Veeco Instruments (VECO) 10-Q 3 Aug 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Jul. 29, 2015
Document and Entity Information
Entity Registrant Name	VEECO INSTRUMENTS INC
Entity Central Index Key	103,145
Document Type	10-Q
Document Period End Date	Jun. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		40,789,271
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q2

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 313,853	$ 270,811
Short-term investments	82,397	120,572
Restricted cash		539
Accounts receivable, net	83,098	60,085
Inventory	63,564	61,471
Deferred cost of sales	24,384	5,076
Prepaid expenses and other current assets	25,976	23,132
Assets held for sale	6,000	6,000
Deferred income taxes	6,479	7,976
Total current assets	605,751	555,662
Property, plant and equipment, net	80,002	78,752
Goodwill	115,256	114,959
Deferred income taxes	1,180	1,180
Intangible assets, net	143,367	159,308
Other assets	20,325	19,594
Total assets	965,881	929,455
Current liabilities:
Accounts payable	46,159	18,111
Accrued expenses and other current liabilities	39,343	48,418
Customer deposits and deferred revenue	128,553	96,004
Income taxes payable	7,750	5,441
Deferred income taxes	120	120
Current portion of long-term debt	327	314
Total current liabilities	222,252	168,408
Deferred income taxes	15,779	16,397
Long-term debt	1,367	1,533
Other liabilities	6,183	4,185
Total liabilities	$ 245,581	$ 190,523
Stockholders' Equity:
Preferred stock, 500,000 shares authorized; no shares issued and outstanding
Common stock, $0.01 par value, 120,000,000 shares authorized; 40,789,138 and 40,360,069 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively	$ 408	$ 404
Additional paid-in capital	759,004	750,139
Accumulated deficit	(40,576)	(13,080)
Accumulated other comprehensive income	1,464	1,469
Total stockholders' equity	720,300	738,932
Total liabilities and stockholders' equity	$ 965,881	$ 929,455

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2015	Dec. 31, 2014
Consolidated Balance Sheets
Preferred stock, shares authorized	500,000	500,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, authorized shares	120,000,000	120,000,000
Common stock, shares issued	40,789,138	40,360,069
Common stock, shares outstanding	40,789,138	40,360,069

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Consolidated Statements of Operations
Net sales	$ 131,410	$ 95,122	$ 229,751	$ 185,963
Cost of sales	82,341	64,449	145,545	121,513
Gross profit	49,069	30,673	84,206	64,450
Operating expenses, net:
Selling, general, and administrative	24,365	21,891	47,247	43,558
Research and development	20,119	21,011	38,704	40,779
Amortization of intangible assets	7,979	2,899	15,941	5,802
Restructuring	683	801	3,040	1,193
Asset impairment			126
Changes in contingent consideration				(29,368)
Other, net	(51)	(158)	(1,002)	(370)
Total operating expenses, net	53,095	46,444	104,056	61,594
Operating income (loss)	(4,026)	(15,771)	(19,850)	2,856
Interest income	243	180	530	386
Interest expense	(124)	(108)	(250)	(150)
Income (loss) before income taxes	(3,907)	(15,699)	(19,570)	3,092
Income tax expense (benefit)	4,479	(488)	7,926	(857)
Net income (loss)	$ (8,386)	$ (15,211)	$ (27,496)	$ 3,949
Income (loss) per common share:
Basic (in dollars per share)	$ (0.21)	$ (0.39)	$ (0.69)	$ 0.10
Diluted (in dollars per share)	$ (0.21)	$ (0.39)	$ (0.69)	$ 0.10
Weighted average number of shares:
Basic (in shares)	39,693	39,379	39,666	39,275
Diluted (in shares)	39,693	39,379	39,666	40,061

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Consolidated Statements of Comprehensive Income (Loss)
Net income (loss)	$ (8,386)	$ (15,211)	$ (27,496)	$ 3,949
Other comprehensive income ( loss), net of tax
Unrealized gain (loss) on available-for-sale securities	(7)	71	26	121
Less: Reclassification adjustments for gains included in net income	(1)	(45)	(1)	(45)
Currency translation gain (loss)	(15)	(24)	(30)	109
Other comprehensive income (loss), net of tax	(23)	2	(5)	185
Comprehensive income (loss)	$ (8,409)	$ (15,209)	$ (27,501)	$ 4,134

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Cash Flows from Operating Activities
Net income (loss)	$ (27,496)	$ 3,949
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	21,725	11,600
Deferred income taxes	879	(2,675)
Asset impairment	126
Share-based compensation expense	8,919	9,813
Provision of bad debts		(1,936)
Gain on sale of lab tools	(179)	(2,435)
Change in contingent consideration		(29,368)
Changes in operating assets and liabilities:
Accounts receivable	(22,709)	(32,721)
Inventory and deferred cost of sales	(21,269)	7,062
Prepaid expenses and other current assets	(2,844)	(1,631)
Accounts payable and accrued expenses	19,041	(1,214)
Customer deposits and deferred revenue	31,599	22,826
Income taxes receivable and payable, net	2,309	646
Other, net	1,860	(692)
Net cash provided by (used in) operating activities	11,961	(16,776)
Cash Flows from Investing Activities
Capital expenditures	(7,530)	(4,509)
Proceeds from the liquidation of short-term investments	50,147	121,233
Payments for purchases of short-term investments	(11,998)	(92,029)
Proceeds from sale of lab tools	1,533	7,034
Other	(865)	(685)
Net cash provided by investing activities	31,287	31,044
Cash Flows from Financing Activities
Proceeds from stock option exercises	1,157	9,125
Payments of tax withholdings - restricted shares	(1,180)	(1,867)
Repayments of long-term debt	(153)	(141)
Net cash provided by (used in) financing activities	(176)	7,117
Effect of exchange rate changes on cash and cash equivalents	(30)	148
Net increase in cash and cash equivalents	43,042	21,533
Cash and cash equivalents - beginning of period	270,811	210,799
Cash and cash equivalents - end of period	313,853	232,332
Supplemental information:
Interest paid	71	82
Income taxes paid	$ 2,625	$ 1,999

