0001628280-21-009412 | 10-Q | XBRL Viewer

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Cover Page - shares	3 Months Ended
Cover Page - shares	Mar. 31, 2021	Apr. 30, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2021
Document Transition Report	false
Entity File Number	001-38334
Entity Registrant Name	IMMERSION CORP
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	94-3180138
Entity Address, Address Line One	330 Townsend Street, Suite 234
Entity Address, City or Town	San Francisco
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94107
City Area Code	408
Local Phone Number	467-1900
Title of 12(b) Security	Common Stock, $0.001 par value
Trading Symbol	IMMR
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		30,885,541
Amendment Flag	false
Entity Central Index Key	0001058811
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 102,624	$ 59,522
Accounts and other receivables	2,034	2,218
Prepaid expenses and other current assets	11,213	12,610
Total current assets	115,871	74,350
Property and equipment, net	254	209
Deposits Assets, Noncurrent	12,296	12,571
Other assets	7,987	9,000
Total assets	136,408	96,130
Current liabilities:
Accounts payable	469	149
Accrued compensation	933	1,001
Other current liabilities	2,718	2,457
Deferred revenue	5,098	5,173
Total current liabilities	9,218	8,780
Long-term deferred revenue	20,183	21,334
Other long-term liabilities	1,709	2,035
Total liabilities	31,110	32,149
Contingencies (Note 5)
Stockholders’ equity:
Common stock and additional paid-in capital — $0.001 par value; 100,000,000 shares authorized; 43,020,610 and 39,161,214 shares issued, respectively; 30,877,177 and 27,017,781 shares outstanding, respectively	298,037	258,756
Accumulated other comprehensive income	122	122
Accumulated deficit	(111,128)	(113,164)
Treasury stock at cost: 12,143,433 and 12,143,433 shares, respectively	(81,733)	(81,733)
Total stockholders’ equity	105,298	63,981
Total liabilities and stockholders’ equity	$ 136,408	$ 96,130

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	43,020,610	39,161,214
Common stock, shares outstanding (in shares)	30,877,177	27,017,781
Treasury stock, shares (in shares)	12,143,433	12,143,433

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenues:
Revenue	$ 7,159	$ 6,257
Costs and expenses:
Cost of revenues	29	44
Sales and marketing	1,106	1,716
Research and development	1,307	1,689
General and administrative	2,224	7,356
Total costs and expenses	4,666	10,805
Operating income (loss)	2,493	(4,548)
Interest and other income (loss), net	(316)	(228)
Income (loss) before provision for income taxes	2,177	(4,776)
Provision for income taxes	(141)	(52)
Net income (loss)	$ 2,036	$ (4,828)
Basic net loss per share (in dollars per share)	$ 0.07	$ (0.16)
Shares used in calculating basic net loss per share (in shares)	28,579	31,006
Diluted net loss per share (in dollars per share)	$ 0.07	$ (0.16)
Shares used in calculating diluted net loss per share (in shares)	29,180	31,006
Other comprehensive income (loss)
Change in unrealized gains (loss) on short-term investments	$ 0	$ (2)
Total other comprehensive income (loss)	0	(2)
Total comprehensive income (loss)	2,036	(4,830)
Royalty and license
Revenues:
Revenue	7,068	6,182
Development, services, and other
Revenues:
Revenue	$ 91	$ 75

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY - USD ($) $ in Thousands	Total	Common Stock and Additional Paid-In Capital	Accumulated Other Comprehensive Income	Accumulated Deficit	Treasury Stock
Beginning balance (in shares) at Dec. 31, 2019		38,624,784			7,210,456
Beginning balance at Dec. 31, 2019	$ 83,757	$ 253,289	$ 124	$ (118,565)	$ (51,091)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(4,828)			(4,828)
Unrealized gain on available-for-sale securities, net of taxes	(2)		(2)
Issuance of common stock for employee stock purchase (in shares)		10,162
Issuance of stock for ESPP purchases	$ 63	$ 63
Repurchased shares (in shares)	2,000,000.0				2,012,766
Repurchase of stock	$ (11,975)				$ (11,975)
Release of restricted stock units and awards (in shares)		189,735
Release of restricted stock units and awards	0
Stock-based compensation	729	$ 729
Ending balance (in shares) at Mar. 31, 2020		38,824,681			9,223,222
Ending balance at Mar. 31, 2020	67,744	$ 254,081	122	(123,393)	$ (63,066)
Beginning balance (in shares) at Dec. 31, 2020		39,161,214			12,143,433
Beginning balance at Dec. 31, 2020	63,981	$ 258,756	122	(113,164)	$ (81,733)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	2,036			2,036
Unrealized gain on available-for-sale securities, net of taxes	0
Issuance of common stock for employee stock purchase (in shares)		15,543
Issuance of stock for ESPP purchases	89	$ 89
Exercise of stock options, net of shares withheld for employee taxes (in shares)		306,987
Issuance of stock for ESPP purchases	2,724	$ 2,724
Release of restricted stock units and awards (in shares)		227,055
Release of restricted stock units and awards	0
Stock Issued During Period, Value, New Issues	35,937	$ 35,937
Stock Issued During Period, Shares, New Issues		3,309,811
Stock-based compensation	531	$ 531
Ending balance (in shares) at Mar. 31, 2021		43,020,610			12,143,433
Ending balance at Mar. 31, 2021	$ 105,298	$ 298,037	$ 122	$ (111,128)	$ (81,733)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Cash flows provided by (used in) operating activities:
Net income (loss)	$ 2,036	$ (4,828)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	192	1,178
Stock-based compensation	531	729
Foreign Currency Remeasurement Gain (Loss)	280	361
Other	24	34
Changes in operating assets and liabilities:
Accounts and other receivables	184	(2,202)
Prepaid expenses and other current assets	1,396	4,820
Increase (Decrease) in Deposit Assets	0	(361)
Other assets	843	339
Accounts payable	305	122
Accrued compensation	(68)	(855)
Other current liabilities	280	422
Deferred revenue	(1,226)	(1,302)
Other long-term liabilities	(367)	227
Net cash provided by (used in) operating activities	4,410	(1,316)
Cash flows provided by (used in) investing activities:
Proceeds from maturities of short-term investments	0	3,000
Purchases of property and equipment	(57)	(21)
Net cash provided by (used in) investing activities	(57)	2,979
Cash flows provided by (used in) financing activities:
Proceeds from issuance of common stock, net	35,937	0
Cash paid for purchases of treasury shares	0	(11,975)
Proceeds from issuance of common stock under employee stock purchase plan	89	63
Proceeds from stock options exercises	2,723	0
Net cash provided by (used in) financing activities	38,749	(11,912)
Net increase (decrease) in cash and cash equivalents	43,102	(10,249)
Cash and cash equivalents:
Beginning of period	59,522	86,478
End of period	102,624	76,229
Supplemental disclosure of cash flow information:
Cash paid for income taxes	13	19
Supplemental disclosure of non-cash operating, investing, and financing activities:
Release of restricted stock units and awards under company stock plan	2,367	1,356
Leased assets obtained in exchange for new operating lease liabilities	$ 0	$ 577

SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
SIGNIFICANT ACCOUNTING POLICIES	Mar. 31, 2021
Accounting Policies [Abstract]
SIGNIFICANT ACCOUNTING POLICIES	SIGNIFICANT ACCOUNTING POLICIES Description of Business Immersion Corporation (the "Company", "Immersion", "we" or "us") was incorporated in 1993 in California and reincorporated in Delaware in 1999. We focus on the creation, design, development, and licensing of innovative haptic technologies that allow people to use their sense of touch more fully as they engage with products and experience the digital world around them. We have adopted a business model under which it provides advanced tactile software, related tools, technical assistance designed to help integrate our patented technology into our customers’ products or enhance the functionality of our patented technology to certain customers, and offers licenses to our patented technology to other customers. Impact of COVID-19 In March 2020, the World Health Organization declared the outbreak of COVID-19 a pandemic, which continues to spread throughout the U.S. and the world and has resulted in authorities implementing numerous measures to combat the spread of the virus, including travel bans and restrictions, quarantines, shelter-in-place orders, and business limitations and shutdowns. The COVID-19 outbreak and related public health measures have adversely affected workforce, organizations, consumers, economies, and financial markets globally, leading to an economic downturn and increased market volatility. Our compliance with these containment measures has impacted our day-to-day operations and could disrupt our business and operations, as well as that of our customers and suppliers for an extended period of time. To support the health and well-being of our employees, customers and communities, we implemented work-from-home and restricted travel policies in the first quarter of 2020, which are expected to remain in place for the first half of 2021 and beyond. In addition, many of our customers are working remotely, which may delay the timing of some orders due to their and our compliance with frequently changing government-mandated or recommended shelter-in-place orders in jurisdictions in which we, our customers and our suppliers operate. In response to certain anticipated impacts from the COVID-19 pandemic, we implemented a series of cost reduction initiatives in the first half of 2020 to further preserve financial flexibility. These actions include: reductions of the base salaries and cash compensation of company executives and board members; cancellation and reduction in the 2020 executive and employee bonus plans; renegotiated professional services fees from third-party services providers; relocation of certain positions to lower-cost regions; temporarily suspended company matching of our employee retirement savings plan and taking advantage of the broad-based employer relief provided by the governments. In April 2020, the Government of Canada announced the Canada Emergency Wage Subsidy (“CEWS”) for Canadian employers whose businesses were affected by the COVID-19 pandemic. The CEWS provides a subsidy of up to 75% of eligible employees’ employment insurable remuneration, subject to certain criteria. We applied for the CEWS to the extent we met the requirements to receive the subsidy. During the three months ended March 31, 2021, we recorded $0.1 million in government subsidies as a reduction to operating expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Principles of Consolidation and Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of Immersion Corporation and our wholly-owned subsidiaries. All intercompany accounts, transactions, and balances have been eliminated in consolidation. The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, these condensed consolidated financial statements do not include all information and footnotes necessary for a complete presentation of the financial position, results of operations, and cash flows, in conformity with U.S. GAAP and should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020. In the opinion of management, all adjustments consisting of only normal and recurring items necessary for the fair presentation of the financial position and results of operations for the interim periods presented have been included. Use of Estimates The preparation of condensed consolidated financial statements and related disclosures requires management to make estimates and assumptions that affect the reported amounts of the condensed consolidated financial statements. Significant estimates include revenue recognition, useful lives of property and equipment, valuation of income taxes including uncertain tax provisions, stock-based compensation and income taxes. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the full year. Segment Information We develop, license, and support a wide range of software and IP that more fully engage users’ senses of touch when operating digital devices. We focus on the following target application areas: mobile devices, wearables, consumer, mobile entertainment and other content; console gaming; automotive; medical; and commercial. We manage these application areas in one operating and reporting segment with only one set of management, development, and administrative personnel. Our chief operating decision maker (“CODM”) is the Chief Executive Officer. The CODM approves budgets and allocates resources to and assesses the performance of our business using information about our revenue and operating loss. There is only one segment that is reported to management. Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standard Board (the "FASB") issued Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which enhances and simplifies various aspects of the income tax accounting guidance, including requirements such as tax basis step-up in goodwill obtained in a transaction that is not a business combination, ownership changes in investments, and interim-period accounting for enacted changes in tax law. The amendment is effective for public companies with fiscal years beginning after December 15, 2020; early adoption is permitted. We adopted this new guidance in the first quarter of 2021. This adoption did not have material impact on our condensed consolidated financial statements.

REVENUE RECOGNITION

3 Months Ended

Mar. 31, 2021

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

Disaggregated Revenue

The following table presents the disaggregation of our revenue for the three months ended March 31, 2021 and 2020 (in thousands).


	Three Months Ended March 31,
	2021		2020
Fixed fee license revenue	$	1,275	$	1,287
Per-unit royalty revenue	5,793		4,895
Total royalty and license revenue	7,068		6,182
Development, services, and other revenue	91		75
Total revenue	$	7,159	$	6,257

Per-unit Royalty Revenue

We record per-unit royalty revenue in the same period in which the licensee’s underlying sales occur. As we generally do not receive the per-unit licensee royalty reports for sales during a given quarter within the time frame that allows us to adequately review the reports and include the actual amounts in our quarterly results for such quarter, we accrue the related revenue based on estimates of our licensees’ underlying sales, subject to certain constraints on our ability to estimate such amounts. We develop such estimates based on a combination of available data including, but not limited to, approved customer forecasts, a look back at historical royalty reporting for each of our customers, and industry information available for the licensed products.

As a result of accruing per-unit royalty revenue for the quarter based on such estimates, adjustments will be required in the following quarter to true up revenue to the actual amounts reported by its licensees. We recorded $0.5 million and

$0.1 million adjustments to decrease royalty revenue during the three months ended March 31, 2021 and 2020, respectively.

Contract Assets

As of March 31, 2021, we had contract assets of $10.2 million included within Prepaid expenses and other current assets, and $3.8 million included within Other assets on the Condensed Consolidated Balance Sheets. As of December 31, 2020, we had contract assets of $11.6 million included within Prepaid expenses and other current assets, and $4.6 million included within Other assets, on the Condensed Consolidated Balance Sheets.

Contract assets decreased by $2.3 million from December 31, 2020 to March 31, 2021, primarily due to actual royalties billed during the three months ended March 31, 2021.

Contract Revenue

We recognize revenue from a fixed fee license agreement when we have satisfied our performance obligations, which typically occurs upon the transfer of rights to our technology upon the execution of the license agreement. However, in certain contracts, we grant a license to our existing patent portfolio at the inception of the license agreement as well as rights to the portfolio as it evolves throughout the contract term. For such arrangements, we have concluded that there are two separate performance obligations:

• Performance Obligation A: to transfer rights to our patent portfolio as it exists when the contract is executed.

