quality and customer service are the cornerstones of our strategy and were instrumental in our turnaround in financial performance in 2018 and 2019. we began by focusing on call center metrics in the u.s. , europe and australia , and reduced the average wait time from over 10 minutes in 2017 to 2 minutes in 2018 to under 2 minutes by the end of 2019. we introduced self-service tools such as the service-on-the-go that allow our installers and partners to submit requests from their phone in less than 60 seconds . the launch of our iq 7 series microinverter worldwide , the smallest , lightest and most powerful microinverter we have ever made , was a key factor in improving gross margin . every region of the world where our products are sold is now using this seventh-generation microinverter . during year ended december 31 , 2019 , 98 % of our microinverter shipments were iq 7. we systematically rolled out high-power and high-efficiency variants of the iq 7 microinverters in 2018. selling these variants simultaneously improved gross margin and delivered a better price per watt for the installer . enphase energy , inc. | 2019 form 10-k | 40 on january 28 , 2019 , we repaid in full the remaining principal amount of the term loans of approximately $ 39.5 million plus accrued interest and fees owed to lenders affiliated with tennenbaum capital partners , llc . on may 30 , 2019 , we entered into separately and privately negotiated transactions with certain holders of our 4.0 % convertible senior notes due 2023 ( “ notes due 2023 ” ) resulting in the repurchase and exchange , as of june 5 , 2019 , of $ 60.0 million aggregate principal amount of the notes in consideration for the issuance of 10,801,080 shares of common stock and separate cash payments totaling $ 6.0 million . on june 5 , 2019 , we issued $ 132.0 million aggregate principal amount of our 1.0 % convertible senior notes due 2024 ( the “ notes due 2024 ” ) in a private placement . the notes due 2024 are general unsecured obligations and bear interest at a rate of 1.0 % per year , payable semi-annually on june 1 and december 1 of each year , beginning on december 1 , 2019 . the notes due 2024 will mature on june 1 , 2024 , unless earlier repurchased by us or converted at the option of the holders . further information relating to the notes due 2024 may be found in note 11 , “ debt , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k and below under “ liquidity and capital resources . ” 2020 outlook we believe our solid execution in 2019 positions us well to take advantage of future growth opportunities , and we need to maintain our focus in order to capitalize on such opportunities . our top three priorities for 2020 are ( i ) providing a remarkable customer experience , ( ii ) introduction of new products and expansion of our markets , and ( iii ) focus on enhancements to our comprehensive digital platform . customer experience . quality and customer service constitute customer experience . this has remained a priority for three years running . on the service front , our installer , distributor and module partners are our first line of association with our ultimate customer , the homeowner and business user . our goals are to partner better with these service providers so that we can provide exceptional high quality service to our homeowner . we are convinced that continued reinforcement of customer experience improvements can be a competitive advantage for us . introduce new products and expand our market . we are focused on residential solar in a dozen countries providing serviceable available market ( ‘ sam ' ) of approximately $ 3.3 billion in 2019. we also plan to introduce new products in 2020 which will take our sam to $ 12.5 billion in 2022 which will comprise of residential solar , residential storage , small commercial solar and off-grid solar and storage . expand our digital presence . we are focused on generating revenue through digitalization of the business-to-business and business-to-customer process of the partner and customer journey . future key focus is to expand our digital presence through enhancing our online store , increasing the use of the online store significantly , and releasing a comprehensive digital platform . components of consolidated statements of operations net revenues we primarily generate net revenues from sales of our microinverter solutions and related accessories , which can include our ac battery storage systems , our envoy communications gateway and enlighten cloud-based monitoring service as well as other accessories . our revenue is affected by changes in the volume and average selling prices of our solutions and related accessories , supply and demand , sales incentives , and competitive product offerings . our revenue growth is dependent on our ability to compete effectively in the marketplace by remaining cost competitive , developing and introducing new products that meet the changing technology and performance requirements of our customers , the diversification and expansion of our revenue base , and our ability to market our products in a manner that increases awareness for