Basis of Presentation

Basis of Presentation	6 Months Ended
	Jun. 30, 2015
Basis of Presentation
Basis of Presentation	Note 1 - Basis of Presentation The accompanying unaudited Consolidated Financial Statements of Veeco have been prepared in accordance with U.S. GAAP as defined in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 270 for interim financial information and with the instructions to Rule 10-01 of Securities and Exchange Commission Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements as the interim information is an update of the information that was presented in the most recent annual financial statements. For further information, refer to Veeco’s Consolidated Financial Statements and Notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2014 (“2014 Form 10-K”). In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal, recurring nature. C ertain amounts previously reported have been reclassified in the financial statements to conform to the current presentation. Veeco reports interim quarters on a 13-week basis ending on the last Sunday of each quarter. The fourth quarter always ends on the last day of the calendar year, December 31. The 2015 interim quarters end on March 29, June 28, and September 27, and the 2014 interim quarters ended on March 30, June 29, and September 28. These interim quarters are reported as March 31, June 30 and September 30 in Veeco’s interim consolidated financial statements. Revenue recognition Veeco sells systems, maintenance, service, components, and spare parts. Veeco recognizes revenue when all of the following criteria have been met: persuasive evidence of an arrangement exists with a customer; delivery of the specified products has occurred or services have been rendered; prices are contractually fixed or determinable; and collectability is reasonably assured. Revenue is recorded including shipping and handling costs and excluding applicable taxes related to sales. Contracts with customers frequently contain multiple deliverables. Judgment is required to properly identify the accounting units of the multiple-element arrangements and to determine how the revenue should be allocated among the accounting units. Veeco also evaluates whether multiple transactions with the same customer or related parties should be considered part of a single, multiple-element arrangement based on an assessment of whether the contracts or agreements are negotiated or executed within a short time frame of each other or if there are indicators that the contracts are negotiated in contemplation of one another. Moreover, judgment is used in interpreting the commercial terms and determining when all criteria have been met in order to recognize revenue in the appropriate accounting period. When there are separate units of accounting, Veeco allocates revenue to each element based on the following selling price hierarchy: vendor-specific objective evidence (“VSOE”) if available; third party evidence (“TPE”) if VSOE is not available; or the best estimate of selling price (“BESP”) if neither VSOE nor TPE is available. BESP is used for the majority of the elements in Veeco’s arrangements. The maximum revenue recognized on a delivered element is limited to the amount that is not contingent upon the delivery of additional items. Veeco considers many facts when evaluating each of its sales arrangements to determine the timing of revenue recognition including its contractual obligations, the customer’s creditworthiness, and the nature of the customer’s post-delivery acceptance provisions. Veeco’s system sales arrangements, including certain upgrades, generally include field acceptance provisions that may include functional or mechanical test procedures. For the majority of the arrangements, a customer source inspection of the system is performed in Veeco’s facility or test data is sent to the customer documenting that the system is functioning to the agreed upon specifications prior to delivery. Historically, such source inspection or test data replicates the field acceptance provisions that are performed at the customer’s site prior to final acceptance of the system. When Veeco objectively demonstrates that the criteria specified in the contractual acceptance provisions are achieved prior to delivery, revenue is recognized upon system delivery since there is no substantive contingency remaining related to the acceptance provisions at that date, subject to the retention amount constraint described below. For new products, new applications of existing products, or for products with substantive customer acceptance provisions where Veeco can not objectively demonstrate that the criteria specified in the contractual acceptance provisions have been achieved prior to delivery, revenue and the associated costs are fully deferred and recognized upon the receipt of final customer acceptance, assuming all other revenue recognition criteria have been met. System sales arrangements, including certain upgrades, generally do not contain provisions for the right of return, forfeiture, refund, or other purchase price concessions. In the rare instances where such provisions are included, all revenue is deferred until such rights expire. The sales arrangements generally include installation. The installation process is not deemed essential to the functionality of the equipment since it is not complex; it does not require significant changes to the features or capabilities of the equipment or involve constructing elaborate interfaces or connections subsequent to factory acceptance. Veeco has a demonstrated history of consistently completing installations in a timely manner and can reliably estimate the costs of such activities. Most customers engage Veeco to perform the installation services, although there are other third-party providers with sufficient knowledge who could complete these services. Based on these factors, installation is deemed to be inconsequential or perfunctory relative to the system sale as a whole, and as a result, installation service is not considered a separate element of the arrangement. As such, Veeco accrues the cost of the installation at the time of revenue recognition for the system. In many cases Veeco’s products are sold with a billing retention, typically 10% of the sales price which is payable by the customer when field acceptance provisions are completed. The amount of revenue recognized upon delivery of a system or upgrade, if any, is limited to the lower of i) the amount billed that is not contingent upon acceptance provisions or ii) the value of the arrangement consideration allocated to the delivered elements, if such sale is part of a multiple-element arrangement. Veeco’s contractual terms with customers in Japan generally specify that title and risk and rewards of ownership transfer upon customer acceptance. As a result, for customers in Japan, revenue is recognized upon the receipt of written customer acceptance. A distributor is used for almost all product and service sales to customers in Japan. Title passes to the distributor upon shipment, however, due to customary local business practices, the risk and rewards of ownership of the system transfers to the end customers upon their acceptance. As such, Veeco recognizes revenue upon receipt of written acceptance from the end customer. Veeco recognizes revenue related to maintenance and service contracts ratably over the applicable contract term. Revenue from the sales of components, spare parts, and specified service engagements is recognized at the time of delivery in accordance with the terms of the applicable sales arrangement. Incremental direct costs incurred related to the acquisition of a customer contract, such as sales commissions, are expensed as incurred, even if the related revenue is deferred in accordance with the above policy. Recent accounting pronouncements In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09: Revenue from Contracts with Customers (the “Update”). The Update requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Update outlines a five-step model to make the revenue recognition determination and requires new financial statement disclosures. Publicly-traded companies are required to adopt the Update for reporting periods beginning after December 15, 2016; however the FASB recently approved a one-year deferral of the Update. The FASB expects to issue its final ASU formally amending the effective date by the end of the third quarter of 2015. Currently, companies may choose among different transition alternatives. Veeco is evaluating the impact of adopting the Update on its consolidated financial statements and related financial statement disclosures and has not yet determined which method of adoption will be selected. Veeco is also evaluating other pronouncements recently issued but not yet adopted. The adoption of these pronouncements is not expected to have a material impact on Veeco’s consolidated financial statements.

Income (Loss) Per Common Share

Income (Loss) Per Common Share	6 Months Ended
	Jun. 30, 2015
Income (Loss) Per Common Share
Income (Loss) Per Common Share	Note 2 - Income (Loss) Per Common Share Basic income (loss) per common share is calculated by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted income per common share is calculated by dividing net income available to common stockholders by the weighted average number of common shares and common share equivalents outstanding during the period. For the three and six months ended June 30, 2015, and for the three months ended June 30, 2014, 1.1 million shares of nonvested, participating, restricted share awards and units were excluded from the computation of basic net loss per share since the securities’ holders are not obligated to fund these losses. The dilutive effect of outstanding options to purchase common stock, restricted share awards, and restricted share units is considered in diluted income per common share by application of the treasury stock method. The dilutive effect of outstanding performance share awards and units are included in income per common share when performance targets have been achieved. The computations of basic and diluted income (loss) per common share are: Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands, except per share data) Net income (loss) $ ) $ ) $ ) $ Net income (loss) per common share: Basic $ ) $ ) $ ) $ Diluted $ ) $ ) $ ) $ Basic weighted average shares outstanding Effect of potentially dilutive share-based awards — — — Diluted weighted average shares outstanding Shares excluded from diluted calculation since Veeco incurred a net loss as their effect would be antidilutive — Potentially dilutive non-participating shares excluded from diluted calculation as their effect would be antidilutive

