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Stockholders' Equity | 3 Months Ended
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Mar. 31, 2025
Stockholders' Equity |
Stockholders' Equity | Note 10. Stockholders' Equity Share Repurchase Program On November 4, 2024, we announced that our board of directors authorized a program to repurchase shares of our common stock in the open market or in privately negotiated purchases, or both, in an aggregate amount not to exceed $30.0 million. The share repurchase program became effective on October 30, 2024 and expires on October 31, 2026. Upon purchase of the shares, we reduce our common stock for the par value of the shares with the excess cost applied against additional paid-in capital. We made repurchases under the share repurchase program in the following periods, which include the market price of the shares, commissions and excise tax: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | Three Months Ended
​ | ​ | ​ | March 31,
(In thousands, except share and per share data) | ​ | ​ | 2025 | ​ | ​ | 2024
Number of shares repurchased | ​ | ​ | 635,603 | ​ | ​ | —
Total share repurchased cost | ​ | $ | 10,068 | ​ | $ | —
Average total cost per repurchased share | ​ | $ | 15.76 | ​ | $ | —
​ As of March 31, 2025, approximately $16.5 million of authorized share repurchases were remaining under the share repurchase program. The timing and amount of future repurchases will be determined based on an evaluation of market conditions and other factors. Repurchases will be funded through available cash balances and ongoing business operating cash generation and may be suspended or discontinued at any time. Shares of stock repurchased under the program are immediately retired. Repurchases under our share repurchase program reduce the weighted-average number of shares of common stock outstanding for basic and diluted earnings per share calculations. Stock-Based Compensation Our 2016 Equity Incentive Plan (the “2016 Plan”) authorizes us to grant stock options, stock appreciation rights, restricted stock, stock units and other stock-based awards to employees, non-employee directors and certain consultants and advisors. There were up to 4,800,000 shares of our common stock initially reserved for issuance pursuant to the 2016 Plan. The 2016 Plan provides that the number of shares reserved and available for issuance under the 2016 Plan will automatically increase annually on January 1 of each calendar year, commencing in 2017 and ending on and including January 1, 2026, by an amount equal to the lesser of: (a) 5% of the number of common shares of stock outstanding as of December 31 of the immediately preceding calendar year, or (b) 2,500,000 shares; provided, however, that our Board of Directors may determine that any annual increase be a lesser number. In addition, all awards granted under our 2007 Omnibus Stock Plan and our 2003 Stock Option Plan that were outstanding when the 2016 Plan became effective and that are forfeited, expired, cancelled, settled for cash or otherwise not issued, will become available for issuance under the 2016 Plan. Pursuant to the automatic increase feature of the 2016 Plan, 1,180,019 shares were added as available for issuance thereunder on January 1, 2024. Our Board of Directors exercised its prerogative to forego the automatic increase on January 1, 2025. As of March 31, 2025, 5,966,176 shares were available for future grant pursuant to the 2016 Plan. On March 25, 2025, our Board of Directors approved, on the recommendation of the Compensation and Organization Committee, the Tactile Systems Technology, Inc. 2025 Equity Incentive Plan (the “2025 Plan”), subject to stockholder approval at the 2025 annual meeting of stockholders, which is scheduled for May 7, 2025. If approved by our stockholders, 1,850,000 shares of our common stock will be reserved for issuance under the 2025 Plan, plus the number of shares subject to any awards under the 2016 Plan that are outstanding on the date our stockholders approve the 2025 Plan, that later expires, is cancelled or forfeited, is settled for cash or otherwise does not result in the issuance of all of the shares subject to such award. If our stockholders approve the 2025 Plan, no additional grants will be made under 2016 Plan. Upon adoption and approval of the 2016 Plan, all of our previous equity incentive compensation plans were terminated. However, existing awards under those plans continue to vest in accordance with the original vesting schedules and will expire at the end of their original terms. We recorded stock-based compensation expense of $2.1 million and $2.0 million for the three months ended March 31, 2025 and 2024, respectively. This expense was allocated as follows: ​