• Performance Obligation B: to transfer rights to our patent portfolio as it evolves over the term of the contract, including access to new patent applications that the licensee can benefit from over the term of the contract.

If a fixed fee license agreement contains only Performance Obligation A, we recognize most or all of the revenue from the agreement at the inception of the contract. For fixed fee license agreements that contain both Performance Obligation A and B, we allocate the transaction price based on the standalone price for each of the two performance obligations. We use a number of factors primarily related to the attributes of our patent portfolio to estimate standalone prices related to Performance Obligation A and B. Once the transaction price is allocated, the portion of the transaction price allocable to Performance Obligation A is recognized in the period the license agreement is signed and the customer can benefit from rights provided in the contract. The portion allocable to Performance Obligation B is recognized on a straight-line basis over the contract term. For such contracts, a contract liability account is established and included within Deferred revenue on the Condensed Consolidated Balance Sheets. As the rights and obligations in a contract are interdependent, contract assets and contract liabilities that arise in the same contract are presented on a net basis.

Based on contracts signed and payments received as of March 31, 2021, we expect to recognize $25.2 million in revenue related to Performance Obligation B under our fixed fee license agreements, which is satisfied over time, including $13.2 million over one to three years and $12.0 million over more than three years.

Capitalized Contract Costs

During the three months ended March 31, 2021, we capitalized $0.1 million of incremental costs incurred to obtain new contracts with customers.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
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-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

+ Details

FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

Cash and Cash Equivalents

Our financial instruments measured at fair value on a recurring basis consisted of money market funds. We value these securities based quoted prices in active markets for identical assets.

Financial instruments are valued based on quoted market prices in active markets include mostly money market securities. Such instruments are generally classified within Level 1 of the fair value hierarchy.

Instruments valued based on quoted prices in markets that are less active, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency are generally classified within Level 2 of the fair value hierarchy and include U.S. treasury securities. We had no Level 2 instruments at March 31, 2021 and December 31, 2020.

Instruments valued based on unobservable inputs which reflect the reporting entity’s own assumptions or data that market participants would use in valuing an instrument are generally classified within Level 3 of the fair value hierarchy. As of March 31, 2021 and December 31, 2020, we did not hold any Level 3 instruments.

Our financial instruments consisted of money market accounts as of March 31, 2021 and December 31, 2020 are classified as cash equivalents.

Financial instruments measured at fair value on a recurring basis as of March 31, 2021 and December 31, 2020 are classified based on the valuation technique in the table below (in thousands):


	March 31, 2021
	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets:
Money market accounts	$	70,616	$	—	$	—	$	70,616
Total assets at fair value (1)	$	70,616	$	—	$	—	$	70,616

(1) The above table excludes $32.0 million of cash held in banks.


	December 31, 2020
	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)			Total
Assets:
Money market accounts	45,614		$	—	$	—		$	45,614
Total assets at fair value (2)	$	45,614	$	—	$	—	0	$	45,614

(2) The above table excludes $13.9 million of cash held in banks.

BALANCE SHEET DETAILS

3 Months Ended

Mar. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

BALANCE SHEET DETAILS

BALANCE SHEETS DETAILS

Cash and Cash Equivalents

Our cash and cash equivalent balances were as follows (in thousands):


	March 31, 2021		December 31, 2020
Cash	$	32,008	$	13,908
Money market funds	70,616		45,614
Cash and cash equivalents	$	102,624	$	59,522

Accounts and Other Receivables

Accounts and other receivables consisted of the following (in thousands):


	March 31, 2021		December 31, 2020
Trade accounts receivable	$	1,402	$	1,618
Other receivables	632		600
Accounts and other receivables	$	2,034	$	2,218

Allowance for credit losses as of March 31, 2021 and December 31, 2020 were not material.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):



	March 31, 2021	December 31, 2020
Prepaid expenses	846	816
Contract assets - current	10,172	11,623
Other current assets	195	171
Prepaid expenses and other current assets	11,213	12,610

Other Assets

Other assets consisted of the following (in thousands):


	March 31, 2021		December 31, 2020
Contract assets - long-term	$	3,776	$	4,596
Right-of-use ("ROU") assets	1,439		1,607
Deferred tax assets	2,659		2,659
Other assets	113		138
Total other assets	$	7,987	$	9,000

Other Current Liabilities

Other current liabilities are as follows (in thousands):


	March 31, 2021		December 31, 2020
Lease liabilities - current	1,365		1,382
Other current liabilities	1,353		1,075
Total other current liabilities	$	2,718	$	2,457

