Veeco Instruments (VECO) 10-Q 1 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Oct. 24, 2018
Document and Entity Information
Entity Registrant Name	VEECO INSTRUMENTS INC
Entity Central Index Key	103,145
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
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		47,793,001
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q3

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 213,506	$ 279,736
Restricted cash	828	847
Short-term investments	52,063	47,780
Accounts receivable, net	90,816	98,866
Contract assets	7,441	160
Inventories	149,832	120,266
Deferred cost of sales	2,986	15,994
Prepaid expenses and other current assets	23,400	33,437
Total current assets	540,872	597,086
Property, plant, and equipment, net	80,626	85,058
Intangible assets, net	89,398	369,843
Goodwill	307,131	307,131
Deferred income taxes	2,183	3,047
Other assets	30,356	25,310
Total assets	1,050,566	1,387,475
Current liabilities:
Accounts payable	65,042	50,318
Accrued expenses and other current liabilities	40,430	58,068
Customer deposits and deferred revenue	64,443	112,032
Income taxes payable	1,819	3,846
Total current liabilities	171,734	224,264
Deferred income taxes	7,170	36,845
Long-term debt	284,369	275,630
Other liabilities	9,206	10,643
Total liabilities	472,479	547,382
Stockholders' equity:
Preferred stock, $0.01 par value; 500,000 shares authorized; no shares issued and outstanding.
Common stock, $0.01 par value; 120,000,000 shares authorized; 48,633,204 and 48,229,251 shares issued at September 30, 2018 and December 31, 2017, respectively; 47,793,001 and 48,144,416 shares outstanding at September 30, 2018 and December 31, 2017, respectively.	486	482
Additional paid-in capital	1,060,733	1,051,953
Accumulated deficit	(475,284)	(212,870)
Accumulated other comprehensive income	1,812	1,812
Treasury stock, at cost, 840,203 and 84,835 shares at September 30, 2018 and December 31, 2017, respectively.	(9,660)	(1,284)
Total stockholders' equity	578,087	840,093
Total liabilities and stockholders' equity	$ 1,050,566	$ 1,387,475

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Consolidated Balance Sheets
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
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	48,633,204	48,229,251
Common stock, shares outstanding	47,793,001	48,144,416
Treasury stock, shares	840,203	84,835

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Consolidated Statements of Operations
Net sales	$ 126,757	$ 129,308	$ 443,110	$ 336,025
Cost of sales	80,372	78,779	284,651	215,150
Gross profit	46,385	50,529	158,459	120,875
Operating expenses, net:
Research and development	23,544	24,061	72,793	57,669
Selling, general, and administrative	20,186	29,771	70,842	71,574
Amortization of intangible assets	4,183	12,500	28,102	21,722
Restructuring	2,057	5,010	7,669	9,605
Acquisition costs	249	783	2,906	16,277
Asset impairment		2	252,343	1,139
Other, net	39	(140)	325	(228)
Total operating expenses, net	50,258	71,987	434,980	177,758
Operating income (loss)	(3,873)	(21,458)	(276,521)	(56,883)
Interest income	823	357	2,266	1,932
Interest expense	(5,602)	(5,105)	(16,113)	(14,301)
Income (loss) before income taxes	(8,652)	(26,206)	(290,368)	(69,252)
Income tax expense (benefit)	301	(2,466)	(27,954)	(26,334)
Net income (loss)	$ (8,953)	$ (23,740)	$ (262,414)	$ (42,918)
Income (loss) per common share:
Basic (in dollars per share)	$ (0.19)	$ (0.51)	$ (5.55)	$ (1)
Diluted (in dollars per share)	$ (0.19)	$ (0.51)	$ (5.55)	$ (1)
Weighted average number of shares:
Basic (in shares)	46,982	46,941	47,283	43,100
Diluted (in shares)	46,982	46,941	47,283	43,100

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Consolidated Statements of Comprehensive Income (Loss)
Net income (loss)	$ (8,953)	$ (23,740)	$ (262,414)	$ (42,918)
Other comprehensive income (loss), net of tax:
Unrealized gain (loss) on available-for-sale securities	4	70	4	10
Foreign currency translation	(4)	1	(4)	25
Total other comprehensive income (loss), net of tax		71		35
Total comprehensive income (loss)	$ (8,953)	$ (23,669)	$ (262,414)	$ (42,883)

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash Flows from Operating Activities
Net income (loss)	$ (262,414)	$ (42,918)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	41,110	32,295
Non-cash interest expense	8,739	7,641
Deferred income taxes	(28,872)	(22,600)
Share-based compensation expense	12,720	19,976
Asset impairment	252,343	1,139
Provision for bad debts		99
Changes in operating assets and liabilities:
Accounts receivable and contract assets	769	(6,360)
Inventories and deferred cost of sales	(17,748)	9,328
Prepaid expenses and other current assets	10,037	(331)
Accounts payable and accrued expenses	(4,006)	3,129
Customer deposits and deferred revenue	(47,589)	19,030
Income taxes receivable and payable, net	(3,552)	(16)
Long-term income tax liability		(4,877)
Other, net	(915)	(259)
Net cash provided by (used in) operating activities	(39,378)	15,276
Cash Flows from Investing Activities
Acquisitions of businesses, net of cash acquired	(2,662)	(399,478)
Capital expenditures	(5,788)	(17,403)
Proceeds from the sale of investments	65,365	307,757
Payments for purchases of investments	(72,303)	(279,945)
Proceeds from held for sale assets		2,284
Net cash provided by (used in) investing activities	(15,388)	(386,785)
Cash Flows from Financing Activities
Proceeds (net of tax withholdings) from option exercises and employee stock purchase plan	3,007	2,546
Restricted stock tax withholdings	(3,029)	(7,797)
Proceeds from long-term debt borrowings		335,752
Purchases of common stock	(11,457)
Principal payments on long-term debt		(1,193)
Net cash provided by (used in) financing activities	(11,479)	329,308
Effect of exchange rate changes on cash and cash equivalents	(4)	25
Net increase (decrease) in cash, cash equivalents, and restricted cash	(66,249)	(42,176)
Cash, cash equivalents, and restricted cash - beginning of period	280,583	277,444
Cash, cash equivalents, and restricted cash - end of period	214,334	235,268
Supplemental Disclosure of Cash Flow Information
Interest paid	9,655	4,667
Income taxes paid	4,269	1,767
Non-cash operating and financing activities
Net transfer of inventory to property, plant and equipment	$ 1,170	$ 33

Basis of Presentation

Basis of Presentation	9 Months Ended
	Sep. 30, 2018
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 Veeco’s 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, 2017 (“2017 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. 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 2018 interim quarters end on April 1, July 1, and September 30, and the 2017 interim quarters ended on April 2, July 2, and October 1. These interim quarters are reported as March 31, June 30, and September 30 in Veeco’s interim consolidated financial statements. Change in Accounting Policy The Company adopted ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), as of January 1, 2018, using the full retrospective method. All amounts and disclosures set forth in this Form 10-Q reflect these changes. The most significant financial statement impacts of adopting ASC 606 are the elimination of the constraint on revenue associated with the billing retention related to the receipt of customer final acceptance and the identification of installation services as a performance obligation. The elimination of the constraint on revenue related to customer final acceptance, which is usually about 10 percent of a system sale, is now generally recognized at the time the Company transfers control of the system to the customer, which is earlier than under the Company’s previous revenue recognition model for certain contracts that were subject to the billing constraint. The new performance obligation related to installation services is now recognized as the installation services are performed, which is later than the Company’s previous revenue recognition model. The Company applied ASC 606 retrospectively and elected to use the disclosure exemption in the transition guidance under which the Company does not disclose prior period information regarding the amount of the transaction price allocated to remaining performance obligations. The cumulative effect of the adoption was recognized as a decrease to Accumulated deficit of $6.9 million on January 1, 2016. The following tables summarize the impact of adoption on the Company’s previously reported financial position and results: December 31, 2017 As reported Adjustments As adjusted (in thousands) Balance Sheet Contract assets $ — $ 160 $ 160 Deferred cost of sales 16,060 (66) 15,994 Deferred income taxes 2,953 94 3,047 Accrued expenses and other current liabilities 60,339 (2,271) 58,068 Customer deposits and deferred revenue 108,953 3,079 112,032 Additional paid-in capital 1,053,079 (1,126) 1,051,953 Accumulated deficit (213,376) 506 (212,870) Three months ended September 30, 2017 Nine months ended September 30, 2017 As reported Adjustments As adjusted As reported Adjustments As adjusted (in thousands, except per share amounts) Statement of Operations Net sales $ 131,872 $ (2,564) $ 129,308 $ 341,324 $ (5,299) $ 336,025 Cost of sales 78,811 (32) 78,779 215,344 (194) 215,150 Income tax expense (benefit) (1,790) (676) (2,466) (24,969) (1,365) (26,334) Net income (loss) (21,884) (1,856) (23,740) (39,177) (3,741) (42,918) Diluted earnings (loss) per share (0.47) (0.04) (0.51) (0.91) (0.09) (1.00) The Company’s adoption of the standard had no impact to cash provided by or used in operating, investing, or financing activities on the Consolidated Statements of Cash Flows. Revenue Recognition Revenue is recognized upon the transfer of control of the promised product or service to the customer in an amount that reflects the consideration the Company expects to receive in exchange for such product or service. The Company’s contracts with customers generally do not contain variable consideration. In the rare instances where variable consideration is included, the Company estimates the amount of variable consideration and determines what portion of that, if any, has a high probability of significant subsequent revenue reversal, and if so, that amount is excluded from the transaction price. The Company’s contracts with customers frequently contain multiple deliverables, such as systems, upgrades, components, spare parts, installation, maintenance, and service plans. Judgment is required to properly identify the performance obligations within a contract and to determine how the revenue should be allocated among the performance obligations. The Company also evaluates whether multiple transactions with the same customer or related parties should be considered part of a single contract 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. When there are separate units of accounting, the Company allocates revenue to each performance obligation on a relative stand-alone selling price basis. The stand-alone selling prices are determined based on the prices at which the Company separately sells the systems, upgrades, components, spare parts, installation, maintenance, and service plans. For items that are not sold separately, the Company estimates stand-alone selling prices generally using an expected cost plus margin approach. Most of the Company’s revenue is recognized at a point in time when the performance obligation is satisfied. The Company considers many facts when evaluating each of its sales arrangements to determine the timing of revenue recognition, including its contractual obligations and the nature of the customer’s post-delivery acceptance provisions. The Company’s system sales arrangements, including certain upgrades, generally include field acceptance provisions that may include functional or mechanical test procedures. For many of these arrangements, a customer source inspection of the system is performed in the Company’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 the Company objectively demonstrates that the criteria specified in the contractual acceptance provisions are achieved prior to delivery, transfer of control of the product to the customer is considered to have occurred and revenue is recognized upon system delivery since there is no substantive contingency remaining related to the acceptance provisions at that date. For new products, new applications of existing products, or for products with substantive customer acceptance provisions where the Company cannot objectively demonstrate that the criteria specified in the contractual acceptance provisions have been achieved prior to delivery, revenue and the associated costs are deferred. The Company recognizes such revenue and costs upon obtaining objective evidence that the acceptance provisions can be achieved, assuming all other revenue recognition criteria have been met. In certain cases the Company’s contracts with customers contain a billing retention, typically 10% of the sales price, which is billed by the Company and payable by the customer when field acceptance provisions are completed. Revenue recognized in advance of the amount that has been billed is recorded as a contract asset on the Consolidated Balance Sheets. The Company recognizes revenue related to maintenance and service contracts over time based upon the respective contract term. Installation revenue is recognized over time as the installation services are performed. The Company recognizes revenue from the sales of components, spare parts, and specified service engagements at a point in time, which is typically consistent with the time of delivery in accordance with the terms of the applicable sales arrangement. The Company may receive customer deposits on system transactions. The timing of the transfer of goods or services related to the deposits is either at the discretion of the customer or expected to be within one year from the deposit receipt. As such, the Company does not adjust transaction prices for the time value of money. Incremental direct costs incurred related to the acquisition of a customer contract, such as sales commissions, are expensed as incurred since the expected amortization period is one year or less. The Company has elected to treat shipping and handling costs as a fulfillment activity, and such costs are included in cost of services when the Company recognizes revenue for the related goods. Taxes assessed by governmental authorities that are collected by the Company from a customer are excluded from revenue. Income Taxes On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (“2017 Tax Act”), which makes broad and complex changes to the U.S. tax code. Certain income tax effects of the 2017 Tax Act are reflected in the Company’s financial results in accordance with Staff Accounting Bulletin No. 118 (“SAB 118”), which provides SEC staff guidance regarding the application of ASC Topic 740, Income Taxes (“ASC 740”). Refer to Note 10, “Income Taxes,” for further information on the financial statement impact of the 2017 Tax Act. Because of the complexity of the new global intangible low-taxed income (“GILTI”) rule, the Company is continuing to evaluate this provision of the 2017 Tax Act and the application of ASC 740. Under U.S. GAAP, the Company is allowed to make an accounting policy choice of either (1) treating taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (“period cost method”) or (2) factoring such amounts into a company’s measurement of its deferred taxes (“deferred method”). The Company’s selection of an accounting policy with respect to the new GILTI tax rules will depend, in part, on analyzing its global income to determine whether it expects to have future U.S. inclusions in taxable income related to GILTI, and if so, what the impact will be. This assessment depends not only on the Company’s current structure and estimated future results of global operations, but also on its intent and ability to modify its structure and/or business. The Company is not yet able to reasonably estimate the effect of this provision of the 2017 Tax Act; therefore, the Company has not made any deferred tax adjustments related to potential GILTI tax in its consolidated financial statements and has not made a policy election decision regarding whether to record deferred taxes on GILTI. Recent Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02: Leases , which generally requires operating lessee rights and obligations to be recognized as assets and liabilities on the balance sheet. In addition, in July 2018, the FASB issued ASU 2018-11: Leases, Targeted Improvements , which adds a transition option whereby companies can recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption rather than in the earliest period presented. The Company plans to adopt using this transition option. These ASUs are effective for fiscal years beginning after December 15, 2018. The Company is evaluating the impact of adopting these ASUs on the consolidated financial statements. The Company 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 the Company’s consolidated financial statements. Recently Adopted Accounting Pronouncements The Company adopted ASU 2016-01, Financial Instruments – Overall , as of January 1, 2018. This ASU requires certain equity investments to be measured at fair value, with changes in fair value recognized in net income. The Company measures equity investments without readily observable market prices at cost, adjusted for changes in observable prices minus impairment. Changes in measurement are included in “Other, net” in the Consolidated Statements of Operations. This ASU has not had a material impact on the consolidated financial statements upon adoption, and the Company will monitor its equity investments each reporting period for changes in observable market prices, if any, which may be material in future periods. The Company adopted ASU 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory , as of January 1, 2018. This ASU requires the Company to recognize the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. This ASU has not had a material impact on the consolidated financial statements. The Company adopted ASU 2016-18, Statement of Cash Flows: Restricted Cash , as of January 1, 2018. This ASU requires the Company to include restricted cash with cash and cash equivalents when reconciling the beginning and end of period total amounts shown on the Statement of Cash Flows. This ASU has not had a material impact on the consolidated financial statements.