Assets

Assets	6 Months Ended
	Jun. 30, 2015
Assets
Assets	Note 3 - Assets Investments and Assets held for sale Marketable securities are generally classified as available-for-sale and reported at fair value, with unrealized gains and losses, net of tax, presented as a separate component of stockholders’ equity under the caption “Accumulated other comprehensive income.” These securities may include U.S. treasuries, government agency securities, corporate debt, and commercial paper, all with maturities of greater than three months when purchased. All realized gains and losses and unrealized losses resulting from declines in fair value that are other than temporary are included in “Other, net” in the Consolidated Statements of Operations. Fair value is the price that would be received for an asset or the amount paid to transfer a liability in an orderly transaction between market participants. Veeco classifies certain assets based on the following fair value hierarchy: Level 1: Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2: Quoted prices for identical assets and liabilities in markets that are not active, quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly; and Level 3: Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. The level used within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Veeco has evaluated the estimated fair value of financial instruments using available market information and valuations as provided by third-party sources. In determining fair value, information from pricing services is utilized to value securities based on quoted market prices in active markets and matrix pricing. Matrix pricing is a mathematical valuation technique that does not rely exclusively on quoted prices of specific investments, but on the investment’s relationship to other benchmarked quoted securities. The use of different market assumptions and/or estimation methodologies could have a significant effect on the fair value estimates. The following table presents assets (excluding cash and cash equivalent balances) that are measured at fair value on a recurring basis: Level 1 Level 2 Total (in thousands) June 30, 2015 U.S. treasuries $ $ — $ Government agency securities — Corporate debt — December 31, 2014 U.S. treasuries $ $ — $ Corporate debt — There were no transfers between fair value measurement levels during the six months ended June 30, 2015. There were no financial assets or liabilities measured at fair value using Level 3 fair value measurements at June 30, 2015 or December 31, 2014. The amortized cost and fair value of available-for-sale securities consist of: Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value (in thousands) June 30, 2015 U.S. treasuries $ $ $ — $ Government agency securities — — Corporate debt ) Total available-for-sale securities $ $ $ ) $ December 31, 2014 U.S. treasuries $ $ $ ) $ Corporate debt ) Total available-for-sale securities $ $ $ ) $ Available-for-sale securities in a loss position consist of: June 30, 2015 December 31, 2014 Gross Gross Estimated Unrealized Estimated Unrealized Fair Value Losses Fair Value Losses (in thousands) U.S. treasuries $ — $ — $ $ ) Corporate debt ) ) Total available-for-sale securities in a loss position $ $ ) $ $ ) At June 30, 2015 and December 31, 2014, there were no short-term investments that had been in a continuous loss position for more than 12 months. The contractual maturities of securities classified as available-for-sale are: June 30, 2015 Amortized cost Estimated fair value (in thousands) Due in one year or less $ $ Due after one year through two years Total available-for-sale securities $ $ Actual maturities may differ from contractual maturities. Veeco may sell these securities prior to maturity based on the needs of the business. In addition, borrowers may have the right to call or prepay obligations prior to scheduled maturities. There were minimal realized gains for the three and six months ended June 30, 2015 and June 30, 2014. The cost of securities liquidated is based on specific identification. Accounts receivable Accounts receivable is presented net of allowance for doubtful accounts of $0.5 million and $0.7 million at June 30, 2015 and December 31, 2014, respectively. Inventory Inventory is stated at the lower of cost or market approximating actual costs using a first-in, first-out basis. Inventory consists of: June 30, 2015 December 31, 2014 (in thousands) Materials $ $ Work-in-process Finished goods Total inventory $ $ Deferred cost of sales For new products, new applications of existing products or for products with substantive customer acceptance provisions where Veeco can not objectively demonstrate that the criteria specified in the contractual acceptance provisions have been achieved prior to delivery, revenue and the associated costs are deferred and fully recognized upon the receipt of final customer acceptance, assuming all other revenue recognition criteria have been met. Prepaid expenses and other current assets Prepaid expenses and other current assets primarily consist of supplier deposits, as well as prepaid value-added tax, lease deposits, prepaid insurance, and prepaid licenses. Veeco outsources a majority of its manufacturing to third parties. For outsourced products, Veeco maintains a minimum level of internal manufacturing capability. Supplier deposits were $15.2 million and $12.7 million at June 30, 2015 and December 31, 2014, respectively. Assets held for sale Research and demonstration laboratories in Asia, as well as a vacant building and land, were designated as held for sale during 2014. The carrying value reflects Veeco’s estimate of fair value less costs to sell using the sales comparison market approach. Property, plant, and equipment Property, plant, and equipment consist of: June 30, 2015 December 31, 2014 (in thousands) Land $ $ Building and improvements Machinery and equipment Leasehold improvements Gross property, plant and equipment Less: accumulated depreciation and amortization Net property, plant, and equipment $ $ For the three and six months ended June 30, 2015, depreciation expense was $3.0 million and $5.8 million, respectively, and $2.9 million and $5.8 million for the comparable 2014 periods. At June 30, 2015 and December 31, 2014, the carrying value of systems that had previously been used in Veeco’s laboratories as Veeco Certified Equipment was approximately $1.0 million and $1.3 million, respectively, and was included in “property, plant, and equipment” in the Consolidated Balance Sheets. These held-for-sale systems are the same types of tools that Veeco sells to customers in the ordinary course of business. When these systems are sold, sales proceeds and the associated costs are included in “Net sales” and “Cost of sales” in the Consolidated Statements of Operations. Goodwill There were no new acquisitions or impairments during the six months ended June 30, 2015. The purchase accounting related to the $145.5 million December 4, 2014 acquisition of Solid State Equipment LLC (“SSEC”), which has been renamed Veeco Precision Surface Processing LLC (“PSP”), remains preliminary. The estimated fair value of the assets acquired and liabilities assumed may be adjusted as further information becomes available during the measurement period of up to 12 months from the acquisition date. Changes in goodwill consist of: Gross carrying Accumulated amount impairment Net amount (in thousands) Goodwill - December 31, 2014 $ $ $ Purchase price allocation adjustment — Goodwill - June 30, 2015 $ $ $ Intangible assets There were no new acquisitions or impairments during the six months ended June 30, 2015. The components of purchased intangible assets consist of: June 30, 2015 December 31, 2014 Accumulated Accumulated Gross Amortization Gross Amortization Carrying and Net Carrying and Net Amount Impairment Amount Amount Impairment Amount (in thousands) Technology $ $ $ $ $ $ Customer relationships Trademarks and tradenames Indefinite-lived trademark — — Other Total $ $ $ $ $ $ Other intangible assets consist of patents, licenses, customer backlog, and non-compete agreements. Other assets Veeco has an ownership interest of less than 20% in a non-marketable investment. Veeco does not exert significant influence over the investee, and therefore the investment is carried at cost. An additional investment of $0.8 million was made during the three months ended June 30, 2015, increasing the carrying value of the investment from $19.4 million at December 31, 2014 to $20.2 million at June 30, 2015. Subsequent to June 30, 2015, Veeco participated in a new round of financing by investing an additional $0.8 million. Veeco’s ownership interest and participating rights have not changed. Therefore, Veeco continues to carry the investment at cost. The investment is subject to a periodic impairment review; as there are no open-market valuations, the impairment analysis requires significant judgment. The analysis includes assessments of the investee’s financial condition, the business outlook for its products and technology, its projected results and cash flow, business valuation indications from recent rounds of financing, the likelihood of obtaining subsequent rounds of financing, and the impact of equity preferences held by Veeco or other investors. Fair value of the investment is not estimated unless there are identified events or changes in circumstances that could have a significant adverse effect on the fair value of the investment. No such events or circumstances are present.

