Oclaro 10-Q 6 Feb 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Dec. 31, 2016	Feb. 01, 2017
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Dec. 31, 2016
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q2
Trading Symbol	OCLR
Entity Registrant Name	OCLARO, INC.
Entity Central Index Key	1,110,647
Current Fiscal Year End Date	--07-01
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		166,590,393

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Dec. 31, 2016	Jul. 02, 2016
Current assets:
Cash and cash equivalents	$ 222,796	$ 95,929
Restricted cash	715	715
Short-term investments	19,948	0
Accounts receivable, net of allowances for doubtful accounts of $1,641 and $1,674 as of December 31, 2016 and July 2, 2016, respectively	107,513	93,571
Inventories	82,313	76,369
Prepaid expenses and other current assets	33,183	23,591
Total current assets	466,468	290,175
Property and equipment, net	81,402	65,045
Other intangible assets, net	986	1,498
Other non-current assets	2,364	2,331
Total assets	551,220	359,049
Current liabilities:
Accounts payable	82,167	71,201
Accrued expenses and other liabilities	40,358	34,818
Capital lease obligations, current	2,425	3,753
Total current liabilities	124,950	109,772
Deferred gain on sale-leaseback	5,938	6,809
Convertible notes payable	0	62,058
Capital lease obligations, non-current	1,579	2,105
Other non-current liabilities	10,502	11,694
Total liabilities	142,969	192,438
Commitments and contingencies (Note 7)
Stockholders’ equity:
Preferred stock: 1,000 shares authorized; none issued and outstanding	0	0
Common stock: $0.01 par value per share; 275,000 shares authorized; 166,485 shares issued and outstanding at December 31, 2016 and 112,207 shares issued and outstanding at July 2, 2016	1,665	1,122
Additional paid-in capital	1,681,999	1,471,280
Accumulated other comprehensive income	36,581	39,821
Accumulated deficit	(1,311,994)	(1,345,612)
Total stockholders’ equity	408,251	166,611
Total liabilities and stockholders’ equity	$ 551,220	$ 359,049

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2016	Jul. 02, 2016
Statement of Financial Position [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 1,641	$ 1,674
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized	275,000,000	275,000,000
Common stock, shares issued	166,485,000	112,207,000
Common stock, shares outstanding	166,485,000	112,207,000

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Income Statement [Abstract]
Revenues	$ 153,914	$ 94,129	$ 289,406	$ 181,679
Cost of revenues	93,150	67,521	182,286	132,374
Gross profit	60,764	26,608	107,120	49,305
Operating expenses:
Research and development	13,758	11,075	26,865	22,020
Selling, general and administrative	13,355	12,791	28,147	25,999
Amortization of other intangible assets	241	250	485	501
Restructuring, acquisition and related (income) expense, net	82	6	393	38
(Gain) loss on sale of property and equipment	(74)	(46)	(111)	167
Total operating expenses	27,362	24,076	55,779	48,725
Operating income	33,402	2,532	51,341	580
Other income (expense):
Interest income (expense), net	70	(1,247)	(13,788)	(2,523)
Gain (loss) on foreign currency transactions, net	(3,324)	(500)	(3,842)	4
Other income (expense), net	156	357	350	470
Total other income (expense)	(3,098)	(1,390)	(17,280)	(2,049)
Income (loss) before income taxes	30,304	1,142	34,061	(1,469)
Income tax provision	37	985	443	1,884
Net income (loss)	$ 30,267	$ 157	$ 33,618	$ (3,353)
Net income (loss) per share:
Basic (in USD per share)	$ 0.18	$ 0	$ 0.23	$ (0.03)
Diluted (in USD per share)	$ 0.18	$ 0	$ 0.21	$ (0.03)
Shares used in computing net income (loss) per share:
Basic (in shares)	165,822	110,296	149,151	109,877
Diluted (in shares)	168,856	112,394	159,801	109,877

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 30,267	$ 157	$ 33,618	$ (3,353)
Other comprehensive income (loss):
Unrealized gain on marketable securities	5	0	5	0
Currency translation adjustments	(3,799)	(596)	(3,245)	(2,479)
Pension adjustments	0	0	0	(10)
Total comprehensive income (loss)	$ 26,473	$ (439)	$ 30,378	$ (5,842)

CONDENSED CONSOLIDATED STATEME6

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015
Cash flows from operating activities:
Net income (loss)	$ 33,618	$ (3,353)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Amortization of deferred gain on sale-leaseback	(370)	(441)
Amortization of debt discount and issuance costs in connection with convertible notes payable	102	406
Depreciation and amortization	10,168	8,040
Interest make-whole charge and induced conversion expense related to convertible notes	8,463	0
Stock-based compensation expense	5,032	4,367
Other non-cash adjustments	(112)	167
Changes in operating assets and liabilities:
Accounts receivable, net	(17,067)	(4,268)
Inventories	(11,517)	(6,355)
Prepaid expenses and other current assets	(12,042)	1,734
Other non-current assets	(207)	296
Accounts payable	8,489	1,930
Accrued expenses and other liabilities	8,585	5,479
Net cash provided by operating activities	33,142	8,002
Cash flows from investing activities:
Purchases of property and equipment	(23,030)	(6,632)
Purchases of short-term investments	(19,953)	0
Transfer from restricted cash	0	1,555
Net cash used in investing activities	(42,983)	(5,077)
Cash flows from financing activities:
Proceeds from the exercise of stock options	2,587	133
Shares repurchased for tax withholdings on vesting of restricted stock units	(2,518)	(554)
Proceeds from the sale of common stock in connection with public offering, net of expenses	135,153	0
Payments on capital lease obligations	(1,493)	(1,468)
Net cash provided by (used in) financing activities	133,729	(1,889)
Effect of exchange rate on cash and cash equivalents	2,979	1,182
Net increase in cash and cash equivalents	126,867	2,218
Cash and cash equivalents at beginning of period	95,929	111,840
Cash and cash equivalents at end of period	222,796	114,058
Supplemental disclosures of cash flow information:
Cash paid for interest make-whole and induced conversion charges related to the exercise of convertible notes	4,700	0
Supplemental disclosures of non-cash transactions:
Issuance of common stock in exchange for the net carrying value of the liability component of convertible notes	62,125	0
Purchases of property and equipment funded by accounts payable	$ 9,359	$ 6,099

BASIS OF PREPARATION

BASIS OF PREPARATION	6 Months Ended
	Dec. 31, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BASIS OF PREPARATION	BASIS OF PREPARATION Basis of Presentation Oclaro, Inc., a Delaware corporation, is sometimes referred to in this Quarterly Report on Form 10-Q as “Oclaro,” “we,” “us” or “our.” The accompanying unaudited condensed consolidated financial statements of Oclaro as of December 31, 2016 and for the three and six months ended December 31, 2016 and December 26, 2015 have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Article 10 of Securities and Exchange Commission ("SEC") Regulation S-X, and include the accounts of Oclaro and all of our subsidiaries. Accordingly, they do not include all of the information and footnotes required by such accounting principles for annual financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our consolidated financial position and results of operations have been included. The condensed consolidated results of operations for the three and six months ended December 31, 2016 are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year ending July 1, 2017 . The condensed consolidated balance sheet as of July 2, 2016 has been derived from our audited financial statements as of such date, but does not include all disclosures required by U.S. GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with our audited financial statements included in our Annual Report on Form 10-K for the year ended July 2, 2016 (" 2016 Form 10-K"). Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reported periods. Examples of significant estimates and assumptions made by management involve the fair value of other intangible assets and long-lived assets, valuation allowances for deferred tax assets, the fair value of stock-based compensation, the fair value of embedded derivatives related to convertible debt, the fair value of pension liabilities, estimates for allowances for doubtful accounts and valuation of excess and obsolete inventories. These judgments can be subjective and complex and consequently actual results could differ materially from those estimates and assumptions. Descriptions of the key estimates and assumptions are included in our 2016 Form 10-K. Fiscal Years We operate on a 52/53 week year ending on the Saturday closest to June 30. Our fiscal year ending July 1, 2017 will be a 52 week year, with the quarter ended December 31, 2016 being a 13 week quarterly period. Our fiscal year ended July 2, 2016 was a 53 week year, with the quarter ended December 26, 2015 being a 13 week quarterly period. Reclassifications For presentation purposes, we have reclassified certain prior period amounts to conform to the current period financial statement presentation. These reclassifications did not affect our consolidated revenues, net loss, cash flows, cash and cash equivalents or stockholders’ equity as previously reported. Recent Developments In August 2016, we entered into multiple privately negotiated agreements, pursuant to which all of our 6.00% Notes were cancelled, and the indenture, by and between us and U.S. Bank National Association, pursuant to which the 6.00% Notes were issued, was satisfied and discharged. In connection with these privately negotiated agreements, we issued a total of 34,659,972 shares of our common stock and made total cash payments of $4.7 million . See Note 5, Credit Line and Notes , for additional information. In September 2016, we entered into an underwriting agreement with Jefferies LLC, as representative of several underwriters, pursuant to which we sold 17,250,000 shares of our common stock in a public offering. The net proceeds to us after deducting underwriting discounts and commissions and offering expenses was approximately $135.2 million . See Note 3, Balance Sheet Details for additional information. In November 2016, our stockholders approved an amendment to the Fifth Amended and Restated 2001 Long-Term Stock Incentive Plan, adding 6.0 million shares of common stock to the share reserve. See Note 8, Employee Stock Plans , for additional information.

RECENT ACCOUNTING STANDARDS

RECENT ACCOUNTING STANDARDS	6 Months Ended
	Dec. 31, 2016
Accounting Policies [Abstract]
RECENT ACCOUNTING STANDARDS	RECENT ACCOUNTING STANDARDS In November 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-18, Statement of Cash Flows: Restricted Cash to standardize the presentation of transfers between cash and restricted cash in the cash flow statement. Amounts described as restricted cash should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The guidance will be effective for us in the first quarter of fiscal 2019, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory , to reduce the complexity related to the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. This guidance will be effective for us in the first quarter of fiscal 2019, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments to reduce the diversity in practice related to the presentation and classification of various cash flow scenarios. This guidance will be effective for us in the first quarter of fiscal 2019, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In May 2014 and May 2016, the FASB issued ASU 2014-09, Revenue from Contracts with Customers and ASU 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients , respectively. These updates clarify the principles for recognizing revenue and develop a common revenue standard for GAAP and International Financial Reporting Standards. The standard 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. This guidance will be effective for us in the first quarter of fiscal 2019, with early adoption permitted for periods beginning after December 15, 2016. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In March 2016, the FASB issued ASU No. 2016-09, Compensation: Improvements to Employee Share-Based Payment Accounting , which simplifies several aspects of the accounting for employee share-based payment transactions, including the income tax consequences, classification of awards, and classification on the statement of cash flows. This guidance will be effective for us in the first quarter of fiscal 2018, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In February 2016, the FASB issued ASU No. 2016-02, Leases , which requires recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This guidance will be effective for us in the first quarter of fiscal 2020, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures.