Income (Loss) Per Common Share

Income (Loss) Per Common Share	9 Months Ended
	Sep. 30, 2018
Income (Loss) Per Common Share
Income (Loss) Per Common Share	Note 2 — Income (Loss) Per Common Share The Company considers unvested share-based awards that have non-forfeitable rights to dividends prior to vesting to be participating shares, which are treated as a separate class of security from the Company’s common shares for calculating per share data. Therefore, the Company applies the two-class method when calculating income (loss) per share. The two-class method is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. However, since the holders of the participating shares are not obligated to fund losses, participating shares are excluded from the calculation of loss per share. The dilutive effect of the Convertible Senior Notes on income (loss) per share is calculated using the treasury stock method since the Company has both the current intent and ability to settle the principal amount of the Convertible Senior Notes in cash. See Note 5, “Liabilities,” for additional information on the Convertible Senior Notes. Basic income (loss) per share is calculated by dividing net income (loss) by the weighted average number of shares outstanding during the period under the two-class method. Diluted income per share is calculated by dividing net income by the weighted average number of shares used to calculate basic income (loss) per share plus the weighted average number of common share equivalents outstanding during the period. The dilutive effect of outstanding options to purchase common stock and non-participating share-based awards is considered in diluted income per share by application of the treasury stock method. The dilutive effect of performance share units is included in diluted income per common share in the periods the performance targets have been achieved. The computations of basic and diluted income (loss) per share for the three and nine months ended September 30, 2018 and 2017 are as follows: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands, except per share amounts) Net income (loss) $ (8,953) $ (23,740) $ (262,414) $ (42,918) Net income (loss) per common share: Basic $ (0.19) $ (0.51) $ (5.55) $ (1.00) Diluted $ (0.19) $ (0.51) $ (5.55) $ (1.00) Basic weighted average shares outstanding 46,982 46,941 47,283 43,100 Effect of potentially dilutive share-based awards — — — — Diluted weighted average shares outstanding 46,982 46,941 47,283 43,100 Unvested participating shares excluded from basic weighted average shares outstanding since the securityholders are not obligated to fund losses 2 166 2 166 Common share equivalents excluded from the diluted weighted average shares outstanding since Veeco incurred a net loss and their effect would be antidilutive 16 220 17 275 Potentially dilutive non-participating shares excluded from the diluted calculation as their effect would be antidilutive 2,617 1,956 2,469 1,628 Maximum potential shares to be issued for settlement of Convertible Senior Notes excluded from the diluted calculation as their effect would be antidilutive 8,618 8,618 8,618 8,618

Business Combinations

Business Combinations	9 Months Ended
	Sep. 30, 2018
Business Combinations
Business Combinations	Note 3 — Business Combinations Ultratech On May 26, 2017, the Company completed its acquisition of Ultratech, Inc. (“Ultratech”). Ultratech develops, manufactures, sells, and supports lithography, laser annealing, and inspection equipment for manufacturers of semiconductor devices, including front-end semiconductor manufacturing and advanced packaging. Ultratech also develops, manufactures, sells, and supports ALD equipment for scientific and industrial applications. Ultratech’s customers are primarily located throughout the United States, Europe, China, Japan, Taiwan, Singapore, and Korea. The results of Ultratech’s operations have been included in the consolidated financial statements since the date of acquisition. Ultratech shareholders received (i) $21.75 per share in cash and (ii) 0.2675 of a share of Veeco common stock for each Ultratech common share outstanding on the acquisition date. Approximately $2.7 million of the cash merger consideration is included in “Accrued expenses and other current liabilities” on the Consolidated Balance Sheets as of December 31, 2017, related to shareholder appraisal proceedings that were subsequently settled and paid during the third quarter of 2018. The following table presents unaudited pro forma financial information as if the acquisition of Ultratech had occurred on January 1, 2016: Three months ended September 30, Nine months ended September 30, 2017 2017 (in thousands, except per share amounts) Net sales $ 129,308 $ 406,767 Loss before income taxes (24,847) (72,091) Diluted earnings per share $ (0.49) $ (1.23) The pro-forma results were calculated by combining the unaudited results of the Company with the stand-alone unaudited results of Ultratech for the pre-acquisition period, and adjusting for the following: (i) Additional amortization expense related to identified intangible assets valued as part of the purchase price allocation that would have been incurred starting on January 1, 2016. (ii) Additional depreciation expense for the property, plant, and equipment fair value adjustments that would have been incurred starting on January 1, 2016. (iii) All acquisition related costs incurred by the Company as well as by Ultratech pre-acquisition have been removed from the year ended December 31, 2017 and included in the year ended December 31, 2016, as such expenses would have been incurred in the first quarter following the acquisition. (iv) All amortization of inventory step-up has been removed from the year ended December 31, 2017 and recorded in the year ended December 31, 2016, as such costs would have been incurred as the corresponding inventory was sold. (v) Additional interest expense related to the Convertible Senior Notes (see Note 5, “Liabilities”) as if the Notes had been issued on January 1, 2016. (vi) Income tax expense (benefit) was adjusted for the impact of the above adjustments for each period. (vii) All shares issued in connection with the acquisition were considered outstanding as of January 1, 2016 for purposes of calculating diluted earnings per share. During the second quarter of 2018, the Company lowered its projected results for the Ultratech asset group and determined that the revised projections were significantly lower than projected results at the time of the acquisition and that these revised projections required the Company to assess the Ultratech asset group for impairment. See Note 4, “Assets” - Intangible Assets , for additional information.