CONTINGENCIES	3 Months Ended
CONTINGENCIES	Mar. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
CONTINGENCIES	CONTINGENCIES From time to time, we receive claims from third parties asserting that our technologies, or those of our licensees, infringe on the other parties’ IP rights. Management believes that these claims are without merit. Additionally, periodically, we are involved in routine legal matters and contractual disputes incidental to our normal operations. In management’s opinion, unless we disclosed otherwise, the resolution of such matters will not have a material adverse effect on our consolidated financial condition, results of operations, or liquidity. In the normal course of business, we provide indemnification of varying scope to customers, most commonly to licensees in connection with licensing arrangements that include our IP, although these provisions can cover additional matters. Historically, costs related to these guarantees have not been significant, and we are unable to estimate the maximum potential impact of these guarantees on its future results of operations. Samsung Electronics Co. v. Immersion Corporation and Immersion Software Ireland Limited On April 28, 2017, Immersion and Immersion Software Ireland Limited (collectively, “Immersion”) received a letter from Samsung Electronics Co. (“Samsung”) requesting that we reimburse Samsung with respect to withholding tax and penalties imposed on Samsung by the Korean tax authorities following an investigation where the tax authority determined that Samsung failed to withhold taxes on Samsung’s royalty payments to Immersion Software Ireland from 2012 to 2016. On July 12, 2017, on behalf of Samsung, Immersion filed an appeal with the Korea Tax Tribunal regarding their findings with respect to the withholding taxes and penalties. On October 18, 2018, the Korea Tax Tribunal held a hearing and on November 19, 2018, the Korea Tax Tribunal issued its ruling in which it decided not to accept our arguments with respect to the Korean tax authorities’ assessment of withholding tax and penalties imposed on Samsung. On behalf of Samsung, we filed an appeal with the Korea Administrative Court on February 15, 2019. On July 16, 2020, the Korea Administrative Court issued its ruling in which it ruled that the withholding taxes and penalties which were imposed by the Korean tax authorities on Samsung should be cancelled with some litigation costs to be borne by the Korean tax authorities. On August 1, 2020, the Korean tax authorities filed an appeal with the Korea High Court. The first hearing in the Korea High Court occurred on November 11, 2020. A second hearing occurred on January 13, 2021. A third hearing occurred on March 21, 2021. The Korea High Court indicated that a final decision is expected on May 28, 2021, but reserved the right to delay the date of the decision. On September 29, 2017, Samsung filed an arbitration demand with the International Chamber of Commerce against us demanding that we reimburse Samsung for the imposed tax and penalties that Samsung paid to the Korean tax authorities. Samsung is requesting that we pay Samsung the amount of KRW 7,841,324,165 (approximately $6.9 million) plus interest from and after May 2, 2017, plus the cost of the arbitration including legal fees. On March 27, 2019, we received the final award. The award ordered Immersion to pay Samsung KRW 7,841,324,165 (approximately $6.9 million as of March 31, 2019) which we paid on April 22, 2019 and recorded in Long-term deposit on our Condensed Consolidated Balance Sheets. The award also denied Samsung’s claim for interest from and after May 2, 2017 and ordered Immersion to pay Samsung’s cost of the arbitration in the amount of approximately $871,454, which was paid in 2019. We believe that there are valid defenses to all of the claims from the Korean tax authorities. We intend to vigorously defend against the claims from the Korean tax authorities. We expect to be reimbursed by Samsung to the extent we ultimately prevail in the appeal in the Korea courts. On March 31, 2019, $6.9 million was recorded as a deposit included in Long-term deposits on our Condensed Consolidated Balance Sheets. In the event that we do not ultimately prevail in our appeal in the Korean courts, the deposit included in Long-term deposits would be recorded as additional income tax expense on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), in the period in which we do not ultimately prevail. LGE Korean Withholding Tax Matter On October 16, 2017, we received a letter from LG Electronics Inc. (“LGE”) requesting that we reimburse LGE with respect to withholding tax imposed on LGE by the Korean tax authorities following an investigation where the tax authority determined that LGE failed to withhold on LGE’s royalty payments to Immersion Software Ireland from 2012 to 2014. Pursuant to an agreement reached with LGE, on April 8, 2020, we provided a provisional deposit to LGE in the amount of KRW 5,916,845,454 (approximately $5.0 million) representing the amount of such withholding tax that was imposed on LGE, which provisional deposit would be returned to us to the extent we ultimately prevail in the appeal in the Korea courts. In the second quarter of 2020, we recorded this deposit in Long-term deposits on our Condensed Consolidated Balance Sheets. In the event that we do not ultimately prevail in our appeal in the Korean courts, the deposit included in Long-term deposits would be recorded as additional income tax expense on our Condensed Consolidated Statement of Operations and Comprehensive Loss, in the period in which we do not ultimately prevail. On November 3, 2017, on behalf of LGE, we filed an appeal with the Korea Tax Tribunal regarding their findings with respect to the withholding taxes. The Korea Tax Tribunal hearing took place on March 5, 2019. On March 19, 2019, the Korea Tax Tribunal issued its ruling in which it decided not to accept our arguments with respect to the Korean tax authorities’ assessment of withholding tax and penalties imposed on LGE. On behalf of LGE, we filed an appeal with the Korea Administrative Court on June 10, 2019. The first hearing occurred on October 15, 2019. A second hearing occurred on December 19, 2019. A third hearing occurred on February 13, 2020. A fourth hearing occurred on June 9, 2020. A fifth hearing occurred on July 16, 2020. We anticipated a decision to be rendered on or about October 8, 2020, but the Korea Administrative Court scheduled and held a sixth hearing for November 12, 2020. A seventh hearing occurred on January 14, 2021. An eighth hearing occurred on April 8, 2021. A ninth hearing is scheduled for June 24, 2021. We believe that there are valid defenses to the claims raised by the Korean tax authorities and that LGE’s claims are without merit. We intend to vigorously defend ourselves against these claims. In the event that we do not ultimately prevail in our appeal in the Korean courts, any payments to LGE with respect to withholding tax imposed on LGE by the Korean tax authorities as described in the previous paragraph would be recorded as additional income tax expense on the Condensed Consolidated Statement of Operations and Comprehensive Income (Loss), in the period in which we do not ultimately prevail.

STOCK-BASED COMPENSATION

3 Months Ended

Mar. 31, 2021

Share-based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

Stock Options and Awards

Our equity incentive program is a long-term retention program that is intended to attract, retain, and provide incentives for employees, consultants, officers, and directors and to align stockholder and employee interests. We may grant time-based options, market condition-based options, stock appreciation rights, restricted stock (“RSAs”), restricted stock units (“RSUs”), performance shares, market condition-based performance restricted stock units (“PSUs”), and other stock-based equity awards to employees, officers, directors, and consultants. Under this program, stock options may be granted at prices not less than the fair market value on the date of grant for stock options. Stock options generally vest over four years and expire seven years from the grant date. Market condition-based options are subject to a market condition whereby the closing price of our common stock must exceed a certain level for a number of trading days within a specified time frame or the options will be canceled before the expiration of the options. RSAs generally vest over one year. RSUs generally vest over three years. Awards granted other than a stock option or stock appreciation right shall reduce the common stock shares available for grant by 1.75 shares for every share issued.

A summary of our equity incentive program is as follows (in thousands):


			March 31, 2021
Common stock shares available for grant			3,271
Stock options outstanding			521
PSUs outstanding			250
RSUs outstanding			565
RSAs outstanding			130

Time-Based Stock Options

The following summarizes activities for the time-based stock options for the three months ended March 31, 2021 (in thousands except for weighted average exercise price per share and weighted average remaining contractual life data):


	Number of Shares Underlying Stock Options	Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value
Outstanding at December 31, 2020	828	$	8.16	4.36	$	2,628
Granted	—	$	—
Exercised	(307)	$	8.87
Canceled or expired	—	$	—
Outstanding at March 31, 2021	521	$	7.74	5.21	$	1,020
Vested and expected to vest at March 31, 2021	447	$	7.76	5.18	$	866
Exercisable at March 31, 2021	129	$	8.32	4.69	$	212

Aggregate intrinsic value is the difference between the closing price on the last trading day in March 2021 and the exercise price, multiplied by the number of in-the-money stock options.

Restricted Stock Units

The following summarizes RSU activities for the three months ended March 31, 2021 (in thousands except for weighted average grant date fair value and weighted average remaining contractual life data):


	Number of Restricted Stock Units	Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value
Outstanding at December 31, 2020	802	$	6.98	1.00	$	9,057
Granted	—	$	—
Released	(227)	$	7.49
Forfeited	(10)	$	6.74
Outstanding at March 31, 2021	565	$	6.78	1.08	$	5,415

Restricted Stock Awards

The following summarizes RSA activities for the three months ended March 31, 2021 (in thousands except for weighted average grant date fair value and weighted average remaining recognition period):


	Number of Restricted Stock Awards	Weighted Average Grant Date Fair Value		Weighted Average Remaining Recognition Period (Years)
Outstanding at December 31, 2020	130	$	6.53	0.45
Granted	—	$	—
Released	—	$	—
Forfeited	—	$	—
Outstanding at March 31, 2021	130	$	6.53	0.20

Market Condition-Based Restricted Stock Units

In the fourth quarter of 2020, we granted 250,000 shares of PSUs to our executives. Each PSU represents the right to one share of our common stock. These equity awards will vest if the volume-weighted closing price of our common stock exceeds certain levels for a number of trading days within a specified time frame. These awards vest over four years, with 25% eligible for vesting on the first anniversary of the grant date and remaining shares vesting on quarterly basis over the following three years. We have 250,000 shares of PSUs outstanding as of March 31, 2021.

