts payable\t(4.2)\t(6.2)\nAccrued liabilities\t16.5\t(16.6)\nAccrued payroll and compensation\t19.5\t(9.5)\nOther liabilities\t10.3\t(1.0)\nDeferred revenue\t282.6\t255.7\nNet cash provided by operating activities\t787.2\t617.6\nCASH FLOWS FROM INVESTING ACTIVITIES:\t\t\nPurchases of investments\t(776.3)\t(1072.4)\nSales of investments\t141.4\t19.7\nMaturities of investments\t730.3\t695.0\nPurchases of property and equipment\t(93.6)\t(45.0)\nPayments made in connection with business combination net of cash acquired\t(9.2)\t0\nOther\t(0.4)\t0\nNet cash used in investing activities\t(7.8)\t(402.7)\nCASH FLOWS FROM FINANCING ACTIVITIES:\t\t\nRepurchase and retirement of common stock\t(1046.0)\t(117.6)\nProceeds from issuance of common stock\t18.2\t41.8\nTaxes paid related to net share settlement of equity awards\t(86.5)\t(76.0)\nPayments of debt assumed in connection with business combination\t(4.1)\t0\nOther\t(1.2)\t0\nNet cash used in financing activities\t(1119.6)\t(151.8)\nNET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS\t(340.2)\t63.1\nCASH AND CASH EQUIVALENTS-Beginning of period\t1222.5\t1112.4\nCASH AND CASH EQUIVALENTS-End of period\t882.3\t1175.5\nSUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:\t\t\nOperating lease liabilities arising from obtaining right-of-use assets\t14.7\t12.6\nCash paid to settle liability incurred for repurchase of common stock\t0\t4.2\nNON-CASH INVESTING AND FINANCING ACTIVITIES:\t\t\nTransfers of evaluation units from inventory to property and equipment\t14.8\t16.3\nLiability for purchase of property and equipment\t26.1\t20.1\nLiability incurred for repurchase of common stock\t0\t4.0\n", "q10k_tbl_8": "\tDecember 31 2019\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nASSETS\t\t\t\nDEFERRED TAX ASSETS\t232.6\t(6.3)\t226.3\nTOTAL ASSETS\t3885.5\t(6.3)\t3879.2\nLIABILITIES AND STOCKHOLDERS' EQUITY\t\t\t\nCURRENT LIABILITIES:\t\t\t\nDeferred revenue\t1173.6\t(17.8)\t1155.8\nTotal current liabilities\t1473.6\t(17.8)\t1455.8\nDEFERRED REVENUE\t962.3\t(9.0)\t953.3\nTotal liabilities\t2563.6\t(26.8)\t2536.8\nSTOCKHOLDERS' EQUITY:\t\t\t\nRetained earnings (accumulated deficit)\t140.3\t20.5\t160.8\nTotal stockholders' equity\t1321.9\t20.5\t1342.4\nTOTAL LIABILITIES AND STOCKHOLDERS' EQUITY\t3885.5\t(6.3)\t3879.2\n", "q10k_tbl_9": "\tThree Months Ended September 30 2019\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t350.4\t0.6\t351.0\nTotal revenue\t547.5\t0.6\t548.1\nGROSS PROFIT:\t\t\t\nService\t305.3\t0.6\t305.9\nTotal gross profit\t423.4\t0.6\t424.0\nOPERATING INCOME\t100.0\t0.6\t100.6\nINCOME BEFORE INCOME TAXES\t105.4\t0.6\t106.0\nPROVISION FOR INCOME TAXES\t25.6\t0.2\t25.8\nNET INCOME\t79.8\t0.4\t80.2\nNet income per share (Note 10):\t\t\t\nBasic\t0.47\t0\t0.47\nDiluted\t0.46\t0\t0.46\n", "q10k_tbl_10": "\tNine Months Ended September 30 2019\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t992.1\t3.1\t995.2\nTotal revenue\t1541.8\t3.1\t1544.9\nGROSS PROFIT:\t\t\t\nService\t858.6\t3.1\t861.7\nTotal gross profit\t1176.4\t3.1\t1179.5\nOPERATING INCOME\t225.8\t3.1\t228.9\nINCOME BEFORE INCOME TAXES\t251.5\t3.1\t254.6\nPROVISION FOR INCOME TAXES\t40.2\t0.9\t41.1\nNET INCOME\t211.3\t2.2\t213.5\nNet income per share (Note 10):\t\t\t\nBasic\t1.24\t0.01\t1.25\nDiluted\t1.21\t0.01\t1.22\n", "q10k_tbl_11": "\tNine Months Ended September 30 2019\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nCASH FLOWS FROM OPERATING ACTIVITIES:\t\t\t\nNet income\t211.3\t2.2\t213.5\nChanges in operating assets and liabilities:\t\t\t\nDeferred tax assets\t10.6\t0.9\t11.5\nDeferred revenue\t258.8\t(3.1)\t255.7\nNet cash provided by operating activities\t617.6\t0\t617.6\n", "q10k_tbl_12": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nProduct\t223.8\t197.1\t628.0\t549.7\nService:\t\t\t\t\nSecurity subscription\t235.4\t192.8\t669.4\t545.5\nTechnical support and other\t191.9\t158.2\t549.0\t449.7\nTotal service revenue\t427.3\t351.0\t1218.4\t995.2\nTotal revenue\t651.1\t548.1\t1846.4\t1544.9\n", "q10k_tbl_13": "\tSeptember 30 2020\t\t\t\n\tAmortized Cost\tUnrealized Gains\tUnrealized Losses\tFair Value\nCorporate debt securities\t501.1\t1.8\t(0.1)\t502.8\nU.S. government securities\t166.3\t0.1\t0\t166.4\nCommercial paper\t125.2\t0.1\t0\t125.3\nCertificates of deposit and term deposits (1)\t97.8\t0\t0\t97.8\nTotal available-for-sale securities\t890.4\t2.0\t(0.1)\t892.3\n", "q10k_tbl_14": "\tDecember 31 2019\t\t\t\n\tAmortized Cost\tUnrealized Gains\tUnrealized Losses\tFair Value\nCorporate debt securities\t576.1\t1.0\t(0.1)\t577.0\nU.S. government securities\t195.0\t0.2\t0\t195.2\nCommercial paper\t148.7\t0.1\t0\t148.8\nCertificates of deposit and term deposits (1)\t66.4\t0\t0\t66.4\nTotal available-for-sale securities\t986.2\t1.3\t(0.1)\t987.4\n(1) The majority of our certificates of deposit and term deposits are foreign deposits.