Assets

Assets	9 Months Ended
	Sep. 30, 2018
Assets
Assets	Note 4 — Assets Investments Short-term investments 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” in the Consolidated Balance Sheets. 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. A financial instrument’s level 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. The use of different market assumptions or estimation methodologies could have a significant effect on the estimated fair value amounts. The following table presents the portion of Veeco’s assets that were measured at fair value on a recurring basis at September 30, 2018 and December 31, 2017: Level 1 Level 2 Level 3 Total (in thousands) September 30, 2018 Short-term investments U.S. treasuries $ 36,527 $ — $ — $ 36,527 Corporate debt — 8,561 — 8,561 Commercial paper — 6,975 — 6,975 Total $ 36,527 $ 15,536 $ — $ 52,063 December 31, 2017 Cash equivalents U.S. treasuries $ 12,490 $ — $ — $ 12,490 Total $ 12,490 $ — $ — $ 12,490 Short-term investments U.S. treasuries $ 33,895 $ — $ — $ 33,895 Corporate debt — 10,886 — 10,886 Commercial paper — 2,999 — 2,999 Total $ 33,895 $ 13,885 $ — $ 47,780 There were no transfers between fair value measurement levels during the three and nine months ended September 30, 2018. At September 30, 2018 and December 31, 2017, 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) September 30, 2018 U.S. treasuries $ 36,538 $ 1 $ (12) $ 36,527 Corporate debt 8,573 — (12) 8,561 Commercial paper 6,975 — — 6,975 Total $ 52,086 $ 1 $ (24) $ 52,063 December 31, 2017 U.S. treasuries $ 33,914 $ — $ (19) $ 33,895 Corporate debt 10,894 — (8) 10,886 Commercial paper 2,999 — — 2,999 Total $ 47,807 $ — $ (27) $ 47,780 Available-for-sale securities in a loss position at September 30, 2018 and December 31, 2017 consist of: September 30, 2018 December 31, 2017 Gross Gross Estimated Unrealized Estimated Unrealized Fair Value Losses Fair Value Losses (in thousands) U.S. treasuries $ 29,621 $ (12) $ 33,895 $ (19) Corporate debt 8,561 (12) 10,886 (8) Total $ 38,182 $ (24) $ 44,781 $ (27) At September 30, 2018 and December 31, 2017, there were no short-term investments that had been in a continuous loss position for more than 12 months. The maturities of securities classified as available-for-sale at September 30, 2018 were all due in one year or less. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. There were no realized gains or losses for the three and nine months ended September 30, 2018 and minimal realized gains for the three and nine months ending September 30, 2017. Accounts Receivable Accounts receivable is presented net of an allowance for doubtful accounts of $0.3 million at both September 30, 2018 and December 31, 2017. Inventories Inventories are stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. Inventories at September 30, 2018 and December 31, 2017 consist of the following: September 30, December 31, 2018 2017 (in thousands) Materials $ 84,864 $ 59,919 Work-in-process 41,423 37,222 Finished goods 23,545 23,125 Total $ 149,832 $ 120,266 Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets primarily consist of supplier deposits, prepaid value-added tax, lease deposits, prepaid insurance, and prepaid licenses. Veeco had deposits with its suppliers of $8.9 million and $7.6 million at September 30, 2018 and December 31, 2017, respectively. Property, Plant, and Equipment Property, plant, and equipment at September 30, 2018 and December 31, 2017 consist of the following: September 30, December 31, 2018 2017 (in thousands) Land $ 5,669 $ 5,669 Building and improvements 59,547 54,449 Machinery and equipment (1) 126,126 126,829 Leasehold improvements 8,802 10,073 Gross property, plant, and equipment 200,144 197,020 Less: accumulated depreciation and amortization 119,518 111,962 Net property, plant, and equipment $ 80,626 $ 85,058 (1) Machinery and equipment also includes software, furniture and fixtures For the three and nine months ended September 30, 2018, depreciation expense was $4.6 million and $13.0 million, respectively, and $4.2 million and $10.6 million for the comparable 2017 periods. Goodwill Goodwill represents the future economic benefits arising from assets acquired in a business combination that are not individually identified and separately recognized. The Company is required to assess goodwill annually for impairment, which it does at the beginning of the fourth quarter, or on an interim basis whenever certain events occur or circumstances change, such as an adverse change in business climate, a decline in the adjusted market capitalization of the Company below the book value of the Company’s equity for an extended period of time, or other events that would more likely than not indicate that the fair value of the Company’s single goodwill reporting unit is less than its carrying amount. There were no changes to goodwill during the nine months ended September 30, 2018. As the Company maintains a single goodwill reporting unit, it determines the fair value of its reporting unit based upon the Company’s adjusted market capitalization. The adjusted market capitalization is calculated by multiplying the average closing share price of the Company’s common stock for the last ten trading days prior to the measurement date by the number of outstanding common shares and adding a control premium. Based on the most recent annual impairment test as of October 1, 2018, the Company determined that the fair value of its single goodwill reporting unit exceeded its carrying amount by approximately $60 million. However, this analysis is sensitive to changes in the Company’s stock price and absent other qualitative factors, the Company may be required to record a goodwill impairment charge in future periods if the stock price declines subsequent to its annual measurement date and remains depressed for an extended period of time. Intangible Assets Intangible assets consist of purchased technology, customer relationships, patents, trademarks and tradenames, and backlog, and are initially recorded at fair value. Long-lived intangible assets are amortized over their estimated useful lives in a method reflecting the pattern in which the economic benefits are consumed or amortized on a straight-line basis if such pattern cannot be reliably determined. During the second quarter of 2018, the Company lowered its projected results for the Ultratech asset group, which were significantly below the projected results at the time of the acquisition. The reduced projections were based on lower than expected unit volume of certain smartphones, which incorporate advanced packaging methods such as Fan-Out Wafer Level Packaging (“FOWLP”), and a delay in the adoption of FOWLP advanced packaging by other electronics manufacturers, both of which slowed orders and reduced revenue projections for the Company’s advanced packaging lithography systems. In addition, there has been a delay in the build out of 28nm facilities by companies in China who were expected to purchase the Company’s Laser Spike Anneal (“LSA”) systems. Taken together, the reduced projections identified during the second quarter of 2018 required the Company to assess the Ultratech asset group for impairment. As a result of the analysis, which included projected cash flows that required the use of unobservable inputs, the Company recorded non-cash impairment charges of $216.4 million and $35.9 million related to definite-lived intangible assets and in-process research and development assets, respectively, during the second quarter of 2018. The components of purchased intangible assets were as follows: September 30, 2018 December 31, 2017 Accumulated Accumulated Gross Amortization Gross Amortization Carrying and Net Carrying and Net Amount Impairment Amount Amount Impairment Amount (in thousands) Technology $ 320,888 $ 273,821 $ 47,067 $ 307,588 $ 133,121 $ 174,467 Customer relationships 164,595 134,760 29,835 164,595 39,336 125,259 In-process R&D 30,040 25,000 5,040 43,340 — 43,340 Trademarks and tradenames 30,910 23,560 7,350 30,910 4,321 26,589 Other 3,686 3,580 106 3,686 3,498 188 Total $ 550,119 $ 460,721 $ 89,398 $ 550,119 $ 180,276 $ 369,843 Other intangible assets primarily consist of patents, licenses, and backlog. Based on the revised intangible asset values resulting from the impairment recorded during the period ended June 30, 2018, the remaining estimated annual amortization expense, excluding in-process R&D, is expected to be as follows: Amortization (in thousands) 2018 $ 4,184 2019 16,554 2020 15,628 2021 12,506 2022 10,172 Thereafter 25,314 Total $ 84,358 Other Assets Veeco has an ownership interest of less than 20% in a non-marketable investment, Kateeva, Inc. (“Kateeva”), over which Veeco does not exert significant influence. The carrying value of the investment was $21.0 million at September 30, 2018 and December 31, 2017. Additionally, during the nine months ended September 30, 2018, the Company made a separate non-marketable investment of $3.5 million. The Company does not exert significant influence over this investment, and its ownership interest is less than 20%. Neither equity investment has a readily observable market price, and therefore the Company has elected to measure these investments at cost, adjusted for changes in observable market prices minus impairment. The investments are included in “Other assets” on the Consolidated Balance Sheets. There were no changes in observable market prices for either investment for the nine months ended September 30, 2018. These investments are subject to periodic impairment reviews; as there are no open-market valuations, the impairment analyses require judgment. The analyses include assessments of the companies’ financial condition, the business outlooks for their products and technologies, their 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 relative to other investors.

Liabilities

Liabilities	9 Months Ended
	Sep. 30, 2018
Liabilities
Liabilities	Note 5 — Liabilities Accrued Expenses and Other Current Liabilities The components of accrued expenses and other current liabilities at September 30, 2018 and December 31, 2017 consist of: September 30, December 31, 2018 2017 (in thousands) Payroll and related benefits $ 18,498 $ 32,996 Warranty 7,371 6,532 Interest 1,992 4,430 Professional fees 3,457 3,942 Merger consideration payable — 2,662 Sales, use, and other taxes 532 2,144 Restructuring liability 2,901 1,520 Other 5,679 3,842 Total $ 40,430 $ 58,068 Warranty Warranties are typically valid for one year from the date of system final acceptance, and Veeco estimates the costs that may be incurred under the warranty. Estimated warranty costs are determined by analyzing specific product and historical configuration statistics and regional warranty support costs and are 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 also result in changes to warranty costs. Changes in product warranty reserves for the nine months ended September 30, 2018 include: (in thousands) Balance - December 31, 2017 $ 6,532 Warranties issued 5,249 Consumption of reserves (5,161) Changes in estimate 751 Balance - September 30, 2018 $ 7,371 Restructuring Accruals During 2017, the Company initiated certain restructuring activities related to its efforts to streamline operations, enhance efficiencies, and reduce costs, as well as reduced its investments in certain technology development. In addition, during 2017, the Company began the Ultratech acquisition integration process to enhance efficiencies, resulting in reductions in headcount and other facility costs. During the nine months ended September 30, 2018, additional accruals were recognized and payments were made related to these restructuring initiatives. During the second quarter of 2018, the Company initiated plans to further reduce excess capacity associated with the manufacture and support of the Company's advanced packaging lithography and 3D wafer inspection systems by consolidating these operations into its San Jose, California facility. As a result of this and other cost saving initiatives, the Company announced headcount reductions of approximately 40 employees and recorded restructuring charges related to these actions of $2.4 million for the nine months ended September 30, 2018, consisting principally of personnel severance and related costs. The Company expects the consolidation to be completed in the first quarter of 2019. During the third quarter of 2018, the Company initiated additional restructuring activities to further reduce costs, including headcount reductions impacting approximately 35 employees and recorded restructuring charges related to these actions of $1.1 million, consisting principally of personnel severance and related costs. The Company expects this initiative to be completed by the end of 2018 and to provide approximately $5 million in annualized savings. Over the next few quarters, the Company expects to incur additional restructuring costs of $1 million to $2 million as it completes all of these restructuring initiatives. Personnel Facility Severance and Related Costs Related Costs and Other Total (in thousands) Balance - December 31, 2017 $ 1,520 $ — $ 1,520 Provision 3,930 2,743 6,673 Payments (2,898) (2,394) (5,292) Balance - September 30, 2018 $ 2,552 $ 349 $ 2,901 Included within restructuring expense in the Consolidated Statements of Operations for the nine months ended September 30, 2018 is approximately $1.0 million of non-cash charges related to accelerated share-based compensation for employee terminations. Customer Deposits and Deferred Revenue Customer deposits totaled $20.0 million and $41.5 million at September 30, 2018 and December 31, 2017, respectively. Deferred revenue represents amounts billed, other than deposits, in excess of the revenue that can be recognized on a particular contract at the balance sheet date. Changes in deferred revenue were as follows: (in thousands) Balance - December 31, 2017 $ 70,536 Deferral of revenue 7,166 Recognition of previously deferred revenue (33,224) Balance - September 30, 2018 $ 44,478 As of September 30, 2018, the Company has approximately $63.0 million of remaining performance obligations on contracts with an original estimated duration of one year or more, of which approximately 64% is expected to be recognized within one year, with the remaining amounts expected to be recognized between one to three years. The Company has elected to exclude disclosures regarding remaining performance obligations that have an original expected duration of one year or less. Convertible Senior Notes On January 10, 2017, the Company issued $345.0 million of 2.70% convertible senior unsecured notes (the “Convertible Senior Notes”). The Company received net proceeds, after deducting underwriting discounts and fees and expenses payable by the Company, of approximately $335.8 million. The Convertible Senior Notes bear interest at a rate of 2.70% per year, payable semiannually in arrears on January 15 and July 15 of each year, commencing on July 15, 2017. The Convertible Senior Notes mature on January 15, 2023 (the “Maturity Date”), unless earlier purchased by the Company, redeemed, or converted. The carrying value of the Convertible Senior Notes is as follows: September 30, December 31, 2018 2017 (in thousands) Principal amount $ 345,000 $ 345,000 Unamortized debt discount (55,082) (63,022) Unamortized transaction costs (5,549) (6,348) Net carrying value $ 284,369 $ 275,630 Total interest expense related to the Convertible Senior Notes is as follows: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands) Cash Interest Expense Coupon interest expense $ 2,329 $ 2,329 $ 6,986 $ 6,573 Non-Cash Interest Expense Amortization of debt discount 2,697 2,502 7,940 6,942 Amortization of transaction costs 271 252 799 699 Total Interest Expense $ 5,297 $ 5,083 $ 15,725 $ 14,214 The Company determined the Convertible Senior Notes is a Level 2 liability in the fair value hierarchy and estimated its fair value as $292.0 million at September 30, 2018. Other Liabilities As part of the acquisition of Ultratech, the Company assumed an executive non-qualified deferred compensation plan that allowed qualifying executives to defer cash compensation. The plan was frozen at the time of acquisition and no further contributions have been made. At September 30, 2018 and December 31, 2017, plan assets approximated $3.6 million and $3.4 million, respectively, representing the cash surrender value of life insurance policies and is included within “Other assets” in the Consolidated Balance Sheets, while plan liabilities approximated $3.9 million and $4.7 million, respectively, and is included within “Other liabilities” in the Consolidated Balance Sheets. Other liabilities also include asset retirement obligations of $3.2 million and $3.3 million at September 30, 2018 and December 31, 2017, respectively, and medical and dental benefits of $2.1 million and $2.2 million, respectively.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies
Commitments and Contingencies	Note 6 — Commitments and Contingencies Minimum Lease Commitments At September 30, 2018, the Company’s total future minimum lease payments under non-cancelable operating leases have not changed significantly from the disclosure in the 2017 Form 10-K. Purchase Commitments Veeco has purchase commitments of $114.0 million at September 30, 2018, substantially all of which become due within one year. Bank Guarantees Veeco has bank guarantees and letters of credit issued by a financial institution on its behalf as needed. At September 30, 2018, outstanding bank guarantees and letters of credit totaled $6.9 million, and unused bank guarantees and letters of credit of $64.0 million were available to be drawn upon. Legal Proceedings On June 8, 2018, an Ultratech shareholder who received Veeco stock as part of the consideration for the Ultratech acquisition filed a purported class action complaint in the Superior Court of the State of California, County of Santa Clara, captioned Wolther v. Maheshwari et al., Case No. 18CV329690, on behalf of himself and others who purchased or acquired shares of Veeco pursuant to the registration statement and prospectus which Veeco filed with the SEC in connection with the Ultratech acquisition (the “Wolther Action”). The complaint seeks to recover damages and fees under Sections 11, 12, and 15 of the Securities Act of 1933 for, among other things, alleged false/misleading statements in the registration statement and prospectus relating to the Ultratech acquisition, relating primarily to the alleged failure to disclose delays in the advanced packaging business, increased MOCVD competition in China, and an intellectual property dispute. On August 2 and August 8, 2018, two purported class action complaints substantially similar to the Wolther Action were filed on behalf of different plaintiffs in the same court as the Wolther Action. These three cases are expected to be consolidated. Veeco believes these lawsuits are without merit and intends to vigorously contest these matters. The Company is involved in various other legal proceedings arising in the normal course of business. The Company does not believe that the ultimate resolution of these matters will have a material adverse effect on its consolidated financial position, results of operations, or cash flows. Receivable Purchase Agreement In December 2017, the Company entered into a Receivable Purchase Agreement with a financial institution to sell certain of its trade receivables from customers without recourse, up to $23.0 million at any point in time for a term of one year. There were no sales of accounts receivable under the agreement for the nine months ended September 30, 2018, and as of September 30, 2018, the Company maintained $23.0 million available under the agreement for additional sales of trade receivables.