BALANCE SHEET DETAILS

BALANCE SHEET DETAILS	6 Months Ended
	Dec. 31, 2016
Balance Sheet Details [Abstract]
BALANCE SHEET DETAILS	BALANCE SHEET DETAILS Cash, Cash Equivalents and Short-Term Investments The following table provides details regarding our cash, cash equivalents and short-term investments at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Cash and cash equivalents: Cash-in-bank $ 49,806 $ 70,925 Money market funds 157,627 25,004 Commercial paper 11,489 — Corporate bonds 3,874 — $ 222,796 $ 95,929 Short-term investments: Commercial paper $ 15,947 $ — Corporate bonds 4,001 — $ 19,948 $ — We classify short-term investments, which consist primarily of securities purchased with original maturities at date of purchase of more than three months and less than one year, as “available for sale securities”. These short-term investments are reported at market value, with the aggregate unrealized holding gains and losses reported as a component of accumulated other comprehensive income in stockholders’ equity. All realized gains and losses and unrealized losses resulting from declines in fair value that are other than temporary and not involving credit losses are recorded in the consolidated statements of operations in the period they occur. Restricted Cash As of December 31, 2016 , we had restricted cash of $1.1 million , comprised of $0.7 million in current assets and $0.4 million in other non-current assets, representing collateral for the performance of our obligations under certain lease facility agreements, collateral to secure certain of our credit card accounts and deposits for value-added taxes in foreign jurisdictions. Inventories The following table provides details regarding our inventories at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Inventories: Raw materials $ 26,649 $ 23,751 Work-in-process 32,458 32,819 Finished goods 23,206 19,799 $ 82,313 $ 76,369 Property and Equipment, Net The following table provides details regarding our property and equipment, net at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Property and equipment, net: Buildings and improvements $ 9,787 $ 10,389 Plant and machinery 73,064 59,696 Fixtures, fittings and equipment 2,904 3,005 Computer equipment 9,016 9,846 94,771 82,936 Less: Accumulated depreciation (13,369 ) (17,891 ) $ 81,402 $ 65,045 Property and equipment includes assets under capital leases of $4.0 million at December 31, 2016 and $5.9 million at July 2, 2016 , respectively. Amortization associated with assets under capital leases is recorded in depreciation expense. Other Intangible Assets, Net The following table summarizes the activity related to our other intangible assets for the six months ended December 31, 2016 : Core and Development Customer Patent Other Amortization Total (Thousands) Balance at July 2, 2016 $ 6,249 $ 4,509 $ 2,402 $ 915 $ 3,338 $ (15,915 ) $ 1,498 Amortization — — — — — (485 ) (485 ) Translations and adjustments — (27 ) — — — — (27 ) Balance at December 31, 2016 $ 6,249 $ 4,482 $ 2,402 $ 915 $ 3,338 $ (16,400 ) $ 986 We expect the amortization of intangible assets to be $0.3 million for the remainder of fiscal year 2017 and $0.6 million for fiscal year 2018, based on the current level of our other intangible assets as of December 31, 2016 . Accrued Expenses and Other Liabilities The following table presents details regarding our accrued expenses and other liabilities at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Accrued expenses and other liabilities: Trade payables $ 8,831 $ 6,429 Compensation and benefits related accruals 15,260 14,038 Warranty accrual 4,560 3,827 Accrued restructuring, current — 204 Purchase commitments in excess of future demand, current 2,625 1,723 Other accruals 9,094 8,597 $ 40,370 $ 34,818 Common Stock In August 2016, we issued a total of 34,659,972 shares of our common stock in connection with the cancellation of our 6.00% Notes. See Note 5, Credit Line and Notes , for additional information. On September 21, 2016, we entered into an underwriting agreement (the “Underwriting Agreement”) with Jefferies LLC, as representative of the several underwriters (the “Underwriters”), relating to the offering, issuance and sale (the “Offering”) of 15.0 million shares of our common stock, par value $0.01 per share (the “Common Stock”). The price to the public in the Offering was $8.35 per share. Under the terms of the Underwriting Agreement, we granted the Underwriters a 30 -day option to purchase up to an additional 2,250,000 shares of Common Stock. The option was exercised in full by the Underwriters on September 23, 2016. All of the shares in the Offering were sold by us. The Offering closed on September 27, 2016, subject to customary closing conditions. The net proceeds to us after deducting underwriting discounts and commissions and offering expenses are approximately $135.2 million. Accumulated Other Comprehensive Income The following table presents the components of accumulated other comprehensive income at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Accumulated other comprehensive income: Currency translation adjustments $ 36,939 $ 40,184 Unrealized gain on marketable securities 5 — Japan defined benefit plan (363 ) (363 ) $ 36,581 $ 39,821

FAIR VALUE

FAIR VALUE	6 Months Ended
	Dec. 31, 2016
Fair Value Disclosures [Abstract]
FAIR VALUE	FAIR VALUE We define fair value as the estimated price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining fair value measurements for assets and liabilities which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions and credit risk. We apply the following fair value hierarchy, which ranks the quality and reliability of the information used to determine fair values: Level 1- Quoted prices in active markets for identical assets or liabilities. Level 2- Inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices of identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets), or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3- Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. Our cash equivalents and short-term investment instruments are generally classified within Level 1 or Level 2 of the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. The types of instruments valued based on quoted market prices in active markets include most money market and marketable securities. Such instruments are generally classified within Level 1 of the fair value hierarchy. The types of instruments valued based on other observable inputs include investment-grade corporate bonds and commercial paper. Such instruments are generally classified within Level 2 of the fair value hierarchy. Assets and Liabilities Measured at Fair Value on a Recurring Basis Assets and liabilities measured at fair value on a recurring basis are shown in the table below by their corresponding balance sheet caption and consisted of the following types of instruments at December 31, 2016 and July 2, 2016 : Fair Value Measurement at December 31, 2016 Using Quoted Prices Significant Significant Total (Thousands) Assets: Cash and cash equivalents: (1) Money market funds $ 157,627 $ — $ — $ 157,627 Commercial paper — 11,489 — 11,489 Corporate bonds — 3,873 — 3,873 Short-term investments: Commercial paper — 15,947 — 15,947 Corporate bonds — 4,001 — 4,001 Restricted cash: Money market funds 712 — — 712 Total assets measured at fair value $ 158,339 $ 35,310 $ — $ 193,649 (1) Excludes $49.8 million in cash held in our bank accounts at December 31, 2016 . Fair Value Measurement at July 2, 2016 Using Quoted Prices Significant Significant Total (Thousands) Assets: Cash and cash equivalents: (1) Money market funds $ 25,004 $ — $ — $ 25,004 Restricted cash: Money market funds 712 — — 712 Total assets measured at fair value $ 25,716 $ — $ — $ 25,716 (1) Excludes $70.9 million in cash held in our bank accounts at July 2, 2016 .

CREDIT LINE AND NOTES

CREDIT LINE AND NOTES	6 Months Ended
	Dec. 31, 2016
Debt Disclosure [Abstract]
CREDIT LINE AND NOTES	CREDIT LINE AND NOTES 6.00% Convertible Senior Notes due 2020 (" 6.00% Notes") On February 12, 2015, we entered into a Purchase Agreement (the “Purchase Agreement”), with Jefferies LLC (the “Initial Purchaser”), pursuant to which we agreed to issue and sell to the Initial Purchaser up to $65.0 million in aggregate principal Convertible Senior Notes due 2020 (the “ 6.00% Notes”). On February 19, 2015, we closed the private placement of $65.0 million aggregate principal amount of the 6.00% Notes. The 6.00% Notes were sold at 100 percent of par, resulting in net proceeds of approximately $61.6 million , after deducting the Initial Purchaser’s discounts of $3.4 million . We also incurred offering expenses of $0.6 million . The net proceeds of this offering are being used for general corporate purposes, including working capital for, among other things, investing in development of new products and technologies. The Purchase Agreement contained customary representations and warranties of the parties and indemnification and contribution provisions under which we, on the one hand, and the Initial Purchaser, on the other, agreed to indemnify each other against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Prior to February 15, 2018, in the event that the last reported sale price of our common stock for 20 or more trading days (whether or not consecutive) in a period of 30 consecutive trading days ending within five trading days immediately prior to the date we receive a notice of conversion exceeds the conversion price in effect on each such trading day, we will, in addition to delivering shares upon conversion by the holder of 6.00% Notes, together with cash in lieu of fractional shares, make an interest make-whole payment in cash equal to the sum of the remaining scheduled payments of interest on the 6.00% Notes to be converted through February 15, 2018. The 6.00% Notes were scheduled to mature on February 15, 2020 and bear interest at a fixed rate of 6.00 percent per year, payable semi-annually in arrears on February 15 and August 15 of each year, beginning on August 15, 2015. In August 2016, we entered into multiple privately negotiated agreements, pursuant to which all of our 6.00% Notes were canceled, and the indenture, by and between us and U.S. Bank National Association, pursuant to which the 6.00% Notes were issued, was satisfied and discharged. In connection with these privately negotiated agreements, we issued a total of 34,659,972 shares of our common stock and made total cash payments of $4.7 million . • On August 8, 2016, we entered into a privately negotiated agreement pursuant to which we (i) issued 12,051,282 shares of our common stock, and (ii) made a cash payment equal to $4.7 million during August 2016 in exchange for approximately $23.5 million aggregate principal amount of our 6.00% Notes. • On August 9, 2016, we entered into privately negotiated agreements pursuant to which we agreed to issue (i) an aggregate of 20,564,101 shares of our common stock, plus (ii) a to be determined number of additional shares of our common stock based on certain formulaic consideration in exchange for $40.1 million aggregate principal amount of our 6.00% Notes. On August 12, 2016, including the additional shares of common stock, we issued an aggregate of 21,852,477 shares of our common stock. • On August 18, 2016, we entered into privately negotiated agreements, pursuant to which, on August 22, 2016, we issued an aggregate of 756,213 shares of our common stock, in exchange for $1.4 million aggregate principal amount of our 6.00% Notes. Pursuant to the terms of the indenture governing the 6.00% Notes, we recorded an interest make-whole charge of $5.9 million in interest (income) expense, net, in the condensed consolidated statements of operations for the six months ended December 31, 2016 , which was settled with a combination of common stock issuances and cash payments. We also recorded an induced conversion expense of $7.4 million , which we recorded in interest (income) expense, net, in the condensed consolidated statements of operations for the six months ended December 31, 2016 . Silicon Valley Bank Credit Facility On March 28, 2014, we entered into a loan and security agreement (the “Loan Agreement”) with Silicon Valley Bank (the “Bank”) pursuant to which the Bank provided us with a three -year revolving credit facility of up to $40.0 million . Under the Loan Agreement, advances are available based on up to 80 percent of “eligible accounts” as defined in the Loan Agreement. The Loan Agreement has a $10.0 million sub-facility for letters of credit, foreign exchange contracts and cash management services. Borrowings made under the Loan Agreement bear interest at a rate based on either the London Interbank Offered Rate plus 2.25 percent or Wall Street Journal’s prime rate plus 1.00 percent . If the sum of (a) our unrestricted cash and cash equivalents that are subject to the Bank’s liens less (b) the amount outstanding to the Bank under the Loan Agreement (such sum being “Net Cash”) is less than $15.0 million , then the interest rates are increased by 0.75 percent until Net Cash exceeds $15.0 million for a calendar month. If interest paid under the Loan Agreement is less than $45,000 in any fiscal quarter, we are required to pay the Bank an additional amount equal to the difference between $45,000 and the actual interest paid during such fiscal quarter. The minimum interest payment is in lieu of a stand-by charge. If the Loan Agreement terminates prior to its maturity date, we will pay a termination fee equal to 1.00 percent of the total credit facility if such termination occurs in the first year after closing, 0.75 percent of the total credit facility if such termination occurs in the second year after closing and 0.50 percent of the total credit facility if such termination occurs in the third year after closing. The maturity date of the Loan Agreement is March 28, 2017. At December 31, 2016 and July 2, 2016 , there were no amounts outstanding under the Loan Agreement.

