Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Jul. 22, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | SONUS NETWORKS INC | |
Entity Central Index Key | 1,105,472 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 49,392,197 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 36,261 | $ 50,111 |
Marketable securities | 52,505 | 58,533 |
Accounts receivable, net of allowance for doubtful accounts of $0 at June 30, 2016 and $10 at December 31, 2015 | 36,851 | 51,533 |
Inventory | 20,674 | 23,111 |
Other current assets | 13,763 | 11,853 |
Total current assets | 160,054 | 195,141 |
Property and equipment, net | 12,407 | 13,620 |
Intangible assets, net | 22,368 | 26,087 |
Goodwill | 40,310 | 40,310 |
Investments | 53,942 | 33,605 |
Deferred income taxes | 1,778 | 1,879 |
Other assets | 5,207 | 2,249 |
Total assets | 296,066 | 312,891 |
Current liabilities: | ||
Accounts payable | 4,330 | 5,949 |
Accrued expenses | 20,949 | 31,963 |
Current portion of deferred revenue | 38,148 | 38,716 |
Current portion of long-term liabilities | 898 | 821 |
Total current liabilities | 64,325 | 77,449 |
Deferred revenue | 7,227 | 7,374 |
Deferred income taxes | 2,631 | 2,282 |
Other long-term liabilities | 1,829 | 2,760 |
Total liabilities | 76,012 | 89,865 |
Commitments and contingencies (Note 16) | ||
Stockholders' equity: | ||
Preferred stock, $0.01 par value per share; 5,000,000 shares authorized, none issued and outstanding | 0 | 0 |
Common stock, $0.001 par value per share; 120,000,000 shares authorized; 49,391,336 shares issued and outstanding at June 30, 2016; 49,473,789 shares issued and outstanding at December 31, 2015 | 49 | 49 |
Additional paid-in capital | 1,244,694 | 1,240,803 |
Accumulated deficit | (1,030,812) | (1,023,242) |
Accumulated other comprehensive income | 6,123 | 5,416 |
Total stockholders' equity | 220,054 | 223,026 |
Total liabilities and stockholders' equity | $ 296,066 | $ 312,891 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Allowance for doubtful accounts | $ 0 | $ 10 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 120,000,000 | 120,000,000 |
Common stock, shares issued | 49,391,336 | 49,473,789 |
Common stock, shares outstanding | 49,391,336 | 49,473,789 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 26, 2015 | Jun. 30, 2016 | Jun. 26, 2015 | |
Revenue: | ||||
Product | $ 35,349 | $ 27,042 | $ 70,118 | $ 51,907 |
Service | 25,508 | 27,659 | 49,890 | 52,939 |
Total revenue | 60,857 | 54,701 | 120,008 | 104,846 |
Cost of revenue: | ||||
Product | 11,409 | 11,269 | 22,945 | 22,917 |
Service | 9,220 | 9,018 | 18,432 | 18,285 |
Total cost of revenue | 20,629 | 20,287 | 41,377 | 41,202 |
Gross profit | 40,228 | 34,414 | 78,631 | 63,644 |
Operating expenses: | ||||
Research and development | 17,457 | 19,968 | 34,775 | 39,307 |
Sales and marketing | 16,192 | 17,540 | 32,787 | 37,305 |
General and administrative | 9,287 | 10,444 | 17,658 | 19,668 |
Acquisition-related | 0 | 24 | 0 | 131 |
Restructuring | 0 | 1,487 | 0 | 1,148 |
Total operating expenses | 42,936 | 49,463 | 85,220 | 97,559 |
Loss from operations | (2,708) | (15,049) | (6,589) | (33,915) |
Interest income (expense), net | 217 | (20) | 381 | 8 |
Other income, net | 10 | 5 | 113 | 50 |
Loss before income taxes | (2,481) | (15,064) | (6,095) | (33,857) |
Income tax provision | (435) | (279) | (1,475) | (845) |
Net loss | $ (2,916) | $ (15,343) | $ (7,570) | $ (34,702) |
Loss per share: | ||||
Basic (in dollars per share) | $ (0.06) | $ (0.31) | $ (0.15) | $ (0.70) |
Diluted (in dollars per share) | $ (0.06) | $ (0.31) | $ (0.15) | $ (0.70) |
Shares used to compute loss per share: | ||||
Basic (in shares) | 49,423 | 49,484 | 49,453 | 49,454 |
Diluted (in shares) | 49,423 | 49,484 | 49,453 | 49,454 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 26, 2015 | Jun. 30, 2016 | Jun. 26, 2015 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (2,916) | $ (15,343) | $ (7,570) | $ (34,702) |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustments | 262 | (90) | 435 | (48) |
Unrealized gain (loss) on available-for sale marketable securities, net of tax | 37 | (25) | 272 | 80 |
Reclassification adjustment for losses included in net loss | 0 | 0 | 18 | 0 |
Other comprehensive income (loss), net of tax | 299 | (115) | 725 | 32 |
Comprehensive loss, net of tax | $ (2,617) | $ (15,458) | $ (6,845) | $ (34,670) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 26, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (7,570) | $ (34,702) |
Adjustments to reconcile net loss to cash flows provided by (used in) operating activities: | ||
Depreciation and amortization of property and equipment | 3,970 | 6,902 |
Amortization of intangible assets | 3,719 | 3,238 |
Stock-based compensation | 9,056 | 11,629 |
Loss on disposal of property and equipment | 26 | 22 |
Deferred income taxes | 587 | 335 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 14,955 | 14,223 |
Inventory | 844 | (3,590) |
Other operating assets | (2,566) | (1,389) |
Accounts payable | (1,732) | (1,994) |
Accrued expenses and other long-term liabilities | (11,182) | (13,466) |
Deferred revenue | (888) | 4,524 |
Net cash provided by (used in) operating activities | 9,219 | (14,268) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (2,636) | (4,524) |
Business acquisition, net of cash acquired | (750) | (10,147) |
Purchases of marketable securities | (59,138) | (3,737) |
Maturities/sales of marketable securities | 44,364 | 30,620 |
Net cash (used in) provided by investing activities | (18,160) | 12,212 |
Cash flows from financing activities: | ||
Proceeds from sale of common stock in connection with employee stock purchase plan | 632 | 1,668 |
Proceeds from exercise of stock options | 15 | 1,739 |
Payment of tax withholding obligations related to net share settlements of restricted stock awards | (832) | (2,164) |
Repurchase of common stock | (4,980) | (6,084) |
Principal payments of capital lease obligations | (24) | (41) |
Net cash used in financing activities | (5,189) | (4,882) |
Effect of exchange rate changes on cash and cash equivalents | 280 | (91) |
Net decrease in cash and cash equivalents | (13,850) | (7,029) |
Cash and cash equivalents, beginning of year | 50,111 | 41,157 |
Cash and cash equivalents, end of period | 36,261 | 34,128 |
Supplemental disclosure of cash flow information: | ||
Interest paid | 19 | 30 |
Income taxes paid | 596 | 435 |
Income tax refunds received | 249 | 311 |
Supplemental disclosure of non-cash investing activities: | ||
Capital expenditures incurred, but not yet paid | 256 | 343 |
Capital Lease Obligations Incurred | $ 36 | $ 0 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION Business Sonus Networks, Inc. (“Sonus” or the “Company”) is a leading provider of networked solutions for communications service providers (e.g., telecommunications, wireless and cable service providers) and enterprises to help them advance, protect and unify their communications and improve collaboration. Sonus helps many of the world's leading communications service providers and enterprises embrace the next generation of Session Initiation Protocol ("SIP") and 4G/LTE (Long Term Evolution)-based solutions, including Voice over IP ("VoIP") video and Unified Communications ("UC") through secure, reliable and scalable Internet Protocol ("IP") networks. Sonus' products include session border controllers ("SBCs"), diameter signaling controllers ("DSCs"), policy/routing servers, network intelligence applications ("VellOS") and are designed to provide network-wide security and other cloud network exchange services, media and signaling gateways and network analytics tools. Sonus products are supported by a global services team with experience in design, deployment and maintenance of some of the world's largest IP networks. Sonus utilizes both direct and indirect sales channels to reach its target customers. Customers and prospective customers in the service provider space are traditional and emerging communications service providers, including long distance carriers, local exchange carriers, internet service providers, wireless operators, cable operators, international telephone companies and carriers that provide services to other carriers. Enterprise customers and target enterprise customers include financial institutions, retailers, state and local governments, and other multinational corporations. Basis of Presentation In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting only of normal recurring items, necessary for their fair presentation with accounting principles generally accepted in the United States of America ("GAAP") and with the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). Interim results are not necessarily indicative of results for a full year or any future interim period. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2015 (the "Annual Report"), which was filed with the SEC on February 23, 2016. For the year ended December 31, 2015, the Company reported its first, second and third quarters on a 4-4-5 basis, with the quarter ending on the Friday closest to the last day of each third month. Accordingly, the Company's first quarter ended on March 27, 2015, the second quarter ended on June 26, 2015 and the third quarter ended on September 25, 2015. Effective January 1, 2016, the Company is reporting its first, second and third quarters on a month-end basis, such that the first quarter ended on March 31, 2016, the second quarter ended on June 30, 2016 and the third quarter will end on September 30, 2016. The Company's fiscal year will continue to end on December 31. During the preparation of the Company's consolidated financial statements for the three-month period ended June 26, 2015, the Company identified an error related to the historical foreign translation of depreciation expense on certain foreign fixed assets that resulted in a historical understatement of expense in prior fiscal years totaling $1.4 million on a cumulative basis. There is no tax effect on these expenses as the amounts were calculated in the appropriate foreign currencies. The Company does not believe this error is material to its previously issued historical consolidated financial statements for any of the periods impacted and accordingly, has not adjusted its historical financial statements. The Company recorded the cumulative impact of the adjustment in the three months ended June 26, 2015. This adjustment resulted in a one-time $1.4 million overstatement of depreciation expense. The Company does not believe this adjustment is material to its condensed consolidated financial statements for the periods presented. On January 2, 2015 (the "Treq Asset Acquisition Date"), the Company acquired from Treq Labs, Inc. ("Treq") certain assets related to Treq's business of designing, developing, marketing, selling, servicing and maintaining software-defined networking ("SDN") technology, SDN controller software and SDN management software (the "SDN Business"). The financial results of the SDN Business are included in the Company's condensed consolidated financial statements starting on the Treq Asset Acquisition Date. Significant Accounting Policies The Company's significant accounting policies are disclosed in Note 2 to the Consolidated Financial Statements included in the Annual Report. There were no material changes to the significant accounting policies during either the three or six months ended June 30, 2016 . Principles of Consolidation The condensed consolidated financial statements include the accounts of Sonus and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated in consolidation. Use of Estimates and Judgments The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and judgments relied upon in preparing these consolidated financial statements include accounting for business combinations, revenue recognition for multiple element arrangements, inventory valuations, assumptions used to determine the fair value of stock-based compensation, intangible assets and goodwill valuations, including impairments, legal contingencies and recoverability of Sonus' net deferred tax assets and the related valuation allowances. Sonus regularly assesses these estimates and records changes in estimates in the period in which they become known. Sonus bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results could differ from those estimates. Fair Value of Financial Instruments The carrying amounts of the Company's financial instruments, which include cash equivalents, marketable securities, investments, accounts receivable, accounts payable and other long-term liabilities, approximate their fair values. Operating Segments The Company operates in a single segment. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker in making decisions regarding resource allocation and assessing performance. To date, the chief operating decision maker has made such decisions and assessed performance at the company level, as one segment. The Company's chief operating decision maker is its President and Chief Executive Officer. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instrument s ("ASU 2016-13"), which adds an impairment model that is based on expected losses rather than incurred losses. Under ASU 2016-13, an entity recognizes as an allowance its estimate of expected credit losses, which the FASB believes will result in more timely recognition of such losses. ASU 2016-13 is effective for the Company beginning January 1, 2020 for both interim and annual reporting periods, with early adoption permitted. The Company does not expect the adoption of ASU 2016-13 will have a material impact on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"), which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures and statutory tax withholding requirements, as well as classification in the statement of cash flows. ASU 2016-09 is effective for the Company beginning January 1, 2017 for both interim and annual reporting periods. The Company is currently assessing the potential impact of the adoption of ASU 2016-09 on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) Section A - Leases: Amendments to the FASB Accounting Standards Codification ("ASU 2016-02"), its new standard on accounting for leases. ASU 2016-02 introduces a lessee model that brings most leases onto the balance sheet. The new standard also aligns many of the underlying principles of the new lessor model with those in Accounting Standards Codification ("ASC") 606, the FASB's new revenue recognition standard (i.e., those related to evaluating when profit can be recognized). Furthermore, ASU 2016-02 addresses other concerns related to the current leases model. For example, ASU 2016-02 eliminates the current GAAP requirement for an entity to use bright-line tests in determining lease classification. ASU 2016-02 also requires lessors to increase the transparency of their exposure to changes in value of their residual assets and how they manage that exposure. ASU 2016-02 is effective for the Company for both interim annual periods beginning January 1, 2020. The Company is currently assessing the potential impact of the adoption of ASU 2016-02 on its consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes ("ASU 2015-17"), which requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in the condensed consolidated balance sheet. Netting