0000101984-20-000048 | 10-Q | XBRL Viewer | Universal Electronics INC

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Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2020	Nov. 03, 2020
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Current Fiscal Year End Date	--12-31
Entity File Number	0-21044
Entity Registrant Name	UNIVERSAL ELECTRONICS INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	33-0204817
Entity Address, Address Line One	15147 N. Scottsdale Road, Suite H300
Entity Address, City or Town	Scottsdale
Entity Address, State or Province	AZ
Entity Address, Postal Zip Code	85254-2494
City Area Code	480
Local Phone Number	530-3000
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	UEIC
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		13,749,676
Document Period End Date	Sep. 30, 2020
Document Fiscal Period Focus	Q3
Amendment Flag	false
Document Fiscal Year Focus	2020
Entity Central Index Key	0000101984

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 67,146	$ 74,302
Accounts receivable, net	128,094	139,198
Contract assets	11,530	12,579
Inventories	115,750	145,135
Prepaid expenses and other current assets	5,768	6,733
Income tax receivable	1,536	805
Total current assets	329,824	378,752
Property, plant and equipment, net	84,549	90,732
Goodwill	48,526	48,447
Intangible assets, net	19,617	19,830
Operating lease right-of-use assets	18,678	19,826
Deferred income taxes	4,581	4,409
Other assets	2,842	2,163
Total assets	508,617	564,159
Current liabilities:
Accounts payable	67,546	102,588
Line of credit	50,000	68,000
Accrued compensation	22,890	43,668
Accrued sales discounts, rebates and royalties	10,183	9,766
Accrued income taxes	9,910	6,989
Other accrued liabilities	33,616	35,445
Total current liabilities	194,145	266,456
Long-term liabilities:
Operating lease obligations	13,284	15,639
Contingent consideration	250	4,349
Deferred income taxes	2,327	1,703
Income tax payable	1,368	1,600
Other long-term liabilities	688	13
Total liabilities	212,062	289,760
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value, 5,000,000 shares authorized; none issued or outstanding	0	0
Common stock, $0.01 par value, 50,000,000 shares authorized; 24,292,657 and 24,118,088 shares issued on September 30, 2020 and December 31, 2019, respectively	243	241
Paid-in capital	296,674	288,338
Treasury stock, at cost, 10,437,363 and 10,174,199 shares on September 30, 2020 and December 31, 2019, respectively	(287,639)	(277,817)
Accumulated other comprehensive income (loss)	(25,555)	(22,781)
Retained earnings	312,832	286,418
Total stockholders' equity	296,555	274,399
Total liabilities and stockholders' equity	$ 508,617	$ 564,159

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2020	Dec. 31, 2019
Stockholders' equity:
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	5,000,000	5,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	50,000,000	50,000,000
Common stock, shares issued (in shares)	24,292,657	24,118,088
Treasury stock, shares (in shares)	10,437,363	10,174,199

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Income Statement [Abstract]
Net sales	$ 153,505	$ 200,724	$ 458,416	$ 578,783
Cost of sales	109,349	154,245	333,244	458,437
Gross profit	44,156	46,479	125,172	120,346
Research and development expenses	7,696	7,930	22,979	21,884
Selling, general and administrative expenses	26,214	32,422	77,441	94,598
Operating income	10,246	6,127	24,752	3,864
Interest income (expense), net	(268)	(784)	(1,272)	(3,088)
Accrued social insurance adjustment	0	0	9,464	0
Other income (expense), net	(1,646)	(148)	(1,263)	(426)
Income before provision for income taxes	8,332	5,195	31,681	350
Provision for income taxes	2,164	2,526	5,267	3,747
Net income (loss)	$ 6,168	$ 2,669	$ 26,414	$ (3,397)
Earnings (loss) per share:
Basic (in dollars per share)	$ 0.44	$ 0.19	$ 1.90	$ (0.25)
Diluted (in dollars per share)	$ 0.43	$ 0.19	$ 1.86	$ (0.25)
Shares used in computing earnings (loss) per share:
Basic (in shares)	13,928	13,894	13,935	13,861
Diluted (in shares)	14,205	14,170	14,189	13,861

CONSOLIDATED COMPREHENSIVE INCOME (LOSS) STATEMENTS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 6,168	$ 2,669	$ 26,414	$ (3,397)
Other comprehensive income (loss):
Change in foreign currency translation adjustment	5,005	(5,457)	(2,774)	(5,557)
Comprehensive income (loss)	$ 11,173	$ (2,788)	$ 23,640	$ (8,954)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock Issued	Common Stock in Treasury	Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Retained Earnings
Balance (in shares) at Dec. 31, 2018		23,933	(10,116)
Balance at Dec. 31, 2018	$ 262,960	$ 239	$ (275,889)	$ 276,103	$ (20,281)	$ 282,788
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(1,005)					(1,005)
Currency translation adjustment	1,733				1,733
Shares issued for employee benefit plan and compensation (in shares)		78
Shares issued for employee benefit plan and compensation	347	$ 1		346
Purchase of treasury shares (in shares)			(43)
Purchase of treasury shares	(1,215)		$ (1,215)
Shares issued to directors (in shares)		8
Shares issued to directors	0	$ 0
Employee and director stock-based compensation	1,918			1,918
Performance-based common stock warrants	434			434
Balance (in shares) at Mar. 31, 2019		24,019	(10,159)
Balance at Mar. 31, 2019	265,172	$ 240	$ (277,104)	278,801	(18,548)	281,783
Balance (in shares) at Dec. 31, 2018		23,933	(10,116)
Balance at Dec. 31, 2018	262,960	$ 239	$ (275,889)	276,103	(20,281)	282,788
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(3,397)
Currency translation adjustment	$ (5,557)
Purchase of treasury shares (in shares)	(55)
Purchase of treasury shares	$ (1,741)
Balance (in shares) at Sep. 30, 2019		24,099	(10,171)
Balance at Sep. 30, 2019	261,651	$ 241	$ (277,630)	285,487	(25,838)	279,391
Balance (in shares) at Mar. 31, 2019		24,019	(10,159)
Balance at Mar. 31, 2019	265,172	$ 240	$ (277,104)	278,801	(18,548)	281,783
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(5,061)					(5,061)
Currency translation adjustment	(1,833)				(1,833)
Shares issued for employee benefit plan and compensation (in shares)		17
Shares issued for employee benefit plan and compensation	273			273
Purchase of treasury shares (in shares)			(5)
Purchase of treasury shares	(189)		$ (189)
Shares issued to directors (in shares)		7
Shares issued to directors	0	$ 0		0
Employee and director stock-based compensation	2,273			2,273
Performance-based common stock warrants	236			236
Balance (in shares) at Jun. 30, 2019		24,043	(10,164)
Balance at Jun. 30, 2019	260,871	$ 240	$ (277,293)	281,583	(20,381)	276,722
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	2,669					2,669
Currency translation adjustment	(5,457)				(5,457)
Shares issued for employee benefit plan and compensation (in shares)		29
Shares issued for employee benefit plan and compensation	256	$ 1		255
Purchase of treasury shares (in shares)			(7)
Purchase of treasury shares	(337)		$ (337)
Stock options exercised (in shares)		20
Stock options exercised	411			411
Shares issued to directors (in shares)		7
Shares issued to directors	0	$ 0		0
Employee and director stock-based compensation	2,527			2,527
Performance-based common stock warrants	711			711
Balance (in shares) at Sep. 30, 2019		24,099	(10,171)
Balance at Sep. 30, 2019	261,651	$ 241	$ (277,630)	285,487	(25,838)	279,391
Balance (in shares) at Dec. 31, 2019		24,118	(10,174)
Balance at Dec. 31, 2019	274,399	$ 241	$ (277,817)	288,338	(22,781)	286,418
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	5,846					5,846
Currency translation adjustment	(7,009)				(7,009)
Shares issued for employee benefit plan and compensation (in shares)		129
Shares issued for employee benefit plan and compensation	527	$ 1		526
Purchase of treasury shares (in shares)			(169)
Purchase of treasury shares	(6,291)		$ (6,291)
Shares issued to directors (in shares)		9
Shares issued to directors	0	$ 1		(1)
Employee and director stock-based compensation	2,303			2,303
Performance-based common stock warrants	184			184
Balance (in shares) at Mar. 31, 2020		24,256	(10,343)
Balance at Mar. 31, 2020	269,959	$ 243	$ (284,108)	291,350	(29,790)	292,264
Balance (in shares) at Dec. 31, 2019		24,118	(10,174)
Balance at Dec. 31, 2019	274,399	$ 241	$ (277,817)	288,338	(22,781)	286,418
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	26,414
Currency translation adjustment	$ (2,774)
Purchase of treasury shares (in shares)	(263)
Purchase of treasury shares	$ (9,822)
Stock options exercised (in shares)	0
Balance (in shares) at Sep. 30, 2020		24,293	(10,437)
Balance at Sep. 30, 2020	$ 296,555	$ 243	$ (287,639)	296,674	(25,555)	312,832
Balance (in shares) at Mar. 31, 2020		24,256	(10,343)
Balance at Mar. 31, 2020	269,959	$ 243	$ (284,108)	291,350	(29,790)	292,264
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	14,400					14,400
Currency translation adjustment	(770)				(770)
Shares issued for employee benefit plan and compensation (in shares)		13
Shares issued for employee benefit plan and compensation	212	$ 0		212
Purchase of treasury shares (in shares)			(3)
Purchase of treasury shares	(114)		$ (114)
Employee and director stock-based compensation	2,291			2,291
Performance-based common stock warrants	154			154
Balance (in shares) at Jun. 30, 2020		24,269	(10,346)
Balance at Jun. 30, 2020	286,132	$ 243	$ (284,222)	294,007	(30,560)	306,664
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	6,168					6,168
Currency translation adjustment	5,005				5,005
Shares issued for employee benefit plan and compensation (in shares)		15
Shares issued for employee benefit plan and compensation	220	$ 0		220
Purchase of treasury shares (in shares)			(91)
Purchase of treasury shares	(3,417)		$ (3,417)
Shares issued to directors (in shares)		9
Shares issued to directors	0	$ 0		0
Employee and director stock-based compensation	2,260			2,260
Performance-based common stock warrants	187			187
Balance (in shares) at Sep. 30, 2020		24,293	(10,437)
Balance at Sep. 30, 2020	$ 296,555	$ 243	$ (287,639)	$ 296,674	$ (25,555)	$ 312,832

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Cash provided by (used for) operating activities:
Net income (loss)	$ 26,414	$ (3,397)
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:
Depreciation and amortization	22,857	23,734
Provision for bad debts	271	275
Deferred income taxes	503	2,273
Shares issued for employee benefit plan	959	876
Employee and director stock-based compensation	6,854	6,718
Performance-based common stock warrants	525	1,381
Impairment of long-term assets	57	0
Accrued social insurance adjustment	(9,464)	0
Loss on sale of Ohio call center	712	0
Changes in operating assets and liabilities:
Accounts receivable and contract assets	11,556	(11,117)
Inventories	30,466	4,403
Prepaid expenses and other assets	601	5,507
Accounts payable and accrued liabilities	(50,507)	11,686
Accrued income taxes	2,023	(2,418)
Net cash provided by (used for) operating activities	43,827	39,921
Cash provided by (used for) investing activities:
Acquisitions of property, plant and equipment	(10,864)	(15,854)
Acquisitions of intangible assets	(5,254)	(1,505)
Payment on sale of Ohio call center	(500)	0
Net cash provided by (used for) investing activities	(16,618)	(17,359)
Cash provided by (used for) financing activities:
Borrowings under line of credit	70,000	57,500
Repayments on line of credit	(88,000)	(71,000)
Proceeds from stock options exercised	0	411
Treasury stock purchased	(9,822)	(1,741)
Contingent consideration payments in connection with business combinations	(3,091)	(4,251)
Net cash provided by (used for) financing activities	(30,913)	(19,081)
Effect of exchange rate changes on cash and cash equivalents	(3,452)	(1,959)
Net increase (decrease) in cash and cash equivalents	(7,156)	1,522
Cash and cash equivalents at beginning of period	74,302	53,207
Cash and cash equivalents at end of period	67,146	54,729
Supplemental cash flow information:
Income taxes paid	3,242	5,608
Interest paid	$ 1,404	$ 3,479