POST-RETIREMENT BENEFITS

POST-RETIREMENT BENEFITS	6 Months Ended
	Dec. 31, 2016
Compensation and Retirement Disclosure [Abstract]
POST-RETIREMENT BENEFITS	POST-RETIREMENT BENEFITS We maintain a defined contribution plan and a defined benefit plan that provide retirement benefits to our employees in Japan. We also contribute to a U.K. based defined contribution pension scheme for employees. Japan Defined Contribution Plan Under the defined contribution plan in Japan, contributions are provided based on grade level and totaled $0.1 million and $0.3 million for the three and six months ended December 31, 2016 , respectively and $0.1 million and $0.2 million for the three and six months ended December 26, 2015 , respectively. Employees can elect to receive the benefit as additional salary or contribute the benefit to the plan on a tax-deferred basis. Japan Defined Benefit Plan Under the defined benefit plan in Japan (the “Japan Plan”), we calculate benefits based on an employee’s individual grade level and years of service. Employees are entitled to a lump sum benefit upon retirement or upon certain instances of termination. As of December 31, 2016 , there were no plan assets associated with the Japan Plan. As of December 31, 2016 , there was $0.1 million in accrued expenses and other liabilities and $6.2 million in other non-current liabilities in our condensed consolidated balance sheet to account for the projected benefit obligations under the Japan Plan. Net periodic pension costs for the Japan Plan included the following: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) Service cost $ 152 $ 122 $ 324 $ 244 Interest cost 1 11 2 21 Net periodic pension costs $ 153 $ 133 $ 326 $ 265 We made benefit payments under the Japan Plan of $0.1 million and $0.2 million during the three and six months ended December 31, 2016 , respectively, and zero and $0.1 million during the three and six months ended December 26, 2015 , respectively. U.K. Defined Contribution Pension Scheme Under the defined contribution pension scheme, contributions totaled $0.3 million and $0.5 million for the three and six months ended December 31, 2016 , respectively, and $0.3 million and $0.6 million for the three and six months ended December 26, 2015 , respectively.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Dec. 31, 2016
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Loss Contingencies We are involved in various lawsuits, claims, and proceedings that arise in the ordinary course of business. We record a loss provision when we believe it is both probable that a liability has been incurred and the amount can be reasonably estimated. Guarantees We indemnify our directors and certain employees as permitted by law, and have entered into indemnification agreements with our directors and executive officers. We have not recorded a liability associated with these indemnification arrangements, as we historically have not incurred any material costs associated with such indemnification obligations. Costs associated with such indemnification obligations may be mitigated by insurance coverage that we maintain, however, such insurance may not cover any, or may cover only a portion of, the amounts we may be required to pay. In addition, we may not be able to maintain such insurance coverage in the future. We also have indemnification clauses in various contracts that we enter into in the normal course of business, such as indemnifications in favor of customers in respect of liabilities they may incur as a result of purchasing our products should such products infringe the intellectual property rights of a third party. We have not historically paid out any material amounts related to these indemnifications; therefore, no accrual has been made for these indemnifications. Warranty Accrual We generally provide a warranty for our products for twelve months to thirty-six months from the date of sale, although warranties for certain of our products may be longer. We accrue for the estimated costs to provide warranty services at the time revenue is recognized. Our estimate of costs to service our warranty obligations is based on historical experience and expectation of future conditions. To the extent we experience increased warranty claim activity or increased costs associated with servicing those claims, our warranty costs would increase, resulting in a decrease in gross profit. The following table summarizes movements in the warranty accrual for the periods indicated: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) Warranty provision—beginning of period $ 4,600 $ 3,168 $ 3,827 $ 2,932 Warranties issued 437 353 1,542 857 Warranties utilized or expired (371 ) (435 ) (655 ) (688 ) Currency translation and other adjustments (106 ) 11 (154 ) (4 ) Warranty provision—end of period $ 4,560 $ 3,097 $ 4,560 $ 3,097 Capital Leases In connection with our acquisition of Opnext, Inc. in 2012, we assumed certain capital leases for certain equipment. The terms of the leases generally range from one to five years and the equipment can be purchased at the residual value upon expiration. We can terminate the leases at our discretion in return for a penalty payment as stated in the lease contracts. In October 2015, we entered into a capital lease agreement for certain capital equipment. The lease term is for 5 years, after which time the ownership of the equipment will transfer from lessor to us. During the lease term, we will make twenty equal installments of principal and interest, payable quarterly. Interest on the capital lease will accrue at 1.15 percent per annum. The following table shows the future minimum lease payments due under non-cancelable capital leases at December 31, 2016 : Capital Leases (Thousands) Fiscal Year Ending: 2017 (remaining) $ 1,641 2018 1,172 2019 569 2020 604 2021 276 Thereafter 13 Total minimum lease payments 4,275 Less amount representing interest (271 ) Present value of capitalized payments 4,004 Less: current portion (2,425 ) Long-term portion $ 1,579 Purchase Commitments We purchase components from a variety of suppliers and use contract manufacturers to provide manufacturing services for our products. During the normal course of business, in order to manage manufacturing lead times and help ensure adequate component supply, we enter into agreements with suppliers and contract manufacturers that either allow them to procure inventory based upon criteria as defined by us or establish the parameters defining our requirements. A significant portion of our reported purchase commitments arising from these agreements consist of firm, non-cancelable and unconditional commitments. We record a liability for firm, non-cancelable and unconditional purchase commitments for quantities in excess of our future demand forecasts consistent with the valuation of our excess and obsolete inventory. As of December 31, 2016 and July 2, 2016 , the liability for these purchase commitments was $2.6 million and $1.7 million , respectively, and was included in accrued expenses and other liabilities in our condensed consolidated balance sheets. Malaysian Goods and Services Tax (“GST”) In February 2016, the Malaysian tax authorities preliminarily denied our Malaysia GST refund claims representing approximately $2.4 million . These claims were made in connection with the export of finished goods from our contract manufacturing partner’s Malaysian facilities. We are currently contesting the denial of these claims, and believe that additional appeal options may be available to us if we do not obtain a favorable resolution. Although we have taken action to minimize the impact of the GST with respect to our ongoing operations, we believe it is reasonably possible that, ultimately, we may not be able to recover these GST amounts. We have accounted for the $2.4 million GST claims as a receivable classified in prepaid expenses and other current assets in our condensed consolidated balance sheet at December 31, 2016 . Litigation Overview In the ordinary course of business, we are involved in various legal proceedings, and we anticipate that additional actions will be brought against us in the future. The most significant of these proceedings are described below. These legal proceedings, as well as other matters, involve various aspects of our business and a variety of claims in various jurisdictions. Complex legal proceedings frequently extend for several years, and a number of the matters pending against us are at very early stages of the legal process. As a result, some pending matters have not yet progressed sufficiently through discovery and/or development of important factual information and legal issues to enable us to determine whether the proceeding is material to us or to estimate a range of possible loss, if any. Unless otherwise disclosed, we are unable to estimate the possible loss or range of loss for the legal proceeding described below. While it is not possible to accurately predict or determine the eventual outcome of this item, an adverse determination in the item currently pending could have a material adverse effect on our results of operations, financial position or cash flows. Kunst Worker Compensation Matter On June 18, 2015, Gerald Kunst, or Kunst, filed a civil suit against us and Travelers Property Casualty Company of America, or Travelers, in Massachusetts Superior Court, Civil Action No. SUCV2015-01818F. Travelers is our general liability insurance carrier. The complaint filed by Kunst, an employee of a third party service provider, alleges that he was injured while performing air conditioning repair services on the premises of our Acton, Massachusetts facility and seeks judgment in an amount to be determined by the court or jury, together with interest and costs. On July 24, 2015, we filed an answer to the complaint, which included our affirmative defenses. A pretrial conference is scheduled for April 12, 2017. We intend to vigorously defend against this litigation.

