Axcelis (ACLS) 10-Q 3 Aug 18 2018 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 01, 2018
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	Jun. 30, 2018
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		32,355,546
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q2

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Revenue:
Revenue	$ 119,333	$ 102,790	$ 241,518	$ 189,683
Cost of revenue:
Cost of revenue	70,333	63,728	145,362	115,907
Gross profit	49,000	39,062	96,156	73,776
Operating expenses:
Research and development	12,553	11,256	24,786	21,151
Sales and marketing	8,912	7,485	17,323	14,534
General and administrative	8,268	7,791	16,278	14,848
Total operating expenses	29,733	26,532	58,387	50,533
Income from operations	19,267	12,530	37,769	23,243
Other (expense) income:
Interest income	515	111	925	180
Interest expense	(1,127)	(1,336)	(2,464)	(2,447)
Other, net	(1,016)	16	(1,118)	(138)
Total other expense	(1,628)	(1,209)	(2,657)	(2,405)
Income before income taxes	17,639	11,321	35,112	20,838
Income tax provision (benefit)	2,970	(2,611)	6,528	(2,600)
Net income	$ 14,669	$ 13,932	$ 28,584	$ 23,438
Net income per share:
Basic (in dollars per share)	$ 0.46	$ 0.46	$ 0.89	$ 0.78
Diluted (in dollars per share)	$ 0.43	$ 0.42	$ 0.84	$ 0.72
Shares used in computing net income per share:
Basic weighted average common shares	32,214	30,589	32,154	30,183
Diluted weighted average common shares	33,942	33,168	34,048	32,779
Product
Revenue:
Revenue	$ 112,521	$ 96,539	$ 228,543	$ 178,517
Cost of revenue:
Cost of revenue	63,913	57,689	132,287	104,486
Services
Revenue:
Revenue	6,812	6,251	12,975	11,166
Cost of revenue:
Cost of revenue	$ 6,420	$ 6,039	$ 13,075	$ 11,421

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Consolidated Statements of Comprehensive Income
Net income	$ 14,669	$ 13,932	$ 28,584	$ 23,438
Other comprehensive (loss) income:
Foreign currency translation adjustments	(2,321)	489	(1,300)	2,404
Amortization of actuarial loss and other adjustments from pension plan	30	29	60	57
Total other comprehensive (loss) income	(2,291)	518	(1,240)	2,461
Comprehensive income	$ 12,378	$ 14,450	$ 27,344	$ 25,899

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 147,297	$ 133,407
Short-term restricted cash	730	750
Accounts receivable, net	74,429	75,302
Inventories, net	129,554	120,544
Prepaid expenses and other current assets	10,925	9,772
Total current assets	362,935	339,775
Property, plant and equipment, net	36,312	36,168
Long-term restricted cash	6,915	6,723
Deferred income taxes	77,005	83,148
Other assets	25,264	22,404
Total assets	508,431	488,218
Current liabilities:
Accounts payable	32,633	32,642
Accrued compensation	12,727	20,955
Warranty	4,698	4,112
Income taxes	163	273
Deferred revenue	11,927	16,181
Other current liabilities	4,542	5,124
Total current liabilities	66,690	79,287
Sale leaseback obligation	47,735	47,714
Long-term deferred revenue	3,248	1,964
Other long-term liabilities	5,144	5,643
Total liabilities	122,817	134,608
Commitments and contingencies (Note 13)
Stockholders' equity:
Common stock, $0.001 par value, 75,000 shares authorized; 32,331 shares issued and outstanding at June 30, 2018; 32,048 shares issued and outstanding at December 31, 2017	32	32
Additional paid-in capital	559,207	556,147
Accumulated deficit	(174,561)	(204,745)
Accumulated other comprehensive income	936	2,176
Total stockholders' equity	385,614	353,610
Total liabilities and stockholders' equity	$ 508,431	$ 488,218

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands	Jun. 30, 2018	Dec. 31, 2017
Consolidated Balance Sheets
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	75,000	75,000
Common stock, shares issued	32,331	32,048
Common stock, shares outstanding	32,331	32,048

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash flows from operating activities
Net income	$ 28,584	$ 23,438
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	2,776	2,432
Deferred taxes	6,144	(2,910)
Stock-based compensation expense	3,188	2,580
Provision for excess and obsolete inventory	1,170	1,014
Changes in operating assets & liabilities:
Accounts receivable	530	2,699
Inventories	(9,330)	(7,527)
Prepaid expenses and other current assets	(1,272)	(4,253)
Accounts payable and other current liabilities	(8,032)	10,788
Deferred revenue	(1,358)	3,859
Income taxes	(104)	7
Other assets and liabilities	(6,956)	(730)
Net cash provided by operating activities	15,340	31,397
Cash flows from investing activities
Expenditures for property, plant and equipment and capitalized software	(1,675)	(1,849)
Net cash used in investing activities	(1,675)	(1,849)
Cash flows from financing activities
Net settlement on restricted stock grants	(1,387)	(1,134)
Proceeds from Employee Stock Purchase Plan	437	349
Proceeds from exercise of stock options	822	9,290
Net cash (used in) provided by financing activities	(128)	8,505
Effect of exchange rate changes on cash and cash equivalents	525	(357)
Net increase in cash, cash equivalents and restricted cash	14,062	37,696
Cash, cash equivalents and restricted cash at beginning of period	140,880	77,655
Cash, cash equivalents and restricted cash at end of period	$ 154,942	$ 115,351

Nature of Business

Nature of Business	6 Months Ended
	Jun. 30, 2018
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 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 worldwide 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 periods 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, 2017 has been derived from the audited consolidated 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, 2017.

Stock-Based Compensation

Stock-Based Compensation	6 Months Ended
	Jun. 30, 2018
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 11 to the consolidated financial statements in the Company’s 2017 Annual Report on Form 10-K. The Company recognized stock-based compensation expense of $2.1 million and $1.5 million for the three month periods ended June 30, 2018 and 2017, respectively. The Company recognized stock-based compensation expense of $3.2 million and $2.6 million for the six month periods ended June 30, 2018 and 2017, respectively. These amounts include compensation expense related to restricted stock units (“RSUs”), non-qualified stock options and stock to be issued to participants under the ESPP. In the three month periods ended June 30, 2018 and 2017, the Company issued 0.2 million and 1.2 million shares of common stock, respectively, in relation to stock option exercises, shares issued under the ESPP and vesting of RSUs. In the three month periods ended June 30, 2018 and 2017, the Company received proceeds of $0.9 million and $7.1 million, respectively, in connection with the exercise of stock options and ESPP purchases. In the six month periods ended June 30, 2018 and 2017, the Company issued 0.3 million and 1.7 million shares of common stock, respectively, in relation to stock option exercises, shares issued under the ESPP and vesting of restricted stock units. In the six month periods ended June 30, 2018 and 2017, the Company received proceeds of $1.3 million and $9.6 million, respectively, in connection with the exercise of stock options and ESPP purchases.