Basis of Presentation	9 Months Ended
Basis of Presentation	Sep. 30, 2020
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation In the opinion of management, the accompanying consolidated financial statements of Universal Electronics Inc. and its subsidiaries contain all the adjustments necessary for a fair presentation of financial position, results of operations and cash flows for the periods presented. All such adjustments are of a normal recurring nature and certain reclassifications have been made to prior year amounts in order to conform to the current year presentation. Information and footnote disclosures normally included in financial statements, which are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). As used herein, the terms "Company," "we," "us," and "our" refer to Universal Electronics Inc. and its subsidiaries, unless the context indicates to the contrary. Our results of operations for the three and nine months ended September 30, 2020 are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Quantitative and Qualitative Disclosures About Market Risk," and the "Financial Statements and Supplementary Data" included in Items 1A, 7, 7A, and 8, respectively, of our Annual Report on Form 10-K for the year ended December 31, 2019. Estimates, Judgments and Assumptions The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates and assumptions, including those related to revenue recognition; allowance for bad debts; inventory valuation; our review for impairment of long-lived assets, intangible assets and goodwill; leases; business combinations; income taxes; stock-based compensation expense and performance-based common stock warrants. The recent coronavirus ("COVID-19") pandemic and the mitigation efforts by governments to attempt to control its spread have created uncertainties and disruptions in the economic and financial markets. While we are not currently aware of events or circumstances that would require an update to our estimates, judgments or adjustments to the carrying values of our assets or liabilities, these estimates may change as developments occur and we obtain additional information. These future developments are highly uncertain and the outcomes are unpredictable. Actual results may differ from those estimates, and such differences may be material to the financial statements. See Note 2 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2019 for a summary of our significant accounting policies. Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-13, "Measurement of Credit Losses on Financial Instruments", which updates existing guidance for measuring and recording credit losses on financial assets measured at amortized cost by replacing the incurred loss impairment model with an expected loss impairment model. Accordingly, financial assets are presented at amortized costs net of an allowance for expected credit losses over the lifetime of the assets. We adopted this new guidance on January 1, 2020 using the modified retrospective method. The adoption did not require an implementation adjustment and did not materially impact our consolidated statement of financial position, results of operations and cash flows. See Note 3 for further discussion on our allowance for bad debts. In January 2017, the FASB issued ASU 2017-04, "Simplifying the Test for Goodwill Impairment", which simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to the reporting unit. Our adoption on January 1, 2020 did not have a material impact on our consolidated statement of financial position, results of operations and cash flows. In November 2019, the FASB issued ASU 2019-08, "Improvements - Share-based Consideration Payable to a Customer", which clarifies the accounting for share-based payments issued as sales incentives to customers. The guidance requires that stock-based compensation expense is recorded as a reduction in the transaction price on the basis of the grant-date fair value. The grant-date fair value is calculated using the provisions defined under Accounting Standards Codification "Stock Compensation". The transition provisions require that equity-classified awards be measured at the adoption date fair value if the measurement date has not been established prior to the adoption date. This guidance impacts the measurement date of our performance-based common stock warrants. The measurement periods for the first two successive two-year periods of our outstanding performance-based common stock warrants were completed prior to adoption and were not impacted by this updated guidance. The measurement period for the final two-year period began on January 1, 2020, and accordingly, we measured the fair value of the award as of our adoption date on January 1, 2020. We adopted this guidance using the modified retrospective method. Our adoption did not result in a cumulative adjustment in our consolidated statement of financial position. See Note 15 for further discussion on the performance-based common stock warrants. Recent Accounting Updates Not Yet Effective In December 2019, the FASB issued ASU 2019-12, "Simplifying the Accounting for Income Taxes", which, among other provisions, eliminates certain exceptions to existing guidance related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. This guidance also requires an entity to reflect the effect of an enacted change in tax laws or rates in its effective income tax rate in the first interim period that includes the enactment date of the new legislation, aligning the timing of recognition of the effects from enacted tax law changes on the effective income tax rate with the effects on deferred income tax assets and liabilities. Under existing guidance, an entity recognizes the effects of the enacted tax law change on the effective income tax rate in the period that includes the effective date of the tax law. The guidance is effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. We are currently evaluating the impact of this guidance on our consolidated statement of financial position, results of operations and cash flows.

Cash and Cash Equivalents

9 Months Ended

Sep. 30, 2020

Cash and Cash Equivalents [Abstract]

Cash and Cash Equivalents

Cash and cash equivalents were held in the following geographic regions:


(In thousands)	September 30, 2020		December 31, 2019
North America	$	14,693	$	16,751
People's Republic of China ("PRC")	15,054		13,700
Asia (excluding the PRC)	12,291		21,691
Europe	16,802		9,081
South America	8,306		13,079
Total cash and cash equivalents	$	67,146	$	74,302

Revenue and Accounts Receivable, Net

9 Months Ended

Sep. 30, 2020

Receivables [Abstract]

Revenue and Accounts Receivable, Net

Revenue Details

The pattern of revenue recognition was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
Goods and services transferred at a point in time	$	127,657	$	152,453	$	365,902	$	429,461
Goods and services transferred over time	25,848		48,271		92,514		149,322
Net sales	$	153,505	$	200,724	$	458,416	$	578,783

Our net sales to external customers by geographic area were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
United States	$	64,367	$	107,546	$	203,981	$	313,029
Asia (excluding PRC)	27,923		29,613		86,043		79,157
Europe	26,119		23,388		72,625		69,510
People's Republic of China	25,625		23,704		63,653		66,465
Latin America	4,546		8,281		12,652		26,187
Other	4,925		8,192		19,462		24,435
Total net sales	$	153,505	$	200,724	$	458,416	$	578,783

Specific identification of the customer billing location was the basis used for attributing revenues from external customers to geographic areas.

Net sales to the following customers totaled more than 10% of our net sales:


	Three Months Ended September 30,
	2020						2019
	$ (thousands)			% of Net Sales			$ (thousands)			% of Net Sales
Comcast Corporation	$	32,533		21.2	%		$	30,419		15.2	%

Sony Corporation	$	15,927		10.4	%		—		(1)	—		(1)
Ring L.L.C.	—		(1)	—		(1)	$	21,050		10.5	%


	Nine Months Ended September 30,
	2020				2019
	$ (thousands)		% of Net Sales		$ (thousands)		% of Net Sales
Comcast Corporation	$	95,014	20.7	%	$	91,058	15.7	%

(1)Net sales to this customer did not total more than 10% of our total net sales in the indicated period.

Accounts Receivable, Net

Accounts receivable, net were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Trade receivables, gross	$	122,882	$	130,888
Allowance for bad debts	(1,797)		(1,492)
Allowance for sales returns	(618)		(623)
Net trade receivables	120,467		128,773
Other	7,627		10,425
Accounts receivable, net	$	128,094	$	139,198

Allowance for Bad Debts

Changes in the allowance for bad debts were as follows:


(In thousands)	Nine Months Ended September 30,
	2020		2019
Balance at beginning of period	$	1,492	$	1,121
Additions to costs and expenses	271		275
Write-offs/Foreign exchange effects	34		(104)
Balance at end of period	$	1,797	$	1,292

Trade receivables associated with these significant customers that totaled more than 10% of our accounts receivable, net were as follows:


	September 30, 2020						December 31, 2019
	$ (thousands)			% of Accounts Receivable, Net			$ (thousands)			% of Accounts Receivable, Net
Comcast Corporation	$	25,390		19.8	%		—		(1)	—		(1)
DISH Network Corporation	—		(1)	—		(1)	$	14,677		10.5	%

(1)Trade receivables associated with this customer did not total more than 10% of our accounts receivable, net at the dates set forth.

Inventories and Significant Suppliers

9 Months Ended

Sep. 30, 2020

Inventory Disclosure [Abstract]

Inventories and Significant Suppliers

Inventories were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Raw materials	$	36,784	$	56,352
Components	17,215		24,599
Work in process	4,075		1,526
Finished goods	57,676		62,658
Inventories	$	115,750	$	145,135

Significant Suppliers

We purchase integrated circuits, components and finished goods from multiple sources. Purchases from the following supplier totaled more than 10% of our total inventory purchases:


	Three Months Ended September 30,
	2020				2019
	$ (thousands)		% of Total Inventory Purchases		$ (thousands)		% of Total Inventory Purchases
Qorvo International Pte Ltd.	$	8,472	13.0	%	—	(1)	—	(1)


	Nine Months Ended September 30,
	2020				2019
	$ (thousands)		% of Total Inventory Purchases		$ (thousands)		% of Total Inventory Purchases
Qorvo International Pte Ltd.	$	29,679	13.4	%	—	(1)	—	(1)

(1)Purchases associated with this supplier did not total more than 10% of our total inventory purchases for the indicated period

The supplier that totaled more than 10% of our accounts payable, was as follows:


	September 30, 2020				December 31, 2019
	$ (thousands)		% of Accounts Payable		$ (thousands)		% of Accounts Payable
Zhejiang Zhen You Electronics Co. Ltd.	—	(1)	—	(1)	$	11,394	11.1	%

(1)Accounts payable associated with this supplier did not total more than 10% of our accounts payable at the dates set forth.

Leases

9 Months Ended

Sep. 30, 2020

Leases [Abstract]

Leases

We have entered into various operating lease agreements for automobiles, offices and manufacturing facilities throughout the world. At September 30, 2020, our operating leases had remaining lease terms of up to 40 years.

Lease balances within our consolidated balance sheet were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Assets:
Operating lease right-of-use assets	$	18,678	$	19,826
Liabilities:
Other accrued liabilities	$	5,802	$	4,903
Long-term operating lease obligations	13,284		15,639
Total lease liabilities	$	19,086	$	20,542

Operating lease expense, including variable and short-term lease costs which were insignificant to the total, operating lease cash flows and supplemental cash flow information were as follows:


(In thousands)	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Cost of sales	$	513	$	574	$	1,285	$	1,627
Selling, general and administrative expenses	976		1,036		2,994		3,324
Total operating lease expense	$	1,489	$	1,610	$	4,279	$	4,951
Operating cash outflows from operating leases	$	1,617	$	1,537	$	4,685	$	5,197
Operating lease right-of-use assets obtained in exchange for lease obligations	$	1,935	$	1,131	$	2,121	$	2,655

The weighted average remaining lease liability term and the weighted average discount rate were as follows:


	September 30, 2020		December 31, 2019
Weighted average lease liability term (in years)	3.8		4.3
Weighted average discount rate	4.18	%	4.50	%

The following table reconciles the undiscounted cash flows for each of the first five years and thereafter to the operating lease liabilities recognized in our consolidated balance sheet at September 30, 2020. The reconciliation excludes short-term leases that are not recorded on the balance sheet.


(In thousands)	September 30, 2020
2020 (remaining 3 months)	$	1,462
2021	6,671
2022	5,671
2023	2,835
2024	1,765
Thereafter	2,281
Total lease payments	20,685
Less: imputed interest	(1,599)
Total lease liabilities	$	19,086

At September 30, 2020, we had one operating lease with a five-year term that had not yet commenced. The total initial lease liability, which is immaterial to the balance sheet, is not reflected within the above maturity schedule.

Goodwill and Intangible Assets, Net

9 Months Ended

Sep. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets, Net

Goodwill

Changes in the carrying amount of goodwill were as follows:


(In thousands)
Balance at December 31, 2019	$	48,447
Foreign exchange effects	79
Balance at September 30, 2020	$	48,526

Intangible Assets, Net

The components of intangible assets, net were as follows:


	September 30, 2020						December 31, 2019
(In thousands)	Gross (1)		Accumulated Amortization (1)		Net		Gross (1)		Accumulated Amortization (1)		Net
Distribution rights	$	336	$	(241)	$	95	$	322	$	(210)	$	112
Patents	20,962		(7,294)		13,668		16,587		(6,491)		10,096
Trademarks and trade names	2,786		(2,435)		351		2,785		(2,205)		580
Developed and core technology	4,080		(2,971)		1,109		12,480		(10,016)		2,464
Capitalized software development costs	254		—		254		—		—		—
Customer relationships	31,233		(27,093)		4,140		32,534		(25,956)		6,578
Total intangible assets, net	$	59,651	$	(40,034)	$	19,617	$	64,708	$	(44,878)	$	19,830

(1)This table excludes the gross value of fully amortized intangible assets totaling $17.6 million and $7.4 million at September 30, 2020 and December 31, 2019, respectively.

Amortization expense, which was recognized in selling, general and administrative expenses, was $1.8 million and $1.8 million during the three months ended September 30, 2020 and 2019, respectively. Amortization expense, which was recognized in selling, general and administrative expenses, was $5.5 million and $5.4 million during the nine months ended September 30, 2020 and 2019, respectively.