\t\t\t\t\n", "q10k_tbl_15": "\tSeptember 30 2020\t\t\t\t\t\n\tLess Than 12 Months\t\t12 Months or Greater\t\tTotal\t\n\tFair Value\tUnrealized Losses\tFair Value\tUnrealized Losses\tFair Value\tUnrealized Losses\nCorporate debt securities\t103.9\t0\t0\t0\t103.9\t0\nU.S. government securities\t42.1\t0\t0\t0\t42.1\t0\nCommercial paper\t24.6\t0\t0\t0\t24.6\t0\nCertificates of deposit and term deposits\t17.3\t(0.1)\t0\t0\t17.3\t(0.1)\nTotal available-for-sale securities\t187.9\t(0.1)\t0\t0\t187.9\t(0.1)\n", "q10k_tbl_16": "\tDecember 31 2019\t\t\t\t\t\n\tLess Than 12 Months\t\t12 Months or Greater\t\tTotal\t\n\tFair Value\tUnrealized Losses\tFair Value\tUnrealized Losses\tFair Value\tUnrealized Losses\nCorporate debt securities\t117.3\t(0.1)\t16.1\t0\t133.4\t(0.1)\nU.S. government securities\t47.1\t0\t0\t0\t47.1\t0\nCommercial paper\t26.0\t0\t0\t0\t26.0\t0\nCertificates of deposit and term deposits\t13.0\t0\t0\t0\t13.0\t0\nTotal available-for-sale securities\t203.4\t(0.1)\t16.1\t0\t219.5\t(0.1)\n", "q10k_tbl_17": "\tSeptember 30 2020\tDecember 31 2019\nDue within one year\t774.4\t843.1\nDue within one to three years\t117.9\t144.3\nTotal\t892.3\t987.4\n", "q10k_tbl_18": "\tSeptember 30 2020\t\t\t\tDecember 31 2019\t\t\t\n\tAggregate Fair Value\tQuoted Prices in Active Markets For Identical Assets\tSignificant Other Observable Remaining Inputs\tSignificant Other Unobservable Remaining Inputs\tAggregate Fair Value\tQuoted Prices in Active Markets For Identical Assets\tSignificant Other Observable Remaining Inputs\tSignificant Other Unobservable Remaining Inputs\n\t\t(Level 1)\t(Level 2)\t(Level 3)\t\t(Level 1)\t(Level 2)\t(Level 3)\nAssets:\t\t\t\t\t\t\t\t\nCorporate debt securities\t505.9\t0\t505.9\t0\t577.0\t0\t577.0\t0\nU.S. government securities\t166.4\t166.4\t0\t0\t195.2\t195.2\t0\t0\nCommercial paper\t125.3\t0\t125.3\t0\t165.8\t0\t165.8\t0\nCertificates of deposit and term deposits\t97.8\t0\t97.8\t0\t66.4\t0\t66.4\t0\nMoney market funds\t164.0\t164.0\t0\t0\t15.0\t15.0\t0\t0\nTotal\t1059.4\t330.4\t729.0\t0\t1019.4\t210.2\t809.2\t0\nReported as:\t\t\t\t\t\t\t\t\nCash equivalents\t167.1\t\t\t\t32.0\t\t\t\nShort-term investments\t774.4\t\t\t\t843.1\t\t\t\nLong-term investments\t117.9\t\t\t\t144.3\t\t\t\nTotal\t1059.4\t\t\t\t1019.4\t\t\t\n", "q10k_tbl_19": "\tSeptember 30 2020\tDecember 31 2019\nRaw materials\t15.6\t9.7\nFinished goods\t118.9\t108.2\nInventory\t134.5\t117.9\n", "q10k_tbl_20": "\tSeptember 30 2020\tDecember 31 2019\nLand\t93.3\t93.3\nBuilding and building improvements\t148.1\t147.4\nComputer equipment and software\t131.5\t116.7\nLeasehold improvements\t30.3\t25.5\nEvaluation units\t18.8\t19.9\nFurniture and fixtures\t20.0\t17.3\nConstruction-in-progress\t140.8\t61.2\nTotal property and equipment\t582.8\t481.3\nLess: accumulated depreciation\t(163.4)\t(137.0)\nProperty and equipment-net\t419.4\t344.3\n", "q10k_tbl_21": "\tSeptember 30 2020\t\t\t\n\tWeighted-Average Useful Life (in Years)\tGross\tAccumulated Amortization\tNet\nOther intangible assets-net:\t\t\t\t\nFinite-lived intangible assets:\t\t\t\t\nDeveloped technologies\t4.0\t53.3\t30.2\t23.1\nCustomer relationships\t4.1\t21.8\t19.6\t2.2\nTotal other intangible assets-net\t\t75.1\t49.8\t25.3\n", "q10k_tbl_22": "\tDecember 31 2019\t\t\t\n\tWeighted-Average Useful Life (in Years)\tGross\tAccumulated Amortization\tNet\nOther intangible assets-net:\t\t\t\t\nFinite-lived intangible assets:\t\t\t\t\nDeveloped technologies\t4.0\t50.2\t24.6\t25.6\nCustomer relationships\t4.1\t21.6\t16.1\t5.5\nTotal other intangible assets-net\t\t71.8\t40.7\t31.1\n", "q10k_tbl_23": "\tAmount\nYears:\t\n2020 (the remainder of 2020)\t2.7\n2021\t9.6\n2022\t7.5\n2023\t4.8\n2024\t0.7\nTotal\t25.3\n", "q10k_tbl_24": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nNumerator:\t\t\t\t\nNet income\t123.4\t80.2\t341.8\t213.5\nDenominator:\t\t\t\t\nBasic shares:\t\t\t\t\nWeighted-average common stock outstanding-basic\t162.1\t171.3\t164.8\t170.9\nDiluted shares:\t\t\t\t\nWeighted-average common stock outstanding-basic\t162.1\t171.3\t164.8\t170.9\nEffect of potentially dilutive securities:\t\t\t\t\nRSUs\t2.3\t2.4\t2.4\t2.9\nStock options\t1.2\t1.1\t1.2\t1.1\nWeighted-average shares used to compute diluted net income per share\t165.6\t174.8\t168.4\t174.9\nNet income per share:\t\t\t\t\nBasic\t0.76\t0.47\t2.07\t1.25\nDiluted\t0.75\t0.46\t2.03\t1.22\n", "q10k_tbl_25": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nRSUs\t0.3\t0.2\t0.3\t0.3\nStock options\t0.6\t0.7\t0.5\t0.6\nTotal\t0.9\t0.9\t0.8\t0.9\n", "q10k_tbl_26": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nOperating lease expense\t4.8\t3.8\t13.5\t11.1\nVariable lease expense (1)\t0.7\t0.7\t1.7\t1.9\nShort-term lease expense\t1.0\t0.8\t2.9\t2.2\nTotal lease expense\t6.5\t5.3\t18.1\t15.2\n", "q10k_tbl_27": "\tClassification\tSeptember 30 2020\tDecember 31 2019\nOperating lease ROU assets - non-current\tOther assets\t45.6\t44.3\nOperating lease liabilities - current\tAccrued liabilities\t17.2\t15.5\nOperating lease liabilities - non-current\tOther liabilities\t31.0\t30.6\nTotal operating lease liabilities\t\t48.2\t46.1\nWeighted average