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Shutterfly Inc – ‘10-Q’ for 9/30/12 – ‘R8’

On:  Tuesday, 11/6/12, at 4:17pm ET   ·   For:  9/30/12   ·   Accession #:  1125920-12-15   ·   File #:  1-33031

Previous ‘10-Q’:  ‘10-Q’ on 7/31/12 for 6/30/12   ·   Next:  ‘10-Q’ on 5/7/13 for 3/31/13   ·   Latest:  ‘10-Q’ on 8/7/19 for 6/30/19

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  As Of               Filer                 Filing    For·On·As Docs:Size

11/06/12  Shutterfly Inc                    10-Q        9/30/12   41:4.5M

Quarterly Report   —   Form 10-Q   —   Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Shutterfly Inc 10-Q 9-30-2012                       HTML    518K 
 2: EX-10.02    Material Contract                                   HTML     36K 
 3: EX-31.01    Certification -- §302 - SOA'02                      HTML     21K 
 4: EX-31.02    Certification -- §302 - SOA'02                      HTML     21K 
 5: EX-32.01    Certification -- §906 - SOA'02                      HTML     17K 
 6: EX-32.02    Certification -- §906 - SOA'02                      HTML     17K 
24: R1          Document and Entity Information                     HTML     40K 
17: R2          Condensed Consolidated Balance Sheet (Unaudited)    HTML    112K 
22: R3          Condensed Consolidated Balance Sheet (Unaudited)    HTML     26K 
                (Parenthetical)                                                  
26: R4          Condensed Consolidated Statement of Income          HTML     61K 
                (Unaudited)                                                      
38: R5          Condensed Consolidated Statement of Income          HTML     23K 
                (Unaudited) (Parenthetical)                                      
18: R6          Condensed Consolidated Statement of Cash Flows      HTML    130K 
                (Unaudited)                                                      
21: R7          The Company and Summary of Significant Accounting   HTML     34K 
                Policies                                                         
16: R8          Stock-Based Compensation                            HTML    113K 
14: R9          Net Loss Per Share                                  HTML     49K 
39: R10         Balance Sheet Components                            HTML     59K 
28: R11         Commitments and Contingencies                       HTML     32K 
27: R12         Acquisitions                                        HTML     37K 
32: R13         Subsequent Event                                    HTML     17K 
33: R14         The Company and Summary of Significant Accounting   HTML     49K 
                Policies (Policies)                                              
31: R15         Stock-Based Compensation (Tables)                   HTML    104K 
34: R16         Net Loss Per Share (Tables)                         HTML     48K 
23: R17         Balance Sheet Components (Tables)                   HTML     62K 
25: R18         The Company and Summary of Significant Accounting   HTML     34K 
                Policies (Details)                                               
30: R19         Stock-Based Compensation (Details)                  HTML    172K 
41: R20         Net Loss Per Share (Details)                        HTML     33K 
36: R21         Balance Sheet Components (Prepaid Expenses and      HTML     34K 
                Other Current Assets) (Details)                                  
19: R22         Balance Sheet Components (Property and Equipment)   HTML     36K 
                (Details)                                                        
29: R23         Balance Sheet Components (Accrued Liabilities)      HTML     35K 
                (Details)                                                        
20: R24         Commitments and Contingencies (Details)             HTML     22K 
13: R25         Acquisitions (Details)                              HTML     67K 
37: R26         Subsequent Event (Details)                          HTML     15K 
40: XML         IDEA XML File -- Filing Summary                      XML     55K 
15: EXCEL       IDEA Workbook of Financial Reports (.xls)            XLS    543K 
 7: EX-101.INS  XBRL Instance -- sfly-20120930                       XML    845K 
 9: EX-101.CAL  XBRL Calculations -- sfly-20120930_cal               XML    118K 
10: EX-101.DEF  XBRL Definitions -- sfly-20120930_def                XML    215K 
11: EX-101.LAB  XBRL Labels -- sfly-20120930_lab                     XML    849K 
12: EX-101.PRE  XBRL Presentations -- sfly-20120930_pre              XML    426K 
 8: EX-101.SCH  XBRL Schema -- sfly-20120930                         XSD     74K 
35: ZIP         XBRL Zipped Folder -- 0001125920-12-000015-xbrl      Zip    105K

‘R8’   —   Stock-Based Compensation

This is an IDEA Financial Report.  [ Alternative Formats ]

 
v2.4.0.6
Stock-Based Compensation
 9 Months Ended
Share-based Compensation [Abstract]  
Stock-Based Compensation
Stock-Based Compensation

Stock Option Activity

A summary of the Company’s stock option activity for the three and nine months ended September 30, 2012 is as follows (share numbers and aggregate intrinsic values in thousands):
 
 
Number of
Options
Outstanding
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Contractual
Term (Years)
 
Aggregate
Intrinsic
Value
2,768

 
$
15.71

 
 
 
 
Granted
43

 
27.00

 
 
 
 
Exercised
(190
)
 
17.63

 
 
 
 
Forfeited, cancelled or expired
(23
)
 
20.38

 
 
 
 
Balances, March 31, 2012
2,598

 
$
15.71

 
6.1
 
$
43,498

Granted
19

 
27.81

 
 
 
 
