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Balance Sheet Components | 6 Months Ended
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Apr. 02, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Balance Sheet Components | 5. Balance Sheet Components Accounts receivable, net of allowances Accounts receivable, net of allowances, consist of the following:
|  | April 2, 2022 |  |  | October 2, 2021 |
(In thousands) |  |  |  |  |  |
Accounts receivable |  | $ | 128,989 |  |  | $ | 121,486 |
Allowance for credit losses |  |  | (1,913 | ) |  |  | (1,547 | )
Allowance for sales incentives |  |  | (15,688 | ) |  |  | (19,160 | )
Accounts receivable, net of allowances |  | $ | 111,388 |  |  | $ | 100,779 |
Inventories Inventories, net, consist of the following:
|  | April 2, 2022 |  |  | October 2, 2021 |
(In thousands) |  |  |  |  |  |
Finished goods |  | $ | 208,476 |  |  | $ | 154,608 |
Component parts |  |  | 55,929 |  |  |  | 30,522 |
Inventories |  | $ | 264,405 |  |  | $ | 185,130 |
The Company writes down inventory as a result of excess and obsolete inventories, or when it believes that the net realizable value of inventories is less than the carrying value. Goodwill The following table presents the changes in carrying amount of goodwill during the six months ended April 2, 2022:
(In thousands) |  |  |
Balance as of October 2, 2021 |  | $ | 15,545 |
Goodwill acquired |  |  | 22,181 |
Balance as of April 2, 2022 |  | $ | 37,726 |
Intangible assets The following table reflects the changes in the net carrying amount of the components of intangible assets associated with the Company's acquisition activity:
|  | April 2, 2022 |
|  | Gross Carrying Amount |  |  | Accumulated Amortization |  |  | Net Carrying Value |  |  | Weighted-Average Remaining Life |
(In thousands, except weighted-average remaining life) |  |  |  |  |  |  |  |  |  |  |  |
Technology |  | $ | 13,931 |  |  | $ | (5,143 | ) |  | $ | 8,788 |  |  |  | 2.63 |
Total finite-lived intangible assets |  |  | 13,931 |  |  |  | (5,143 | ) |  |  | 8,788 |  |  |  | 2.63 |
In-process research and development not subject to amortization |  |  | 20,100 |  |  |  | — |  |  |  | 20,100 |  |  |  |
Total intangible assets |  | $ | 34,031 |  |  | $ | (5,143 | ) |  | $ | 28,888 |  |  |  |
The following table summarizes the estimated future amortization expense of the Company's intangible assets as of April 2, 2022:
Fiscal years ending |  | Future Amortization Expense |
(In thousands) |  |  |
Remainder of fiscal 2022 |  | $ | 1,931 |
2023 |  |  | 3,237 |
2024 |  |  | 3,024 |
2025 |  |  | 423 |
2026 |  |  | 94 |
2027 and there after |  |  | 79 |
Total future amortization expense |  | $ | 8,788 |
Cloud Computing Arrangements Beginning in fiscal 2020, and continuing through fiscal 2021, the Company began activities to replace its legacy enterprise resource management system in order to accommodate the Company's expanding operations. Capitalized costs were $22.6 million and $14.3 million as of April 2, 2022, and October 2, 2021, respectively, and are reported as a component of other assets on the Company's condensed consolidated balance sheets. Accrued expenses Accrued expenses consisted of the following:
|  | April 2, 2022 |  |  | October 2, 2021 |
(In thousands) |  |  |  |  |  |
Accrued advertising and marketing |  | $ | 13,751 |  |  | $ | 19,989 |
Accrued taxes |  |  | 13,710 |  |  |  | 16,941 |
Accrued inventory |  |  | 25,971 |  |  |  | 37,117 |
Accrued manufacturing, logistics and product development |  |  | 17,647 |  |  |  | 14,943 |
Accrued general and administrative expenses |  |  | 20,010 |  |  |  | 13,066 |
Other accrued payables |  |  | 9,255 |  |  |  | 5,973 |
Total accrued expenses |  | $ | 100,344 |  |  | $ | 108,029 |
Deferred revenue Amounts invoiced in advance of revenue recognition are recorded as deferred revenue on the condensed consolidated balance sheets. Deferred revenue primarily related to revenue allocated to unspecified software upgrades and cloud-based services. Recognition of revenue includes $18.8 million of deferred revenue from the fourth quarter of fiscal 2021 related to newly launched products sold to resellers not recognized as revenue until the date of general availability was reached, which was in the first quarter of fiscal 2022. The following table presents the changes in the Company’s deferred revenue for the six months ended April 2, 2022, and April 3, 2021:
|  | April 2, 2022 |  |  | April 3, 2021 |
(In thousands) |  |  |  |  |  |
Deferred revenue, beginning of period |  | $ | 89,498 |  |  | $ | 62,389 |
Recognition of revenue included in beginning of period deferred revenue |  |  | (28,927 | ) |  |  | (7,883 | )
Revenue deferred, net of revenue recognized on contracts in the respective period |  |  | 16,063 |  |  |  | 16,383 |
Deferred revenue, end of period |  | $ | 76,634 |  |  | $ | 70,889 |
The Company expects the following recognition of deferred revenue as of April 2, 2022:
|  | For the fiscal years ending |  |  |  |
|  | 2022 |  |  | 2023 |  |  | 2024 |  |  | 2025 |  |  | 2026 and Beyond |  |  | Total |
(In thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Deferred revenue expected to be recognized |  | $ | 9,750 |  |  | $ | 16,859 |  |  | $ | 14,809 |  |  | $ | 12,498 |  |  | $ | 22,718 |  |  | $ | 76,634 |
Other current liabilities Other current liabilities consist of the following:
|  | April 2, 2022 |  |  | October 2, 2021 |
(In thousands) |  |  |  |  |  |
Reserve for returns |  | $ | 18,839 |  |  | $ | 19,266 |
Short-term operating lease liabilities |  |  | 9,923 |  |  |  | 10,724 |
Product warranty liability |  |  | 8,756 |  |  |  | 5,604 |
Other |  |  | 4,066 |  |  |  | 3,950 |
Total other current liabilities |  | $ | 41,584 |  |  | $ | 39,544 |
The following table presents the changes in the Company’s warranty liability for the six months ended April 2, 2022, and April 3, 2021:
|  | April 2, 2022 |  |  | April 3, 2021 |
(In thousands) |  |  |  |  |  |
Warranty liability, beginning of period |  | $ | 5,604 |  |  | $ | 3,628 |
Provision for warranties issued during the period |  |  | 7,082 |  |  |  | 8,844 |
Settlements of warranty claims during the period |  |  | (3,930 | ) |  |  | (7,616 | )
Warranty liability, end of period |  | $ | 8,756 |  |  | $ | 4,856 |

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