Company Quick10K Filing
Red Violet
Price12.80 EPS-1
Shares12 P/E-24
MCap148 P/FCF339
Net Debt-13 EBIT-6
TEV134 TEV/EBIT-22
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-08-11
10-Q 2020-03-31 Filed 2020-05-11
10-K 2019-12-31 Filed 2020-03-12
10-Q 2019-09-30 Filed 2019-11-07
10-Q 2019-06-30 Filed 2019-08-05
10-Q 2019-03-31 Filed 2019-05-07
10-K 2018-12-31 Filed 2019-03-07
10-Q 2018-09-30 Filed 2018-11-07
10-Q 2018-06-30 Filed 2018-08-08
10-Q 2018-03-31 Filed 2018-05-14
8-K 2020-08-11 Earnings, Exhibits
8-K 2020-06-03
8-K 2020-05-11
8-K 2020-03-12
8-K 2019-11-07
8-K 2019-08-28
8-K 2019-08-05
8-K 2019-05-15
8-K 2019-05-07
8-K 2019-03-07
8-K 2019-01-24
8-K 2018-11-07
8-K 2018-09-05
8-K 2018-08-08
8-K 2018-05-14
8-K 2018-03-22

RDVT 10Q Quarterly Report

Part I - Financial Information
Item 1. Financial Statements.
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 rdvt-ex311_7.htm
EX-31.2 rdvt-ex312_9.htm
EX-32.1 rdvt-ex321_6.htm
EX-32.2 rdvt-ex322_8.htm

Red Violet Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
504030201002016201720182020
Assets, Equity
10.07.24.41.7-1.1-3.92016201720182020
Rev, G Profit, Net Income
25191382-22016201720182020
Ops, Inv, Fin

rdvt-10q_20200630.htm
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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 June 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 001-38407

 

RED VIOLET, INC.

(Exact Name of Registrant as Specified in Its Charter)

 

 

Delaware

 

82-2408531

(State or Other Jurisdiction of Incorporation or Organization)

 

(I.R.S. Employer Identification No.)

 

2650 North Military Trail, Suite 300, Boca Raton, Florida 33431

(Address of Principal Executive Offices) (Zip Code)

(561) 757-4000

(Registrant’s Telephone Number, Including Area Code)

None

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol (s)

Name of each exchange on which registered

Common Stock, $0.001 par value per share

RDVT

The 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.

 

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 August 7, 2020, the registrant had 12,137,576 shares of common stock outstanding.

 


 

RED VIOLET, INC.

TABLE OF CONTENTS FOR FORM 10-Q

 

 

 

 

 

Page

PART I - FINANCIAL INFORMATION

 

 

 

 

 

 

 

Item 1.

 

Financial Statements (unaudited)

 

 

 

 

Condensed consolidated balance sheets as of June 30, 2020 and December 31, 2019

 

2

 

 

Condensed consolidated statements of operations for the three and six months ended June 30, 2020 and 2019

 

3

 

 

Condensed consolidated statements of changes in shareholders' equity for the three and six months ended June 30, 2020 and 2019

 

4

 

 

Condensed consolidated statements of cash flows for the six months ended June 30, 2020 and 2019

 

5

 

 

Notes to condensed consolidated financial statements

 

6

Item 2.

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

 

14

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

21

Item 4.

 

Controls and Procedures

 

21

 

 

 

 

 

PART II - OTHER INFORMATION

 

 

 

 

 

 

 

Item 1.

 

Legal Proceedings

 

22

Item 1A.

 

Risk Factors

 

22

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

23

Item 3.

 

Defaults Upon Senior Securities

 

23

Item 4.

 

Mine Safety Disclosures

 

23

Item 5.

 

Other Information

 

23

Item 6.

 

Exhibits

 

24

 

 

 

 

 

SIGNATURES

 

25

 

1


PART I - FINANCIAL INFORMATION

Unless otherwise indicated or required by the context, all references in this Quarterly Report on Form 10-Q to “we,” “us,” “our,” “red violet,” or the “Company,” refer to Red Violet, Inc. and its consolidated subsidiaries.

Item 1. Financial Statements.