​ | ​ | ​ | ​ | ​ | ​
​ | Three Months Ended
​ | March 31,
(In thousands) | 2025 |  | 2024
Cost of revenue | $ | 99 | ​ | $ | 83
Sales and marketing expenses | ​ | 503 | ​ | ​ | 738
Research and development expenses | ​ | 33 | ​ | ​ | 33
Reimbursement, general and administrative expenses | ​ | 1,431 | ​ | ​ | 1,185
Total stock-based compensation expense | $ | 2,066 | ​ | $ | 2,039
​ Stock Options Stock options issued to participants other than non-employees typically vest over three or four years and typically have a contractual term of seven or ten years. Stock-based compensation expense included in the Condensed Consolidated Statements of Operations for stock options was $0.0 million and $0.1 million for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, there was approximately $20,358 of total unrecognized pre-tax stock option expense under our equity compensation plans, which is expected to be recognized on a straight-line basis over a weighted-average period of 0.6 years. Our stock option activity for the three months ended March 31, 2025, was as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ | ​ | Weighted- | ​ | Weighted- | ​ | ​ | ​
​ | ​ | ​ | ​ | Average | ​ | Average | ​ | Aggregate
​ | ​ | Options | ​ | Exercise Price | ​ | Remaining | ​ | Intrinsic
(In thousands except options and per share data) | ​ | Outstanding | ​ | Per Share | ​ | Contractual Life | ​ | Value (1)
Balance at December 31, 2024 | ​ | 394,871 | ​ | $ | 40.70 | ​ | 2.8 years | ​ | $ | 309
Exercised | ​ | (2,364) | ​ | $ | 4.23 | ​ | ​ | ​ | $ | 22
Cancelled/Expired | ​ | (18,109) | ​ | $ | 43.75 | ​ | ​ | ​ | ​ | ​
Balance at March 31, 2025 | ​ | 374,398 | ​ | $ | 40.78 | ​ | 2.6 years | ​ | $ | 149
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Options exercisable at March 31, 2025 | ​ | 366,517 | ​ | $ | 41.49 | ​ | 2.6 years | ​ | $ | 108
​
(1) | The aggregate intrinsic value of options exercised represents the difference between the exercise price of the option and the closing stock price of our common stock on the date of exercise. The aggregate intrinsic value of options outstanding represents the difference between the exercise price of the option and the closing stock price of our common stock on the last trading day of the period.
Options exercisable of 395,952 as of March 31, 2024, had a weighted-average exercise price of $41.94 per share. Time-Based Restricted Stock Units We have granted time-based restricted stock units to certain participants under the 2016 Plan that are stock-settled with common shares. Time-based restricted stock units granted under the 2016 Plan vest over one to three years. Stock-based compensation expense included in the Condensed Consolidated Statements of Operations for time-based restricted stock units was $1.5 million and $1.4 million for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, there was approximately $9.5 million of total unrecognized pre-tax compensation expense related to outstanding time-based restricted stock units that is expected to be recognized over a weighted-average period of 2.3 years. Our time-based restricted stock unit activity for the three months ended March 31, 2025, was as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Weighted- | ​ | ​ | ​
​ |  | ​ |  | Average Grant |  | Aggregate
​ | ​ | Units | ​ | Date Fair Value | ​ | Intrinsic
(In thousands except unit and per unit data) | ​ | Outstanding | ​ | Per Unit | ​ | Value (1)
Balance at December 31, 2024 | ​ | 728,426 | ​ | $ | 14.33 | ​ | $ | 12,478
Granted | ​ | 342,779 | ​ | $ | 15.17 | ​ | ​ | ​
Vested | ​ | (233,509) | ​ | $ | 14.80 | ​ | ​ | ​
Cancelled | ​ | (26,193) | ​ | $ | 15.48 | ​ | ​ | ​
Balance at March 31, 2025 | ​ | 811,503 | ​ | $ | 14.52 | ​ | $ | 10,728
​
(1) | The aggregate intrinsic value of restricted stock units outstanding was based on our closing stock price on the last trading day of the period.