Employee Stock Purchase Plan

Under our 1999 Employee Stock Purchase Plan ("ESPP"), eligible employees may purchase common stock through payroll deductions at a purchase price of 85% of the lower of the fair market value of our common stock at the beginning of the offering period or the purchase date. Participants may not purchase more than 2,000 shares in a six months offering period or purchase stock having a value greater than $25,000 in any calendar year as measured at the beginning of the offering period. A total of 1.0 million shares of common stock has been reserved for issuance under the ESPP. During the three months ended March 31, 2021, 15,543 shares were purchased under the ESPP. As of March 31, 2021, 215,338 shares were available for future purchase under the ESPP.

Stock-based Compensation Expense

The following table summarizes stock-based compensation expenses recognized for the three months ended March 31, 2021 and 2020 (in thousands):


	Three Months Ended March 31,
	2021		2020
Stock options	$	15	$	255
RSUs and RSAs	497		462
Employee stock purchase plan	19		12
Total	$	531	$	729

Sales and marketing	$	224	$	45
Research and development	318		168
General and administrative	(11)		516
Total	$	531	$	729

We use the Black-Scholes-Merton option pricing model for our time-based options, single-option approach to determine the fair value of standard stock options. All share-based payment awards are amortized on a straight-line basis over the requisite service periods of the awards, which are generally the vesting periods.

The determination of the fair value of share-based awards on the date of grant using an option pricing model is affected by our stock price as well as assumptions regarding a number of complex and subjective variables. These variables include actual and projected employee stock option exercise behaviors that impact the expected term, our expected stock price volatility over the term of the awards, risk-free interest rate, and expected dividend.

The assumptions used to value options granted under our equity incentive program are as follows:


	Three Months Ended March 31,
	2021 (1)	2020
Expected life (in years)	N/A	4.2
Volatility	N/A	52	%
Interest rate	N/A	1.0	%
Dividend yield	N/A	—	%

(1) There were no stock option grants in the three months ended March 31, 2021

As of March 31, 2021, there were $5.3 million of unrecognized compensation costs, adjusted for estimated forfeitures, related to non-vested stock options, RSAs and RSUs. This unrecognized compensation cost will be recognized over an estimated weighted-average period of approximately 1.8 years. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures.

STOCKHOLDERS' EQUITY	3 Months Ended
STOCKHOLDERS' EQUITY	Mar. 31, 2021
Equity [Abstract]
STOCKHOLDERS' EQUITY	STOCKHOLDERS’ EQUITY Stock Offering On February 3, 2021, we filed an universal shelf registration statement on Form S-3 with the Securities and Exchange Commission which provided us with the financial flexibility to raise up to $250 million of capital. We intend to use the net proceeds from the sale of the securities offered by this prospectus for working capital and other general corporate purposes, and we may use a portion of any net proceeds for investment in complementary businesses or alternative currencies. On February 11, 2021, we entered into an equity distribution agreement ("Distribution Agreement") with an investment banking firm to issue and sell shares of our common stock having an aggregated offering price of up to $50 million. Under the terms of the Distribution Agreement, we are obligated to pay 2.25% commission on the gross sales proceeds from common stock sold and customary indemnification rights and the reimbursement of legal fees and disbursements. The Distribution Agreement may be terminated by either party upon prior written notice to the other party, or at any time under certain circumstances. We are not obligated to sell any shares under the Distribution Agreement. During the first quarter of 2021, we sold 3.3 million shares of our common stock pursuant to the Distribution Agreement and we received net proceeds of $35.9 million from the offering net of $1.2 million of commissions and other offering costs. We terminated the Distribution Agreement on March 5, 2021. Stock Repurchase Program On November 1, 2007, our Board of Directors (the “Board”) authorized the repurchase of up to $50.0 million of our common stock (the “Stock Repurchase Program”). In addition, on October 22, 2014, the Board authorized another $30.0 million under the Stock Repurchase Program. As of June 30, 2020, we repurchased the maximum amount of shares of common stock available under the Stock Repurchase Program and no longer have any amount available for repurchase under the Stock Repurchase Plan. During the first quarter of 2020, we repurchased approximately 2.0 million shares for approximately $12.0 million at an average cost of $5.95 per share.

INCOME TAXES

3 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

INCOME TAXES

Income tax provision consisted of the following (in thousands, except for effective tax rate percentage):


	Three Months Ended March 31,
	2021		2020
Income (loss) before provision for income taxes	2,177		(4,776)
Provision for income taxes	141		52
Effective tax rate	6.5	%	(1.1)	%

The provision for income tax for the three months ended March 31, 2021 and 2020, respectively, resulted primarily from estimated foreign taxes included in the calculation of the effective tax rate. We continue to carry a full valuation allowance on our U.S. federal and State as well as Canada federal deferred tax assets. The effective tax rate is lower than statutory tax rate is mainly due to the benefit recorded on deferred tax assets utilized in current year for the U.S. federal and state jurisdictions.

As of March 31, 2021, we had unrecognized tax benefits under ASC 740 Income Taxes of approximately $4.5 million and applicable interest of $0. The total amount of unrecognized tax benefits that would affect our effective tax rate, if recognized, is $0. Our policy is to account for interest and penalties related to uncertain tax positions as a component of income tax provision. We do not expect to have any significant changes to unrecognized tax benefits during the next twelve months.

As of March 31, 2021, we had net deferred income tax assets of $2.7 million and deferred income tax liabilities of $0.4 million. Because we have net operating loss and credit carryforwards, there are open statutes of limitations in which federal, state, and foreign taxing authorities may examine our tax returns for all years from 2001 through the current period. Currently we are under examination by the Internal Revenue Services for tax year 2018 and California Franchise Tax Board for tax years 2017 to 2019.We maintain a valuation allowance of $28.5 million against certain of our deferred tax assets, including all federal, state, and certain foreign deferred tax assets because of uncertainties regarding the realization of the asset balance due to historical losses, the variability of operating results, and uncertainty regarding near term projected results. If we determine the deferred tax assets are realizable based on our assessment of relevant factors, an adjustment to the valuation allowance may increase income in the period such determination is made.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References + Details

NET INCOME (LOSS) PER SHARE

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

NET INCOME (LOSS) PER SHARE

Basic net income (loss) per share is computed using the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is computed using the weighted average number of shares of common stock, adjusted for any dilutive effect of potential common stock. Potential common stock, computed using the treasury stock method, includes stock options, RSUs, RSAs and ESPP.