Revenue

Revenue	6 Months Ended
	Jun. 30, 2018
Revenue
Revenue	Note 3. Revenue We design, manufacture and service ion implantation and other processing equipment used in the fabrication of semiconductor chips and sell our products to leading semiconductor chip manufacturers worldwide. We offer a complete line of high energy, high current and medium current implanters (“Systems”) for all application requirements. In addition, we provide extensive aftermarket lifecycle products and services (“Aftermarket”), including used tools, spare parts, equipment upgrades, maintenance service and customer training. Under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers or (“ASC 606”), revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration we expect to receive in exchange for those goods or services. We measure revenue based on the consideration specified in the client arrangement, and revenue is recognized when the performance obligations in the client arrangement are satisfied. A performance obligation is a promise in a contract to transfer a distinct product or service to the customer. The transaction price of a contract is allocated to each distinct performance obligation based upon the relative standalone selling price for each performance obligation and recognized as revenue when or as, the customer receives the benefit of the performance obligation. See Footnote 14 regarding the impact of the adoption of ASC 606 on our financial statements. To account for and measure revenue, the Company applies the following five steps: 1) Identify the contract with the customer A contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the goods or services to be transferred and identifies the related payment terms, (ii) the contract has commercial substance, and (iii) the Company determines that collection of substantially all consideration for goods and services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. 2) Identify the performance obligations in the contract Performance obligations promised in a contract are identified based on the goods and services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the good or service either on its own or together with other available resources, and are distinct in the context of the contract, whereby the transfer of the good or service is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised goods and services, the Company must apply judgment to determine whether promised goods and services are capable of being distinct and distinct in the context of the contract. If these criteria are not met, the promised goods and services are accounted for as a combined performance obligation. Our Systems sales consist of multiple performance obligations, including the system itself and obligations that are not delivered simultaneously with the system. These undelivered obligations might include a combination of installation services, extended warranty and support and spare parts, all of which are generally covered by a single sales price. Our aftermarket business includes both products and services type arrangements. Performance obligations in these contracts consist of used tools, spare parts, equipment upgrades, maintenance services and customer training. Customers who purchase new systems are provided an assurance-type warranty for one year after acceptance of the tool. For Aftermarket transactions, we provide customers an assurance-type warranty for 90 days. Customers can choose to purchase extended warranty terms with enhanced support similar to a service-type warranty ranging from one to three years. In accordance with ASC 606, assurance-type warranties are not considered a performance obligation, whereas service-type warranties are. 3) Determine the transaction price The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring goods and services to the customer. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Any estimates, including the effect of the constraint on variable consideration, are evaluated at each reporting period for any changes. In applying this guidance, Companies must also consider whether any significant financing components exist. The transaction price for all transactions is based on the price reflected in the individual customers purchase order. Variable consideration has not been identified as a significant component of the transaction price for any of our transactions. For those transactions where all performance obligations will be satisfied within one year or less, the Company is applying the practical expedient outlined in ASC 606-10-32-18. This practical expedient allows the Company not to adjust promised consideration for the effects of a significant financing component if the Company expects at contract inception the period between when the Company transfers the promised good or service to a customer and when the customer pays for that good or service will be one year or less. For those transactions that are expected to be completed after one year, the Company has assessed that there are no significant financing components because any difference between the promised consideration and the cash selling price of the good or service is for reasons other than the provision of financing. 4) Allocate the transaction price to performance obligations in the contract If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation on a relative standalone selling price basis unless the transaction price is variable and meets the criteria to be allocated entirely to a performance obligation or to a distinct service that forms part of a single performance obligation. Where required, the Company determines standalone selling price (SSP) for each obligation based on consideration of both market and Company specific factors, including the selling price and profit margin for similar products, the cost to produce, and the anticipated margin. For those contracts that contain multiple performance obligations (primarily systems sales, as well as some aftermarket contracts requiring both time and material inputs), the company must determine SSP. The Company used a cost plus margin approach in determining the SSP for any materials related performance obligations (such as upgrades, spare parts, systems). To determine the SSP for labor related performance obligations (such as the labor component of installation), the Company used directly observable inputs based on the standalone sale prices for these services. 5) Recognize revenue when or as the Company has satisfied a performance obligation The Company satisfies performance obligations either over time or at a point in time. Revenue is recognized over time if either 1) the customer simultaneously receives and consumes the benefits provided by the entity’s performance, 2) the entity’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced, or 3) the entity’s performance does not create an asset with an alternative use to the entity and the entity has an enforceable right to payment for performance completed to date. If the entity does not satisfy a performance obligation over time, the related performance obligation is satisfied at a point in time by transferring the control of a promised good or service to a customer. Examples of control are using the asset to produce goods or services, enhance the value of other assets, settle liabilities, and holding or selling the asset. For over time recognition, ASC 606 requires the Company to select a single revenue recognition method for the performance obligation that faithfully depicts the Company’s performance in transferring control of the goods and services. The guidance allows entities to choose between two methods to measure progress toward complete satisfaction of a performance obligation: Output methods - recognize revenue on the basis of direct measurements of the value to the customer of the goods or services transferred to date relative to the remaining goods or services promised under the contract (e.g. surveys of performance completed to date, appraisals of results achieved, milestones reached, time elapsed, and units produced or units delivered); and Input methods - recognize revenue on the basis of the entity’s efforts or inputs to the satisfaction of a performance obligation (e.g., resources consumed, labor hours expended, costs incurred, or time elapsed) relative to the total expected inputs to the satisfaction of that performance obligation. The Company has the right to consideration from a customer in an amount that corresponds directly with the value to the customer of the entity’s performance completed to date (i.e. certain aftermarket contracts), as such the Company has elected a practical expedient to recognize revenue in the amount to which the entity has a right to invoice for such services. Product related revenues (whether for systems or aftermarket business) are recognized at a point in time, when they are shipped or delivered, depending on shipping terms. For installation services, revenue is recognized at a point in time, once the installation of the tool is complete. The nature of the installation services are such that the customer does not simultaneously receive and consume the benefits provided by the entity’s performance, nor does performance of installation services create or enhance an asset that the customer controls. Installation services do not create an asset with an alternative use to the entity, and the entity does not have an enforceable right to payment for performance completed to date. Service-type warranties for any product are recognized over time, as these represent a stand ready obligation to service the product during the warranty period. Progress in the satisfaction of these performance obligations will be measured using an input method of time elapsed. Maintenance and service contracts are recognized over time. Progress in the satisfaction of these performance obligations will be measured using an input method of either time elapsed in the case of fixed period contracts, or labor hours expended, in the case of project based contracts. Cost to Obtain and Fulfill a Contract with a Customer The Company recognizes an asset related to incremental costs of obtaining a contract with a customer if the Company expects to recover those costs. The Company will recognize an asset from costs incurred to fulfill a contract only if such costs relate directly to a contract that the entity can specifically identify, the costs generate or enhance resources of the Company that will be used in satisfying performance obligations in the future, and the costs are expected to be recovered. Any assets recognized related to costs to obtain or fulfill a contract are amortized on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the asset relates. In substantially all of our business transactions, we incur incremental costs to obtain contracts with customers, in the form of sales commissions. We maintain a commission program which awards our employees for System sales, aftermarket activity and other individual goals. Under ASC 606, an asset shall be amortized on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the asset relates. However, ASC 606 provides a practical expedient to allow for the recognition of commission expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. Based on the nature of the Company’s commission agreements, all commissions are expensed as incurred based upon the expectation that the amortization period would be one year or less. Revenue Categories used by Management Our business operates in the following fundamental disciplines: Systems and Aftermarket. Revenue by categories used by management are as follows: Three months ended Six months ended June 30, June 30, 2018* 2017 2018* 2017 (in thousands) (in thousands) Systems $ $ $ $ Aftermarket 45,414 40,350 82,123 71,992 $ $ $ $ *The impact upon adoption of ASC 606 was an increase to Systems revenue of $0.8 million and $1.8 million for the three and six month periods ended June 30, 2018, respectively. Please refer to Note 14 for additional discussion of ASC 606 adoption impact on revenue amounts and comparable revenue figures. The increase in revenue in the three and six month periods ended June 30, 2018, in comparison to the three and six month periods ended June 30, 2017, is attributable to an increase in sales of our Purion products and Aftermarket business. Economic factors affecting our revenue Global economic conditions have a direct impact on our revenue. We are substantially dependent on sales of our products and services to customers outside the United States. Adverse economic conditions such as political and economic instability, potential adverse tax consequences and volatility in exchange rates pose a risk that our clients may reduce, postpone or cancel spending for our products and services, which would impact our revenue. Revenue by geographic markets is determined based upon the location to which our products are shipped and where our services are performed. Revenue in our principal geographic markets is as follows: Three months ended Six months ended June 30, June 30, 2018* 2017 2018* 2017 (in thousands) (in thousands) North America $ $ $ $ Asia Europe $ $ $ $ *The impact upon adoption of ASC 606 for the three months ended June 30, 2018 was an increase in revenue to Asia and North America $0.8 million and $0.1 million, respectively, and a decrease to Europe of $0.1 million. The impact upon adoption of ASC 606 for the six months ended June 30, 2018 was an increase in revenue to Asia of $2.3 million and a decrease to North America and Europe of $0.3 million and $0.2 million, respectively. Please refer to Note 14 for additional discussion of ASC 606 adoption impact on revenue amounts and comparable revenue figures. Contract assets and liabilities Contract assets and contract liabilities are as follows: June 30, December 31, 2018 2017 (in thousands) Contract assets $ — $ — Contract liabilities $ 15,175 $ 18,145 Three months ended Six months ended June 30, June 30, 2018 2017 2018 2017 (in thousands) Revenue recognized in the period from: Amounts included in contract liability at the beginning of the period $ 8,787 $ 3,780 $ 10,617 $ 7,066 Performance obligations satisfied in previous periods $ — $ — $ — $ — Contract liabilities are reflected as deferred revenue on the consolidated balance sheet. Contract liabilities relate to payments invoiced or received in advance of completion of performance obligations under a contract. Contract liabilities are recognized as revenue upon the fulfillment of performance obligations. The decrease in contract liabilities of $3.0 million from December 31, 2017 to June 30, 2018 is primarily due the reclassification of $1.6 million relating to our adoption of ASC 606 as well as timing of system acceptances to a decrease in deferrals. The majority of our system transactions have payment terms that are 90% due upon shipment of the tool and 10% due upon installation. Aftermarket transaction payment terms are such that payment is due either within 30 or 60 days of service provided or delivery of parts. As of June 30, 2018, the Company had deferred revenue of $15.2 million. This represents the portion of the transaction price for contracts with customers allocated to the performance obligations that remain unsatisfied or partially unsatisfied. Short-term deferred revenue of $11.9 million represents performance obligations that will be satisfied within the next 12 months. This amount relates primarily to installation and non-standard warranty performance obligations for system sales. Long-term deferred revenue of $3.2 million relates primarily to unsatisfied extended warranty performance obligations that expected to be satisfied within the next 24 months.