EMPLOYEE STOCK PLANS

EMPLOYEE STOCK PLANS	6 Months Ended
	Dec. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
EMPLOYEE STOCK PLANS	EMPLOYEE STOCK PLANS Stock Incentive Plans On November 18, 2016, our stockholders approved an amendment to the Fifth Amended and Restated 2001 Long-Term Stock Incentive Plan (the "Plan"), adding 6.0 million shares of common stock to the share reserve under the Plan. As of December 31, 2016 , there were approximately 13.9 million shares of our common stock available for grant under the Plan. We generally grant stock options that vest over a two to four year service period, and restricted stock awards and restricted stock unit ("RSU") awards that vest over a one to four year service period, and in certain cases each may vest earlier based upon the achievement of specific performance-based objectives as set by our board of directors or the compensation committee of our board of directors. Performance Stock Units In August 2015, our board of directors approved a grant of 0.9 million performance-based restricted stock units ("PSUs") to certain executive officers with an aggregate estimated grant date fair value of $2.5 million . Subject to the achievement of positive free cash flow (defined as adjusted EBITDA less capital expenditures) in any fiscal quarter ending prior to June 30, 2018, vesting of these PSUs is contingent upon service conditions being met through August 10, 2018. On October 29, 2015, the compensation committee of our board of directors certified that this performance condition was achieved during the first quarter of fiscal year 2016. As a result, these PSUs cliff vested with respect to 33.4 percent of the underlying shares on August 10, 2016, and will vest with respect to 8.325 percent of the underlying shares each subsequent quarter over the following two years , subject to continuous service. In August 2016, our board of directors approved a grant of 0.8 million PSUs to certain executive officers with an aggregate estimated grant date fair value of $4.8 million . Subject to the achievement of an aggregate of $25.0 million or more of free cash flow (defined as adjusted EBITDA less capital expenditures delivered) over any consecutive four fiscal quarters ending on or before June 27, 2020, as determined by our board of directors, these PSUs will vest with respect to 25 percent of the shares subject to the PSUs on August 10, 2017, and with respect to 6.25 percent of the underlying shares each subsequent quarter over the following three years, subject to continuous service. Restricted Stock Units In July 2015, our board of directors approved a long term incentive grant of 0.9 million RSUs to certain executive officers and 1.5 million RSUs to other employees, which vest over three years. In August 2016, our board of directors approved a long term incentive grant of 0.8 million RSUs to certain executive officers and 2.0 million RSUs to other employees, which vest over four years. Stock Incentive Plan Activity The following table summarizes the combined activity under all of our equity incentive plans for the six months ended December 31, 2016 : Shares Available For Grant Stock Options / SARs Outstanding Weighted- Average Exercise Price Time and Performance-based Restricted Stock Awards / Units Outstanding Weighted- Average Grant Date Fair Value (Thousands) (Thousands) (Thousands) Balance at July 2, 2016 12,824 2,975 $ 7.03 5,022 $ 2.67 Increase in share reserve 6,000 — — — — Granted (5,221 ) — — 3,729 6.33 Exercised or released — (504 ) 5.10 (2,388 ) 2.45 Forfeited or expired 287 (62 ) 15.50 (80 ) 4.63 Balance at December 31, 2016 13,890 2,409 $ 7.19 6,283 $ 4.90 Supplemental disclosure information about our stock options and stock appreciation rights ("SARs") outstanding as of December 31, 2016 is as follows: Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Life Aggregate Intrinsic Value (Thousands) (Years) (Thousands) Options and SARs exercisable 2,269 $ 7.49 3.2 $ 6,848 Options and SARs outstanding 2,409 $ 7.19 3.4 $ 7,768 The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value, based on the closing price of our common stock of $8.95 on December 30, 2016, which would have been received by the option holders had all option holders exercised their options as of that date. There were approximately 1.6 million shares of common stock subject to in-the-money options which were exercisable as of December 31, 2016 . We settle employee stock option exercises with newly issued shares of common stock.

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	6 Months Ended
	Dec. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
STOCK-BASED COMPENSATION	STOCK-BASED COMPENSATION We recognize stock-based compensation expense in our condensed consolidated statement of operations related to all share-based awards, including grants of stock options, based on the grant date fair value of such share-based awards. As there were no stock options granted during the three and six months ended December 31, 2016 and December 26, 2015, the Black-Scholes assumptions used to value stock option grants is not applicable. The amounts included in cost of revenues and operating expenses for stock-based compensation were as follows: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) Stock-based compensation by category of expense: Cost of revenues $ 462 $ 472 $ 751 $ 928 Research and development 526 491 983 915 Selling, general and administrative 1,601 1,580 3,298 2,524 $ 2,589 $ 2,543 $ 5,032 $ 4,367 Stock-based compensation by type of award: Stock options $ 32 $ 53 $ 70 $ 115 Restricted stock awards 2,612 2,535 5,203 4,296 Inventory adjustment to cost of revenues (55 ) (45 ) (241 ) (44 ) $ 2,589 $ 2,543 $ 5,032 $ 4,367 As of December 31, 2016 and July 2, 2016 , we had capitalized approximately $0.6 million and $0.3 million , respectively, of stock-based compensation as inventory. As of December 31, 2016 , we had capitalized approximately $0.1 million of stock-based compensation in connection with the development of internal use software. As of December 31, 2016 , we had $0.2 million in unrecognized stock-based compensation expense related to unvested stock options, net of estimated forfeitures, that will be recognized over a weighted-average period of 1.5 years , and $18.5 million in unrecognized stock-based compensation expense related to unvested time-based restricted stock awards, net of estimated forfeitures, that will be recognized over a weighted-average period of 2.5 years . The amount of stock-based compensation expense recognized in any one period related to PSUs can vary based on the achievement or anticipated achievement of the performance conditions. If the performance conditions are not met or not expected to be met, no compensation cost would be recognized on the shares underlying the PSUs, and any previously recognized compensation expense related to those PSUs would be reversed. As of December 31, 2016 , we determined that the achievement of the performance conditions associated with the PSUs issued in August 2016 is probable at 100 percent of the target level. During the three and six months ended December 31, 2016 , we recorded $0.6 million and $1.2 million , respectively, in stock-based compensation in connection with the PSUs issued in August 2015 and August 2016. During the three and six months ended December 26, 2015 , we recorded $0.8 million and $1.0 million , respectively in stock-based compensation expense in connection with the issuance of PSUs.

INCOME TAXES

INCOME TAXES	6 Months Ended
	Dec. 31, 2016
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES The income tax provision of $37,000 and $0.4 million for the three and six months ended December 31, 2016 , respectively, relates primarily to our foreign operations, which included a $0.5 million release of a reserve in Italy due to the expiration of the applicable statute of limitations. The income tax provision of $1.0 million and $1.9 million for the three and six months ended December 26, 2015 , respectively, relates primarily to our foreign operations. The total amount of our unrecognized tax benefits as of December 31, 2016 and July 2, 2016 were approximately $3.5 million and $3.8 million , respectively. As of December 31, 2016 , we had $2.9 million of unrecognized tax benefits that, if recognized, would affect our effective tax rate. While it is often difficult to predict the final outcome of any particular uncertain tax position, we believe that unrecognized tax benefits could decrease by approximately $0.6 million in the next twelve months.

NET INCOME (LOSS) PER SHARE

NET INCOME (LOSS) PER SHARE	6 Months Ended
	Dec. 31, 2016
Earnings Per Share [Abstract]
NET INCOME (LOSS) PER SHARE	NET INCOME (LOSS) PER SHARE Basic net income (loss) per share is computed using only the weighted-average number of shares of common stock outstanding for the applicable period, while diluted net income (loss) per share is computed assuming conversion of all potentially dilutive securities, such as stock options, unvested restricted stock units and awards, warrants and convertible notes during such period. The following table presents the calculation of basic and diluted net income (loss) per share: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands, except per share amounts) Net income (loss) $ 30,267 $ 157 $ 33,618 $ (3,353 ) Weighted-average shares - Basic 165,822 110,296 149,151 109,877 Effect of dilutive potential common shares from: Stock options and stock appreciation rights 752 82 724 — Restricted stock units and awards 2,282 2,016 2,420 — Convertible notes — — 7,506 — Weighted-average shares - Diluted 168,856 112,394 159,801 109,877 Basic net income (loss) per share $ 0.18 $ — $ 0.23 $ (0.03 ) Diluted net income (loss) per share $ 0.18 $ — $ 0.21 $ (0.03 ) For the three and six months ended December 31, 2016 , we excluded 0.8 million and 0.8 million , respectively, of outstanding stock options, stock appreciation rights and unvested restricted stock awards from the calculation of diluted net income (loss) per share because their effect would have been anti-dilutive. For the three and six months ended December 26, 2015 , we excluded 36.2 million and 39.9 million , respectively, of outstanding stock options, stock appreciation rights, unvested restricted stock awards and shares issuable in connection with convertible notes from the calculation of diluted net income (loss) per share because their effect would have been anti-dilutive.

GEOGRAPHIC INFORMATION, PRODUCT

GEOGRAPHIC INFORMATION, PRODUCT GROUPS AND CUSTOMER CONCENTRATION INFORMATION	6 Months Ended
	Dec. 31, 2016
Segment Reporting [Abstract]
GEOGRAPHIC INFORMATION, PRODUCT GROUPS AND CUSTOMER CONCENTRATION INFORMATION	GEOGRAPHIC INFORMATION, PRODUCT GROUPS AND CUSTOMER CONCENTRATION INFORMATION Geographic Information The following table shows revenues by geographic area based on the delivery locations of our products: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) Asia-Pacific: China $ 63,927 $ 35,179 $ 122,669 $ 68,235 Thailand 32,184 403 54,130 763 Malaysia 5,377 8,307 11,704 16,160 Other Asia-Pacific 3,028 903 6,364 1,915 Total Asia-Pacific $ 104,516 $ 44,792 $ 194,867 $ 87,073 Americas: United States 17,281 16,916 31,742 29,967 Mexico 8,068 14,196 17,359 26,534 Other Americas 6,211 1,821 8,213 2,975 Total Americas $ 31,560 $ 32,933 $ 57,314 $ 59,476 EMEA: Italy 6,718 6,818 16,024 13,889 Germany 3,088 4,010 6,377 8,952 Other EMEA 6,084 4,232 11,346 9,323 Total EMEA $ 15,890 $ 15,060 33,747 32,164 Japan $ 1,948 $ 1,344 3,478 2,966 Total revenues $ 153,914 $ 94,129 $ 289,406 $ 181,679 Product Groups The following table sets forth revenues by product group: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) 100 Gb/s transmission modules $ 113,835 $ 49,554 $ 211,606 $ 90,382 40 Gb/s and lower transmission modules 40,079 44,575 77,800 91,297 $ 153,914 $ 94,129 $ 289,406 $ 181,679 Significant Customers and Concentration of Credit Risk For the three months ended December 31, 2016 , four customers accounted for 10 percent or more of our revenues, representing approximately 22 percent , 20 percent , 16 percent and 10 percent of our revenues, respectively. For the six months ended December 31, 2016 four customers accounted for 10 percent of more of our revenues, representing 20 percent , 19 percent , 18 percent and 11 percent of our revenues, respectively. For the three months ended December 26, 2015 , three customers accounted for 10 percent or more of our revenues, representing approximately 21 percent , 16 percent and 10 percent of our revenues, respectively. For the six months ended December 26, 2015, three customers accounted for 10 percent or more of our revenues, representing approximately 19 percent , 16 percent and 10 percent of our revenues, respectively. As of December 31, 2016 , three customers accounted for 10 percent or more of our accounts receivable, representing approximately 23 percent , 18 percent and 16 percent of our accounts receivable, respectively. As of July 2, 2016 , four customers accounted for 10 percent or more of our accounts receivable, representing approximately 23 percent , 16 percent , 13 percent and 10 percent of our accounts receivable, respectively.