Liabilities

Liabilities	6 Months Ended
	Jun. 30, 2015
Liabilities
Liabilities	Note 4 - Liabilities Accrued expenses and other current liabilities The components of accrued expenses and other current liabilities consist of: June 30, 2015 December 31, 2014 (in thousands) Payroll and related benefits $ $ Warranty Installation Sales, use, and other taxes Professional fees Restructuring liability Other Total accrued liabilities $ $ Other liabilities include accruals for costs related to customer training, royalties, and travel. Warranty reserves Warranties are typically valid for one year from the date of system final acceptance. Estimated warranty costs are determined by analyzing specific product and historical configuration statistics and regional warranty support costs. The estimate is affected by product failure rates, material usage, and labor costs incurred in correcting product failures during the warranty period. Unforeseen component failures or exceptional component performance can impact warranty costs. Changes in product warranty reserves include: (in thousands) Warranty reserves - December 31, 2014 $ Warranties issued Settlements made ) Changes in estimate ) Warranty reserves - June 30, 2015 $ Restructuring accruals During the six months ended June 30, 2015, additional accruals were recognized and payments made related to the 2014 closing of Veeco’s Ft. Collins, Colorado and Camarillo, California facilities. Business activities formerly conducted at these sites have been transferred to the Plainview, New York facility. In addition, Veeco is closing the Hyeongok-ri, South Korea facility. Veeco has accrued and paid for restructuring activities during the six months ended June 30, 2015. Additional restructuring costs to be accrued for these activities are not expected to be significant. Personnel Severance and Facility Related Costs Closing Costs Total (in thousands) Restructuring accrual - December 31, 2014 $ $ — $ Provision Payments ) ) ) Restructuring accrual - June 30, 2015 $ $ $ Customer deposits and deferred revenue Customer deposits totaled $57.0 million and $73.0 million at June 30, 2015 and December 31, 2014, respectively. The remainder of the balance relates to deferred revenue consisting of billings associated with customer contracts for which all revenue recognition criteria have not yet been met. Long-term debt Debt consists of a mortgage note payable with a carrying value of $1.7 million at June 30, 2015 and $1.8 million at December 31, 2014. The annual interest rate on the mortgage is 7.91%, and the final payment is due on January 1, 2020. The mortgage note payable is secured by certain land and buildings. The property associated with the mortgage is currently held for sale. A discounted cash flow model was used to calculate a level 3 fair value estimate of $1.8 million at June 30, 2015 and $2.0 million at December 31, 2014.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2015
Commitments and Contingencies
Commitments and Contingencies	Note 5 - Commitments and Contingencies Minimum lease commitments At June 30, 2015, Veeco’s total future minimum lease payments under non-cancelable operating leases have not changed significantly from the footnote disclosure in the 2014 Form 10-K. Purchase commitments Veeco has purchase commitments under certain contractual arrangements to make future payments for goods and services. These contractual arrangements secure the rights to various assets and services to be used in the future in the normal course of business. Veeco has purchase commitments of $123.4 million at June 30, 2015, substantially all of which become due within one year. Bank guarantees and letters of credit Veeco has bank guarantees and letters of credit issued by a financial institution on its behalf as needed to cover performance bonds required by customers . At June 30, 2015, outstanding bank guarantees and letters of credit totaled $36.2 million, and unused letters of credit of $30.9 million were available to be drawn upon. Legal proceedings Veeco and certain other parties were named as defendants in a lawsuit filed on April 25, 2013 in the Superior Court of California, County of Sonoma. The plaintiff in the lawsuit, Patrick Colbus, seeks unspecified damages and asserts claims that he suffered burns and other injuries while he was cleaning a molecular beam epitaxy system alleged to have been manufactured by Veeco. The lawsuit alleges, among other things, that the molecular beam epitaxy system was defective and that Veeco failed to adequately warn of the potential risks of the system. Veeco believes this lawsuit is without merit and intends to defend vigorously against the claims. Veeco is unable to predict the outcome of this action or to reasonably estimate the possible loss or range of loss, if any, arising from the claims asserted therein. Veeco believes that, in the event of any recovery by the plaintiff from Veeco, such recovery would be fully covered by insurance. Veeco is involved in other legal proceedings arising in the normal course of business. The resolution of these matters is not expected to have a material adverse effect on Veeco’s consolidated financial position, results of operations, or cash flows.

Equity

Equity	6 Months Ended
	Jun. 30, 2015
Equity
Equity	Note 6 - Equity Accumulated Other Comprehensive Income (“AOCI”) The following table presents the changes in the balances of each component of AOCI, net of tax: Currency translation gain (loss) Minimum Pension Liability Unrealized Gains on Available-for-sale Securities Total (in thousands) Balance at December 31, 2014 $ $ ) $ $ Other comprehensive income (loss) before reclassifications ) — ) Amounts reclassified from AOCI — — ) ) Other comprehensive income (loss) ) — ) Balance at June 30, 2015 $ $ ) $ $ Veeco did not allocate tax expense to other comprehensive income for the six months ended June 30, 2015 as Veeco is in a full valuation allowance position such that a deferred tax asset related to amounts recognized in other comprehensive income is not regarded as realizable on a more-likely-than-not basis.

Share-based compensation

Share-based compensation	6 Months Ended
	Jun. 30, 2015
Share-based compensation
Share-based compensation	Note 7 - Share-based compensation Restricted share awards are issued to employees that are subject to specified restrictions and a risk of forfeiture. The restrictions typically lapse over one to five years and entitle holders to both dividends and voting rights. Other types of share-based compensation include performance share awards, performance share units, and restricted share units (collectively with restricted share awards, “restricted shares”), as well as options to purchase common stock. Share-based compensation expense was recognized in the following line items in the Consolidated Statements of Operations: Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands) Cost of sales $ $ $ $ Selling, general, and administrative Research and development Total share-based compensation expense $ $ $ $ Equity activity related to restricted shares: Weighted Average Grant Date Number of Shares Fair Value (in thousands) Restricted shares outstanding - December 31, 2014 $ Granted Vested ) Forfeited ) Restricted shares outstanding - June 30, 2015 $ Equity activity related to stock options: Weighted Average Number of Shares Exercise Price (in thousands) Stock options outstanding - December 31, 2014 $ Granted Exercised ) Expired or forfeited ) Stock options outstanding - June 30, 2015 $

Income Taxes

Income Taxes	6 Months Ended
	Jun. 30, 2015
Income Taxes
Income Taxes	Note 8 - Income Taxes Income taxes are estimated for each of the jurisdictions in which Veeco operates. Deferred income taxes reflect the net tax effect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as the tax effect of carry forwards. A valuation allowance is recorded to reduce deferred tax assets to the amount that is more likely than not to be realized. Realization of net deferred tax assets is dependent on future taxable income. At the end of each interim reporting period, the effective tax rate is aligned to expectations for the full year. This estimate is used to determine the income tax provision or benefit on a year-to-date basis and may change in subsequent interim periods. Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands) Income (loss) before income taxes $ ) $ ) $ ) $ Income tax expense (benefit) $ $ ) $ $ ) For the three months ended June 30, 2015, the net expense for income taxes included a $3.3 million provision relating to Veeco’s domestic operations and a $1.2 million provision relating to foreign operations. For the six months ended June 30, 2015, the net expense for income taxes included a $5.3 million provision relating to domestic operations and a $2.6 million provision relating to foreign operations. Although there was a domestic pre-tax loss for the period, Veeco did not provide a current tax benefit on such losses as the amounts are not realizable on a more-likely-than-not basis. In addition, Veeco provided withholding taxes and a domestic provision relating to certain deferred tax liabilities that could not be offset against its deferred tax assets. Veeco’s foreign operations are profitable. As such, taxes were provided at rates which approximate the statutory rates of those foreign jurisdictions. For the three and six months ended June 30, 2014, the effective tax rate was different than the statutory tax rate primarily due to the recognition of only a portion of Veeco’s U.S. deferred tax assets on a more-likely-than-not basis with respect to 2014 domestic pre-tax losses. In addition, for the six months ended June 30, 2014, the effective tax rate was also impacted because a tax provision was not provided on the gain from the settlement of the contingent consideration related to the Synos acquisition.

