PDF Solutions (PDFS) 10-Q 6 Nov 17 2017 Q3 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2017	Oct. 30, 2017
Document Information [Line Items]
Entity Registrant Name	PDF SOLUTIONS INC
Entity Central Index Key	1,120,914
Trading Symbol	pdfs
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Entity Common Stock, Shares Outstanding (in shares)		31,947,582
Document Type	10-Q
Document Period End Date	Sep. 30, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q3
Amendment Flag	false

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 100,750	$ 116,787
Accounts receivable, net of allowance of $324 and $200, respectively	52,954	48,157
Prepaid expenses and other current assets	6,580	5,335
Total current assets	160,284	170,279
Property and equipment, net	23,604	19,341
Goodwill	1,923	215
Intangible assets, net	6,325	4,223
Deferred tax assets	18,522	15,640
Other non-current assets	11,312	12,631
Total assets	221,970	222,329
Current liabilities:
Accounts payable	2,608	2,206
Accrued compensation and related benefits	5,450	5,959
Accrued and other current liabilities	2,436	2,080
Deferred revenues – current portion	7,624	8,189
Billings in excess of recognized revenue	289	88
Total current liabilities	18,407	18,522
Long-term income taxes payable	2,914	3,354
Other non-current liabilities	2,352	1,650
Total liabilities	23,673	23,526
Commitments and contingencies (Note 9)
Stockholders’ equity:
Preferred stock, $0.00015 par value, 5,000 shares authorized, no shares issued and outstanding	0	0
Common stock, $0.00015 par value, 70,000 shares authorized: shares issued 39,506 and 38,514, respectively; shares outstanding 31,882 and 31,864, respectively	5	5
Additional paid-in-capital	294,359	281,423
Treasury stock at cost, 7,625 and 6,650 shares, respectively	(70,739)	(54,882)
Accumulated deficit	(24,455)	(25,752)
Accumulated other comprehensive loss	(873)	(1,991)
Total stockholders’ equity	198,297	198,803
Total liabilities and stockholders’ equity	$ 221,970	$ 222,329

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) shares in Thousands, $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Accounts receivable, allowance	$ 324	$ 200
Preferred stock, par value (in dollars per share)	$ 0.00015	$ 0.00015
Preferred stock, shares authorized (in shares)	5,000	5,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.00015	$ 0.00015
Common stock, shares authorized (in shares)	70,000	70,000
Common stock, shares issued (in shares)	39,506	38,514
Common stock, shares outstanding (in shares)	31,882	31,864
Treasury stock, shares (in shares)	7,625	6,650

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Revenues:
Design-to-silicon-yield solutions	$ 19,229	$ 18,552	$ 55,426	$ 57,704
Gainshare performance incentives	7,288	8,707	19,668	21,324
Total revenues	26,517	27,259	75,094	79,028
Costs of Design-to-silicon-yield solutions:
Direct costs of Design-to-silicon-yield solutions	12,295	11,366	34,913	32,034
Amortization of acquired technology	136	86	327	278
Total cost of Design-to-silicon-yield solutions	12,431	11,452	35,240	32,312
Gross profit	14,086	15,807	39,854	46,716
Operating expenses:
Research and development	7,875	7,017	22,432	20,388
Selling, general and administrative	5,680	5,548	17,775	15,766
Amortization of other acquired intangible assets	107	106	291	340
Total operating expenses	13,662	12,671	40,498	36,494
Income (loss) from operations	424	3,136	(644)	10,222
Interest and other expense, net	(104)	(101)	(305)	(389)
Income (loss) before income taxes	320	3,035	(949)	9,833
Income tax provision (benefit)	(270)	1,051	(2,246)	3,655
Net income	$ 590	$ 1,984	$ 1,297	$ 6,178
Net income per share:
Basic (in dollars per share)	$ 0.02	$ 0.06	$ 0.04	$ 0.20
Diluted (in dollars per share)	$ 0.02	$ 0.06	$ 0.04	$ 0.19
Weighted average common shares:
Basic (in shares)	32,078	31,413	32,060	31,286
Diluted (in shares)	32,969	32,578	33,317	32,144
Net income	$ 590	$ 1,984	$ 1,297	$ 6,178
Other comprehensive income:
Foreign currency translation adjustments, net of tax	409	157	1,117	331
Comprehensive income	$ 999	$ 2,141	$ 2,414	$ 6,509

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016
Operating activities:
Net income	$ 1,297	$ 6,178
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	3,549	2,584
Stock-based compensation expense	8,737	7,935
Amortization of acquired intangible assets	618	617
Deferred taxes	(3,514)	1,083
Loss on disposal of property and equipment	5	107
Provision for (reversal of) allowance for doubtful accounts	124	(99)
Unrealized loss (gain) on foreign currency forward contract	(6)	(54)
Changes in operating assets and liabilities:
Accounts receivable, net of allowance	(4,921)	(10,486)
Prepaid expenses and other current assets	(1,142)	(1,486)
Accounts payable	1,611	33
Accrued compensation and related benefits	(721)	277
Accrued and other liabilities	(225)	139
Deferred revenues	(682)	3,959
Billings in excess of recognized revenues	200	(1,194)
Other non-current assets	1,331	(7,764)
Net cash provided by operating activities	6,261	1,829
Investing activities:
Payments for business acquisitions, net of cash acquired	(3,841)
Purchases of property and equipment	(6,942)	(8,860)
Net cash used in investing activities	(10,783)	(8,860)
Financing activities:
Proceeds from exercise of stock options	2,304	1,132
Proceeds from employee stock purchase plan	1,866	1,558
Repurchases of common stock	(13,418)	(2,182)
Payments for taxes related to net share settlement of equity awards	(2,439)	(1,161)
Net cash used in financing activities	(11,687)	(653)
Effect of exchange rate changes on cash and cash equivalents	172	60
Net change in cash and cash equivalents	(16,037)	(7,624)
Cash and cash equivalents, beginning of period	116,787	126,158
Cash and cash equivalents, end of period	100,750	118,534
Supplemental disclosure of cash flow information:
Taxes	1,876	2,616
Property and equipment received and accrued in accounts payable and accrued and other liabilities	$ 1,533	$ 913