Computation of Net Earnings per

Computation of Net Earnings per Share	6 Months Ended
	Jun. 30, 2018
Computation of Net Earnings per Share
Computation of Net Earnings per Share	Note 4. 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 and restricted stock units had been issued, calculated using the treasury stock method. The components of net earnings per share are as follows: Three months ended Six months ended June 30, June 30, 2018 2017 2018 2017 (in thousands, except per share amounts) Net income available to common stockholders $ 14,669 $ 13,932 $ 28,584 $ 23,438 Weighted average common shares outstanding used in computing basic income per share 32,214 30,589 32,154 30,183 Incremental options and RSUs 1,728 2,579 1,894 2,596 Weighted average common shares used in computing diluted net income per share 33,942 33,168 34,048 32,779 Net income per share Basic $ 0.46 $ 0.46 $ 0.89 $ 0.78 Diluted $ 0.43 $ 0.42 $ 0.84 $ 0.72 Diluted weighted average common shares outstanding does not include options and restricted stock units outstanding to purchase 0.3 million and six thousand common equivalent shares for the three month periods ended June 30, 2018 and 2017, respectively, and does not include options and restricted stock units outstanding to purchase ten thousand and 0.3 million common equivalent shares for the six month periods ended June 30, 2018 and 2017, respectively, as their effect would have been anti-dilutive.