Performance-Based Restricted Stock Units We have granted performance-based restricted stock units (“PSUs”) to certain participants under the 2016 Plan. These PSUs have both performance-based and time-based vesting features. The PSUs granted in 2024 have three separate performance periods, and one-third of each grant will be earned if and to the extent performance goals based on revenue change and adjusted EBITDA margin are achieved in each of 2024 and 2025 (ranging from 25% to 175% of target), and one-third will be earned if and to the extent performance goals based on revenue change and adjusted EBITDA change are achieved in 2026 (ranging from 25% to 175% of target). The PSUs granted in 2025 have three separate performance periods, and one-third of each grant will be earned if and to the extent performance goals based on revenue and adjusted EBITDA margin are achieved in 2025 (ranging from 25% to 175% of target), one-third will be earned if and to the extent performance goals based on revenue change and adjusted EBITDA change are achieved in 2026 (ranging from 25% to 175% of target), and one-third will be earned if and to the extent performance goals based on revenue change and adjusted EBITDA change are achieved in 2027 (ranging from 25% to 175% of target). All earned and vested PSUs will be settled in shares of common stock. Stock-based compensation expense recognized for PSUs was $0.4 million for each of the three months ended March 31, 2025 and 2024. As of March 31, 2025, there was approximately $3.4 million of total unrecognized pre-tax compensation expense related to outstanding PSUs that is expected to be recognized over a weighted average period of 2.6 years. Our PSU activity for the three months ended March 31, 2025, was as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Weighted- | ​ | ​ | ​
​ |  | ​ |  | Average Grant |  | Aggregate
​ | ​ | PSUs | ​ | Date Fair Value | ​ | Intrinsic
(In thousands except unit and per unit data) | ​ | Outstanding | ​ | Per Unit | ​ | Value (1)
Balance at December 31, 2024 | ​ | 272,919 | ​ | $ | 15.19 | ​ | $ | 4,675
Granted | ​ | 168,722 | ​ | $ | 15.38 | ​ | ​ | ​
Vested | ​ | (120,436) | ​ | $ | 16.67 | ​ | ​ | ​
Cancelled | ​ | (9,033) | ​ | $ | 13.77 | ​ | ​ | ​
Balance at March 31, 2025 | ​ | 312,172 | ​ | $ | 14.75 | ​ | $ | 4,127
​
(1) | The aggregate intrinsic value of PSUs outstanding was based on our closing stock price on the last trading day of the period.
Employee Stock Purchase Plan Our employee stock purchase plan (“ESPP”), which was approved by our Board of Directors on April 27, 2016, and by our stockholders on June 20, 2016, allows participating employees to purchase shares of our common stock at a discount through payroll deductions. The ESPP is available to all of our employees and employees of participating subsidiaries. Participating employees may purchase common stock, on a voluntary after-tax basis, at a price equal to 85% of the lower of the closing market price per share of our common stock on the first or last trading day of each stock purchase period. The ESPP provides for six-month purchase periods, beginning on May 16 and November 16 of each calendar year. A total of 1,600,000 shares of common stock was initially reserved for issuance under the ESPP. This share reserve will automatically be supplemented each January 1, commencing in 2017 and ending on and including January 1, 2026, by an amount equal to the least of (a) 1% of the shares of our common stock outstanding on the immediately preceding December 31, (b) 500,000 shares or (c) such lesser amount as our Board of Directors may determine. Pursuant to the automatic increase feature of the ESPP, 240,780 shares were added as available for issuance thereunder on January 1, 2025 and 236,003 shares were added as available for issuance thereunder on January 1, 2024. As of March 31, 2025, 1,685,685 shares were available for future issuance under the ESPP. We recognized stock-based compensation expense associated with the ESPP of $0.2 million and $0.1 million for the three months ended March 31, 2025 and 2024, respectively. ​

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