Note 1 - Basis of Presentation

Note 1 - Basis of Presentation	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	1. Basis of Presentation The interim unaudited condensed consolidated financial statements included herein have been prepared by PDF Solutions, Inc. (the “Company”) pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), including the instructions to the Quarterly Report on Form 10 10 X. not may ’s Annual Report on Form 10 December 31, 2016. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries after the elimination of all intercompany balances and transactions. The condensed consolidated balance sheet at December 31, 2016, has been derived from the audited consolidated financial statements but does not Use of Estimates — The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates in these financial statements include revenue recognition for fixed-price solution implementation service contracts, accounting for goodwill and intangible assets, stock-based compensation expense and accounting for income taxes. Actual results could differ from those estimates. Revenue Recognition — The Company derives revenue from two Design-to-silicon-yield solutions — Revenues that are derived from Design-to-silicon-yield solutions come from services and software and hardware licenses. The Company recognizes revenue for each element of Design-to-silicon-yield solutions as follows: The Company generates a significant portion of its Design-to-silicon-yield solutions revenue from fixed-price solution implementation service contracts delivered over a specific period of time. These contracts require reliable estimation of costs to perform obligations and the overall scope of each engagement. Revenue under project –based contracts for solution implementation services is recognized as services are performed using percentage of completion method of contract accounting based on costs or labor-hours input method, whichever is the most appropriate measure of the progress towards completion of the contract. Losses on fixed-price solution implementation contracts are recognized in the period when they become probable. Revisions in profit estimates are reflected in the period in which the conditions that require the revisions become known and can be estimated (cumulative catch-up method). Revenue under time and materials contracts for solution implementation services are recognized as the services are performed. On occasion, the Company licenses its software products as a component of its fixed-price service contracts. In such instances, the software products are licensed to customers over a specified term of the agreement with support and maintenance to be provided, if applicable, over the license term. The amount of product and service revenue recognized in a given period is affected by the Company ’s judgment as to whether an arrangement includes multiple deliverables and, if so, the Company’s determination of the fair value of each deliverable. In general, vendor-specific objective evidence of selling price (“VSOE”) does not not third not In some instances, the Company also licenses its Design-For-Inspection (“DFI”) system as a separate component of fixed-price service contracts. The Company allocates revenue to all deliverables based on their relative selling prices. The Company currently does not The Company defers certain pre-contract costs incurred for specific anticipated contracts. Deferred costs consist primarily of direct costs to provide solution implementation services in relation to the specific anticipated contracts. The Company recognizes such costs as a component of cost of revenues, the timing of which is dependent upon persuasive evidence of contract arrangement assuming all other revenue recognition criteria are met. The Company also defers costs from arrangements that required us to defer the revenues, typically due to revenue recognition from multi-element arrangements or from contracts subject to customer acceptance. These costs are recognized in proportion to the related revenue. At the end of the reporting period, the Company evaluates its deferred costs for their probable recoverability. The Company recognizes impairment of deferred costs when it is determined that the costs no no was $0.6 $0.5 September 30, 2017 December 31, 2016, The Company also licenses its software products separately from solution implementations. For software license arrangements that do not 2 3 4 5 not 1 2 3 Revenue from software-as-a-service (SaaS) that allow for the use of a hosted software product or service over a contractually determined period of time without taking possession of software are accounted for as subscriptions and recognized as revenue ratably over the coverage period beginning on the date the service is made available to customers. Revenue for software licenses with extended payment terms is not Deferred revenues consist substantially of amounts invoiced in advance of revenue recognition and is recognized as the revenue recognition criteria are met. Deferred revenues that will be recognized during the succeeding 12 was $1.6 $1.5 September 30, 2017 December 31, 2016. Gainshare Performance Incentives — When the Company enters into a contract to provide yield improvement services, the contract usually includes two 1 2 may no

Note 2 - Recent Accounting Pron

Note 2 - Recent Accounting Pronouncements	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
New Accounting Pronouncements and Changes in Accounting Principles [Text Block]	2. In May 2014, No. 2014 09, 606 No. 2015 14, 606 2016 08, 606 No. 2016 10, 606 No. 2016 11, 605 815 No. 2016 12, 606 2016 20, 606 , and ASU 2017 13, 605 840 842 July 20, 2017 five December 15, 2017, two In February 2016, No. 2016 02, 842 ’ financial statements issued for fiscal years beginning after December 15, 2018, In August 2016, No. 2016 15, December 15, 2017, not In January 2017, No. 2017 01, December 15, 2017, not In January 2017, No. 2017 04, 350 No. 2017 04” No. 2017 04 2 December 15, 2019, not In May 2017, No. 2017 09, 718 (“ASU No. 2017 09” No. 2017 09 718. December 15, 2017,