Segment Reporting and Geographi

Segment Reporting and Geographic Information	6 Months Ended
	Jun. 30, 2015
Segment Reporting and Geographic Information
Segment Reporting and Geographic Information	Note 9 - Segment Reporting and Geographic Information Veeco operates and measures its results in one operating segment and therefore has one reportable segment: the design, development, manufacture, and support of thin film process equipment primarily sold to make electronic devices. Veeco categorizes its sales into the following four markets: Lighting, Display & Power Electronics (“Energy Conservation”) Lighting refers to Light Emitting Diode (“LED”); semiconductor illumination sources used in various applications including backlights, general lighting, automotive running lights, and head lamps. Display refers to LED displays and Organic Light Emitting Diode (“OLED”) displays. Power Electronics refers to semiconductor devices such as rectifiers, inverters, and converters for the control and conversion of electric power. Advanced Packaging, MEMS & RF (“Mobility”) Advanced Packaging includes a portfolio of wafer-level assembly technologies that enable the miniaturization and performance improvement of electronic products, such as smartphones, smartwatches, tablets, and laptops. Micro-Electro Mechanical Systems (“MEMS”) includes tiny mechanical devices such as sensors, switches, mirrors, and actuators embedded in semiconductor chips used in vehicles, smartphones, tablets, and games. Radio Frequency (“RF”) includes semiconductor devices that make use of radio waves (RF fields) for wireless broadcasting and/or communications. Scientific & Industrial Scientific refers to university research institutions, industry research institutions, industry consortiums, and government research agencies. Industrial refers to large-scale product manufacturing including optical coatings: thin layers of material deposited on a lens or mirror that alters how light reflects and transmits; photomask: an opaque plate that allows light to shine through in a defined pattern for use in photolithography; and front end semiconductor: early steps in the process of integrated circuit fabrication where the microchips are created but still remain on the silicon wafer. Data Storage The Data Storage market refers to the archiving of data in electromagnetic or other forms for use by a computer or device, including hard disk drives used in large capacity storage applications. Revenue by market: Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands) Lighting, Display & Power Electronics $ $ $ $ Advanced Packaging, MEMS & RF Scientific & Industrial Data Storage Total Sales $ $ $ $ Significant operations outside the United States include sales and service offices in the Asia-Pacific and Europe regions. For geographic reporting, revenues are attributed to the location in which the customer facility is located as follows: Revenue by geography: Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands) United States $ $ $ $ China EMEA (1) Rest of World Total Sales $ $ $ $ (1) EMEA consists of Europe, the Middle East, and Africa

Basis of Presentation (Policies

Basis of Presentation (Policies)	6 Months Ended
	Jun. 30, 2015
Basis of Presentation
Revenue Recognition	Revenue recognition Veeco sells systems, maintenance, service, components, and spare parts. Veeco recognizes revenue when all of the following criteria have been met: persuasive evidence of an arrangement exists with a customer; delivery of the specified products has occurred or services have been rendered; prices are contractually fixed or determinable; and collectability is reasonably assured. Revenue is recorded including shipping and handling costs and excluding applicable taxes related to sales. Contracts with customers frequently contain multiple deliverables. Judgment is required to properly identify the accounting units of the multiple-element arrangements and to determine how the revenue should be allocated among the accounting units. Veeco also evaluates whether multiple transactions with the same customer or related parties should be considered part of a single, multiple-element arrangement based on an assessment of whether the contracts or agreements are negotiated or executed within a short time frame of each other or if there are indicators that the contracts are negotiated in contemplation of one another. Moreover, judgment is used in interpreting the commercial terms and determining when all criteria have been met in order to recognize revenue in the appropriate accounting period. When there are separate units of accounting, Veeco allocates revenue to each element based on the following selling price hierarchy: vendor-specific objective evidence (“VSOE”) if available; third party evidence (“TPE”) if VSOE is not available; or the best estimate of selling price (“BESP”) if neither VSOE nor TPE is available. BESP is used for the majority of the elements in Veeco’s arrangements. The maximum revenue recognized on a delivered element is limited to the amount that is not contingent upon the delivery of additional items. Veeco considers many facts when evaluating each of its sales arrangements to determine the timing of revenue recognition including its contractual obligations, the customer’s creditworthiness, and the nature of the customer’s post-delivery acceptance provisions. Veeco’s system sales arrangements, including certain upgrades, generally include field acceptance provisions that may include functional or mechanical test procedures. For the majority of the arrangements, a customer source inspection of the system is performed in Veeco’s facility or test data is sent to the customer documenting that the system is functioning to the agreed upon specifications prior to delivery. Historically, such source inspection or test data replicates the field acceptance provisions that are performed at the customer’s site prior to final acceptance of the system. When Veeco objectively demonstrates that the criteria specified in the contractual acceptance provisions are achieved prior to delivery, revenue is recognized upon system delivery since there is no substantive contingency remaining related to the acceptance provisions at that date, subject to the retention amount constraint described below. For new products, new applications of existing products, or for products with substantive customer acceptance provisions where Veeco can not objectively demonstrate that the criteria specified in the contractual acceptance provisions have been achieved prior to delivery, revenue and the associated costs are fully deferred and recognized upon the receipt of final customer acceptance, assuming all other revenue recognition criteria have been met. System sales arrangements, including certain upgrades, generally do not contain provisions for the right of return, forfeiture, refund, or other purchase price concessions. In the rare instances where such provisions are included, all revenue is deferred until such rights expire. The sales arrangements generally include installation. The installation process is not deemed essential to the functionality of the equipment since it is not complex; it does not require significant changes to the features or capabilities of the equipment or involve constructing elaborate interfaces or connections subsequent to factory acceptance. Veeco has a demonstrated history of consistently completing installations in a timely manner and can reliably estimate the costs of such activities. Most customers engage Veeco to perform the installation services, although there are other third-party providers with sufficient knowledge who could complete these services. Based on these factors, installation is deemed to be inconsequential or perfunctory relative to the system sale as a whole, and as a result, installation service is not considered a separate element of the arrangement. As such, Veeco accrues the cost of the installation at the time of revenue recognition for the system. In many cases Veeco’s products are sold with a billing retention, typically 10% of the sales price which is payable by the customer when field acceptance provisions are completed. The amount of revenue recognized upon delivery of a system or upgrade, if any, is limited to the lower of i) the amount billed that is not contingent upon acceptance provisions or ii) the value of the arrangement consideration allocated to the delivered elements, if such sale is part of a multiple-element arrangement. Veeco’s contractual terms with customers in Japan generally specify that title and risk and rewards of ownership transfer upon customer acceptance. As a result, for customers in Japan, revenue is recognized upon the receipt of written customer acceptance. A distributor is used for almost all product and service sales to customers in Japan. Title passes to the distributor upon shipment, however, due to customary local business practices, the risk and rewards of ownership of the system transfers to the end customers upon their acceptance. As such, Veeco recognizes revenue upon receipt of written acceptance from the end customer. Veeco recognizes revenue related to maintenance and service contracts ratably over the applicable contract term. Revenue from the sales of components, spare parts, and specified service engagements is recognized at the time of delivery in accordance with the terms of the applicable sales arrangement. Incremental direct costs incurred related to the acquisition of a customer contract, such as sales commissions, are expensed as incurred, even if the related revenue is deferred in accordance with the above policy.
Recent Accounting Pronouncements	Recent accounting pronouncements In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09: Revenue from Contracts with Customers (the “Update”). The Update requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Update outlines a five-step model to make the revenue recognition determination and requires new financial statement disclosures. Publicly-traded companies are required to adopt the Update for reporting periods beginning after December 15, 2016; however the FASB recently approved a one-year deferral of the Update. The FASB expects to issue its final ASU formally amending the effective date by the end of the third quarter of 2015. Currently, companies may choose among different transition alternatives. Veeco is evaluating the impact of adopting the Update on its consolidated financial statements and related financial statement disclosures and has not yet determined which method of adoption will be selected. Veeco is also evaluating other pronouncements recently issued but not yet adopted. The adoption of these pronouncements is not expected to have a material impact on Veeco’s consolidated financial statements.