Accumulated Other Comprehensive

Accumulated Other Comprehensive Income	6 Months Ended
	Jun. 30, 2018
Accumulated Other Comprehensive Income
Accumulated Other Comprehensive Income	Note 5. Accumulated Other Comprehensive Income The following table presents the changes in accumulated other comprehensive income, net of tax, by component, for the six months ended June 30, 2018: Foreign Defined benefit currency pension plan Total (in thousands) Balance at December 31, 2017 $ 2,756 $ (580) $ 2,176 Other comprehensive income and pension reclassification (1,300) 60 (1,240) Balance at June 30, 2018 $ 1,456 $ (520) $ 936

Cash, cash equivalents and rest

Cash, cash equivalents and restricted cash	6 Months Ended
	Jun. 30, 2018
Cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash	Note 6. 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 amounts shown in the statement of cash flows. June 30, 2018 2017 (in thousands) Cash and cash equivalents $ $ Short-term and long-term restricted cash Total cash, cash equivalents and restricted cash $ $ The restricted cash balance of $7.6 million as of June 30, 2018 is the result of (i) a $5.9 million letter of credit associated with a security deposit for the lease of our corporate headquarters in Beverly, Massachusetts, (ii) a $0.8 million letter of credit relating to workers’ compensation insurance, (iii) two bank guaranties of our performance relating to customer payments in the amounts of $0.7 million and $0.1 million and (iv) a $0.1 million deposit relating to customs activity. The restricted cash balance of $6.8 million as of June 30, 2017 includes the same items except for the bank guarantees.

Inventories, net

Inventories, net	6 Months Ended
	Jun. 30, 2018
Inventories, net
Inventories, net	Note 7. Inventories, net The components of inventories are as follows: June 30, December 31, 2018 2017 (in thousands) Raw materials $ 85,077 $ 82,313 Work in process 34,560 31,651 Finished goods (completed systems) 9,917 6,580 Inventories, net $ 129,554 $ 120,544 When recorded, inventory reserves 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.

Product Warranty

Product Warranty	6 Months Ended
	Jun. 30, 2018
Product Warranty
Product Warranty	Note 8. 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: Six months ended June 30, 2018 2017 (in thousands) Balance at January 1 (beginning of year) $ 4,502 $ 2,666 Warranties issued during the period 3,124 2,577 Settlements made during the period (2,892) (1,090) Changes in estimate of liability for pre-existing warranties during the period 411 (281) Balance at June 30 (end of period) $ 5,145 $ 3,872 Amount classified as current $ 4,698 $ 3,537 Amount classified as long-term 447 335 Total warranty liability $ 5,145 $ 3,872

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Jun. 30, 2018
Fair Value Measurements
Fair Value Measurements	Note 9. 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 and short-term investments 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: June 30, 2018 Fair Value Measurements Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Money market funds, U.S. Government Securities and Agency Investments $ 129,620 $ — $ — $ 129,620 December 31, 2017 Fair Value Measurements Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Money market funds, U.S. Government Securities and Agency Investments $ 116,433 $ — $ — $ 116,433 (c) Other Financial Instruments The carrying amounts reflected in the consolidated balance sheets for accounts receivable, prepaid expenses and other current assets and non-current assets, restricted cash, accounts payable and accrued expenses approximate fair value due to their short-term maturities.

Financing Arrangements

Financing Arrangements	6 Months Ended
	Jun. 30, 2018
Financing Arrangements
Financing Arrangements	Note 10. Financing Arrangements Sale Leaseback Obligation On January 30, 2015, the Company sold its corporate headquarters facility in Beverly Massachusetts 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 June 30, 2018. 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 security deposit of $5.9 million in the form of an irrevocable letter of credit at the time of the closing. This letter of credit is cash collateralized and the associated cash is included in long-term restricted cash.

Income Taxes

Income Taxes	6 Months Ended
	Jun. 30, 2018
Income Taxes
Income Taxes	Note 11. Income Taxes During the three months ended June 30, 2018 we recorded an income tax provision of $3.0 million. During the six months ended June 30, 2018 we recorded an income tax provision of $6.5 million. Included in the income tax provision for the three and six months ended June 30, 2018 was a tax benefit of $0.3 million recognized upon the expiration of the statute of limitations regarding an uncertain tax position previously recorded. Interest and penalties of $0.2 million previously accrued were credited to interest expense. The change in the income tax provision for the three and six months periods ended June 30, 2018 compared to the prior year was primarily due to the release of a significant portion of our valuation allowance in the fourth quarter of 2017. Prior to the release of the valuation allowance, the Company reported in its consolidated statements of operations only the amount of taxes actually payable. Subsequent to the release of the valuation allowance, tax expense also reflects the tax liability that would be payable without consideration of the usage of any net operating loss carryforwards. We have significant net operating loss carryforwards in the United States and certain European jurisdictions, and, as a result, we do not currently pay significant income taxes in those jurisdictions. At December 31, 2017, the Company had $90.3 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 tax liabilities in future years. On December 22, 2017, the Tax Cuts and Jobs Act ("TCJA") was enacted into law, which significantly changed existing U.S. tax law and includes numerous provisions that affect our business, such as reducing the U.S. federal statutory tax rate and adopting a territorial tax system. The TCJA reduces the U.S. federal statutory tax rate from 35% to 21%, effective January 1, 2018. The TCJA also includes a provision to tax global intangible low-taxed income ("GILTI") of foreign subsidiaries and a base erosion anti-abuse tax ("BEAT") measure that taxes certain payments between a U.S. corporation and its subsidiaries. The Company considered the available guidance and has incorporated the relevant provisions of GILTI into the income tax provision and concluded that the provisions of BEAT do not apply to the Company at this time. In accordance with Staff Accounting Bulletin 118, the Company disclosed in its 2017 Annual Report on Form 10-K that it is able to determine a reasonable estimate for certain effects of tax reform and has recorded that estimate as a provisional amount. The Company intends to use the one-year measurement period to update the provisional amount recorded as it finalizes its analysis relating to certain matters, such as developing interpretations of provisions to the TCJA, changes to certain estimates and amounts related to the Earning and Profits of certain subsidiaries and the filing of tax returns. Also, Treasury regulations, administrative interpretations, or court decisions interpreting the TCJA may require further adjustments and changes to the provisional amounts. As of the second quarter 2018, the Company has not made any changes to its estimate for the transition tax liability.