of deferred tax assets and deferred tax liabilities is still required under ASU 2015-17. The ASU is effective for the Company for its annual report of the year ending December 31, 2018 and for interim period reporting beginning January 1, 2019, with early adoption permitted. The Company elected to early-adopt ASU 2015-17 prospectively and accordingly, reclassified its net current deferred tax asset totaling $1.0 million to its noncurrent net deferred tax asset as of December 31, 2015. No prior periods were retrospectively adjusted. The early adoption of ASU 2015-17 did not have a material impact on the Company's consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, Simplifying the Accounting for Measurement-Period Adjustments ("ASU 2015-16"), which eliminates the requirement to restate prior periods to reflect adjustments made to provisional amounts recognized in a business combination. Under ASU 2015-16, an acquirer must recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined, rather than retrospectively, as had previously been required. ASU 2015-16 also requires acquirers to present separately on the face of the income statement, or disclose in the notes, the portion of the amount recorded in current period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. ASU 2015-16 was effective for the Company as of January 1, 2016. The adoption of ASU 2015-16 did not have a material impact on the Company's consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory ("ASU 2015-11"). ASU 2015-11 simplifies the measurement of inventory by requiring entities to measure most inventory at the lower of cost and net realizable value, replacing the previous requirement to measure most inventory at the lower of cost or market. ASU 2015-11 does not apply to inventories that are measured by using either the last-in, first-out method or the retail inventory method. ASU 2015-11 is effective for the Company for both interim and annual reporting periods beginning January 1, 2017. The adoption of ASU 2015-11 is not expected to have a material impact on the Company's consolidated financial statements. In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). ASU 2014-15 provides guidelines for determining when and how to disclose going concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity's ability to continue as a going concern. ASU 2014-15 is effective for the Company for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The adoption of ASU 2014-15 is not expected to have a material impact on the Company's consolidated financial statements. In June 2014, the FASB issued ASU 2014-12, Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (“ASU 2014-12”). ASU 2014-12 clarifies that entities should treat performance targets that can be met after the requisite service period of a share-based payment award as performance conditions that affect vesting. Therefore, an entity would not record compensation expense (measured as of the grant date without taking into account the effect of the performance target) related to an award for which transfer to the employee is contingent on the entity’s satisfaction of a performance target until it becomes probable that the performance target will be met. ASU 2014-12 does not contain any new disclosure requirements. ASU 2014-12 was effective for the Company as of January 1, 2016. The adoption of ASU 2014-12 did not have a material impact on the Company's consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), its final standard on revenue from contracts with customers. ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying the revenue model to contracts within its scope, an entity identifies the contract(s) with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to the performance obligations in the contract and recognizes revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09 applies to all contracts with customers that are within the scope of other topics in the FASB ASC. Certain of ASU 2014-09’s provisions also apply to transfers of nonfinancial assets, including in-substance nonfinancial assets that are not an output of an entity’s ordinary activities (i.e., property, plant and equipment; real estate; or intangible assets). Existing accounting guidance applicable to these transfers has been amended or superseded. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date ("ASU 2015-14"), which defers the original effective date of interim and annual reporting periods by one year. As a result, public entities would not be required to apply the new revenue standard until annual reporting periods beginning after December 15, 2017. In March 2016, the FASB issued ASU 2016-08, Principal Versus Agent Considerations (Reporting Revenue Gross Versus Net) ("ASU 2016-08") to clarify certain aspects of the principal-versus-agent guidance in its new revenue recognition standard in response to feedback received from the FASB-IASB joint revenue recognition transition resource group. ASU 2016-08 clarifies the implementation guidance on principal-versus-agent considerations regarding how an entity determines whether it is a principal or an agent for each specified good or service promised to the customer and how an entity determines the nature of each specified good or service. ASU 2016-08 also provides clarification regarding the application of the principal-versus-agent guidance. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing ("ASU 2016-10"), which amends certain aspects of the guidance in ASU 2014-09 on identifying performance obligations, including immaterial promised goods or services, shipping and handling activities and identifying when promises represent performance obligations; and licensing implementation guidance, including determining the nature of an entity's promise in granting a license, sales-based and usage-based royalties, restrictions of time, geographical location and use, and renewals of licenses that provide a right to use IP. In May 2016, the FASB issued ASU 2016-11, R evenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815) ("ASU 2016-11"), which rescinds certain SEC guidance from the Codification in response to announcements made by the SEC staff at the Emerging Issues Task Force's March 3, 2016 meeting, and which supersedes certain SEC observer comments on the topics of revenue and expense recognition for freight services in process, accounting for shipping and handling fees and costs, accounting for consideration given by a vendor to a customer and accounting for gas-balancing arrangements upon the adoption of ASU 2014-09. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606) ("ASU 2016-12"), which amends certain aspects of ASU 2014-09, including regarding collectability, the presentation of sales tax and other similar taxes collected from customers, non-cash consideration, contract modifications and completed contracts at transition. ASU 2016-08, ASU 2016-10, ASU 2016-11 and ASU 2016-12 are effective at the same time as ASU 2014-09 (as amended by ASU 2015-14). The Company is currently assessing the potential impact of the adoption of these ASUs on its consolidated financial statements. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
BUSINESS ACQUISITIONS | BUSINESS ACQUISITION Treq Labs, Inc. On the Treq Asset Acquisition Date, the Company acquired from Treq the SDN Business. The SDN Business provides solutions that optimize networks for voice, video and UC for both enterprise and service provider customers. The Company believes that the acquisition of the SDN Business has helped the Company accelerate the delivery of its SDN strategy. In consideration for the acquisition of the SDN Business, Sonus paid $10.1 million in cash on the Treq Asset Acquisition Date, and an additional consideration payment of $750,000 on each of July 2, 2015 and January 4, 2016. The Company also entered into an Earn-Out Agreement, dated as of January 2, 2015, with Treq and Karl F. May, the seller representative in the transaction (the "Earn-Out Agreement"), under which the Company agreed to issue up to an aggregate of 1.3 million shares of common stock over a three -year period subsequent to the Treq Asset Acquisition Date if aggregate revenue thresholds of at least $60 million are achieved by the SDN Business during that period, and up to an aggregate of an additional 2.2 million shares ( 3.5 million shares in total) if aggregate revenue thresholds of at least $150 million are achieved by the SDN Business during that period. If the initial revenue thresholds are not met, no shares will be issued. Based on historical and forecasted sales, no incremental contingent consideration was recorded either initially as of the Treq Asset Acquisition Date or through June 30, 2016 . Any shares issued pursuant to the Earn-Out Agreement will be issued in reliance on the exemption from registration available under Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"), and will be subsequently registered for resale under the Securities Act by the Company. The transaction has been accounted for as a business combination. The Company finalized its valuation of the identifiable intangible assets in the second quarter of fiscal 2015. Based on the purchase price allocation, the Company recorded $1.0 million of goodwill, primarily due to expected synergies between the combined companies and expanded market opportunities. The goodwill is deductible for tax purposes. A summary of the purchase consideration for the SDN Business is as follows (in thousands): Fair value of consideration transferred: Cash, net of cash acquired $ 11,647 Fair value of assets acquired and liabilities assumed: Intangible assets: In-process research and development $ 9,100 Developed technology 1,500 Goodwill 1,047 $ 11,647 The valuation of the acquired intangible assets is inherently subjective and relies on significant unobservable inputs. The Company used an income approach to value the acquired in-process research and development and developed technology intangible assets. The valuation for each of these intangible assets was based on estimated projections of expected cash flows to be generated by the assets, discounted to the present value at discount rates commensurate with perceived risk. The valuation assumptions take into consideration the Company's estimates of technology attrition and revenue growth projections. During the three months ended March 31, 2016, the Company began to record amortization expense in connection with the in-process research and development intangible assets related to a product that became generally available in that quarter and accordingly, reclassified the asset with a cost basis of $1.6 million to its developed technology intangible assets. During the three months ended September 25, 2015, the Company began to record amortization expense in connection with certain of the in-process research and development intangible assets related to a product that became generally available in that quarter and accordingly, reclassified the asset with a cost basis of $7.5 million to its developed technology intangible assets. Accordingly, as of March 31, 2016, the Company no longer had an in-process research and development intangible asset. The Company is amortizing the identifiable intangible assets in relation to the expected cash flows from the individual intangible assets over their respective useful lives (see Note 6 ). The Company has not disclosed the amount of revenue or earnings of the SDN Business since the Treq Asset Acquisition Date or pro forma financial information, as these amounts are not significant to the Company's consolidated financial statements. Acquisition-Related Expenses Acquisition-related expenses include those expenses related to acquisitions that would otherwise not have been incurred by the Company. These expenses include professional and services fees, such as legal, audit, consulting, paying agent and other fees, as well as cash payments to certain employees of acquired companies in connection with change of control agreements. The amounts recorded in the three and six months ended June 26, 2015 relate to professional fees in connection with the acquisition of the SDN Business. The Company did not record acquisition-related expenses in either the three or six months ended June 30, 2016. The component of acquisition-related expenses included in the Company's results of operations for the three and six months ended June 26, 2015 is as follows (in thousands): Three months ended Six months ended June 26, June 26, Professional and services fees $ 24 $ 131 |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE | EARNINGS (LOSS) PER SHARE Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares outstanding during the period. For periods in which the Company reports net income, diluted net income per share is determined by using the weighted average number of common and dilutive common equivalent shares outstanding during the period unless the effect is antidilutive. The calculations of shares used to compute basic and diluted loss per share are as follows (in thousands): Three months ended Six months ended June 30, June 26, June 30, June 26, Weighted average shares outstanding—basic 49,423 49,484 49,453 49,454 Potential dilutive common shares — — — — Weighted average shares outstanding—diluted 49,423 49,484 49,453 49,454 Options to purchase the Company's common stock, unvested shares of restricted stock, unvested shares of performance-based stock and shares in connection with future purchases under the Company's Amended and Restated 2000 Employee Stock Purchase Plan, as amended (the "ESPP"), totaling 8.7 million shares for the three and six months ended June 30, 2016 and 8.9 million shares for the three and six months ended June 26, 2015 have not been included in the computation of diluted loss per share because their effect would have been antidilutive. |
CASH EQUIVALENTS AND INVESTMENT
CASH EQUIVALENTS AND INVESTMENTS | 6 Months Ended |
Jun. 30, 2016 | |
Investments, All Other Investments [Abstract] | |