BASIS OF PREPARATION (Policies)

BASIS OF PREPARATION (Policies)	6 Months Ended
	Dec. 31, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation Oclaro, Inc., a Delaware corporation, is sometimes referred to in this Quarterly Report on Form 10-Q as “Oclaro,” “we,” “us” or “our.” The accompanying unaudited condensed consolidated financial statements of Oclaro as of December 31, 2016 and for the three and six months ended December 31, 2016 and December 26, 2015 have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Article 10 of Securities and Exchange Commission ("SEC") Regulation S-X, and include the accounts of Oclaro and all of our subsidiaries. Accordingly, they do not include all of the information and footnotes required by such accounting principles for annual financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our consolidated financial position and results of operations have been included. The condensed consolidated results of operations for the three and six months ended December 31, 2016 are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year ending July 1, 2017 . The condensed consolidated balance sheet as of July 2, 2016 has been derived from our audited financial statements as of such date, but does not include all disclosures required by U.S. GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with our audited financial statements included in our Annual Report on Form 10-K for the year ended July 2, 2016 (" 2016 Form 10-K").
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reported periods. Examples of significant estimates and assumptions made by management involve the fair value of other intangible assets and long-lived assets, valuation allowances for deferred tax assets, the fair value of stock-based compensation, the fair value of embedded derivatives related to convertible debt, the fair value of pension liabilities, estimates for allowances for doubtful accounts and valuation of excess and obsolete inventories. These judgments can be subjective and complex and consequently actual results could differ materially from those estimates and assumptions. Descriptions of the key estimates and assumptions are included in our 2016 Form 10-K.
Fiscal Years	Fiscal Years We operate on a 52/53 week year ending on the Saturday closest to June 30. Our fiscal year ending July 1, 2017 will be a 52 week year, with the quarter ended December 31, 2016 being a 13 week quarterly period. Our fiscal year ended July 2, 2016 was a 53 week year, with the quarter ended December 26, 2015 being a 13 week quarterly period.
Reclassifications	Reclassifications For presentation purposes, we have reclassified certain prior period amounts to conform to the current period financial statement presentation. These reclassifications did not affect our consolidated revenues, net loss, cash flows, cash and cash equivalents or stockholders’ equity as previously reported.
Recent Accounting Standards	RECENT ACCOUNTING STANDARDS In November 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-18, Statement of Cash Flows: Restricted Cash to standardize the presentation of transfers between cash and restricted cash in the cash flow statement. Amounts described as restricted cash should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The guidance will be effective for us in the first quarter of fiscal 2019, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory , to reduce the complexity related to the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. This guidance will be effective for us in the first quarter of fiscal 2019, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments to reduce the diversity in practice related to the presentation and classification of various cash flow scenarios. This guidance will be effective for us in the first quarter of fiscal 2019, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In May 2014 and May 2016, the FASB issued ASU 2014-09, Revenue from Contracts with Customers and ASU 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients , respectively. These updates clarify the principles for recognizing revenue and develop a common revenue standard for GAAP and International Financial Reporting Standards. The standard 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. This guidance will be effective for us in the first quarter of fiscal 2019, with early adoption permitted for periods beginning after December 15, 2016. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In March 2016, the FASB issued ASU No. 2016-09, Compensation: Improvements to Employee Share-Based Payment Accounting , which simplifies several aspects of the accounting for employee share-based payment transactions, including the income tax consequences, classification of awards, and classification on the statement of cash flows. This guidance will be effective for us in the first quarter of fiscal 2018, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures. In February 2016, the FASB issued ASU No. 2016-02, Leases , which requires recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This guidance will be effective for us in the first quarter of fiscal 2020, with early adoption permitted. We are currently evaluating the impact that the implementation of this standard will have on our financial statements and footnote disclosures.

BALANCE SHEET DETAILS (Tables)

BALANCE SHEET DETAILS (Tables)	6 Months Ended
	Dec. 31, 2016
Balance Sheet Details [Abstract]
Schedule of Cash and Cash Equivalents	The following table provides details regarding our cash, cash equivalents and short-term investments at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Cash and cash equivalents: Cash-in-bank $ 49,806 $ 70,925 Money market funds 157,627 25,004 Commercial paper 11,489 — Corporate bonds 3,874 — $ 222,796 $ 95,929 Short-term investments: Commercial paper $ 15,947 $ — Corporate bonds 4,001 — $ 19,948 $ —
Schedule of Inventories	The following table provides details regarding our inventories at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Inventories: Raw materials $ 26,649 $ 23,751 Work-in-process 32,458 32,819 Finished goods 23,206 19,799 $ 82,313 $ 76,369
Schedule of Property and Equipment, Net	The following table provides details regarding our property and equipment, net at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Property and equipment, net: Buildings and improvements $ 9,787 $ 10,389 Plant and machinery 73,064 59,696 Fixtures, fittings and equipment 2,904 3,005 Computer equipment 9,016 9,846 94,771 82,936 Less: Accumulated depreciation (13,369 ) (17,891 ) $ 81,402 $ 65,045
Summary of Other Intangible Assets	The following table summarizes the activity related to our other intangible assets for the six months ended December 31, 2016 : Core and Development Customer Patent Other Amortization Total (Thousands) Balance at July 2, 2016 $ 6,249 $ 4,509 $ 2,402 $ 915 $ 3,338 $ (15,915 ) $ 1,498 Amortization — — — — — (485 ) (485 ) Translations and adjustments — (27 ) — — — — (27 ) Balance at December 31, 2016 $ 6,249 $ 4,482 $ 2,402 $ 915 $ 3,338 $ (16,400 ) $ 986
Schedule of Accrued Expenses and Other Liabilities	The following table presents details regarding our accrued expenses and other liabilities at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Accrued expenses and other liabilities: Trade payables $ 8,831 $ 6,429 Compensation and benefits related accruals 15,260 14,038 Warranty accrual 4,560 3,827 Accrued restructuring, current — 204 Purchase commitments in excess of future demand, current 2,625 1,723 Other accruals 9,094 8,597 $ 40,370 $ 34,818
Components of Accumulated Other Comprehensive Income	The following table presents the components of accumulated other comprehensive income at the dates indicated: December 31, 2016 July 2, 2016 (Thousands) Accumulated other comprehensive income: Currency translation adjustments $ 36,939 $ 40,184 Unrealized gain on marketable securities 5 — Japan defined benefit plan (363 ) (363 ) $ 36,581 $ 39,821

FAIR VALUE (Tables)

FAIR VALUE (Tables)	6 Months Ended
	Dec. 31, 2016
Fair Value Disclosures [Abstract]
Assets and Liabilities Measured at Fair Value on Recurring Basis	Assets and liabilities measured at fair value on a recurring basis are shown in the table below by their corresponding balance sheet caption and consisted of the following types of instruments at December 31, 2016 and July 2, 2016 : Fair Value Measurement at December 31, 2016 Using Quoted Prices Significant Significant Total (Thousands) Assets: Cash and cash equivalents: (1) Money market funds $ 157,627 $ — $ — $ 157,627 Commercial paper — 11,489 — 11,489 Corporate bonds — 3,873 — 3,873 Short-term investments: Commercial paper — 15,947 — 15,947 Corporate bonds — 4,001 — 4,001 Restricted cash: Money market funds 712 — — 712 Total assets measured at fair value $ 158,339 $ 35,310 $ — $ 193,649 (1) Excludes $49.8 million in cash held in our bank accounts at December 31, 2016 . Fair Value Measurement at July 2, 2016 Using Quoted Prices Significant Significant Total (Thousands) Assets: Cash and cash equivalents: (1) Money market funds $ 25,004 $ — $ — $ 25,004 Restricted cash: Money market funds 712 — — 712 Total assets measured at fair value $ 25,716 $ — $ — $ 25,716 (1) Excludes $70.9 million in cash held in our bank accounts at July 2, 2016 .

POST-RETIREMENT BENEFITS (Table

POST-RETIREMENT BENEFITS (Tables)	6 Months Ended
	Dec. 31, 2016
Compensation and Retirement Disclosure [Abstract]
Schedule of Net Periodic Pension Costs	Net periodic pension costs for the Japan Plan included the following: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) Service cost $ 152 $ 122 $ 324 $ 244 Interest cost 1 11 2 21 Net periodic pension costs $ 153 $ 133 $ 326 $ 265

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	6 Months Ended
	Dec. 31, 2016
Commitments and Contingencies Disclosure [Abstract]
Movements in Warranty Accrual for Period	The following table summarizes movements in the warranty accrual for the periods indicated: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) Warranty provision—beginning of period $ 4,600 $ 3,168 $ 3,827 $ 2,932 Warranties issued 437 353 1,542 857 Warranties utilized or expired (371 ) (435 ) (655 ) (688 ) Currency translation and other adjustments (106 ) 11 (154 ) (4 ) Warranty provision—end of period $ 4,560 $ 3,097 $ 4,560 $ 3,097
Summary of Future Minimum Lease Payments Due under Non-cancelable Capital Leases	The following table shows the future minimum lease payments due under non-cancelable capital leases at December 31, 2016 : Capital Leases (Thousands) Fiscal Year Ending: 2017 (remaining) $ 1,641 2018 1,172 2019 569 2020 604 2021 276 Thereafter 13 Total minimum lease payments 4,275 Less amount representing interest (271 ) Present value of capitalized payments 4,004 Less: current portion (2,425 ) Long-term portion $ 1,579

EMPLOYEE STOCK PLANS (Tables)