Exercised
(177
)
 
21.35

 
 
 
 
Forfeited, cancelled or expired
(37
)
 
24.68

 
 
 
 
Balances, June 30, 2012
2,403

 
$
15.26

 
6.1
 
$
39,909

Granted
37

 
31.58

 
 
 
 

Exercised
(147
)
 
9.65

 
 
 
 

Forfeited, cancelled or expired
(22
)
 
25.79

 
 
 
 
2,271

 
$
15.78

 
5.1
 
$
36,597

Options vested and expected to vest at September 30, 2012
2,234

 
$
15.55

 
5.1
 
$
36,372

Options vested at September 30, 2012
1,894

 
$
13.36

 
4.5
 
$
33,725


 
During the three months ended September 30, 2012, the Company granted options to purchase an aggregate of 37,000 shares of common stock with an estimated weighted-average grant-date fair value of $13.99 per share. The total intrinsic value of options exercised during the three months ended September 30, 2012, was $3,188,000.  Net cash proceeds from the exercise of stock options were $1,422,000 for the three months ended September 30, 2012.

Valuation of Stock Options

The Company estimated the fair value of each option award on the date of grant using the Black-Scholes option-pricing model and the assumptions noted in the following table.  In the three and nine months ended September 30, 2012 and 2011, the Company calculated volatility using an average of its historical and implied volatilities. The expected term of options gave consideration to historical exercises, post-vesting cancellations and the options’ contractual term. The risk-free rate for the expected term of the option is based on the U.S. Treasury Constant Maturity at the time of grant. The assumptions used to value options granted during the three and nine months ended September 30, 2012 and 2011 were as follows:
 
 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
 
2012
 
2011
 
2012
 
2011
Dividend yield
—

 
—

 
—

 
—

Annual risk free rate of return
0.7
%
 
1.1
%
 
0.8
%
 
1.7
%
Expected volatility
55.6
%
 
54.7
%
 
57.9
%
 
51.5
%
Expected term (years)
4.3

 
4.3

 
4.3

 
4.4



Employee stock-based compensation expense recognized in the three and nine months ended September 30, 2012 and 2011, was calculated based on awards ultimately expected to vest and has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

Restricted Stock Units

The Company grants restricted stock units (“RSUs”) to its employees under the provisions of the 2006 Equity Incentive Plan. The cost of RSUs is determined using the fair value of the Company’s common stock on the date of grant.  RSUs typically vest and are settled annually, based on a three or four year total vesting term.  Compensation cost is amortized on a straight-line basis over the requisite service period.

Restricted Stock Unit Activity

A summary of the Company’s restricted stock unit activity for the three and nine months ended September 30, 2012, is as follows (share numbers in thousands):
 
 
Number of
Units
Outstanding
 
Weighted
Average
Grant Date
Fair Value
Awarded and unvested, December 31, 2011
1,969

 
$
31.33

Granted
1,395

 
27.60

Vested
(609
)
 
21.13

Forfeited
(72
)
 
34.80

Awarded and unvested, March 31, 2012
2,683

 
$
31.61

Granted
370

 
26.67

Vested
(144
)
 
22.06

Forfeited
(81
)
 
37.63

Awarded and unvested, June 30, 2012
2,828

 
$
31.28

Granted
553

 
32.16

Vested
(52
)
 
34.17

Forfeited
(192
)
 
31.15

Awarded and unvested, September 30, 2012
3,137

 
$
31.40

Restricted stock units expected to vest, September 30, 2012
2,768

 
 


 
Included in the restricted stock unit activity above, and in connection with the acquisition of Penguin Digital, Inc. ("Penguin Digital") on September 14, 2012, the Company granted 106,000 RSUs to certain employees of Penguin Digital. These awards vest annually over a three year period based on continued employment. The Company also granted 74,000 RSUs that have both performance and service vesting criteria ("PBRSU") which vest annually over a three year term contingent on achieving certain performance milestones and continued employment.

Also included in the RSU grants above for the nine months ended September 30, 2012, and in connection with the acquisition of Photoccino on May 25, 2012, the Company granted 146,000 RSUs to certain employees of Photoccino. These awards vest annually over a three year period based on continued employment.
 
An additional 445,000 PBRSUs are included in the RSU grants for the nine months ended September 30, 2012.  The performance criteria for these PBRSUs are tied to the Company’s 2012 financial performance and the service criteria are consistent with vesting described in the Company's 2006 Equity Incentive Plan.  Compensation cost associated with these PBRSUs is recognized on an accelerated attribution model and ultimately based on whether or not satisfaction of the performance criteria is probable.  If in the future, situations indicate that the performance criteria are not probable, then no further compensation cost will be recorded and any previous costs will be reversed.

At September 30, 2012, the Company had $81,694,000 of total unrecognized compensation expense, net of estimated forfeitures, related to stock options and RSUs that will be recognized over a weighted-average period of approximately three years.

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘10-Q’ Filing    Date    Other Filings
Filed on:11/6/12
For Period end:9/30/12
9/14/12
6/30/1210-Q
5/25/124,  8-K
3/31/1210-Q
12/31/1110-K
9/30/1110-Q
9/15/09
 List all Filings 
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Filing Submission 0001125920-12-000015   –   Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)
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