2017 Q2 Form 10-Q Financial Statement

#000139297217000102 Filed on August 03, 2017

View on sec.gov

Income Statement

Concept 2017 Q2 2016 Q2
Revenue $40.41M $37.04M
YoY Change 9.09% -11.16%
Cost Of Revenue $16.09M $16.05M
YoY Change 0.24% 2.02%
Gross Profit $24.32M $20.99M
YoY Change 15.86% -19.14%
Gross Profit Margin 60.19% 56.67%
Selling, General & Admin $26.95M $25.68M
YoY Change 4.95% -6.75%
% of Gross Profit 110.83% 122.35%
Research & Development $14.08M $13.36M
YoY Change 5.38% 18.35%
% of Gross Profit 57.88% 63.64%
Depreciation & Amortization $1.980M $2.500M
YoY Change -20.8% 5.49%
% of Gross Profit 8.14% 11.91%
Operating Expenses $41.03M $39.04M
YoY Change 5.1% 0.55%
Operating Profit -$16.71M -$18.05M
YoY Change -7.42% 40.27%
Interest Expense -$2.590M -$2.320M
YoY Change 11.64% 4.5%
% of Operating Profit
Other Income/Expense, Net -$64.00K -$55.00K
YoY Change 16.36% -73.43%
Pretax Income -$19.36M -$20.42M
YoY Change -5.18% 33.49%
Income Tax $149.0K $105.0K
% Of Pretax Income
Net Earnings -$19.51M -$20.53M
YoY Change -4.94% 31.01%
Net Earnings / Revenue -48.29% -55.42%
Basic Earnings Per Share -$0.62 -$0.68
Diluted Earnings Per Share -$0.62 -$0.68
COMMON SHARES
Basic Shares Outstanding 31.62M shares 30.33M shares
Diluted Shares Outstanding 31.62M shares 30.33M shares

Balance Sheet

Concept 2017 Q2 2016 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments $204.0M $145.1M
YoY Change 40.59% -7.58%
Cash & Equivalents $198.0M $103.2M
Short-Term Investments $6.000M $42.00M
Other Short-Term Assets $7.000M $7.500M
YoY Change -6.67% 1.35%
Inventory
Prepaid Expenses
Receivables $33.30M $36.80M
Other Receivables $0.00 $0.00
Total Short-Term Assets $244.2M $189.3M
YoY Change 29.0% -15.7%
LONG-TERM ASSETS
Property, Plant & Equipment $14.61M $15.49M
YoY Change -5.66% -1.87%
Goodwill $20.91M $20.62M
YoY Change 1.38% 0.04%
Intangibles $11.84M $12.79M
YoY Change -7.37% -24.79%
Long-Term Investments
YoY Change
Other Assets $6.378M $2.699M
YoY Change 136.31% 77.57%
Total Long-Term Assets $53.74M $51.60M
YoY Change 4.16% -6.05%
TOTAL ASSETS
Total Short-Term Assets $244.2M $189.3M
Total Long-Term Assets $53.74M $51.60M
Total Assets $298.0M $240.9M
YoY Change 23.68% -13.81%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $5.300M $4.718M
YoY Change 12.34% -49.54%
Accrued Expenses $10.42M $4.883M
YoY Change 113.39% -6.33%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $96.81M $89.21M
YoY Change 8.52% 8.5%
LONG-TERM LIABILITIES
Long-Term Debt $207.5M $119.0M
YoY Change 74.37% 4.94%
Other Long-Term Liabilities $655.0K $710.0K
YoY Change -7.75% -31.4%
Total Long-Term Liabilities $655.0K $710.0K
YoY Change -7.75% -31.4%
TOTAL LIABILITIES
Total Short-Term Liabilities $96.81M $89.21M
Total Long-Term Liabilities $655.0K $710.0K
Total Liabilities $318.4M $219.2M
YoY Change 45.25% 9.07%
SHAREHOLDERS EQUITY
Retained Earnings -$200.0M -$126.0M
YoY Change 58.67% 156.59%
Common Stock $36.00K $35.00K
YoY Change 2.86% 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost) $13.94M $13.94M
YoY Change 0.0% 0.0%
Treasury Stock Shares 4.418M shares 4.418M shares
Shareholders Equity -$20.46M $21.70M
YoY Change
Total Liabilities & Shareholders Equity $298.0M $240.9M
YoY Change 23.68% -13.81%