CASH EQUIVALENTS, MARKETABLE SECURITIES AND INVESTMENTS | CASH EQUIVALENTS AND INVESTMENTS The Company invests in debt instruments, primarily U.S. government-backed, municipal and corporate obligations, which management believes to be high quality (investment grade) credit instruments. During the three months ended March 31, 2016, the Company sold $3.8 million of its available-for-sale securities and recognized gross losses aggregating $18,000 , which are included as a component of Other income (expense), net, in the Company's condensed consolidated statement of operations for the six months ended June 30, 2016. The Company did not realize any gross gains on these sales. The Company did not sell any of its available-for-sale securities during the three months ended June 30, 2016 or during the three or six months ended June 26, 2015. Investments with continuous unrealized losses for one year or greater at June 30, 2016 were nominal. Since the Company currently does not intend to sell these securities and does not believe it will be required to sell any securities before they recover in value, it does not believe these declines are other-than-temporary. On a quarterly basis, the Company reviews its marketable securities and investments to determine if there have been any events that could create a credit impairment. Based on its reviews, the Company does not believe that any impairment existed with its current holdings at June 30, 2016 . The amortized cost, gross unrealized gains and losses and fair value of the Company's marketable debt securities and investments at June 30, 2016 and December 31, 2015 were comprised of the following (in thousands): June 30, 2016 Amortized cost Unrealized gains Unrealized losses Fair value Cash equivalents $ 4,097 $ — $ — $ 4,097 Marketable securities Municipal obligations $ 4,804 $ 8 $ — $ 4,812 U.S. government agency notes 8,476 11 — 8,487 Corporate debt securities 39,193 23 (10 ) 39,206 $ 52,473 $ 42 $ (10 ) $ 52,505 Investments Municipal obligations $ 1,114 $ 4 $ — $ 1,118 U.S. government agency notes 26,949 52 (2 ) 26,999 Corporate debt securities 25,778 49 (2 ) 25,825 $ 53,841 $ 105 $ (4 ) $ 53,942 December 31, 2015 Amortized cost Unrealized gains Unrealized losses Fair value Cash equivalents $ 7,122 $ — $ — $ 7,122 Marketable securities Municipal obligations $ 3,910 $ — $ (1 ) $ 3,909 U.S. government agency notes 3,450 — (2 ) 3,448 Corporate debt securities 46,736 2 (56 ) 46,682 Commercial paper 3,994 — — 3,994 Certificates of deposit 500 — — 500 $ 58,590 $ 2 $ (59 ) $ 58,533 Investments Municipal obligations $ 2,165 $ — $ (4 ) $ 2,161 U.S. government agency notes 1,999 — (13 ) 1,986 Corporate debt securities 29,541 2 (85 ) 29,458 $ 33,705 $ 2 $ (102 ) $ 33,605 The Company's available-for-sale debt securities classified as Investments in the condensed consolidated balance sheets at June 30, 2016 and December 31, 2015 had maturity dates after one year but within approximately two years or less from the balance sheet date. Fair Value Hierarchy Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. The three-tier fair value hierarchy is based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is as follows: Level 1. Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2. Level 2 applies to assets or liabilities for which there are inputs that are directly or indirectly observable in the marketplace, such as quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets). Level 3. Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The following table shows the fair value of the Company's financial assets at June 30, 2016 and December 31, 2015 . These financial assets are comprised of the Company's available-for-sale debt securities and reported under the captions Cash and cash equivalents, Marketable securities and Investments in the condensed consolidated balance sheets (in thousands): Fair value measurements at Total carrying Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Cash equivalents $ 4,097 $ 4,097 $ — $ — Marketable securities Municipal obligations $ 4,812 $ — $ 4,812 $ — U.S. government agency notes 8,487 — 8,487 — Corporate debt securities 39,206 — 39,206 — $ 52,505 $ — $ 52,505 $ — Investments Municipal obligations $ 1,118 $ — $ 1,118 $ — U.S. government agency notes 26,999 — 26,999 — Corporate debt securities 25,825 — 25,825 — $ 53,942 $ — $ 53,942 $ — Fair value measurements at Total carrying Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Cash equivalents $ 7,122 $ 7,122 $ — $ — Marketable securities Municipal obligations $ 3,909 $ — $ 3,909 $ — U.S. government agency notes 3,448 — 3,448 — Corporate debt securities 46,682 — 46,682 — Commercial paper 3,994 — 3,994 — Certificates of deposit 500 — 500 — $ 58,533 $ — $ 58,533 $ — Investments Municipal obligations $ 2,161 $ — $ 2,161 $ — U.S. government agency notes 1,986 — 1,986 — Corporate debt securities 29,458 — 29,458 — $ 33,605 $ — $ 33,605 $ — The Company's marketable securities and investments have been valued with the assistance of valuations provided by third-party pricing services, as derived from such services' pricing models. Inputs to the models may include, but are not limited to, reported trades, executable bid and asked prices, broker/dealer quotations, prices or yields of securities with similar characteristics, benchmark curves or information pertaining to the issuer, as well as industry and economic events. The pricing services may use a matrix approach, which considers information regarding securities with similar characteristics to determine the valuation for a security. The Company is ultimately responsible for the condensed consolidated financial statements and underlying estimates. Accordingly, the Company assesses the reasonableness of the valuations provided by the third-party pricing services by reviewing actual trade data, broker/dealer quotes and other similar data, which are obtained from quoted market prices or other sources. |
INVENTORY
INVENTORY | 6 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY Inventory at June 30, 2016 and December 31, 2015 consists of the following (in thousands): June 30, December 31, On-hand final assemblies and finished goods inventories $ 17,416 $ 17,136 Deferred cost of goods sold 4,858 5,975 22,274 23,111 Less current portion (20,674 ) (23,111 ) Noncurrent portion (included in Other assets) $ 1,600 $ — |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | INTANGIBLE ASSETS AND GOODWILL The Company's intangible assets at June 30, 2016 and December 31, 2015 consist of the following (dollars in thousands): June 30, 2016 Weighted average amortization period (years) Cost Accumulated amortization Net carrying value Developed technology 6.45 $ 32,880 $ 13,497 $ 19,383 Customer relationships 5.57 10,030 7,045 2,985 Internal use software 3.00 730 730 — 6.19 $ 43,640 $ 21,272 $ 22,368 December 31, 2015 Weighted average amortization period (years) Cost Accumulated amortization Net carrying value In-process research and development * $ 1,600 $ — $ 1,600 Developed technology 6.42 31,280 10,415 20,865 Customer relationships 5.57 10,030 6,408 3,622 Internal use software 3.00 730 730 — 6.19 $ 43,640 $ 17,553 $ 26,087 ________________ * An in-process research and development intangible asset has an indefinite life until the product is generally available, at which time such asset is reclassified to developed technology. As of June 30, 2016, all of the Company's in-process research and development intangible assets had been reclassified to developed technology and are being amortized over their respective estimated useful lives. Amortization expense for intangible assets for the three and six months ended June 30, 2016 and June 26, 2015 was as follows (in thousands): Three months ended Six months ended Statement of operations classification June 30, June 26, June 30, June 26, Developed technology $ 1,455 $ 1,116 $ 3,082 $ 2,223 Cost of revenue - product Customer relationships 318 415 637 894 Sales and marketing Internal use software — 60 — 121 Cost of revenue - product $ 1,773 $ 1,591 $ 3,719 $ 3,238 The Company is recording amortization expense in connection with the in-process research and development intangible assets that arose from the acquisition of the SDN Business, of which $1.6 million had been reclassified to developed technology in the three months ended March 31, 2016 and $7.5 million had been reclassified to developed technology in the three months ended September 25, 2015, representing the cost basis of products that became generally available in the respective quarters. The Company has determined that the reclassified assets each have an estimated useful life of 7 years . The Company is amortizing the identifiable intangible assets in relation to the expected cash flows from the individual intangible assets over their respective useful lives. Estimated future amortization expense for the Company's intangible assets at June 30, 2016 is as follows (in thousands): Years ending December 31, Remainder of 2016 $ 3,548 2017 7,265 2018 4,596 2019 3,571 2020 2,070 Thereafter 1,318 $ 22,368 There were no changes in the carrying value of the Company's goodwill in the six months ended June 30, 2016 . The balance of the Company's goodwill at June 30, 2016 is comprised of the following (in thousands): Balance at June 30, 2016 Goodwill $ 43,416 Accumulated impairment losses (3,106 ) $ 40,310 The changes in the carrying value of the Company's goodwill in the six months ended June 26, 2015 were as follows (in thousands): Balance at January 1, 2015 Goodwill $ 42,369 Accumulated impairment losses (3,106 ) 39,263 Acquisition of SDN Business 1,047 Balance at June 26, 2015 $ 40,310 Balance at June 26, 2015 Goodwill $ 43,416 Accumulated impairment losses (3,106 ) $ 40,310 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 6 Months Ended |
Jun. 30, 2016 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | ACCRUED EXPENSES Accrued expenses at June 30, 2016 and December 31, 2015 consist of the following (in thousands): June 30, December 31, Employee compensation and related costs $ 12,651 $ 22,180 Other 8,298 9,783 $ 20,949 $ 31,963 |
RESTRUCTURING ACCRUAL
RESTRUCTURING ACCRUAL | 6 Months Ended |
Jun. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING ACCRUAL | RESTRUCTURING ACCRUAL To better align the Company's cost structure to its current revenue expectations, in April 2015, the Company announced a cost reduction review and restructuring initiative (the "2015 Restructuring Initiative"). A summary of the 2015 Restructuring Initiative accrual activity for the six months ended June 30, 2016 is as follows (in thousands): Balance at Initiatives Adjustments for changes in estimate Cash Balance at Severance $ 749 $ — $ — $ (649 ) $ 100 The Company expects that the remaining amounts accrued under the 2015 Restructuring Initiative will be paid by the end of 2016. At both June 30, 2016 and December 31, 2015 , all of the restructuring accrual was included in Accrued expenses, as there was no long-term portion. |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT The Company entered into a credit agreement by and among the Company, as Borrower, Bank of America, N.A. ("Bank of America"), as Administrative Agent, Swing Line Lender and L/C Issuer, and the other lenders from time to time party thereto on June 27, 2014 (the "Credit Agreement"), which agreement was amended by a First Amendment to Credit Agreement on June 26, 2015 (the "First Amendment") and further amended by a Second Amendment to Credit Agreement on June 13, 2016 (the "Second Amendment" and collectively with the Credit Agreement and the First Amendment, the "Amended Credit Agreement"). Certain terms of the Credit Agreement have been amended by the Second Amendment, including, among other things: (i) an increase of the commitments from $15 million to $20 million ; (ii) an extension of the maturity date from June 30, 2016 to June 30, 2017; (iii) a reduction to the aggregate amount of cash and cash equivalents that the Loan Parties (as defined below) are required to hold at any time from $85 million to $50 million ; and (iv) a reduction of the commitment fee on the unused commitments available for borrowing from 0.15% to 0.1125% . The Amended Credit Agreement provides that the Company may select the interest rates under the credit facility from among the following options: (i) the Eurodollar Rate (which is defined as the rate per annum equal to the London Interbank Offered Rate plus 1.5% per annum) for a Eurodollar Rate Loan; and (ii) the highest of (a) the Federal Funds Rate plus 1/2 of 1% , (b) the rate of interest in effect on the borrowing date as publicly announced from time to time by Bank of America as its prime rate, and (c) the monthly Eurodollar Rate plus 1% . The obligations of the Company under the Amended Credit Agreement are guaranteed by Sonus International, Inc., Sonus Federal, Inc. and Network Equipment Technologies, Inc. ("NET") (collectively with the Company, the "Loan Parties") pursuant to a Master Continuing Guaranty and are secured by the assets of the Loan Parties pursuant to a Security and Pledge Agreement. The Amended Credit Agreement contains affirmative, negative and financial covenants customary for financings of this type. The negative covenants include limitations on liens, indebtedness, fundamental changes, dispositions, restricted payments, investments, transactions with affiliates, certain restrictive agreements and compliance with sanctions laws and regulations. The total revenues of the Loan Parties cannot be less than an aggregate of $50 million as of the last day of the Loan Parties' fiscal quarter, computed on a fiscal quarterly basis beginning with the fiscal quarter ended September 25, 2015. The credit facility will become due on June 30, 2017, subject to acceleration upon certain specified events of default, including, without limitation, payment defaults, defaults in the performance of affirmative and negative covenants, the inaccuracy of representations of warranties, bankruptcy and insolvency-related defaults, defaults relating to judgments, an ERISA Event (as defined in the Amended Credit Agreement), the failure to pay specified indebtedness and a change of control default. The Company did not have any amounts outstanding under the Amended Credit Agreement at either December 31, 2015 or June 30, 2016 . |
COMMON STOCK REPURCHASES AND UN
COMMON STOCK REPURCHASES AND UNDERWRITTEN OFFERING (Notes) | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