The following is a reconciliation of the numerators and denominators used in computing basic and diluted net income (loss) per share (in thousands, except per share amounts):


	Three Months Ended March 31,
	2021		2020
Numerator:
Net income (loss)	$	2,036	$	(4,828)
Denominator:
Weighted-average common stock outstanding, basic	28,579		31,006
Dilutive effect of potential common shares:
Stock options, stock awards and ESPP	601		—
Total shares, diluted	29,180		31,006
Basic net income (loss) per share	$	0.07	$	(0.16)
Diluted net income (loss) per share	$	0.07	$	(0.16)

We include the underlying market condition stock awards in the calculation of diluted earnings per share if the performance condition has been satisfied as of the end of the reporting period and exclude stock equity awards if the performance condition has not been met.

For the three months ended March 31, 2021, we had stock options, RSUs, PSUs and RSAs outstanding that could potentially dilute basic earnings per share in the future, but these were excluded from the computation of diluted net income (loss) per share because their effect would have been anti-dilutive. These outstanding securities consisted of the following (in thousands):


	Three Months Ended March 31,
	2021	2020
Stock options	14	1,370
RSUs and RSAs	—	1,263
	14	2,633

LEASES

3 Months Ended

Mar. 31, 2021

Leases [Abstract]

LEASES

We lease our office space under lease arrangements with expiration dates on or before February 29, 2024. We recognize lease expense on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded on the Condensed Consolidated Balance Sheets. We combine lease and non-lease components for new and reassessed leases. We apply discount rates to operating leases using a portfolio approach.

Below is a summary of our right-of-use assets (“ROU”) assets and lease liabilities as of March 31, 2021 and December 31, 2020, respectively (in thousands):


	Balance Sheets Classification	March 31, 2021		December 31, 2020
Assets
Right-of-use assets	Other assets	$	1,439	$	1,607
Liabilities
Operating lease liabilities - current	Other current liabilities	1,365		1,382
Operating lease liabilities - long-term	Other long-term liabilities	1,351		1,677
Total lease liabilities		$	2,716	$	3,059

On January 31, 2020, we entered into an agreement to lease approximately 5,000 square feet of office space in San Francisco, California (“SF Facility”). This facility is used for administrative functions. The lease commenced in the first quarter of 2020 and expires in 2022. In the first quarter of 2020, we recorded a lease liability of $0.6 million, which represents the present value of the lease payments using an estimated incremental borrowing rate of 3.50%. We also recognized ROU of $0.6 million which represents our right to use an underlying asset for the lease term. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term.

As a result of COVID-19, we implemented work-from-home policy in the first quarter of 2020. Our San Francisco office has been closed since the first quarter of 2020 and we expect our San Francisco-based employees to continue to work-from-home in the foreseeable future. We have been actively seeking a sublease tenant for the SF Facility. In the fourth quarter of 2020, we recorded $0.3 million impairment charge to the SF Facility ROU asset.

On November 12, 2014, we entered into an amendment to the lease of approximately 42,000 square feet office space in San Jose, California facilities (“SJ Facility”). The lease commenced in May 2015 and expires as of April 2023.

On March 12, 2020, we entered into a sublease agreement with Neato Robotics, Inc. (“Neato”) for the SJ Facility. This sublease commenced in June 2020 and ends on April 30, 2023 which is the lease termination date of the original SJ Facility lease. In accordance with provisions of ASC 842 Leases (“ASC 842”), we treated the sublease as a separate lease as we were not relieved of the primary obligation under the original lease. We continue to account for the original SJ Facility, as a lessee, in the same manner as prior to the commencement date of the sublease. We accounted for the sublease as a lessor of the lease. We classified the sublease as an operating lease as it did not meet the criteria of a Sale-Type or Direct Financing lease.

At the commencement date of the sublease, we recognized initial direct costs of $0.3 million. These deferred costs will be amortized over the terms of the sublease payments. As of March 31, 2021, $0.1 million was reported in Prepaid expenses and other current assets and $0.1 million was reported in Other assets on our Condensed Consolidated Balance Sheets.

We recognize operating lease expense and lease payments from the sublease, on a straight-line basis, in our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) over the lease terms. During the three months ended March 31, 2021, and 2020, our net operating lease expenses are as follows (in thousands):


	Three Months Ended March 31,
	2021		2020
Operating lease cost	$	215	$	273
Sublease income	(257)		—
Net lease cost (income)	$	(42)	$	273

The table below provides supplemental information related to operating leases for the three months ended March 31, 2021 and 2020 (in thousands except for lease term):


	Three Months Ended March 31,
	2021		2020
Cash paid within operating cash flow	$	367	$	349
Weighted average lease terms	2.2		2.9
Weighted average discount rate	N/A		3.5		%

Minimum future lease payment obligations for our operating leases as of March 31, 2021 are as follows (in thousands):


For the Years Ending December 31,
Remainder of 2021	$	1,131
2022	1,225
2023	462
2024	25
Total	$	2,843

Future lease payments as of March 31, 2021 from our sublease agreement are as follows (in thousands):


For the Years Ending December 31,
Remainder of 2021	$	789
2022	1,077
2023	351
Total	$	2,217

SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
SIGNIFICANT ACCOUNTING POLICIES (Policies)	Mar. 31, 2021
Accounting Policies [Abstract]
Description of Business	Description of Business Immersion Corporation (the "Company", "Immersion", "we" or "us") was incorporated in 1993 in California and reincorporated in Delaware in 1999. We focus on the creation, design, development, and licensing of innovative haptic technologies that allow people to use their sense of touch more fully as they engage with products and experience the digital world around them. We have adopted a business model under which it provides advanced tactile software, related tools, technical assistance designed to help integrate our patented technology into our customers’ products or enhance the functionality of our patented technology to certain customers, and offers licenses to our patented technology to other customers.
Principles of Consolidation and Basis of Presentation	Principles of Consolidation and Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of Immersion Corporation and our wholly-owned subsidiaries. All intercompany accounts, transactions, and balances have been eliminated in consolidation. The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, these condensed consolidated financial statements do not include all information and footnotes necessary for a complete presentation of the financial position, results of operations, and cash flows, in conformity with U.S. GAAP and should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020. In the opinion of management, all adjustments consisting of only normal and recurring items necessary for the fair presentation of the financial position and results of operations for the interim periods presented have been included.
Use of Estimates	Use of Estimates The preparation of condensed consolidated financial statements and related disclosures requires management to make estimates and assumptions that affect the reported amounts of the condensed consolidated financial statements. Significant estimates include revenue recognition, useful lives of property and equipment, valuation of income taxes including uncertain tax provisions, stock-based compensation and income taxes. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the full year.
Segment Information	Segment Information We develop, license, and support a wide range of software and IP that more fully engage users’ senses of touch when operating digital devices. We focus on the following target application areas: mobile devices, wearables, consumer, mobile entertainment and other content; console gaming; automotive; medical; and commercial. We manage these application areas in one operating and reporting segment with only one set of management, development, and administrative personnel. Our chief operating decision maker (“CODM”) is the Chief Executive Officer. The CODM approves budgets and allocates resources to and assesses the performance of our business using information about our revenue and operating loss. There is only one segment that is reported to management.
Recently Adopted Accounting Pronouncements	Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standard Board (the "FASB") issued Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which enhances and simplifies various aspects of the income tax accounting guidance, including requirements such as tax basis step-up in goodwill obtained in a transaction that is not a business combination, ownership changes in investments, and interim-period accounting for enacted changes in tax law. The amendment is effective for public companies with fiscal years beginning after December 15, 2020; early adoption is permitted. We adopted this new guidance in the first quarter of 2021. This adoption did not have material impact on our condensed consolidated financial statements.

