Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 01, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | AXCELIS TECHNOLOGIES INC | |
Entity Central Index Key | 1,113,232 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 30,095,828 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenue: | ||
Product | $ 81,978 | $ 62,175 |
Services | 4,915 | 5,346 |
Total revenue | 86,893 | 67,521 |
Cost of revenue: | ||
Product | 46,797 | 40,263 |
Services | 5,382 | 3,842 |
Total cost of revenue | 52,179 | 44,105 |
Gross profit | 34,714 | 23,416 |
Operating expenses: | ||
Research and development | 9,895 | 8,636 |
Sales and marketing | 7,049 | 5,960 |
General and administrative | 7,057 | 6,042 |
Restructuring charges | 282 | |
Total operating expenses | 24,001 | 20,920 |
Income from operations | 10,713 | 2,496 |
Other (expense) income: | ||
Interest income | 69 | 54 |
Interest expense | (1,111) | (1,047) |
Other, net | (154) | (59) |
Total other expense | (1,196) | (1,052) |
Income before income taxes | 9,517 | 1,444 |
Income tax provision (benefit) | 11 | (504) |
Net income | $ 9,506 | $ 1,948 |
Net income per share: | ||
Basic (in dollars per share) | $ 0.32 | $ 0.07 |
Diluted (in dollars per share) | $ 0.29 | $ 0.06 |
Shares used in computing net income per share: | ||
Basic weighted average common shares | 29,772 | 29,038 |
Diluted weighted average common shares | 32,255 | 30,520 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Consolidated Statements of Comprehensive Income | ||
Net income | $ 9,506 | $ 1,948 |
Other comprehensive income: | ||
Foreign currency translation adjustments | 1,915 | 1,049 |
Amortization of actuarial gains/losses and other adjustments from pension plan | 28 | 26 |
Total other comprehensive income | 1,943 | 1,075 |
Comprehensive income | $ 11,449 | $ 3,023 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 69,429 | $ 70,791 |
Accounts receivable, net | 67,083 | 50,573 |
Inventories, net | 115,635 | 113,853 |
Prepaid expenses and other current assets | 7,937 | 5,512 |
Total current assets | 260,084 | 240,729 |
Property, plant and equipment, net | 31,486 | 30,840 |
Long-term restricted cash | 6,792 | 6,864 |
Other assets | 24,245 | 23,798 |
Total assets | 322,607 | 302,231 |
Current liabilities: | ||
Accounts payable | 26,426 | 24,996 |
Accrued compensation | 5,920 | 5,142 |
Warranty | 2,748 | 2,426 |
Income taxes | 252 | 240 |
Deferred revenue | 12,179 | 10,335 |
Other current liabilities | 5,310 | 4,592 |
Total current liabilities | 52,835 | 47,731 |
Sale leaseback obligation | 47,681 | 47,586 |
Long-term deferred revenue | 942 | 674 |
Other long-term liabilities | 4,906 | 4,785 |
Total liabilities | 106,364 | 100,776 |
Stockholders' equity: | ||
Common stock, $0.001 par value, 75,000 shares authorized; 29,995 shares issued and outstanding at March 31, 2017; 29,518 shares issued and outstanding at December 31, 2016 | 30 | 30 |
Additional paid-in capital | 538,747 | 535,408 |
Accumulated deficit | (322,198) | (331,704) |
Accumulated other comprehensive loss | (336) | (2,279) |
Total stockholders' equity | 216,243 | 201,455 |
Total liabilities and stockholders' equity | $ 322,607 | $ 302,231 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Consolidated Balance Sheets | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 30,000 | 30,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 75,000 | 75,000 |
Common stock, shares issued | 29,995 | 29,518 |
Common stock, shares outstanding | 29,995 | 29,518 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities | ||
Net income | $ 9,506 | $ 1,948 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation and amortization | 1,177 | 918 |
Deferred taxes | (22) | (50) |
Stock-based compensation expense | 1,075 | 838 |
Provision for excess and obsolete inventory | 578 | 549 |
Changes in operating assets & liabilities: | ||
Accounts receivable | (16,178) | (10,287) |
Inventories | (844) | 1,143 |
Prepaid expenses and other current assets | (2,347) | (1,214) |
Accounts payable and other current liabilities | 3,049 | 1,082 |
Deferred revenue | 2,085 | 226 |
Income taxes | 2 | 30 |
Other assets and liabilities | (749) | (5,364) |
Net cash used in operating activities | (2,668) | (10,181) |
Cash flows from investing activities | ||
Expenditures for property, plant and equipment | (1,116) | (1,275) |
Net cash used in investing activities | (1,116) | (1,275) |