Estimated future annual amortization expense related to our intangible assets at September 30, 2020, was as follows:


(In thousands)
2020 (remaining 3 months)	$	1,037
2021	3,391
2022	3,263
2023	2,999
2024	2,418
Thereafter	6,509
Total	$	19,617

Line of Credit	9 Months Ended
Line of Credit	Sep. 30, 2020
Debt Disclosure [Abstract]
Line of Credit	Line of Credit Our Second Amended and Restated Credit Agreement ("Second Amended Credit Agreement") with U.S. Bank National Association ("U.S. Bank") provides for a $125.0 million revolving line of credit ("Credit Line") that expires on November 1, 2021. The Credit Line may be used for working capital and other general corporate purposes including acquisitions, share repurchases and capital expenditures. Amounts available for borrowing under the Credit Line are reduced by the balance of any outstanding letters of credit, of which there were $2.7 million at September 30, 2020. All obligations under the Credit Line are secured by substantially all of our U.S. personal property and tangible and intangible assets as well as 65% of our ownership interest in Enson Assets Limited, our wholly-owned subsidiary which controls our manufacturing factories in the PRC. Under the Second Amended Credit Agreement, we may elect to pay interest on the Credit Line based on LIBOR plus an applicable margin (varying from 1.25% to 1.75%) or base rate (based on the prime rate of U.S. Bank or as otherwise specified in the Second Amended Credit Agreement) plus an applicable margin (varying from 0.00% to 0.50%). The applicable margins are calculated quarterly and vary based on our cash flow leverage ratio as set forth in the Second Amended Credit Agreement. The interest rate in effect at September 30, 2020 was 1.39%. There are no commitment fees or unused line fees under the Second Amended Credit Agreement. The Second Amended Credit Agreement includes financial covenants requiring a minimum fixed charge coverage ratio and a maximum cash flow leverage ratio. In addition, the Second Amended Credit Agreement contains other customary affirmative and negative covenants and events of default. At September 30, 2020, we were in compliance with the covenants and conditions of the Second Amended Credit Agreement. At September 30, 2020, we had $50.0 million outstanding under the Credit Line. Our total interest expense on borrowings was $0.3 million and $0.9 million during the three months ended September 30, 2020 and 2019, respectively. Our total interest expense on borrowings was $1.4 million and $3.4 million during the nine months ended September 30, 2020 and 2019, respectively.

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2020
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes We utilize our estimated annual effective tax rate to determine our provision for income taxes for interim periods. The income tax provision is computed by taking the estimated annual effective rate and multiplying it by the year-to-date pre-tax book income. We recorded income tax expense of $2.2 million and $2.5 million for the three months ended September 30, 2020 and 2019, respectively. We recorded income tax expense of $5.3 million and $3.7 million for the nine months ended September 30, 2020 and 2019, respectively. The income tax expense for the nine months ended September 30, 2020 increased primarily due to an increase in global pre-tax income and the mix of pre-tax income among jurisdictions, including losses not benefited as a result of a valuation allowance. At December 31, 2019, we assessed the realizability of our deferred tax assets by considering whether it is "more likely than not" some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. We considered taxable income in carryback years, the scheduled reversal of deferred tax liabilities, tax planning strategies and projected future taxable income in making this assessment. At December 31, 2019, we had a three-year cumulative operating loss for our U.S. operations and accordingly, have provided a full valuation allowance on our U.S. federal and state deferred tax assets. During the nine months ended September 30, 2020, there was no change to our valuation allowance position. At September 30, 2020, we had gross unrecognized tax benefits of $3.1 million, including interest and penalties, of which approximately $3.1 million of this amount, if not for the state Research and Experimentation income tax credit valuation allowance, would affect the annual effective tax rate if these tax benefits are realized. Further, we are unaware of any positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly increase within the next twelve months. However, based on federal, state and foreign statute expirations in various jurisdictions, we anticipate a decrease in unrecognized tax benefits of approximately $0.2 million within the next twelve months based on federal, state, and foreign statute expirations in various jurisdictions. We have classified uncertain tax positions as non-current income tax liabilities unless they are expected to be paid within one year. We have elected to classify interest and penalties as a component of tax expense. Accrued interest and penalties of $0.2 million at September 30, 2020 and $0.2 million at December 31, 2019 are included in the unrecognized tax benefits. On March 18, 2020 and March 27, 2020, the Families First Coronavirus Response ("FFCR") Act and the Coronavirus Aid, Relief and Economic Security ("CARES") Act, respectively, were enacted in response to the COVID-19 pandemic. The FFCR Act and the CARES Act contain numerous income tax provisions, such as relaxing limitations on the deductibility of interest and the use of net operating losses arising in taxable years beginning after December 31, 2017. We are currently evaluating the impact of this legislation on our consolidated financial position, results of operations, and cash flows. Future regulatory guidance under the FFCR and CARES Acts (as well as under the Tax Cuts and Jobs Act) remains forthcoming and such guidance may ultimately increase or decrease their impact on our business and financial condition. It is also possible that Congress will enact additional legislation in connection with the COVID-19 pandemic, some of which may impact us. In April 2020, recent interpretations of a German law relating to withholding taxes on intellectual property rights emerged. We are currently evaluating this law and any related impact to our financial position and results of operations.

- 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

Accrued Compensation

9 Months Ended

Sep. 30, 2020

Payables and Accruals [Abstract]

Accrued Compensation

In June 2018, we sold our Guangzhou entity via a stock deal and the terms of the agreement included a two-year indemnification period. In June 2020, the indemnification period expired and we determined we were no longer legally liable for any liabilities associated with our Guangzhou entity. Accordingly, we reversed the accrued social insurance by the amount associated with the Guangzhou entity, which was approximately $9.5 million.

The components of accrued compensation were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Accrued social insurance (1)	$	7,150	$	16,588
Accrued salary/wages	6,606		7,465
Accrued vacation/holiday	3,046		2,766
Accrued bonus	3,750		13,965
Accrued commission	954		1,283
Other accrued compensation	1,384		1,601
Total accrued compensation	$	22,890	$	43,668

(1)PRC employers are required by law to remit the applicable social insurance payments to their local government. Social insurance is comprised of various components such as pension, medical insurance, job industry insurance, unemployment insurance, and a housing assistance fund, and is administered in a manner similar to social security in the United States. This amount represents our estimate of the amounts due to the PRC government for social insurance at September 30, 2020 and December 31, 2019.

Other Accrued Liabilities

The components of other accrued liabilities were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Contract liabilities	$	2,207	$	1,840
Duties	4,607		3,731
Freight and handling fees	2,503		3,769
Operating lease obligations	5,802		4,903
Product warranty claims costs	1,797		1,514
Professional fees	4,301		2,833
Sales and value added taxes	4,217		3,926
Short-term contingent consideration	1,780		5,428
Other	6,402		7,501
Total other accrued liabilities	$	33,616	$	35,445

Other Accrued Liabilities

9 Months Ended

Sep. 30, 2020

Payables and Accruals [Abstract]

Other Accrued Liabilities

Accrued Compensation

The components of accrued compensation were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Accrued social insurance (1)	$	7,150	$	16,588
Accrued salary/wages	6,606		7,465
Accrued vacation/holiday	3,046		2,766
Accrued bonus	3,750		13,965
Accrued commission	954		1,283
Other accrued compensation	1,384		1,601
Total accrued compensation	$	22,890	$	43,668

Other Accrued Liabilities

The components of other accrued liabilities were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Contract liabilities	$	2,207	$	1,840
Duties	4,607		3,731
Freight and handling fees	2,503		3,769
Operating lease obligations	5,802		4,903
Product warranty claims costs	1,797		1,514
Professional fees	4,301		2,833
Sales and value added taxes	4,217		3,926
Short-term contingent consideration	1,780		5,428
Other	6,402		7,501
Total other accrued liabilities	$	33,616	$	35,445

Commitments and Contingencies

9 Months Ended

Sep. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Product Warranties

Changes in the liability for product warranty claims costs were as follows:


(In thousands)	Nine Months Ended September 30,
	2020		2019
Balance at beginning of period	$	1,514	$	276
Accruals for warranties issued during the period	578		695
Settlements (in cash or in kind) during the period/Foreign exchange effects	(295)		—
Balance at end of period	$	1,797	$	971

Litigation

Roku Matters

2018 Lawsuit

On September 5, 2018, we filed a lawsuit against Roku, Inc. ("Roku") in the United States District Court, Central District of California, alleging that Roku is willfully infringing nine of our patents that are in four patent families related to remote control set-up and touchscreen remotes. On December 5, 2018, we amended our complaint to add additional details supporting our infringement and willfulness allegations. We have alleged that this complaint relates to multiple Roku streaming players and components therefore and certain universal control devices, including but not limited to the Roku App, Roku TV, Roku Express, Roku Streaming Stick, Roku Ultra, Roku Premiere, Roku 4, Roku 3, Roku 2, Roku Enhanced Remote and any other Roku product that provides for the remote control of an external device such as a TV, audiovisual receiver, sound bar or Roku TV Wireless Speakers. In October 2019, the Court stayed this lawsuit pending action by the Patent Trial and Appeals Board (the "PTAB") with respect to Roku's Inter Partes Review requests (see discussion below).

International Trade Commission Investigation of Roku, TCL, Hisense and Funai

On April 16, 2020, we filed a complaint with the International Trade Commission (the "ITC") against Roku, TCL Electronics Holding Limited and related entities (collectively, "TCL"), Hisense Co., Ltd. and related entities (collectively, "Hisense"), and Funai Electric Company, Ltd. and related entities (collectively, "Funai") claiming that certain of their televisions, set-top boxes, remote control devices, human interface devices, streaming devices, and sound bars infringe certain of our patents. We asked the ITC to issue a permanent limited exclusion order prohibiting the importation of these infringing products into the United States and a cease and desist order to stop these parties from continuing their infringing activities. On May 18, 2020, the ITC announced that it instituted its investigation as requested by us. We are in the discovery phase of this investigation which is set to end in early November 2020.

Inter Partes Reviews

In September and October 2019, Roku filed Inter Partes Review ("IPR") requests with the PTAB on the nine patents at issue in the 2018 Lawsuit (see discussion above). To date, the PTAB has denied Roku's request with respect to three of the nine patents and granted Roku's request with respect to six of the nine patents. As for those IPRs for which the PTAB granted Roku's request for review, we will vigorously defend our patents. In May and June 2020, Roku filed four IPR requests against three patents asserted in the ITC investigation. UEI has responded to these requests and we are awaiting the PTAB decision in early to mid 2021.

Federal District Court Actions against each of Roku, TCL, Hisense, and Funai related to the ITC Matter

On April 9, 2020, we filed separate actions against each of Roku, TCL, Hisense, and Funai in the United States District Court, Central District of California, alleging that Roku is willfully infringing five of our patents and TCL, Hisense, and Funai are willfully infringing six of our patents by incorporating our patented technology into certain of their televisions, set-top boxes, remote control devices, human interface devices, streaming devices, and sound bars. These matters have been stayed pending the results of the ITC investigation mentioned above.

Court of International Trade Action against the United States of America, et. al.

On October 9, 2020, Universal Electronics Inc. ("UEI") and our subsidiaries, Ecolink Intelligent Technology, Inc. ("Ecolink") and RCS Technology, LLC ("RCS") filed an amended complaint (20-cv-00670) in the Court of International Trade (the "CIT") against the United States of America; the Office of the United States Trade Representative; Robert E. Lighthizer, U.S. Trade Representative; U.S. Customs & Border Protection; and Mark A. Morgan, U.S. Customs & Border Protection Acting Commissioner, challenging both the substantive and procedural processes followed by the United States Trade Representative ("USTR") when instituting Section 301 Tariffs on imports from China under Lists 3 and 4A.

By this complaint, UEI, Ecolink and RCS are alleging that USTR's institution of Lists 3 and 4A tariffs violated the Trade Act of 1974 (the "Trade Act") on the grounds that the USTR failed to make a determination or finding that there was an unfair trade practice that required a remedy and moreover, that Lists 3 and 4A tariffs were instituted beyond the 12-month time limit provided for in the governing statute. UEI, Ecolink and RCS also allege that the manner in which the Lists 3 and 4A tariff actions were implemented violated the Administrative Procedures Act (the "APA") by failing to provide adequate opportunity for comments, failed to consider relevant factors when making its decision and failed to connect the record facts to the choices it made by not explaining how the comments received by USTR came to shape the final implementation of Lists 3 and 4A.

UEI, Ecolink and RCS are asking the CIT to declare that Defendants' actions resulting in the tariffs on products covered by Lists 3 and 4A are unauthorized by and contrary to the Trade Act and was arbitrarily and unlawfully promulgated in violation of the APA; to vacate the Lists 3 and 4A tariffs; to order a refund (with interest) of any Lists 3 and 4A duties paid by UEI, Ecolink and RCS; to permanently enjoin the U.S. government from applying Lists 3 and 4A duties against UEI, Ecolink and RCS; and award UEI, Ecolink and RCS their costs and reasonable attorney fees.

The Government has requested an automatic stay of all pending cases challenging the List 3 and List 4A tariffs except for one or more "test cases." It proposed the first-filed case—the case filed by HMTX—as the test case. The government also asked the court to appoint a "steering committee" consisting of several lead counsel for the plaintiffs to direct the litigation. The government proposed a bifurcated briefing schedule, under which the parties would first brief the government's upcoming motion to dismiss before briefing the merits of plaintiffs' claims. We will agree to a stay in our case. HMTX has filed a response agreeing to the stay and to being the test case but opposed the Government's proposed briefing schedule.