Cashflow Statement

Concept 2017 Q2 2016 Q2
OPERATING ACTIVITIES
Net Income -$19.51M -$20.53M
YoY Change -4.94% 31.01%
Depreciation, Depletion And Amortization $1.980M $2.500M
YoY Change -20.8% 5.49%
Cash From Operating Activities -$9.120M -$6.610M
YoY Change 37.97% -293.84%
INVESTING ACTIVITIES
Capital Expenditures -$940.0K -$1.890M
YoY Change -50.26% 122.35%
Acquisitions
YoY Change
Other Investing Activities $0.00 -$6.980M
YoY Change -100.0% -641.09%
Cash From Investing Activities -$950.0K -$8.870M
YoY Change -89.29% -2115.91%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities 96.39M -80.00K
YoY Change -120587.5% -260.0%
NET CHANGE
Cash From Operating Activities -9.120M -6.610M
Cash From Investing Activities -950.0K -8.870M
Cash From Financing Activities 96.39M -80.00K
Net Change In Cash 86.32M -15.56M
YoY Change -654.76% -498.97%
FREE CASH FLOW
Cash From Operating Activities -$9.120M -$6.610M
Capital Expenditures -$940.0K -$1.890M
Free Cash Flow -$8.180M -$4.720M
YoY Change 73.31% -210.8%