Concentration of Risk

Concentration of Risk	6 Months Ended
	Jun. 30, 2018
Concentration of Risk
Concentration of Risk	Note 12. Concentration of Risk For the three months ended June 30, 2018, one customer accounted for 23.9% of total revenue. For the three months ended June 30, 2017, four customers accounted for 27.3%, 21.6%, 12.8% and 10.5% of total revenue, respectively. For the six months ended June 30, 2018, two customers accounted for 24.9% and 11.8% of total revenue, respectively. For the six months ended June 30, 2017, four customers accounted for 22.3%, 19.2%, 15.7% and 13.3% of total revenue, respectively. At June 30, 2018, one customer accounted for 10.0% of accounts receivable, respectively. At December 31, 2017, three customers accounted for 19.8%, 11.8% and 10.6% of accounts receivable, respectively.

Contingencies

Contingencies	6 Months Ended
	Jun. 30, 2018
Contingencies
Contingencies	Note 13. 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	6 Months Ended
	Jun. 30, 2018
Recent Accounting Guidance
Recent Accounting Guidance	Note 14. Recent Accounting Guidance Accounting Standards or Updates Adopted In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“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. In July 2017, the FASB issued ASU 2017-13, “Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842) , which clarify the transition periods related to public and private business entities . These ASUs (collectively referred to as “Topic 606”) are effective for annual reporting periods beginning after December 15, 2017 and interim periods within those annual periods. Effective January 1, 2018, we adopted FASB ASC Topic 606, Revenue from Contracts with Customers , or ASC 606. In accordance with ASC 606, we changed certain characteristics of our revenue recognition accounting policy as described below. In our adoption, ASC 606 was applied only to open contracts using the modified retrospective method, where the cumulative effect of the initial application is recognized as an adjustment to opening retained earnings at January 1, 2018. Therefore, comparative prior periods have not been adjusted and continue to be reported under FASB ASC Topic 605, Revenue Recognition , or ASC 605. In accordance with the new revenue standard requirements, the disclosure of the impact of adoption on our consolidated statement of operations for the three and six months ended June 30, 2018 and consolidated balance sheet as of June 30, 2018 was as follows (in thousands): Three months ended Six months ended June 30, 2018 June 30, 2018 Consolidated Statement of Operations As Reported ASC 606 Pro Forma Under ASC 605 As Reported ASC 606 Pro Forma Under ASC 605 Revenue: Product $ 112,521 $ (830) $ 111,691 $ 228,543 $ (1,836) $ 226,707 Total revenue 119,333 (830) 118,503 241,518 (1,836) 239,682 Gross profit 49,000 (830) 48,170 96,156 (1,836) 94,320 Income from operations 19,267 (830) 18,437 37,769 (1,836) 35,933 Income before income taxes 17,639 (830) 16,809 35,112 (1,836) 33,276 Income tax provision 2,970 (166) 2,804 6,528 (398) 6,130 Net income $ 14,669 $ (664) $ 14,005 $ 28,584 $ (1,438) $ 27,146 Net income per share: Basic $ 0.46 $ (0.02) $ 0.44 $ 0.89 $ (0.04) $ 0.85 Diluted $ 0.43 $ (0.02) $ 0.41 $ 0.84 $ (0.04) $ 0.80 June 30, 2018 Consolidated Balance Sheet As Reported ASC 606 Pro Forma Under ASC 605 Deferred income taxes $ 77,005 $ 398 $ 77,403 Total assets $ 508,431 $ 398 $ 508,829 Deferred revenue $ 15,175 $ 2,430 $ 17,605 Total current liabilities 66,690 2,430 69,120 Total liabilities 122,817 2,430 125,247 Accumulated deficit (174,561) (2,032) (176,593) Total stockholders' equity 385,614 (2,032) 383,582 Total liabilities and stockholders' equity $ 508,431 $ 398 $ 508,829 The impact of the adoption of ASC 606 on consolidated statements of comprehensive income and cash flows for the six months ended June 30, 2018 was not material. Upon adoption of ASC 606, we changed our accounting policy for the installation performance obligation included in all system sales. Previously under ASC 605, the Company deferred revenue for the greater of the fair value of the installation or the portion of contract consideration for which collection was contingent upon installation completion (the “retention”). The concept of contingent consideration is no longer relevant under ASC 606 and therefore we will only defer the portion of the transaction price allocated to the installation performance obligation. As a result of this change, we recorded a cumulative effect adjustment to increase retained earnings and decrease deferred revenue on January 1, 2018 by $1.6 million. Upon the adoption, all new contracts will be accounted for under ASC 606. Disclosures related to the nature, amount and timing of revenue and cash flows arising from contracts with customers are included in Note 3. 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 relating to specific cash flow 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, and is to be applied retrospectively for each period presented. Adoption of ASU 2016-15 had no material effect on our 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 a 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. Adoption of ASU 2017-07 had no material effect on the consolidated financial statements and disclosures. Accounting Standards or Updates Not Yet Effective 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. In July 2018, the FASB issued ASU No. 2018-11 “Leases (Topic 842)” , that provides targeted improvements relating to the transition method options with which to adopt the new standard. Under this additional and optional transition method, an entity initially applies the new lease standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. An entity that elects this transition method must provide the required Topic 840 disclosures for all periods that continue to be in accordance with Topic 840. We are currently evaluating the impact of ASUs 2016-02 and 2018-11 on the consolidated financial statements and disclosures. The Company anticipates adopting the new standard on January 1, 2019 using the modified retrospective approach under the ASU 2018-11 transition method with the primary effect of adopting the new standard to be the recognition of additional right-of-use assets and corresponding liabilities related to operating leases. The adoption is not expected to have a material impact on the Company’s results of operations and cash flows.