remaining lease term in years - operating leases\t\t3.6\t3.7\nWeighted average discount rate - operating leases\t\t3.2%\t2.8%\n", "q10k_tbl_28": "Year ending December 31\tAmount\n2020 (the remainder of 2020)\t4.2\n2021\t17.8\n2022\t12.6\n2023\t7.2\n2024\t5.3\nThereafter\t4.0\nTotal lease payments\t51.1\nLess imputed interest\t(2.9)\nTotal\t48.2\n", "q10k_tbl_29": "\tTotal\t2020\t2021\t2022\t2023\t2024\tThereafter\nInventory purchase commitments\t284.7\t207.6\t77.1\t0\t0\t0\t0\n", "q10k_tbl_30": "\tRestricted Stock Units Outstanding\t\n\tNumber of Shares\tWeighted-Average Grant Date Fair Value per Share\nBalance-December 31 2019\t6.1\t64.56\nGranted\t1.8\t121.30\nForfeited\t(0.3)\t76.80\nVested\t(2.3)\t57.07\nBalance-September 30 2020\t5.3\t86.31\n", "q10k_tbl_31": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nShares withheld for taxes\t0.2\t0.2\t0.7\t0.9\nAmount withheld for taxes\t27.6\t19.6\t86.5\t76.1\n", "q10k_tbl_32": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nExpected term in years\t4.4\t4.4\t4.4\t4.4\nVolatility\t39.9%\t35.3%\t34.6%\t34.2%\nRisk-free interest rate\t0.2%\t1.4%\t1.1%\t2.4%\nDividend rate\t-%\t-%\t-%\t-%\n", "q10k_tbl_33": "\tOptions Outstanding\t\t\t\n\tNumber of Shares\tWeighted- Average Exercise Price\tWeighted- Average Remaining Contractual Life (Years)\tAggregate Intrinsic Value\nBalance-December 31 2019\t2.7\t50.37\t\t\nGranted\t0.6\t118.96\t\t\nForfeited\t(0.1)\t91.73\t\t\nExercised\t(0.4)\t40.99\t\t\nBalance-September 30 2020\t2.8\t66.72\t\t\nOptions vested and expected to vest-September 30 2020\t2.8\t66.72\t4.4\t146.4\nOptions exercisable-September 30 2020\t1.5\t42.81\t3.3\t109.6\n", "q10k_tbl_34": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nWeighted-average fair value per share granted\t43.80\t24.97\t35.76\t26.96\nIntrinsic value of options exercised\t5.5\t3.2\t35.8\t40.1\nFair value of options vested\t2.5\t2.0\t10.9\t8.2\n", "q10k_tbl_35": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nCost of product revenue\t0.4\t0.4\t1.2\t1.2\nCost of service revenue\t3.3\t2.7\t9.5\t8.4\nResearch and development\t12.7\t9.3\t35.6\t28.7\nSales and marketing\t27.7\t24.9\t81.3\t76.6\nGeneral and administrative\t5.9\t5.1\t17.3\t15.5\nTotal stock-based compensation expense\t50.0\t42.4\t144.9\t130.4\n", "q10k_tbl_36": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nRSUs\t46.4\t39.5\t134.5\t120.6\nStock options\t3.6\t2.9\t10.4\t8.5\nESPP\t0\t0\t0\t1.3\nTotal stock-based compensation expense\t50.0\t42.4\t144.9\t130.4\n", "q10k_tbl_37": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nIncome tax benefit associated with stock-based compensation\t11.0\t9.8\t31.9\t30.1\n", "q10k_tbl_38": "\tThree Months Ended\t\tNine Months Ended\t\nRevenue\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nAmericas:\t\t\t\t\nUnited States\t206.0\t182.3\t589.1\t506.9\nOther Americas\t66.4\t58.7\t186.9\t161.1\nTotal Americas\t272.4\t241.0\t776.0\t668.0\nEurope Middle East and Africa (\"EMEA\")\t243.3\t200.9\t693.5\t571.1\nAsia Pacific (\"APAC\")\t135.4\t106.2\t376.9\t305.8\nTotal revenue\t651.1\t548.1\t1846.4\t1544.9\n", "q10k_tbl_39": "Property and Equipment-net\tSeptember 30 2020\tDecember 31 2019\nAmericas:\t\t\nUnited States\t270.9\t197.4\nCanada\t121.3\t120.5\nLatin America\t6.9\t5.5\nTotal Americas\t399.1\t323.4\nEMEA\t15.3\t15.2\nAPAC\t5.0\t5.7\nTotal property and equipment-net\t419.4\t344.3\n", "q10k_tbl_40": "\tThree Months Ended\t\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\tSeptember 30 2020\tSeptember 30 2019\nExclusive Networks Group (\"Exclusive\")\t29%\t30%\t30%\t31%\nIngram Micro Inc. (\"Ingram Micro\")\t10%\t11%\t10%\t11%\n", "q10k_tbl_41": "\tSeptember 30 2020\tDecember 31 2019\nExclusive\t31%\t36%\nIngram Micro\t11%\t10%\nTech Data Corporation\t10%\t*\n* Represents less than 10%\t\t\n", "q10k_tbl_42": "\tThree Months Ended Or As Of\t\n\tSeptember 30 2020\tSeptember 30 2019\n\t(in millions)\t\nRevenue\t651.1\t548.1\nDeferred revenue\t2392.0\t1922.5\nBillings (non-GAAP)\t749.8\t626.6\nNet cash provided by operating activities\t220.8\t221.2\nFree cash flow (non-GAAP)\t185.7\t203.7\n", "q10k_tbl_43": "\tThree Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\n\t(in millions)\t\nBillings:\t\t\nRevenue\t651.1\t548.1\nAdd: Change in deferred revenue\t98.9\t78.5\nLess: Deferred revenue balance acquired in business combination\t(0.2)\t0\nTotal billings (non-GAAP)\t749.8\t626.6\n", "q10k_tbl_44": "\tThree Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\n\t(in millions)\t\nFree Cash Flow:\t\t\nNet cash provided by operating activities\t220.8\t221.2\nLess: Purchases of property and equipment\t(35.1)\t(17.5)\nFree cash flow (non-GAAP)\t185.7\t203.7\nNet cash used in investing activities\t(224.6)\t(27.1)\nNet cash used in financing activities\t(30.3)\t(40.7)\n", "q10k_tbl_45": "\tThree Months Ended\t\t\t\t\t\t\t\t\t\t\nSeptember 30 2020\t\t\t\tSeptember 30 2019\t\t\t\t\t\t\nAmount\t\t% of Revenue\t\tAmount\t\t% of Revenue\t\tChange\t\t% Change\n(in