- Definition

Disclosure of accounting policy for segment reporting.

+ References + Details

REVENUE RECOGNITION (Tables)

3 Months Ended

Mar. 31, 2021

Revenue from Contract with Customer [Abstract]

Disaggregated revenue

The following table presents the disaggregation of our revenue for the three months ended March 31, 2021 and 2020 (in thousands).


	Three Months Ended March 31,
	2021		2020
Fixed fee license revenue	$	1,275	$	1,287
Per-unit royalty revenue	5,793		4,895
Total royalty and license revenue	7,068		6,182
Development, services, and other revenue	91		75
Total revenue	$	7,159	$	6,257

FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

Schedule of financial instruments measured at fair value on recurring basis

Financial instruments measured at fair value on a recurring basis as of March 31, 2021 and December 31, 2020 are classified based on the valuation technique in the table below (in thousands):


	March 31, 2021
	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets:
Money market accounts	$	70,616	$	—	$	—	$	70,616
Total assets at fair value (1)	$	70,616	$	—	$	—	$	70,616

(1) The above table excludes $32.0 million of cash held in banks.


	December 31, 2020
	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)			Total
Assets:
Money market accounts	45,614		$	—	$	—		$	45,614
Total assets at fair value (2)	$	45,614	$	—	$	—	0	$	45,614

(2) The above table excludes $13.9 million of cash held in banks.

BALANCE SHEET DETAILS (Tables)

3 Months Ended

Mar. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of cash and cash equivalents

cash and cash equivalent balances were as follows (in thousands):


	March 31, 2021		December 31, 2020
Cash	$	32,008	$	13,908
Money market funds	70,616		45,614
Cash and cash equivalents	$	102,624	$	59,522

Schedule of accounts and other receivables

Accounts and other receivables consisted of the following (in thousands):


	March 31, 2021		December 31, 2020
Trade accounts receivable	$	1,402	$	1,618
Other receivables	632		600
Accounts and other receivables	$	2,034	$	2,218

Schedule of prepaid expenses and other current assets

Prepaid expenses and other current assets consisted of the following (in thousands):



	March 31, 2021	December 31, 2020
Prepaid expenses	846	816
Contract assets - current	10,172	11,623
Other current assets	195	171
Prepaid expenses and other current assets	11,213	12,610

Schedule of other assets, net

Other assets consisted of the following (in thousands):


	March 31, 2021		December 31, 2020
Contract assets - long-term	$	3,776	$	4,596
Right-of-use ("ROU") assets	1,439		1,607
Deferred tax assets	2,659		2,659
Other assets	113		138
Total other assets	$	7,987	$	9,000

Components of other current liabilities

Other current liabilities are as follows (in thousands):


	March 31, 2021		December 31, 2020
Lease liabilities - current	1,365		1,382
Other current liabilities	1,353		1,075
Total other current liabilities	$	2,718	$	2,457

STOCK-BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2021

Share-based Payment Arrangement [Abstract]

Summary of equity incentive program

A summary of our equity incentive program is as follows (in thousands):


			March 31, 2021
Common stock shares available for grant			3,271
Stock options outstanding			521
PSUs outstanding			250
RSUs outstanding			565
RSAs outstanding			130

Summary of time-based stock options


	Number of Shares Underlying Stock Options	Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value
Outstanding at December 31, 2020	828	$	8.16	4.36	$	2,628
Granted	—	$	—
Exercised	(307)	$	8.87
Canceled or expired	—	$	—
Outstanding at March 31, 2021	521	$	7.74	5.21	$	1,020
Vested and expected to vest at March 31, 2021	447	$	7.76	5.18	$	866
Exercisable at March 31, 2021	129	$	8.32	4.69	$	212

Summary of restricted stock units activities


	Number of Restricted Stock Units	Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value
Outstanding at December 31, 2020	802	$	6.98	1.00	$	9,057
Granted	—	$	—
Released	(227)	$	7.49
Forfeited	(10)	$	6.74
Outstanding at March 31, 2021	565	$	6.78	1.08	$	5,415

Summary of restricted stock awards activities

The following summarizes RSA activities for the three months ended March 31, 2021 (in thousands except for weighted average grant date fair value and weighted average remaining recognition period):


	Number of Restricted Stock Awards	Weighted Average Grant Date Fair Value		Weighted Average Remaining Recognition Period (Years)
Outstanding at December 31, 2020	130	$	6.53	0.45
Granted	—	$	—
Released	—	$	—
Forfeited	—	$	—
Outstanding at March 31, 2021	130	$	6.53	0.20

Summary of stock-based compensation expenses

The following table summarizes stock-based compensation expenses recognized for the three months ended March 31, 2021 and 2020 (in thousands):


	Three Months Ended March 31,
	2021		2020
Stock options	$	15	$	255
RSUs and RSAs	497		462
Employee stock purchase plan	19		12
Total	$	531	$	729

Sales and marketing	$	224	$	45
Research and development	318		168
General and administrative	(11)		516
Total	$	531	$	729

Summary of assumptions used to value options granted

The assumptions used to value options granted under our equity incentive program are as follows:


	Three Months Ended March 31,
	2021 (1)	2020
Expected life (in years)	N/A	4.2
Volatility	N/A	52	%
Interest rate	N/A	1.0	%
Dividend yield	N/A	—	%

INCOME TAXES (Tables)

3 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

Schedule of income tax provisions

Income tax provision consisted of the following (in thousands, except for effective tax rate percentage):


	Three Months Ended March 31,
	2021		2020
Income (loss) before provision for income taxes	2,177		(4,776)
Provision for income taxes	141		52
Effective tax rate	6.5	%	(1.1)	%

NET INCOME (LOSS) PER SHARE (Tables)

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

Reconciliation of the numerators and denominators used in computing basic and diluted net income (loss) per share

The following is a reconciliation of the numerators and denominators used in computing basic and diluted net income (loss) per share (in thousands, except per share amounts):


	Three Months Ended March 31,
	2021		2020
Numerator:
Net income (loss)	$	2,036	$	(4,828)
Denominator:
Weighted-average common stock outstanding, basic	28,579		31,006
Dilutive effect of potential common shares:
Stock options, stock awards and ESPP	601		—
Total shares, diluted	29,180		31,006
Basic net income (loss) per share	$	0.07	$	(0.16)
Diluted net income (loss) per share	$	0.07	$	(0.16)

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share


	Three Months Ended March 31,
	2021	2020
Stock options	14	1,370
RSUs and RSAs	—	1,263
	14	2,633

LEASES (Tables)

3 Months Ended

Mar. 31, 2021

Leases [Abstract]

