8x8 2015 Annual Report Download - page 59

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8X8, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES
THE COMPANY
8x8, Inc. ("8x8" or the "Company") was incorporated in California in February 1987 and was reincorporated in Delaware in December 1996.
The Company is a leading provider of VoIP technology and SaaS (Software as a service) communication solutions in the cloud for SMBs and
mid-market and distributed enterprises. The Company delivers a broad suite of SaaS services to in-office and mobile devices spanning cloud
telephony, virtual contact center and virtual meeting through its proprietary unified SaaS platform. The Company currently serves approximately
41,600 business customers with over 650,000 subscriptions, making it a leading provider of UCC services in the cloud. The Company's software
abstracts complex networking, redundancy, security and interconnection requirements to provide a seamless and easy-to-use solution for its
customers. The Company's software also integrates with leading enterprise resource planning, customer relationship management, or human
capital management, and other third-party application suites, such as Salesforce.com and NetSuite, to provide organizations an integrated, fully
functional business communications and collaboration experience that is critical to operate their businesses.
The Company's fiscal year ends on March 31 of each calendar year. Each reference to a fiscal year in these notes to the consolidated financial
statements refers to the fiscal year ended March 31 of the calendar year indicated (for example, fiscal 2015 refers to the fiscal year ended March
31, 2015).
Common Stock Offering
In November 2013, the Company completed an underwritten registered offering of common stock in which it sold 14,375,000 shares for total
cash proceeds of approximately $125.8 million, net of issuance costs of $0.6 million. The shares issued in the offering had been registered under
a shelf registration statement previously filed with the Securities and Exchange Commission relating to up to $250,000,000 of the Company's
securities. A member of the Company's board of directors participated in the offering and purchased 30,000 shares at the public offering price.
Acquisition of Voicenet Solutions Limited
In November 2013, the Company entered into a share purchase agreement with the shareholders and optionholders of Voicenet Solutions
Limited, a provider of cloud communications and collaboration services in the United Kingdom. See Note 13.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of 8x8 and its subsidiaries. All material intercompany accounts and transactions have
been eliminated.
USE OF ESTIMATES
The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States
requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and equity and disclosure of
contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the
reporting period. On an on-going basis, the Company evaluates its estimates, including, but not limited to, those related to bad debts, returns
reserve for expected cancellations, valuation of inventories, income and sales tax, and litigation and other contingencies. The Company bases its
estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of
which form the basis for making judgments about the carrying value of assets and liabilities, and equity that are not readily apparent from other
sources. Actual results could differ from those estimates under different assumptions or conditions.
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