Income (Loss) Per Common Share

Income (Loss) Per Common Share (Tables)	6 Months Ended
	Jun. 30, 2015
Income (Loss) Per Common Share
Schedule of basic and diluted net income (loss) per common share and weighted average shares	Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands, except per share data) Net income (loss) $ ) $ ) $ ) $ Net income (loss) per common share: Basic $ ) $ ) $ ) $ Diluted $ ) $ ) $ ) $ Basic weighted average shares outstanding Effect of potentially dilutive share-based awards — — — Diluted weighted average shares outstanding Shares excluded from diluted calculation since Veeco incurred a net loss as their effect would be antidilutive — Potentially dilutive non-participating shares excluded from diluted calculation as their effect would be antidilutive

Assets (Tables)

Assets (Tables)	6 Months Ended
	Jun. 30, 2015
Assets
Schedule of assets (excluding cash balances) that are measured at fair value on a recurring basis	Level 1 Level 2 Total (in thousands) June 30, 2015 U.S. treasuries $ $ — $ Government agency securities — Corporate debt — December 31, 2014 U.S. treasuries $ $ — $ Corporate debt —
Schedule of amortized cost and fair value of available-for-sale securities	Gross Gross Amortized Unrealized Unrealized Estimated Cost Gains Losses Fair Value (in thousands) June 30, 2015 U.S. treasuries $ $ $ — $ Government agency securities — — Corporate debt ) Total available-for-sale securities $ $ $ ) $ December 31, 2014 U.S. treasuries $ $ $ ) $ Corporate debt ) Total available-for-sale securities $ $ $ ) $
Summary of fair value and unrealized losses of available-for-sale securities in a loss position	June 30, 2015 December 31, 2014 Gross Gross Estimated Unrealized Estimated Unrealized Fair Value Losses Fair Value Losses (in thousands) U.S. treasuries $ — $ — $ $ ) Corporate debt ) ) Total available-for-sale securities in a loss position $ $ ) $ $ )
Schedule of contractual maturities of available-for-sale securities	June 30, 2015 Amortized cost Estimated fair value (in thousands) Due in one year or less $ $ Due after one year through two years Total available-for-sale securities $ $
Schedule of inventory	June 30, 2015 December 31, 2014 (in thousands) Materials $ $ Work-in-process Finished goods Total inventory $ $
Schedule of property, plant and equipment	June 30, 2015 December 31, 2014 (in thousands) Land $ $ Building and improvements Machinery and equipment Leasehold improvements Gross property, plant and equipment Less: accumulated depreciation and amortization Net property, plant, and equipment $ $
Schedule of changes in goodwill	Gross carrying Accumulated amount impairment Net amount (in thousands) Goodwill - December 31, 2014 $ $ $ Purchase price allocation adjustment — Goodwill - June 30, 2015 $ $ $
Schedule of intangible assets excluding goodwill	June 30, 2015 December 31, 2014 Accumulated Accumulated Gross Amortization Gross Amortization Carrying and Net Carrying and Net Amount Impairment Amount Amount Impairment Amount (in thousands) Technology $ $ $ $ $ $ Customer relationships Trademarks and tradenames Indefinite-lived trademark — — Other Total $ $ $ $ $ $

Liabilities (Tables)

Liabilities (Tables)	6 Months Ended
	Jun. 30, 2015
Liabilities
Schedule of accrued expenses and other current liabilities	June 30, 2015 December 31, 2014 (in thousands) Payroll and related benefits $ $ Warranty Installation Sales, use, and other taxes Professional fees Restructuring liability Other Total accrued liabilities $ $
Schedule of changes in product warranty reserves	(in thousands) Warranty reserves - December 31, 2014 $ Warranties issued Settlements made ) Changes in estimate ) Warranty reserves - June 30, 2015 $
Schedule of restructuring accrual activities	Personnel Severance and Facility Related Costs Closing Costs Total (in thousands) Restructuring accrual - December 31, 2014 $ $ — $ Provision Payments ) ) ) Restructuring accrual - June 30, 2015 $ $ $

Equity (Tables)

Equity (Tables)	6 Months Ended
	Jun. 30, 2015
Equity
Schedule of the components of accumulated other comprehensive income	Currency translation gain (loss) Minimum Pension Liability Unrealized Gains on Available-for-sale Securities Total (in thousands) Balance at December 31, 2014 $ $ ) $ $ Other comprehensive income (loss) before reclassifications ) — ) Amounts reclassified from AOCI — — ) ) Other comprehensive income (loss) ) — ) Balance at June 30, 2015 $ $ ) $ $

Share-based compensation (Table

Share-based compensation (Tables)	6 Months Ended
	Jun. 30, 2015
Share-based compensation
Schedule of share-based compensation expense	Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands) Cost of sales $ $ $ $ Selling, general, and administrative Research and development Total share-based compensation expense $ $ $ $
Summary of restricted share activity	Weighted Average Grant Date Number of Shares Fair Value (in thousands) Restricted shares outstanding - December 31, 2014 $ Granted Vested ) Forfeited ) Restricted shares outstanding - June 30, 2015 $
Summary of stock option activity	Weighted Average Number of Shares Exercise Price (in thousands) Stock options outstanding - December 31, 2014 $ Granted Exercised ) Expired or forfeited ) Stock options outstanding - June 30, 2015 $

Income Taxes (Tables)

Income Taxes (Tables)	6 Months Ended
	Jun. 30, 2015
Income Taxes
Schedule of income (loss) before income taxes and provision for income taxes	Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands) Income (loss) before income taxes $ ) $ ) $ ) $ Income tax expense (benefit) $ $ ) $ $ )

Segment Reporting and Geograp23

Segment Reporting and Geographic Information (Tables)	6 Months Ended
	Jun. 30, 2015
Segment Reporting and Geographic Information
Schedule of revenue by market	Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands) Lighting, Display & Power Electronics $ $ $ $ Advanced Packaging, MEMS & RF Scientific & Industrial Data Storage Total Sales $ $ $ $
Schedule of revenue by geography	Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 (in thousands) United States $ $ $ $ China EMEA (1) Rest of World Total Sales $ $ $ $ (1) EMEA consists of Europe, the Middle East, and Africa