EMPLOYEE STOCK PLANS (Tables)	6 Months Ended
	Dec. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Summary of Combined Activity Under All of Our Equity Incentive Plans	The following table summarizes the combined activity under all of our equity incentive plans for the six months ended December 31, 2016 : Shares Available For Grant Stock Options / SARs Outstanding Weighted- Average Exercise Price Time and Performance-based Restricted Stock Awards / Units Outstanding Weighted- Average Grant Date Fair Value (Thousands) (Thousands) (Thousands) Balance at July 2, 2016 12,824 2,975 $ 7.03 5,022 $ 2.67 Increase in share reserve 6,000 — — — — Granted (5,221 ) — — 3,729 6.33 Exercised or released — (504 ) 5.10 (2,388 ) 2.45 Forfeited or expired 287 (62 ) 15.50 (80 ) 4.63 Balance at December 31, 2016 13,890 2,409 $ 7.19 6,283 $ 4.90
Supplemental Disclosure Information About Stock Options and SAR's Outstanding	Supplemental disclosure information about our stock options and stock appreciation rights ("SARs") outstanding as of December 31, 2016 is as follows: Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Life Aggregate Intrinsic Value (Thousands) (Years) (Thousands) Options and SARs exercisable 2,269 $ 7.49 3.2 $ 6,848 Options and SARs outstanding 2,409 $ 7.19 3.4 $ 7,768

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	6 Months Ended
	Dec. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Amounts Included in Cost of Revenues and Operating Expenses for Stock-Based Compensation	The amounts included in cost of revenues and operating expenses for stock-based compensation were as follows: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) Stock-based compensation by category of expense: Cost of revenues $ 462 $ 472 $ 751 $ 928 Research and development 526 491 983 915 Selling, general and administrative 1,601 1,580 3,298 2,524 $ 2,589 $ 2,543 $ 5,032 $ 4,367 Stock-based compensation by type of award: Stock options $ 32 $ 53 $ 70 $ 115 Restricted stock awards 2,612 2,535 5,203 4,296 Inventory adjustment to cost of revenues (55 ) (45 ) (241 ) (44 ) $ 2,589 $ 2,543 $ 5,032 $ 4,367

NET INCOME (LOSS) PER SHARE Net

NET INCOME (LOSS) PER SHARE Net Income (Loss) Per Share (Tables)	6 Months Ended
	Dec. 31, 2016
Earnings Per Share [Abstract]
Schedule of Earnings Per Share	The following table presents the calculation of basic and diluted net income (loss) per share: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands, except per share amounts) Net income (loss) $ 30,267 $ 157 $ 33,618 $ (3,353 ) Weighted-average shares - Basic 165,822 110,296 149,151 109,877 Effect of dilutive potential common shares from: Stock options and stock appreciation rights 752 82 724 — Restricted stock units and awards 2,282 2,016 2,420 — Convertible notes — — 7,506 — Weighted-average shares - Diluted 168,856 112,394 159,801 109,877 Basic net income (loss) per share $ 0.18 $ — $ 0.23 $ (0.03 ) Diluted net income (loss) per share $ 0.18 $ — $ 0.21 $ (0.03 )

GEOGRAPHIC INFORMATION, PRODU27

GEOGRAPHIC INFORMATION, PRODUCT GROUPS AND CUSTOMER CONCENTRATION INFORMATION (Tables)	6 Months Ended
	Dec. 31, 2016
Segment Reporting [Abstract]
Revenues by Geographic Area	The following table shows revenues by geographic area based on the delivery locations of our products: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) Asia-Pacific: China $ 63,927 $ 35,179 $ 122,669 $ 68,235 Thailand 32,184 403 54,130 763 Malaysia 5,377 8,307 11,704 16,160 Other Asia-Pacific 3,028 903 6,364 1,915 Total Asia-Pacific $ 104,516 $ 44,792 $ 194,867 $ 87,073 Americas: United States 17,281 16,916 31,742 29,967 Mexico 8,068 14,196 17,359 26,534 Other Americas 6,211 1,821 8,213 2,975 Total Americas $ 31,560 $ 32,933 $ 57,314 $ 59,476 EMEA: Italy 6,718 6,818 16,024 13,889 Germany 3,088 4,010 6,377 8,952 Other EMEA 6,084 4,232 11,346 9,323 Total EMEA $ 15,890 $ 15,060 33,747 32,164 Japan $ 1,948 $ 1,344 3,478 2,966 Total revenues $ 153,914 $ 94,129 $ 289,406 $ 181,679
Revenues by Product Group	The following table sets forth revenues by product group: Three Months Ended Six Months Ended December 31, 2016 December 26, 2015 December 31, 2016 December 26, 2015 (Thousands) 100 Gb/s transmission modules $ 113,835 $ 49,554 $ 211,606 $ 90,382 40 Gb/s and lower transmission modules 40,079 44,575 77,800 91,297 $ 153,914 $ 94,129 $ 289,406 $ 181,679

BASIS OF PREPARATION (Details)

BASIS OF PREPARATION (Details) - USD ($) $ in Millions	Nov. 18, 2016	Sep. 27, 2016	Aug. 22, 2016	Aug. 12, 2016	Aug. 09, 2016	Aug. 08, 2016	Sep. 30, 2016	Aug. 31, 2016	Dec. 31, 2016	Oct. 31, 2015	Feb. 19, 2015
Debt Instrument [Line Items]
Stated interest rate (percent)										1.15%
Stock issued in September (shares)		15,000,000
Proceeds from issuance of common stock, net		$ 135.2					$ 135.2
Additional shares reserved under the Plan (shares)	6,000,000								6,000,000
Convertible Notes | 6.00% Convertible Senior Notes due 2020
Debt Instrument [Line Items]
Stated interest rate (percent)								6.00%			6.00%
Payment on 6% Notes						$ 4.7		$ 4.7
Common Stock
Debt Instrument [Line Items]
Shares issued in settlement of debt (shares)			756,213	21,852,477	20,564,101	12,051,282		34,659,972
Stock issued in September (shares)							17,250,000

BALANCE SHEET DETAILS - Schedul

BALANCE SHEET DETAILS - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Jul. 02, 2016	Dec. 26, 2015	Jun. 27, 2015
Cash and cash equivalents:
Cash-in-bank	$ 49,806	$ 70,925
Money market funds	157,627	25,004
Commercial paper	11,489	0
Corporate bonds	3,874	0
Total cash and cash equivalents	222,796	95,929	$ 114,058	$ 111,840
Short-term investments:
Commercial paper	15,947	0
Corporate bonds	4,001	0
Short-term Investments	$ 19,948	$ 0

BALANCE SHEET DETAILS - Sched30

BALANCE SHEET DETAILS - Schedule of Inventories (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Jul. 02, 2016
Inventories:
Raw materials	$ 26,649	$ 23,751
Work-in-process	32,458	32,819
Finished goods	23,206	19,799
Total inventories	$ 82,313	$ 76,369

BALANCE SHEET DETAILS - Sched31

BALANCE SHEET DETAILS - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Jul. 02, 2016
Property and equipment, net:
Buildings and improvements	$ 9,787	$ 10,389
Plant and machinery	73,064	59,696
Fixtures, fittings and equipment	2,904	3,005
Computer equipment	9,016	9,846
Property and equipment, gross	94,771	82,936
Less: Accumulated depreciation	(13,369)	(17,891)
Total property and equipment, net	$ 81,402	$ 65,045

BALANCE SHEET DETAILS - Summary

BALANCE SHEET DETAILS - Summary of Other Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Other Intangible Assets, Gross:
Translations and adjustments			$ (27)
Other Intangible Assets, Accumulated Amortization:
Beginning balance, Accumulated amortization			(15,915)
Amortization	$ (241)	$ (250)	(485)	$ (501)
Ending balance, Accumulated amortization	(16,400)		(16,400)
Other Intangible Assets, Net:
Beginning balance			1,498
Amortization	(241)	$ (250)	(485)	$ (501)
Translations and adjustments			(27)
Ending balance	986		986
Core and Current Technology
Other Intangible Assets, Gross:
Beginning balance			6,249
Translations and adjustments			0
Ending balance	6,249		6,249
Other Intangible Assets, Net:
Translations and adjustments			0
Development and Supply Agreements
Other Intangible Assets, Gross:
Beginning balance			4,509
Translations and adjustments			(27)
Ending balance	4,482		4,482
Other Intangible Assets, Net:
Translations and adjustments			(27)
Customer Relationships
Other Intangible Assets, Gross:
Beginning balance			2,402
Translations and adjustments			0
Ending balance	2,402		2,402
Other Intangible Assets, Net:
Translations and adjustments			0
Patent Portfolio
Other Intangible Assets, Gross:
Beginning balance			915
Translations and adjustments			0
Ending balance	915		915
Other Intangible Assets, Net:
Translations and adjustments			0
Other Intangibles
Other Intangible Assets, Gross:
Beginning balance			3,338
Translations and adjustments			0
Ending balance	$ 3,338		3,338
Other Intangible Assets, Net:
Translations and adjustments			$ 0

BALANCE SHEET DETAILS - Sched33

BALANCE SHEET DETAILS - Schedule of Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Jul. 02, 2016
Accrued expenses and other liabilities:
Trade payables	$ 8,831	$ 6,429
Compensation and benefits related accruals	15,260	14,038
Warranty accrual	4,560	3,827
Accrued restructuring, current	0	204
Purchase commitments in excess of future demand, current	2,625	1,723
Other accruals	9,094	8,597
Total accrued expenses and other liabilities	$ 40,370	$ 34,818

BALANCE SHEET DETAILS - Compone

BALANCE SHEET DETAILS - Components of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Jul. 02, 2016
Accumulated other comprehensive income:
Currency translation adjustments	$ 36,939	$ 40,184
Unrealized gain on marketable securities	5	0
Japan defined benefit plan	(363)	(363)
Accumulated other comprehensive income	$ 36,581	$ 39,821

BALANCE SHEET DETAILS - Additio

BALANCE SHEET DETAILS - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands

Sep. 27, 2016

Aug. 22, 2016

Aug. 12, 2016

Aug. 09, 2016

Aug. 08, 2016

Sep. 30, 2016

Aug. 31, 2016

Dec. 31, 2016

Sep. 21, 2016

Jul. 02, 2016

Oct. 31, 2015

Feb. 19, 2015

Balance Sheet Components [Line Items]

Restricted cash and cash equivalents

$ 1,100

Restricted cash, current

715

$ 715

Assets under capital lease

4,000

$ 5,900

Expected amortization of intangible assets in fiscal year 2017

300

Expected amortization of intangible assets in fiscal year 2018

$ 600

Stated interest rate (percent)

1.15%

Stock issued in September (shares)

15,000,000

Common stock, par value (in usd per share)

$ 0.01

$ 0.01

$ 0.01

Stock offering, price per share (in USD per share)

$ 8.35

Stock offering, underwriter option period

30 days

Proceeds from issuance of common stock, net

$ 135,200

$ 135,200

Other Current Assets [Member]

Balance Sheet Components [Line Items]

Restricted cash, current

$ 700

Other non-current assets

Balance Sheet Components [Line Items]