Note 3 - Business Combinations

Note 3 - Business Combinations	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
Business Combination Disclosure [Text Block]	3. On July 11, 2017 ( The total purchase price was $4.3 $0.5 may July 11, 2019, $0.6 The Company accounted for this acquisition as a business combination. This method requires that assets acquired and liabilities assumed in a business combination be recognized at their fair values as of the Acquisition Date. The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill. The goodwill recorded from this acquisition represents business benefits the Company anticipates realizing from optimizing resources and new and expanded sales opportunities that extend the Company's footprint throughout the entire systems value chain. $1.7 Pro forma results of operations have not not Intangible assets consist of developed technology, customer relationships, and trademarks. The value assigned to intangibles are based on estimates and judgments regarding expectations for success and life cycle of intangibles acquired. The following table summarizes the allocation of the purchase consideration transferred to the fair value of the tangible and intangible assets acquired and liabilities assumed as of the acquisition date: (in thousands) Amortization period (years ) Finite-lived intangible assets: Developed technology 1,720 9 Customer relationship 820 9 Tradename 180 7 Deferred revenue (190 ) Other receivables 53 Net asset acquired 2,583 Goodwill 1,708 Purchase consideration $ 4,291

Note 4 - Balance Sheet Componen

Note 4 - Balance Sheet Components	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
Supplemental Balance Sheet Disclosures [Text Block]	4 . BALANCE SHEET COMPONENTS Accounts receivable include amounts that are unbilled at the end of the period that are expected to be billed and collected within 12 totaled $20.7 $20.8 September 30, 2017 December 31, 2016, not 12 $9.1 $9.8 September 30, 2017 December 31, 2016, $0.6 $0.5 September 30, 2017 December 31, 2016, Property and equipment, net consists of (in thousands): September 30, 2017 December 31, 2016 Property and equipment, net: Computer equipment $ 10,756 $ 10,642 Software 3,359 1,679 Furniture, fixtures and equipment 1,927 1,185 Leasehold improvements 1,983 1,132 DFI test equipment 5,341 3,367 Other test equipment 8,191 8,356 Construction-in-progress 11,837 9,550 43,394 35,911 Less: accumulated depreciation (19,790 ) (16,570 ) Total $ 23,604 $ 19,341 The construction-in-progress balance as of September 30, 2017 December 31, 2016 was $1.3 $1.0 three September 30, 2017 2016, $3.5 $2.6 nine September 30, 2017 2016, As of September 30, 2017 December 31, 2016, $1.9 $0.2 September 30, 2017 Balance as of December 31, 2016 $ 215 Add: Goodwill from acquisition 1,708 Adjustment — Balance as of September 30, 2017 $ 1,923 Intangible assets balance was $6.4 $4.2 September 30, 2017 December 31, 2016, September 30, 2017 December 31, 2016 September 30, 2017 December 31, 2016 Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Acquired identifiable intangibles: Customer relationships 1 - 9 $ 6,740 $ (4,054 ) $ 2,686 $ 5,920 $ (3,825 ) $ 2,095 Developed technology 4 - 6 15,820 (12,686 ) 3,134 14,100 (12,359 ) 1,741 Tradename 2 - 4 790 (615 ) 175 610 (583 ) 27 Backlog 1 100 (100 ) - 100 (100 ) - Patent 7 - 10 1,800 (1,470 ) 330 1,800 (1,440 ) 360 Other acquired intangibles 4 255 (255 ) - 255 (255 ) - Total $ 25,505 $ (19,180 ) $ 6,325 $ 22,785 $ (18,562 ) $ 4,223 The weighted average amortization period for acquired identifiable intangible assets was 6.96 September 30, 2017. three September 30, 2017 2016, $0.2 nine September 30, 2017 2016, $0.6 Period Ending September 30, 2017 (remaining 3 months) $ 251 2018 1,009 2019 1,009 2020 1,009 2021 833 2022 and thereafter 2,214 Total future amortization expense $ 6,325 Intangible assets are amortized over their useful lives unless these lives are determined to be indefinite. Intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not three nine September 30, 2017, no