Basis of Presentation (Details)

Basis of Presentation (Details)	6 Months Ended
	Jun. 30, 2015
Basis of Presentation
Number of weeks in each fiscal quarter for 52-week fiscal year	91 days

Basis of Presentation (Details

Basis of Presentation (Details 2)	6 Months Ended
	Jun. 30, 2015
Revenue Recognition
Revenue retention percentage	10.00%

Income (Loss) Per Common Shar26

Income (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Income (Loss) Per Common Share
Net income (loss)	$ (8,386)	$ (15,211)	$ (27,496)	$ 3,949
Net income (loss) per common share:
Basic (in dollars per share)	$ (0.21)	$ (0.39)	$ (0.69)	$ 0.10
Diluted (in dollars per share)	$ (0.21)	$ (0.39)	$ (0.69)	$ 0.10
Basic weighted average shares outstanding	39,693	39,379	39,666	39,275
Effect of potentially dilutive share-based awards				786
Diluted weighted average shares outstanding	39,693	39,379	39,666	40,061

Income (Loss) Per Common Shar27

Income (Loss) Per Common Share (Details 2) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Diluted income (loss) per share
Shares excluded from the calculation of diluted net income (loss) per share since Veeco incurred a net loss (in shares)	169	321	174
Nonvested Participating Shares
Basic income (loss) per share
Shares excluded from the calculation of basic net income (loss) per share since Veeco incurred a net loss (in shares)	1,100	1,100	1,100
Non-participating Shares
Diluted income (loss) per share
Shares excluded from the calculation of diluted net income (loss) per share (in shares)	1,976	1,045	1,964	921

Assets (Details)

Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Major categories of assets and liabilities measured on a recurring basis, at fair value
Short-term investments	$ 82,397	$ 120,572
Transfer of assets between levels	0
Level 3
Major categories of assets and liabilities measured on a recurring basis, at fair value
Assets measured at fair value	0	0
Liabilities measured at fair value	0	0
Assets and liabilities measured on a recurring basis | Level 1 | U.S. treasuries
Major categories of assets and liabilities measured on a recurring basis, at fair value
Short-term investments	59,740	81,527
Assets and liabilities measured on a recurring basis | Level 2 | Government agency securities
Major categories of assets and liabilities measured on a recurring basis, at fair value
Short-term investments	5,000
Assets and liabilities measured on a recurring basis | Level 2 | Corporate debt
Major categories of assets and liabilities measured on a recurring basis, at fair value
Short-term investments	17,657	39,045
Assets and liabilities measured on a recurring basis | Total | U.S. treasuries
Major categories of assets and liabilities measured on a recurring basis, at fair value
Short-term investments	59,740	81,527
Assets and liabilities measured on a recurring basis | Total | Government agency securities
Major categories of assets and liabilities measured on a recurring basis, at fair value
Short-term investments	5,000
Assets and liabilities measured on a recurring basis | Total | Corporate debt
Major categories of assets and liabilities measured on a recurring basis, at fair value
Short-term investments	$ 17,657	$ 39,045

Assets (Details 2)

Assets (Details 2) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Total available-for-sale securities
Amortized Cost	$ 82,337	$ 120,537
Gross Unrealized Gains	61	47
Gross Unrealized Losses	(1)	(12)
Estimated Fair Value	82,397	120,572
Available-for-sale securities in a loss position
Estimated Fair value	2,139	48,070
Gross Unrealized Losses	(1)	(12)
Investments that had been in a continuous loss position for more than 12 months	0	0
Amortized costs of contractual maturities of available-for-sale securities
Due in one year or less	44,647
Due after one year through two years	37,690
Estimated fair value of contractual maturities of available-for-sale securities
Due in one year or less	44,668
Due in 1-2 years	37,729
U.S. treasuries
Total available-for-sale securities
Amortized Cost	59,693	81,506
Gross Unrealized Gains	47	27
Gross Unrealized Losses		(6)
Estimated Fair Value	59,740	81,527
Available-for-sale securities in a loss position
Estimated Fair value		35,001
Gross Unrealized Losses		(6)
Government agency securities
Total available-for-sale securities
Amortized Cost	5,000
Estimated Fair Value	5,000
Corporate debt
Total available-for-sale securities
Amortized Cost	17,644	39,031
Gross Unrealized Gains	14	20
Gross Unrealized Losses	(1)	(6)
Estimated Fair Value	17,657	39,045
Available-for-sale securities in a loss position
Estimated Fair value	2,139	13,069
Gross Unrealized Losses	$ (1)	$ (6)

Assets (Details 3)

Assets (Details 3) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Accounts Receivable, Net
Allowance for doubtful accounts receivable (in dollars)	$ 500	$ 700
Prepaid expenses and other current assets
Supplier deposits	15,200	12,700
Inventories
Materials	33,378	28,637
Work in process	25,091	26,778
Finished goods	5,095	6,056
Inventories	$ 63,564	$ 61,471

Assets (Details 4)

Assets (Details 4) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014	Dec. 04, 2014
Property, plant and equipment, net
Gross property, plant, and equipment	$ 176,061		$ 176,061		$ 170,542
Less accumulated depreciation and amortization	96,059		96,059		91,790
Net property, plant and equipment	80,002		80,002		78,752
Depreciation	3,000	$ 2,900	5,800	$ 5,800
Goodwill
Impairment of goodwill			0
Goodwill acquired			0
Gross carrying Amount, beginning balance			238,158
Accumulated Impairment, beginning balance			123,199
Net Amount, beginning balance			114,959
Purchase price adjustment			297
Gross carrying Amount, ending balance	238,455		238,455
Accumulated Impairment, ending balance	123,199		123,199
Net Amount, ending balance	115,256		115,256
Intangible assets
Impairment of intangible assets			0
Intangible assets acquired			0
Accumulated Amortization and Impairment	139,146		139,146		123,205
Total Gross Intangible Assets	282,513		282,513		282,513
Total Net Intangible Assets	143,367		143,367		159,308
Indefinite-lived trademark
Intangible assets
Indefinite-lived intangible assets	2,900		2,900		2,900
Technology
Intangible assets
Gross Carrying Amount	222,358		222,358		222,358
Accumulated Amortization and Impairment	113,419		113,419		106,342
Net Amount	108,939		108,939		116,016
Customer relationships
Intangible assets
Gross Carrying Amount	47,885		47,885		47,885
Accumulated Amortization and Impairment	18,685		18,685		14,918
Net Amount	29,200		29,200		32,967
Trademarks and tradenames
Intangible assets
Gross Carrying Amount	3,050		3,050		3,050
Accumulated Amortization and Impairment	1,717		1,717		1,096
Net Amount	1,333		1,333		1,954
Other
Intangible assets
Gross Carrying Amount	6,320		6,320		6,320
Accumulated Amortization and Impairment	5,325		5,325		849
Net Amount	995		995		5,471
Tools
Property, plant and equipment, net
Assets held for sale	1,000		1,000		1,300
Land
Property, plant and equipment, net
Gross property, plant, and equipment	9,392		9,392		9,392
Building and improvements
Property, plant and equipment, net
Gross property, plant, and equipment	54,118		54,118		51,979
Machinery and equipment
Property, plant and equipment, net
Gross property, plant, and equipment	107,153		107,153		104,815
Leaseholds improvements
Property, plant and equipment, net
Gross property, plant, and equipment	$ 5,398		$ 5,398		$ 4,356
PSP
Goodwill
Net assets acquired						$ 145,500