microinverter technology and differentiates us in the marketplace . enphase energy , inc. | 2019 form 10-k | 41 cost of revenues and gross profit cost of revenues is comprised primarily of product costs , warranty , manufacturing personnel and logistics costs , freight costs , depreciation and amortization of test equipment and hosting services costs . our product costs are impacted by technological innovations , such as advances in semiconductor integration and new product introductions , economies of scale resulting in lower component costs , and improvements in production processes and automation . story_separator_special_tag ( as defined in the relevant indenture ) per $ 1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the our common stock and the conversion rate on each such trading day ; or ( 3 ) upon the occurrence of specified corporate events . upon conversion of any of the notes , we will pay or deliver , as the case may be , cash , shares of common stock or a combination of cash and common stock , at our election . in connection with the offering of the notes due 2024 , we entered into privately-negotiated convertible note hedge transactions in order to reduce the potential dilution to our common stock upon any conversion of the notes due 2024 . the total cost of the convertible note hedge transactions was approximately $ 36.3 million . also , concurrently with the offering of the notes due 2024 , we entered into privately-negotiated warrant transactions whereby we issued warrants to acquire shares of our common stock at a strike price of $ 25.2320 rather than the notes due 2024 conversion price of $ 20.5010 . we received approximately $ 29.8 million from the sale of the warrants . as of february 21 , 2020 , the notes due 2024 were not converted into equity , therefore , we had not purchased any shares under the convertible note hedge and the warrants had not been exercised and remain outstanding . if holders of the notes due 2024 are able to convert the debt to equity , and exercise that right , we have asserted our intent and ability to settle the $ 132.0 million aggregate principal amount of the notes due 2024 in cash . see note 11 , “ debt , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k for more information relating to the convertible note hedge transactions and warrants . we believe that our existing cash and cash equivalents and cash flows from our operating activities will be sufficient to meet our anticipated cash needs for at least the next 12 months . story_separator_special_tag style= `` line-height:120 % ; padding-bottom:8px ; padding-top:8px ; text-align : justify ; text-indent:36px ; font-size:10pt ; `` > revenues are recognized when control of the promised goods or services are transferred to our customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or services . we generate all of our revenues from contracts with our customers . a description of principal activities from which we generate revenues are as follows . products delivered at a point in time . we sell our products to customers in accordance with the terms of the related customer contracts . we generate revenues from sales of our solutions , which include microinverter units and related accessories , an envoy communications gateway and enlighten service , communications accessories and ac battery storage solutions to distributors , large installers , oems and strategic partners . microinverter units , microinverter accessories , and ac battery storage solutions are delivered to customers at a point in time , and we recognize revenue for these products when we transfer control of the product to the customer , which is generally upon shipment . products delivered over time . the sale of an envoy communications gateway includes our enlighten cloud-based monitoring service . the full consideration for these products represents a single performance obligation and is deferred at the sale date and recognized over the estimated service period of 6 years . we also sell certain communication accessories that are delivered over time . the revenue from these products is recognized over the related service period , which is typically 5 or 12 years . we previously sold envoy communications device to certain customers under a long-term financing arrangement . under this financing arrangement , we net the unbilled receivables against deferred revenue . we record certain contra revenue promotions as variable consideration and recognizes these promotions at the time the related revenue is recorded . enphase energy , inc. | 2019 form 10-k | 49 we record upfront contract acquisition costs , such as sales commissions , to be capitalized and amortized over the estimated life of the asset . for contracts that have a duration of less than one year , we follow the topic 606 practical expedient and expense these costs when incurred . commissions related to our sale of monitoring hardware and service are capitalized and amortized over the period of the associated revenue . see note 3 . “ revenue recognition , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k for additional information related to