Note 5 - Stockholders' Equity

Note 5 - Stockholders' Equity	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
Shareholders' Equity and Share-based Payments [Text Block]	5 . STOCKHOLDERS’ EQUITY Stock-based compensation is estimated at the grant date based on the award ’s fair value and is recognized on a straight-line basis over the vesting periods, generally four . Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Cost of design-to-silicon yield-solutions $ 1,184 $ 1,191 $ 3,445 $ 3,232 Research and development 877 894 2,558 2,251 Selling, general and administrative 888 892 2,734 2,452 Stock-based compensation expenses $ 2,949 $ 2,977 $ 8,737 $ 7,935 On September 30, 2017, Stock Plans — At the annual meeting of stockholders on November 16, 2011, 2011 “2011 2011 may 9,050,000 3,500,000 2001 2001 November 16, 2011. 1.33 no ten four In 2001, adopted a 2001 “2001 2003, 2001 2001Plan 2011. 2001 ten four no may 2001 2001 The Company estimated the fair value of share-based awards granted under the 2011 Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Expected life (in years) 4.41 4.42 4.41 4.42 Volatility 41.49 % 42.97 % 41.53 % 43.82 % Risk-free interest rate 1.65 % 1.10 % 1.69 % 1.20 % Expected dividend — — — — Weighted average fair value per share of options granted during the period $ 5.78 $ 5.52 $ 6.14 $ 4.82 As of September 30, 2017, 9.6 2011 3.9 2011 0.5 2001 2011 September 30, 2017. September 30, 2017, no 2011 2001 Stock option activity under the Company ’s Stock Plans during the nine September 30, 2017, Number of Options (in thousands) Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding, January 1, 2017 1,364 $ 8.00 Granted (weighted average fair value of $6.1 4 per share) 100 $ 16.97 Exercised (366 ) $ 6.43 Canceled (16 ) $ 15.63 Expired (1 ) $ 18.10 Outstanding, September 30, 2017 1,081 $ 9.23 4.73 $ 7,133 Vested and expected to vest, September 30, 2017 1,065 $ 9.13 4.66 $ 7,124 Exercisable, September 30, 2017 893 $ 7.82 3.82 $ 6,966 The aggregate intrinsic value in the table above represents the total intrinsic value based on the Company ’s closing stock price of $15.49 September 30, 2017. nine September 30, 2017, $4.6 As of September 30, 2017, $1.0 3.3 nine September 30, 2017, $0.2 Nonvested restricted stock units activity during the nine September 30, 2017, Shares (in thousands) Weighted Average Grant Date Fair Value Per Share Nonvested, January 1, 2017 1,542 $ 15.50 Granted 793 $ 16.53 Vested (431 ) $ 15.78 Forfeited (99 ) $ 15.93 Nonvested, September 30, 2017 1,805 $ 15.86 As of September 30, 2017, $23.3 2.8 not Employee Stock Purchase Plan — In July 2001, ten 10% 85% twenty-four four six January 1 2002, 1 675,000 2 2% 3 May 18, 2010, May 17, 2020. The Company estimated the fair value of purchase rights granted under the Purchase Plan during the period using the Black-Scholes-Merton option-pricing model with the following weighted average assumptions, resulting in the following weighted average fair values: Nine Months Ended September 30, 2017 2016 Expected life (in years) 1.25 1.25 Volatility 40.63 % 44.00 % Risk-free interest rate 1.25 % 0.50 % Expected dividend — — Weighted average fair value per share of options granted during the period $ 5.22 $ 3.70 During the three September 30, 2017 2016, 99,550 88,543 $9.53 $8.81 nine September 30, 2017 2016, 199,827 173,001 $9.33 $9.00 September 30, 2017, $0.5 1.24 September 30, 2017, 4.3 Stock Repurchase Program —On October 25, 2016, $25.0 two three nine September 30, 2017, 565,903 842,182 September 30, 2017, 842,182 $15.93 $13.4 $11.6

Note 6 - Income Taxes

Note 6 - Income Taxes	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
Income Tax Disclosure [Text Block]	6 . INCOME TAXES Income tax provision decreased $ 5.9 nine September 30, 2017, $2.2 $3.7 nine September 30, 2016. 236.7% 37.3% nine September 30, 2017 2016, nine September 30, 2017, 2016, $1.6 income . The Company ’s total amount of unrecognized tax benefits, excluding interest and penalties, as of September 30, 2017, $12.7 $7.6 December 31, 2016, $11.9 $7.2 September 30, 2017, $2.9 $9.8 $5.1 The valuation allowance was approximately $7.5 $6.8 September 30, 2017 December 31, 2016, not not The Company conducts business globally and, as a result, files numerous consolidated and separate income tax returns in the U.S. federal, various state and foreign jurisdictions. Because the Company used some of the tax attributes carried forward from previous years to tax years that are still open, statutes of limitation remain open for all tax years to the extent of the attributes carried forward into tax year 2002 not

Note 7 - Net Income Per Share

Note 7 - Net Income Per Share	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
Earnings Per Share [Text Block]	7 . NET INCOME PER SHARE Basic net income per share is computed by dividing net income by weighted average number of common shares outstanding for the period (excluding outstanding stock options and shares subject to repurchase). Diluted net income per share is computed using the weighted-average number of common shares outstanding for the period plus the potential effect of dilutive securities which are convertible into common shares (using the treasury stock method), except in cases in which the effect would be anti-dilutive. The following is a reconciliation of the numerators and denominators used in computing basic and diluted net income per share (in thousands except per share amount): Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Numerator: Net income $ 590 $ 1,984 $ 1,297 $ 6,178 Denominator: Basic weighted average common shares outstanding 32,078 31,413 32,060 31,286 Dilutive effect of equity incentive plans 891 1,165 1,257 858 Diluted weighted average common shares outstanding 32,969 32,578 33,317 32,144 Net income per share: Basic $ 0.02 $ 0.06 $ 0.04 $ 0.20 Diluted $ 0.02 $ 0.06 $ 0.04 $ 0.19 The following table sets forth potential shares of common stock that are not Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Outstanding options 211 119 109 188 Nonvested restricted stock units 15 226 12 389 Employee Stock Purchase Plan 68 25 42 162 Total 294 370 163 739

Note 8 - Customer and Geographi

Note 8 - Customer and Geographic Information	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
Segment Reporting Disclosure [Text Block]	8 . CUSTOMER AND GEOGRAPHIC INFORMATION Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or group, in deciding how to allocate resources and in assessing performance. The Company ’s chief operating decision maker, the chief executive officer, reviews discrete financial information presented on a consolidated basis for purposes of regularly making operating decisions, allocation of resources, and assessing financial performance. Accordingly, the Company considers itself to be in one The Company had revenues from individual customers in excess of 10% Three Months Ended September 30, Nine Months Ended September 30, Customer 2017 2016 2017 2016 A 38 % 38 % 41 % 42 % B * % 12 % * % 12 % * represents less than 10% The Company had gross accounts receivable from individual customers in excess of 10% Customer September 30, 2017 December 31, 2016 A 44 % 42 % C 15 % 13 % * represents less than 10% Revenues from customers by geographic area based on the location of the customers ’ work sites are as follows (in thousands): Three Months Ended September 30, 2017 2016 Revenues Percentage of Revenues Revenues Percentage of Revenues United States $ 9,750 37 % $ 8,680 32 % China 6,452 24 2,907 11 Germany 2,729 10 4,896 18 Taiwan 2,414 9 4,079 15 South Korea 1,539 6 3,027 11 Rest of the world 3,633 14 3,670 13 Total revenue $ 26,517 100 % $ 27,259 100 % Nine Months Ended September 30, 2017 2016 Revenues Percentage of Revenues Revenues Percentage of Revenues United States $ 30,610 41 % $ 30,320 38 % China 12,891 17 5,506 7 Taiwan 9,894 13 11,988 15 Germany 6,831 9 11,924 15 South Korea 5,159 7 8,523 11 Rest of the world 9,709 13 10,767 14 Total revenue $ 75,094 100 % $ 79,028 100 % Long-lived assets, net by geographic area are as follows (in thousands): September 30, 2017 December 31, 2016 United States $ 23,117 $ 18,818 Rest of the world 487 523 Total long-lived assets, net $ 23,604 $ 19,341