There are no other material pending legal proceedings to which we or any of our subsidiaries is a party or of which our respective property is the subject. However, as is typical in our industry and to the nature and kind of business in which we are engaged, from time to time, various claims, charges and litigation are asserted or commenced by third parties against us or by us against third parties arising from or related to product liability, infringement of patent or other intellectual property rights, breach of warranty, contractual relations, or employee relations. The amounts claimed may be substantial, but may not bear any reasonable relationship to the merits of the claims or the extent of any real risk of court awards assessed against us or in our favor. However, no assurances can be made as to the outcome of any of these matters, nor can we estimate the range of potential losses to us. In our opinion, final judgments, if any, which might be rendered against us in potential or pending litigation would not have a material adverse effect on our consolidated financial condition, results of operations, or cash flows. Moreover, we believe that our products do not infringe any third parties' patents or other intellectual property rights.

We maintain directors' and officers' liability insurance, which insures our individual directors and officers against certain claims, as well as attorney's fees and related expenses incurred in connection with the defense of such claims.

Treasury Stock

9 Months Ended

Sep. 30, 2020

Equity [Abstract]

Treasury Stock

Treasury StockFrom time to time, our Board of Directors authorizes management to repurchase shares of our issued and outstanding common stock. On September 15, 2020, our Board of Directors authorized a share repurchase program (the "September 2020 Program"), which replaced in its entirety the previous repurchase program. Pursuant to the September 2020 Program, we may repurchase up to 300,000 shares of our common stock. At September 30, 2020, we had 213,075 shares of common stock authorized for repurchase remaining under the September 2020 Program. Subsequent to September 30, 2020, we repurchased an additional 113,075 shares under the September 2020 Program at a cost of $4.4 million. On October 28, 2020, our Board terminated the September 2020 Program and replaced it with a new share repurchase program with an effective date of November 10, 2020 (the "November 2020 Program"). Pursuant to the November 2020 Program, we may, from time to time until February 18, 2021, repurchase up to 500,000 shares of our common stock. We may repurchase shares of common stock in privately negotiated and/or open-market transactions, including pursuant to plans complying with Rule 10b5-1 promulgated under the Securities Exchange Act of 1934.

Repurchased shares of our common stock were as follows:


	Nine Months Ended September 30,
(In thousands)	2020		2019
Shares repurchased	263		55
Cost of shares repurchased	$	9,822	$	1,741

Repurchased shares are recorded as shares held in treasury at cost. We hold these shares for future use as management and the Board of Directors deem appropriate.

Long-lived Tangible Assets

9 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Long-lived Tangible Assets

Long-lived tangible assets by geographic area, which include property, plant, and equipment, net and operating lease right-of-use assets, were as follows:


(In thousands)	September 30, 2020		December 31, 2019
United States	$	16,327	$	19,938
People's Republic of China	61,320		67,625
Mexico	20,624		16,644
All other countries	4,956		6,351
Total long-lived tangible assets	$	103,227	$	110,558

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

Stock-Based Compensation

9 Months Ended

Sep. 30, 2020

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

Stock-based compensation expense for each employee and director is presented in the same statement of operations caption as their cash compensation. Stock-based compensation expense by statement of operations caption and the related income tax benefit were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
Cost of sales	$	36	$	37	$	146	$	102
Research and development expenses	287		315		811		809
Selling, general and administrative expenses:
Employees	1,555		1,866		4,695		5,005
Outside directors	382		309		1,202		802
Total employee and director stock-based compensation expense	$	2,260	$	2,527	$	6,854	$	6,718

Income tax benefit	$	494	$	509	$	1,500	$	1,385

Stock Options

Stock option activity was as follows:


	Number of Options (in thousands)	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2019	745	$	41.73
Granted	109	46.17
Exercised	—	—			$	—
Forfeited/canceled/expired	—	—
Outstanding at September 30, 2020 (1)	854	$	42.29	3.63	$	3,853
Vested and expected to vest at September 30, 2020 (1)	854	$	42.29	3.63	$	3,853
Exercisable at September 30, 2020 (1)	634	$	43.04	2.75	$	3,048

(1)The aggregate intrinsic value represents the total pre-tax value (the difference between our closing stock price on the last trading day of the third quarter of 2020 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had they all exercised their options on September 30, 2020. This amount will change based on the fair market value of our stock.

The assumptions we utilized in the Black-Scholes option pricing model and the resulting weighted average fair value of stock option grants were the following:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2020			2019			2020			2019
Weighted average fair value of grants	$	—		$	—		$	17.70		$	10.28
Risk-free interest rate	—		%	—		%	1.44		%	2.49		%
Expected volatility	—		%	—		%	43.95		%	41.64		%
Expected life in years	0.00			0.00			4.59			4.54

As of September 30, 2020, we expect to recognize $2.7 million of total unrecognized pre-tax stock-based compensation expense related to non-vested stock options over a remaining weighted-average life of 1.9 years.

Restricted Stock

Non-vested restricted stock award activity was as follows:


	Shares (in thousands)	Weighted-Average Grant Date Fair Value
Non-vested at December 31, 2019	310	$	34.99
Granted	235	36.83
Vested	(150)	38.09
Forfeited	(6)	44.31
Non-vested at September 30, 2020	389	$	34.75

As of September 30, 2020, we expect to recognize $10.2 million of total unrecognized pre-tax stock-based compensation expense related to non-vested restricted stock awards over a weighted-average life of 1.9 years.

Performance-Based Common Stock Warrants

9 Months Ended

Sep. 30, 2020

Equity [Abstract]

Performance-Based Common Stock Warrants

On March 9, 2016, we issued common stock purchase warrants to Comcast Corporation ("Comcast") to purchase up to 725,000 shares of our common stock at a price of $54.55 per share. The right to exercise the warrants is subject to vesting over three successive two-year periods (with the first two-year period commencing on January 1, 2016) based on the level of purchases of goods and services from us by Comcast and its affiliates, as defined in the warrants. The table below presents the purchase levels and potential number of warrants to vest in each period based upon achieving the purchase levels.


	Potential Warrants To Vest
Aggregate Level of Purchases by Comcast and Affiliates	January 1, 2016 - December 31, 2017	January 1, 2018 - December 31, 2019	January 1, 2020 - December 31, 2021
$260 million	100,000	100,000	75,000
$300 million	75,000	75,000	75,000
$340 million	75,000	75,000	75,000
Maximum Potential Warrants Earned by Comcast	250,000	250,000	225,000

If total aggregate purchases by Comcast and its affiliates are below $260 million in any of the two-year periods above, no warrants will vest related to that two-year period. If total aggregate purchases of goods and services by Comcast and its affiliates exceed $340 million during either the first or second two-year period, the amount of any such excess would count toward aggregate purchases in the following two-year period. This threshold was not met in either the first or second two-year period. For the two-year period ended December 31, 2017, Comcast earned and vested in 175,000 out of the maximum potential 250,000 warrants. For the two-year period ended December 31, 2019, Comcast earned and vested in 100,000 out of the maximum potential 250,000 warrants. At September 30, 2020, 275,000 vested warrants were outstanding. To fully vest in the rights to purchase all of the remaining unearned 225,000 underlying shares, Comcast and its affiliates must purchase an aggregate of $340 million in goods and services from us during the period January 1, 2020 through December 31, 2021.

All warrants that vest will expire on January 1, 2023. The warrants provide for certain adjustments that may be made to the exercise price and the number of shares issuable upon exercise due to customary anti-dilution provisions. Additionally, in connection with the common stock purchase warrants, we have also entered into a registration rights agreement with Comcast under which Comcast may from time to time request that we register the shares of common stock underlying vested warrants with the SEC.

As the warrants contain performance criteria under which Comcast must achieve specified aggregate purchase levels for the warrants to vest, as detailed above, the measurement date for the warrants for the first two-year successive periods was the date on which the warrants vested.

The FASB issued guidance in November 2019 that clarifies the accounting for share-based payments issued as sales incentives to customers. The guidance requires that stock-based compensation expense be recorded as a reduction in the transaction price on the basis of the grant-date fair value. The transition provisions require that equity-classified awards be measured at the adoption date fair value if the measurement date has not been established prior to the adoption date. The measurement periods for the first two successive two-year periods of our outstanding performance-based common stock warrants were completed prior to adoption and were not impacted by this updated guidance. The measurement period for the final two-year period began on January 1, 2020, and, accordingly, we measured the fair value of the award as of our adoption date on January 1, 2020 using the Black-Scholes option pricing model. Through September 30, 2020, none of the warrants had vested for the two-year period beginning January 1, 2020.

The assumptions we utilized in the Black-Scholes option pricing model and the resulting grant-date fair value of the warrants as of January 1, 2020 were the following:


Fair value	$	17.19
Price of Universal Electronics Inc. common stock	$	52.21
Risk-free interest rate	1.62		%
Expected volatility	48.86		%
Expected life in years	3.00

Prior to the adoption of the new guidance on January 1, 2020, we adjusted the estimated weighted average fair value of the warrants each period. The assumptions we utilized in the Black-Scholes option pricing model and the resulting weighted average fair value of the warrants were the following:


	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Fair value	$	16.78		$	16.78
Price of Universal Electronics Inc. common stock	$	51.09		$	51.09
Risk-free interest rate	1.56		%	1.56		%
Expected volatility	47.82		%	47.82		%
Expected life in years	3.25			3.25

The impact to net sales recorded in connection with the warrants and the related income tax benefit were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
Reduction to net sales	$	187	$	711	$	525	$	1,381
Income tax benefit	$	47	$	177	$	131	$	345

We estimate the number of warrants that will vest based on projected future purchases that will be made by Comcast and its affiliates. These estimates may increase or decrease based on actual future purchases. The aggregate estimated fair value of the warrants is recognized as a reduction to revenue over the related two-year vesting period. At September 30, 2020, the aggregate unrecognized estimated fair value of warrants we estimate will vest was $0.8 million.

Other Income (Expense), Net

9 Months Ended

Sep. 30, 2020

Other Income and Expenses [Abstract]

Other Income (Expense), Net

Other income (expense), net consisted of the following:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
Net gain (loss) on foreign currency exchange contracts (1)	$	(72)	$	368	$	(523)	$	(8)
Net gain (loss) on foreign currency exchange transactions	(1,525)		(689)		(865)		(662)
Other income	(49)		173		125		244
Other (expense), net	$	(1,646)	$	(148)	$	(1,263)	$	(426)

(1)This represents the gains (losses) incurred on foreign currency hedging derivatives (see Note 18 for further details).

Earnings (Loss) Per Share

9 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Earnings (Loss) Per Share

Earnings (loss) per share was calculated as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands, except per-share amounts)	2020		2019		2020		2019
BASIC
Net income (loss)	$	6,168	$	2,669	$	26,414	$	(3,397)
Weighted-average common shares outstanding	13,928		13,894		13,935		13,861
Basic earnings (loss) per share	$	0.44	$	0.19	$	1.90	$	(0.25)

DILUTED
Net income (loss)	$	6,168	$	2,669	$	26,414	$	(3,397)
Weighted-average common shares outstanding for basic	13,928		13,894		13,935		13,861
Dilutive effect of stock options, restricted stock and common stock warrants	277		276		254		—
Weighted-average common shares outstanding on a diluted basis	14,205		14,170		14,189		13,861
Diluted earnings (loss) per share	$	0.43	$	0.19	$	1.86	$	(0.25)

The following number of stock options, shares of restricted stock and common stock warrants were excluded from the computation of diluted earnings per common share as their inclusion would have been anti-dilutive:


	Three Months Ended September 30,		Nine Months Ended September 30,
(In thousands)	2020	2019	2020	2019
Stock options	511	382	494	436
Restricted stock awards	—	9	18	89
Performance-based warrants	275	175	275	175

Derivatives

9 Months Ended

Sep. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

The following table sets forth the total net fair value of derivatives:


	September 30, 2020								December 31, 2019
	Fair Value Measurement Using						Total Balance		Fair Value Measurement Using						Total Balance
(In thousands)	Level 1		Level 2		Level 3				Level 1		Level 2		Level 3
Foreign currency exchange contracts	$	—	$	153	$	—	$	153	$	—	$	(172)	$	—	$	(172)

We held foreign currency exchange contracts, which resulted in a net pre-tax loss of $0.1 million and a net pre-tax gain of $0.4 million for the three months ended September 30, 2020 and 2019, respectively. For the nine months ended September 30, 2020 and 2019, we had a net pre-tax loss of $0.5 million and $8.0 thousand, respectively (see Note 16).