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LicensesRevenue
5759000 USD
CY2017Q2 us-gaap Licenses Revenue
LicensesRevenue
1090000 USD
us-gaap Licenses Revenue
LicensesRevenue
3280000 USD
CY2017Q2 us-gaap Line Of Credit
LineOfCredit
0 USD
CY2017Q2 us-gaap Line Of Credit Facility Maximum Borrowing Capacity
LineOfCreditFacilityMaximumBorrowingCapacity
50000000 USD
CY2017Q2 us-gaap Long Term Debt Percentage Bearing Fixed Interest Rate
LongTermDebtPercentageBearingFixedInterestRate
0.02
CY2016Q2 us-gaap Maintenance Costs
MaintenanceCosts
3578000 USD
us-gaap Maintenance Costs
MaintenanceCosts
6850000 USD
CY2017Q2 us-gaap Maintenance Costs
MaintenanceCosts
2881000 USD
us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
5339000 USD
us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
695000 USD
us-gaap Maintenance Costs
MaintenanceCosts
6027000 USD
CY2016Q2 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
-394000 USD
us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
362000 USD
CY2017Q2 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
1116000 USD
us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
1376000 USD
CY2016Q2 us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
-373000 USD
us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
388000 USD
CY2017Q2 us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
1119000 USD
CY2016Q2 us-gaap Maintenance Revenue
MaintenanceRevenue
16775000 USD
us-gaap Maintenance Revenue
MaintenanceRevenue
33437000 USD
CY2017Q2 us-gaap Maintenance Revenue
MaintenanceRevenue
17132000 USD
us-gaap Maintenance Revenue
MaintenanceRevenue
35208000 USD
us-gaap Net Cash Provided By Used In Financing Activities
NetCashProvidedByUsedInFinancingActivities
-4446000 USD
us-gaap Net Cash Provided By Used In Financing Activities
NetCashProvidedByUsedInFinancingActivities
93518000 USD
us-gaap Net Cash Provided By Used In Investing Activities
NetCashProvidedByUsedInInvestingActivities
-44839000 USD
us-gaap Net Cash Provided By Used In Investing Activities
NetCashProvidedByUsedInInvestingActivities
7980000 USD
us-gaap Net Cash Provided By Used In Operating Activities
NetCashProvidedByUsedInOperatingActivities
-9372000 USD
us-gaap Net Cash Provided By Used In Operating Activities
NetCashProvidedByUsedInOperatingActivities
-21309000 USD
CY2016Q2 us-gaap Net Income Loss
NetIncomeLoss
-20527000 USD
us-gaap Net Income Loss
NetIncomeLoss
-41004000 USD
CY2017Q2 us-gaap Net Income Loss
NetIncomeLoss
-19513000 USD
us-gaap Net Income Loss
NetIncomeLoss
-39720000 USD
CY2016Q2 us-gaap Operating Income Loss
OperatingIncomeLoss
-18050000 USD
us-gaap Operating Income Loss
OperatingIncomeLoss
-36024000 USD
CY2017Q2 us-gaap Operating Income Loss
OperatingIncomeLoss
-16710000 USD
us-gaap Operating Income Loss
OperatingIncomeLoss
-34378000 USD
CY2017Q2 us-gaap Operating Leases Future Minimum Payments Due
OperatingLeasesFutureMinimumPaymentsDue
8106000 USD
CY2017Q2 us-gaap Operating Leases Future Minimum Payments Due In Five Years
OperatingLeasesFutureMinimumPaymentsDueInFiveYears
415000 USD
CY2017Q2 us-gaap Operating Leases Future Minimum Payments Due In Four Years
OperatingLeasesFutureMinimumPaymentsDueInFourYears
902000 USD
CY2017Q2 us-gaap Operating Leases Future Minimum Payments Due In Three Years
OperatingLeasesFutureMinimumPaymentsDueInThreeYears
2043000 USD
CY2017Q2 us-gaap Operating Leases Future Minimum Payments Due In Two Years
OperatingLeasesFutureMinimumPaymentsDueInTwoYears
2754000 USD
CY2017Q2 us-gaap Operating Leases Future Minimum Payments Due Thereafter
OperatingLeasesFutureMinimumPaymentsDueThereafter
143000 USD
CY2016Q4 us-gaap Other Assets Noncurrent
OtherAssetsNoncurrent
6013000 USD
CY2017Q2 us-gaap Other Assets Noncurrent
OtherAssetsNoncurrent
6378000 USD
us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
1366000 USD
CY2016Q2 us-gaap Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Net Of Tax
OtherComprehensiveIncomeUnrealizedHoldingGainLossOnSecuritiesArisingDuringPeriodNetOfTax
21000 USD
us-gaap Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Net Of Tax
OtherComprehensiveIncomeUnrealizedHoldingGainLossOnSecuritiesArisingDuringPeriodNetOfTax
26000 USD
CY2017Q2 us-gaap Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Net Of Tax
OtherComprehensiveIncomeUnrealizedHoldingGainLossOnSecuritiesArisingDuringPeriodNetOfTax
3000 USD
us-gaap Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Net Of Tax
OtherComprehensiveIncomeUnrealizedHoldingGainLossOnSecuritiesArisingDuringPeriodNetOfTax
-10000 USD
CY2016Q4 us-gaap Other Liabilities Noncurrent
OtherLiabilitiesNoncurrent
639000 USD
CY2017Q2 us-gaap Other Liabilities Noncurrent
OtherLiabilitiesNoncurrent
655000 USD
CY2016Q2 us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
-55000 USD
us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
-113000 USD
CY2017Q2 us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
-64000 USD
us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
-32000 USD
us-gaap Payments Of Debt Issuance Costs
PaymentsOfDebtIssuanceCosts
0 USD
us-gaap Payments Of Debt Issuance Costs
PaymentsOfDebtIssuanceCosts
125000 USD
us-gaap Payments To Acquire Short Term Investments
PaymentsToAcquireShortTermInvestments
88928000 USD
us-gaap Payments To Acquire Short Term Investments
PaymentsToAcquireShortTermInvestments