Cash flows from financing activities | ||
Net settlement on restricted stock grants | (286) | (2) |
Proceeds from exercise of stock options | 2,531 | 194 |
Net cash provided by financing activities | 2,245 | 192 |
Effect of exchange rate changes on cash and cash equivalents | 105 | (127) |
Net decrease in cash, cash equivalents and restricted cash | (1,434) | (11,391) |
Cash, cash equivalents and restricted cash at beginning of period | 77,655 | 85,825 |
Cash, cash equivalents and restricted cash at end of period | $ 76,221 | $ 74,434 |
Nature of Business
Nature of Business | 3 Months Ended |
Mar. 31, 2017 | |
Nature of Business | |
Nature of Business | Note 1. Nature of Business Axcelis Technologies, Inc. (“Axcelis” or the “Company”) was incorporated in Delaware in 1995, and is a worldwide producer of ion implantation and other processing equipment used in the fabrication of semiconductor chips in the United States, Europe and Asia. In addition, the Company provides extensive aftermarket service and support, including spare parts, equipment upgrades, used equipment and maintenance services to the semiconductor industry. The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments which are of a normal recurring nature and considered necessary for a fair presentation of these financial statements have been included. Operating results for the interim period presented are not necessarily indicative of the results that may be expected for other interim periods or for the year as a whole. The balance sheet at December 31, 2016 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Axcelis Technologies, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2016. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2017 | |
Stock-Based Compensation | |
Stock-Based Compensation | Note 2. Stock-Based Compensation The Company maintains the Axcelis Technologies, Inc. 2012 Equity Incentive Plan (the “2012 Equity Plan”), which became effective on May 2, 2012, and permits the issuance of options, restricted stock, restricted stock units and performance awards to selected employees, directors and consultants of the Company. The Company’s 2000 Stock Plan (the “2000 Stock Plan”), expired on May 1, 2012 and no new grants may be made under that plan after that date. However, unexpired awards granted under the 2000 Stock Plan remain outstanding and subject to the terms of the 2000 Stock Plan. The Company also maintains the Axcelis Technologies, Inc. Employee Stock Purchase Plan (the “ESPP”), an Internal Revenue Code Section 423 plan. The 2012 Equity Plan and the ESPP are more fully described in Note 14 to the consolidated financial statements in the Company’s 2016 Annual Report on Form 10-K. The Company recognized stock-based compensation expense of $1.1 million and $0.8 million for the three month periods ended March 31, 2017 and 2016, respectively. These amounts include compensation expense related to restricted stock units and non-qualified stock options. In the three month periods ended March 31, 2017 and 2016, the Company issued 0.5 million and 0.1 million shares of common stock, respectively, in relation to stock option exercises and vesting of restricted stock units. In the three month periods ended March 31, 2017 and 2016, the Company received proceeds of $2.5 million and $0.2 million, respectively, in connection with the exercise of stock options. |
Computation of Net Earnings per
Computation of Net Earnings per Share | 3 Months Ended |
Mar. 31, 2017 | |
Computation of Net Earnings per Share | |
Computation of Net Earnings per Share | Note 3. Computation of Net Earnings per Share Basic earnings per share is computed by dividing income available to common stockholders (the numerator) by the weighted‑average number of common shares outstanding (the denominator) for the period. The computation of diluted earnings per share is similar to basic earnings per share, except that the denominator is increased by the number of additional common shares that would have been outstanding if the potentially dilutive common shares issuable for stock options, restricted stock units and employee stock purchase plan accounts had been issued, calculated using the treasury stock method. The components of net earnings per share are as follows: Three months ended March 31, 2017 2016 Net income available to common stockholders $ 9,506 $ 1,948 Weighted average common shares outstanding used in computing basic income per share 29,772 29,038 Incremental options and RSUs 2,483 1,482 Weighted average common shares outstanding used in computing diluted net income per share 32,255 30,520 Net income per share Basic $ 0.32 $ 0.07 Diluted $ 0.29 $ 0.06 Diluted weighted average common shares outstanding does not include options and restricted stock units outstanding to purchase 0.1 million and 0.9 million common equivalent shares for the three month periods ended March 31, 2017 and 2016, respectively, as their effect would have been anti-dilutive. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2017 | |