Note 9 - Fair Value Measurement

Note 9 - Fair Value Measurements	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
Fair Value Disclosures [Text Block]	9 . FAIR VALUE MEASUREMENTS Fair value is the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The multiple assumptions used to value financial instruments are referred to as inputs, and a hierarchy for inputs used in measuring fair value is established, that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources while unobservable inputs reflect a reporting entity ’s pricing based upon its own market assumptions. These inputs are ranked according to a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three Level 1 Inputs are quoted prices in active markets for identical assets or liabilities. Level 2 Inputs are quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not Level 3 Inputs are derived from valuation techniques in which one The following table represents the Company ’s assets measured at fair value on a recurring basis as of September 30, 2017, Assets Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Money market mutual funds $ 26,577 $ 26,577 $ — $ — The following table represents the Company ’s assets measured at fair value on a recurring basis as of December 31, 2016, Assets Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Money market mutual funds $ 26,456 $ 26,456 $ — $ — The Company enters into foreign currency forward contracts to reduce the exposure to foreign currency exchange rate fluctuations on certain foreign currency denominated monetary assets and liabilities, primarily on third ’s hedging program is to reduce volatility of earnings related to foreign currency exchange rate fluctuations. The counterparty to these foreign currency forward contracts is a large global financial institution that the Company believes is creditworthy, and therefore, the Company believes the credit risk of counterparty nonperformance is not not three September 30, 2017 2016, $0.2 $37,000 nine September 30, 2017 2016, $0.7 $45,000 The Company carries these derivatives financial instruments on its Consolidated Balance Sheets at their fair values. The Company ’s foreign currency forward contracts are classified as Level 2 not September 30, 2017, one $8.0 $10,000 December 31, 2016, one $6.9 $15,000

Note 10 - Commitments and Conti

Note 10 - Commitments and Contingencies	9 Months Ended
	Sep. 30, 2017
Notes to Financial Statements
Commitments and Contingencies Disclosure [Text Block]	10 . COMMITMENTS AND CONTINGENCIES Leases The Company leases administrative and sales offices and certain equipment under noncancelable operating leases, which contain various renewal options and, in some cases, require payment of common area costs, taxes and utilities. These operating leases expire at various times through 2024. was $0.6 three September 30, 2017 2016, $1.6 $1.7 nine September 30, 2017 2016. Future minimum lease payments under noncancelable operating leases at September 30, 2017, Period Ending September 30, Amount 2017 (remaining three months) $ 544 2018 1,757 2019 532 2020 444 2021 360 2022 and thereafter 126 Total future minimum lease payments $ 3,763 Indemnifications — The Company generally provides a warranty to its customers that its software will perform substantially in accordance with documented specifications typically for a period of 90 third not Purchase obligations September 30, 2017, $8.3 12 Indemnification of Officers and Directors In addition, the Bylaws of the Company provide that the Company is required to indemnify its officers and directors even when indemnification would otherwise be discretionary, and the Company is required to advance expenses to its officers and directors as incurred in connection with proceedings against them for which they may may ’ and officers’ insurance if available on reasonable terms. The Company has obtained directors’ and officers’ liability insurance in amounts comparable to other companies of the Company’s size and in the Company’s industry. Since a maximum obligation of the Company is not Litigation September 30, 2017, not no no