millions except percentages)\t\t\t\t\t\t\t\t\t\t\nRevenue:\t\t\t\t\t\t\t\t\t\t\t\nProduct\t223.8\t\t34%\t\t197.1\t\t36%\t\t26.7\t\t14%\nService\t427.3\t\t66\t\t351.0\t\t64\t\t76.3\t\t22\nTotal revenue\t651.1\t\t100%\t\t548.1\t\t100%\t\t103.0\t\t19%\nRevenue by geography:\t\t\t\t\t\t\t\t\t\t\t\nAmericas\t272.4\t\t42%\t\t241.0\t\t44%\t\t31.4\t\t13%\nEMEA\t243.3\t\t37\t\t200.9\t\t37\t\t42.4\t\t21\nAPAC\t135.4\t\t21\t\t106.2\t\t19\t\t29.2\t\t27\nTotal revenue\t651.1\t\t100%\t\t548.1\t\t100%\t\t103.0\t\t19%\n", "q10k_tbl_46": "\tThree Months Ended\t\t\t\t\t\t\nSeptember 30 2020\t\tSeptember 30 2019\t\tChange\t\t% Change\n(in millions except percentages)\t\t\t\t\t\t\nCost of revenue:\t\t\t\t\t\t\t\nProduct\t84.3\t\t79.0\t\t5.3\t\t7%\nService\t54.9\t\t45.1\t\t9.8\t\t22\nTotal cost of revenue\t139.2\t\t124.1\t\t15.1\t\t12%\nGross margin (%):\t\t\t\t\t\t\t\nProduct\t62.3%\t\t59.9%\t\t\t\t\nService\t87.2\t\t87.2\t\t\t\t\nTotal gross margin\t78.6%\t\t77.4%\t\t\t\t\n", "q10k_tbl_47": "\tThree Months Ended\t\t\t\t\t\t\tChange\t% Change\nSeptember 30 2020\t\t\t\tSeptember 30 2019\t\t\t\nAmount\t\t% of Revenue\t\tAmount\t\t% of Revenue\t\n(in millions except percentages)\t\t\t\t\t\t\t\t\nOperating expenses:\t\t\t\t\t\t\t\t\t\nResearch and development\t90.0\t\t14%\t\t69.9\t\t13%\t20.1\t29%\nSales and marketing\t266.7\t\t41\t\t227.4\t\t41\t39.3\t17\nGeneral and administrative\t29.4\t\t5\t\t26.1\t\t5\t3.3\t13\nGain on IP matter\t(1.1)\t\t0\t\t0\t\t0\t(1.1)\t*\nTotal operating expenses\t385.0\t\t59%\t\t323.4\t\t59%\t61.6\t19%\n", "q10k_tbl_48": "\tThree Months Ended\t\t\t\t\t\t\nSeptember 30 2020\t\tSeptember 30 2019\t\tChange\t\t% Change\n(in millions except percentages)\t\t\t\t\t\t\nInterest income-net\t2.5\t\t11.4\t\t(8.9)\t\t(78)%\nOther expense-net\t(1.0)\t\t(6.0)\t\t5.0\t\t(83)%\n", "q10k_tbl_49": "\tThree Months Ended\t\t\tChange\t% Change\nSeptember 30 2020\t\tSeptember 30 2019\t\n(in millions except percentages)\t\t\t\t\nProvision for income taxes\t5.0\t\t25.8\t(20.8)\t(81)%\nEffective tax rate (%)\t4%\t\t24%\t\t\n", "q10k_tbl_50": "\tNine Months Ended\t\t\t\t\t\t\t\t\t\t\nSeptember 30 2020\t\t\t\tSeptember 30 2019\t\t\t\t\t\t\nAmount\t\t% of Revenue\t\tAmount\t\t% of Revenue\t\tChange\t\t% Change\n(in millions except percentages)\t\t\t\t\t\t\t\t\t\t\nRevenue:\t\t\t\t\t\t\t\t\t\t\t\nProduct\t628.0\t\t34%\t\t549.7\t\t36%\t\t78.3\t\t14%\nService\t1218.4\t\t66\t\t995.2\t\t64\t\t223.2\t\t22\nTotal revenue\t1846.4\t\t100%\t\t1544.9\t\t100%\t\t301.5\t\t20%\nRevenue by geography:\t\t\t\t\t\t\t\t\t\t\t\nAmericas\t776.0\t\t42%\t\t668.0\t\t43%\t\t108.0\t\t16%\nEMEA\t693.5\t\t38\t\t571.1\t\t37\t\t122.4\t\t21\nAPAC\t376.9\t\t20\t\t305.8\t\t20\t\t71.1\t\t23\nTotal revenue\t1846.4\t\t100%\t\t1544.9\t\t100%\t\t301.5\t\t20%\n", "q10k_tbl_51": "\tNine Months Ended\t\t\t\t\t\t\nSeptember 30 2020\t\tSeptember 30 2019\t\tChange\t\t% Change\n(in millions except percentages)\t\t\t\t\t\t\nCost of revenue:\t\t\t\t\t\t\t\nProduct\t245.0\t\t231.9\t\t13.1\t\t6%\nService\t158.0\t\t133.5\t\t24.5\t\t18\nTotal cost of revenue\t403.0\t\t365.4\t\t37.6\t\t10%\nGross margin (%):\t\t\t\t\t\t\t\nProduct\t61.0%\t\t57.8%\t\t\t\t\nService\t87.0\t\t86.6\t\t\t\t\nTotal gross margin\t78.2%\t\t76.3%\t\t\t\t\n", "q10k_tbl_52": "\tNine Months Ended\t\t\t\t\t\t\tChange\t% Change\nSeptember 30 2020\t\t\t\tSeptember 30 2019\t\t\t\nAmount\t\t% of Revenue\t\tAmount\t\t% of Revenue\t\n(in millions except percentages)\t\t\t\t\t\t\t\t\nOperating expenses:\t\t\t\t\t\t\t\t\t\nResearch and development\t252.4\t\t14%\t\t205.9\t\t13%\t46.5\t23%\nSales and marketing\t780.5\t\t42\t\t669.8\t\t43\t110.7\t17\nGeneral and administrative\t87.1\t\t5\t\t74.9\t\t5\t12.2\t16\nGain on IP matter\t(39.0)\t\t(2)\t\t0\t\t0\t(39.0)\t*\nTotal operating expenses\t1081.0\t\t59%\t\t950.6\t\t62%\t130.4\t14%\n", "q10k_tbl_53": "\tNine Months Ended\t\t\t\t\t\t\nSeptember 30 2020\t\tSeptember 30 2019\t\tChange\t\t% Change\n(in millions except percentages)\t\t\t\t\t\t\nInterest income-net\t15.7\t\t32.6\t\t(16.9)\t\t(52)%\nOther expense-net\t(8.1)\t\t(6.9)\t\t(1.2)\t\t17%\n", "q10k_tbl_54": "\tNine Months Ended\t\t\tChange\t% Change\nSeptember 30 2020\t\tSeptember 30 2019\t\n(in millions except percentages)\t\t\t\t\nProvision for income taxes\t28.2\t\t41.1\t(12.9)\t(31)%\nEffective tax rate (%)\t8%\t\t16%\t\t\n", "q10k_tbl_55": "\tAs of\t\n\tSeptember 30 2020\tDecember 31 2019\n\t(in millions)\t\nCash and cash equivalents\t882.3\t1222.5\nInvestments\t892.3\t987.4\nTotal cash cash equivalents and investments\t1774.6\t2209.9\nWorking capital\t739.0\t1313.2\n\tNine Months Ended\t\n\tSeptember 30 2020\tSeptember 30 2019\n\t(in millions)\t\nNet cash provided by operating activities\t787.2\t617.6\nNet cash used in investing activities\t(7.8)\t(402.7)\nNet cash used in financing activities\t(1119.6)\t(151.8)\nNet increase (decrease) in cash and cash equivalents\t(340.2)\t63.1\n", "q10k_tbl_56": "\tDecember 31 2017\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nASSETS\t\t\t\nDEFERRED TAX