Accumulated Other Comprehensive Loss | |
Accumulated Other Comprehensive Loss | Note 4. Accumulated Other Comprehensive Loss The following table presents the changes in accumulated other comprehensive income (loss), net of tax, by component for the three months ended March 31, 2017: Foreign Defined benefit currency pension plan Total (in thousands) Balance at December 31, 2016 $ (1,591) $ (688) $ (2,279) Other comprehensive income and pension reclassification 1,915 28 1,943 Balance at March 31, 2017 $ 324 $ (660) $ (336) |
Cash, cash equivalents and rest
Cash, cash equivalents and restricted cash | 3 Months Ended |
Mar. 31, 2017 | |
Cash, cash equivalents and restricted cash | |
Cash, cash equivalents and restricted cash | Note 5. Cash, cash equivalents and restricted cash The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position that sum to the total of the same such amounts shown in the statement of cash flows. March 31, 2017 2016 (dollars in thousands) Cash and cash equivalents $ $ Long-term restricted cash Total cash, cash equivalents and long-term restricted cash $ $ The restricted cash balances of $6.8 million as of March 31, 2017 relates to a $5.9 million letter of credit associated to the security deposit for the sale leaseback transaction, a $0.8 million letter of credit relating to workers’ compensation insurance and a $0.1 million deposit relating to customs activity. The restricted cash balance of $6.9 million as of March 31, 2016 includes the $5.9 million letter of credit associated to the security deposit for the sale leaseback transaction, a $0.9 million letter of credit relating to workers’ compensation insurance and a $0.1 million deposit relating to customs activity. |
Inventories, net
Inventories, net | 3 Months Ended |
Mar. 31, 2017 | |
Inventories, net | |
Inventories, net | Note 6. Inventories, net The components of inventories are as follows: March 31, December 31, 2017 2016 (in thousands) Raw materials $ 78,055 $ 82,263 Work in process 19,892 14,117 Finished goods (completed systems) 17,688 17,473 Inventories, net $ 115,635 $ 113,853 When recorded, inventory reserves are intended to reduce the carrying value of inventories to their net realizable value. The Company establishes inventory reserves when conditions exist that indicate inventory may be in excess of anticipated demand or is obsolete based upon assumptions about future demand for the Company’s products or market conditions. The Company regularly evaluates the ability to realize the value of inventories based on a combination of factors including the following: forecasted sales or usage, estimated product end of life dates, estimated current and future market value and new product introductions. Purchasing and usage alternatives are also explored to mitigate inventory exposure. As of March 31, 2017 and December 31, 2016, inventories are stated net of inventory reserves of $8.6 million and $8.8 million, respectively. |
Product Warranty
Product Warranty | 3 Months Ended |
Mar. 31, 2017 | |
Product Warranty | |
Product Warranty | Note 7. Product Warranty The Company generally offers a one year warranty for all of its systems, the terms and conditions of which vary depending upon the product sold. For all systems sold, the Company accrues a liability for the estimated cost of standard warranty at the time of system shipment and defers the portion of systems revenue attributable to the fair value of non-standard warranty. Costs for non-standard warranty are expensed as incurred. Factors that affect the Company’s warranty liability include the number of installed units, historical and anticipated product failure rates, material usage and service labor costs. The Company periodically assesses the adequacy of its recorded liability and adjusts the amount as necessary. The changes in the Company’s standard product warranty liability are as follows: Three months ended March 31, 2017 2016 (in thousands) Balance at January 1 (beginning of year) $ 2,666 $ 3,555 Warranties issued during the period 1,166 921 Settlements made during the period (454) (1,306) Changes in estimate of liability for pre-existing warranties during the period (254) 365 Balance at March 31 (end of period) $ 3,124 $ 3,535 Amount classified as current $ 2,748 $ 3,288 Amount classified as long-term 376 247 Total warranty liability $ 3,124 $ 3,535 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Measurements | |