Derivative Financial Instrument

Derivative Financial Instruments	9 Months Ended
	Sep. 30, 2018
Derivative Financial Instruments
Derivative Financial Instruments	Note 7 — Derivative Financial Instruments The Company is exposed to financial market risks arising from changes in currency exchange rates. Changes in currency exchange rates could affect the Company’s foreign currency denominated monetary assets and liabilities and forecasted cash flows. The Company entered into monthly forward derivative contracts with the intent of mitigating a portion of this risk. The Company only used derivative financial instruments in the context of hedging and not for speculative purposes and had not designated its foreign exchange derivatives as hedges. Accordingly, changes in fair value from these contracts were recorded as “Other, net” in the Company’s Consolidated Statements of Operations. The Company executed derivative transactions with highly rated financial institutions to mitigate counterparty risk. A summary of the foreign exchange derivatives outstanding on September 30, 2018 and December 31, 2017 is as follows: September 30, 2018 December 31, 2017 Fair Value Maturity Dates Notional Amount Fair Value Maturity Dates Notional Amount (in thousands) Foreign currency exchange forwards $ (2) October 2018 $ 4,584 $ — January 2018 $ 622 The following table shows the gains and (losses) from currency exchange derivatives during the three and nine months ended September 30, 2018 and 2017, which are included in “Other, net” in the Consolidated Statements of Operations, as well as the weighted average notional amount of derivatives outstanding for each period: Three months ended September 30, 2018 Three months ended September 30, 2017 Gains (Losses) Weighted average Gains (Losses) Weighted average (in thousands) Foreign currency exchange forwards $ 132 $ 4,448 $ (10) $ 361 Nine months ended September 30, 2018 Nine months ended September 30, 2017 Gains (Losses) Weighted average Gains (Losses) Weighted average (in thousands) Foreign currency exchange forwards $ 348 $ 2,869 $ (9) $ 317

Equity

Equity	9 Months Ended
	Sep. 30, 2018
Equity
Equity	Note 8 — Equity Accumulated Other Comprehensive Income (“AOCI”) The following table presents the changes in the balances of each component of AOCI, net of tax: Unrealized Foreign Gains (Losses) on Currency Available for Sale Translation Securities Total (in thousands) Balance - December 31, 2017 $ 1,839 $ (27) $ 1,812 Other comprehensive income (loss) (4) 4 — Balance - September 30, 2018 $ 1,835 $ (23) $ 1,812 There were minimal reclassifications from AOCI into net income for the nine months ended September 30, 2018.

Share-based compensation

Share-based compensation	9 Months Ended
	Sep. 30, 2018
Share-based compensation
Share-based compensation	Note 9 — 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 may entitle holders to 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 for the three and nine months ended September 30, 2018 and 2017: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands) Cost of sales $ 513 $ 740 $ 1,603 $ 1,898 Research and development 709 849 2,728 1,986 Selling, general, and administrative 1,890 3,714 7,393 10,182 Restructuring 167 867 996 1,707 Acquisition costs — — — 4,203 Total $ 3,279 $ 6,170 $ 12,720 $ 19,976 For the nine months ended September 30, 2018, equity activity related to stock options was as follows: Weighted Number of Average Shares Exercise Price (in thousands) Balance - December 31, 2017 1,394 $ 34.97 Expired or forfeited (147) 36.50 Balance - September 30, 2018 1,247 34.79 For the nine months ended September 30, 2018, equity activity related to non-vested restricted shares and performance shares was as follows: Weighted Average Number of Grant Date Shares Fair Value (in thousands) Balance - December 31, 2017 1,880 $ 25.41 Granted 835 19.31 Performance award adjustments (5) 32.67 Vested (508) 26.44 Forfeited (253) 24.83 Balance - September 30, 2018 1,949 22.59

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2018
Income Taxes
Income Taxes	Note 10 - Income Taxes Income taxes are estimated for each of the jurisdictions in which the Company 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 carryforwards. Realization of net deferred tax assets is dependent on future taxable income. At September 30, 2018, the Company’s U.S. deferred tax assets are fully offset by a valuation allowance since the Company cannot conclude that it is more likely than not that these future benefits will be realized. At the end of each interim reporting period, the effective tax rate is aligned with expectations for the full year. This estimate is used to determine the income tax provision on a year-to-date basis and may change in subsequent interim periods. If necessary, the year-to-date tax benefit for interim period losses is limited to the amount that could be recognizable at the end of the fiscal year. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act. The 2017 Tax Act makes broad and complex changes to the U.S. tax code that affects the Company’s 2018 financial results, including, but not limited to; a reduction in the U.S. federal corporate income tax rate from 35 percent to 21 percent; current U.S. taxation of global intangible low-taxed income (“GILTI”) of non-U.S. operations; additional limitations on the deductibility of executive compensation; and limitations on the deductibility of interest. The Company recognized the income tax effects of the 2017 Tax Act in its 2017 financial statements in accordance with SAB 118, which provides SEC staff guidance for the application of ASC 740 in the reporting period in which the 2017 Tax Act was signed into law. As such, the Company’s 2017 financial results reflect the income tax effects of the 2017 Tax Act, including provisional amounts for specific income tax effects of the 2017 Tax Act for which the accounting under ASC 740 is incomplete but for which a reasonable estimate could be determined. During the second quarter of 2018, the Company recognized an income tax benefit of $1.6 million related to the alternative minimum tax credits that became refundable in accordance with the 2017 Tax Act. The Company is still in the process of evaluating the impacts of the 2017 Tax Act and considers the amounts previously recorded to be provisional, except for the tax benefit of alternative minimum tax credits and the impact of the change in tax rate on the Company’s deferred tax assets and liabilities as of December 31, 2017, for which the accounting is complete. The Company will complete its analysis and finalize the amounts by the end of the fourth quarter of 2018, which is within the measurement period as provided by SAB 118. During the second quarter of 2018, the Company also recognized a tax benefit of $25.3 million primarily due to the intangible asset impairment charge of $252.3 million incurred during the quarter. See Note 4, “Assets” - Intangible Assets , for additional information. Loss before income taxes and income tax benefit for the three and nine months ended September 30, 2018 and 2017 were as follows: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands) Loss before income taxes $ (8,652) $ (26,206) $ (290,368) $ (69,252) Income tax expense (benefit) $ 301 $ (2,466) $ (27,954) $ (26,334) The Company’s tax expense for the three months ended September 30, 2018 was $0.3 million, compared to a tax benefit of $2.5 million for the comparable prior period. The 2018 tax expense is mainly related to the Company’s non-U.S. operations, compared to 2017 when the benefit included a $2.8 million benefit related to domestic operations, offset by a $0.3 million expense related to the Company’s non-U.S. operations. The prior period domestic tax benefit is primarily attributable to an income tax benefit for losses incurred during the three months ended September 30, 2017, as the deferred tax liability created by the issuance of the Convertible Senior Notes is treated as a source of income in fiscal 2017, offset by a deferred provision related to tax amortization on indefinite-lived intangible assets. The prior period non-U.S. tax expense is attributable to the profitable non-U.S. operations. The Company’s tax benefit for the nine months ended September 30, 2018 was $28.0 million, compared to $26.3 million for the comparable prior period. The 2018 tax benefit included a $1.1 million benefit related to the Company’s domestic operations and a $26.9 million benefit related to the Company’s non-U.S. operations, compared to 2017 when the benefit included a $22.7 million benefit related to domestic operations and a $3.6 million benefit related to non-U.S. operations. The current period domestic tax benefit is primarily attributable to refundable alternative minimum tax credits in accordance with 2017 Tax Act, offset by the tax amortization of indefinite-lived intangible assets that is not available to offset U.S. deferred tax assets. The current period foreign tax benefit is primarily attributable to the asset impairment charge incurred during the period. The prior period domestic tax benefit is primarily attributable to an income tax benefit for losses incurred during the nine months ended September 30, 2017, as the deferred tax liability created by the issuance of the Convertible Senior Notes is treated as a source of income in fiscal 2017, offset by a deferred provision related to tax amortization on indefinite-lived intangible assets. The prior period non-U.S. tax benefit is primarily attributable to the remeasurement of an uncertain tax position, which included the reversal of a previously established non-U.S. tax liability and the recognition of a deferred tax benefit related to certain foreign net operating losses generated in prior years that were determined to be realizable, offset by tax expense attributed to the profitable non-U.S. operations.

Segment Reporting and Geographi

Segment Reporting and Geographic Information	9 Months Ended
	Sep. 30, 2018
Segment Reporting and Geographic Information
Segment Reporting and Geographic Information	Note 11 — 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 end-markets: Advanced Packaging, MEMS & RF Filters 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. RF Filters refers to RF filters used in smartphones, tablets, and mobile devices. LED Lighting, Display & Compound Semiconductor LED Lighting refers to Light Emitting Diode (“LED”) and semiconductor illumination sources used in various applications including, but not limited to, displays such as backlights, general lighting, automotive running lights, and headlamps. Display refers to LEDs used for displays and Organic Light Emitting Diode (“OLED”) displays found in outdoor display/signage applications, TVs, smartphones, wearable devices, and tablets. Compound Semiconductor includes Photonics, Power Electronics, and Radio Frequency (“RF”) Devices. Photonics refers to laser diodes, Vertical Cavity Surface Emitting Lasers (“VCSEL”) in 3D sensing and communications, and various other optical devices. Power Electronics refers to semiconductor devices such as rectifiers, inverters, and converters for the control and conversion of electric power. RF devices refers to radio frequency emitting and receiving devices that enable wireless communications. Such devices include power amplifiers, switches, and transceivers for applications such as mobile (including handsets and base stations), defense, automobile, and the Internet of Things. Front-End Semiconductor Front-End Semiconductor refers to the early steps in the process of integrated circuit fabrication where the microchips are created but still remain on the silicon wafer. This category includes Laser Spike Anneal, Ion Beam etch for front-end semiconductor applications, and Ion Beam deposition for EUV mask blanks. Scientific & Industrial Scientific refers to advanced materials research at university research institutions, industry research institutions, industry consortiums, and government research agencies. Industrial refers to large-scale product manufacturing applications including data storage and optical coatings: thin layers of material deposited on a lens or mirror that alters how light reflects and transmits. Sales by end-market and geographic region for the three and nine months ended September 30, 2018 and 2017 were as follows: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands) Sales by end-market Advanced Packaging, MEMS & RF Filters $ 24,562 $ 21,478 $ 76,473 $ 54,216 LED Lighting, Display & Compound Semiconductor 58,864 57,647 236,597 167,105 Front-End Semiconductor 13,476 16,256 41,085 27,736 Scientific & Industrial 29,855 33,927 88,955 86,968 Total $ 126,757 $ 129,308 $ 443,110 $ 336,025 Sales by geographic region United States $ 28,861 $ 34,914 $ 85,555 $ 72,820 China 39,200 12,956 185,050 81,121 EMEA (1) 30,685 16,948 71,836 54,140 Rest of World 28,011 64,490 100,669 127,944 Total $ 126,757 $ 129,308 $ 443,110 $ 336,025 (1) EMEA consists of Europe, the Middle East, and Africa For geographic reporting, sales are attributed to the location in which the customer facility is located.