Restricted cash, noncurrent

$ 400

Common Stock

Balance Sheet Components [Line Items]

Shares issued in settlement of debt (shares)

756,213

21,852,477

20,564,101

12,051,282

34,659,972

Stock issued in September (shares)

17,250,000

Underwriter option

Balance Sheet Components [Line Items]

Stock issued in September (shares)

2,250,000

Convertible Notes | 6.00% Convertible Senior Notes due 2020

Balance Sheet Components [Line Items]

Stated interest rate (percent)

6.00%

6.00%

FAIR VALUE - Assets and Liabili

FAIR VALUE - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Jul. 02, 2016
Restricted cash:
Total assets measured at fair value	$ 193,649	$ 25,716
Cash held in bank accounts	49,806	70,925
Quoted Prices in Active Markets for Identical Assets (Level 1)
Restricted cash:
Total assets measured at fair value	158,339	25,716
Significant Other Observable Inputs (Level 2)
Restricted cash:
Total assets measured at fair value	35,310
Money Market Funds
Cash and cash equivalents:
Cash and cash equivalents	157,627	25,004
Money Market Funds | Quoted Prices in Active Markets for Identical Assets (Level 1)
Cash and cash equivalents:
Cash and cash equivalents	157,627	25,004
Commercial Paper
Cash and cash equivalents:
Cash and cash equivalents	11,489
Commercial Paper | Significant Other Observable Inputs (Level 2)
Cash and cash equivalents:
Cash and cash equivalents	11,489
Corporate Bonds
Cash and cash equivalents:
Cash and cash equivalents	3,873
Corporate Bonds | Significant Other Observable Inputs (Level 2)
Cash and cash equivalents:
Cash and cash equivalents	3,873
Corporate Bonds
Short-term investments:
Short-term investments	4,001
Corporate Bonds | Significant Other Observable Inputs (Level 2)
Short-term investments:
Short-term investments	4,001
Commercial Paper
Short-term investments:
Short-term investments	15,947
Commercial Paper | Significant Other Observable Inputs (Level 2)
Short-term investments:
Short-term investments	15,947
Money Market Funds
Restricted cash:
Restricted cash	712	712
Money Market Funds | Quoted Prices in Active Markets for Identical Assets (Level 1)
Restricted cash:
Restricted cash	$ 712	$ 712

CREDIT LINE AND NOTES - 6.00% C

CREDIT LINE AND NOTES - 6.00% Convertible Senior Notes (Details)	Aug. 22, 2016USD ($)shares	Aug. 12, 2016shares	Aug. 09, 2016USD ($)shares	Aug. 08, 2016USD ($)shares	Feb. 19, 2015USD ($)d	Aug. 31, 2016USD ($)shares	Dec. 31, 2016USD ($)	Oct. 31, 2015
Debt Instrument [Line Items]
Fixed interest rate								1.15%
Common Stock
Debt Instrument [Line Items]
Shares issued in settlement of debt (shares) | shares	756,213	21,852,477	20,564,101	12,051,282		34,659,972
Convertible Notes | 6.00% Convertible Senior Notes due 2020
Debt Instrument [Line Items]
Fixed interest rate					6.00%	6.00%
Principal value of the liability component	$ 1,400,000		$ 40,100,000	$ 23,500,000	$ 65,000,000
Percentage of stock price the Notes were sold					100.00%
Proceeds from the sale of convertible notes, net					$ 61,600,000
Unamortized value of the debt discount and issuance costs					3,400,000
Offering expenses					$ 600,000
Number of threshold trading days | d					20
Consecutive trading days					30 days
Threshold trading days					5 days
Payment on 6% Notes				$ 4,700,000		$ 4,700,000
Convertible Notes | 6.00% Convertible Senior Notes due 2020 | Interest Income (Expense), Net
Debt Instrument [Line Items]
Interest make-whole charge							$ 5,900,000
Convertible Notes | 6.00% Convertible Senior Notes due 2020 | Other Income (Expense), Net
Debt Instrument [Line Items]
Induced conversion expense							$ 7,400,000

CREDIT LINE AND NOTES - Silicon

CREDIT LINE AND NOTES - Silicon Valley Bank Credit Facility (Details) - Oclaro Technology Limited - Silicon Valley Bank - USD ($)	Mar. 28, 2014	Dec. 31, 2016	Jul. 02, 2016
Ceded Credit Risk [Line Items]
Minimum net cash required under Loan Agreement	$ 15,000,000
Increase in interest rate under Loan Agreement	0.75%
Minimum
Ceded Credit Risk [Line Items]
Interest paid under Loan Agreement	$ 45,000
LIBOR
Ceded Credit Risk [Line Items]
Basis spread on variable rate	2.25%
Prime Rate
Ceded Credit Risk [Line Items]
Basis spread on variable rate	1.00%
Loan Agreement
Ceded Credit Risk [Line Items]
Percentage of eligible accounts for advances	80.00%
Loan Agreement | First Year after Closing
Ceded Credit Risk [Line Items]
Termination fee, percent	1.00%
Loan Agreement | Second Year after Closing
Ceded Credit Risk [Line Items]
Termination fee, percent	0.75%
Loan Agreement | Third Year after Closing
Ceded Credit Risk [Line Items]
Termination fee, percent	0.50%
Loan Agreement | Revolving Credit Facility
Ceded Credit Risk [Line Items]
Debt term	3 years
Line of credit, maximum borrowing capacity	$ 40,000,000
Amounts outstanding under credit agreement		$ 0	$ 0
Loan Agreement | Letters of Credit, Foreign Exchange Contracts and Cash Management Services
Ceded Credit Risk [Line Items]
Line of credit, maximum borrowing capacity	$ 10,000,000

POST-RETIREMENT BENEFITS - Addi

POST-RETIREMENT BENEFITS - Additional Information (Details) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Defined Benefit Plan Disclosure [Line Items]
Contributions made under U.K. defined contribution pension scheme	$ 300,000	$ 300,000	$ 500,000	$ 600,000
Japan Plan
Defined Benefit Plan Disclosure [Line Items]
Total contribution provided	100,000	100,000	300,000	200,000
Plan assets			0
Accrued expenses and other liabilities	100,000		100,000
Other non current liabilities	6,200,000		6,200,000
Defined benefit plan, benefits paid	$ 100,000	$ 0	$ 200,000	$ 100,000

POST-RETIREMENT BENEFITS - Net

POST-RETIREMENT BENEFITS - Net Periodic Pension Costs (Details) - Japan Plan - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 152	$ 122	$ 324	$ 244
Interest cost	1	11	2	21
Net periodic pension costs	$ 153	$ 133	$ 326	$ 265

COMMITMENTS AND CONTINGENCIES -

COMMITMENTS AND CONTINGENCIES - Additional Information (Details) $ in Millions	1 Months Ended	6 Months Ended
	Oct. 31, 2015installment	Dec. 31, 2016USD ($)	Jul. 02, 2016USD ($)
Contingencies And Commitments [Line Items]
Capital lease term	5 years
Number of capital lease installment payments | installment	20
Interest rate on capital lease (percent)	1.15%
Prepaid Expenses and Other Current Assets
Contingencies And Commitments [Line Items]
Malaysian goods and services tax refund claim		$ 2.4
Inventory in Excess of Future Demand Forecasts | Accrued Expenses and Other Liabilities
Contingencies And Commitments [Line Items]
Purchase commitments		$ 2.6	$ 1.7
Minimum
Contingencies And Commitments [Line Items]
Warranty for products from date of sale		12 months
Maximum
Contingencies And Commitments [Line Items]
Warranty for products from date of sale		36 months
Opnext | Minimum
Contingencies And Commitments [Line Items]
Capital lease term		1 year
Opnext | Maximum
Contingencies And Commitments [Line Items]
Capital lease term		5 years

COMMITMENTS AND CONTINGENCIES42

COMMITMENTS AND CONTINGENCIES - Movements in Warranty Accrual for Period (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Warranty Provision Roll Forward:
Warranty provision—beginning of period	$ 4,600	$ 3,168	$ 3,827	$ 2,932
Warranties issued	437	353	1,542	857
Warranties utilized or expired	(371)	(435)	(655)	(688)
Currency translation and other adjustments	(106)	11	(154)	(4)
Warranty provision—end of period	$ 4,560	$ 3,097	$ 4,560	$ 3,097

COMMITMENTS AND CONTINGENCIES43

COMMITMENTS AND CONTINGENCIES - Summary of Future Minimum Lease Payments Due Under Non-Cancelable Capital Leases (Details) $ in Thousands	Dec. 31, 2016USD ($)
Fiscal Year Ending:
2017 (remaining)	$ 1,641
2,018	1,172
2,019	569
2,020	604
2,021	276
Thereafter	13
Total minimum lease payments	4,275
Less amount representing interest	(271)
Present value of capitalized payments	4,004
Less: current portion	(2,425)
Long-term portion	$ 1,579

EMPLOYEE STOCK PLANS - Addition

EMPLOYEE STOCK PLANS - Additional Information (Details) $ / shares in Units, $ in Millions	Nov. 18, 2016shares	Aug. 31, 2016USD ($)quartershares	Aug. 31, 2015USD ($)shares	Jul. 31, 2015shares	Dec. 31, 2016shares	Jul. 02, 2016shares	Sep. 25, 2015$ / shares
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Additional shares reserved under the Plan (shares)	6,000,000				6,000,000
Number of shares issued under the ESPP (shares)					13,890,000	12,824,000
Performance stock units, grants outstanding (in shares)					0
Closing price of common stock (in usd per share) | $ / shares							$ 8.95
Number of shares of common stock subject to in-the-money options (in shares)					1,600,000
Restricted Stock Awards / Units Outstanding
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Units outstanding after adjustments (in shares)					6,283,000	5,022,000
PSUs | Certain Executive Officers
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Award vesting period			2 years
Number of granted shares (shares)		777,500	915,000
Aggregate estimated grant date fair value of PSU | $		$ 4.8	$ 2.5
Number of consecutive fiscal quarters | quarter		4
Free cash flow requirement | $		$ 25
PSUs | Certain Executive Officers | August 10, 2016
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Percentage of shares that will vest					33.40%
PSUs | Certain Executive Officers | Subsequent Quarter Over the Next Two Years
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Percentage of shares that will vest					8.325%
PSUs | Certain Executive Officers | August 10, 2017
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Percentage of shares that will vest		25.00%
PSUs | Certain Executive Officers | Subsequent Quarter over Following Three Years
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Award vesting period		3 years
Percentage of shares that will vest		6.25%
RSUs
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Award vesting period		4 years		3 years
RSUs | Certain Executive Officers
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Number of granted shares (shares)		800,000		900,000
RSUs | Employees
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Number of granted shares (shares)		2,000,000		1,500,000
Minimum | Stock Options
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Award vesting period					2 years
Minimum | Restricted Stock Awards / Units Outstanding
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Award vesting period					1 year
Maximum | Stock Options
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Award vesting period					4 years
Maximum | Restricted Stock Awards / Units Outstanding
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Award vesting period					4 years