 

RED VIOLET, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share data)

(unaudited)

 

 

 

June 30, 2020

 

 

December 31, 2019

 

ASSETS:

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

13,782

 

 

$

11,776

 

Accounts receivable, net of allowance for doubtful accounts of $53 and $40

  as of June 30, 2020 and December 31, 2019, respectively

 

 

2,691

 

 

 

3,543

 

Prepaid expenses and other current assets

 

 

861

 

 

 

722

 

Total current assets

 

 

17,334

 

 

 

16,041

 

Property and equipment, net

 

 

586

 

 

 

660

 

Intangible assets, net

 

 

26,394

 

 

 

24,034

 

Goodwill

 

 

5,227

 

 

 

5,227

 

Right-of-use assets

 

 

2,395

 

 

 

2,620

 

Other noncurrent assets

 

 

137

 

 

 

289

 

Total assets

 

$

52,073

 

 

$

48,871

 

LIABILITIES AND SHAREHOLDERS' EQUITY:

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

2,723

 

 

$

2,138

 

Accrued expenses and other current liabilities

 

 

644

 

 

 

1,571

 

Current portion of operating lease liabilities

 

 

521

 

 

 

491

 

Current portion of long-term loan

 

 

702

 

 

 

-

 

Deferred revenue

 

 

151

 

 

 

128

 

Total current liabilities

 

 

4,741

 

 

 

4,328

 

Noncurrent operating lease liabilities

 

 

2,192

 

 

 

2,459

 

Long-term loan

 

 

1,450

 

 

 

-

 

Total liabilities

 

 

8,383

 

 

 

6,787

 

Shareholders' equity:

 

 

 

 

 

 

 

 

Preferred stock—$0.001 par value, 10,000,000 shares authorized, and 0 shares

  issued and outstanding, as of June 30, 2020 and December 31, 2019

 

 

-

 

 

 

-

 

Common stock—$0.001 par value, 200,000,000 shares authorized, 11,707,829 and

  11,657,912 shares issued, 11,604,682 and 11,554,765 shares outstanding, as of

  June 30, 2020 and December 31, 2019

 

 

12

 

 

 

12

 

Treasury stock, at cost, 103,147 shares as of June 30, 2020 and December 31, 2019

 

 

(1,255

)

 

 

(1,255

)

Additional paid-in capital

 

 

64,806

 

 

 

59,187

 

Accumulated deficit

 

 

(19,873

)

 

 

(15,860

)

Total shareholders' equity

 

 

43,690

 

 

 

42,084

 

Total liabilities and shareholders' equity

 

$

52,073

 

 

$

48,871

 

 

See notes to condensed consolidated financial statements

2


RED VIOLET, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except share data)

(unaudited)

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Revenue

 

$

7,056

 

 

$

7,245

 

 

$

16,356

 

 

$

12,979

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue (exclusive of depreciation and amortization)

 

 

2,587

 

 

 

3,052

 

 

 

5,879

 

 

 

5,721

 

Sales and marketing expenses

 

 

1,746

 

 

 

2,003

 

 

 

3,922

 

 

 

3,503

 

General and administrative expenses

 

 

4,263

 

 

 

5,396

 

 

 

8,697

 

 

 

7,761

 

Depreciation and amortization

 

 

992

 

 

 

681

 

 

 

1,902

 

 

 

1,299

 

Total costs and expenses

 

 

9,588

 

 

 

11,132

 

 

 

20,400

 

 

 

18,284

 

Loss from operations

 

 

(2,532

)

 

 

(3,887

)

 

 

(4,044

)

 

 

(5,305

)

Interest income, net

 

 

-

 

 

 

37

 

 

 

31

 

 

 

77

 

Loss before income taxes

 

 

(2,532

)

 

 

(3,850

)

 

 

(4,013

)

 

 

(5,228

)

Income taxes

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Net loss

 

$

(2,532

)

 

$

(3,850

)

 

$

(4,013

)

 

$

(5,228

)

Loss per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

$

(0.22

)

 

$

(0.37

)

 

$

(0.35

)

 

$

(0.51

)

Weighted average number of shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

 

11,617,342

 

 

 

10,298,613

 

 

 

11,600,278

 

 

 

10,283,232

 

 

See notes to condensed consolidated financial statements

3


RED VIOLET, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Amounts in thousands, except share data)

(unaudited)

 

 

 

Common stock

 

 

Treasury stock

 

 

Additional paid-in

 

 

Accumulated

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

capital

 

 

deficit

 

 

Total

 

Balance at March 31, 2019

 

 

10,286,613

 

 

$

10

 

 

 

-

 

 

$

-

 

 

$

41,476

 

 

$

(6,162

)

 

$

35,324

 

Vesting of restricted stock units

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Share-based compensation

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,777

 

 

 

-

 

 

 

3,777

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(3,850

)

 

 

(3,850

)