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2018
Subsequent Events
Subsequent Events	Note 12 — Subsequent Events The Company recently discovered an attack on its computer systems by what appears to be a highly-sophisticated actor. The Company has notified law enforcement of the attack and has retained forensic experts to assist with the investigation. At this time, the Company does not know if or when it will be able to determine the extent of the breach or the potential impact to the Company, whether it will be able to identify who is responsible for this attack or whether it will be able to pursue legal action or other remedies to protect any compromised information or recover damages related to the attack. This attack, including the expenses incurred to address it, may have an adverse effect on the Company’s results of operations and/or financial condition. In addition, this attack could result in the loss or misuse of confidential information of the Company or that of its customers or others, result in litigation and potential liability, damage the Company’s reputation and/or otherwise harm its business.

Basis of Presentation (Policies

Basis of Presentation (Policies)	9 Months Ended
	Sep. 30, 2018
Basis of Presentation
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 Veeco’s 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, 2017 (“2017 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.
Fiscal Period	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 2018 interim quarters end on April 1, July 1, and September 30, and the 2017 interim quarters ended on April 2, July 2, and October 1. These interim quarters are reported as March 31, June 30, and September 30 in Veeco’s interim consolidated financial statements.
Change in Accounting Policy	Change in Accounting Policy The Company adopted ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), as of January 1, 2018, using the full retrospective method. All amounts and disclosures set forth in this Form 10-Q reflect these changes. The most significant financial statement impacts of adopting ASC 606 are the elimination of the constraint on revenue associated with the billing retention related to the receipt of customer final acceptance and the identification of installation services as a performance obligation. The elimination of the constraint on revenue related to customer final acceptance, which is usually about 10 percent of a system sale, is now generally recognized at the time the Company transfers control of the system to the customer, which is earlier than under the Company’s previous revenue recognition model for certain contracts that were subject to the billing constraint. The new performance obligation related to installation services is now recognized as the installation services are performed, which is later than the Company’s previous revenue recognition model. The Company applied ASC 606 retrospectively and elected to use the disclosure exemption in the transition guidance under which the Company does not disclose prior period information regarding the amount of the transaction price allocated to remaining performance obligations. The cumulative effect of the adoption was recognized as a decrease to Accumulated deficit of $6.9 million on January 1, 2016. The following tables summarize the impact of adoption on the Company’s previously reported financial position and results: December 31, 2017 As reported Adjustments As adjusted (in thousands) Balance Sheet Contract assets $ — $ 160 $ 160 Deferred cost of sales 16,060 (66) 15,994 Deferred income taxes 2,953 94 3,047 Accrued expenses and other current liabilities 60,339 (2,271) 58,068 Customer deposits and deferred revenue 108,953 3,079 112,032 Additional paid-in capital 1,053,079 (1,126) 1,051,953 Accumulated deficit (213,376) 506 (212,870) Three months ended September 30, 2017 Nine months ended September 30, 2017 As reported Adjustments As adjusted As reported Adjustments As adjusted (in thousands, except per share amounts) Statement of Operations Net sales $ 131,872 $ (2,564) $ 129,308 $ 341,324 $ (5,299) $ 336,025 Cost of sales 78,811 (32) 78,779 215,344 (194) 215,150 Income tax expense (benefit) (1,790) (676) (2,466) (24,969) (1,365) (26,334) Net income (loss) (21,884) (1,856) (23,740) (39,177) (3,741) (42,918) Diluted earnings (loss) per share (0.47) (0.04) (0.51) (0.91) (0.09) (1.00) The Company’s adoption of the standard had no impact to cash provided by or used in operating, investing, or financing activities on the Consolidated Statements of Cash Flows.
Revenue Recognition	Revenue Recognition Revenue is recognized upon the transfer of control of the promised product or service to the customer in an amount that reflects the consideration the Company expects to receive in exchange for such product or service. The Company’s contracts with customers generally do not contain variable consideration. In the rare instances where variable consideration is included, the Company estimates the amount of variable consideration and determines what portion of that, if any, has a high probability of significant subsequent revenue reversal, and if so, that amount is excluded from the transaction price. The Company’s contracts with customers frequently contain multiple deliverables, such as systems, upgrades, components, spare parts, installation, maintenance, and service plans. Judgment is required to properly identify the performance obligations within a contract and to determine how the revenue should be allocated among the performance obligations. The Company also evaluates whether multiple transactions with the same customer or related parties should be considered part of a single contract 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. When there are separate units of accounting, the Company allocates revenue to each performance obligation on a relative stand-alone selling price basis. The stand-alone selling prices are determined based on the prices at which the Company separately sells the systems, upgrades, components, spare parts, installation, maintenance, and service plans. For items that are not sold separately, the Company estimates stand-alone selling prices generally using an expected cost plus margin approach. Most of the Company’s revenue is recognized at a point in time when the performance obligation is satisfied. The Company considers many facts when evaluating each of its sales arrangements to determine the timing of revenue recognition, including its contractual obligations and the nature of the customer’s post-delivery acceptance provisions. The Company’s system sales arrangements, including certain upgrades, generally include field acceptance provisions that may include functional or mechanical test procedures. For many of these arrangements, a customer source inspection of the system is performed in the Company’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 the Company objectively demonstrates that the criteria specified in the contractual acceptance provisions are achieved prior to delivery, transfer of control of the product to the customer is considered to have occurred and revenue is recognized upon system delivery since there is no substantive contingency remaining related to the acceptance provisions at that date. For new products, new applications of existing products, or for products with substantive customer acceptance provisions where the Company cannot objectively demonstrate that the criteria specified in the contractual acceptance provisions have been achieved prior to delivery, revenue and the associated costs are deferred. The Company recognizes such revenue and costs upon obtaining objective evidence that the acceptance provisions can be achieved, assuming all other revenue recognition criteria have been met. In certain cases the Company’s contracts with customers contain a billing retention, typically 10% of the sales price, which is billed by the Company and payable by the customer when field acceptance provisions are completed. Revenue recognized in advance of the amount that has been billed is recorded as a contract asset on the Consolidated Balance Sheets. The Company recognizes revenue related to maintenance and service contracts over time based upon the respective contract term. Installation revenue is recognized over time as the installation services are performed. The Company recognizes revenue from the sales of components, spare parts, and specified service engagements at a point in time, which is typically consistent with the time of delivery in accordance with the terms of the applicable sales arrangement. The Company may receive customer deposits on system transactions. The timing of the transfer of goods or services related to the deposits is either at the discretion of the customer or expected to be within one year from the deposit receipt. As such, the Company does not adjust transaction prices for the time value of money. Incremental direct costs incurred related to the acquisition of a customer contract, such as sales commissions, are expensed as incurred since the expected amortization period is one year or less. The Company has elected to treat shipping and handling costs as a fulfillment activity, and such costs are included in cost of services when the Company recognizes revenue for the related goods. Taxes assessed by governmental authorities that are collected by the Company from a customer are excluded from revenue.
Income Taxes	Income Taxes On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (“2017 Tax Act”), which makes broad and complex changes to the U.S. tax code. Certain income tax effects of the 2017 Tax Act are reflected in the Company’s financial results in accordance with Staff Accounting Bulletin No. 118 (“SAB 118”), which provides SEC staff guidance regarding the application of ASC Topic 740, Income Taxes (“ASC 740”). Refer to Note 10, “Income Taxes,” for further information on the financial statement impact of the 2017 Tax Act. Because of the complexity of the new global intangible low-taxed income (“GILTI”) rule, the Company is continuing to evaluate this provision of the 2017 Tax Act and the application of ASC 740. Under U.S. GAAP, the Company is allowed to make an accounting policy choice of either (1) treating taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (“period cost method”) or (2) factoring such amounts into a company’s measurement of its deferred taxes (“deferred method”). The Company’s selection of an accounting policy with respect to the new GILTI tax rules will depend, in part, on analyzing its global income to determine whether it expects to have future U.S. inclusions in taxable income related to GILTI, and if so, what the impact will be. This assessment depends not only on the Company’s current structure and estimated future results of global operations, but also on its intent and ability to modify its structure and/or business. The Company is not yet able to reasonably estimate the effect of this provision of the 2017 Tax Act; therefore, the Company has not made any deferred tax adjustments related to potential GILTI tax in its consolidated financial statements and has not made a policy election decision regarding whether to record deferred taxes on GILTI.
Recent Accounting Pronouncements and Recently Adopted Accounting Pronouncements	Recent Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02: Leases , which generally requires operating lessee rights and obligations to be recognized as assets and liabilities on the balance sheet. In addition, in July 2018, the FASB issued ASU 2018-11: Leases, Targeted Improvements , which adds a transition option whereby companies can recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption rather than in the earliest period presented. The Company plans to adopt using this transition option. These ASUs are effective for fiscal years beginning after December 15, 2018. The Company is evaluating the impact of adopting these ASUs on the consolidated financial statements. The Company 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 the Company’s consolidated financial statements. Recently Adopted Accounting Pronouncements The Company adopted ASU 2016-01, Financial Instruments – Overall , as of January 1, 2018. This ASU requires certain equity investments to be measured at fair value, with changes in fair value recognized in net income. The Company measures equity investments without readily observable market prices at cost, adjusted for changes in observable prices minus impairment. Changes in measurement are included in “Other, net” in the Consolidated Statements of Operations. This ASU has not had a material impact on the consolidated financial statements upon adoption, and the Company will monitor its equity investments each reporting period for changes in observable market prices, if any, which may be material in future periods. The Company adopted ASU 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory , as of January 1, 2018. This ASU requires the Company to recognize the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. This ASU has not had a material impact on the consolidated financial statements. The Company adopted ASU 2016-18, Statement of Cash Flows: Restricted Cash , as of January 1, 2018. This ASU requires the Company to include restricted cash with cash and cash equivalents when reconciling the beginning and end of period total amounts shown on the Statement of Cash Flows. This ASU has not had a material impact on the consolidated financial statements.