Details of foreign currency exchange contracts held were as follows:


Date Held	Currency	Position Held	Notional Value (in millions)		Forward Rate	Unrealized Gain/(Loss) Recorded at Balance Sheet Date (in thousands)(1)		Settlement Date
September 30, 2020	USD/Chinese Yuan Renminbi	CNY	$	37.0	6.8297	$	210	October 30, 2020
September 30, 2020	USD/Euro	USD	$	26.0	1.1685	$	(87)	October 30, 2020
September 30, 2020	USD/Brazilian Real	USD	$	1.5	5.5368	$	24	October 30, 2020
September 30, 2020	USD/Mexican Peso	USD	$	2.6	22.1285	$	6	October 30, 2020
December 31, 2019	USD/Chinese Yuan Renminbi	USD	$	35.0	6.9867	$	100	January 23, 2020
December 31, 2019	USD/Brazilian Real	USD	$	0.5	4.0560	$	(6)	January 24, 2020
December 31, 2019	USD/Euro	USD	$	28.0	1.1133	$	(253)	January 24, 2020
December 31, 2019	USD/Brazilian Real	USD	$	0.7	4.0870	$	(13)	January 24, 2020

(1)Unrealized gains on foreign currency exchange contracts are recorded in prepaid expenses and other current assets. Unrealized losses on foreign currency exchange contracts are recorded in other accrued liabilities.

Basis of Presentation (Policies)	9 Months Ended
Basis of Presentation (Policies)	Sep. 30, 2020
Accounting Policies [Abstract]
Basis of Presentation	In the opinion of management, the accompanying consolidated financial statements of Universal Electronics Inc. and its subsidiaries contain all the adjustments necessary for a fair presentation of financial position, results of operations and cash flows for the periods presented. All such adjustments are of a normal recurring nature and certain reclassifications have been made to prior year amounts in order to conform to the current year presentation. Information and footnote disclosures normally included in financial statements, which are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). As used herein, the terms "Company," "we," "us," and "our" refer to Universal Electronics Inc. and its subsidiaries, unless the context indicates to the contrary.
Estimates, Judgments and Assumptions	The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates and assumptions, including those related to revenue recognition; allowance for bad debts; inventory valuation; our review for impairment of long-lived assets, intangible assets and goodwill; leases; business combinations; income taxes; stock-based compensation expense and performance-based common stock warrants.
Recently Adopted Accounting Pronouncements and Recent Accounting Updates Note Yet Effective	Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-13, "Measurement of Credit Losses on Financial Instruments", which updates existing guidance for measuring and recording credit losses on financial assets measured at amortized cost by replacing the incurred loss impairment model with an expected loss impairment model. Accordingly, financial assets are presented at amortized costs net of an allowance for expected credit losses over the lifetime of the assets. We adopted this new guidance on January 1, 2020 using the modified retrospective method. The adoption did not require an implementation adjustment and did not materially impact our consolidated statement of financial position, results of operations and cash flows. See Note 3 for further discussion on our allowance for bad debts. In January 2017, the FASB issued ASU 2017-04, "Simplifying the Test for Goodwill Impairment", which simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to the reporting unit. Our adoption on January 1, 2020 did not have a material impact on our consolidated statement of financial position, results of operations and cash flows. In November 2019, the FASB issued ASU 2019-08, "Improvements - Share-based Consideration Payable to a Customer", which clarifies the accounting for share-based payments issued as sales incentives to customers. The guidance requires that stock-based compensation expense is recorded as a reduction in the transaction price on the basis of the grant-date fair value. The grant-date fair value is calculated using the provisions defined under Accounting Standards Codification "Stock Compensation". The transition provisions require that equity-classified awards be measured at the adoption date fair value if the measurement date has not been established prior to the adoption date. This guidance impacts the measurement date of our performance-based common stock warrants. The measurement periods for the first two successive two-year periods of our outstanding performance-based common stock warrants were completed prior to adoption and were not impacted by this updated guidance. The measurement period for the final two-year period began on January 1, 2020, and accordingly, we measured the fair value of the award as of our adoption date on January 1, 2020. We adopted this guidance using the modified retrospective method. Our adoption did not result in a cumulative adjustment in our consolidated statement of financial position. See Note 15 for further discussion on the performance-based common stock warrants. Recent Accounting Updates Not Yet Effective In December 2019, the FASB issued ASU 2019-12, "Simplifying the Accounting for Income Taxes", which, among other provisions, eliminates certain exceptions to existing guidance related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. This guidance also requires an entity to reflect the effect of an enacted change in tax laws or rates in its effective income tax rate in the first interim period that includes the enactment date of the new legislation, aligning the timing of recognition of the effects from enacted tax law changes on the effective income tax rate with the effects on deferred income tax assets and liabilities. Under existing guidance, an entity recognizes the effects of the enacted tax law change on the effective income tax rate in the period that includes the effective date of the tax law. The guidance is effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. We are currently evaluating the impact of this guidance on our consolidated statement of financial position, results of operations and cash flows.

Cash and Cash Equivalents (Tables)

9 Months Ended

Sep. 30, 2020

Cash and Cash Equivalents [Abstract]

Cash and Cash Equivalents by Geographic Region

Cash and cash equivalents were held in the following geographic regions:


(In thousands)	September 30, 2020		December 31, 2019
North America	$	14,693	$	16,751
People's Republic of China ("PRC")	15,054		13,700
Asia (excluding the PRC)	12,291		21,691
Europe	16,802		9,081
South America	8,306		13,079
Total cash and cash equivalents	$	67,146	$	74,302

Revenue and Accounts Receivable, Net (Tables)

9 Months Ended

Sep. 30, 2020

Receivables [Abstract]

Pattern of Revenue Recognition

The pattern of revenue recognition was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
Goods and services transferred at a point in time	$	127,657	$	152,453	$	365,902	$	429,461
Goods and services transferred over time	25,848		48,271		92,514		149,322
Net sales	$	153,505	$	200,724	$	458,416	$	578,783

Revenue from External Customers by Geographic Areas

Our net sales to external customers by geographic area were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
United States	$	64,367	$	107,546	$	203,981	$	313,029
Asia (excluding PRC)	27,923		29,613		86,043		79,157
Europe	26,119		23,388		72,625		69,510
People's Republic of China	25,625		23,704		63,653		66,465
Latin America	4,546		8,281		12,652		26,187
Other	4,925		8,192		19,462		24,435
Total net sales	$	153,505	$	200,724	$	458,416	$	578,783

Net Sales to Significant Customers

Net sales to the following customers totaled more than 10% of our net sales:


	Three Months Ended September 30,
	2020						2019
	$ (thousands)			% of Net Sales			$ (thousands)			% of Net Sales
Comcast Corporation	$	32,533		21.2	%		$	30,419		15.2	%

Sony Corporation	$	15,927		10.4	%		—		(1)	—		(1)
Ring L.L.C.	—		(1)	—		(1)	$	21,050		10.5	%


	Nine Months Ended September 30,
	2020				2019
	$ (thousands)		% of Net Sales		$ (thousands)		% of Net Sales
Comcast Corporation	$	95,014	20.7	%	$	91,058	15.7	%

(1)Net sales to this customer did not total more than 10% of our total net sales in the indicated period.

Accounts Receivable, Net and Changes in the Allowance for Doubtful Accounts

Accounts receivable, net were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Trade receivables, gross	$	122,882	$	130,888
Allowance for bad debts	(1,797)		(1,492)
Allowance for sales returns	(618)		(623)
Net trade receivables	120,467		128,773
Other	7,627		10,425
Accounts receivable, net	$	128,094	$	139,198

Changes in the allowance for bad debts were as follows:


(In thousands)	Nine Months Ended September 30,
	2020		2019
Balance at beginning of period	$	1,492	$	1,121
Additions to costs and expenses	271		275
Write-offs/Foreign exchange effects	34		(104)
Balance at end of period	$	1,797	$	1,292

Trade Receivables Associated with Significant Customers

Trade receivables associated with these significant customers that totaled more than 10% of our accounts receivable, net were as follows:


	September 30, 2020						December 31, 2019
	$ (thousands)			% of Accounts Receivable, Net			$ (thousands)			% of Accounts Receivable, Net
Comcast Corporation	$	25,390		19.8	%		—		(1)	—		(1)
DISH Network Corporation	—		(1)	—		(1)	$	14,677		10.5	%

(1)Trade receivables associated with this customer did not total more than 10% of our accounts receivable, net at the dates set forth.

Inventories and Significant Suppliers (Tables)

9 Months Ended

Sep. 30, 2020

Inventory Disclosure [Abstract]

Summary of Inventories

Inventories were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Raw materials	$	36,784	$	56,352
Components	17,215		24,599
Work in process	4,075		1,526
Finished goods	57,676		62,658
Inventories	$	115,750	$	145,135

Purchases from Significant Suppliers

Purchases from the following supplier totaled more than 10% of our total inventory purchases:


	Three Months Ended September 30,
	2020				2019
	$ (thousands)		% of Total Inventory Purchases		$ (thousands)		% of Total Inventory Purchases
Qorvo International Pte Ltd.	$	8,472	13.0	%	—	(1)	—	(1)


	Nine Months Ended September 30,
	2020				2019
	$ (thousands)		% of Total Inventory Purchases		$ (thousands)		% of Total Inventory Purchases
Qorvo International Pte Ltd.	$	29,679	13.4	%	—	(1)	—	(1)

(1)Purchases associated with this supplier did not total more than 10% of our total inventory purchases for the indicated period

The supplier that totaled more than 10% of our accounts payable, was as follows:


	September 30, 2020				December 31, 2019
	$ (thousands)		% of Accounts Payable		$ (thousands)		% of Accounts Payable
Zhejiang Zhen You Electronics Co. Ltd.	—	(1)	—	(1)	$	11,394	11.1	%

(1)Accounts payable associated with this supplier did not total more than 10% of our accounts payable at the dates set forth.

Leases (Tables)

9 Months Ended

Sep. 30, 2020

Leases [Abstract]

Lease Balances within the Consolidated Balance Sheet

Lease balances within our consolidated balance sheet were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Assets:
Operating lease right-of-use assets	$	18,678	$	19,826
Liabilities:
Other accrued liabilities	$	5,802	$	4,903
Long-term operating lease obligations	13,284		15,639
Total lease liabilities	$	19,086	$	20,542

Operating Lease Expense, Operating Lease Cash Flows and Supplemental Cash Flow Information

Operating lease expense, including variable and short-term lease costs which were insignificant to the total, operating lease cash flows and supplemental cash flow information were as follows:


(In thousands)	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Cost of sales	$	513	$	574	$	1,285	$	1,627
Selling, general and administrative expenses	976		1,036		2,994		3,324
Total operating lease expense	$	1,489	$	1,610	$	4,279	$	4,951
Operating cash outflows from operating leases	$	1,617	$	1,537	$	4,685	$	5,197
Operating lease right-of-use assets obtained in exchange for lease obligations	$	1,935	$	1,131	$	2,121	$	2,655

Lease Terms and Discount Rates

The weighted average remaining lease liability term and the weighted average discount rate were as follows:


	September 30, 2020		December 31, 2019
Weighted average lease liability term (in years)	3.8		4.3
Weighted average discount rate	4.18	%	4.50	%

Reconciliation of the Undiscounted Cash Flows for Each of the First Five Years and Thereafter to Operating Lease Liabilities


(In thousands)	September 30, 2020
2020 (remaining 3 months)	$	1,462
2021	6,671
2022	5,671
2023	2,835
2024	1,765
Thereafter	2,281
Total lease payments	20,685
Less: imputed interest	(1,599)
Total lease liabilities	$	19,086

Goodwill and Intangible Assets, Net (Tables)

9 Months Ended

Sep. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Changes in the Carrying Amount of Goodwill

Changes in the carrying amount of goodwill were as follows:


(In thousands)
Balance at December 31, 2019	$	48,447
Foreign exchange effects	79
Balance at September 30, 2020	$	48,526

Components of Intangible Assets, Net

The components of intangible assets, net were as follows:


	September 30, 2020						December 31, 2019
(In thousands)	Gross (1)		Accumulated Amortization (1)		Net		Gross (1)		Accumulated Amortization (1)		Net
Distribution rights	$	336	$	(241)	$	95	$	322	$	(210)	$	112
Patents	20,962		(7,294)		13,668		16,587		(6,491)		10,096
Trademarks and trade names	2,786		(2,435)		351		2,785		(2,205)		580
Developed and core technology	4,080		(2,971)		1,109		12,480		(10,016)		2,464
Capitalized software development costs	254		—		254		—		—		—
Customer relationships	31,233		(27,093)		4,140		32,534		(25,956)		6,578
Total intangible assets, net	$	59,651	$	(40,034)	$	19,617	$	64,708	$	(44,878)	$	19,830

(1)This table excludes the gross value of fully amortized intangible assets totaling $17.6 million and $7.4 million at September 30, 2020 and December 31, 2019, respectively.