COMMON STOCK REPURCHASES AND UNDERWRITTEN OFFERING | COMMON STOCK REPURCHASES On July 29, 2013, the Company announced that its Board of Directors had authorized a stock buyback program to repurchase up to $100 million of the Company's common stock from time to time on the open market or in privately negotiated transactions. The timing and amount of any shares repurchased will be determined by the Company's management based on its evaluation of market conditions and other factors. The Company may elect to implement a 10b5-1 repurchase program, which would permit shares to be repurchased when the Company might otherwise be precluded from doing so under insider trading laws. The Company has not implemented such a 10b5-1 repurchase program to date. The stock buyback program may be suspended or discontinued at any time. The stock buyback program is being funded using the Company's working capital. During the six months ended June 30, 2016 , the Company spent $5.0 million , including transaction fees, to repurchase and retire 0.6 million shares of its common stock under the stock buyback program. During the six months ended June 26, 2015 , the Company spent $6.1 million , including transaction fees, to repurchase and retire 0.4 million shares of its common stock under the stock buyback program. At June 30, 2016 , the Company had $10.0 million remaining under the stock buyback program for future repurchases. |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION PLANS | STOCK-BASED COMPENSATION PLANS Stock Incentive Plan The Company's 2007 Stock Incentive Plan, as amended (the "2007 Plan"), provides for the award of options to purchase the Company's common stock ("stock options"), stock appreciation rights ("SARs"), restricted common stock awards ("RSAs"), restricted common stock units ("RSUs"), performance-based stock awards ("PSAs"), performance-based stock units ("PSUs") and other stock-based awards to employees, officers, directors (including those directors who are not employees or officers of the Company), consultants and advisors of the Company and its subsidiaries. At its 2016 annual meeting of stockholders held on June 9, 2016 (the "2016 Annual Meeting"), the Company's stockholders approved (i) changing the name of the 2007 Plan to the Amended and Restated Stock Incentive Plan (the "Stock Plan") and (ii) other amendments to the Stock Plan including, among other things, to: • Increase the number of shares of the Company's common stock authorized for issuance under the Stock Plan by 800,000 shares; • Extend the Stock Plan's termination date through the tenth anniversary of the 2016 Annual Meeting; • Revise the rate at which RSAs, RSUs, PSAs and PSUs (collectively, full value awards) are counted against the shares of common stock available for issuance under the Stock Plan from 1.61 shares for every one share subject to such award to 1.50 shares for every one share subject to such award. Shares of common stock subject to full value awards that were granted under any prior ratio that applied at the time such awards were granted will continue to return to the Stock Plan upon forfeiture of such awards at the respective previous ratio of 1.50 , 1.57 and 1.61 , as applicable; • Increase the maximum number of shares of the Company's common stock with respect to which awards may be granted to any participant under the Stock Plan to 1,000,000 shares per calendar year; • Increase the maximum number of shares of the Company's common stock with respect to which awards may be granted under the Stock Plan to any director who is not an employee of the Company at the time of grant to 100,000 shares per calendar year; and • Prohibit stock options and SARs granted under the Stock Plan from (i) providing for the payment or accrual of dividend equivalents or (ii) containing any provision entitling the grantee to the automatic grant of additional stock options or SARs, as applicable, in connection with the exercise of the original stock option or SAR, as applicable. In June 2016, the Compensation Committee of the Company's Board of Directors (the "Compensation Committee") voted to change the standard vesting terms for awards of stock options, RSAs and RSUs granted after June 9, 2016 as follows: • Stock options will generally vest over a period of three years , with one-third of the stock options vesting on the first anniversary of the grant date and the remaining two-thirds vesting in equal monthly increments thereafter through the third anniversary of the grant date. • RSAs and RSUs (collectively, the "restricted stock grants") will generally vest over a period of three years , with one-third of the shares underlying the grant vesting on the first anniversary of the grant date an the remaining two-thirds vesting in equal increments semi-annually through the third anniversary of the grant date. The Company neither adjusted nor intends to adjust the vesting schedules of stock options or restricted stock grants awarded prior to June 9, 2016 to reflect the new three-year vesting schedules. Executive Equity Arrangements On April 1, 2016, the Company granted an aggregate of 131,250 PSUs with both market and service conditions to six of its executives (the "2016 PSUs"). The terms of the 2016 PSUs are such that up to one-third of the shares subject to the 2016 PSUs will vest on each of the first, second and third anniversaries of the date of grant (collectively, the "2016 PSU Vesting Dates") to the extent of achievement of the Company's total shareholder return ("TSR") compared to the TSR of the companies included in the NASDAQ Telecommunications Index for the same fiscal year, measured by the Compensation Committee after each of the 2016, 2017 and 2018 fiscal years, respectively (as used in this paragraph, each, a "Performance Period"). The shares determined to be earned will vest on the anniversary of the grant date following each Performance Period. Shares subject to the 2016 PSUs that fail to be earned will be forfeited. The 2016 PSUs include a market condition that requires the use of a Monte Carlo simulation approach to model future stock price movements based upon the risk-free rate of return, the volatility of each entity, and the pair-wise covariance between each entity. These results were then used to calculate the grant date fair values of the 2016 PSUs. Because the 2016 PSUs have market conditions, the Company is required to record expense for the 2016 PSUs through the final 2016 PSU Vesting Date of April 1, 2019, regardless of the number of shares that are ultimately earned. In June 2016, one executive separated from the Company and forfeited his unvested 2016 PSUs; these forfeited unvested 2016 PSUs are reported as such in the performance-based units table below. On March 16, 2015, the Company granted an aggregate of 131,250 PSUs with both market and service conditions to eight of its executives (the "2015 PSUs"). In 2015, subsequent to the grant date, two executives separated from the Company and, in accordance with their respective employment agreements with the Company, the Company accelerated the vesting of certain unvested 2015 PSUs. The terms of the 2015 PSUs are such that up to one-third of the shares subject to the 2015 PSUs will vest on each of the first, second and third anniversaries of the date of grant (collectively, the "2015 PSU Vesting Dates") to the extent of achievement of the Company's TSR compared to the TSR of the companies included in the NASDAQ Telecommunications Index for the same Performance Period, measured by the Compensation Committee at the end of each of the 2015, 2016 and 2017 fiscal years, respectively (as used in this paragraph, each, a "Performance Period"). The shares determined to be earned will vest on the anniversary of the grant date following each Performance Period. Shares subject to the 2015 PSUs that fail to be earned will be forfeited. The 2015 PSUs include a market condition that required the use of a Monte Carlo simulation approach to calculate the grant date fair values of the 2015 PSUs. Because the 2015 PSUs have market conditions, the Company is required to record expense for the 2015 PSUs through the final 2015 PSU Vesting Date of March 16, 2018, regardless of the number of shares that are ultimately earned, if any. In February 2016, the Compensation Committee determined that the performance metrics for the 2015 PSUs were not achieved for the 2015 Performance Period. Accordingly, 37,081 shares in the aggregate, representing one-third of the 2015 PSUs held by the then-remaining six executives, were forfeited, and are reported as such in the performance-based units table below. In June 2016, one executive separated from the Company and forfeited his unvested 2015 PSUs; these forfeited unvested 2015 PSUs are reported as such in the performance-based units table below. Stock Options The activity related to the Company's outstanding stock options during the six months ended June 30, 2016 is as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at January 1, 2016 6,352,208 $ 15.99 Granted 129,510 $ 8.30 Exercised (3,224 ) $ 4.35 Forfeited (122,794 ) $ 15.52 Expired (244,445 ) $ 18.40 Outstanding at June 30, 2016 6,111,255 $ 15.74 5.68 $ 492 Vested or expected to vest at June 30, 2016 5,978,629 $ 15.78 5.62 $ 457 Exercisable at June 30, 2016 4,739,687 $ 15.80 5.05 $ 337 The grant date fair values of options to purchase common stock granted in the three and six months ended June 30, 2016 were estimated using the Black-Scholes valuation model with the following assumptions: Three months ended Six months ended June 30, June 30, Risk-free interest rate 1.00% - 1.60% 1.00% - 1.60% Expected dividends — — Weighted average volatility 56.4% 55.6% Expected life (years) 5.0 - 10.0 5.0 - 10.0 Additional information regarding the Company's stock options for the three and six months ended June 30, 2016 is as follows: Three months ended Six months ended June 30, June 30, Weighted average grant date fair value of stock options granted $ 4.88 $ 4.58 Total intrinsic value of stock options exercised (in thousands) $ 7 $ 11 Cash received from the exercise of stock options (in thousands) $ 10 $ 15 Restricted Stock Awards and Units The activity related to the Company's RSAs for the six months ended June 30, 2016 is as follows: Shares Weighted Average Grant Date Fair Value Unvested balance at January 1, 2016 1,512,783 $ 13.48 Granted 1,440,902 $ 7.73 Vested (496,814 ) $ 12.62 Forfeited (280,597 ) $ 10.30 Unvested balance at June 30, 2016 2,176,274 $ 10.28 The activity related to the Company's RSUs for the six months ended June 30, 2016 is as follows: Shares Weighted Average Grant Date Fair Value Unvested balance at January 1, 2016 95,361 $ 16.05 Granted 53,400 $ 7.58 Vested (22,035 ) $ 16.05 Forfeited (2,425 ) $ 16.05 Unvested balance at June 30, 2016 124,301 $ 12.41 The total fair value of shares of restricted stock granted under RSAs and RSUs that vested during the six months ended June 30, 2016 was $6.6 million . Performance-Based Stock Units The activity related to the Company's PSUs for the six months ended June 30, 2016 is as follows: Shares Weighted Average Grant Date Fair Value Unvested balance at January 1, 2016 111,250 $ 14.68 Granted 131,250 $ 10.25 Vested — $ — Forfeited (66,665 ) $ 12.77 Unvested balance at June 30, 2016 175,835 $ 12.10 Employee Stock Purchase Plan The Company's ESPP provides for six -month offering periods with the purchase price of the stock equal to 85% of the lesser of the market price on the first or last day of the offering period. The maximum number of shares of common stock an employee may purchase during each offering period is 500 , subject to certain adjustments pursuant to the ESPP. S tock-Based Compensation The condensed consolidated statements of operations include stock-based compensation for the three and six months ended June 30, 2016 and June 26, 2015 as follows (in thousands): Three months ended Six months ended June 30, June 26, June 30, June 26, Product cost of revenue $ 93 $ 83 $ 164 $ 157 Service cost of revenue 322 397 654 777 Research and development 1,210 1,445 2,389 2,803 Sales and marketing 1,224 1,852 2,244 2,868 General and administrative 1,792 3,032 3,605 5,024 $ 4,641 $ 6,809 $ 9,056 $ 11,629 There is no income tax benefit for employee stock-based compensation expense for the six months ended June 30, 2016 or June 26, 2015 due to the valuation allowance recorded. At June 30, 2016 , there was $28.8 million , net of expected forfeitures, of unrecognized stock-based compensation expense related to unvested stock options, awards, units and ESPP shares. This expense is expected to be recognized over a weighted average period of approximately two years . |
MAJOR CUSTOMERS
MAJOR CUSTOMERS | 6 Months Ended |
Jun. 30, 2016 | |
Risks and Uncertainties [Abstract] | |
MAJOR CUSTOMERS | MAJOR CUSTOMERS The following customers contributed 10% or more of the Company's revenue in at least one of the three or six month periods ended June 30, 2016 and June 26, 2015 : Three months ended Six months ended June 30, June 26, June 30, June 26, AT&T Inc. 16% 19% 14% 13% Verizon Communications Inc. 13% * * * Level 3 Communications * * 11% * _______________________ * Represents less than 10% of revenue At June 30, 2016 , one customer accounted for 10% or more of the Company's accounts receivable balance, representing approximately 21% of the Company's accounts receivable balance. At December 31, 2015 , one customer accounted for 10% or more of the Company's accounts receivable balance, representing approximately 11% of the Company's accounts receivable balance. The Company performs ongoing credit evaluations of its customers and generally does not require collateral on accounts receivable. The Company maintains an allowance for doubtful accounts and such losses have been within management's expectations. |
GEOGRAPHIC INFORMATION
GEOGRAPHIC INFORMATION | 6 Months Ended |
Jun. 30, 2016 | |
Segment Reporting [Abstract] | |
GEOGRAPHIC INFORMATION | GEOGRAPHIC INFORMATION The Company's classification of revenue by geographic area is determined by the location to which the product is shipped or where the services are performed. The following table summarizes revenue by geographic area as a percentage of total revenue: Three months ended Six months ended June 30, June 26, June 30, June 26, United States 70 % 71 % 69 % 67 % Europe, Middle East and Africa 13 12 13 13 Japan 8 9 11 13 Other Asia Pacific 6 4 5 4 Other 3 4 2 3 100 % 100 % 100 % 100 % International revenue, both as a percentage of total revenue and absolute dollars, may vary from one period to the next, and accordingly, historical data may not be indicative of future periods. |
RELATED PARTY
RELATED PARTY | 6 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTY | RELATED PARTY H. Brian Thompson, who was an independent member of the Company's Board of Directors until the Company's 2016 Annual Meeting, is the Executive Chairman of GTT Communications, Inc., a leading global cloud networking provider to multinational clients ("GTT"). Howard Janzen is an independent member of the Company's Board of Directors and also serves as an independent director of GTT. In October 2015, GTT completed the acquisition of One Source Networks Inc., a provider of global data, Internet, SIP trunking and managed services ("One Source"). One Source is a customer of the Company. The Company had a well-established and ongoing business relationship with One Source prior to its acquisition by GTT. The Company did no t recognize any revenue from One Source in the three months ended June 30, 2016, and recognized revenue aggregating approximately $23,000 from One Source in the six months ended June 30, 2016, pursuant to the terms of a contract between the parties, effective June 28, 2010. The Company believes the terms of this contract are consistent with third-party arrangements that provide similar services. Since Mr. Thompson is no longer a member of the Company's Board of Directors, as of June 30, 2016 the Company's relationship with GTT will no longer trigger a related party transaction unless and until any of the Company's directors, executive officers or holders of 5% or more of any class of its capital stock or any member of their immediate family has a direct or indirect material interest in a transaction between the Company and GTT in which the amount involved exceeds or will exceed $120,000 . As a matter of corporate governance policy and practice, related party transactions are presented and considered by the Audit Committee of the Company's Board of Directors in accordance with the Company's Related Person Transaction Policy. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company's income tax provisions for the six months ended June 30, 2016 and June 26, 2015 reflect the Company's estimates of the effective rates expected to be applicable for the respective full years, adjusted for any discrete events, which are recorded in the period that they occur. These estimates are reevaluated each quarter based on the Company's estimated tax expense for the full year. The estimated effective rates for the six months ended June 30, 2016 and June 26, 2015 do not include any benefit for the Company's domestic losses, as the Company has concluded that a valuation allowance on any domestic benefit is required. Included in the Company's provision for the six months ended June 30, 2016 is a discrete charge of $0.7 million related to an uncertain tax position of the Company's subsidiary in France. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES On April 6, 2015, Ming Huang, a purported shareholder of the Company, filed a Class Action Complaint (Civil Action No. 3:15-02407), alleging violations of the federal securities laws (the "Complaint") in the United States District Court for the District of New Jersey (the "District of New Jersey"), against the Company and two of its officers, Raymond P. Dolan, the Company's President and Chief Executive Officer, and Mark T. Greenquist, the Company's former Chief Financial Officer (collectively, the "Defendants"). On September 21, 2015, in response to motions subsequently filed with the District of New Jersey by four other purported shareholders of the Company seeking status as lead plaintiff, the District of New Jersey appointed Richard Sousa as lead plaintiff (the "Plaintiff"). The Plaintiff claims to represent purchasers of the Company's common stock during the period from October 23, 2014 to March 24, 2015, and seeks unspecified damages. The principal allegation contained in the Complaint is that the Defendants made misleading forward-looking statements concerning the Company's fiscal first quarter of 2015 financial performance. On September 22, 2015, the Company filed a Motion to Transfer (the “Motion to Transfer”) this case to the United States District Court for the District of Massachusetts. The Plaintiff filed his opposition to the Motion to Transfer on October 5, 2015, and the Company filed a reply to the Motion to Transfer on October 13, 2015. On March 21, 2016, the District of New Jersey granted the Company's Motion to Transfer. Thus, this case will now be litigated in the United States District Court for the District of Massachusetts (Civil Action No. 1:16-cv-10657-GAO). On May 4, 2016, the Plaintiff filed an amended complaint (the "Amended Complaint"), which is now the operative complaint in this litigation. On June 20, 2016, the Company and the other Defendants filed a Motion to Dismiss the Amended Complaint (the "Motion to Dismiss") and on July 25, 2016, the Plaintiff filed an opposition to the Motion to Dismiss. The Company has until August 15, 2016 to file a reply to the Plaintiff's opposition to the Motion to Dismiss. The Company believes that the Defendants have meritorious defenses to the allegations made in the Amended Complaint and does not expect the results of this suit to have a material effect on its business or consolidated financial statements. In addition, the Company is often a party to disputes and legal proceedings that it considers routine and incidental to its business. Management does not expect the results of any of these actions to have a material effect on the Company's business or consolidated financial statements. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On July 27, 2016, the Company announced a restructuring program to further accelerate its investment in new technologies as the communications industry migrates to a Cloud-based architecture. The Company expects to record between $3 million and $4 million of restructuring expense over the next twelve months in connection with this action, resulting in expected annual savings of approximately $6 million to $8 million . The Company intends to utilize the entire savings to shift headcount towards new strategic initiatives (e.g., new products, expanded go-to-market footprint in selected geographies and discrete vertical markets). |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting only of normal recurring items, necessary for their fair presentation with accounting principles generally accepted in the United States of America ("GAAP") and with the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). Interim results are not necessarily indicative of results for a full year or any future interim period. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2015 (the "Annual Report"), which was filed with the SEC on February 23, 2016. For the year ended December 31, 2015, the Company reported its first, second and third quarters on a 4-4-5 basis, with the quarter ending on the Friday closest to the last day of each third month. Accordingly, the Company's first quarter ended on March 27, 2015, the second quarter ended on June 26, 2015 and the third quarter ended on September 25, 2015. Effective January 1, 2016, the Company is reporting its first, second and third quarters on a month-end basis, such that the first quarter ended on March 31, 2016, the second quarter ended on June 30, 2016 and the third quarter will end on September 30, 2016. The Company's fiscal year will continue to end on December 31. During the preparation of the Company's consolidated financial statements for the three-month period ended June 26, 2015, the Company identified an error related to the historical foreign translation of depreciation expense on certain foreign fixed assets that resulted in a historical understatement of expense in prior fiscal years totaling $1.4 million on a cumulative basis. There is no tax effect on these expenses as the amounts were calculated in the appropriate foreign currencies. The Company does not believe this error is material to its previously issued historical consolidated financial statements for any of the periods impacted and accordingly, has not adjusted its historical financial statements. The Company recorded the cumulative impact of the adjustment in the three months ended June 26, 2015. This adjustment resulted in a one-time $1.4 million overstatement of depreciation expense. The Company does not believe this adjustment is material to its condensed consolidated financial statements for the periods presented. On January 2, 2015 (the "Treq Asset Acquisition Date"), the Company acquired from Treq Labs, Inc. ("Treq") certain assets related to Treq's business of designing, developing, marketing, selling, servicing and maintaining software-defined networking ("SDN") technology, SDN controller software and SDN management software (the "SDN Business"). The financial results of the SDN Business are included in the Company's condensed consolidated financial statements starting on the Treq Asset Acquisition Date. |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of Sonus and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates and Judgments | Use of Estimates and Judgments The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and judgments relied upon in preparing these consolidated financial statements include accounting for business combinations, revenue recognition for multiple element arrangements, inventory valuations, assumptions used to determine the fair value of stock-based compensation, intangible assets and goodwill valuations, including impairments, legal contingencies and recoverability of Sonus' net deferred tax assets and the related valuation allowances. Sonus regularly assesses these estimates and records changes in estimates in the period in which they become known. Sonus bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results could differ from those estimates. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of the Company's financial instruments, which include cash equivalents, marketable securities, investments, accounts receivable, accounts payable and other long-term liabilities, approximate their fair values. |
Operating Segments | Operating Segments The Company operates in a single segment. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker in making decisions regarding resource allocation and assessing performance. To date, the chief operating decision maker has made such decisions and assessed performance at the company level, as one segment. The Company's chief operating decision maker is its President and Chief Executive Officer. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instrument s ("ASU 2016-13"), which adds an impairment model that is based on expected losses rather than incurred losses. Under ASU 2016-13, an entity recognizes as an allowance its estimate of expected credit losses, which the FASB believes will result in more timely recognition of such losses. ASU 2016-13 is effective for the Company beginning January 1, 2020 for both interim and annual reporting periods, with early adoption permitted. The Company does not expect the adoption of ASU 2016-13 will have a material impact on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"), which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures and statutory tax withholding requirements, as well as classification in the statement of cash flows. ASU 2016-09 is effective for the Company beginning January 1, 2017 for both interim and annual reporting periods. The Company is currently assessing the potential impact of the adoption of ASU 2016-09 on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) Section A - Leases: Amendments to the FASB Accounting Standards Codification ("ASU 2016-02"), its new standard on accounting for leases. ASU 2016-02 introduces a lessee model that brings most leases onto the balance sheet. The new standard also aligns many of the underlying principles of the new lessor model with those in Accounting Standards Codification ("ASC") 606, the FASB's new revenue recognition standard (i.e., those related to evaluating when profit can be recognized). Furthermore, ASU 2016-02 addresses other concerns related to the current leases model. For example, ASU 2016-02 eliminates the current GAAP requirement for an entity to use bright-line tests in determining lease classification. ASU 2016-02 also requires lessors to increase the transparency of their exposure to changes in value of their residual assets and how they manage that exposure. ASU 2016-02 is effective for the Company for both interim annual periods beginning January 1, 2020. The Company is currently assessing the potential impact of the adoption of ASU 2016-02 on its consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes ("ASU 2015-17"), which requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in the condensed consolidated balance sheet. Netting of deferred tax assets and deferred tax liabilities is still required under ASU 2015-17. The ASU is effective for the Company for its annual report of the year ending December 31, 2018 and for interim period reporting beginning January 1, 2019, with early adoption permitted. The Company elected to early-adopt ASU 2015-17 prospectively and accordingly, reclassified its net current deferred tax asset totaling $1.0 million to its noncurrent net deferred tax asset as of December 31, 2015. No prior periods were retrospectively adjusted. The early adoption of ASU 2015-17 did not have a material impact on the Company's consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, Simplifying the Accounting for Measurement-Period Adjustments ("ASU 2015-16"), which eliminates the requirement to restate prior periods to reflect adjustments made to provisional amounts recognized in a business combination. Under ASU 2015-16, an acquirer must recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined, rather than retrospectively, as had previously been required. ASU 2015-16 also requires acquirers to present separately on the face of the income statement, or disclose in the notes, the portion of the amount recorded in current period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. ASU 2015-16 was effective for the Company as of January 1, 2016. The adoption of ASU 2015-16 did not have a material impact on the Company's consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory ("ASU 2015-11"). ASU 2015-11 simplifies the measurement of inventory by requiring entities to measure most inventory at the lower of cost and net realizable value, replacing the previous requirement to measure most inventory at the lower of cost or market. ASU 2015-11 does not apply to inventories that are measured by using either the last-in, first-out method or the retail inventory method. ASU 2015-11 is effective for the Company for both interim and annual reporting periods beginning January 1, 2017. The adoption of ASU 2015-11 is not expected to have a material impact on the Company's consolidated financial statements. In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). ASU 2014-15 provides guidelines for determining when and how to disclose going concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity's ability to continue as a going concern. ASU 2014-15 is effective for the Company for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The adoption of ASU 2014-15 is not expected to have a material impact on the Company's consolidated financial statements. In June 2014, the FASB issued ASU 2014-12, Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (“ASU 2014-12”). ASU 2014-12 clarifies that entities should treat performance targets that can be met after the requisite service period of a share-based payment award as performance conditions that affect vesting. Therefore, an entity would not record compensation expense (measured as of the grant date without taking into account the effect of the performance target) related to an award for which transfer to the employee is contingent on the entity’s satisfaction of a performance target until it becomes probable that the performance target will be met. ASU 2014-12 does not contain any new disclosure requirements. ASU 2014-12 was effective for the Company as of January 1, 2016. The adoption of ASU 2014-12 did not have a material impact on the Company's consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), its final standard on revenue from contracts with customers. ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying the revenue model to contracts within its scope, an entity identifies the contract(s) with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to the performance obligations in the contract and recognizes revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09 applies to all contracts with customers that are within the scope of other topics in the FASB ASC. Certain of ASU 2014-09’s provisions also apply to transfers of nonfinancial assets, including in-substance nonfinancial assets that are not an output of an entity’s ordinary activities (i.e., property, plant and equipment; real estate; or intangible assets). Existing accounting guidance applicable to these transfers has been amended or superseded. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date ("ASU 2015-14"), which defers the original effective date of interim and annual reporting periods by one year. As a result, public entities would not be required to apply the new revenue standard until annual reporting periods beginning after December 15, 2017. In March 2016, the FASB issued ASU 2016-08, Principal Versus Agent Considerations (Reporting Revenue Gross Versus Net) ("ASU 2016-08") to clarify certain aspects of the principal-versus-agent guidance in its new revenue recognition standard in response to feedback received from the FASB-IASB joint revenue recognition transition resource group. ASU 2016-08 clarifies the implementation guidance on principal-versus-agent considerations regarding how an entity determines whether it is a principal or an agent for each specified good or service promised to the customer and how an entity determines the nature of each specified good or service. ASU 2016-08 also provides clarification regarding the application of the principal-versus-agent guidance. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing ("ASU 2016-10"), which amends certain aspects of the guidance in ASU 2014-09 on identifying performance obligations, including immaterial promised goods or services, shipping and handling activities and identifying when promises represent performance obligations; and licensing implementation guidance, including determining the nature of an entity's promise in granting a license, sales-based and usage-based royalties, restrictions of time, geographical location and use, and renewals of licenses that provide a right to use IP. In May 2016, the FASB issued ASU 2016-11, R evenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815) ("ASU 2016-11"), which rescinds certain SEC guidance from the Codification in response to announcements made by the SEC staff at the Emerging Issues Task Force's March 3, 2016 meeting, and which supersedes certain SEC observer comments on the topics of revenue and expense recognition for freight services in process, accounting for shipping and handling fees and costs, accounting for consideration given by a vendor to a customer and accounting for gas-balancing arrangements upon the adoption of ASU 2014-09. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606) ("ASU 2016-12"), which amends certain aspects of ASU 2014-09, including regarding collectability, the presentation of sales tax and other similar taxes collected from customers, non-cash consideration, contract modifications and completed contracts at transition. ASU 2016-08, ASU 2016-10, ASU 2016-11 and ASU 2016-12 are effective at the same time as ASU 2014-09 (as amended by ASU 2015-14). The Company is currently assessing the potential impact of the adoption of these ASUs on its consolidated financial statements. |