Revenue (Tables)

Revenue (Tables)	6 Months Ended
	Jun. 30, 2018
Revenue
Schedule of revenue by discipline	Three months ended Six months ended June 30, June 30, 2018* 2017 2018* 2017 (in thousands) (in thousands) Systems $ $ $ $ Aftermarket 45,414 40,350 82,123 71,992 $ $ $ $
Schedule of revenue by geographic markets	Three months ended Six months ended June 30, June 30, 2018* 2017 2018* 2017 (in thousands) (in thousands) North America $ $ $ $ Asia Europe $ $ $ $
Schedule of contract assets and contract liabilities	June 30, December 31, 2018 2017 (in thousands) Contract assets $ — $ — Contract liabilities $ 15,175 $ 18,145 Three months ended Six months ended June 30, June 30, 2018 2017 2018 2017 (in thousands) Revenue recognized in the period from: Amounts included in contract liability at the beginning of the period $ 8,787 $ 3,780 $ 10,617 $ 7,066 Performance obligations satisfied in previous periods $ — $ — $ — $ —

Computation of Net Earnings p22

Computation of Net Earnings per Share (Tables)	6 Months Ended
	Jun. 30, 2018
Computation of Net Earnings per Share
Schedule of components of net income per share	Three months ended Six months ended June 30, June 30, 2018 2017 2018 2017 (in thousands, except per share amounts) Net income available to common stockholders $ 14,669 $ 13,932 $ 28,584 $ 23,438 Weighted average common shares outstanding used in computing basic income per share 32,214 30,589 32,154 30,183 Incremental options and RSUs 1,728 2,579 1,894 2,596 Weighted average common shares used in computing diluted net income per share 33,942 33,168 34,048 32,779 Net income per share Basic $ 0.46 $ 0.46 $ 0.89 $ 0.78 Diluted $ 0.43 $ 0.42 $ 0.84 $ 0.72

Accumulated Other Comprehensi23

Accumulated Other Comprehensive Income (Tables)	6 Months Ended
	Jun. 30, 2018
Accumulated Other Comprehensive Income
Schedule of changes in accumulated other comprehensive income, net of tax	Foreign Defined benefit currency pension plan Total (in thousands) Balance at December 31, 2017 $ 2,756 $ (580) $ 2,176 Other comprehensive income and pension reclassification (1,300) 60 (1,240) Balance at June 30, 2018 $ 1,456 $ (520) $ 936

Cash, cash equivalents and re24

Cash, cash equivalents and restricted cash (Tables)	6 Months Ended
	Jun. 30, 2018
Cash, cash equivalents and restricted cash
Schedule of reconciliation of cash, cash equivalents and restricted cash	June 30, 2018 2017 (in thousands) Cash and cash equivalents $ $ Short-term and long-term restricted cash Total cash, cash equivalents and restricted cash $ $

Inventories, net (Tables)

Inventories, net (Tables)	6 Months Ended
	Jun. 30, 2018
Inventories, net
Schedule of components of inventories	June 30, December 31, 2018 2017 (in thousands) Raw materials $ 85,077 $ 82,313 Work in process 34,560 31,651 Finished goods (completed systems) 9,917 6,580 Inventories, net $ 129,554 $ 120,544

Product Warranty (Tables)

Product Warranty (Tables)	6 Months Ended
	Jun. 30, 2018
Product Warranty
Schedule of product warranty liability	Six months ended June 30, 2018 2017 (in thousands) Balance at January 1 (beginning of year) $ 4,502 $ 2,666 Warranties issued during the period 3,124 2,577 Settlements made during the period (2,892) (1,090) Changes in estimate of liability for pre-existing warranties during the period 411 (281) Balance at June 30 (end of period) $ 5,145 $ 3,872 Amount classified as current $ 4,698 $ 3,537 Amount classified as long-term 447 335 Total warranty liability $ 5,145 $ 3,872

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	6 Months Ended
	Jun. 30, 2018
Fair Value Measurements
Schedule of Company's assets and liabilities by level within the fair value hierarchy	June 30, 2018 Fair Value Measurements Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Money market funds, U.S. Government Securities and Agency Investments $ 129,620 $ — $ — $ 129,620 December 31, 2017 Fair Value Measurements Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Money market funds, U.S. Government Securities and Agency Investments $ 116,433 $ — $ — $ 116,433

Recent Accounting Guidance (Tab

Recent Accounting Guidance (Tables)	6 Months Ended
	Jun. 30, 2018
ASU 2014-09
Recent Accounting Guidance
Schedule of new accounting pronouncements and changes in accounting principles	In accordance with the new revenue standard requirements, the disclosure of the impact of adoption on our consolidated statement of operations for the three and six months ended June 30, 2018 and consolidated balance sheet as of June 30, 2018 was as follows (in thousands): Three months ended Six months ended June 30, 2018 June 30, 2018 Consolidated Statement of Operations As Reported ASC 606 Pro Forma Under ASC 605 As Reported ASC 606 Pro Forma Under ASC 605 Revenue: Product $ 112,521 $ (830) $ 111,691 $ 228,543 $ (1,836) $ 226,707 Total revenue 119,333 (830) 118,503 241,518 (1,836) 239,682 Gross profit 49,000 (830) 48,170 96,156 (1,836) 94,320 Income from operations 19,267 (830) 18,437 37,769 (1,836) 35,933 Income before income taxes 17,639 (830) 16,809 35,112 (1,836) 33,276 Income tax provision 2,970 (166) 2,804 6,528 (398) 6,130 Net income $ 14,669 $ (664) $ 14,005 $ 28,584 $ (1,438) $ 27,146 Net income per share: Basic $ 0.46 $ (0.02) $ 0.44 $ 0.89 $ (0.04) $ 0.85 Diluted $ 0.43 $ (0.02) $ 0.41 $ 0.84 $ (0.04) $ 0.80 June 30, 2018 Consolidated Balance Sheet As Reported ASC 606 Pro Forma Under ASC 605 Deferred income taxes $ 77,005 $ 398 $ 77,403 Total assets $ 508,431 $ 398 $ 508,829 Deferred revenue $ 15,175 $ 2,430 $ 17,605 Total current liabilities 66,690 2,430 69,120 Total liabilities 122,817 2,430 125,247 Accumulated deficit (174,561) (2,032) (176,593) Total stockholders' equity 385,614 (2,032) 383,582 Total liabilities and stockholders' equity $ 508,431 $ 398 $ 508,829