revenue recognition . inventory inventory is valued at the lower of cost or market . market is current replacement cost ( by purchase or by reproduction , dependent on the type of inventory ) . in cases where market exceeds net realizable value ( i.e . , estimated selling price less reasonably predictable costs of completion and disposal ) , inventories are stated at net realizable value . market is not considered to be less than net realizable value reduced by an allowance for an approximately normal profit margin . we determine cost on a first-in first-out basis . certain factors could affect the realizable value of its inventory , including customer demand and market conditions . management assesses the valuation on a quarterly basis and writes down the value for any excess and obsolete inventory based upon expected demand , anticipated sales price , effect of new product introductions , product obsolescence , customer concentrations , product merchantability and other factors . inventory write-downs are equal to the difference between the cost of inventories

cash flows . the following table summarizes our cash flows for the periods presented : replace_table_token_12_th enphase energy , inc. | 2019 form 10-k | 47 c ash flows from operating activities for the year ended december 31 , 2019 , net cash provided by operating activities was $ 139.1 million compared to net cash provided by operating activities of $ 16.1 million in 2018 , an increase of $ 122.9 million year-over-year . the $ 122.9 million increase in net cash provided by operating activities in 2019 compared to 2018 , was primarily due to higher profitability in 2019 of $ 172.8 million higher net income , partially offset by higher net non-cash benefit of $ 49.7 million . the higher net non-cash benefit of $ 49.7 million in 2019 , compared to 2018 , is comprised of $ 73.4 million higher deferred income tax benefit due to the release of the valuation allowance against our deferred tax assets , $ 0.5 million lower provision for doubtful accounts and $ 0.5 million lower asset impairment , partially offset by higher non-cash charges for $ 8.7 million higher stock-based compensation , $ 6.0 million fees paid for repurchase and exchange of convertible notes due 2023 , $ 2.2 million financing fees on extinguishment of term loans , $ 4.5 million higher depreciation on property and equipment and $ 3.4 million higher non-cash interest expense primarily due to debt discount on notes due 2024. the changes in the working capital year-over-year was neutral as our growth in deferred revenue of $ 78.4 million , including $ 49.9 million of safe harbor prepayments , was offset by our growth in accounts receivable of $ 55.2 million and inventory of $ 25.5 million in 2019 , compared to 2018. cash flows from investing activities for the year ended december 31 , 2019 , net cash used in investing activities was $ 14.8 million , primarily from purchases of test and assembly equipment to expand our supply capacity and related facility improvements , and capitalized costs related to internal-use software .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```cash flows . the following table summarizes our cash flows for the periods presented : replace_table_token_12_th enphase energy , inc. | 2019 form 10-k | 47 c ash flows from operating activities for the year ended december 31 , 2019 , net cash provided by operating activities was $ 139.1 million compared to net cash provided by operating activities of $ 16.1 million in 2018 , an increase of $ 122.9 million year-over-year . the $ 122.9 million increase in net cash provided by operating activities in 2019 compared to 2018 , was primarily due to higher profitability in 2019 of $ 172.8 million higher net income , partially offset by higher net non-cash benefit of $ 49.7 million . the higher net non-cash benefit of $ 49.7 million in 2019 , compared to 2018 , is comprised of $ 73.4 million higher deferred income tax benefit due to the release of the valuation allowance against our deferred tax assets , $ 0.5 million lower provision for doubtful accounts and $ 0.5 million lower asset impairment , partially offset by higher non-cash charges for $ 8.7 million higher stock-based compensation , $ 6.0 million fees paid for repurchase and exchange of convertible notes due 2023 , $ 2.2 million financing fees on extinguishment of term loans , $ 4.5 million higher depreciation on property and equipment and $ 3.4 million higher non-cash interest expense primarily due to debt discount on notes due 2024. the changes in the working capital year-over-year was neutral as our growth in deferred revenue of $ 78.4 million , including $ 49.9 million of safe harbor prepayments , was offset by our growth in accounts receivable of $ 55.2 million and inventory of $ 25.5 million in 2019 , compared to 2018. cash flows from investing activities for the year ended december 31 , 2019 , net cash used in investing activities was $ 14.8 million , primarily from purchases of test and assembly equipment to expand our supply capacity and related facility improvements , and capitalized costs related to internal-use software .