Balance at June 30, 2019

 

 

10,286,613

 

 

$

10

 

 

 

-

 

 

$

-

 

 

$

45,253

 

 

$

(10,012

)

 

$

35,251

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at March 31, 2020

 

 

11,693,162

 

 

$

12

 

 

 

(103,147

)

 

$

(1,255

)

 

$

61,996

 

 

$

(17,341

)

 

$

43,412

 

Vesting of restricted stock units

 

 

14,667

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Share-based compensation

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,810

 

 

 

-

 

 

 

2,810

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,532

)

 

 

(2,532

)

Balance at June 30, 2020

 

 

11,707,829

 

 

$

12

 

 

 

(103,147

)

 

$

(1,255

)

 

$

64,806

 

 

$

(19,873

)

 

$

43,690

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

Treasury stock

 

 

Additional paid-in

 

 

Accumulated

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

capital

 

 

deficit

 

 

Total

 

Balance at December 31, 2018

 

 

10,266,613

 

 

$

10

 

 

 

-

 

 

$

-

 

 

$

41,052

 

 

$

(4,784

)

 

$

36,278

 

Vesting of restricted stock units

 

 

20,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Share-based compensation

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,201

 

 

 

-

 

 

 

4,201

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(5,228

)

 

 

(5,228

)

Balance at June 30, 2019

 

 

10,286,613

 

 

$

10

 

 

 

-

 

 

$

-

 

 

$

45,253

 

 

$

(10,012

)

 

$

35,251

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2019

 

 

11,657,912

 

 

$

12

 

 

 

(103,147

)

 

$

(1,255

)

 

$

59,187

 

 

$

(15,860

)

 

$

42,084

 

Vesting of restricted stock units

 

 

49,917

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Share-based compensation

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,619

 

 

 

-

 

 

 

5,619

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(4,013

)

 

 

(4,013

)

Balance at June 30, 2020

 

 

11,707,829

 

 

$

12

 

 

 

(103,147

)

 

$

(1,255

)

 

$

64,806

 

 

$

(19,873

)

 

$

43,690

 

 

See notes to condensed consolidated financial statements

4


RED VIOLET, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(unaudited)

 

 

 

Six Months Ended June 30,

 

 

 

2020

 

 

2019

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net loss

 

$

(4,013

)

 

$

(5,228

)

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

1,902

 

 

 

1,299

 

Share-based compensation expense

 

 

4,563

 

 

 

3,883

 

Write-off of long-lived assets

 

 

104

 

 

 

30

 

Provision for bad debts

 

 

265

 

 

 

326

 

Noncash lease expenses

 

 

225

 

 

 

207

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

587

 

 

 

(1,687

)

Prepaid expenses and other current assets

 

 

(139

)

 

 

49

 

Other noncurrent assets

 

 

65

 

 

 

169

 

Accounts payable

 

 

585

 

 

 

44

 

Accrued expenses and other current liabilities

 

 

(927

)

 

 

-

 

Deferred revenue

 

 

23

 

 

 

30

 

Operating lease liabilities

 

 

(237

)

 

 

(212

)

Net cash provided by (used in) operating activities

 

 

3,003

 

 

 

(1,090

)

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Purchase of property and equipment

 

 

(61

)

 

 

(32

)

Capitalized costs included in intangible assets

 

 

(3,088

)

 

 

(2,913

)

Net cash used in investing activities

 

 

(3,149

)

 

 

(2,945

)

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Proceeds from long-term loan

 

 

2,152

 

 

 

-

 

Net cash provided by financing activities

 

 

2,152

 

 

 

-

 

Net increase (decrease) in cash and cash equivalents

 

$

2,006

 

 

$

(4,035

)

Cash and cash equivalents at beginning of period

 

 

11,776

 

 

 

9,950

 

Cash and cash equivalents at end of period

 

$

13,782

 

 

$

5,915

 

SUPPLEMENTAL DISCLOSURE INFORMATION

 

 

 

 

 

 

 

 

Cash paid for interest

 

$

-

 

 

$

-

 

Cash paid for income taxes

 

$

-

 

 

$

-

 

Share-based compensation capitalized in intangible assets

 

$

1,056

 

 

$

318

 

Right-of-use assets obtained in exchange of operating lease liabilities

 

$

-

 

 

$

3,042

 

Operating lease liabilities arising from obtaining right-of-use assets

 

$

-

 

 

$

3,387

 

 

See notes to condensed consolidated financial statements

5


RED VIOLET, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands, except share data)

(unaudited)

1. Summary of significant accounting policies

(a) Basis of preparation

The accompanying unaudited condensed consolidated financial statements of Red Violet, Inc. (“red violet” or the “Company”), a Delaware corporation, have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations.

The accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for any future interim periods or for the full year ending December 31, 2020.

The information included in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (“2019 Form 10-K”).

The condensed consolidated balance sheet as of December 31, 2019 included herein was derived from the audited financial statements as of that date included in the 2019 Form 10-K, but does not include all disclosures required by GAAP.

The Company has only one operating segment, as defined by Accounting Standards Codification (“ASC”) 280, “Segment Reporting.”

Principles of consolidation

The condensed consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant transactions among the Company and its subsidiaries have been eliminated upon consolidation.

(b) Recently issued accounting standards

 

As an emerging growth company, the Company has left open the opportunity to take advantage of the extended transition period provided to emerging growth companies in Section 13(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), however, it is the Company’s present intention to adopt any applicable new accounting standards timely.

In June 2016, FASB issued ASU No. 2016-13 (“ASU 2016-13”), “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” In November 2018, FASB issued ASU No. 2018-19, “Codification Improvements to Topic 326, Financial Instruments-Credit Losses,” which amends the scope and transition requirements of ASU 2016-13. Topic 326 requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectability of the reported amount. Topic 326 became effective for public companies beginning January 1, 2020, and the Company adopted it on a modified retrospective approach. The guidance had no material impact on the Company’s condensed consolidated financial statements and related disclosures.

In August 2018, FASB issued ASU No. 2018-15 (“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 an entity (customer) in a hosting arrangement that is a service contract to follow the guidance in Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. It also requires the entity (customer) to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement, which includes reasonably certain renewals. This guidance will be effective for the Company for annual reporting periods beginning after December 15, 2020, on a retrospective or prospective basis and early adoption is permitted. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements and related disclosures.

 

6


2. Loss per share

 

Basic loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the periods. Diluted loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock and is calculated using the treasury stock method for unvested shares. Common equivalent shares are excluded from the calculation in the loss periods as their effects would be anti-dilutive.

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

(In thousands, except share data)

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Numerator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(2,532

)

 

$

(3,850

)

 

$

(4,013

)

 

$

(5,228

)

Denominator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - Basic and diluted (1)

 

 

11,617,342

 

 

 

10,298,613

 

 

 

11,600,278

 

 

 

10,283,232

 

Loss per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted:

 

$

(0.22

)

 

$

(0.37

)

 

$

(0.35

)

 

$

(0.51

)

 

(1)

A total of 2,189,910 unvested restricted stock units (“RSUs”) have been excluded from the diluted loss per share for the three and six months ended June 30, 2020, and 2,237,000 RSUs have been excluded for the three and six months ended June 30, 2019, as the impact is anti-dilutive.

 

3. Intangible assets, net

Intangible assets other than goodwill consist of the following:

 

 

 

 

 

June 30, 2020

 

 

December 31, 2019

 

(In thousands)

 

Amortization

Period

 

Gross Amount

 

 

Accumulated Amortization

 

 

Net

 

 

Gross Amount

 

 

Accumulated Amortization

 

 

Net

 

Software developed for internal use

 

5-10 years

 

$

33,834

 

 

$

(7,440

)

 

$

26,394

 

 

$

29,690

 

 

$

(5,656

)

 

$

24,034

 

The gross amount associated with software developed for internal use represents capitalized costs of internally-developed software, including eligible salaries and staff benefits, share-based compensation, travel expenses incurred by relevant employees, and other relevant costs.

Amortization expenses of $934 and $617 for the three months ended June 30, 2020 and 2019, respectively, and $1,784 and $1,171 for the six months ended June 30, 2020 and 2019, respectively, were included in depreciation and amortization expense. As of June 30, 2020, intangible assets of $4,322, included in the gross amounts of software developed for internal use, have not started amortization, as they are not ready for their intended use.

The Company capitalized costs of software developed for internal use of $2,018 and $1,651 during the three months ended June 30, 2020 and 2019, respectively, and $4,144 and $3,231 during the six months ended June 30, 2020 and 2019, respectively.

As of June 30, 2020, estimated amortization expense related to the Company’s intangible assets for the remainder of 2020 through 2025 and thereafter are as follows:

 

(In thousands)

 

 

 

 

Year

 

June 30, 2020

 

Remainder of 2020

 

$

1,939

 

2021

 

 

4,728