Stock-Based Compensation (Detai

Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Stock-Based Compensation
Stock-based compensation expense	$ 2,100	$ 1,500	$ 3,200	$ 2,600
Proceeds from exercise of stock options			$ 822	$ 9,290
Common Stock
Stock-Based Compensation
Exercise of stock options (in shares)	200,000	1,200,000	300,000	1,700,000
Proceeds from exercise of stock options	$ 900	$ 7,100	$ 1,300	$ 9,600
2000 Stock Plan
Stock-Based Compensation
Number of shares of common stock available for future grant	0		0

Revenue (Details)

Revenue (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2018	Jan. 01, 2018	Dec. 31, 2017
Disaggregation of Revenue
Product warranty period		1 year
Change in contract liabilities	$ (3,000)	$ (3,000)
Contract liabilities	15,175	15,175		$ 18,145
Deferred revenue	11,927	11,927		16,181
Long-term deferred revenue	3,248	3,248		$ 1,964
ASC 606 Adjustments
Disaggregation of Revenue
Contract liabilities	2,430	2,430
ASC 606 Adjustments | ASU 2014-09
Disaggregation of Revenue
Change in contract liabilities	(1,600)	$ (1,600)	$ (1,600)
ASC 606 Adjustments | Maximum
Disaggregation of Revenue
Unsatisfied extended warranty performance obligations, period		24 months
Systems
Disaggregation of Revenue
Payment upon shipment of tool, as a percent		90.00%
Payment upon installation, as a percent		10.00%
Systems | Minimum
Disaggregation of Revenue
Payment upon delivery of parts, period		30 days
Systems | Maximum
Disaggregation of Revenue
Payment upon delivery of parts, period		60 days
Systems | ASC 606 Adjustments
Disaggregation of Revenue
Increase in revenue	$ 800	$ 1,800
Aftermarket | Minimum
Disaggregation of Revenue
Extended warranty period		1 year
Aftermarket | Maximum
Disaggregation of Revenue
Extended warranty period		3 years

Revenue - Revenue by discipline

Revenue - Revenue by discipline & geographical areas (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Disaggregation of Revenue
Revenue	$ 119,333		$ 241,518
North America
Disaggregation of Revenue
Revenue	16,485		27,008
Asia
Disaggregation of Revenue
Revenue	88,471		186,160
Europe
Disaggregation of Revenue
Revenue	14,377		28,350
Systems
Disaggregation of Revenue
Revenue	73,919		159,395
Aftermarket
Disaggregation of Revenue
Revenue	45,414		82,123
Before Topic 606
Disaggregation of Revenue
Revenue	118,503	$ 102,790	239,682	$ 189,683
Before Topic 606 | North America
Disaggregation of Revenue
Revenue		12,400		19,399
Before Topic 606 | Asia
Disaggregation of Revenue
Revenue		81,103		144,347
Before Topic 606 | Europe
Disaggregation of Revenue
Revenue		9,287		25,937
Before Topic 606 | Systems
Disaggregation of Revenue
Revenue		62,440		117,691
Before Topic 606 | Aftermarket
Disaggregation of Revenue
Revenue		$ 40,350		$ 71,992
ASC 606 Adjustments
Disaggregation of Revenue
Revenue	(830)		(1,836)
ASC 606 Adjustments | North America
Disaggregation of Revenue
Revenue	100		(300)
ASC 606 Adjustments | Asia
Disaggregation of Revenue
Revenue	800		2,300
ASC 606 Adjustments | Europe
Disaggregation of Revenue
Revenue	$ (100)		$ (200)

Revenue - Contract assets and l

Revenue - Contract assets and liabilities (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Revenue
Contract liabilities	$ 15,175		$ 15,175		$ 18,145
Revenue recognized in the period from:
Amounts included in contract liability at the beginning of the period	$ 8,787	$ 3,780	$ 10,617	$ 7,066

Computation of Net Earnings p33

Computation of Net Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Computation of Net Earnings per Share
Net income available to common stockholders	$ 14,669	$ 13,932	$ 28,584	$ 23,438
Weighted average common shares outstanding used in computing basic income per share	32,214	30,589	32,154	30,183
Incremental options and RSUs	1,728	2,579	1,894	2,596
Weighted average common shares used in computing diluted net income per share	33,942	33,168	34,048	32,779
Net income per share
Basic	$ 0.46	$ 0.46	$ 0.89	$ 0.78
Diluted	$ 0.43	$ 0.42	$ 0.84	$ 0.72
Weighted average number diluted shares outstanding adjustment	300	6	10	300

Accumulated Other Comprehensi34

Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Changes in accumulated other comprehensive income, net of tax
Balance at December 31, 2017			$ 2,176
Other comprehensive income and pension reclassification	$ (2,291)	$ 518	(1,240)	$ 2,461
Balance at June 30, 2018	936		936
Foreign currency
Changes in accumulated other comprehensive income, net of tax
Balance at December 31, 2017			2,756
Other comprehensive income and pension reclassification			(1,300)
Balance at June 30, 2018	1,456		1,456
Defined benefit pension plan
Changes in accumulated other comprehensive income, net of tax
Balance at December 31, 2017			(580)
Other comprehensive income and pension reclassification			60
Balance at June 30, 2018	$ (520)		$ (520)

Cash, cash equivalents and re35

Cash, cash equivalents and restricted cash (Details) $ in Thousands	Jun. 30, 2018USD ($)item	Dec. 31, 2017USD ($)	Jun. 30, 2017USD ($)	Dec. 31, 2016USD ($)
Cash and cash equivalents	$ 147,297	$ 133,407	$ 108,558
Short-term and long-term restricted cash	7,645		6,793
Total cash, cash equivalents and long-term restricted cash	154,942	$ 140,880	115,351	$ 77,655
Letter of credit related to workers' compensation insurance	$ 800
Number of bank guaranties | item	2
Letter of credit associated with bank guarantee one	$ 700
Letter of credit associated with bank guarantee two	100
Deposit related to customs activity	100
Revolving credit facility
Restricted cash which relates to support of outstanding letters of credit	7,600		$ 6,800
Revolving credit facility | Beverly Property Owner LLC
Letter of credit associated with security deposit for leaseback transaction	$ 5,900

Inventories, net (Details)

Inventories, net (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Inventories, net
Raw materials	$ 85,077	$ 82,313
Work in process	34,560	31,651
Finished goods (completed systems)	9,917	6,580
Inventories, net	$ 129,554	$ 120,544