0 USD
CY2016Q4 us-gaap Preferred Stock Par Or Stated Value Per Share
PreferredStockParOrStatedValuePerShare
0.001
CY2017Q2 us-gaap Preferred Stock Par Or Stated Value Per Share
PreferredStockParOrStatedValuePerShare
0.001
CY2016Q4 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
5000000 shares
CY2017Q2 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
5000000 shares
CY2016Q4 us-gaap Preferred Stock Shares Issued
PreferredStockSharesIssued
0 shares
CY2017Q2 us-gaap Preferred Stock Shares Issued
PreferredStockSharesIssued
0 shares
CY2016Q4 us-gaap Preferred Stock Value
PreferredStockValue
0 USD
CY2017Q2 us-gaap Preferred Stock Value
PreferredStockValue
0 USD
CY2016Q4 us-gaap Prepaid Expense And Other Assets Current
PrepaidExpenseAndOtherAssetsCurrent
6337000 USD
CY2017Q2 us-gaap Prepaid Expense And Other Assets Current
PrepaidExpenseAndOtherAssetsCurrent
7011000 USD
us-gaap Proceeds From Convertible Debt
ProceedsFromConvertibleDebt
0 USD
us-gaap Proceeds From Convertible Debt
ProceedsFromConvertibleDebt
93500000 USD
us-gaap Proceeds From Maturities Prepayments And Calls Of Available For Sale Securities
ProceedsFromMaturitiesPrepaymentsAndCallsOfAvailableForSaleSecurities
49500000 USD
us-gaap Proceeds From Maturities Prepayments And Calls Of Available For Sale Securities
ProceedsFromMaturitiesPrepaymentsAndCallsOfAvailableForSaleSecurities
9983000 USD
us-gaap Proceeds From Stock Options Exercised
ProceedsFromStockOptionsExercised
14000 USD
us-gaap Proceeds From Stock Options Exercised
ProceedsFromStockOptionsExercised
5276000 USD
us-gaap Proceeds From Stock Plans
ProceedsFromStockPlans
470000 USD
us-gaap Proceeds From Stock Plans
ProceedsFromStockPlans
776000 USD
CY2016Q4 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
15238000 USD
CY2017Q2 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
14614000 USD
us-gaap Provision For Doubtful Accounts
ProvisionForDoubtfulAccounts
-139000 USD
us-gaap Provision For Doubtful Accounts
ProvisionForDoubtfulAccounts
0 USD
CY2017Q2 us-gaap Purchase Obligation
PurchaseObligation
24000000 USD
us-gaap Repayments Of Notes Payable
RepaymentsOfNotesPayable
91000 USD
us-gaap Repayments Of Notes Payable
RepaymentsOfNotesPayable
155000 USD
CY2016Q2 us-gaap Research And Development Expense Software Excluding Acquired In Process Cost
ResearchAndDevelopmentExpenseSoftwareExcludingAcquiredInProcessCost
13358000 USD
us-gaap Research And Development Expense Software Excluding Acquired In Process Cost
ResearchAndDevelopmentExpenseSoftwareExcludingAcquiredInProcessCost
26490000 USD
CY2017Q2 us-gaap Research And Development Expense Software Excluding Acquired In Process Cost
ResearchAndDevelopmentExpenseSoftwareExcludingAcquiredInProcessCost
14076000 USD
us-gaap Research And Development Expense Software Excluding Acquired In Process Cost
ResearchAndDevelopmentExpenseSoftwareExcludingAcquiredInProcessCost
28383000 USD
CY2016Q4 us-gaap Retained Earnings Accumulated Deficit
RetainedEarningsAccumulatedDeficit
-160259000 USD
CY2017Q2 us-gaap Retained Earnings Accumulated Deficit
RetainedEarningsAccumulatedDeficit
-199979000 USD
CY2016Q2 us-gaap Revenues
Revenues
37038000 USD
us-gaap Revenues
Revenues
74966000 USD
CY2017Q2 us-gaap Revenues
Revenues
40406000 USD
us-gaap Revenues
Revenues
80535000 USD
CY2016Q2 us-gaap Sales Revenue Services Net
SalesRevenueServicesNet
8663000 USD
us-gaap Sales Revenue Services Net
SalesRevenueServicesNet
18426000 USD
CY2017Q2 us-gaap Sales Revenue Services Net
SalesRevenueServicesNet
8750000 USD
us-gaap Sales Revenue Services Net
SalesRevenueServicesNet
16399000 USD
CY2016Q2 us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
16066000 USD
us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
34084000 USD
CY2017Q2 us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
17172000 USD
us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
33645000 USD
us-gaap Share Based Compensation
ShareBasedCompensation
11253000 USD
CY2017Q2 us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
0 shares
us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
0 shares
us-gaap Share Based Compensation
ShareBasedCompensation
12094000 USD
us-gaap Share Based Compensation Arrangement By Share Based Payment Award Discount From Market Price Offering Date
ShareBasedCompensationArrangementByShareBasedPaymentAwardDiscountFromMarketPriceOfferingDate
0.15
CY2017Q2 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options Grants In Period
ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsGrantsInPeriod
0 shares
CY2017Q2 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Maximum Employee Subscription Rate
ShareBasedCompensationArrangementByShareBasedPaymentAwardMaximumEmployeeSubscriptionRate
0.10
us-gaap Share Based Compensation Arrangement By Share Based Payment Award Number Of Additional Shares Authorized
ShareBasedCompensationArrangementByShareBasedPaymentAwardNumberOfAdditionalSharesAuthorized
900000 shares
CY2016Q4 us-gaap Short Term Investments
ShortTermInvestments
15996000 USD
CY2017Q2 us-gaap Short Term Investments
ShortTermInvestments
6000000 USD
us-gaap Stock Issued During Period Shares Employee Stock Purchase Plans
StockIssuedDuringPeriodSharesEmployeeStockPurchasePlans
50927 shares
CY2016Q4 us-gaap Stockholders Equity
StockholdersEquity
-3394000 USD