Summary of ROU assets and lease liabilities

Below is a summary of our right-of-use assets (“ROU”) assets and lease liabilities as of March 31, 2021 and December 31, 2020, respectively (in thousands):


	Balance Sheets Classification	March 31, 2021		December 31, 2020
Assets
Right-of-use assets	Other assets	$	1,439	$	1,607
Liabilities
Operating lease liabilities - current	Other current liabilities	1,365		1,382
Operating lease liabilities - long-term	Other long-term liabilities	1,351		1,677
Total lease liabilities		$	2,716	$	3,059

Schedule of supplemental information related to operating leases and expenses

During the three months ended March 31, 2021, and 2020, our net operating lease expenses are as follows (in thousands):


	Three Months Ended March 31,
	2021		2020
Operating lease cost	$	215	$	273
Sublease income	(257)		—
Net lease cost (income)	$	(42)	$	273

Schedule of minimum future lease payment obligations

The table below provides supplemental information related to operating leases for the three months ended March 31, 2021 and 2020 (in thousands except for lease term):


	Three Months Ended March 31,
	2021		2020
Cash paid within operating cash flow	$	367	$	349
Weighted average lease terms	2.2		2.9
Weighted average discount rate	N/A		3.5		%

Minimum future lease payment obligations for our operating leases as of March 31, 2021 are as follows (in thousands):


For the Years Ending December 31,
Remainder of 2021	$	1,131
2022	1,225
2023	462
2024	25
Total	$	2,843

Schedule of sublease income expected to be received

Future lease payments as of March 31, 2021 from our sublease agreement are as follows (in thousands):


For the Years Ending December 31,
Remainder of 2021	$	789
2022	1,077
2023	351
Total	$	2,217

SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions	3 Months Ended
SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions	Mar. 31, 2021 USD ($) Segment
Accounting Policies [Abstract]
IMMR:GovernmentSubsidyRecognized \| $	$ 0.1
Number of operating segments	1
Number of reporting segments	1

REVENUE RECOGNITION - NARRATIVE (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Revenue from Contract with Customer [Abstract]
Contract with customer, asset, current	$ 10,172		$ 11,623
Contract assets - long-term	3,776		$ 4,596
Increase (Decrease) in Contract with Customer, Asset	(2,300)
Royalty Revenue, Adjustment	$ (500)	$ (100)

REVENUE RECOGNITION - DISAGGREGATED REVENUE (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Disaggregation of Revenue [Line Items]
Revenues	$ 7,159	$ 6,257
Fixed fee license revenue
Disaggregation of Revenue [Line Items]
Revenues	1,275	1,287
Per-unit royalty revenue
Disaggregation of Revenue [Line Items]
Revenues	5,793	4,895
Total royalty and license revenue
Disaggregation of Revenue [Line Items]
Revenues	7,068	6,182
Development, services, and other revenue
Disaggregation of Revenue [Line Items]
Revenues	$ 91	$ 75

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8906-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130543-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

REVENUE RECOGNITION - CONTRACTED REVENUE (Details) $ in Millions	Mar. 31, 2021 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation	$ 25.2
Capitalized Contract Cost, Net	0.1
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation	$ 13.2
Revenue, remaining performance obligation, period	3 years
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation	$ 12.0
Revenue, remaining performance obligation, period

FAIR VALUE MEASUREMENTS - SCHEDULE OF FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE ON RECURRING BASIS (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash held in banks	$ 32,008	$ 13,908
Fair value, measurements, recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	70,616	45,614
Fair value, measurements, recurring \| Money market accounts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market accounts	70,616	45,614
Fair value, measurements, recurring \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	70,616	45,614
Fair value, measurements, recurring \| Quoted Prices in Active Markets for Identical Assets (Level 1) \| Money market accounts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market accounts	70,616	45,614
Fair value, measurements, recurring \| Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	0	0
Fair value, measurements, recurring \| Significant Other Observable Inputs (Level 2) \| Money market accounts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market accounts	0	0
Fair value, measurements, recurring \| Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	0	0
Fair value, measurements, recurring \| Significant Unobservable Inputs (Level 3) \| Money market accounts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market accounts	$ 0	$ 0

BALANCE SHEET DETAILS - Cash and Cash Equivalents (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Cash and cash equivalents:
Cash	$ 32,008	$ 13,908
Money market funds	70,616	45,614
Cash and cash equivalents	$ 102,624	$ 59,522

BALANCE SHEET DETAILS - Accounts and Other Receivables (Detail) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Receivables [Abstract]
Trade accounts receivable	$ 1,402	$ 1,618
Other receivables	632	600
Accounts and other receivables	$ 2,034	$ 2,218

BALANCE SHEET DETAILS - Other Assets, Net (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Other Assets, Net [Abstract]
Contract assets - long-term	$ 3,776	$ 4,596
Right-of-use ("ROU") assets	1,439	1,607
Deferred tax assets	2,659	2,659
Other assets	113	138
Total other assets	$ 7,987	$ 9,000

BALANCE SHEET DETAILS - Other Current Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Other Liabilities, Current [Abstract]
Lease liabilities - current	$ 1,365	$ 1,382
Other current liabilities	1,353	1,075
Total other current liabilities	$ 2,718	$ 2,457

BALANCE SHEETS DETAILS Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid Expense		$ 816
Contract with Customer, Asset, after Allowance for Credit Loss, Current	$ 10,172	11,623
Other Assets, Current	195	171
Prepaid expenses and other current assets	11,213	$ 12,610
Prepaid Expense, Current	$ 846

CONTINGENCIES - NARRATIVE (Details)	Apr. 08, 2020 USD ($)	Apr. 08, 2020 KRW (₩)	Mar. 27, 2019 USD ($)	Mar. 27, 2019 KRW (₩)	Mar. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Mar. 31, 2020 USD ($)
Loss Contingencies [Line Items]
Deposits Assets, Noncurrent					$ 12,296,000	$ 12,571,000	$ 6,900,000
LGE
Loss Contingencies [Line Items]
Payments for Deposits	$ 5,000,000.0	₩ 5,916,845,454
Payments for Deposits	$ 5,000,000.0	₩ 5,916,845,454
Samsung vs. Immersion \| Withholding taxes on royalty payments
Loss Contingencies [Line Items]
Litigation, amount awarded to other party			$ 6,900,000	₩ 7,841,324,165
Litigation, arbitration costs			$ 871,454

STOCK-BASED COMPENSATION - NARRATIVE (Details)	3 Months Ended
STOCK-BASED COMPENSATION - NARRATIVE (Details)	Mar. 31, 2021 USD ($) shares	Dec. 31, 2020 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of available shares consumed for each restricted stock and restricted stock units issued	1.75
Restricted stock outstanding (in shares)		802,000
Shares available for purchase (in shares)	215,338
Unrecognized compensation cost \| $	$ 5,300,000
Unrecognized compensation cost, recognized over an estimated weighted-average period	1 year 9 months 18 days
Stock options outstanding
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based payment award vesting period	4 years
Stock-based payment award expiration period	7 years
RSAs outstanding