Estimated Future Amortization Expense Related to Intangible Assets

Estimated future annual amortization expense related to our intangible assets at September 30, 2020, was as follows:


(In thousands)
2020 (remaining 3 months)	$	1,037
2021	3,391
2022	3,263
2023	2,999
2024	2,418
Thereafter	6,509
Total	$	19,617

Accrued Compensation (Tables)

9 Months Ended

Sep. 30, 2020

Payables and Accruals [Abstract]

Components of Accrued Compensation

The components of accrued compensation were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Accrued social insurance (1)	$	7,150	$	16,588
Accrued salary/wages	6,606		7,465
Accrued vacation/holiday	3,046		2,766
Accrued bonus	3,750		13,965
Accrued commission	954		1,283
Other accrued compensation	1,384		1,601
Total accrued compensation	$	22,890	$	43,668

The components of other accrued liabilities were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Contract liabilities	$	2,207	$	1,840
Duties	4,607		3,731
Freight and handling fees	2,503		3,769
Operating lease obligations	5,802		4,903
Product warranty claims costs	1,797		1,514
Professional fees	4,301		2,833
Sales and value added taxes	4,217		3,926
Short-term contingent consideration	1,780		5,428
Other	6,402		7,501
Total other accrued liabilities	$	33,616	$	35,445

Other Accrued Liabilities (Tables)

9 Months Ended

Sep. 30, 2020

Payables and Accruals [Abstract]

Components of Other Accrued Liabilities

The components of accrued compensation were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Accrued social insurance (1)	$	7,150	$	16,588
Accrued salary/wages	6,606		7,465
Accrued vacation/holiday	3,046		2,766
Accrued bonus	3,750		13,965
Accrued commission	954		1,283
Other accrued compensation	1,384		1,601
Total accrued compensation	$	22,890	$	43,668

The components of other accrued liabilities were as follows:


(In thousands)	September 30, 2020		December 31, 2019
Contract liabilities	$	2,207	$	1,840
Duties	4,607		3,731
Freight and handling fees	2,503		3,769
Operating lease obligations	5,802		4,903
Product warranty claims costs	1,797		1,514
Professional fees	4,301		2,833
Sales and value added taxes	4,217		3,926
Short-term contingent consideration	1,780		5,428
Other	6,402		7,501
Total other accrued liabilities	$	33,616	$	35,445

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Changes in the Liability for Product Warranty Claim Costs

Changes in the liability for product warranty claims costs were as follows:


(In thousands)	Nine Months Ended September 30,
	2020		2019
Balance at beginning of period	$	1,514	$	276
Accruals for warranties issued during the period	578		695
Settlements (in cash or in kind) during the period/Foreign exchange effects	(295)		—
Balance at end of period	$	1,797	$	971

Treasury Stock (Tables)

9 Months Ended

Sep. 30, 2020

Equity [Abstract]

Repurchased Shares of Common Stock

Repurchased shares of our common stock were as follows:


	Nine Months Ended September 30,
(In thousands)	2020		2019
Shares repurchased	263		55
Cost of shares repurchased	$	9,822	$	1,741

Long-lived Tangible Assets (Tables)

9 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Long-Lived Tangible Assets by Geographic Area

Long-lived tangible assets by geographic area, which include property, plant, and equipment, net and operating lease right-of-use assets, were as follows:


(In thousands)	September 30, 2020		December 31, 2019
United States	$	16,327	$	19,938
People's Republic of China	61,320		67,625
Mexico	20,624		16,644
All other countries	4,956		6,351
Total long-lived tangible assets	$	103,227	$	110,558

Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2020

Share-based Payment Arrangement [Abstract]

Stock-based Compensation Expense and Related Income Tax Benefit

Stock-based compensation expense by statement of operations caption and the related income tax benefit were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
Cost of sales	$	36	$	37	$	146	$	102
Research and development expenses	287		315		811		809
Selling, general and administrative expenses:
Employees	1,555		1,866		4,695		5,005
Outside directors	382		309		1,202		802
Total employee and director stock-based compensation expense	$	2,260	$	2,527	$	6,854	$	6,718

Income tax benefit	$	494	$	509	$	1,500	$	1,385

Stock Option Activity

Stock option activity was as follows:


	Number of Options (in thousands)	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2019	745	$	41.73
Granted	109	46.17
Exercised	—	—			$	—
Forfeited/canceled/expired	—	—
Outstanding at September 30, 2020 (1)	854	$	42.29	3.63	$	3,853
Vested and expected to vest at September 30, 2020 (1)	854	$	42.29	3.63	$	3,853
Exercisable at September 30, 2020 (1)	634	$	43.04	2.75	$	3,048

Assumptions Used in Valuation and Weighted Average Fair Value of Stock Option Grants

The assumptions we utilized in the Black-Scholes option pricing model and the resulting weighted average fair value of stock option grants were the following:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2020			2019			2020			2019
Weighted average fair value of grants	$	—		$	—		$	17.70		$	10.28
Risk-free interest rate	—		%	—		%	1.44		%	2.49		%
Expected volatility	—		%	—		%	43.95		%	41.64		%
Expected life in years	0.00			0.00			4.59			4.54

Non-Vested Restricted Stock Award Activity

Non-vested restricted stock award activity was as follows:


	Shares (in thousands)	Weighted-Average Grant Date Fair Value
Non-vested at December 31, 2019	310	$	34.99
Granted	235	36.83
Vested	(150)	38.09
Forfeited	(6)	44.31
Non-vested at September 30, 2020	389	$	34.75

Performance-Based Common Stock Warrants (Tables)

9 Months Ended

Sep. 30, 2020

Equity [Abstract]

Purchase Level and Number of Warrants That Will Vest

The table below presents the purchase levels and potential number of warrants to vest in each period based upon achieving the purchase levels.


	Potential Warrants To Vest
Aggregate Level of Purchases by Comcast and Affiliates	January 1, 2016 - December 31, 2017	January 1, 2018 - December 31, 2019	January 1, 2020 - December 31, 2021
$260 million	100,000	100,000	75,000
$300 million	75,000	75,000	75,000
$340 million	75,000	75,000	75,000
Maximum Potential Warrants Earned by Comcast	250,000	250,000	225,000

Assumptions Used in Valuation and Weighted Average Fair Value of Warrants

The assumptions we utilized in the Black-Scholes option pricing model and the resulting grant-date fair value of the warrants as of January 1, 2020 were the following:


Fair value	$	17.19
Price of Universal Electronics Inc. common stock	$	52.21
Risk-free interest rate	1.62		%
Expected volatility	48.86		%
Expected life in years	3.00


	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Fair value	$	16.78		$	16.78
Price of Universal Electronics Inc. common stock	$	51.09		$	51.09
Risk-free interest rate	1.56		%	1.56		%
Expected volatility	47.82		%	47.82		%
Expected life in years	3.25			3.25

Impact to Net Sales in Connection with Warrants and Related Income Tax Benefit

The impact to net sales recorded in connection with the warrants and the related income tax benefit were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
Reduction to net sales	$	187	$	711	$	525	$	1,381
Income tax benefit	$	47	$	177	$	131	$	345

Other Income (Expense), Net (Tables)

9 Months Ended

Sep. 30, 2020

Other Income and Expenses [Abstract]

Other Income (Expense), Net

Other income (expense), net consisted of the following:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2020		2019		2020		2019
Net gain (loss) on foreign currency exchange contracts (1)	$	(72)	$	368	$	(523)	$	(8)
Net gain (loss) on foreign currency exchange transactions	(1,525)		(689)		(865)		(662)
Other income	(49)		173		125		244
Other (expense), net	$	(1,646)	$	(148)	$	(1,263)	$	(426)

(1)This represents the gains (losses) incurred on foreign currency hedging derivatives (see Note 18 for further details).

Earnings (Loss) Per Share (Tables)

9 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Calculation of Earnings Per Share

Earnings (loss) per share was calculated as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands, except per-share amounts)	2020		2019		2020		2019
BASIC
Net income (loss)	$	6,168	$	2,669	$	26,414	$	(3,397)
Weighted-average common shares outstanding	13,928		13,894		13,935		13,861
Basic earnings (loss) per share	$	0.44	$	0.19	$	1.90	$	(0.25)

DILUTED
Net income (loss)	$	6,168	$	2,669	$	26,414	$	(3,397)
Weighted-average common shares outstanding for basic	13,928		13,894		13,935		13,861
Dilutive effect of stock options, restricted stock and common stock warrants	277		276		254		—
Weighted-average common shares outstanding on a diluted basis	14,205		14,170		14,189		13,861
Diluted earnings (loss) per share	$	0.43	$	0.19	$	1.86	$	(0.25)

Securities Excluded from the Computation of Diluted Earnings (Loss) Per Common Share


	Three Months Ended September 30,		Nine Months Ended September 30,
(In thousands)	2020	2019	2020	2019
Stock options	511	382	494	436
Restricted stock awards	—	9	18	89
Performance-based warrants	275	175	275	175

Derivatives (Tables)

9 Months Ended

Sep. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Total Net Fair Value of Derivatives

The following table sets forth the total net fair value of derivatives:


	September 30, 2020								December 31, 2019
	Fair Value Measurement Using						Total Balance		Fair Value Measurement Using						Total Balance
(In thousands)	Level 1		Level 2		Level 3				Level 1		Level 2		Level 3
Foreign currency exchange contracts	$	—	$	153	$	—	$	153	$	—	$	(172)	$	—	$	(172)

Foreign Currency Exchange Contracts

Details of foreign currency exchange contracts held were as follows:


Date Held	Currency	Position Held	Notional Value (in millions)		Forward Rate	Unrealized Gain/(Loss) Recorded at Balance Sheet Date (in thousands)(1)		Settlement Date
September 30, 2020	USD/Chinese Yuan Renminbi	CNY	$	37.0	6.8297	$	210	October 30, 2020
September 30, 2020	USD/Euro	USD	$	26.0	1.1685	$	(87)	October 30, 2020
September 30, 2020	USD/Brazilian Real	USD	$	1.5	5.5368	$	24	October 30, 2020
September 30, 2020	USD/Mexican Peso	USD	$	2.6	22.1285	$	6	October 30, 2020
December 31, 2019	USD/Chinese Yuan Renminbi	USD	$	35.0	6.9867	$	100	January 23, 2020
December 31, 2019	USD/Brazilian Real	USD	$	0.5	4.0560	$	(6)	January 24, 2020
December 31, 2019	USD/Euro	USD	$	28.0	1.1133	$	(253)	January 24, 2020
December 31, 2019	USD/Brazilian Real	USD	$	0.7	4.0870	$	(13)	January 24, 2020

- Definition

Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item.

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+ Details

Cash and Cash Equivalents (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	$ 67,146	$ 74,302
North America
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	14,693	16,751
People's Republic of China
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	15,054	13,700
Asia (excluding PRC)
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	12,291	21,691
Europe
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	16,802	9,081
South America
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	$ 8,306	$ 13,079

Revenue and Accounts Receivable, Net - Pattern of Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Disaggregation of Revenue [Line Items]
Revenues, net	$ 153,505	$ 200,724	$ 458,416	$ 578,783
Goods and services transferred at a point in time
Disaggregation of Revenue [Line Items]
Revenues, net	127,657	152,453	365,902	429,461
Goods and services transferred over time
Disaggregation of Revenue [Line Items]
Revenues, net	$ 25,848	$ 48,271	$ 92,514	$ 149,322

- 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.