ASSETS\t146.9\t(4.0)\t142.9\nTOTAL ASSETS\t2257.9\t(4.0)\t2253.9\nLIABILITIES AND STOCKHOLDERS' EQUITY\t\t\t\nCURRENT LIABILITIES:\t\t\t\nDeferred revenue\t793.8\t(9.1)\t784.7\nTotal current liabilities\t1027.2\t(9.1)\t1018.1\nDEFERRED REVENUE\t542.5\t(7.5)\t535.0\nTotal liabilities\t1668.5\t(16.6)\t1651.9\nSTOCKHOLDERS' EQUITY:\t\t\t\nAccumulated deficit\t(319.6)\t12.6\t(307.0)\nTotal stockholders' equity\t589.4\t12.6\t602.0\nTOTAL LIABILITIES AND STOCKHOLDERS' EQUITY\t2257.9\t(4.0)\t2253.9\n", "q10k_tbl_57": "\tDecember 31 2018\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nASSETS\t\t\t\nDEFERRED TAX ASSETS\t255.0\t(4.7)\t250.3\nTOTAL ASSETS\t3078.0\t(4.7)\t3073.3\nLIABILITIES AND STOCKHOLDERS' EQUITY\t\t\t\nCURRENT LIABILITIES:\t\t\t\nDeferred revenue\t965.9\t(11.0)\t954.9\nTotal current liabilities\t1256.4\t(11.0)\t1245.4\nDEFERRED REVENUE\t720.9\t(9.0)\t711.9\nTotal liabilities\t2067.8\t(20.0)\t2047.8\nSTOCKHOLDERS' EQUITY:\t\t\t\nAccumulated deficit\t(57.5)\t15.3\t(42.2)\nTotal stockholders' equity\t1010.2\t15.3\t1025.5\nTOTAL LIABILITIES AND STOCKHOLDERS' EQUITY\t3078.0\t(4.7)\t3073.3\n", "q10k_tbl_58": "\tMarch 31 2020\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nASSETS\t\t\t\nDEFERRED TAX ASSETS\t226.5\t(6.5)\t220.0\nTOTAL ASSETS\t3206.2\t(6.5)\t3199.7\nLIABILITIES AND STOCKHOLDERS' EQUITY\t\t\t\nCURRENT LIABILITIES:\t\t\t\nDeferred revenue\t1230.2\t(18.6)\t1211.6\nTotal current liabilities\t1543.0\t(18.6)\t1524.4\nDEFERRED REVENUE\t996.6\t(9.0)\t987.6\nTotal liabilities\t2669.9\t(27.6)\t2642.3\nSTOCKHOLDERS' EQUITY:\t\t\t\nRetained earnings (accumulated deficit)\t(589.2)\t21.1\t(568.1)\nTotal stockholders' equity\t536.3\t21.1\t557.4\nTOTAL LIABILITIES AND STOCKHOLDERS' EQUITY\t3206.2\t(6.5)\t3199.7\n", "q10k_tbl_59": "\tJune 30 2020\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nASSETS\t\t\t\nDEFERRED TAX ASSETS\t218.9\t(6.9)\t212.0\nTOTAL ASSETS\t3330.6\t(6.9)\t3323.7\nLIABILITIES AND STOCKHOLDERS' EQUITY\t\t\t\nCURRENT LIABILITIES:\t\t\t\nDeferred revenue\t1275.8\t(20.7)\t1255.1\nTotal current liabilities\t1611.9\t(20.7)\t1591.2\nDEFERRED REVENUE\t1047.0\t(9.0)\t1038.0\nTotal liabilities\t2786.7\t(29.7)\t2757.0\nSTOCKHOLDERS' EQUITY:\t\t\t\nAccumulated deficit\t(613.1)\t22.8\t(590.3)\nTotal stockholders' equity\t543.9\t22.8\t566.7\nTOTAL LIABILITIES AND STOCKHOLDERS' EQUITY\t3330.6\t(6.9)\t3323.7\n", "q10k_tbl_60": "\tYear Ended December 31 2017\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t917.7\t2.8\t920.5\nTotal revenue\t1494.9\t2.8\t1497.7\nGROSS PROFIT:\t\t\t\nService\t776.2\t2.8\t779.0\nTotal gross profit\t1109.6\t2.8\t1112.4\nOPERATING INCOME\t109.8\t2.8\t112.6\nINCOME BEFORE INCOME TAXES\t124.0\t2.8\t126.8\nPROVISION FOR INCOME TAXES\t92.6\t(1.2)\t91.4\nNET INCOME\t31.4\t4.0\t35.4\nNet income per share:\t\t\t\nBasic\t0.18\t0.02\t0.20\nDiluted\t0.18\t0.02\t0.20\n", "q10k_tbl_61": "\tYear Ended December 31 2018\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t1126.8\t3.4\t1130.2\nTotal revenue\t1801.2\t3.4\t1804.6\nGROSS PROFIT:\t\t\t\nService\t967.4\t3.4\t970.8\nTotal gross profit\t1350.8\t3.4\t1354.2\nOPERATING INCOME\t231.0\t3.4\t234.4\nINCOME BEFORE INCOME TAXES\t250.9\t3.4\t254.3\nBENEFIT FROM INCOME TAXES\t(81.3)\t0.7\t(80.6)\nNET INCOME\t332.2\t2.7\t334.9\nNet income per share:\t\t\t\nBasic\t1.96\t0.02\t1.98\nDiluted\t1.91\t0.01\t1.92\n", "q10k_tbl_62": "\tThree Months Ended March 31 2019\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t309.9\t0.4\t310.3\nTotal revenue\t472.6\t0.4\t473.0\nGROSS PROFIT:\t\t\t\nService\t267.1\t0.4\t267.5\nTotal gross profit\t359.6\t0.4\t360.0\nOPERATING INCOME\t50.6\t0.4\t51.0\nINCOME BEFORE INCOME TAXES\t60.3\t0.4\t60.7\nPROVISION FOR INCOME TAXES\t1.5\t0.1\t1.6\nNET INCOME\t58.8\t0.3\t59.1\nNet income per share:\t\t\t\nBasic\t0.35\t0\t0.35\nDiluted\t0.34\t0\t0.34\n", "q10k_tbl_63": "\tThree Months Ended June 30 2019\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t331.8\t2.1\t333.9\nTotal revenue\t521.7\t2.1\t523.8\nGROSS PROFIT:\t\t\t\nService\t286.2\t2.1\t288.3\nTotal gross profit\t393.4\t2.1\t395.5\nOPERATING INCOME\t75.2\t2.1\t77.3\nINCOME BEFORE INCOME TAXES\t85.8\t2.1\t87.9\nPROVISION FOR INCOME TAXES\t13.1\t0.6\t13.7\nNET INCOME\t72.7\t1.5\t74.2\nNet income per share:\t\t\t\nBasic\t0.42\t0.01\t0.43\nDiluted\t0.42\t0\t0.42\n", "q10k_tbl_64": "\tSix Months Ended June 30 2019\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t641.7\t2.5\t644.2\nTotal revenue\t994.3\t2.5\t996.8\nGROSS PROFIT:\t\t\t\nService\t553.3\t2.5\t555.8\nTotal gross profit\t753.0\t2.5\t755.5\nOPERATING INCOME\t125.8\t2.5\t128.3\nINCOME BEFORE INCOME TAXES\t146.1\t2.5\t148.6\nPROVISION FOR INCOME TAXES\t14.6\t0.7\t15.3\nNET INCOME\t131.5\t1.8\t133.3\nNet income per share:\t\t\t\nBasic\t0.77\t0.01\t0.78\nDiluted\t0.75\t0.01\t0.76\n", "q10k_tbl_65": "\tYear Ended December 31 2019\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t1367.7\t6.8\t1374.5\nTotal revenue\t2156.2\t6.8\t2163.0\nGROSS PROFIT:\t\t\t\nService\t1186.4\t6.8\t1193.2\nTotal