EMPLOYEE STOCK PLANS - Summariz

EMPLOYEE STOCK PLANS - Summarizes Combined Activity Under All of Our Equity Incentive Plans (Details) - $ / shares	Nov. 18, 2016	Dec. 31, 2016
Shares Available For Grant
Balance at beginning of period (in shares)		12,824,000
Increase in share reserve (shares)	6,000,000	6,000,000
Granted (in shares)		(5,221,000)
Exercised or released (in shares)		0
Forfeited or expired (in shares)		287,000
Balance at end of period (in shares)		13,890,000
Stock Options / SARs Outstanding
Balance at beginning of period (in shares)		2,975,000
Granted (in shares)		0
Exercised or released (in shares)		(504,000)
Forfeited or expired (in shares)		(62,000)
Balance at end of period (in shares)		2,409,000
Weighted- Average Exercise Price
Balance at beginning of period (in usd per share)		$ 7.03
Granted (in usd per share)		0
Exercised or released (in usd per share)		5.10
Forfeited or expired (in usd per share)		15.50
Balance at end of period (in usd per share)		7.19
Weighted- Average Grant Date Fair Value
Balance at beginning of period (in usd per share)		2.67
Granted (in usd per share)		6.33
Exercised or released (in usd per share)		2.45
Forfeited or expired (in usd per share)		4.63
Balance at end of period (in usd per share)		$ 4.90
Restricted Stock Awards / Units Outstanding
Time and Performance-based Restricted Stock Awards / Units Outstanding
Balance at beginning of period (in shares)		5,022,000
Granted (in shares)		3,729,000
Exercised or released (in shares)		(2,388,000)
Forfeited or expired (in shares)		(80,000)
Balance at end of period (in shares)		6,283,000

EMPLOYEE STOCK PLANS - Suppleme

EMPLOYEE STOCK PLANS - Supplemental Disclosure Information About Our Stock Options and SAR's Outstanding (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	6 Months Ended
	Dec. 31, 2016	Jul. 02, 2016
Schedule Of Stock Options [Line Items]
Shares, Options and SARs exercisable (shares)	1,600
Shares, Options and SARs outstanding (shares)	2,409	2,975
Weighted-Average Exercise Price, Options and SARs outstanding (in usd per share)	$ 7.19	$ 7.03
Stock options and SARs
Schedule Of Stock Options [Line Items]
Shares, Options and SARs exercisable (shares)	2,269
Shares, Options and SARs outstanding (shares)	2,409
Weighted-Average Exercise Price, Options and SARs exercisable (in usd per share)	$ 7.49
Weighted-Average Exercise Price, Options and SARs outstanding (in usd per share)	$ 7.19
Weighted-Average Remaining Contractual Life, Options and SARs exercisable	3 years 2 months 5 days
Weighted-Average Remaining Contractual Life, Options and SARs outstanding	3 years 4 months 13 days
Aggregate Intrinsic Value, Options and SARs exercisable	$ 6,848
Aggregate Intrinsic Value, Options and SARs outstanding	$ 7,768

STOCK-BASED COMPENSATION - Amou

STOCK-BASED COMPENSATION - Amounts Included in Cost of Revenues and Operating Expenses for Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated share-based compensation expense	$ 2,589	$ 2,543	$ 5,032	$ 4,367
Stock options
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated share-based compensation expense	32	53	70	115
Restricted stock awards
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated share-based compensation expense	2,612	2,535	5,203	4,296
Inventory adjustment to cost of revenues
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated share-based compensation expense	(55)	(45)	(241)	(44)
Cost of revenues
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated share-based compensation expense	462	472	751	928
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated share-based compensation expense	526	491	983	915
Selling, general and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated share-based compensation expense	$ 1,601	$ 1,580	$ 3,298	$ 2,524

STOCK-BASED COMPENSATION - Addi

STOCK-BASED COMPENSATION - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015	Jul. 02, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation expense	$ 200		$ 200
Unrecognized stock-based compensation expense, weighted-average period for recognition			1 year 5 months 15 days
Allocated share-based compensation expense	2,589	$ 2,543	$ 5,032	$ 4,367
Restricted stock awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation expense, weighted-average period for recognition			2 years 5 months 26 days
Unrecognized stock-based compensation expense other than options	18,500		$ 18,500
Allocated share-based compensation expense	$ 2,612	2,535	$ 5,203	4,296
PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Probable achievement of PSU performance target, (percent)	100.00%		100.00%
Allocated share-based compensation expense	$ 600	$ 800	$ 1,200	$ 1,000
Inventory
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation capitalized as inventory			600		$ 300
Development of Internal Use Software
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation capitalized as inventory			$ 100

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015	Jul. 02, 2016
Operating Loss Carryforwards [Line Items]
Income tax provision	$ 37	$ 985	$ 443	$ 1,884
Unrecognized tax benefits	3,500		3,500		$ 3,800
Estimated decrease in unrecognized tax benefits	600		600
Unrecognized tax benefits that would affect effective tax rate	$ 2,900		2,900
Italy
Operating Loss Carryforwards [Line Items]
Release of reserve due to expiration of statute of limitations			$ 500

NET INCOME (LOSS) PER SHARE - C

NET INCOME (LOSS) PER SHARE - Calculation of EPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Earnings Per Share [Abstract]
Net income (loss)	$ 30,267	$ 157	$ 33,618	$ (3,353)
Weighted-average shares - Basic (shares)	165,822	110,296	149,151	109,877
Effect of dilutive potential common shares from:
Stock options and stock appreciation rights (shares)	752	82	724	0
Restricted stock units and awards (shares)	2,282	2,016	2,420	0
Convertible notes (shares)	0	0	7,506	0
Weighted-average shares - Diluted (shares)	168,856	112,394	159,801	109,877
Basic net income (loss) per share (in USD per share)	$ 0.18	$ 0	$ 0.23	$ (0.03)
Diluted net income (loss) per share (in USD per share)	$ 0.18	$ 0	$ 0.21	$ (0.03)

NET INCOME (LOSS) PER SHARE - A

NET INCOME (LOSS) PER SHARE - Additional Information (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Earnings Per Share [Abstract]
Antidilutive securities excluded from computation of earnings per share	0.8	36.2	0.8	39.9

GEOGRAPHIC INFORMATION, PRODU52

GEOGRAPHIC INFORMATION, PRODUCT GROUPS AND CUSTOMER CONCENTRATION INFORMATION - Revenues by Geographic Area (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Geographic Information [Line Items]
Revenues	$ 153,914	$ 94,129	$ 289,406	$ 181,679
Total Asia-Pacific
Geographic Information [Line Items]
Revenues	104,516	44,792	194,867	87,073
China
Geographic Information [Line Items]
Revenues	63,927	35,179	122,669	68,235
Thailand
Geographic Information [Line Items]
Revenues	32,184	403	54,130	763
Malaysia
Geographic Information [Line Items]
Revenues	5,377	8,307	11,704	16,160
Other Asia-Pacific
Geographic Information [Line Items]
Revenues	3,028	903	6,364	1,915
Total Americas
Geographic Information [Line Items]
Revenues	31,560	32,933	57,314	59,476
United States
Geographic Information [Line Items]
Revenues	17,281	16,916	31,742	29,967
Mexico
Geographic Information [Line Items]
Revenues	8,068	14,196	17,359	26,534
Other Americas
Geographic Information [Line Items]
Revenues	6,211	1,821	8,213	2,975
EMEA
Geographic Information [Line Items]
Revenues	15,890	15,060	33,747	32,164
Italy
Geographic Information [Line Items]
Revenues	6,718	6,818	16,024	13,889
Germany
Geographic Information [Line Items]
Revenues	3,088	4,010	6,377	8,952
Other EMEA
Geographic Information [Line Items]
Revenues	6,084	4,232	11,346	9,323
Japan
Geographic Information [Line Items]
Revenues	$ 1,948	$ 1,344	$ 3,478	$ 2,966

GEOGRAPHIC INFORMATION, PRODU53

GEOGRAPHIC INFORMATION, PRODUCT GROUPS AND CUSTOMER CONCENTRATION INFORMATION - Revenues by Product Group (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015
Segment Information [Line Items]
Revenues	$ 153,914	$ 94,129	$ 289,406	$ 181,679
100 Gb/s transmission modules
Segment Information [Line Items]
Revenues	113,835	49,554	211,606	90,382
40 Gb/s and lower transmission modules
Segment Information [Line Items]
Revenues	$ 40,079	$ 44,575	$ 77,800	$ 91,297

GEOGRAPHIC INFORMATION, PRODU54

GEOGRAPHIC INFORMATION, PRODUCT GROUPS AND CUSTOMER CONCENTRATION INFORMATION - Additional Information (Details) - customer	3 Months Ended		6 Months Ended		12 Months Ended
	Dec. 31, 2016	Dec. 26, 2015	Dec. 31, 2016	Dec. 26, 2015	Jul. 02, 2016
Revenues
Revenue, Major Customer [Line Items]
Number of major customers	4	3	4	3
Revenues | Customer A
Revenue, Major Customer [Line Items]
Percentage of revenues	22.00%	21.00%	20.00%	19.00%
Revenues | Customer B
Revenue, Major Customer [Line Items]
Percentage of revenues	20.00%	16.00%	19.00%	16.00%
Revenues | Customer C
Revenue, Major Customer [Line Items]
Percentage of revenues	16.00%	10.00%	18.00%	10.00%
Revenues | Customer D
Revenue, Major Customer [Line Items]
Percentage of revenues	10.00%		11.00%
Accounts Receivable
Revenue, Major Customer [Line Items]
Number of major customers			3		4
Accounts Receivable | Customer A
Revenue, Major Customer [Line Items]
Percentage of accounts receivable	23.00%		23.00%		23.00%
Accounts Receivable | Customer B
Revenue, Major Customer [Line Items]
Percentage of accounts receivable	18.00%		18.00%		16.00%
Accounts Receivable | Customer C
Revenue, Major Customer [Line Items]
Percentage of accounts receivable	16.00%		16.00%		13.00%
Accounts Receivable | Customer D
Revenue, Major Customer [Line Items]
Percentage of accounts receivable					10.00%