CY2017Q2 us-gaap Stockholders Equity
StockholdersEquity
-20463000 USD
CY2016Q2 us-gaap Subscription Revenue
SubscriptionRevenue
9143000 USD
us-gaap Subscription Revenue
SubscriptionRevenue
17344000 USD
CY2017Q2 us-gaap Subscription Revenue
SubscriptionRevenue
13434000 USD
us-gaap Subscription Revenue
SubscriptionRevenue
25648000 USD
us-gaap Tangible Asset Impairment Charges
TangibleAssetImpairmentCharges
0 USD
CY2016Q4 us-gaap Treasury Stock Shares
TreasuryStockShares
4417585 shares
CY2017Q2 us-gaap Treasury Stock Shares
TreasuryStockShares
4417585 shares
CY2016Q4 us-gaap Treasury Stock Value
TreasuryStockValue
13938000 USD
CY2017Q2 us-gaap Treasury Stock Value
TreasuryStockValue
13938000 USD
CY2017Q2 us-gaap Unamortized Debt Issuance Expense
UnamortizedDebtIssuanceExpense
181000 USD
CY2016Q2 us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
0 shares
us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
0 shares
CY2016Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
30330000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
30278000 shares
CY2017Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
31615000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
31357000 shares
CY2016Q2 us-gaap Weighted Average Number Of Share Outstanding Basic And Diluted
WeightedAverageNumberOfShareOutstandingBasicAndDiluted
30330000 shares
us-gaap Weighted Average Number Of Share Outstanding Basic And Diluted
WeightedAverageNumberOfShareOutstandingBasicAndDiluted
30278000 shares
CY2017Q2 us-gaap Weighted Average Number Of Share Outstanding Basic And Diluted
WeightedAverageNumberOfShareOutstandingBasicAndDiluted
31615000 shares
us-gaap Weighted Average Number Of Share Outstanding Basic And Diluted
WeightedAverageNumberOfShareOutstandingBasicAndDiluted
31357000 shares
CY2016Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
30330000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
30278000 shares
CY2017Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
31615000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
31357000 shares
us-gaap Nature Of Operations
NatureOfOperations
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Organization and Nature of Operations</font></div><div style="line-height:120%;text-align:justify;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;</font></div><div style="line-height:120%;text-align:justify;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">PROS Holdings, Inc., a Delaware corporation, through its operating subsidiaries (collectively, the "Company"), is a cloud software company powering the shift to modern commerce by helping companies create personalized and frictionless buying experiences for their customers. Fueled by dynamic pricing science and machine learning, PROS solutions make it possible for companies to price, configure and sell their products and services in an omnichannel environment with speed, precision and consistency. PROS customers, who are leaders in their markets, benefit from decades of data science expertise infused into its industry solutions. The Company provides its solutions to enterprises across the manufacturing, distribution, and services industries, including automotive and industrial, business-to-business ("B2B") services, cargo, chemicals and energy, consumer goods, insurance, food and beverage, healthcare, high tech, and travel. The Company offers its solutions via a SaaS delivery model as well as on a perpetual or term license basis. The Company also provides professional services to implement its software applications as well as business consulting. In addition, the Company provides product maintenance and support to its customers through which they receive unspecified upgrades, maintenance releases and bug fixes during the term of the support period on a when-and-if-available basis.</font></div></div>
us-gaap Use Of Estimates
UseOfEstimates
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Use of estimates</font></div><div style="line-height:120%;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company makes estimates and assumptions in the preparation of its unaudited condensed consolidated financial statements, and its estimates and assumptions may affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. The complexity and judgment required in the Company's estimation process, as well as issues related to the assumptions, risks and uncertainties inherent in the application of the percentage-of-completion method of accounting, affect the amounts of revenue, expenses, unbilled receivables and deferred revenue. Estimates are also used for, but not limited to, receivables, allowance for doubtful accounts, useful lives of assets, depreciation and amortization, income taxes and deferred tax asset valuation, valuation of stock options, other current liabilities and accrued liabilities. Numerous internal and external factors can affect estimates. The critical accounting policies related to the estimates and judgments are discussed in the Company's Annual Report under management's discussion and analysis of financial condition and results of operations. There have been no significant changes to the Company's critical accounting policies as described in the Company's Annual Report.</font></div></div>

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