BUSINESS ACQUISITIONS (Tables)
BUSINESS ACQUISITIONS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Summary of preliminary allocation of the purchase consideration | A summary of the purchase consideration for the SDN Business is as follows (in thousands): Fair value of consideration transferred: Cash, net of cash acquired $ 11,647 Fair value of assets acquired and liabilities assumed: Intangible assets: In-process research and development $ 9,100 Developed technology 1,500 Goodwill 1,047 $ 11,647 |
Schedule of Components of Acquisition Related Costs | The component of acquisition-related expenses included in the Company's results of operations for the three and six months ended June 26, 2015 is as follows (in thousands): Three months ended Six months ended June 26, June 26, Professional and services fees $ 24 $ 131 |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of calculations of shares used to compute basic and diluted earnings (loss) per share | The calculations of shares used to compute basic and diluted loss per share are as follows (in thousands): Three months ended Six months ended June 30, June 26, June 30, June 26, Weighted average shares outstanding—basic 49,423 49,484 49,453 49,454 Potential dilutive common shares — — — — Weighted average shares outstanding—diluted 49,423 49,484 49,453 49,454 |
CASH EQUIVALENTS AND INVESTME27
CASH EQUIVALENTS AND INVESTMENTS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Investments, All Other Investments [Abstract] | |
Schedule of amortized cost, gross unrealized gains and losses and fair value of marketable debt and equity securities and investments | The amortized cost, gross unrealized gains and losses and fair value of the Company's marketable debt securities and investments at June 30, 2016 and December 31, 2015 were comprised of the following (in thousands): June 30, 2016 Amortized cost Unrealized gains Unrealized losses Fair value Cash equivalents $ 4,097 $ — $ — $ 4,097 Marketable securities Municipal obligations $ 4,804 $ 8 $ — $ 4,812 U.S. government agency notes 8,476 11 — 8,487 Corporate debt securities 39,193 23 (10 ) 39,206 $ 52,473 $ 42 $ (10 ) $ 52,505 Investments Municipal obligations $ 1,114 $ 4 $ — $ 1,118 U.S. government agency notes 26,949 52 (2 ) 26,999 Corporate debt securities 25,778 49 (2 ) 25,825 $ 53,841 $ 105 $ (4 ) $ 53,942 December 31, 2015 Amortized cost Unrealized gains Unrealized losses Fair value Cash equivalents $ 7,122 $ — $ — $ 7,122 Marketable securities Municipal obligations $ 3,910 $ — $ (1 ) $ 3,909 U.S. government agency notes 3,450 — (2 ) 3,448 Corporate debt securities 46,736 2 (56 ) 46,682 Commercial paper 3,994 — — 3,994 Certificates of deposit 500 — — 500 $ 58,590 $ 2 $ (59 ) $ 58,533 Investments Municipal obligations $ 2,165 $ — $ (4 ) $ 2,161 U.S. government agency notes 1,999 — (13 ) 1,986 Corporate debt securities 29,541 2 (85 ) 29,458 $ 33,705 $ 2 $ (102 ) $ 33,605 |
Schedule of fair value of financial assets | The following table shows the fair value of the Company's financial assets at June 30, 2016 and December 31, 2015 . These financial assets are comprised of the Company's available-for-sale debt securities and reported under the captions Cash and cash equivalents, Marketable securities and Investments in the condensed consolidated balance sheets (in thousands): Fair value measurements at Total carrying Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Cash equivalents $ 4,097 $ 4,097 $ — $ — Marketable securities Municipal obligations $ 4,812 $ — $ 4,812 $ — U.S. government agency notes 8,487 — 8,487 — Corporate debt securities 39,206 — 39,206 — $ 52,505 $ — $ 52,505 $ — Investments Municipal obligations $ 1,118 $ — $ 1,118 $ — U.S. government agency notes 26,999 — 26,999 — Corporate debt securities 25,825 — 25,825 — $ 53,942 $ — $ 53,942 $ — Fair value measurements at Total carrying Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Cash equivalents $ 7,122 $ 7,122 $ — $ — Marketable securities Municipal obligations $ 3,909 $ — $ 3,909 $ — U.S. government agency notes 3,448 — 3,448 — Corporate debt securities 46,682 — 46,682 — Commercial paper 3,994 — 3,994 — Certificates of deposit 500 — 500 — $ 58,533 $ — $ 58,533 $ — Investments Municipal obligations $ 2,161 $ — $ 2,161 $ — U.S. government agency notes 1,986 — 1,986 — Corporate debt securities 29,458 — 29,458 — $ 33,605 $ — $ 33,605 $ — |
INVENTORY (Tables)
INVENTORY (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | Inventory at June 30, 2016 and December 31, 2015 consists of the following (in thousands): June 30, December 31, On-hand final assemblies and finished goods inventories $ 17,416 $ 17,136 Deferred cost of goods sold 4,858 5,975 22,274 23,111 Less current portion (20,674 ) (23,111 ) Noncurrent portion (included in Other assets) $ 1,600 $ — |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | The Company's intangible assets at June 30, 2016 and December 31, 2015 consist of the following (dollars in thousands): June 30, 2016 Weighted average amortization period (years) Cost Accumulated amortization Net carrying value Developed technology 6.45 $ 32,880 $ 13,497 $ 19,383 Customer relationships 5.57 10,030 7,045 2,985 Internal use software 3.00 730 730 — 6.19 $ 43,640 $ 21,272 $ 22,368 December 31, 2015 Weighted average amortization period (years) Cost Accumulated amortization Net carrying value In-process research and development * $ 1,600 $ — $ 1,600 Developed technology 6.42 31,280 10,415 20,865 Customer relationships 5.57 10,030 6,408 3,622 Internal use software 3.00 730 730 — 6.19 $ 43,640 $ 17,553 $ 26,087 |
Schedule of amortization expense related to intangible assets | Amortization expense for intangible assets for the three and six months ended June 30, 2016 and June 26, 2015 was as follows (in thousands): Three months ended Six months ended Statement of operations classification June 30, June 26, June 30, June 26, Developed technology $ 1,455 $ 1,116 $ 3,082 $ 2,223 Cost of revenue - product Customer relationships 318 415 637 894 Sales and marketing Internal use software — 60 — 121 Cost of revenue - product $ 1,773 $ 1,591 $ 3,719 $ 3,238 |
Schedule of estimated future amortization expense for intangible assets | Estimated future amortization expense for the Company's intangible assets at June 30, 2016 is as follows (in thousands): Years ending December 31, Remainder of 2016 $ 3,548 2017 7,265 2018 4,596 2019 3,571 2020 2,070 Thereafter 1,318 $ 22,368 |
Schedule of goodwill | in the six months ended June 30, 2016 . The balance of the Company's goodwill at June 30, 2016 is comprised of the following (in thousands): Balance at June 30, 2016 Goodwill $ 43,416 Accumulated impairment losses (3,106 ) $ 40,310 The changes in the carrying value of the Company's goodwill in the six months ended June 26, 2015 were as follows (in thousands): Balance at January 1, 2015 Goodwill $ 42,369 Accumulated impairment losses (3,106 ) 39,263 Acquisition of SDN Business 1,047 Balance at June 26, 2015 $ 40,310 Balance at June 26, 2015 Goodwill $ 43,416 Accumulated impairment losses (3,106 ) $ 40,310 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses | Accrued expenses at June 30, 2016 and December 31, 2015 consist of the following (in thousands): June 30, December 31, Employee compensation and related costs $ 12,651 $ 22,180 Other 8,298 9,783 $ 20,949 $ 31,963 |
RESTRUCTURING ACCRUAL (Tables)
RESTRUCTURING ACCRUAL (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Summary of restructuring accrual activity | Balance at Initiatives Adjustments for changes in estimate Cash Balance at Severance $ 749 $ — $ — $ (649 ) $ 100 The Company expects that the remaining amounts accrued under the 2015 Restructuring Initiative will be paid by the end of 2016. At both June 30, 2016 and December 31, 2015 , all of the restructuring accrual was included in Accrued expenses, as there was no long-term portion. |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of activity related to outstanding stock options | The activity related to the Company's outstanding stock options during the six months ended June 30, 2016 is as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at January 1, 2016 6,352,208 $ 15.99 Granted 129,510 $ 8.30 Exercised (3,224 ) $ 4.35 Forfeited (122,794 ) $ 15.52 Expired (244,445 ) $ 18.40 Outstanding at June 30, 2016 6,111,255 $ 15.74 5.68 $ 492 Vested or expected to vest at June 30, 2016 5,978,629 $ 15.78 5.62 $ 457 Exercisable at June 30, 2016 4,739,687 $ 15.80 5.05 $ 337 |
Schedule of assumptions used to estimate the fair value of options at the date of grant using the Black-Scholes option pricing model | The grant date fair values of options to purchase common stock granted in the three and six months ended June 30, 2016 were estimated using the Black-Scholes valuation model with the following assumptions: Three months ended Six months ended June 30, June 30, Risk-free interest rate 1.00% - 1.60% 1.00% - 1.60% Expected dividends — — Weighted average volatility 56.4% 55.6% Expected life (years) 5.0 - 10.0 5.0 - 10.0 |
Schedule of stock options, additional information | Additional information regarding the Company's stock options for the three and six months ended June 30, 2016 is as follows: Three months ended Six months ended June 30, June 30, Weighted average grant date fair value of stock options granted $ 4.88 $ 4.58 Total intrinsic value of stock options exercised (in thousands) $ 7 $ 11 Cash received from the exercise of stock options (in thousands) $ 10 $ 15 |
Schedule of activity related to unvested restricted stock grants | The activity related to the Company's RSAs for the six months ended June 30, 2016 is as follows: Shares Weighted Average Grant Date Fair Value Unvested balance at January 1, 2016 1,512,783 $ 13.48 Granted 1,440,902 $ 7.73 Vested (496,814 ) $ 12.62 Forfeited (280,597 ) $ 10.30 Unvested balance at June 30, 2016 2,176,274 $ 10.28 The activity related to the Company's RSUs for the six months ended June 30, 2016 is as follows: Shares Weighted Average Grant Date Fair Value Unvested balance at January 1, 2016 95,361 $ 16.05 Granted 53,400 $ 7.58 Vested (22,035 ) $ 16.05 Forfeited (2,425 ) $ 16.05 Unvested balance at June 30, 2016 124,301 $ 12.41 |
Schedule of activity related to performance stock awards | The activity related to the Company's PSUs for the six months ended June 30, 2016 is as follows: Shares Weighted Average Grant Date Fair Value Unvested balance at January 1, 2016 111,250 $ 14.68 Granted 131,250 $ 10.25 Vested — $ — Forfeited (66,665 ) $ 12.77 Unvested balance at June 30, 2016 175,835 $ 12.10 |
Schedule of stock-based compensation expenses which are included in condensed consolidated statement of operations | The condensed consolidated statements of operations include stock-based compensation for the three and six months ended June 30, 2016 and June 26, 2015 as follows (in thousands): Three months ended Six months ended June 30, June 26, June 30, June 26, Product cost of revenue $ 93 $ 83 $ 164 $ 157 Service cost of revenue 322 397 654 777 Research and development 1,210 1,445 2,389 2,803 Sales and marketing 1,224 1,852 2,244 2,868 General and administrative 1,792 3,032 3,605 5,024 $ 4,641 $ 6,809 $ 9,056 $ 11,629 |
MAJOR CUSTOMERS (Tables)
MAJOR CUSTOMERS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Risks and Uncertainties [Abstract] | |
Schedule of customers contributing 10% or more of the revenue | The following customers contributed 10% or more of the Company's revenue in at least one of the three or six month periods ended June 30, 2016 and June 26, 2015 : Three months ended Six months ended June 30, June 26, June 30, June 26, AT&T Inc. 16% 19% 14% 13% Verizon Communications Inc. 13% * * * Level 3 Communications * * 11% * _______________________ * Represents less than 10% of revenue |
GEOGRAPHIC INFORMATION (Tables)
GEOGRAPHIC INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Segment Reporting [Abstract] | |
Summary of revenue by geographic area as a percentage of total revenue | The Company's classification of revenue by geographic area is determined by the location to which the product is shipped or where the services are performed. The following table summarizes revenue by geographic area as a percentage of total revenue: Three months ended Six months ended June 30, June 26, June 30, June 26, United States 70 % 71 % 69 % 67 % Europe, Middle East and Africa 13 12 13 13 Japan 8 9 11 13 Other Asia Pacific 6 4 5 4 Other 3 4 2 3 100 % 100 % 100 % 100 % |
BASIS OF PRESENTATION - Narrati
BASIS OF PRESENTATION - Narrative (Details) | Jan. 30, 2015 | Jun. 30, 2016USD ($) | Jun. 30, 2016USD ($)segment | Dec. 31, 2015USD ($) |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Stock split, conversion ratio | 0.2 | |||
Number of reportable operating segments | segment | 1 | |||
Foreign Translation of Depreciation Expense | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Cumulative understatement of expense | $ 1,400,000 | |||
Tax effect of understatement | 0 | |||
Depreciation | $ 1,400,000 | $ 1,400,000 | ||
New Accounting Pronouncement, Early Adoption, Effect | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Deferred tax assets, net, current | $ (1,000,000) |
BUSINESS ACQUISITIONS - (Detail
BUSINESS ACQUISITIONS - (Details) - USD ($) | Jan. 02, 2015 | Jun. 30, 2016 | Sep. 25, 2015 | Jun. 26, 2015 | Jun. 30, 2016 | Jun. 26, 2015 | Dec. 31, 2015 | Jul. 02, 2015 | Dec. 31, 2014 |
Acquisition Of Net | |||||||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 750,000 | $ 10,147,000 | |||||||
Allocation of the purchase consideration: | |||||||||