Significant Accounting Policies

Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2017
Accounting Policies [Abstract]
Basis of Accounting, Policy [Policy Text Block]	Basis of Presentation The interim unaudited condensed consolidated financial statements included herein have been prepared by PDF Solutions, Inc. (the “Company”) pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), including the instructions to the Quarterly Report on Form 10 10 X. not may ’s Annual Report on Form 10 December 31, 2016. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries after the elimination of all intercompany balances and transactions. The condensed consolidated balance sheet at December 31, 2016, has been derived from the audited consolidated financial statements but does not
Use of Estimates, Policy [Policy Text Block]	Use of Estimates — The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates in these financial statements include revenue recognition for fixed-price solution implementation service contracts, accounting for goodwill and intangible assets, stock-based compensation expense and accounting for income taxes. Actual results could differ from those estimates.
Revenue Recognition, Policy [Policy Text Block]	Revenue Recognition — The Company derives revenue from two Design-to-silicon-yield solutions — Revenues that are derived from Design-to-silicon-yield solutions come from services and software and hardware licenses. The Company recognizes revenue for each element of Design-to-silicon-yield solutions as follows: The Company generates a significant portion of its Design-to-silicon-yield solutions revenue from fixed-price solution implementation service contracts delivered over a specific period of time. These contracts require reliable estimation of costs to perform obligations and the overall scope of each engagement. Revenue under project –based contracts for solution implementation services is recognized as services are performed using percentage of completion method of contract accounting based on costs or labor-hours input method, whichever is the most appropriate measure of the progress towards completion of the contract. Losses on fixed-price solution implementation contracts are recognized in the period when they become probable. Revisions in profit estimates are reflected in the period in which the conditions that require the revisions become known and can be estimated (cumulative catch-up method). Revenue under time and materials contracts for solution implementation services are recognized as the services are performed. On occasion, the Company licenses its software products as a component of its fixed-price service contracts. In such instances, the software products are licensed to customers over a specified term of the agreement with support and maintenance to be provided, if applicable, over the license term. The amount of product and service revenue recognized in a given period is affected by the Company ’s judgment as to whether an arrangement includes multiple deliverables and, if so, the Company’s determination of the fair value of each deliverable. In general, vendor-specific objective evidence of selling price (“VSOE”) does not not third not In some instances, the Company also licenses its Design-For-Inspection (“DFI”) system as a separate component of fixed-price service contracts. The Company allocates revenue to all deliverables based on their relative selling prices. The Company currently does not The Company defers certain pre-contract costs incurred for specific anticipated contracts. Deferred costs consist primarily of direct costs to provide solution implementation services in relation to the specific anticipated contracts. The Company recognizes such costs as a component of cost of revenues, the timing of which is dependent upon persuasive evidence of contract arrangement assuming all other revenue recognition criteria are met. The Company also defers costs from arrangements that required us to defer the revenues, typically due to revenue recognition from multi-element arrangements or from contracts subject to customer acceptance. These costs are recognized in proportion to the related revenue. At the end of the reporting period, the Company evaluates its deferred costs for their probable recoverability. The Company recognizes impairment of deferred costs when it is determined that the costs no no was $0.6 $0.5 September 30, 2017 December 31, 2016, The Company also licenses its software products separately from solution implementations. For software license arrangements that do not 2 3 4 5 not 1 2 3 Revenue from software-as-a-service (SaaS) that allow for the use of a hosted software product or service over a contractually determined period of time without taking possession of software are accounted for as subscriptions and recognized as revenue ratably over the coverage period beginning on the date the service is made available to customers. Revenue for software licenses with extended payment terms is not Deferred revenues consist substantially of amounts invoiced in advance of revenue recognition and is recognized as the revenue recognition criteria are met. Deferred revenues that will be recognized during the succeeding 12 was $1.6 $1.5 September 30, 2017 December 31, 2016. Gainshare Performance Incentives — When the Company enters into a contract to provide yield improvement services, the contract usually includes two 1 2 may no

Note 3 - Business Combinations

Note 3 - Business Combinations (Tables)	9 Months Ended
	Sep. 30, 2017
Notes Tables
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]	(in thousands) Amortization period (years ) Finite-lived intangible assets: Developed technology 1,720 9 Customer relationship 820 9 Tradename 180 7 Deferred revenue (190 ) Other receivables 53 Net asset acquired 2,583 Goodwill 1,708 Purchase consideration $ 4,291

Note 4 - Balance Sheet Compon18

Note 4 - Balance Sheet Components (Tables)	9 Months Ended
	Sep. 30, 2017
Notes Tables
Property, Plant and Equipment [Table Text Block]	September 30, 2017 December 31, 2016 Property and equipment, net: Computer equipment $ 10,756 $ 10,642 Software 3,359 1,679 Furniture, fixtures and equipment 1,927 1,185 Leasehold improvements 1,983 1,132 DFI test equipment 5,341 3,367 Other test equipment 8,191 8,356 Construction-in-progress 11,837 9,550 43,394 35,911 Less: accumulated depreciation (19,790 ) (16,570 ) Total $ 23,604 $ 19,341
Schedule of Goodwill [Table Text Block]	September 30, 2017 Balance as of December 31, 2016 $ 215 Add: Goodwill from acquisition 1,708 Adjustment — Balance as of September 30, 2017 $ 1,923
Schedule of Finite-Lived Intangible Assets [Table Text Block]	September 30, 2017 December 31, 2016 Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Acquired identifiable intangibles: Customer relationships 1 - 9 $ 6,740 $ (4,054 ) $ 2,686 $ 5,920 $ (3,825 ) $ 2,095 Developed technology 4 - 6 15,820 (12,686 ) 3,134 14,100 (12,359 ) 1,741 Tradename 2 - 4 790 (615 ) 175 610 (583 ) 27 Backlog 1 100 (100 ) - 100 (100 ) - Patent 7 - 10 1,800 (1,470 ) 330 1,800 (1,440 ) 360 Other acquired intangibles 4 255 (255 ) - 255 (255 ) - Total $ 25,505 $ (19,180 ) $ 6,325 $ 22,785 $ (18,562 ) $ 4,223
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]	Period Ending September 30, 2017 (remaining 3 months) $ 251 2018 1,009 2019 1,009 2020 1,009 2021 833 2022 and thereafter 2,214 Total future amortization expense $ 6,325