gross profit\t1650.3\t6.8\t1657.1\nOPERATING INCOME\t344.2\t6.8\t351.0\nINCOME BEFORE INCOME TAXES\t379.2\t6.8\t386.0\nPROVISION FOR INCOME TAXES\t52.7\t1.6\t54.3\nNET INCOME\t326.5\t5.2\t331.7\nNet income per share:\t\t\t\nBasic\t1.91\t0.03\t1.94\nDiluted\t1.87\t0.03\t1.90\n", "q10k_tbl_66": "\tThree Months Ended March 31 2020\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t384.6\t0.8\t385.4\nTotal revenue\t576.9\t0.8\t577.7\nGROSS PROFIT:\t\t\t\nService\t332.2\t0.8\t333.0\nTotal gross profit\t448.2\t0.8\t449.0\nOPERATING INCOME\t115.9\t0.8\t116.7\nINCOME BEFORE INCOME TAXES\t117.1\t0.8\t117.9\nPROVISION FOR INCOME TAXES\t13.1\t0.2\t13.3\nNET INCOME\t104.0\t0.6\t104.6\nNet income per share:\t\t\t\nBasic\t0.61\t0\t0.61\nDiluted\t0.60\t0\t0.60\n", "q10k_tbl_67": "\tThree Months Ended June 30 2020\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t403.6\t2.1\t405.7\nTotal revenue\t615.5\t2.1\t617.6\nGROSS PROFIT:\t\t\t\nService\t352.9\t2.1\t355.0\nTotal gross profit\t480.4\t2.1\t482.5\nOPERATING INCOME\t116.7\t2.1\t118.8\nINCOME BEFORE INCOME TAXES\t121.6\t2.1\t123.7\nPROVISION FOR INCOME TAXES\t9.5\t0.4\t9.9\nNET INCOME\t112.1\t1.7\t113.8\nNet income per share:\t\t\t\nBasic\t0.69\t0.01\t0.70\nDiluted\t0.68\t0.01\t0.69\n", "q10k_tbl_68": "\tSix Months Ended June 30 2020\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nREVENUE:\t\t\t\nService\t788.2\t2.9\t791.1\nTotal revenue\t1192.4\t2.9\t1195.3\nGROSS PROFIT:\t\t\t\nService\t685.1\t2.9\t688.0\nTotal gross profit\t928.6\t2.9\t931.5\nOPERATING INCOME\t232.6\t2.9\t235.5\nINCOME BEFORE INCOME TAXES\t238.7\t2.9\t241.6\nPROVISION FOR INCOME TAXES\t22.6\t0.6\t23.2\nNET INCOME\t216.1\t2.3\t218.4\nNet income per share:\t\t\t\nBasic\t1.30\t0.01\t1.31\nDiluted\t1.27\t0.02\t1.29\n", "q10k_tbl_69": "\tYear Ended December 31 2017\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nCASH FLOWS FROM OPERATING ACTIVITIES:\t\t\t\nNet income\t31.4\t4.0\t35.4\nChanges in operating assets and liabilities:\t\t\t\nDeferred tax assets\t35.8\t(1.2)\t34.6\nDeferred revenue\t300.8\t(2.8)\t298.0\n", "q10k_tbl_70": "\tYear Ended December 31 2018\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nCASH FLOWS FROM OPERATING ACTIVITIES:\t\t\t\nNet income\t332.2\t2.7\t334.9\nChanges in operating assets and liabilities:\t\t\t\nDeferred tax assets\t(127.8)\t0.7\t(127.1)\nDeferred revenue\t352.1\t(3.4)\t348.7\n", "q10k_tbl_71": "\tYear Ended December 31 2019\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nCASH FLOWS FROM OPERATING ACTIVITIES:\t\t\t\nNet income\t326.5\t5.2\t331.7\nChanges in operating assets and liabilities:\t\t\t\nDeferred tax assets\t17.8\t1.6\t19.4\nDeferred revenue\t446.7\t(6.8)\t439.9\n", "q10k_tbl_72": "\tThree Months Ended March 31 2020\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nCASH FLOWS FROM OPERATING ACTIVITIES:\t\t\t\nNet income\t104.0\t0.6\t104.6\nChanges in operating assets and liabilities:\t\t\t\nDeferred tax assets\t7.1\t0.2\t7.3\nDeferred revenue\t90.9\t(0.8)\t90.1\n", "q10k_tbl_73": "\tSix Months Ended June 30 2020\t\t\n\tAs Previously Reported\tCorrections\tAs Corrected\nCASH FLOWS FROM OPERATING ACTIVITIES:\t\t\t\nNet income\t216.1\t2.3\t218.4\nChanges in operating assets and liabilities:\t\t\t\nDeferred tax assets\t13.0\t0.6\t13.6\nDeferred revenue\t186.9\t(2.9)\t184.0\n", "q10k_tbl_74": "\t\tIncorporated by reference herein\t\t\n\t\tForm\tDate\tExhibit Number\n3.1\tAmended and Restated Bylaws\tCurrent Report on Form 8-K (File No. 001-34511)\tJuly 21 2020\t3.1\n31.1*\tCertification of Chief Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002\t\t\t\n31.2*\tCertification of Chief Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002\t\t\t\n32.1#\tCertifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002\t\t\t\n101.INS*\tInline XBRL Instance Document - the instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.\t\t\t\n101.SCH*\tInline XBRL Taxonomy Extension Schema Document\t\t\t\n101.CAL*\tInline XBRL Taxonomy Extension Calculation Linkbase Document\t\t\t\n101.DEF*\tInline XBRL Taxonomy Extension Definition Linkbase Document\t\t\t\n101.LAB*\tInline XBRL Taxonomy Extension Label Linkbase Document\t\t\t\n101.PRE*\tInline XBRL Taxonomy Extension Presentation Linkbase Document\t\t\t\n104*\tCover Page Interactive Data File - the cover page from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30 2020 is formatted in inline XBRL.\t\t\t\n"}{"bs": "q10k_tbl_2", "is": "q10k_tbl_3", "cf": "q10k_tbl_7"}None
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 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: 001-34511
______________________________________
FORTINET, INC.
(Exact name of registrant as specified in its charter)
______________________________________
Delaware
77-0560389
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
899 Kifer Road
Sunnyvale, California94086
(Address of principal executive offices, including zip code)
(408) 235-7700
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Exchange Act:
Common Stock, $0.001 Par Value
FTNT
The Nasdaq Stock Market LLC
(Title of each class)
(Trading Symbol)
(Name of exchange on which registered)
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 (“Exchange Act”) 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.
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 Act). Yes ☐ No ☒
As of October 30, 2020, there were 162,332,075 shares of the registrant’s common stock outstanding.
(unaudited, in millions, except per share amounts)
September 30, 2020
December 31, 2019
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
882.3
$
1,222.5
Short-term investments
774.4
843.1
Accounts receivable—net
546.6
544.3
Inventory
134.5
117.9
Prepaid expenses and other current assets
46.8
41.2
Total current assets
2,384.6
2,769.0
LONG-TERM INVESTMENTS
117.9
144.3
PROPERTY AND EQUIPMENT—NET
419.4
344.3
DEFERRED CONTRACT COSTS
281.1
237.0
DEFERRED TAX ASSETS
230.1
226.3
GOODWILL
68.2
67.2
OTHER INTANGIBLE ASSETS—NET
25.3
31.1
OTHER ASSETS
59.6
60.0
TOTAL ASSETS
$
3,586.2
$
3,879.2
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable
$
95.9
$
96.4
Accrued liabilities
127.8
101.8
Accrued payroll and compensation
121.9
101.8
Deferred revenue
1,300.0
1,155.8
Total current liabilities
1,645.6
1,455.8
DEFERRED REVENUE
1,092.0
953.3
INCOME TAX LIABILITIES
79.3
82.8
OTHER LIABILITIES
56.1
44.9
Total liabilities
2,873.0
2,536.8
COMMITMENTS AND CONTINGENCIES (Note 13)
STOCKHOLDERS’ EQUITY:
Common stock, $0.001 par value—300 shares authorized; 162.3 and 171.7 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively
0.2
0.2
Additional paid-in capital
1,178.5
1,180.3
Accumulated other comprehensive income
1.4
1.1
Retained earnings (accumulated deficit)
(466.9)
160.8
Total stockholders’ equity
713.2
1,342.4
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
3,586.2
$
3,879.2
See notes to condensed consolidated financial statements.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Preparation—The unaudited condensed consolidated financial statements of Fortinet, Inc. and its wholly owned subsidiaries (collectively, “we,” “us” or “our”) have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial information, as well as the instructions to Form 10-Q pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements, and should be read in conjunction with our audited consolidated financial statements as of and for the year ended December 31, 2019, contained in our Annual Report on Form 10-K filed with the SEC on February 26, 2020. In the opinion of management, all adjustments, which includes normal recurring adjustments, considered necessary for a fair presentation have been included. All intercompany balances, transactions and cash flows have been eliminated. The results of operations for the three and nine months ended September 30, 2020 are not necessarily indicative of the results for the full year or for any future periods. The condensed consolidated balance sheet as of December 31, 2019 is derived from the audited consolidated financial statements for the year ended December 31, 2019. For 2020, the amounts previously reported as Income taxes payable are included in Accrued liabilities. Prior periods have been reclassified to conform with current period presentation.
The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates.
There have been no material changes to our significant accounting policies as of and for the three and nine months ended September 30, 2020.
Recently Adopted Accounting Standards
Financial Instruments
In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13—Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“Topic 326”), which provides guidance on how an entity should measure credit losses on financial instruments. The standard replaces the existing incurred loss model with an expected credit loss model for financial assets measured at amortized cost, including trade receivables, and requires that credit losses on available-for-sale debt securities be presented as an allowance rather than as a write-down. The new approach to estimating credit losses (referred to as the current expected credit losses model) generally accelerates recognition of credit losses. We adopted Topic 326 on January 1, 2020 using the modified retrospective method. The adoption of this standard did not have a material impact on our condensed consolidated financial statements.
Cloud Computing
In August 2018, the FASB issued ASU 2018-15—Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which requires a customer in a cloud computing arrangement that is a service contract to follow the internal-use software guidance in Accounting Standards Codification (“ASC”) Topic 350, Intangibles—Goodwill and Other, to determine which implementation costs to capitalize as assets or expense as incurred. We adopted ASU 2018-15 on January 1, 2020. The adoption of this standard did not have a material impact on our condensed consolidated financial statements.