Fair Value Measurements | Note 8. Fair Value Measurements Certain assets on the Company’s balance sheets are reported at their “fair value.” Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. (a) Fair Value Hierarchy The accounting guidance for fair value measurement requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is as follows: Level 1 - applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2 - applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 - applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. (b) Fair Value Measurements The Company’s money market funds are included in cash and cash equivalents in the consolidated balance sheets and are considered a level 1 investment as they are valued at quoted market prices in active markets. The following table sets forth the Company’s assets by level within the fair value hierarchy: March 31, 2017 Fair Value Measurements Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Money market funds $ 53,164 $ — $ — $ 53,164 December 31, 2016 Fair Value Measurements Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Money market funds $ 54,170 $ — $ — $ 54,170 (c) Other Financial Instruments The carrying amounts reflected in the consolidated balance sheets for cash and cash equivalents ( which are comprised primarily of deposit and investment accounts) , accounts receivable, prepaid expenses and other current and non-current assets, accounts payable and accrued expenses approximate fair value due to their short-term maturities. |
Financing Arrangements
Financing Arrangements | 3 Months Ended |
Mar. 31, 2017 | |
Financing Arrangements | |
Financing Arrangements | Note 9. Financing Arrangements Sale Leaseback Obligation On January 30, 2015, the Company sold its corporate headquarters facility for $48.9 million. As part of the sale, the Company also entered into a 22-year lease agreement. The sale leaseback is accounted for as a financing arrangement for financial reporting and, as such, the Company has recorded a financing obligation of $47.7 million as of March 31, 2017. The associated lease payments are deemed to include both an interest component and payment of principal, with the underlying liability being extinguished at the end of the original lease term. The Company posted a collateralized security deposit of $5.9 million in the form of an irrevocable letter of credit at the time of the closing. Upon the termination of a credit facility in October 2015, this letter of credit was cash collateralized. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Taxes | |
Income Taxes | Note 10. Income Taxes Income tax expense relates principally to operating results of foreign entities in jurisdictions, primarily in Europe and Asia, where the Company earns taxable income. The Company has significant net operating losses in the United States and certain other tax jurisdictions and, as a result, does not pay significant income taxes in those jurisdictions. At December 31, 2016, the Company had $124.0 million of deferred tax assets worldwide relating to net operating loss carryforwards, tax credit carryforwards and other temporary differences, which are available to reduce income taxes in future years. The Company maintains a 100% domestic valuation allowance, reducing the carrying value of the deferred tax assets in the United States to zero. The Company will continue to maintain a full valuation allowance for those tax assets until accounting principles require the release of the allowance based on expectations of continuing profitability. During the first quarter of 2017, the statute of limitations associated with tax positions previously taken by the Company expired. The related tax reserve of $0.3 million and accrued interest of $0.2 million that had been recorded were reversed during the three months ended March 31, 2017. |