Basis of Presentation (Tables)

Basis of Presentation (Tables)	9 Months Ended
	Sep. 30, 2018
Change in Accounting Principle
Summary of impact on adoption of accounting standards on previously reported financial position and results	December 31, 2017 As reported Adjustments As adjusted (in thousands) Balance Sheet Contract assets $ — $ 160 $ 160 Deferred cost of sales 16,060 (66) 15,994 Deferred income taxes 2,953 94 3,047 Accrued expenses and other current liabilities 60,339 (2,271) 58,068 Customer deposits and deferred revenue 108,953 3,079 112,032 Additional paid-in capital 1,053,079 (1,126) 1,051,953 Accumulated deficit (213,376) 506 (212,870) Three months ended September 30, 2017 Nine months ended September 30, 2017 As reported Adjustments As adjusted As reported Adjustments As adjusted (in thousands, except per share amounts) Statement of Operations Net sales $ 131,872 $ (2,564) $ 129,308 $ 341,324 $ (5,299) $ 336,025 Cost of sales 78,811 (32) 78,779 215,344 (194) 215,150 Income tax expense (benefit) (1,790) (676) (2,466) (24,969) (1,365) (26,334) Net income (loss) (21,884) (1,856) (23,740) (39,177) (3,741) (42,918) Diluted earnings (loss) per share (0.47) (0.04) (0.51) (0.91) (0.09) (1.00)

Income (Loss) Per Common Share

Income (Loss) Per Common Share (Tables)	9 Months Ended
	Sep. 30, 2018
Income (Loss) Per Common Share
Schedule of basic and diluted income (loss) per share and weighted average shares	Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands, except per share amounts) Net income (loss) $ (8,953) $ (23,740) $ (262,414) $ (42,918) Net income (loss) per common share: Basic $ (0.19) $ (0.51) $ (5.55) $ (1.00) Diluted $ (0.19) $ (0.51) $ (5.55) $ (1.00) Basic weighted average shares outstanding 46,982 46,941 47,283 43,100 Effect of potentially dilutive share-based awards — — — — Diluted weighted average shares outstanding 46,982 46,941 47,283 43,100 Unvested participating shares excluded from basic weighted average shares outstanding since the securityholders are not obligated to fund losses 2 166 2 166 Common share equivalents excluded from the diluted weighted average shares outstanding since Veeco incurred a net loss and their effect would be antidilutive 16 220 17 275 Potentially dilutive non-participating shares excluded from the diluted calculation as their effect would be antidilutive 2,617 1,956 2,469 1,628 Maximum potential shares to be issued for settlement of Convertible Senior Notes excluded from the diluted calculation as their effect would be antidilutive 8,618 8,618 8,618 8,618

Business Combinations (Tables)

Business Combinations (Tables)	9 Months Ended
	Sep. 30, 2018
Business Combinations
Schedule of pro forma financial information	Three months ended September 30, Nine months ended September 30, 2017 2017 (in thousands, except per share amounts) Net sales $ 129,308 $ 406,767 Loss before income taxes (24,847) (72,091) Diluted earnings per share $ (0.49) $ (1.23)

Assets (Tables)

Assets (Tables)	9 Months Ended
	Sep. 30, 2018
Assets
Schedule of portion of Veeco's assets (excluding cash balances) that are measured at fair value on a recurring basis	Level 1 Level 2 Level 3 Total (in thousands) September 30, 2018 Short-term investments U.S. treasuries $ 36,527 $ — $ — $ 36,527 Corporate debt — 8,561 — 8,561 Commercial paper — 6,975 — 6,975 Total $ 36,527 $ 15,536 $ — $ 52,063 December 31, 2017 Cash equivalents U.S. treasuries $ 12,490 $ — $ — $ 12,490 Total $ 12,490 $ — $ — $ 12,490 Short-term investments U.S. treasuries $ 33,895 $ — $ — $ 33,895 Corporate debt — 10,886 — 10,886 Commercial paper — 2,999 — 2,999 Total $ 33,895 $ 13,885 $ — $ 47,780
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) September 30, 2018 U.S. treasuries $ 36,538 $ 1 $ (12) $ 36,527 Corporate debt 8,573 — (12) 8,561 Commercial paper 6,975 — — 6,975 Total $ 52,086 $ 1 $ (24) $ 52,063 December 31, 2017 U.S. treasuries $ 33,914 $ — $ (19) $ 33,895 Corporate debt 10,894 — (8) 10,886 Commercial paper 2,999 — — 2,999 Total $ 47,807 $ — $ (27) $ 47,780
Summary of fair value and unrealized losses of available-for-sale securities in a loss position	September 30, 2018 December 31, 2017 Gross Gross Estimated Unrealized Estimated Unrealized Fair Value Losses Fair Value Losses (in thousands) U.S. treasuries $ 29,621 $ (12) $ 33,895 $ (19) Corporate debt 8,561 (12) 10,886 (8) Total $ 38,182 $ (24) $ 44,781 $ (27)
Schedule of inventories	September 30, December 31, 2018 2017 (in thousands) Materials $ 84,864 $ 59,919 Work-in-process 41,423 37,222 Finished goods 23,545 23,125 Total $ 149,832 $ 120,266
Schedule of property, plant, and equipment	September 30, December 31, 2018 2017 (in thousands) Land $ 5,669 $ 5,669 Building and improvements 59,547 54,449 Machinery and equipment (1) 126,126 126,829 Leasehold improvements 8,802 10,073 Gross property, plant, and equipment 200,144 197,020 Less: accumulated depreciation and amortization 119,518 111,962 Net property, plant, and equipment $ 80,626 $ 85,058 (1) Machinery and equipment also includes software, furniture and fixtures
Schedule of intangible assets excluding goodwill	September 30, 2018 December 31, 2017 Accumulated Accumulated Gross Amortization Gross Amortization Carrying and Net Carrying and Net Amount Impairment Amount Amount Impairment Amount (in thousands) Technology $ 320,888 $ 273,821 $ 47,067 $ 307,588 $ 133,121 $ 174,467 Customer relationships 164,595 134,760 29,835 164,595 39,336 125,259 In-process R&D 30,040 25,000 5,040 43,340 — 43,340 Trademarks and tradenames 30,910 23,560 7,350 30,910 4,321 26,589 Other 3,686 3,580 106 3,686 3,498 188 Total $ 550,119 $ 460,721 $ 89,398 $ 550,119 $ 180,276 $ 369,843
Schedule of estimated annual amortization expense, excluding in-process R&D for intangible assets with definite useful lives	Amortization (in thousands) 2018 $ 4,184 2019 16,554 2020 15,628 2021 12,506 2022 10,172 Thereafter 25,314 Total $ 84,358

Liabilities (Tables)

Liabilities (Tables)	9 Months Ended
	Sep. 30, 2018
Liabilities
Schedule of accrued expenses and other current liabilities	September 30, December 31, 2018 2017 (in thousands) Payroll and related benefits $ 18,498 $ 32,996 Warranty 7,371 6,532 Interest 1,992 4,430 Professional fees 3,457 3,942 Merger consideration payable — 2,662 Sales, use, and other taxes 532 2,144 Restructuring liability 2,901 1,520 Other 5,679 3,842 Total $ 40,430 $ 58,068
Schedule of changes in product warranty reserves	(in thousands) Balance - December 31, 2017 $ 6,532 Warranties issued 5,249 Consumption of reserves (5,161) Changes in estimate 751 Balance - September 30, 2018 $ 7,371
Schedule of restructuring accrual activities	Personnel Facility Severance and Related Costs Related Costs and Other Total (in thousands) Balance - December 31, 2017 $ 1,520 $ — $ 1,520 Provision 3,930 2,743 6,673 Payments (2,898) (2,394) (5,292) Balance - September 30, 2018 $ 2,552 $ 349 $ 2,901
Schedule of changes in deferred revenue	(in thousands) Balance - December 31, 2017 $ 70,536 Deferral of revenue 7,166 Recognition of previously deferred revenue (33,224) Balance - September 30, 2018 $ 44,478
Schedule of carrying value of Convertible Senior Notes	September 30, December 31, 2018 2017 (in thousands) Principal amount $ 345,000 $ 345,000 Unamortized debt discount (55,082) (63,022) Unamortized transaction costs (5,549) (6,348) Net carrying value $ 284,369 $ 275,630
Summary of interest expense related to Convertible Senior Notes	Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands) Cash Interest Expense Coupon interest expense $ 2,329 $ 2,329 $ 6,986 $ 6,573 Non-Cash Interest Expense Amortization of debt discount 2,697 2,502 7,940 6,942 Amortization of transaction costs 271 252 799 699 Total Interest Expense $ 5,297 $ 5,083 $ 15,725 $ 14,214

Derivative Financial Instrume_2

Derivative Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2018
Derivative Financial Instruments
Schedule of notional amount and fair value of derivatives	September 30, 2018 December 31, 2017 Fair Value Maturity Dates Notional Amount Fair Value Maturity Dates Notional Amount (in thousands) Foreign currency exchange forwards $ (2) October 2018 $ 4,584 $ — January 2018 $ 622
Schedule of gains and (losses) and weighted average notional amount of derivatives	Three months ended September 30, 2018 Three months ended September 30, 2017 Gains (Losses) Weighted average Gains (Losses) Weighted average (in thousands) Foreign currency exchange forwards $ 132 $ 4,448 $ (10) $ 361 Nine months ended September 30, 2018 Nine months ended September 30, 2017 Gains (Losses) Weighted average Gains (Losses) Weighted average (in thousands) Foreign currency exchange forwards $ 348 $ 2,869 $ (9) $ 317

Equity (Tables)

Equity (Tables)	9 Months Ended
	Sep. 30, 2018
Equity
Schedule of the changes in the balances of each component of AOCI, net of tax	Unrealized Foreign Gains (Losses) on Currency Available for Sale Translation Securities Total (in thousands) Balance - December 31, 2017 $ 1,839 $ (27) $ 1,812 Other comprehensive income (loss) (4) 4 — Balance - September 30, 2018 $ 1,835 $ (23) $ 1,812

Share-based compensation (Table

Share-based compensation (Tables)	9 Months Ended
	Sep. 30, 2018
Share-based compensation
Schedule of share-based compensation expense	Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands) Cost of sales $ 513 $ 740 $ 1,603 $ 1,898 Research and development 709 849 2,728 1,986 Selling, general, and administrative 1,890 3,714 7,393 10,182 Restructuring 167 867 996 1,707 Acquisition costs — — — 4,203 Total $ 3,279 $ 6,170 $ 12,720 $ 19,976
Summary of stock option activity	Weighted Number of Average Shares Exercise Price (in thousands) Balance - December 31, 2017 1,394 $ 34.97 Expired or forfeited (147) 36.50 Balance - September 30, 2018 1,247 34.79
Summary of restricted and performance shares activity	Weighted Average Number of Grant Date Shares Fair Value (in thousands) Balance - December 31, 2017 1,880 $ 25.41 Granted 835 19.31 Performance award adjustments (5) 32.67 Vested (508) 26.44 Forfeited (253) 24.83 Balance - September 30, 2018 1,949 22.59

Income Taxes (Tables)

Income Taxes (Tables)	9 Months Ended
	Sep. 30, 2018
Income Taxes
Schedule of loss before income taxes and income tax benefit	Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands) Loss before income taxes $ (8,652) $ (26,206) $ (290,368) $ (69,252) Income tax expense (benefit) $ 301 $ (2,466) $ (27,954) $ (26,334)

Segment Reporting and Geograp_2

Segment Reporting and Geographic Information (Tables)	9 Months Ended
	Sep. 30, 2018
Segment Reporting and Geographic Information
Schedule of sales by end-market	Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 (in thousands) Sales by end-market Advanced Packaging, MEMS & RF Filters $ 24,562 $ 21,478 $ 76,473 $ 54,216 LED Lighting, Display & Compound Semiconductor 58,864 57,647 236,597 167,105 Front-End Semiconductor 13,476 16,256 41,085 27,736 Scientific & Industrial 29,855 33,927 88,955 86,968 Total $ 126,757 $ 129,308 $ 443,110 $ 336,025 Sales by geographic region United States $ 28,861 $ 34,914 $ 85,555 $ 72,820 China 39,200 12,956 185,050 81,121 EMEA (1) 30,685 16,948 71,836 54,140 Rest of World 28,011 64,490 100,669 127,944 Total $ 126,757 $ 129,308 $ 443,110 $ 336,025 (1) EMEA consists of Europe, the Middle East, and Africa

Basis of Presentation - Fiscal

Basis of Presentation - Fiscal Period (Details)	9 Months Ended
	Sep. 30, 2018
Basis of Presentation
Quarter fiscal period duration (in days)	91 days