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-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 and Accounts Receivable, Net - Revenue from External Customers by Geographic Areas (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Disaggregation of Revenue [Line Items]
Net sales	$ 153,505	$ 200,724	$ 458,416	$ 578,783
United States
Disaggregation of Revenue [Line Items]
Net sales	64,367	107,546	203,981	313,029
Asia (excluding PRC)
Disaggregation of Revenue [Line Items]
Net sales	27,923	29,613	86,043	79,157
Europe
Disaggregation of Revenue [Line Items]
Net sales	26,119	23,388	72,625	69,510
People's Republic of China
Disaggregation of Revenue [Line Items]
Net sales	25,625	23,704	63,653	66,465
Latin America
Disaggregation of Revenue [Line Items]
Net sales	4,546	8,281	12,652	26,187
Other
Disaggregation of Revenue [Line Items]
Net sales	$ 4,925	$ 8,192	$ 19,462	$ 24,435

- Definition

+ References

+ Details

Revenue and Accounts Receivable, Net - Net Sales to Significant Customers (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Disaggregation of Revenue [Line Items]
Net sales	$ 153,505	$ 200,724	$ 458,416	$ 578,783
Comcast Corporation
Disaggregation of Revenue [Line Items]
Net sales	$ 32,533	$ 30,419	$ 95,014	$ 91,058
Comcast Corporation \| Customer Concentration Risk \| Net Sales
Disaggregation of Revenue [Line Items]
Concentration risk percentage	21.20%	15.20%	20.70%	15.70%
Sony Corporation
Disaggregation of Revenue [Line Items]
Net sales	$ 15,927	$ 0
Sony Corporation \| Customer Concentration Risk \| Net Sales
Disaggregation of Revenue [Line Items]
Concentration risk percentage	10.40%	0.00%
Ring L.L.C.
Disaggregation of Revenue [Line Items]
Net sales	$ 0	$ 21,050
Ring L.L.C. \| Customer Concentration Risk \| Net Sales
Disaggregation of Revenue [Line Items]
Concentration risk percentage	0.00%	10.50%

- Definition

+ References

+ Details

Revenue and Accounts Receivable, Net - Accounts Receivable, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019	Sep. 30, 2019	Dec. 31, 2018
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract]
Trade receivables, gross	$ 122,882	$ 130,888
Allowance for bad debts	(1,797)	(1,492)	$ (1,292)	$ (1,121)
Allowance for sales returns	(618)	(623)
Net trade receivables	120,467	128,773
Other	7,627	10,425
Accounts receivable, net	$ 128,094	$ 139,198

Revenue and Accounts Receivable, Net - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Schedule of Allowance for Doubtful Accounts
Balance at beginning of period	$ 1,492	$ 1,121
Additions to costs and expenses	271	275
Write-offs/Foreign exchange effects	34	(104)
Balance at end of period	$ 1,797	$ 1,292

Revenue and Accounts Receivable, Net - Trade Receivables Associated with Significant Customers (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Comcast Corporation
Revenue, Major Customer [Line Items]
Accounts receivable, net	$ 25,390	$ 0
Comcast Corporation \| Trade Accounts Receivable
Revenue, Major Customer [Line Items]
Concentration risk percentage	19.80%	0.00%
Dish Network Corporation [Member]
Revenue, Major Customer [Line Items]
Accounts receivable, net	$ 0	$ 14,677
Dish Network Corporation [Member] \| Trade Accounts Receivable
Revenue, Major Customer [Line Items]
Concentration risk percentage	0.00%	10.50%

Inventories and Significant Suppliers - Summary of Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Raw materials	$ 36,784	$ 56,352
Components	17,215	24,599
Work in process	4,075	1,526
Finished goods	57,676	62,658
Inventories	$ 115,750	$ 145,135

Inventories and Significant Suppliers - Purchases from Significant Suppliers (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Qorvo International Pte Ltd.
Concentration Risk [Line Items]
Inventory purchases	$ 8,472	$ 0	$ 29,679	$ 0
Zhejiang Zhen You Electronics Co. Ltd.
Concentration Risk [Line Items]
Inventory purchases			$ 0		$ 11,394
Supplier Concentration Risk \| Inventory Purchases \| Qorvo International Pte Ltd.
Concentration Risk [Line Items]
Concentration risk percentage	13.00%	0.00%	13.40%	0.00%
Supplier Concentration Risk \| Accounts Payable \| Zhejiang Zhen You Electronics Co. Ltd.
Concentration Risk [Line Items]
Concentration risk percentage			0.00%		11.10%

Leases - Narrative (Details)	Sep. 30, 2020 lease
Leases [Abstract]
Remaining lease terms (up to)	40 years
Number of operating leases not yet commenced	1
Term of operating lease that has not yet commenced	5 years

Leases - Lease Balances within the Consolidated Balance Sheet (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Assets:
Operating lease right-of-use assets	$ 18,678	$ 19,826
Liabilities:
Other accrued liabilities	5,802	4,903
Long-term operating lease obligations	13,284	15,639
Total lease liabilities	$ 19,086	$ 20,542
Lease liability location within the Consolidated Balance Sheets	us-gaap:OtherAccruedLiabilitiesCurrent

Leases - Operating Lease Expense, Operating Lease Cash Flows and Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Lessee, Lease, Description [Line Items]
Operating lease expense	$ 1,489	$ 1,610	$ 4,279	$ 4,951
Operating cash outflows from operating leases	1,617	1,537	4,685	5,197
Operating lease right-of-use assets obtained in exchange for lease obligations	1,935	1,131	2,121	2,655
Cost of sales
Lessee, Lease, Description [Line Items]
Operating lease expense	513	574	1,285	1,627
Selling, general and administrative expenses
Lessee, Lease, Description [Line Items]
Operating lease expense	$ 976	$ 1,036	$ 2,994	$ 3,324

Leases - Lease Terms and Discount Rates (Details)	Sep. 30, 2020	Dec. 31, 2019
Leases [Abstract]
Weighted average lease term	3 years 9 months 18 days	4 years 3 months 18 days
Weighted average discount rate	4.18%	4.50%

Leases - Reconciliation of the Undiscounted Cash Flows for Each of the First Five Years and Thereafter to Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Leases [Abstract]
2020 (remaining 3 months)	$ 1,462
2021	6,671
2022	5,671
2023	2,835
2024	1,765
Thereafter	2,281
Total lease payments	20,685
Less: imputed interest	(1,599)
Total lease liabilities	$ 19,086	$ 20,542

Goodwill and Intangible Assets, Net - Changes in the Carrying Amount of Goodwill (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($)
Goodwill [Roll Forward]
Balance	$ 48,447
Foreign exchange effects	79
Balance	$ 48,526

Goodwill and Intangible Assets, Net - Components of Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Finite-Lived Intangible Assets, Net [Abstract]
Gross	$ 59,651	$ 64,708
Accumulated Amortization	(40,034)	(44,878)
Total	19,617	19,830
Gross value of fully amortized intangible assets	17,600	7,400
Distribution rights
Finite-Lived Intangible Assets, Net [Abstract]
Gross	336	322
Accumulated Amortization	(241)	(210)
Total	95	112
Patents
Finite-Lived Intangible Assets, Net [Abstract]
Gross	20,962	16,587
Accumulated Amortization	(7,294)	(6,491)
Total	13,668	10,096
Trademarks and trade names
Finite-Lived Intangible Assets, Net [Abstract]
Gross	2,786	2,785
Accumulated Amortization	(2,435)	(2,205)
Total	351	580
Developed and core technology
Finite-Lived Intangible Assets, Net [Abstract]
Gross	4,080	12,480
Accumulated Amortization	(2,971)	(10,016)
Total	1,109	2,464
Capitalized software development costs
Finite-Lived Intangible Assets, Net [Abstract]
Gross	254	0
Accumulated Amortization	0	0
Total	254	0
Customer relationships
Finite-Lived Intangible Assets, Net [Abstract]
Gross	31,233	32,534
Accumulated Amortization	(27,093)	(25,956)
Total	$ 4,140	$ 6,578

Goodwill and Intangible Assets, Net - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Finite-Lived Intangible Assets [Line Items]
Amortization expense	$ 1.8	$ 1.8
Selling, General and Administrative Expenses
Finite-Lived Intangible Assets [Line Items]
Amortization expense			$ 5.5	$ 5.4

Goodwill and Intangible Assets, Net - Estimated Future Annual Amortization Expense Related to Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Schedule of Estimated Future Amortization expense
2020 (remaining 3 months)	$ 1,037
2021	3,391
2022	3,263
2023	2,999
2024	2,418
Thereafter	6,509
Total	$ 19,617	$ 19,830

Line of Credit (Details) - USD ($)	3 Months Ended		9 Months Ended
Line of Credit (Details) - USD ($)	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Line of Credit Facility [Line Items]
Amount outstanding under line of credit	$ 50,000,000		$ 50,000,000		$ 68,000,000
Interest expense on borrowings	$ 300,000	$ 1,400,000	$ 900,000	$ 3,400,000
Line of Credit \| US Bank
Line of Credit Facility [Line Items]
Effective interest rate	1.39%		1.39%
Line of Credit \| US Bank \| LIBOR \| Minimum
Line of Credit Facility [Line Items]
Basis spread on variable rate			1.25%
Line of Credit \| US Bank \| LIBOR \| Maximum
Line of Credit Facility [Line Items]
Basis spread on variable rate			1.75%
Line of Credit \| US Bank \| Base Rate \| Minimum
Line of Credit Facility [Line Items]
Basis spread on variable rate			0.00%
Line of Credit \| US Bank \| Base Rate \| Maximum
Line of Credit Facility [Line Items]
Basis spread on variable rate			0.50%
Line of Credit \| US Bank \| Enson
Line of Credit Facility [Line Items]
Ownership interest used to secure obligations	65.00%		65.00%
Line of Credit \| Second Amended Credit Agreement
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 125,000,000.0		$ 125,000,000.0
Commitment fees			0
Letter of Credit
Line of Credit Facility [Line Items]
Letter of credit outstanding amount	$ 2,700,000		$ 2,700,000

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Income tax expense	$ 2,164	$ 2,526	$ 5,267	$ 3,747
Unrecognized tax benefits	3,100		3,100
Unrecognized tax benefits that would impact effective rate	3,100		3,100
Anticipated decrease in unrecognized tax benefits	200		200
Accrued interest and penalties	$ 200		$ 200		$ 200

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Accrued Compensation - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended		3 Months Ended		9 Months Ended
	Jun. 30, 2020	Jun. 30, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Accrued social insurance adjustment			$ 0	$ 0	$ 9,464	$ 0
Guangzhou \| Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Indemnification period		2 years
Accrued social insurance adjustment	$ 9,500

Accrued Compensation (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Payables and Accruals [Abstract]
Accrued social insurance	$ 7,150	$ 16,588
Accrued salary/wages	6,606	7,465
Accrued vacation/holiday	3,046	2,766
Accrued bonus	3,750	13,965
Accrued commission	954	1,283
Other accrued compensation	1,384	1,601
Total accrued compensation	$ 22,890	$ 43,668

Other Accrued Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Payables and Accruals [Abstract]
Contract liabilities	$ 2,207	$ 1,840
Duties	4,607	3,731
Freight and handling fees	2,503	3,769
Operating lease obligations	5,802	4,903
Product warranty claims costs	1,797	1,514
Professional fees	4,301	2,833
Sales and value added taxes	4,217	3,926
Short-term contingent consideration	1,780	5,428
Other	6,402	7,501
Total other accrued liabilities	$ 33,616	$ 35,445

Commitments and Contingencies - Changes in the Liability for Product Warranty Claim Costs (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Schedule of Changes in Reserve for Product Warranty Claim Costs
Balance at beginning of period	$ 1,514	$ 276
Accruals for warranties issued during the period	578	695
Settlements (in cash or in kind) during the period/Foreign exchange effects	(295)	0
Balance at end of period	$ 1,797	$ 971

Commitments and Contingencies - Narrative (Details)			2 Months Ended
Commitments and Contingencies - Narrative (Details)	Apr. 09, 2020 patent	Sep. 05, 2018 patent	Jun. 30, 2020 patent inter_partes_review	Sep. 30, 2020 inter_partes_review
Contingencies [Line Items]
Number of IPR requests denied \| inter_partes_review				3
Number of IPR requests granted \| inter_partes_review				6
Number of IPR requests \| inter_partes_review			4
Number of patents subject to IPR requests			3
Roku Lawsuit \| Pending Litigation
Contingencies [Line Items]
Number of patents allegedly infringed upon		9
Number of patent families		4
Roku, TCL, Hisense, and Funai Patent Infringement - ITC Matter \| Pending Litigation
Contingencies [Line Items]
Number of patents allegedly infringed upon	5
TLC Hisense and Funai - ITC Matter \| Pending Litigation
Contingencies [Line Items]
Number of patents allegedly infringed upon	6

Treasury Stock - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended						9 Months Ended
	Nov. 05, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2020	Sep. 30, 2019	Nov. 10, 2020	Sep. 15, 2020
Equity, Class of Treasury Stock [Line Items]
Shares repurchased (in shares)								263,000	55,000
Cost of shares repurchased		$ 3,417	$ 114	$ 6,291	$ 337	$ 189	$ 1,215	$ 9,822	$ 1,741
Share Repurchase Program Authorized September 15, 2020
Equity, Class of Treasury Stock [Line Items]
Repurchase of common stock (in shares)											300,000
Remaining common stock authorized for repurchase (in shares)		213,075						213,075
Share Repurchase Program Authorized September 15, 2020 \| Subsequent Event
Equity, Class of Treasury Stock [Line Items]
Shares repurchased (in shares)	113,075
Cost of shares repurchased	$ 4,400
Share Repurchase Program Authorized November 10 2020 \| Subsequent Event
Equity, Class of Treasury Stock [Line Items]
Repurchase of common stock (in shares)										500,000

Treasury Stock - Repurchased Shares of Common Stock (Details) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2020	Sep. 30, 2019
Equity [Abstract]
Shares repurchased (in shares)							263	55
Cost of shares repurchased	$ 3,417	$ 114	$ 6,291	$ 337	$ 189	$ 1,215	$ 9,822	$ 1,741