Fair Value Measurements
In August 2018, the FASB issued ASU 2018-13—Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates, adds and modifies certain disclosure requirements for fair value measurements in ASC 820, Fair Value Measurement, as part of its disclosure framework project. We adopted ASU 2018-13 on January 1, 2020. The adoption of this standard did not have a material impact on our disclosures.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Recent Accounting Standards Not Yet Effective
Income Taxes
In December 2019, the FASB issued ASU 2019-12—Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The amendments in ASU 2019-12 simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application and simplification of GAAP for other areas of Topic 740 by clarifying and amending existing guidance. ASU 2019-12 is effective for us beginning on January 1, 2021. We are currently evaluating the impact of ASU 2019-12 on our condensed consolidated financial statements.
2. IMMATERIAL CORRECTION OF PRIOR PERIOD FINANCIAL STATEMENTS
Subsequent to the issuance of our condensed consolidated financial statements for the period ended June 30, 2020, we identified an immaterial error related to the commencement of revenue recognition for certain FortiCare standalone service contracts. Rather than commencing recognition upon end user registration, we should have begun to recognize revenue over the service period when control had passed to the distributor which we have determined is our customer. We assessed the effect of this correction, individually and in the aggregate, on prior periods’ financial statements in accordance with the SEC’s Staff Accounting Bulletins No. 99 and 108 and, based on an analysis of quantitative and qualitative factors, determined that the correction was not individually material to any of our prior interim or annual consolidated financial statements.
All financial information contained in the accompanying notes to these condensed consolidated financial statements has been revised to reflect the correction of this error.
The corrections to our condensed consolidated balance sheet as of December 31, 2019 were as follows (in millions):
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The corrections to our condensed consolidated statements of income for the three and nine months ended September 30, 2019 were as follows (in millions, except per share amounts):
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The corrections to our condensed consolidated statements of cash flows for the nine months ended September 30, 2019 were as follows (in millions):
Nine Months Ended September 30, 2019
As Previously Reported
Corrections
As Corrected
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income
$
211.3
$
2.2
$
213.5
Changes in operating assets and liabilities:
Deferred tax assets
10.6
0.9
11.5
Deferred revenue
258.8
(3.1)
255.7
Net cash provided by operating activities
$
617.6
$
—
$
617.6
The results for the nine months ended September 30, 2020 include corrections to increase revenue, gross profit and operating income by $0.8 million and $2.1 million for the three months ended March 31, 2020 and June 30, 2020, respectively, and to increase net income by $0.6 million and $1.7 million for the three months ended March 31, 2020 and June 30, 2020, respectively. The correction did not change diluted net income per share for the three months ended March 31, 2020 but did increase diluted net income per share by $0.01 for the three months ended June 30, 2020. For all periods in which we corrected net income, we made corresponding corrections to net income and comprehensive income in our condensed consolidated statements of comprehensive income and to net income, retained earnings (accumulated deficit) and total stockholders’ equity in our condensed consolidated statements of stockholders’ equity.
3. REVENUE RECOGNITION
We sell cybersecurity solutions to a variety of organizations, such as enterprises, communication service providers, government organizations and small businesses. Our revenue consists of product and service revenue. Product revenue is generated by our FortiGate network security appliances, our Fortinet Security Fabric platform products and other products. Service revenue relates to sales of our security subscription services, which mainly consist of our FortiGuard security solutions, as well as our FortiCare technical support services and other services.
Disaggregation of Revenue
The following table presents our revenue disaggregated by major product and service lines (in millions):
Three Months Ended
Nine Months Ended
September 30, 2020
September 30, 2019
September 30, 2020
September 30, 2019
Product
$
223.8
$
197.1
$
628.0
$
549.7
Service:
Security subscription
235.4
192.8
669.4
545.5
Technical support and other
191.9
158.2
549.0
449.7
Total service revenue
427.3
351.0
1,218.4
995.2
Total revenue
$
651.1
$
548.1
$
1,846.4
$
1,544.9
Deferred Revenue
During the three months ended September 30, 2020 and September 30, 2019, we recognized $263.1 million and $211.8 million in service revenue that was included in the deferred revenue balance as of December 31, 2019 and December 31, 2018, respectively. During the nine months ended September 30, 2020 and September 30, 2019, we recognized $921.7 million and $754.5 million in service revenue that was included in the deferred revenue balance as of December 31, 2019 and December 31, 2018, respectively.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Transaction Price Allocated to the Remaining Performance Obligations
As of September 30, 2020, the aggregate amount of the transaction price allocated to remaining performance obligations was $2.39 billion, which was substantially comprised of deferred security subscription and technical support services revenue. We expect to recognize approximately $1.30 billion as revenue over the next 12 months and the remainder thereafter.
Accounts Receivable
Trade accounts receivable are recorded at the invoiced amount. On January 1, 2020, we adopted Topic 326, which provides guidance on how to measure credit losses on financial instruments, including accounts receivable. Prior to our adoption of Topic 326, our accounts receivable balance was reduced by an allowance for doubtful accounts that we determined based on our assessment of the collectability of customer accounts. Under Topic 326, our accounts receivable balance is reduced by an allowance for expected credit losses. We measure expected credit losses of accounts receivable on a collective (pooled) basis, aggregating accounts receivable that are either current or no more than 60 days past due, and aggregating accounts receivable that are more than 60 days past due. We apply a credit-loss percentage to each of the pools that is based on our historical credit losses. We review whether each of our significant accounts receivable that is more than 60 days past due continues to exhibit similar risk characteristics with the other accounts receivable in the pool. If we determine that it does not, we evaluate it for expected credit losses on an individual basis.
The COVID-19 pandemic and the recent economic downturn prompted us to perform additional credit reviews of our existing customers, including obtaining recent credit reports and reviewing their latest available statements of financial position. In addition, we have seen an increase in requests for extended payment terms. After performing our additional reviews, we increased the allowance for credit losses for certain accounts receivable.
The allowance for credit losses was $2.2 million as of September 30, 2020, and the allowance for doubtful accounts was $1.2 million as of December 31, 2019. Provisions, write-offs and recoveries were not material during the nine months ended September 30, 2020.
Deferred Contract Costs
Sales commissions earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. The amortization of deferred contract costs is included in sales and marketing expense in our condensed consolidated statements of income. Amortization of deferred contract costs during the three months ended September 30, 2020 and September 30, 2019 were $35.3 million and $27.5 million, respectively. Amortization of deferred contract costs during the nine months ended September 30, 2020 and September 30, 2019 were $99.8 million and $78.5 million, respectively.
4. FINANCIAL INSTRUMENTS AND FAIR VALUE
The following tables summarize our investments (in millions):