Basis of Presentation - Change

Basis of Presentation - Change in Accounting Policy (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Jan. 01, 2016
Accounting Changes
Accumulated deficit	$ (475,284)	$ (212,870)
Adjustments for adoption of guidance | Accounting Standards Update 2014-09, Revenue from Contracts with Customers
Accounting Changes
Accumulated deficit		$ 506	$ 6,900

Basis of Presentation - Chang_2

Basis of Presentation - Change in Accounting Policy - Balance Sheet (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Jan. 01, 2016
Accounting Changes
Contract assets	$ 7,441	$ 160
Deferred cost of sales	2,986	15,994
Deferred income taxes	2,183	3,047
Accrued expenses and other current liabilities	40,430	58,068
Customer deposits and deferred revenue	64,443	112,032
Additional paid-in capital	1,060,733	1,051,953
Accumulated deficit	$ (475,284)	(212,870)
Accounting Standards Update 2014-09, Revenue from Contracts with Customers | Previously Reported
Accounting Changes
Deferred cost of sales		16,060
Deferred income taxes		2,953
Accrued expenses and other current liabilities		60,339
Customer deposits and deferred revenue		108,953
Additional paid-in capital		1,053,079
Accumulated deficit		(213,376)
Accounting Standards Update 2014-09, Revenue from Contracts with Customers | Adjustments for adoption of guidance
Accounting Changes
Contract assets		160
Deferred cost of sales		(66)
Deferred income taxes		94
Accrued expenses and other current liabilities		(2,271)
Customer deposits and deferred revenue		3,079
Additional paid-in capital		(1,126)
Accumulated deficit		$ 506	$ 6,900

Basis of Presentation - Chang_3

Basis of Presentation - Change in Accounting Policy - Statement of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Accounting Changes
Net sales	$ 126,757	$ 129,308	$ 443,110	$ 336,025
Cost of sales	80,372	78,779	284,651	215,150
Income tax expense (benefit)	301	(2,466)	(27,954)	(26,334)
Net income (loss)	$ (8,953)	$ (23,740)	$ (262,414)	$ (42,918)
Diluted earnings (loss) per share (in dollars per share)	$ (0.19)	$ (0.51)	$ (5.55)	$ (1)
Previously Reported | Accounting Standards Update 2014-09, Revenue from Contracts with Customers
Accounting Changes
Net sales		$ 131,872		$ 341,324
Cost of sales		78,811		215,344
Income tax expense (benefit)		(1,790)		(24,969)
Net income (loss)		$ (21,884)		$ (39,177)
Diluted earnings (loss) per share (in dollars per share)		$ (0.47)		$ (0.91)
Adjustments for adoption of guidance | Accounting Standards Update 2014-09, Revenue from Contracts with Customers
Accounting Changes
Net sales		$ (2,564)		$ (5,299)
Cost of sales		(32)		(194)
Income tax expense (benefit)		(676)		(1,365)
Net income (loss)		$ (1,856)		$ (3,741)
Diluted earnings (loss) per share (in dollars per share)		$ (0.04)		$ (0.09)

Basis of Presentation - Chang_4

Basis of Presentation - Change in Accounting Policy - Revenue Recognition (Details)	9 Months Ended
	Sep. 30, 2018
Adjustments for adoption of guidance | Accounting Standards Update 2014-09, Revenue from Contracts with Customers
Accounting Changes
Billing retention recognized at time of transfer of control (as a percent)	10.00%

Income (Loss) Per Common Shar_2

Income (Loss) Per Common Share - Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income (Loss) Per Common Share
Net income (loss)	$ (8,953)	$ (23,740)	$ (262,414)	$ (42,918)
Net income (loss) per common share:
Basic (in dollars per share)	$ (0.19)	$ (0.51)	$ (5.55)	$ (1)
Diluted (in dollars per share)	$ (0.19)	$ (0.51)	$ (5.55)	$ (1)
Weighted average shares reconciliation
Basic weighted average shares outstanding	46,982	46,941	47,283	43,100
Diluted weighted average shares outstanding	46,982	46,941	47,283	43,100

Income (Loss) Per Common Shar_3

Income (Loss) Per Common Share - Shares Excluded from EPS (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Unvested participating shares
Basic income (loss) per share
Unvested participating shares excluded from basic weighted average shares outstanding since the securityholders are not obligated to fund losses	2	166	2	166
Common Stock
Diluted income (loss) per share
Common share equivalents excluded from the diluted weighted average shares outstanding since Veeco incurred a net loss and their effect would be antidilutive	16	220	17	275
Non-participating shares
Diluted income (loss) per share
Shares excluded from the diluted calculation as their effect would be antidilutive	2,617	1,956	2,469	1,628
Convertible Notes
Diluted income (loss) per share
Shares excluded from the diluted calculation as their effect would be antidilutive	8,618	8,618	8,618	8,618

Business Combinations - Ultrate

Business Combinations - Ultratech (Details) - USD ($) $ / shares in Units, $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017	May 26, 2017
Ultratech
Business Combinations
Cash received by acquiree (in dollars per share)			$ 21.75
Number of shares received by acquiree			0.2675
Accrued Expenses and Other Current Liabilities
Business Combinations
Cash consideration, net of cash acquired	$ 2.7	$ 2.7

Business Combinations - ProForm

Business Combinations - ProForma (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2017
Pro forma consolidated statement of operations
Net sales	$ 129,308	$ 406,767
Loss before income taxes	$ (24,847)	$ (72,091)
Diluted earnings per share (in dollars per share)	$ (0.49)	$ (1.23)

Assets - Fair Value (Details)

Assets - Fair Value (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Cash equivalents
Total	$ 213,506	$ 279,736
Short-term investments
Total	52,063	47,780
Transfer of assets from Level 1 to Level 2	0
Transfer of assets from Level 2 to Level 1	0
Transfer of Liabilities from Level 1 to Level 2	0
Transfer of Liabilities from Level 2 to Level 1	0
Measured at fair value on a recurring basis
Cash equivalents
Total		12,490
Short-term investments
Total	52,063	47,780
Measured at fair value on a recurring basis | U.S. treasuries
Cash equivalents
Total		12,490
Short-term investments
Total	36,527	33,895
Measured at fair value on a recurring basis | Corporate debt
Short-term investments
Total	8,561	10,886
Measured at fair value on a recurring basis | Commercial paper
Short-term investments
Total	6,975	2,999
Measured at fair value on a recurring basis | Level 1
Cash equivalents
Total		12,490
Short-term investments
Total	36,527	33,895
Measured at fair value on a recurring basis | Level 1 | U.S. treasuries
Cash equivalents
Total		12,490
Short-term investments
Total	36,527	33,895
Measured at fair value on a recurring basis | Level 2
Short-term investments
Total	15,536	13,885
Measured at fair value on a recurring basis | Level 2 | Corporate debt
Short-term investments
Total	8,561	10,886
Measured at fair value on a recurring basis | Level 2 | Commercial paper
Short-term investments
Total	$ 6,975	$ 2,999

Assets - Available-For-Sale Sec

Assets - Available-For-Sale Securities (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Total available-for-sale securities
Amortized Cost	$ 52,086		$ 52,086		$ 47,807
Gross Unrealized Gains	1		1
Gross Unrealized Losses	(24)		(24)		(27)
Estimated Fair Value	52,063		52,063		47,780
Available-for-sale securities in a loss position
Estimated Fair Value	38,182		38,182		44,781
Gross Unrealized Losses	(24)		(24)		(27)
Investments that had been in a continuous loss position for more than 12 months	0		0		0
Realized gains	0	$ 0	0	$ 0
Realized losses	0		0
U.S. treasuries
Total available-for-sale securities
Amortized Cost	36,538		36,538		33,914
Gross Unrealized Gains	1		1
Gross Unrealized Losses	(12)		(12)		(19)
Estimated Fair Value	36,527		36,527		33,895
Available-for-sale securities in a loss position
Estimated Fair Value	29,621		29,621		33,895
Gross Unrealized Losses	(12)		(12)		(19)
Corporate debt
Total available-for-sale securities
Amortized Cost	8,573		8,573		10,894
Gross Unrealized Losses	(12)		(12)		(8)
Estimated Fair Value	8,561		8,561		10,886
Available-for-sale securities in a loss position
Estimated Fair Value	8,561		8,561		10,886
Gross Unrealized Losses	(12)		(12)		(8)
Commercial paper
Total available-for-sale securities
Amortized Cost	6,975		6,975		2,999
Estimated Fair Value	$ 6,975		$ 6,975		$ 2,999

Assets - Accounts Receivable (D

Assets - Accounts Receivable (Details) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
Assets
Allowance for doubtful accounts receivable	$ 0.3	$ 0.3

Assets - Inventories (Details)

Assets - Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Inventories
Materials	$ 84,864	$ 59,919
Work-in-process	41,423	37,222
Finished goods	23,545	23,125
Total	$ 149,832	$ 120,266

Assets - Prepaid Expenses and O

Assets - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
Prepaid expenses and other current assets
Deposits with suppliers	$ 8.9	$ 7.6

Assets - Property, Plant, and E

Assets - Property, Plant, and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Property, plant, and equipment
Gross property, plant and equipment	$ 200,144		$ 200,144		$ 197,020
Less: accumulated depreciation and amortization	119,518		119,518		111,962
Net property, plant, and equipment	80,626		80,626		85,058
Depreciation expense	4,600	$ 4,200	13,000	$ 10,600
Land
Property, plant, and equipment
Gross property, plant and equipment	5,669		5,669		5,669
Building and improvements
Property, plant, and equipment
Gross property, plant and equipment	59,547		59,547		54,449
Machinery and equipment
Property, plant, and equipment
Gross property, plant and equipment	126,126		126,126		126,829
Leaseholds improvements
Property, plant, and equipment
Gross property, plant and equipment	$ 8,802		$ 8,802		$ 10,073

Assets - Goodwill (Details)

Assets - Goodwill (Details) $ in Millions	9 Months Ended
	Sep. 30, 2018USD ($)D	Oct. 01, 2018USD ($)
Goodwill
Changes in goodwill during the period	$ 0
Number of trading days used in adjusted market capitalization calculation | D	10
Amount of fair value of reporting unit in excess of carrying amount		$ 60

Assets - Intangible Assets (Det

Assets - Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended
	Jun. 30, 2018	Sep. 30, 2018	Dec. 31, 2017
Intangible assets
Impairment charges, Definite-lived intangible assets	$ 216,400
Net Amount, Definite-lived intangible assets		$ 84,358
Total Gross Intangible Assets		550,119	$ 550,119
Accumulated Amortization and Impairment		460,721	180,276
Total Net Intangible Assets		89,398	369,843
In-process research and development
Intangible assets
Impairment charges, Indefinite-lived intangible assets	$ 35,900
Gross Carrying Amount, Indefinite-lived intangible assets		30,040	43,340
Accumulated Amortization and Impairment, Indefinite-lived intangible assets		25,000
Net Amount, Indefinite-lived intangible assets		5,040	43,340
Technology
Intangible assets
Gross Carrying Amount, Definite-lived intangible assets		320,888	307,588
Accumulated Amortization and Impairment, Definite-lived intangible assets		273,821	133,121
Net Amount, Definite-lived intangible assets		47,067	174,467
Customer relationship
Intangible assets
Gross Carrying Amount, Definite-lived intangible assets		164,595	164,595
Accumulated Amortization and Impairment, Definite-lived intangible assets		134,760	39,336
Net Amount, Definite-lived intangible assets		29,835	125,259
Trademarks and tradenames
Intangible assets
Gross Carrying Amount, Definite-lived intangible assets		30,910	30,910
Accumulated Amortization and Impairment, Definite-lived intangible assets		23,560	4,321
Net Amount, Definite-lived intangible assets		7,350	26,589
Other Intangible Assets
Intangible assets
Gross Carrying Amount, Definite-lived intangible assets		3,686	3,686
Accumulated Amortization and Impairment, Definite-lived intangible assets		3,580	3,498
Net Amount, Definite-lived intangible assets		$ 106	$ 188