Concentration of Risk
Concentration of Risk | 3 Months Ended |
Mar. 31, 2017 | |
Concentration of Risk | |
Concentration of Risk | Note 11. Concentration of Risk For the three months ended March 31, 2017, four customers accounted for 19.2%, 16.6%, 16.4% and 16.3% of consolidated revenue, respectively. For the three months ended March 31, 2016, three customers accounted for 20.8%, 13.4% and 13.2%, of consolidated revenue, respectively. At March 31, 2017, three customers accounted for 24.9%, 21.5% and 12.7% of consolidated accounts receivable, respectively. At December 31, 2016, four customers accounted for 22.0%, 12.3%, 12.0% and 10.6% of accounts receivable, respectively. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Contingencies | |
Contingencies | Note 12. Contingencies (a) Litigation The Company is, from time to time, a party to litigation that arises in the normal course of its business operations. The Company is not presently a party to any litigation that it believes might have a material adverse effect on its business operations. (b) Indemnifications The Company’s system sales agreements typically include provisions under which the Company agrees to take certain actions, provide certain remedies and defend its customers against third-party claims of intellectual property infringement under specified conditions and to indemnify customers against any damage and costs awarded in connection with such claims. The Company has not incurred any material costs as a result of such indemnifications and has not accrued any liabilities related to such obligations in the accompanying consolidated financial statements. |
Recent Accounting Guidance
Recent Accounting Guidance | 3 Months Ended |
Mar. 31, 2017 | |
Recent Accounting Guidance | |
Recent Accounting Guidance | Note 13. Recent Accounting Guidance Accounting Standards or Updates Adopted In July 2015, the FASB issued Accounting Standards Update (ASU) No. 2015-11, “Simplifying the Measurement of Inventory,” which changes the inventory measurement principles for entities using the first-in, first-out (FIFO) or average cost methods. For entities utilizing one of these methods, the inventory measurement principle changes from lower of cost or market to the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less the reasonably predictable costs of completion, disposal and transportation. The prospective adoption of this ASU in the first quarter of 2017 did not have a material impact on our financial statements and disclosures. In March 2016, the FASB issued ASU No. 2016-09 “Compensation — Stock Compensation,” which changes the accounting for stock-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The amended guidance eliminates the requirement to record excess tax benefits as a reduction in current taxes payable and an increase to additional paid-in capital. The Company adopted this ASU in the first quarter of 2017. The prospective adoption associated with excess tax benefits resulted in the generation of approximately $1.2 million of deferred tax assets relating to federal and state net operating losses that are fully offset by a corresponding increase in the valuation allowance. As a result, there was no adjustment to accumulated deficit. The retrospective adoption of the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares for tax withholding purposes is presented as a financing activity. This resulted in a $0.3 million and a two thousand dollar reduction in net cash provided by financing activities for the three month periods ended March 31, 2017 and 2016, respectively. Prior to adoption, these amounts were reflected within cash flows from operating activities. The Company has also elected to continue to estimate a forfeiture rate associated with our stock-based awards and related expense. In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 203): Restricted Cash (a consensus of the FASB Emerging Issues Task Force).” This ASU requires the statement of cash flows to explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents are to be included with cash and cash equivalents when reconciling the beginning of period and end of period amounts shown on the statement of cash flows. The retrospective adoption of this ASU in the first quarter of 2017 resulted in $6.9 million of restricted cash being included in cash, cash equivalents and restricted cash balances on the statement of cash flows for the periods presented. Please see Note 5 for additional information. Accounting Standards or Updates Not Yet Effective In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers,” which provides guidance for revenue recognition. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In April 2016, the FASB issued ASU 2016-10, “Revenue from Contracts with Customers” (Topic 606 ): Identifying Performance Obligations and Licensing , which further clarifies performance obligations in a contract with a customer. In May 2016, the FASB issued ASU 2016-12, “ Revenue from Contracts with Customers” (Topic 606): Narrow-Scope Improvements and Practical Expedients , which provides a more narrow interpretation of ASU No. 2014-09. These ASUs are effective for annual reporting periods beginning after December 15, 2017 and interim periods within those annual periods. We are currently evaluating the method of adoption and assessing the potential impact the adoption of these standards will have on our financial statements. In February 2016, the FASB issued ASU No. 2016-02 “Leases.” The ASU requires lessees to recognize the rights and obligations created by most leases as assets and liabilities on their balance sheet and continue to recognize expenses on their income statement over the lease term. It will also require disclosures designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases. The guidance is effective for annual reporting periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted for all entities. We are currently evaluating the impact of ASU 2016-02 on the consolidated financial statements and disclosures. In August 2016, the FASB issued ASU No. 2016-15 “Classification of Certain Cash Receipts and Cash Payments.” The ASU is intended to add or clarify guidance on the classification of certain receipts and payments in the statement of cash flows and to eliminate the diversity in practice related to such classifications. The guidance in ASU 2016-15 is required for annual reporting periods beginning after December 15, 2017, with early adoption permitted. We are currently evaluating the impact of ASU 2016-15 on the consolidated financial statements and disclosures. In March 2017, the FASB issued ASU No. 2017-07 “Compensation – Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost.” The ASU is intended to improve the presentation of net periodic pension cost and net periodic postretirement benefit cost. The amendment applies to all entities offering defined benefit pension plan, other postretirement benefit plans, or other types of benefits accounted for under Topic 715. The amendments in the ASU require an employer to report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. The amendments in this ASU are effective for public business entities for annual periods beginning after December 15, 2017, including interim periods within the annual period. The amendments in this ASU should be applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit in assets. We are currently evaluating the impact of ASU 2017-07 on the consolidated financial statements and disclosures. |
Computation of Net Earnings p20
Computation of Net Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Computation of Net Earnings per Share | |
Schedule of components of net earnings per share | Three months ended March 31, 2017 2016 Net income available to common stockholders $ 9,506 $ 1,948 Weighted average common shares outstanding used in computing basic income per share 29,772 29,038 Incremental options and RSUs 2,483 1,482 Weighted average common shares outstanding used in computing diluted net income per share 32,255 30,520 Net income per share Basic $ 0.32 $ 0.07 Diluted $ 0.29 $ 0.06 |
Accumulated Other Comprehensi21
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accumulated Other Comprehensive Loss | |
Schedule of changes in accumulated other comprehensive income, net of tax | Foreign Defined benefit currency pension plan Total (in thousands) Balance at December 31, 2016 $ (1,591) $ (688) $ (2,279) Other comprehensive income and pension reclassification 1,915 28 1,943 Balance at March 31, 2017 $ 324 $ (660) $ (336) |
Cash, cash equivalents and re22
Cash, cash equivalents and restricted cash (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Cash, cash equivalents and restricted cash | |