Note 5 - Stockholders' Equity (

Note 5 - Stockholders' Equity (Tables)	9 Months Ended
	Sep. 30, 2017
Notes Tables
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block]	Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Cost of design-to-silicon yield-solutions $ 1,184 $ 1,191 $ 3,445 $ 3,232 Research and development 877 894 2,558 2,251 Selling, general and administrative 888 892 2,734 2,452 Stock-based compensation expenses $ 2,949 $ 2,977 $ 8,737 $ 7,935
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]	Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Expected life (in years) 4.41 4.42 4.41 4.42 Volatility 41.49 % 42.97 % 41.53 % 43.82 % Risk-free interest rate 1.65 % 1.10 % 1.69 % 1.20 % Expected dividend — — — — Weighted average fair value per share of options granted during the period $ 5.78 $ 5.52 $ 6.14 $ 4.82 Nine Months Ended September 30, 2017 2016 Expected life (in years) 1.25 1.25 Volatility 40.63 % 44.00 % Risk-free interest rate 1.25 % 0.50 % Expected dividend — — Weighted average fair value per share of options granted during the period $ 5.22 $ 3.70
Share-based Compensation, Stock Options, Activity [Table Text Block]	Number of Options (in thousands) Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding, January 1, 2017 1,364 $ 8.00 Granted (weighted average fair value of $6.1 4 per share) 100 $ 16.97 Exercised (366 ) $ 6.43 Canceled (16 ) $ 15.63 Expired (1 ) $ 18.10 Outstanding, September 30, 2017 1,081 $ 9.23 4.73 $ 7,133 Vested and expected to vest, September 30, 2017 1,065 $ 9.13 4.66 $ 7,124 Exercisable, September 30, 2017 893 $ 7.82 3.82 $ 6,966
Schedule of Share-based Compensation, Restricted Stock Units Award Activity [Table Text Block]	Shares (in thousands) Weighted Average Grant Date Fair Value Per Share Nonvested, January 1, 2017 1,542 $ 15.50 Granted 793 $ 16.53 Vested (431 ) $ 15.78 Forfeited (99 ) $ 15.93 Nonvested, September 30, 2017 1,805 $ 15.86

Note 7 - Net Income Per Share (

Note 7 - Net Income Per Share (Tables)	9 Months Ended
	Sep. 30, 2017
Notes Tables
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]	Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Numerator: Net income $ 590 $ 1,984 $ 1,297 $ 6,178 Denominator: Basic weighted average common shares outstanding 32,078 31,413 32,060 31,286 Dilutive effect of equity incentive plans 891 1,165 1,257 858 Diluted weighted average common shares outstanding 32,969 32,578 33,317 32,144 Net income per share: Basic $ 0.02 $ 0.06 $ 0.04 $ 0.20 Diluted $ 0.02 $ 0.06 $ 0.04 $ 0.19
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]	Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Outstanding options 211 119 109 188 Nonvested restricted stock units 15 226 12 389 Employee Stock Purchase Plan 68 25 42 162 Total 294 370 163 739

Note 8 - Customer and Geograp21

Note 8 - Customer and Geographic Information (Tables)	9 Months Ended
	Sep. 30, 2017
Notes Tables
Schedule of Revenue by Major Customers by Reporting Segments [Table Text Block]	Three Months Ended September 30, Nine Months Ended September 30, Customer 2017 2016 2017 2016 A 38 % 38 % 41 % 42 % B * % 12 % * % 12 %
Receivables by Major Customers [Table Text Block]	Customer September 30, 2017 December 31, 2016 A 44 % 42 % C 15 % 13 %
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block]	Three Months Ended September 30, 2017 2016 Revenues Percentage of Revenues Revenues Percentage of Revenues United States $ 9,750 37 % $ 8,680 32 % China 6,452 24 2,907 11 Germany 2,729 10 4,896 18 Taiwan 2,414 9 4,079 15 South Korea 1,539 6 3,027 11 Rest of the world 3,633 14 3,670 13 Total revenue $ 26,517 100 % $ 27,259 100 % Nine Months Ended September 30, 2017 2016 Revenues Percentage of Revenues Revenues Percentage of Revenues United States $ 30,610 41 % $ 30,320 38 % China 12,891 17 5,506 7 Taiwan 9,894 13 11,988 15 Germany 6,831 9 11,924 15 South Korea 5,159 7 8,523 11 Rest of the world 9,709 13 10,767 14 Total revenue $ 75,094 100 % $ 79,028 100 %
Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country [Table Text Block]	September 30, 2017 December 31, 2016 United States $ 23,117 $ 18,818 Rest of the world 487 523 Total long-lived assets, net $ 23,604 $ 19,341

Note 9 - Fair Value Measureme22

Note 9 - Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2017
Notes Tables
Fair Value, Assets Measured on Recurring Basis [Table Text Block]	Assets Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Money market mutual funds $ 26,577 $ 26,577 $ — $ — Assets Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Money market mutual funds $ 26,456 $ 26,456 $ — $ —

Note 10 - Commitments and Con23

Note 10 - Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2017
Notes Tables
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]	Period Ending September 30, Amount 2017 (remaining three months) $ 544 2018 1,757 2019 532 2020 444 2021 360 2022 and thereafter 126 Total future minimum lease payments $ 3,763

Note 1 - Basis of Presentation

Note 1 - Basis of Presentation (Details Textual) - USD ($) $ in Millions	Sep. 30, 2017	Dec. 31, 2016
Deferred Pre-contract Costs	$ 0.6	$ 0.5
Other Noncurrent Liabilities [Member]
Deferred Revenue, Noncurrent	$ 1.6	$ 1.5

Note 3 - Business Combination25

Note 3 - Business Combinations (Details Textual) - USD ($) $ in Thousands	Jul. 11, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Goodwill, Impairment Loss		$ 0	$ 0	$ 0
Impairment of Long-Lived Assets Held-for-use		$ 0	$ 0	$ 0
Kinesys Software [Member]
Payments to Acquire Businesses, Gross	$ 4,300
Business Combination Contingent Consideration at Fair Value	500
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High	600
Business Acquisition, Goodwill, Expected Tax Deductible Amount	$ 1,700