Goodwill | $ 40,310,000 | $ 40,310,000 | 40,310,000 | 40,310,000 | $ 40,310,000 | $ 39,263,000 | |||
Treq Labs, Inc [Member] | |||||||||
Acquisition Of Net | |||||||||
Cash, net of cash acquired | $ 10,147,000 | ||||||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 11,647,000 | ||||||||
Future consideration payment | $ 750,000 | ||||||||
Shares authorized in earn-out agreement | 3,500,000 | ||||||||
Business combination, contingent liability | 0 | $ 0 | |||||||
Allocation of the purchase consideration: | |||||||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net | $ 11,647,000 | ||||||||
PT [Member] | |||||||||
Allocation of the purchase consideration: | |||||||||
Professional Fees | $ 24,000 | $ 131,000 | |||||||
In Process Research and Development [Member] | |||||||||
Acquisition Of Net | |||||||||
Intangible asset increase (decrease) due to transfer | (1,600,000) | $ (7,500,000) | |||||||
In Process Research and Development [Member] | Treq Labs, Inc [Member] | |||||||||
Allocation of the purchase consideration: | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | 9,100,000 | ||||||||
Developed Technology Rights [Member] | |||||||||
Acquisition Of Net | |||||||||
Intangible asset increase (decrease) due to transfer | $ 1,600,000 | $ 7,500,000 | |||||||
Developed Technology Rights [Member] | Treq Labs, Inc [Member] | |||||||||
Allocation of the purchase consideration: | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | 1,500,000 | ||||||||
Goodwill | $ 1,047,000 | ||||||||
Earn-Out Agreement Revenue Level 1 [Member] | |||||||||
Acquisition Of Net | |||||||||
Duration of earn-out agreement | 3 years | ||||||||
Earn-Out Agreement Revenue Level 1 [Member] | Treq Labs, Inc [Member] | |||||||||
Acquisition Of Net | |||||||||
Shares authorized in earn-out agreement | 1,300,000 | ||||||||
Earn-out agreement aggregate revenue threshold | $ 60,000,000 | ||||||||
Earn-Out Agreement Revenue Level 2 [Member] | Treq Labs, Inc [Member] | |||||||||
Acquisition Of Net | |||||||||
Shares authorized in earn-out agreement | 2,200,000 | ||||||||
Earn-out agreement aggregate revenue threshold | $ 150,000,000 | ||||||||
Earn-Out Agreement Revenue Level 3 [Member] | Treq Labs, Inc [Member] | |||||||||
Acquisition Of Net | |||||||||
Shares authorized in earn-out agreement | 0 |
EARNINGS (LOSS) PER SHARE - (De
EARNINGS (LOSS) PER SHARE - (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 26, 2015 | Jun. 30, 2016 | Jun. 26, 2015 | |
Reconciliation of weighted average shares outstanding from basic to diluted | ||||
Weighted average shares outstanding - basic | 49,423 | 49,484 | 49,453 | 49,454 |
Potential dilutive common shares | 0 | 0 | 0 | 0 |
Weighted average shares outstanding - diluted | 49,423 | 49,484 | 49,453 | 49,454 |
Common stock and unvested shares of restricted stock not included because their effect would have been antidilutive (in shares) | 8,700 | 8,900 | 8,700 | 8,900 |
CASH EQUIVALENTS AND INVESTME38
CASH EQUIVALENTS AND INVESTMENTS - Narrative (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Schedule of Available-for-sale Securities [Line Items] | |
Available-for-sale securities sold | $ 3,800 |
Available-for-sale securities, gross realized gains | $ 18 |
Minimum [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Period considered to classify available-for-sale securities as investments | 1 year |
Maximum [Member] | |
Schedule of Available-for-sale Securities [Line Items] | |
Period considered to classify available-for-sale securities as investments | 2 years |
CASH EQUIVALENTS AND INVESTME39
CASH EQUIVALENTS AND INVESTMENTS - Schedule of Activity for Short-Term Investments (Detail) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Amortized cost, gross unrealized gains and losses and fair value of marketable debt and equity securities and investments | ||
Cash equivalents, amortized cost | $ 4,097 | $ 7,122 |
Cash equivalents, fair value | 4,097 | 7,122 |
Marketable securities, amortized cost | 52,473 | 58,590 |
Marketable securities, unrealized gains | 42 | 2 |
Marketable securities, unrealized losses | (10) | (59) |
Marketable securities, fair value | 52,505 | 58,533 |
Investments, amortized cost | 53,841 | 33,705 |
Investments, unrealized gains | 105 | 2 |
Investments, unrealized losses | (4) | (102) |
Investments, fair value | 53,942 | 33,605 |
Municipal obligations [Member] | ||
Amortized cost, gross unrealized gains and losses and fair value of marketable debt and equity securities and investments | ||
Marketable securities, amortized cost | 4,804 | 3,910 |
Marketable securities, unrealized gains | 8 | 0 |
Marketable securities, unrealized losses | 0 | (1) |
Marketable securities, fair value | 4,812 | 3,909 |
Investments, amortized cost | 1,114 | 2,165 |
Investments, unrealized gains | 4 | 0 |
Investments, unrealized losses | 0 | (4) |
Investments, fair value | 1,118 | 2,161 |
U.S. government agency notes [Member] | ||
Amortized cost, gross unrealized gains and losses and fair value of marketable debt and equity securities and investments | ||
Marketable securities, amortized cost | 8,476 | 3,450 |
Marketable securities, unrealized gains | 11 | 0 |
Marketable securities, unrealized losses | 0 | (2) |
Marketable securities, fair value | 8,487 | 3,448 |
Investments, amortized cost | 26,949 | 1,999 |
Investments, unrealized gains | 52 | 0 |
Investments, unrealized losses | (2) | (13) |
Investments, fair value | 26,999 | 1,986 |
Corporate debt securities [Member] | ||
Amortized cost, gross unrealized gains and losses and fair value of marketable debt and equity securities and investments | ||
Marketable securities, amortized cost | 39,193 | 46,736 |
Marketable securities, unrealized gains | 23 | 2 |
Marketable securities, unrealized losses | (10) | (56) |
Marketable securities, fair value | 39,206 | 46,682 |
Investments, amortized cost | 25,778 | 29,541 |
Investments, unrealized gains | 49 | 2 |
Investments, unrealized losses | (2) | (85) |
Investments, fair value | $ 25,825 | 29,458 |
Commercial paper [Member] | ||
Amortized cost, gross unrealized gains and losses and fair value of marketable debt and equity securities and investments | ||
Marketable securities, amortized cost | 3,994 | |
Marketable securities, unrealized gains | 0 | |
Marketable securities, unrealized losses | 0 | |
Marketable securities, fair value | 3,994 | |
Certificates of deposit [Member] | ||
Amortized cost, gross unrealized gains and losses and fair value of marketable debt and equity securities and investments | ||
Marketable securities, amortized cost | 500 | |
Marketable securities, unrealized gains | 0 | |
Marketable securities, unrealized losses | 0 | |
Marketable securities, fair value | $ 500 |
CASH EQUIVALENTS AND INVESTME40
CASH EQUIVALENTS AND INVESTMENTS - Schedule of Short-Term Investments by Measurement (Detail) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Cash and cash equivalents, Marketable securities and Investments | ||
Cash equivalents, fair value | $ 4,097 | $ 7,122 |
Marketable securities, fair value | 52,505 | 58,533 |
Investments, fair value | 53,942 | 33,605 |
Total carrying value [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Cash equivalents, fair value | 4,097 | 7,122 |
Marketable securities, fair value | 52,505 | 58,533 |
Investments, fair value | 53,942 | 33,605 |
Quoted prices in active markets (Level 1) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Cash equivalents, fair value | 4,097 | 7,122 |
Marketable securities, fair value | 0 | 0 |
Investments, fair value | 0 | 0 |
Significant other observable inputs (Level 2) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Cash equivalents, fair value | 0 | 0 |
Marketable securities, fair value | 52,505 | 58,533 |
Investments, fair value | 53,942 | 33,605 |
Significant unobservable inputs (Level 3) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Cash equivalents, fair value | 0 | 0 |
Marketable securities, fair value | 0 | 0 |
Investments, fair value | 0 | 0 |
Municipal obligations [Member] | Total carrying value [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 4,812 | 3,909 |
Investments, fair value | 1,118 | 2,161 |
Municipal obligations [Member] | Quoted prices in active markets (Level 1) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 0 | 0 |
Investments, fair value | 0 | 0 |
Municipal obligations [Member] | Significant other observable inputs (Level 2) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 4,812 | 3,909 |
Investments, fair value | 1,118 | 2,161 |
Municipal obligations [Member] | Significant unobservable inputs (Level 3) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 0 | 0 |
Investments, fair value | 0 | 0 |
U.S. government agency notes [Member] | Total carrying value [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 8,487 | 3,448 |
Investments, fair value | 26,999 | 1,986 |
U.S. government agency notes [Member] | Quoted prices in active markets (Level 1) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 0 | 0 |
Investments, fair value | 0 | 0 |
U.S. government agency notes [Member] | Significant other observable inputs (Level 2) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 8,487 | 3,448 |
Investments, fair value | 26,999 | 1,986 |
U.S. government agency notes [Member] | Significant unobservable inputs (Level 3) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 0 | 0 |
Investments, fair value | 0 | 0 |
Corporate debt securities [Member] | Total carrying value [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 39,206 | 46,682 |
Investments, fair value | 25,825 | 29,458 |
Corporate debt securities [Member] | Quoted prices in active markets (Level 1) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 0 | 0 |
Investments, fair value | 0 | 0 |
Corporate debt securities [Member] | Significant other observable inputs (Level 2) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 39,206 | 46,682 |
Investments, fair value | 25,825 | 29,458 |
Corporate debt securities [Member] | Significant unobservable inputs (Level 3) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 0 | 0 |
Investments, fair value | $ 0 | 0 |
Commercial paper [Member] | Total carrying value [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 3,994 | |
Commercial paper [Member] | Quoted prices in active markets (Level 1) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 0 | |
Commercial paper [Member] | Significant other observable inputs (Level 2) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 3,994 | |
Commercial paper [Member] | Significant unobservable inputs (Level 3) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 0 | |
Certificates of deposit [Member] | Total carrying value [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 500 | |
Certificates of deposit [Member] | Quoted prices in active markets (Level 1) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 0 | |
Certificates of deposit [Member] | Significant other observable inputs (Level 2) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | 500 | |
Certificates of deposit [Member] | Significant unobservable inputs (Level 3) [Member] | ||
Cash and cash equivalents, Marketable securities and Investments | ||
Marketable securities, fair value | $ 0 |
INVENTORY - (Details)
INVENTORY - (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
On-hand final assemblies and finished goods inventories | $ 17,416 | $ 17,136 |
Deferred cost of goods sold | 4,858 | 5,975 |
Gross inventory | 22,274 | 23,111 |
Less current portion | (20,674) | (23,111) |
Inventory, Noncurrent | $ 1,600 | $ 0 |
INTANGIBLE ASSETS AND GOODWIL42
INTANGIBLE ASSETS AND GOODWILL - (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2016 | Sep. 25, 2015 | Jun. 26, 2015 | Jun. 30, 2016 | Jun. 26, 2015 | Dec. 31, 2015 | |
Intangible Assets And Goodwill | ||||||
Weighted average amortization period (years) | 6 years 2 months 10 days | 6 years 2 months 8 days | ||||
Cost | $ 43,640 | $ 43,640 | $ 43,640 | |||
Accumulated amortization | 21,272 | 21,272 | 17,553 | |||
Net carrying value | 22,368 | 22,368 | $ 26,087 | |||
Amortization expense | 1,773 | $ 1,591 | 3,719 | $ 3,238 | ||
Estimated future amortization expense for intangible assets | ||||||
Remainder of 2016 | 3,548 | 3,548 | ||||
2,017 | 7,265 | 7,265 | ||||
2,018 | 4,596 | 4,596 | ||||
2,019 | 3,571 | 3,571 | ||||
2,020 | 2,070 | 2,070 | ||||
Thereafter | 1,318 | 1,318 | ||||
Total | 22,368 | $ 22,368 | ||||
In Process Research and Development [Member] | ||||||
Intangible Assets And Goodwill | ||||||
Intangible asset increase (decrease) due to transfer | (1,600) | $ (7,500) | ||||
Developed technology [Member] | ||||||
Intangible Assets And Goodwill | ||||||
Weighted average amortization period (years) | 7 years | 6 years 5 months 12 days | 6 years 5 months 2 days | |||
Cost | 32,880 | $ 32,880 | $ 31,280 | |||
Accumulated amortization | 13,497 | 13,497 | 10,415 | |||
Net carrying value | 19,383 | 19,383 | $ 20,865 | |||
Amortization expense | 1,455 | 1,116 | $ 3,082 | 2,223 | ||
Intangible asset increase (decrease) due to transfer | 1,600 | $ 7,500 | ||||
Customer relationships [Member] | ||||||
Intangible Assets And Goodwill | ||||||
Weighted average amortization period (years) | 5 years 6 months 26 days | 5 years 6 months 24 days | ||||
Cost | 10,030 | $ 10,030 | $ 10,030 | |||
Accumulated amortization | 7,045 | 7,045 | 6,408 | |||
Net carrying value | 2,985 | 2,985 | $ 3,622 | |||
Amortization expense | 318 | 415 | $ 637 | 894 | ||
Internal use software [Member] | ||||||
Intangible Assets And Goodwill | ||||||
Weighted average amortization period (years) | 3 years | 3 years | ||||
Cost | 730 | $ 730 | $ 730 | |||
Accumulated amortization | 730 | 730 | 730 | |||
Net carrying value | 0 | 0 | 0 | |||
Amortization expense | $ 0 | $ 60 | $ 0 | $ 121 | ||
In Process Research and Development [Member] | ||||||
Intangible Assets And Goodwill | ||||||
Indefinite-lived intangible assets | $ 1,600 |
INTANGIBLE ASSETS AND GOODWIL43
INTANGIBLE ASSETS AND GOODWILL - (Details 2) - USD ($) | 6 Months Ended | |||||
Jun. 30, 2016 | Jun. 26, 2015 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 26, 2015 | Dec. 31, 2014 | |
Goodwill [Line Items] | ||||||
Change in goodwill | $ 0 | |||||
Goodwill [Roll Forward] | ||||||
Goodwill | $ 43,416,000 | $ 43,416,000 | $ 42,369,000 | |||
Accumulated impairment losses | (3,106,000) | (3,106,000) | (3,106,000) | |||
Goodwill, beginning of period | 40,310,000 | $ 40,310,000 | $ 40,310,000 | $ 40,310,000 | $ 40,310,000 | $ 39,263,000 |
Acquisition of SDN Business | 1,047,000 | |||||
Goodwill, end of period | $ 40,310,000 | $ 40,310,000 |
ACCRUED EXPENSES - (Details)
ACCRUED EXPENSES - (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Employee compensation and related costs | $ 12,651 | $ 22,180 |
Other | 8,298 | 9,783 |
Total | $ 20,949 | $ 31,963 |
RESTRUCTURING ACCRUAL - (Detail
RESTRUCTURING ACCRUAL - (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 26, 2015 | Jun. 30, 2016 | Jun. 26, 2015 | |
Restructuring Reserve [Roll Forward] | ||||
Initiatives charged to expense | $ 0 | $ 1,487 | $ 0 | $ 1,148 |
2015 Restructuring [Member] | ||||
Restructuring Reserve [Roll Forward] | ||||
Balance at the beginning of the period | 749 | |||
Initiatives charged to expense | 0 | |||
Adjustments for changes in estimate | 0 | |||
Cash payments | (649) | |||
Balance at the end of the period | $ 100 | $ 100 |