Long-lived Tangible Assets - Long-Lived Tangible Assets by Geographic Area (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Long-lived Assets from External Customers and Long-Lived Assets [Line Items]
Long-lived tangible assets	$ 103,227	$ 110,558
United States
Long-lived Assets from External Customers and Long-Lived Assets [Line Items]
Long-lived tangible assets	16,327	19,938
People's Republic of China
Long-lived Assets from External Customers and Long-Lived Assets [Line Items]
Long-lived tangible assets	61,320	67,625
Mexico
Long-lived Assets from External Customers and Long-Lived Assets [Line Items]
Long-lived tangible assets	20,624	16,644
All other countries
Long-lived Assets from External Customers and Long-Lived Assets [Line Items]
Long-lived tangible assets	$ 4,956	$ 6,351

Stock-Based Compensation - Stock-based Compensation Expense and Related Income Tax Benefit (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Employee and director stock-based compensation expense	$ 2,260	$ 2,527	$ 6,854	$ 6,718
Income tax benefit	494	509	1,500	1,385
Cost of sales
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Employee and director stock-based compensation expense	36	37	146	102
Research and development expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Employee and director stock-based compensation expense	287	315	811	809
Selling, general and administrative expenses \| Employees
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Employee and director stock-based compensation expense	1,555	1,866	4,695	5,005
Selling, general and administrative expenses \| Outside directors
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Employee and director stock-based compensation expense	$ 382	$ 309	$ 1,202	$ 802

Stock-Based Compensation - Stock Option Activity (Details) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($) $ / shares shares
Number of Options
Outstanding at beginning of period (in shares) \| shares	745
Granted (in shares) \| shares	109
Exercised (in shares) \| shares	0
Forfeited/canceled/expired (in shares) \| shares	0
Outstanding at end of period (in shares) \| shares	854
Vested and expected to vest at end of period (in shares) \| shares	854
Exercisable at end of period (in shares) \| shares	634
Weighted-Average Exercise Price
Outstanding at beginning of period (in dollars per share) \| $ / shares	$ 41.73
Granted (in dollars per share) \| $ / shares	46.17
Exercised (in dollars per share) \| $ / shares	0
Forfeited/canceled/expired (in dollars per share) \| $ / shares	0
Outstanding at end of period (in dollars per share) \| $ / shares	42.29
Vested and expected to vest at end of period (in dollars per share) \| $ / shares	42.29
Exercisable at end of period (in dollars per share) \| $ / shares	$ 43.04
Weighted-Average Remaining Contractual Term (in years)
Outstanding at end of period	3 years 7 months 17 days
Vested and expected to vest at end of period	3 years 7 months 17 days
Exercisable at end of period	2 years 9 months
Aggregate Intrinsic Value
Exercised \| $	$ 0
Outstanding at end of period \| $	3,853
Vested and expected to vest at end of period \| $	3,853
Exercisable at end of period \| $	$ 3,048

Stock-Based Compensation - Assumptions Used in Valuation and Weighted Average Fair Value of Stock Option Grants (Details) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Share-based Payment Arrangement [Abstract]
Weighted average fair value of grants (in dollars per share)	$ 0	$ 0	$ 17.70	$ 10.28
Risk-free interest rate	0.00%	0.00%	1.44%	2.49%
Expected volatility	0.00%	0.00%	43.95%	41.64%
Expected life in years	0 years	0 years	4 years 7 months 2 days	4 years 6 months 14 days

Stock-Based Compensation - Narrative (Details) $ in Millions	9 Months Ended
	Sep. 30, 2020 USD ($)
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized pre-tax stock-based compensation expense	$ 2.7
Unrecognized pre-tax stock-based compensation expense, remaining weighted-average life	1 year 10 months 24 days
Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized pre-tax stock-based compensation expense	$ 10.2
Unrecognized pre-tax stock-based compensation expense, remaining weighted-average life	1 year 10 months 24 days

Stock-Based Compensation - Non-Vested Restricted Stock Award Activity (Details) shares in Thousands	9 Months Ended
	Sep. 30, 2020 $ / shares shares
Shares
Non-vested at beginning of period (in shares) \| shares	310
Granted (in shares) \| shares	235
Vested (in shares) \| shares	(150)
Forfeited (in shares) \| shares	(6)
Non-vested at end of period (in shares) \| shares	389
Weighted-Average Grant Date Fair Value
Non-vested at beginning of period (in dollars per share) \| $ / shares	$ 34.99
Granted (in dollars per share) \| $ / shares	36.83
Vested (in dollars per share) \| $ / shares	38.09
Forfeited (in dollars per share) \| $ / shares	44.31
Non-vested at end of period (in dollars per share) \| $ / shares	$ 34.75

Performance-Based Common Stock Warrants - Narrative (Details)		24 Months Ended
	Mar. 09, 2016 USD ($) vesting_period $ / shares shares	Dec. 31, 2019 shares	Dec. 31, 2017 shares	Sep. 30, 2020 USD ($) shares
Class of Warrant or Right [Line Items]
Unrecognized estimated fair value of unvested warrants \| $				$ 800,000
Common Stock Purchase Warrants
Class of Warrant or Right [Line Items]
Number of shares called by warrants (in shares)	725,000
Exercise price of warrants (in dollars per share) \| $ / shares	$ 54.55
Number of vesting periods \| vesting_period	3
Term of successive vesting periods	2 years	2 years	2 years
Vesting period one	2 years
Vested warrants outstanding (in shares)				275,000
Unearned underlying shares (in shares)				225,000
Number of warrants vested (in shares)				0
Comcast Corporation \| Common Stock Purchase Warrants
Class of Warrant or Right [Line Items]
Number of warrants vested in period (in shares)		100,000	175,000
Maximum warrants available to vest (in shares)		250,000	250,000
Supply Threshold \| Common Stock Purchase Warrants
Class of Warrant or Right [Line Items]
Aggregate level of purchases, $260 million threshold \| $	$ 260,000,000
Aggregate level of purchases, $340 million threshold \| $	$ 340,000,000
Supply threshold amount \| $				$ 340,000,000

Performance-Based Common Stock Warrants - Purchase Level and Number of Warrants to Vest (Details) - Common Stock Purchase Warrants - Supply Threshold	Mar. 09, 2016 USD ($) shares
Class of Warrant or Right [Line Items]
Aggregate level of purchases, threshold one \| $	$ 260,000,000
Aggregate level of purchases, threshold two \| $	300,000,000
Aggregate level of purchases, threshold three \| $	$ 340,000,000
Incremental Warrants That Will Vest January 1, 2016 - December 31, 2017
$260 million threshold (in shares)	100,000
$300 million threshold (in shares)	75,000
$340 million threshold (in shares)	75,000
Maximum Potential Warrants Earned by Comcast (in shares)	250,000
Incremental Warrants That Will Vest January 1, 2018 - December 31, 2019
$260 million threshold (in shares)	100,000
$300 million threshold (in shares)	75,000
$340 million threshold (in shares)	75,000
Maximum Potential Warrants Earned by Comcast (in shares)	250,000
Incremental Warrants That Will Vest January 1, 2020 - December 31, 2021
$260 million threshold (in shares)	75,000
$300 million threshold (in shares)	75,000
$340 million threshold (in shares)	75,000
Maximum Potential Warrants Earned by Comcast (in shares)	225,000

Performance-Based Common Stock Warrants - Assumptions Used in Valuation and Weighted Average Fair Value of Warrants (Details) - Common Stock Purchase Warrants	Jan. 01, 2020 $ / shares	Sep. 30, 2019 $ / shares
Class of Warrant or Right [Line Items]
Fair value (in dollars per share)	$ 17.19	$ 16.78
Price of Universal Electronics Inc. common stock (in dollars per share)	$ 52.21	$ 51.09
Risk-free interest rate
Class of Warrant or Right [Line Items]
Valuation assumption rate	0.0162	0.0156
Expected volatility
Class of Warrant or Right [Line Items]
Valuation assumption rate	0.4886	0.4782
Expected life
Class of Warrant or Right [Line Items]
Expected life	3 years	3 years 3 months

Performance-Based Common Stock Warrants - Impact to Net Sales in Connection with Warrants and Related Income Tax Benefit (Details) - Common Stock Purchase Warrants - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Class of Warrant or Right [Line Items]
Reduction to net sales	$ 187	$ 711	$ 525	$ 1,381
Income tax benefit	$ 47	$ 177	$ 131	$ 345

Other Income (Expense), Net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Other Income and Expenses [Abstract]
Net gain (loss) on foreign currency exchange contracts	$ (72)	$ 368	$ (523)	$ (8)
Net gain (loss) on foreign currency exchange transactions	(1,525)	(689)	(865)	(662)
Other income	(49)	173	125	244
Other (expense), net	$ (1,646)	$ (148)	$ (1,263)	$ (426)

Earnings (Loss) Per Share - Calculation of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2020	Sep. 30, 2019
BASIC
Net income (loss)	$ 6,168	$ 14,400	$ 5,846	$ 2,669	$ (5,061)	$ (1,005)	$ 26,414	$ (3,397)
Weighted-average common shares outstanding (in shares)	13,928			13,894			13,935	13,861
Basic earnings (loss) per share (in dollars per share)	$ 0.44			$ 0.19			$ 1.90	$ (0.25)
DILUTED
Net income (loss)	$ 6,168	$ 14,400	$ 5,846	$ 2,669	$ (5,061)	$ (1,005)	$ 26,414	$ (3,397)
Weighted-average common shares outstanding (in shares)	13,928			13,894			13,935	13,861
Dilutive effect of stock options, restricted stock and common stock warrants (in shares)	277			276			254	0
Weighted-average common shares outstanding on a diluted basis (in shares)	14,205			14,170			14,189	13,861
Diluted earnings (loss) per share (in dollars per share)	$ 0.43			$ 0.19			$ 1.86	$ (0.25)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Earnings (Loss) Per Share - Securities Excluded from the Computation of Diluted Earnings (Loss) Per Common Share (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Securities excluded in computation of diluted earning per share (in shares)	511	382	494	436
Restricted stock awards
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Securities excluded in computation of diluted earning per share (in shares)	0	9	18	89
Performance-based warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Securities excluded in computation of diluted earning per share (in shares)	275	175	275	175

Derivatives - Total Net Fair Value of Derivatives (Details) - Fair Value Measurements on a Recurring Basis - Foreign Currency Exchange Contracts - Not Designated as Hedging Instrument - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Total Balance
Derivatives, Fair Value [Line Items]
Foreign currency exchange contracts	$ 153	$ (172)
Level 1
Derivatives, Fair Value [Line Items]
Foreign currency exchange contracts	0	0
Level 2
Derivatives, Fair Value [Line Items]
Foreign currency exchange contracts	153	(172)
Level 3
Derivatives, Fair Value [Line Items]
Foreign currency exchange contracts	$ 0	$ 0

Derivatives - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Derivatives - Narrative (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Derivative Instruments,Gain (Loss) [Line Items]
Net gain (loss) on foreign currency exchange contracts	$ (72)	$ 368	$ (523)	$ (8)
Not Designated as Hedging Instrument \| Foreign Currency Exchange Contracts
Derivative Instruments,Gain (Loss) [Line Items]
Net gain (loss) on foreign currency exchange contracts	$ (100)	$ 400	$ (500)	$ (8)

Derivatives - Foreign Currency Exchange Contracts (Details) - Not Designated as Hedging Instrument $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2020 USD ($) $ / ¥ $ / € $ / R$ $ / $	Dec. 31, 2019 USD ($) $ / ¥ $ / € $ / R$
USD/Chinese Yuan Renminbi
Derivative [Line Items]
Notional value	$ 37,000	$ 35,000
Forward rate \| $ / ¥	6.8297	6.9867
Unrealized gain/(loss) recorded at balance sheet date	$ 210	$ 100
USD/Euro
Derivative [Line Items]
Notional value	$ 26,000	$ 28,000
Forward rate \| $ / €	1.1685	1.1133
Unrealized gain/(loss) recorded at balance sheet date	$ (87)	$ (253)
USD/Brazilian Real
Derivative [Line Items]
Notional value	$ 1,500
Forward rate \| $ / R$	5.5368
Unrealized gain/(loss) recorded at balance sheet date	$ 24
USD/Brazilian Real \| USD/Brazilian Real, Contract 1
Derivative [Line Items]
Notional value		$ 500
Forward rate \| $ / R$		4.0560
Unrealized gain/(loss) recorded at balance sheet date		$ (6)
USD/Brazilian Real \| USD/Brazilian Real, Contract 2
Derivative [Line Items]
Notional value		$ 700
Forward rate \| $ / R$		4.0870
Unrealized gain/(loss) recorded at balance sheet date		$ (13)
USD/Mexican Peso
Derivative [Line Items]
Notional value	$ 2,600
Forward rate \| $ / $	22.1285
Unrealized gain/(loss) recorded at balance sheet date	$ 6