Assets (Details 5)

Assets (Details 5) - USD ($) $ in Millions	3 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Cost Method Investment
Additional investment	$ 0.8
Carrying value of the investment	$ 20.2	$ 19.4
Maximum
Cost Method Investment
Percentage ownership of cost method investee	20.00%

Liabilities (Details)

Liabilities (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Accrued Expenses and Other Current Liabilities
Payroll and related benefits	$ 21,634	$ 28,938
Warranty	5,593	5,411
Installation	2,912	2,861
Sales, use, and other taxes	2,568	1,776
Professional fees	1,989	2,752
Restructuring liability	822	1,428
Other	3,825	5,252
Total accrued liabilities	39,343	$ 48,418
Accrued Warranty
Balance as of the beginning of period	5,411
Warranties issued	3,085
Settlements made	(1,932)
Changes in estimate	(971)
Balance as of the end of period	$ 5,593
Warranty period of products purchased	1 year

Liabilities (Details 2)

Liabilities (Details 2) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Reconciliation of the restructuring liability
Balance at the beginning of the period			$ 1,428
Provision	$ 683	$ 801	3,040	$ 1,193
Payments			(3,646)
Balance at the end of the period	822		822
Customer Deposits and Deferred Revenue
Customer deposits	57,000		57,000		$ 73,000
Personnel severance and related costs
Reconciliation of the restructuring liability
Balance at the beginning of the period			1,428
Provision			2,085
Payments			(2,930)
Balance at the end of the period	583		583
Facility Closing Costs
Reconciliation of the restructuring liability
Provision			955
Payments			(716)
Balance at the end of the period	$ 239		$ 239

Liabilities (Details 3)

Liabilities (Details 3) - Mortgage Payable - USD ($) $ in Millions	Jun. 30, 2015	Dec. 31, 2014
Debt
Mortgage payable outstanding	$ 1.7	$ 1.8
Annual interest rate accrued on mortgage (as a percent)	7.91%
Level 3
Debt
Fair value of debt instrument	$ 1.8	$ 2

Commitments and Contingencies (

Commitments and Contingencies (Details) $ in Millions	Jun. 30, 2015USD ($)
Purchase Commitments
Purchase commitments due within one year	$ 123.4
Bank guarantees and lines of credit
Bank guarantees outstanding	36.2
Unused letters of credit	$ 30.9

Equity (Details)

Equity (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Changes in the balances of each component of AOCI
Beginning Balance			$ 1,469
Other comprehensive income (loss) before reclassifications			(4)
Amounts reclassified from AOCI			(1)
Other comprehensive income (loss)	$ (23)	$ 2	(5)	$ 185
Ending Balance	1,464		1,464
Currency translation gain (loss)
Changes in the balances of each component of AOCI
Beginning Balance			2,333
Other comprehensive income (loss) before reclassifications			(30)
Other comprehensive income (loss)			(30)
Ending Balance	2,303		2,303
Minimum pension liability
Changes in the balances of each component of AOCI
Beginning Balance			(881)
Ending Balance	(881)		(881)
Unrealized gain on available for sale securities
Changes in the balances of each component of AOCI
Beginning Balance			17
Other comprehensive income (loss) before reclassifications			26
Amounts reclassified from AOCI			(1)
Other comprehensive income (loss)			25
Ending Balance	$ 42		$ 42

Share-based compensation (Detai

Share-based compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Weighted Average Grant Date Fair Value
Total share-based compensation expense	$ 4,921	$ 5,091	$ 8,919	$ 9,813
Cost of Sales
Weighted Average Grant Date Fair Value
Total share-based compensation expense	713	620	1,314	1,180
Selling, General and Administrative Expenses
Weighted Average Grant Date Fair Value
Total share-based compensation expense	3,112	3,324	5,910	6,425
Research and Development Expense.
Weighted Average Grant Date Fair Value
Total share-based compensation expense	$ 1,096	$ 1,147	$ 1,695	$ 2,208
Restricted Stock Awards
Restricted stock awards including restricted stock units, Shares
Outstanding at the beginning of the period (in shares)			1,237
Granted (in shares)			597
Vested (in shares)			(125)
Forfeited (in shares)			(59)
Outstanding at the end of the period (in shares)	1,650		1,650
Weighted Average Grant Date Fair Value
Outstanding at the beginning of the period (in dollars per share)			$ 34.27
Grants (in dollars per share)			31.32
Vested/released (in dollars per share)			40.70
Forfeitures (in dollars per share)			35.92
Outstanding at the end of the period (in dollars per share)	$ 32.66		$ 32.66
Restricted Stock Awards | Minimum
Weighted Average Grant Date Fair Value
Expiration term			1 year
Restricted Stock Awards | Maximum
Weighted Average Grant Date Fair Value
Expiration term			5 years
Stock options
Stock option awards, Shares
Outstanding at the beginning of the period (in shares)			2,391
Granted (in shares)			17
Exercised (in shares)			(74)
Expired or forfeited (in shares)			(119)
Outstanding at the end of the period (in shares)	2,215		2,215
Weighted Average Exercise price
Outstanding at the beginning of the period (in dollars per share)			$ 31.65
Grants (in dollars per share)			30.22
Exercised (in dollars per share)			19.07
Expired or forfeited (in dollars per share)			38.62
Outstanding at the end of the period (in dollars per share)	$ 31.69		$ 31.69

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Income (loss) before income taxes	$ (3,907)	$ (15,699)	$ (19,570)	$ 3,092
Income tax expense (benefit)	4,479	$ (488)	7,926	$ (857)
Domestic
Income tax expense (benefit)	3,300		5,300
Foreign
Income tax expense (benefit)	$ 1,200		$ 2,600

Segment Reporting and Geograp40

Segment Reporting and Geographic Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015USD ($)	Jun. 30, 2014USD ($)	Jun. 30, 2015USD ($)itemsegment	Jun. 30, 2014USD ($)
Segment Reporting and Geographic Information
Number of operating segments | segment			1
Number of reportable segments | segment			1
Number of primary sales markets | item			4
Revenue reporting by market and geographic location
Total Sales	$ 131,410	$ 95,122	$ 229,751	$ 185,963
United States
Revenue reporting by market and geographic location
Total Sales	19,632	13,466	47,601	20,943
China
Revenue reporting by market and geographic location
Total Sales	66,437	51,088	110,718	83,926
EMEA
Revenue reporting by market and geographic location
Total Sales	21,990	6,908	30,314	17,254
Rest of World
Revenue reporting by market and geographic location
Total Sales	23,351	23,660	41,118	63,840
Lighting, Display & Power Electronics
Revenue reporting by market and geographic location
Total Sales	82,122	66,221	146,450	130,112
Advanced Packaging, MEMS & RF
Revenue reporting by market and geographic location
Total Sales	13,840	1,836	27,005	2,635
Scientific & Industrial
Revenue reporting by market and geographic location
Total Sales	17,960	14,082	31,595	22,567
Data Storage
Revenue reporting by market and geographic location
Total Sales	$ 17,488	$ 12,983	$ 24,701	$ 30,649