Schedule of reconciliation of cash, cash equivalents and restricted cash | March 31, 2017 2016 (dollars in thousands) Cash and cash equivalents $ $ Long-term restricted cash Total cash, cash equivalents and long-term restricted cash $ $ |
Inventories, net (Tables)
Inventories, net (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Inventories, net | |
Schedule of components of inventories | March 31, December 31, 2017 2016 (in thousands) Raw materials $ 78,055 $ 82,263 Work in process 19,892 14,117 Finished goods (completed systems) 17,688 17,473 Inventories, net $ 115,635 $ 113,853 |
Product Warranty (Tables)
Product Warranty (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Product Warranty | |
Schedule of product warranty liability | Three months ended March 31, 2017 2016 (in thousands) Balance at January 1 (beginning of year) $ 2,666 $ 3,555 Warranties issued during the period 1,166 921 Settlements made during the period (454) (1,306) Changes in estimate of liability for pre-existing warranties during the period (254) 365 Balance at March 31 (end of period) $ 3,124 $ 3,535 Amount classified as current $ 2,748 $ 3,288 Amount classified as long-term 376 247 Total warranty liability $ 3,124 $ 3,535 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Measurements | |
Schedule of Company's assets and liabilities by level within the fair value hierarchy | March 31, 2017 Fair Value Measurements Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Money market funds $ 53,164 $ — $ — $ 53,164 December 31, 2016 Fair Value Measurements Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Money market funds $ 54,170 $ — $ — $ 54,170 |
Stock-Based Compensation - (Det
Stock-Based Compensation - (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Stock-based compensation | ||
Stock-based compensation expense | $ 1,100 | $ 800 |
Proceeds from exercise of stock options | $ 2,531 | $ 194 |
Common Stock | ||
Stock-based compensation | ||
Exercise of stock options (in shares) | 500,000 | 100,000 |
Proceeds from exercise of stock options | $ 2,500 | $ 200 |
2000 Stock Plan | ||
Stock-based compensation | ||
Number of shares of common stock available for future grant | 0 |
Computation of Net Earnings p27
Computation of Net Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Computation of Net Earnings per Share | ||
Net income available to common stockholders | $ 9,506 | $ 1,948 |
Weighted average common shares outstanding used in computing basic income per share | 29,772 | 29,038 |
Incremental options and RSUs | 2,483 | 1,482 |
Weighted average common shares outstanding used in computing diluted net income per share | 32,255 | 30,520 |
Net income per share | ||
Basic | $ 0.32 | $ 0.07 |
Diluted | $ 0.29 | $ 0.06 |
Weighted average number diluted shares outstanding adjustment | 100 | 900 |
Accumulated Other Comprehensi28
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Changes in accumulated other comprehensive income, net of tax | ||
Balance at the beginning of period | $ (2,279) | |
Other comprehensive income and pension reclassification | 1,943 | $ 1,075 |
Balance at the end of period | (336) | |
Foreign currency | ||
Changes in accumulated other comprehensive income, net of tax | ||
Balance at the beginning of period | (1,591) | |
Other comprehensive income and pension reclassification | 1,915 | |
Balance at the end of period | 324 | |
Defined benefit pension plan | ||
Changes in accumulated other comprehensive income, net of tax | ||
Balance at the beginning of period | (688) | |
Other comprehensive income and pension reclassification | 28 | |
Balance at the end of period | $ (660) |
Cash, cash equivalents and re29
Cash, cash equivalents and restricted cash (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 |
Cash and cash equivalents | $ 69,429 | $ 70,791 | $ 67,571 | |
Long-term restricted cash | 6,792 | 6,863 | ||
Total cash, cash equivalents and long-term restricted cash | 76,221 | $ 77,655 | 74,434 | $ 85,825 |
Workers' Compensation Liability | 800 | 900 | ||
Deposit related to customs activity | 100 | 100 | ||
Revolving credit facility | ||||
Availability used to support outstanding letters of credit | 6,800 | 6,900 | ||
Revolving credit facility | Sale leaseback obligation | ||||
Security Deposit | $ 5,900 | $ 5,900 |
Inventories, net (Details)
Inventories, net (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Inventories, net | ||
Raw materials | $ 78,055 | $ 82,263 |