Assets - Intangible Assets - Am

Assets - Intangible Assets - Amortization (Details) $ in Thousands	Sep. 30, 2018USD ($)
Estimated annual amortization expense
2,018	$ 4,184
2,019	16,554
2,020	15,628
2,021	12,506
2,022	10,172
Thereafter	25,314
Net Amount, Definite-lived intangible assets	$ 84,358

Assets - Other Assets (Details)

Assets - Other Assets (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Kateeva
Other Investment Not Readily Marketable [Line Items]
Carrying amount	$ 21	$ 21
Kateeva | Maximum
Other Investment Not Readily Marketable [Line Items]
Percentage ownership of cost method investee	20.00%
Separate non-marketable investment
Other Investment Not Readily Marketable [Line Items]
Amount of investment made	$ 3.5
Separate non-marketable investment | Maximum
Other Investment Not Readily Marketable [Line Items]
Percentage ownership of cost method investee	20.00%

Liabilities - Accrued Expenses

Liabilities - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Accrued expenses and other current liabilities
Payroll and related benefits	$ 18,498	$ 32,996
Warranty	7,371	6,532
Interest	1,992	4,430
Professional fees	3,457	3,942
Merger consideration payable		2,662
Sales, use, and other taxes	532	2,144
Restructuring liability	2,901	1,520
Other	5,679	3,842
Total	$ 40,430	$ 58,068

Liabilities - Warranty (Details

Liabilities - Warranty (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2018USD ($)
Warranty
Warranty period	1 year
Balance, beginning of the year	$ 6,532
Warranties issued	5,249
Consumption of reserves	(5,161)
Changes in estimate	751
Balance, end of the year	$ 7,371

Liabilities - Restructuring Acc

Liabilities - Restructuring Accruals (Details) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2018USD ($)employee	Jun. 30, 2018USD ($)employee	Sep. 30, 2017USD ($)	Sep. 30, 2018USD ($)	Sep. 30, 2017USD ($)
Restructuring Accruals
Number of employees terminated | employee	35	40
Restructuring charges	$ 2,057		$ 5,010	$ 7,669	$ 9,605
Annualized savings	5,000
Restructuring accruals roll forward
Balance at the beginning of the period				1,520
Provision				6,673
Payments				(5,292)
Balance at the end of the period	2,901			2,901
Non-cash charges related to share based compensation				12,720	$ 19,976
Minimum
Restructuring Accruals
Additional restructuring costs expected over the next few quarters	1,000			1,000
Maximum
Restructuring Accruals
Additional restructuring costs expected over the next few quarters	2,000			2,000
Restructuring
Restructuring accruals roll forward
Non-cash charges related to share based compensation				1,000
Personnel severance and related costs
Restructuring Accruals
Restructuring charges	1,100	$ 2,400
Restructuring accruals roll forward
Balance at the beginning of the period				1,520
Provision				3,930
Payments				(2,898)
Balance at the end of the period	2,552			2,552
Facility Closing Costs
Restructuring accruals roll forward
Provision				2,743
Payments				(2,394)
Balance at the end of the period	$ 349			$ 349

Liabilities - Customer Deposits

Liabilities - Customer Deposits and Deferred Revenue (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Liabilities
Customer deposits	$ 20,000	$ 41,500
Movement in Deferred Revenue
Beginning balance	70,536
Deferral of revenue	7,166
Recognition of previously deferred revenue	(33,224)
Ending balance	$ 44,478

Liabilities - Performance Oblig

Liabilities - Performance Obligations Amount (Details) $ in Millions	Sep. 30, 2018USD ($)
Liabilities
Remaining performance obligations	$ 63
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01
Performance obligations
Percentage of remaining performance obligation expected to be recognized	64.00%

Liabilities - Performance Obl_2

Liabilities - Performance Obligations Timing (Details)	9 Months Ended
	Sep. 30, 2018
Liabilities
Revenue, Practical Expedient, Remaining Performance Obligation	true
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01
Performance obligations
Remaining performance obligations, expected timing of satisfaction	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-10-01
Performance obligations
Remaining performance obligations, expected timing of satisfaction	2 years

Liabilities - Convertible Senio

Liabilities - Convertible Senior Notes (Details) - USD ($) $ in Thousands	Jan. 10, 2017	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Long-term debt
Proceeds received, net of transaction fees					$ 335,752
Convertible Notes
Long-term debt
Principal amount	$ 345,000	$ 345,000		$ 345,000		$ 345,000
Interest rate (as a percent)	2.70%
Proceeds received, net of transaction fees	$ 335,800
Unamortized debt discount		(55,082)		(55,082)		(63,022)
Unamortized transaction costs		(5,549)		(5,549)		(6,348)
Net carrying value		284,369		284,369		$ 275,630
Cash Interest Expense
Coupon interest expense		2,329	$ 2,329	6,986	6,573
Non-Cash Interest Expense
Amortization of debt discount		2,697	2,502	7,940	6,942
Amortization of transaction costs		271	252	799	699
Total Interest Expense		5,297	$ 5,083	15,725	$ 14,214
Convertible Notes | Level 2
Non-Cash Interest Expense
Estimated fair value of convertible senior notes		$ 292,000		$ 292,000

Liabilities - Other Liabilities

Liabilities - Other Liabilities (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Other Assets
Other Liabilities
Cash surrender value of life insurance policies	$ 3.6	$ 3.4
Other Liabilities
Other Liabilities
Plan liabilities	3.9	4.7
Asset retirement obligations	3.2	3.3
Medical and dental benefits	$ 2.1	$ 2.2

Commitments and Contingencies -

Commitments and Contingencies - Purchase Commitments and Bank Guarantees (Details) $ in Millions	Sep. 30, 2018USD ($)
Purchase commitments
Purchase commitments due within one year	$ 114
Bank guarantees
Bank guarantees and letters of credit outstanding	6.9
Unused bank guarantees and letters of credit	$ 64

Commitments and Contingencies_2

Commitments and Contingencies - Legal Proceedings (Detail) - Ultratech acquisition litigation - case	Aug. 08, 2018	Sep. 30, 2018
Legal Proceedings
Number of purported class action complaints filed	2
Number of cases expected to be consolidated		3

Commitments and Contingencies_3

Commitments and Contingencies - Receivable Purchase Agreement (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Sep. 30, 2018
Commitments and Contingencies
Trade receivables from customers without recourse to be sold, maximum amount	$ 23	$ 23
Receivable Purchase Agreement, term	1 year
Trade receivables, sold		$ 0

Derivative Financial Instrume_3

Derivative Financial Instruments (Details) - Not Designated as Hedges - Foreign currency exchange forwards - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Derivative Financial Instruments
Fair Value	$ (2)		$ (2)
Notional Amounts	4,584		4,584		$ 622
Gains (losses)	132	$ (10)	348	$ (9)
Weighted average notional amount	$ 4,448	$ 361	$ 2,869	$ 317

Equity - AOCI Rollforward (Deta

Equity - AOCI Rollforward (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Changes in the balances of each component of AOCI
Balance at the beginning of the period		$ 840,093
Other comprehensive income (loss)	$ 71		$ 35
Balance at the end of the period		578,087
Accumulated Other Comprehensive Income
Changes in the balances of each component of AOCI
Balance at the beginning of the period		1,812
Balance at the end of the period		1,812
Foreign Currency Translation
Changes in the balances of each component of AOCI
Balance at the beginning of the period		1,839
Other comprehensive income (loss)		(4)
Balance at the end of the period		1,835
Unrealized Gains (Losses) on Available for Sale Securities
Changes in the balances of each component of AOCI
Balance at the beginning of the period		(27)
Other comprehensive income (loss)		4
Balance at the end of the period		$ (23)

Share-based compensation (Detai

Share-based compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Share-based compensation
Total	$ 3,279	$ 6,170	$ 12,720	$ 19,976
Cost of Sales
Share-based compensation
Total	513	740	1,603	1,898
Research and Development Expense
Share-based compensation
Total	709	849	2,728	1,986
Selling, General and Administrative Expenses
Share-based compensation
Total	1,890	3,714	7,393	10,182
Restructuring
Share-based compensation
Total	$ 167	$ 867	$ 996	1,707
Acquisition costs
Share-based compensation
Total				$ 4,203
Restricted Stock Awards | Minimum
Share-based compensation
Expiration term			1 year
Restricted Stock Awards | Maximum
Share-based compensation
Expiration term			5 years
Stock options
Number of Shares
Outstanding at the beginning of the period (in shares)			1,394
Expired or forfeited (in shares)			(147)
Outstanding at the end of the period (in shares)	1,247		1,247
Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share)			$ 34.97
Expired or forfeited (in dollars per share)			36.50
Outstanding at the end of the period (in dollars per share)	$ 34.79		$ 34.79
Non-vested restricted shares and performance shares
Number of Shares
Outstanding at the beginning of the period (in shares)			1,880
Granted (in shares)			835
Performance award adjustments (in shares)			(5)
Vested (in shares)			(508)
Forfeited (in shares)			(253)
Outstanding at the end of the period (in shares)	1,949		1,949
Weighted Average Grant Date Fair Value
Outstanding at the beginning of the period (in dollars per share)			$ 25.41
Granted (in dollars per share)			19.31
Performance award adjustments (in dollars per share)			32.67
Vested (in dollars per share)			26.44
Forfeited (in dollars per share)			24.83
Outstanding at the end of the period (in dollars per share)	$ 22.59		$ 22.59

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended		12 Months Ended
	Sep. 30, 2018	Jun. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Income taxes disclosures
U.S. federal statutory rate (as a percent)				21.00%		35.00%
Income tax benefit related to the alternative minimum tax credits		$ 1,600
Tax benefit due to intangible asset impairment charge		25,300
Asset impairment charges		$ 252,300	$ 2	$ 252,343	$ 1,139
Loss before income taxes	$ (8,652)		(26,206)	(290,368)	(69,252)
Income tax expense (benefit)	$ 301		(2,466)	(27,954)	(26,334)
Federal
Income taxes disclosures
Income tax expense (benefit)			(2,800)	(1,100)	(22,700)
Foreign tax
Income taxes disclosures
Income tax expense (benefit)			$ 300	$ (26,900)	$ (3,600)

Segment Reporting and Geograp_3

Segment Reporting and Geographic Information (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018USD ($)	Sep. 30, 2017USD ($)	Sep. 30, 2018USD ($)itemsegment	Sep. 30, 2017USD ($)
Revenue reporting by end-market and geographic region
Number of operating segments | segment			1
Number of reportable segments | segment			1
Number of key markets | item			4
Sale by end-market	$ 126,757	$ 129,308	$ 443,110	$ 336,025
United States
Revenue reporting by end-market and geographic region
Sale by end-market	28,861	34,914	85,555	72,820
China
Revenue reporting by end-market and geographic region
Sale by end-market	39,200	12,956	185,050	81,121
EMEA
Revenue reporting by end-market and geographic region
Sale by end-market	30,685	16,948	71,836	54,140
Rest Of World
Revenue reporting by end-market and geographic region
Sale by end-market	28,011	64,490	100,669	127,944
Advanced Packaging, MEMS & RF Filters
Revenue reporting by end-market and geographic region
Sale by end-market	24,562	21,478	76,473	54,216
LED Lighting, Display & Compound Semiconductor
Revenue reporting by end-market and geographic region
Sale by end-market	58,864	57,647	236,597	167,105
Front-End Semiconductor
Revenue reporting by end-market and geographic region
Sale by end-market	13,476	16,256	41,085	27,736
Scientific & Industrial
Revenue reporting by end-market and geographic region
Sale by end-market	$ 29,855	$ 33,927	$ 88,955	$ 86,968