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 Suspicious Activity Report : quality and customer service are the cornerstones of our strategy and were instrumental in our turnaround in financial performance in 2018 and 2019. we began by focusing on call center metrics in the u.s. , europe and australia , and reduced the average wait time from over 10 minutes in 2017 to 2 minutes in 2018 to under 2 minutes by the end of 2019. we introduced self-service tools such as the service-on-the-go that allow our installers and partners to submit requests from their phone in less than 60 seconds . the launch of our iq 7 series microinverter worldwide , the smallest , lightest and most powerful microinverter we have ever made , was a key factor in improving gross margin . every region of the world where our products are sold is now using this seventh-generation microinverter . during year ended december 31 , 2019 , 98 % of our microinverter shipments were iq 7. we systematically rolled out high-power and high-efficiency variants of the iq 7 microinverters in 2018. selling these variants simultaneously improved gross margin and delivered a better price per watt for the installer . enphase energy , inc. | 2019 form 10-k | 40 on january 28 , 2019 , we repaid in full the remaining principal amount of the term loans of approximately $ 39.5 million plus accrued interest and fees owed to lenders affiliated with tennenbaum capital partners , llc . on may 30 , 2019 , we entered into separately and privately negotiated transactions with certain holders of our 4.0 % convertible senior notes due 2023 ( “ notes due 2023 ” ) resulting in the repurchase and exchange , as of june 5 , 2019 , of $ 60.0 million aggregate principal amount of the notes in consideration for the issuance of 10,801,080 shares of common stock and separate cash payments totaling $ 6.0 million . on june 5 , 2019 , we issued $ 132.0 million aggregate principal amount of our 1.0 % convertible senior notes due 2024 ( the “ notes due 2024 ” ) in a private placement . the notes due 2024 are general unsecured obligations and bear interest at a rate of 1.0 % per year , payable semi-annually on june 1 and december 1 of each year , beginning on december 1 , 2019 . the notes due 2024 will mature on june 1 , 2024 , unless earlier repurchased by us or converted at the option of the holders . further information relating to the notes due 2024 may be found in note 11 , “ debt , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k and below under “ liquidity and capital resources . ” 2020 outlook we believe our solid execution in 2019 positions us well to take advantage of future growth opportunities , and we need to maintain our focus in order to capitalize on such opportunities . our top three priorities for 2020 are ( i ) providing a remarkable customer experience , ( ii ) introduction of new products and expansion of our markets , and ( iii ) focus on enhancements to our comprehensive digital platform . customer experience . quality and customer service constitute customer experience . this has remained a priority for three years running . on the service front , our installer , distributor and module partners are our first line of association with our ultimate customer , the homeowner and business user . our goals are to partner better with these service providers so that we can provide exceptional high quality service to our homeowner . we are convinced that continued reinforcement of customer experience improvements can be a competitive advantage for us . introduce new products and expand our market . we are focused on residential solar in a dozen countries providing serviceable available market ( ‘ sam ' ) of approximately $ 3.3 billion in 2019. we also plan to introduce new products in 2020 which will take our sam to $ 12.5 billion in 2022 which will comprise of residential solar , residential storage , small commercial solar and off-grid solar and storage . expand our digital presence . we are focused on generating revenue through digitalization of the business-to-business and business-to-customer process of the partner and customer journey . future key focus is to expand our digital presence through enhancing our online store , increasing the use of the online store significantly , and releasing a comprehensive digital platform . components of consolidated statements of operations net revenues we primarily generate net revenues from sales of our microinverter solutions and related accessories , which can include our ac battery storage systems , our envoy communications gateway and enlighten cloud-based monitoring service as well as other accessories . our revenue is affected by changes in the volume and average selling prices of our solutions and related accessories , supply and demand , sales incentives , and competitive product offerings . our revenue growth is dependent on our ability to compete effectively in the marketplace by remaining cost competitive , developing and introducing new products that meet the changing technology and performance requirements of our customers , the diversification and expansion of our revenue base , and our ability to market our products in a manner that increases awareness for microinverter technology and differentiates us in the marketplace . enphase energy , inc. | 2019 form 10-k | 41 cost of revenues and gross profit cost of revenues is comprised primarily of product costs , warranty , manufacturing personnel and logistics costs , freight costs , depreciation and amortization of test equipment and hosting services costs . our product costs are impacted by technological innovations , such as advances in semiconductor integration and new product introductions , economies of scale resulting in lower component costs , and improvements in production processes and automation . story_separator_special_tag ( as defined in the relevant indenture ) per $ 1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the our common stock and the conversion rate on each such trading day ; or ( 3 ) upon the occurrence of specified corporate events . upon conversion of any of the notes , we will pay or deliver , as the case may be , cash , shares of common stock or a combination of cash and common stock , at our election . in connection with the offering of the notes due 2024 , we entered into privately-negotiated convertible note hedge transactions in order to reduce the potential dilution to our common stock upon any conversion of the notes due 2024 . the total cost of the convertible note hedge transactions was approximately $ 36.3 million . also , concurrently with the offering of the notes due 2024 , we entered into privately-negotiated warrant transactions whereby we issued warrants to acquire shares of our common stock at a strike price of $ 25.2320 rather than the notes due 2024 conversion price of $ 20.5010 . we received approximately $ 29.8 million from the sale of the warrants . as of february 21 , 2020 , the notes due 2024 were not converted into equity , therefore , we had not purchased any shares under the convertible note hedge and the warrants had not been exercised and remain outstanding . if holders of the notes due 2024 are able to convert the debt to equity , and exercise that right , we have asserted our intent and ability to settle the $ 132.0 million aggregate principal amount of the notes due 2024 in cash . see note 11 , “ debt , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k for more information relating to the convertible note hedge transactions and warrants . we believe that our existing cash and cash equivalents and cash flows from our operating activities will be sufficient to meet our anticipated cash needs for at least the next 12 months . story_separator_special_tag style= `` line-height:120 % ; padding-bottom:8px ; padding-top:8px ; text-align : justify ; text-indent:36px ; font-size:10pt ; `` > revenues are recognized when control of the promised goods or services are transferred to our customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or services . we generate all of our revenues from contracts with our customers . a description of principal activities from which we generate revenues are as follows . products delivered at a point in time . we sell our products to customers in accordance with the terms of the related customer contracts . we generate revenues from sales of our solutions , which include microinverter units and related accessories , an envoy communications gateway and enlighten service , communications accessories and ac battery storage solutions to distributors , large installers , oems and strategic partners . microinverter units , microinverter accessories , and ac battery storage solutions are delivered to customers at a point in time , and we recognize revenue for these products when we transfer control of the product to the customer , which is generally upon shipment . products delivered over time . the sale of an envoy communications gateway includes our enlighten cloud-based monitoring service . the full consideration for these products represents a single performance obligation and is deferred at the sale date and recognized over the estimated service period of 6 years . we also sell certain communication accessories that are delivered over time . the revenue from these products is recognized over the related service period , which is typically 5 or 12 years . we previously sold envoy communications device to certain customers under a long-term financing arrangement . under this financing arrangement , we net the unbilled receivables against deferred revenue . we record certain contra revenue promotions as variable consideration and recognizes these promotions at the time the related revenue is recorded . enphase energy , inc. | 2019 form 10-k | 49 we record upfront contract acquisition costs , such as sales commissions , to be capitalized and amortized over the estimated life of the asset . for contracts that have a duration of less than one year , we follow the topic 606 practical expedient and expense these costs when incurred . commissions related to our sale of monitoring hardware and service are capitalized and amortized over the period of the associated revenue . see note 3 . “ revenue recognition , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k for additional information related to revenue recognition . inventory inventory is valued at the lower of cost or market . market is current replacement cost ( by purchase or by reproduction , dependent on the type of inventory ) . in cases where market exceeds net realizable value ( i.e . , estimated selling price less reasonably predictable costs of completion and disposal ) , inventories are stated at net realizable value . market is not considered to be less than net realizable value reduced by an allowance for an approximately normal profit margin . we determine cost on a first-in first-out basis . certain factors could affect the realizable value of its inventory , including customer demand and market conditions . management assesses the valuation on a quarterly basis and writes down the value for any excess and obsolete inventory based upon expected demand , anticipated sales price , effect of new product introductions , product obsolescence , customer concentrations , product merchantability and other factors . inventory write-downs are equal to the difference between the cost of inventories