Product Warranty (Details)

Product Warranty (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017
Product Warranty
Product warranty period	1 year
Changes in standard product warranty liability
Balance at January 1 (beginning of year)	$ 4,502	$ 2,666
Warranties issued during the period	3,124	2,577
Settlements made during the period	(2,892)	(1,090)
Changes in estimate of liability for pre-existing warranties during the period	411	(281)
Balance at June 30 (end of period)	5,145	3,872
Product warranty classification
Amount classified as current			$ 4,698	$ 4,112	$ 3,537
Amount classified as long-term			447		335
Total warranty liability	$ 4,502	$ 2,666	$ 5,145	$ 4,502	$ 3,872

Fair Value Measurements (Detail

Fair Value Measurements (Details) - Recurring - Money market funds, US Government Securities and Agency Investments - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Total
Fair Value Measurements
Money market funds, U.S. Government Securities and Agency Investments	$ 129,620	$ 116,433
Level 1
Fair Value Measurements
Money market funds, U.S. Government Securities and Agency Investments	$ 129,620	$ 116,433

Financing Arrangements (Details

Financing Arrangements (Details) - USD ($) $ in Thousands	Jan. 30, 2015	Jun. 30, 2018	Dec. 31, 2017
Financing Arrangements
Sale leaseback obligation		$ 47,735	$ 47,714
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 Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Income Taxes
Income tax provision	$ 2,970	$ (2,611)	$ 6,528	$ (2,600)
Tax benefit recognized upon the expiration of statute of limitation	300		300
Interest and penalties previously accrued credited to interest expenses	$ 200		$ 200
Deferred tax assets valuation allowance					$ 90,300
Federal statutory tax rate			21.00%		35.00%

Concentration of Risk (Details)

Concentration of Risk (Details) - customer	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Revenue | Customer concentration risk
Concentration of Risk
Number of customers	1	4	2	4
Revenue | Customer concentration risk | First customer
Concentration of Risk
Percentage of concentration risk	23.90%	27.30%	24.90%	22.30%
Revenue | Customer concentration risk | Second customer
Concentration of Risk
Percentage of concentration risk		21.60%	11.80%	19.20%
Revenue | Customer concentration risk | Third customer
Concentration of Risk
Percentage of concentration risk		12.80%		15.70%
Revenue | Customer concentration risk | Fourth customer
Concentration of Risk
Percentage of concentration risk		10.50%		13.30%
Consolidated accounts receivable | Credit concentration risk
Concentration of Risk
Number of customers			1		3
Consolidated accounts receivable | Credit concentration risk | First customer
Concentration of Risk
Percentage of concentration risk			10.00%		19.80%
Consolidated accounts receivable | Credit concentration risk | Second customer
Concentration of Risk
Percentage of concentration risk					11.80%
Consolidated accounts receivable | Credit concentration risk | Third customer
Concentration of Risk
Percentage of concentration risk					10.60%

Recent Accounting Guidance (Det

Recent Accounting Guidance (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Jan. 01, 2018	Dec. 31, 2017
Revenue:
Revenue	$ 119,333		$ 241,518
Gross profit	49,000	$ 39,062	96,156	$ 73,776
Income from operations	19,267	12,530	37,769	23,243
Income before income taxes	17,639	11,321	35,112	20,838
Income tax provision	2,970	(2,611)	6,528	(2,600)
Net income	$ 14,669	$ 13,932	$ 28,584	$ 23,438
Net income per share:
Basic (in dollars per share)	$ 0.46	$ 0.46	$ 0.89	$ 0.78
Diluted (in dollars per share)	$ 0.43	$ 0.42	$ 0.84	$ 0.72
Consolidated Balance Sheet
Deferred income taxes	$ 77,005		$ 77,005			$ 83,148
Total assets	508,431		508,431			488,218
Deferred revenue	15,175		15,175			18,145
Total current liabilities	66,690		66,690			79,287
Total liabilities	122,817		122,817			134,608
Accumulated deficit	(174,561)		(174,561)			(204,745)
Total stockholders' equity	385,614		385,614			353,610
Total liabilities and stockholders' equity	508,431		508,431			$ 488,218
Cumulative adjustment in deferred revenue	3,000		3,000
Product
Revenue:
Revenue	112,521		228,543
ASC 606 Adjustments
Revenue:
Revenue	(830)		(1,836)
Gross profit	(830)		(1,836)
Income from operations	(830)		(1,836)
Income before income taxes	(830)		(1,836)
Income tax provision	(166)		(398)
Net income	$ (664)		$ (1,438)
Net income per share:
Basic (in dollars per share)	$ (0.02)		$ (0.04)
Diluted (in dollars per share)	$ (0.02)		$ (0.04)
Consolidated Balance Sheet
Deferred income taxes	$ 398		$ 398
Total assets	398		398
Deferred revenue	2,430		2,430
Total current liabilities	2,430		2,430
Total liabilities	2,430		2,430
Accumulated deficit	(2,032)		(2,032)
Total stockholders' equity	(2,032)		(2,032)
Total liabilities and stockholders' equity	398		398
ASC 606 Adjustments | Product
Revenue:
Revenue	(830)		(1,836)
ASC 606 Adjustments | ASU 2014-09
Consolidated Balance Sheet
Cumulative adjustment increase in retained earnings					$ 1,600
Cumulative adjustment in deferred revenue	1,600		1,600		$ 1,600
Before Topic 606
Revenue:
Revenue	118,503	$ 102,790	239,682	$ 189,683
Gross profit	48,170		94,320
Income from operations	18,437		35,933
Income before income taxes	16,809		33,276
Income tax provision	2,804		6,130
Net income	$ 14,005		$ 27,146
Net income per share:
Basic (in dollars per share)	$ 0.44		$ 0.85
Diluted (in dollars per share)	$ 0.41		$ 0.80
Consolidated Balance Sheet
Deferred income taxes	$ 77,403		$ 77,403
Total assets	508,829		508,829
Deferred revenue	17,605		17,605
Total current liabilities	69,120		69,120
Total liabilities	125,247		125,247
Accumulated deficit	(176,593)		(176,593)
Total stockholders' equity	383,582		383,582
Total liabilities and stockholders' equity	508,829		508,829
Before Topic 606 | Product
Revenue:
Revenue	$ 111,691		$ 226,707