Work in process | 19,892 | 14,117 |
Finished goods (completed systems) | 17,688 | 17,473 |
Inventories, net | 115,635 | 113,853 |
Inventory reserves | $ 8,600 | $ 8,800 |
Product Warranty (Details)
Product Warranty (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | |
Product Warranty | |||||
Product warranty period | 1 year | ||||
Changes in standard product warranty liability | |||||
Balance at the beginning of the period | $ 2,666 | $ 3,555 | |||
Warranties issued during the period | 1,166 | 921 | |||
Settlements made during the period | (454) | (1,306) | |||
Changes in estimate of liability for pre-existing warranties during the period | (254) | 365 | |||
Balance at the end of the period | 3,124 | 3,535 | |||
Product warranty classification | |||||
Amount classified as current | $ 2,748 | $ 2,426 | $ 3,288 | ||
Amount classified as long-term | 376 | 247 | |||
Total warranty liability | $ 2,666 | $ 3,555 | $ 3,124 | $ 2,666 | $ 3,535 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Recurring - Money market funds - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Total | ||
Fair Value Measurements | ||
Money market funds | $ 53,164 | $ 54,170 |
Level 1 | ||
Fair Value Measurements | ||
Money market funds | $ 53,164 | $ 54,170 |
Financing Arrangements (Details
Financing Arrangements (Details) - USD ($) $ in Thousands | Jan. 30, 2015 | Mar. 31, 2017 | Dec. 31, 2016 |
Financing Arrangements | |||
Sale leaseback obligation | $ 47,681 | $ 47,586 | |
Beverly Property Owner LLC | Sale leaseback obligation | Buildings | |||
Financing Arrangements | |||
Purchase price | $ 48,900 | ||
Lease term | 22 years | ||
Sale leaseback obligation | 47,700 | ||
Security deposit | $ 5,900 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Income Taxes | ||
Deferred tax assets valuation allowance | $ 124 | |
Percentage of valuation allowance | 100.00% | |
Deferred tax assets, net of valuation allowance | $ 0 | |
Reversal of tax reserve | 0.3 | |
Reversal of accrued interest | $ 0.2 |
Concentration of Risk (Details)
Concentration of Risk (Details) - customer | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Revenue | Customer concentration risk | One customer | |||
Concentration of risk | |||
Number of customers | 4 | 3 | |
Percentage of concentration risk | 20.80% | 22.00% | |
Revenue | Customer concentration risk | Second customer | |||
Concentration of risk | |||
Number of customers | 4 | 3 | |
Percentage of concentration risk | 13.40% | 12.30% | |
Revenue | Customer concentration risk | Third customer | |||
Concentration of risk | |||
Number of customers | 4 | 3 | |
Percentage of concentration risk | 13.20% | 12.00% | |
Revenue | Customer concentration risk | Fourth customer | |||
Concentration of risk | |||
Number of customers | 4 | ||
Percentage of concentration risk | 10.60% | ||
Revenue | Credit concentration risk | One customer | |||
Concentration of risk | |||
Percentage of concentration risk | 19.20% | ||
Revenue | Credit concentration risk | Second customer | |||
Concentration of risk | |||
Percentage of concentration risk | 16.60% | ||
Revenue | Credit concentration risk | Third customer | |||
Concentration of risk | |||
Percentage of concentration risk | 16.40% | ||
Revenue | Credit concentration risk | Fourth customer | |||
Concentration of risk | |||
Percentage of concentration risk | 16.30% | ||
Consolidated accounts receivable | Customer concentration risk | One customer | |||
Concentration of risk | |||
Number of customers | 3 | 4 | |
Consolidated accounts receivable | Customer concentration risk | Second customer | |||
Concentration of risk | |||
Number of customers | 3 | 4 | |
Consolidated accounts receivable | Customer concentration risk | Third customer | |||
Concentration of risk | |||
Number of customers | 3 | 4 | |
Consolidated accounts receivable | Customer concentration risk | Fourth customer | |||
Concentration of risk | |||
Number of customers | 4 | ||
Consolidated accounts receivable | Credit concentration risk | One customer | |||
Concentration of risk | |||
Percentage of concentration risk | 24.90% | ||
Consolidated accounts receivable | Credit concentration risk | Second customer | |||
Concentration of risk | |||
Percentage of concentration risk | 21.50% | ||
Consolidated accounts receivable | Credit concentration risk | Third customer | |||
Concentration of risk | |||
Percentage of concentration risk | 12.70% |