DEBT - (Details)
DEBT - (Details) - USD ($) | Jun. 13, 2016 | Jun. 30, 2016 | Jun. 26, 2015 | Dec. 31, 2015 |
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 20,000,000 | $ 15,000,000 | ||
Revolving Credit Facility [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Covenant terms, minimum cash and cash equivalents | $ 50,000,000 | $ 85,000,000 | ||
Unused commitment fee percentage | 0.1125% | 0.15% | ||
Covenant terms, minimum total revenues | $ 50,000,000 | |||
Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate (as a percent) | 1.50% | |||
Revolving Credit Facility [Member] | Federal Funds Purchased [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate (as a percent) | 0.50% | |||
Revolving Credit Facility [Member] | Eurodollar [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate (as a percent) | 1.00% |
COMMON STOCK REPURCHASES AND 47
COMMON STOCK REPURCHASES AND UNDERWRITTEN OFFERING (Details) - USD ($) shares in Millions | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 26, 2015 | Jul. 29, 2013 | |
Class of Stock [Line Items] | |||
Payments for repurchase of common stock | $ 4,980,000 | $ 6,084,000 | |
Stock repurchased and retired during period (in shares) | 0.6 | 0.4 | |
Remaining authorized repurchase amount | $ 10,000,000 | ||
Common Stock [Member] | |||
Class of Stock [Line Items] | |||
Stock buyback program authorized amount | $ 100,000,000 | ||
Stock Buyback Program [Member] | |||
Class of Stock [Line Items] | |||
Payments for repurchase of common stock | $ 5,000,000 | $ 6,100,000 |
STOCK-BASED COMPENSATION PLAN48
STOCK-BASED COMPENSATION PLANS - (Details) | Jun. 09, 2016shares | Apr. 01, 2016executivesshares | Mar. 16, 2015executivesshares | Jun. 30, 2016USD ($)executives$ / sharesshares | Feb. 29, 2016executivesshares | Mar. 28, 2014shares | Jun. 30, 2016USD ($)$ / sharesshares | Jun. 26, 2015USD ($) | Jun. 30, 2016USD ($)$ / sharesshares | Jun. 26, 2015USD ($) | Jun. 10, 2015 | Jun. 08, 2016 | Dec. 31, 2015executives$ / sharesshares | Dec. 14, 2014 |
Stock-based compensation | ||||||||||||||
Stock-based compensation (in dollars) | $ | $ 4,641,000 | $ 6,809,000 | $ 9,056,000 | $ 11,629,000 | ||||||||||
Range of assumptions used in estimating fair value of options | ||||||||||||||
Expected life | 5 years | |||||||||||||
Cash received from the exercise of stock options (in dollars) | $ | $ 15,000 | 1,739,000 | ||||||||||||
Weighted average grant-date fair value | ||||||||||||||
Tax benefit from stock based compensation expense | $ | 0 | |||||||||||||
Fair value of the assumed awards attributable to future stock-based compensation expense | $ | $ 28,800,000 | 28,800,000 | $ 28,800,000 | |||||||||||
Expected period for unrecognized expense | 2 years | |||||||||||||
Product cost of revenue [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Stock-based compensation (in dollars) | $ | 93,000 | 83,000 | $ 164,000 | 157,000 | ||||||||||
Service cost of revenue [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Stock-based compensation (in dollars) | $ | 322,000 | 397,000 | 654,000 | 777,000 | ||||||||||
Research and development [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Stock-based compensation (in dollars) | $ | 1,210,000 | 1,445,000 | 2,389,000 | 2,803,000 | ||||||||||
Sales and marketing [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Stock-based compensation (in dollars) | $ | 1,224,000 | 1,852,000 | 2,244,000 | 2,868,000 | ||||||||||
General and Administrative Expense [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Stock-based compensation (in dollars) | $ | $ 1,792,000 | $ 3,032,000 | $ 3,605,000 | $ 5,024,000 | ||||||||||
Minimum [Member] | ||||||||||||||
Range of assumptions used in estimating fair value of options | ||||||||||||||
Expected life | 5 years | 5 years | ||||||||||||
Maximum [Member] | ||||||||||||||
Range of assumptions used in estimating fair value of options | ||||||||||||||
Expected life | 10 years | 10 years | ||||||||||||
Stock Options [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | |||||||||||||
Weighted average grant date fair value of stock options granted (in dollars per share) | $ / shares | $ 4.88 | $ 4.58 | ||||||||||||
Number of shares | ||||||||||||||
Outstanding at the beginning of the period (in shares) | 6,352,208 | |||||||||||||
Granted (in shares) | 129,510 | |||||||||||||
Exercised (in shares) | (3,224) | |||||||||||||
Forfeited (in shares) | (122,794) | |||||||||||||
Expired (in shares) | (244,445) | |||||||||||||
Outstanding at the end of the period (in shares) | 6,111,255 | 6,111,255 | 6,111,255 | 6,352,208 | ||||||||||
Vested or expected to vest at the end of the period (in shares) | 5,978,629 | 5,978,629 | 5,978,629 | |||||||||||
Exercisable at the end of the period (in shares) | 4,739,687 | 4,739,687 | 4,739,687 | |||||||||||
Weighted average exercise price | ||||||||||||||
Outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 15.99 | |||||||||||||
Granted (in dollars per share) | $ / shares | 8.30 | |||||||||||||
Exercised (in dollars per share) | $ / shares | 4.35 | |||||||||||||
Forfeited (in dollars per share) | $ / shares | 15.52 | |||||||||||||
Expired (in dollars per share) | $ / shares | 18.40 | |||||||||||||
Outstanding at the end of the period (in dollars per share) | $ / shares | $ 15.74 | $ 15.74 | 15.74 | $ 15.99 | ||||||||||
Vested or expected to vest at the end of the period (in dollars per share) | $ / shares | 15.78 | 15.78 | 15.78 | |||||||||||
Exercisable at the end of the period (in dollars per share) | $ / shares | $ 15.80 | $ 15.80 | $ 15.80 | |||||||||||
Weighted average remaining contractual life (in years) | ||||||||||||||
Outstanding at the end of the period | 5 years 8 months 5 days | |||||||||||||
Vested or expected to vest at the end of the period | 5 years 7 months 15 days | |||||||||||||
Exercisable at the end of the period | 5 years 18 days | |||||||||||||
Aggregate intrinsic value (in dollars) | ||||||||||||||
Outstanding at the end of the period (in dollars) | $ | $ 492,000 | $ 492,000 | $ 492,000 | |||||||||||
Vested or expected to vest at the end of the period (in dollars) | $ | 457,000 | 457,000 | 457,000 | |||||||||||
Exercisable at the end of the period (in dollars) | $ | $ 337,000 | $ 337,000 | $ 337,000 | |||||||||||
Range of assumptions used in estimating fair value of options | ||||||||||||||
Expected dividends | 0.00% | 0.00% | ||||||||||||
Weighted average volatility | 56.40% | 55.60% | ||||||||||||
Total intrinsic values of stock options exercised (in dollars) | $ | $ 7,000 | $ 11,000 | ||||||||||||
Cash received from the exercise of stock options (in dollars) | $ | $ 10,000 | $ 15,000 | ||||||||||||
Stock Options [Member] | Minimum [Member] | ||||||||||||||
Range of assumptions used in estimating fair value of options | ||||||||||||||
Risk-free interest rate | 1.00% | |||||||||||||
Stock Options [Member] | Maximum [Member] | ||||||||||||||
Range of assumptions used in estimating fair value of options | ||||||||||||||
Risk-free interest rate | 1.60% | |||||||||||||
Stock Options [Member] | Share-based Compensation Award, Tranche One [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 33.33% | |||||||||||||
Stock Options [Member] | Share-based Compensation Award, Tranche Two [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 66.67% | |||||||||||||
Restricted Stock Grants [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | |||||||||||||
Restricted Stock Grants [Member] | Share-based Compensation Award, Tranche One [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 33.33% | |||||||||||||
Restricted Stock Grants [Member] | Share-based Compensation Award, Tranche Two [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 66.67% | |||||||||||||
Restricted stock awards [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Total fair value (in dollars) | $ | $ 6,600,000 | |||||||||||||
Change in unvested restricted stock awards | ||||||||||||||
Unvested balance at the beginning of the period (in shares) | 1,512,783 | |||||||||||||
Granted (in shares) | 1,440,902 | |||||||||||||
Vested (in shares) | (496,814) | |||||||||||||
Forfeited (in shares) | (280,597) | |||||||||||||
Unvested balance at the end of the period (in shares) | 2,176,274 | 2,176,274 | 2,176,274 | 1,512,783 | ||||||||||
Weighted average grant-date fair value | ||||||||||||||
Unvested balance at the end of the period (in dollars per share) | $ / shares | $ 13.48 | |||||||||||||
Granted (in dollars per share) | $ / shares | 7.73 | |||||||||||||
Vested (in dollars per share) | $ / shares | 12.62 | |||||||||||||
Forfeited (in dollars per share) | $ / shares | 10.30 | |||||||||||||
Unvested balance at end of the period (in dollars per share) | $ / shares | $ 10.28 | $ 10.28 | $ 10.28 | $ 13.48 | ||||||||||
Restricted Stock Units (RSUs) [Member] | ||||||||||||||
Change in unvested restricted stock awards | ||||||||||||||
Unvested balance at the beginning of the period (in shares) | 95,361 | |||||||||||||
Granted (in shares) | 53,400 | |||||||||||||
Vested (in shares) | (22,035) | |||||||||||||
Forfeited (in shares) | (2,425) | |||||||||||||
Unvested balance at the end of the period (in shares) | 124,301 | 124,301 | 124,301 | 95,361 | ||||||||||
Weighted average grant-date fair value | ||||||||||||||
Unvested balance at the end of the period (in dollars per share) | $ / shares | $ 16.05 | |||||||||||||
Granted (in dollars per share) | $ / shares | 7.58 | |||||||||||||
Vested (in dollars per share) | $ / shares | 16.05 | |||||||||||||
Forfeited (in dollars per share) | $ / shares | 16.05 | |||||||||||||
Unvested balance at end of the period (in dollars per share) | $ / shares | $ 12.41 | $ 12.41 | $ 12.41 | $ 16.05 | ||||||||||
Performance Share Units [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Executives Granted Shares | executives | 6 | 8 | 1 | 6 | 2 | |||||||||
Change in unvested restricted stock awards | ||||||||||||||
Unvested balance at the beginning of the period (in shares) | 111,250 | |||||||||||||
Granted (in shares) | 131,250 | 131,250 | 131,250 | |||||||||||
Vested (in shares) | 0 | |||||||||||||
Forfeited (in shares) | (37,081) | (66,665) | ||||||||||||
Unvested balance at the end of the period (in shares) | 175,835 | 175,835 | 175,835 | 111,250 | ||||||||||
Weighted average grant-date fair value | ||||||||||||||
Unvested balance at the end of the period (in dollars per share) | $ / shares | $ 14.68 | |||||||||||||
Granted (in dollars per share) | $ / shares | 10.25 | |||||||||||||
Vested (in dollars per share) | $ / shares | 0 | |||||||||||||
Forfeited (in dollars per share) | $ / shares | 12.77 | |||||||||||||
Unvested balance at end of the period (in dollars per share) | $ / shares | $ 12.10 | $ 12.10 | $ 12.10 | $ 14.68 | ||||||||||
Performance Share Units [Member] | Share-based Compensation Award, Tranche One [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 33.33% | 33.33% | ||||||||||||
Performance Share Units [Member] | Share-based Compensation Award, Tranche Two [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 33.33% | 33.33% | ||||||||||||
Performance Share Units [Member] | Share-based Compensation Award, Tranche Three [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 33.33% | 33.33% | ||||||||||||
Employee Stock [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation by Share-based Payment Award, Offering Period | 6 months | |||||||||||||
Purchase price of common stock (percentage) | 85.00% | |||||||||||||
Weighted average grant-date fair value | ||||||||||||||
Maximum number of shares purchasable per employee | 500 | |||||||||||||
the Stock Plan [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Number of shares of common stock authorized for issuance | 800,000 | |||||||||||||
Rate at which full value awards are counted against shares of common stock available for issuance | 1.50 | 1.57 | 1.61 | 1.50 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,000,000 | |||||||||||||
the Stock Plan [Member] | Director [Member] | ||||||||||||||
Stock-based compensation | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 100,000 |
MAJOR CUSTOMERS - (Details)
MAJOR CUSTOMERS - (Details) - customer | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 26, 2015 | Jun. 30, 2016 | Jun. 26, 2015 | Dec. 31, 2015 | |
Revenue [Member] | Less than [Member] | |||||
MAJOR CUSTOMERS | |||||
Threshold percentage | 10.00% | ||||
Revenue [Member] | Customer [Member] | AT&T [Member] | |||||
MAJOR CUSTOMERS | |||||
Concentration risk, percentage | 16.00% | 19.00% | 14.00% | 13.00% | |
Revenue [Member] | Customer [Member] | Verizon [Member] | |||||
MAJOR CUSTOMERS | |||||
Concentration risk, percentage | 13.00% | ||||
Revenue [Member] | Customer [Member] | Level 3 Communications [Member] | |||||
MAJOR CUSTOMERS | |||||
Concentration risk, percentage | 11.00% | ||||
Accounts receivable balance [Member] | |||||
MAJOR CUSTOMERS | |||||
Threshold percentage | 10.00% | ||||
Accounts receivable balance [Member] | Customer [Member] | |||||
MAJOR CUSTOMERS | |||||
Concentration risk, percentage | 21.00% | 11.00% | |||
Number of major customers | 1 | 1 | 1 |
GEOGRAPHIC INFORMATION - Summar
GEOGRAPHIC INFORMATION - Summary of Revenue by Geographic Area as a Percentage of Total Revenue (Details) - Revenue [Member] - Geographical area [Member] | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 26, 2015 | Jun. 30, 2016 | Jun. 26, 2015 | |
Revenue by geographic area and by customer | ||||
Percentage of total revenue | 100.00% | 100.00% | 100.00% | 100.00% |
United States [Member] | ||||
Revenue by geographic area and by customer | ||||
Percentage of total revenue | 70.00% | 71.00% | 69.00% | 67.00% |
Europe, Middle East and Africa [Member] | ||||
Revenue by geographic area and by customer | ||||
Percentage of total revenue | 13.00% | 12.00% | 13.00% | 13.00% |
Japan [Member] | ||||
Revenue by geographic area and by customer | ||||
Percentage of total revenue | 8.00% | 9.00% | 11.00% | 13.00% |
Other Asia Pacific [Member] | ||||
Revenue by geographic area and by customer | ||||
Percentage of total revenue | 6.00% | 4.00% | 5.00% | 4.00% |
Other [Member] | ||||
Revenue by geographic area and by customer | ||||
Percentage of total revenue | 3.00% | 4.00% | 2.00% | 3.00% |
RELATED PARTY (Details)
RELATED PARTY (Details) - USD ($) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2016 | Jun. 30, 2016 | |
Affiliated Entity [Member] | ||
Related Party Transaction [Line Items] | ||
Revenue from related parties | $ 0 | $ 23,000 |
INCOME TAXES - (Details)
INCOME TAXES - (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Income Tax Disclosure [Abstract] | |
Discrete charge related to an uncertain tax position | $ 0.7 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | Sep. 21, 2015shareholder | Apr. 06, 2015officers |
Commitments and Contingencies Disclosure [Abstract] | ||
Number of officers listed as defendants | officers | 2 | |
Number of shareholders seeking plaintiff status | shareholder | 4 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - Subsequent Event [Member] $ in Millions | Jul. 27, 2016USD ($) |
Minimum [Member] | |
Subsequent Event [Line Items] | |
Expected restructuring expense over the next twelve months | $ 3 |
Expected annual savings | 6 |
Maximum [Member] | |
Subsequent Event [Line Items] | |
Expected restructuring expense over the next twelve months | 4 |
Expected annual savings | $ 8 |