Note 3 - Business Combination26

Note 3 - Business Combinations - Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Jul. 11, 2017	Sep. 30, 2017	Dec. 31, 2016
Goodwill		$ 1,923	$ 215
Kinesys Software [Member]
Deferred revenue	$ (190)
Other receivables	53
Net asset acquired	2,583
Goodwill	1,708
Purchase consideration	4,291
Kinesys Software [Member] | Developed Technology Rights [Member]
Finite-lived intangible assets	$ 1,720
Finite-lived intangible assets, amortization period (Year)	9 years
Kinesys Software [Member] | Customer Relationships [Member]
Finite-lived intangible assets	$ 820
Finite-lived intangible assets, amortization period (Year)	9 years
Kinesys Software [Member] | Trade Names [Member]
Finite-lived intangible assets	$ 180
Finite-lived intangible assets, amortization period (Year)	7 years

Note 4 - Balance Sheet Compon27

Note 4 - Balance Sheet Components (Details Textual) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Unbilled Receivables, Current	$ 20,700		$ 20,700		$ 20,800
Unbilled Receivables, Not Billable, Amount Expected to be Collected after Next Twelve Months	9,100		9,100		9,800
Deferred Pre-contract Costs	600		600		500
Depreciation, Depletion and Amortization, Nonproduction	1,300	$ 1,000	3,500	$ 2,600
Goodwill	1,923		1,923		215
Finite-Lived Intangible Assets, Net	6,325		$ 6,325		$ 4,223
Finite-Lived Intangible Assets, Remaining Amortization Period			6 years 350 days
Amortization of Intangible Assets	200	200	$ 618	617
Impairment of Intangible Assets, Finite-lived	$ 0	$ 0	$ 0	$ 0

Note 4 - Balance Sheet Compon28

Note 4 - Balance Sheet Components - Property and Equipment (Details) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Property and equipment, gross	$ 43,394	$ 35,911
Less: accumulated depreciation	(19,790)	(16,570)
Total	23,604	19,341
Computer Equipment [Member]
Property and equipment, gross	10,756	10,642
Software and Software Development Costs [Member]
Property and equipment, gross	3,359	1,679
Furniture and Fixtures [Member]
Property and equipment, gross	1,927	1,185
Leasehold Improvements [Member]
Property and equipment, gross	1,983	1,132
DFI Test Equipment [Member]
Property and equipment, gross	5,341	3,367
Other Test Equipment [Member]
Property and equipment, gross	8,191	8,356
Construction in Progress [Member]
Property and equipment, gross	$ 11,837	$ 9,550

Note 4 - Balance Sheet Compon29

Note 4 - Balance Sheet Components - Goodwill Activity (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2017USD ($)
Balance	$ 215
Add: Goodwill from acquisition	1,708
Adjustment	0
Balance	$ 1,923

Note 4 - Balance Sheet Compon30

Note 4 - Balance Sheet Components - Intangible Assets (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2017	Dec. 31, 2016
Gross Carrying Amount	$ 25,505	$ 22,785
Accumulated Amortization	(19,180)	(18,562)
Intangible assets, net	6,325	4,223
Customer Relationships [Member]
Gross Carrying Amount	6,740	5,920
Accumulated Amortization	(4,054)	(3,825)
Intangible assets, net	$ 2,686	2,095
Customer Relationships [Member] | Minimum [Member]
Amortization Period (Year)	1 year
Customer Relationships [Member] | Maximum [Member]
Amortization Period (Year)	9 years
Developed Technology Rights [Member]
Gross Carrying Amount	$ 15,820	14,100
Accumulated Amortization	(12,686)	(12,359)
Intangible assets, net	$ 3,134	1,741
Developed Technology Rights [Member] | Minimum [Member]
Amortization Period (Year)	4 years
Developed Technology Rights [Member] | Maximum [Member]
Amortization Period (Year)	6 years
Trade Names [Member]
Gross Carrying Amount	$ 790	610
Accumulated Amortization	(615)	(583)
Intangible assets, net	$ 175	27
Trade Names [Member] | Minimum [Member]
Amortization Period (Year)	2 years
Trade Names [Member] | Maximum [Member]
Amortization Period (Year)	4 years
Order or Production Backlog [Member]
Amortization Period (Year)	1 year
Gross Carrying Amount	$ 100	100
Accumulated Amortization	(100)	(100)
Intangible assets, net
Patents [Member]
Gross Carrying Amount	1,800	1,800
Accumulated Amortization	(1,470)	(1,440)
Intangible assets, net	$ 330	360
Patents [Member] | Minimum [Member]
Amortization Period (Year)	7 years
Patents [Member] | Maximum [Member]
Amortization Period (Year)	10 years
Other Intangible Assets [Member]
Amortization Period (Year)	4 years
Gross Carrying Amount	$ 255	255
Accumulated Amortization	(255)	(255)
Intangible assets, net

Note 4 - Balance Sheet Compon31

Note 4 - Balance Sheet Components - Annual Amortization of Identifiable Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
2017 (remaining 3 months)	$ 251
2,018	1,009
2,019	1,009
2,020	1,009
2,021	833
2022 and thereafter	2,214
Total future amortization expense	$ 6,325	$ 4,223

Note 5 - Stockholders' Equity32

Note 5 - Stockholders' Equity (Details Textual) - USD ($) $ / shares in Units, $ in Millions	May 31, 2017	Oct. 25, 2016	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016	Dec. 31, 2001
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period					16,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number			1,081,000		1,081,000		1,364,000
Share Price			$ 15.49		$ 15.49
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value					$ 4.6
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value					$ 0.2
Stock Repurchase Program, Authorized Amount		$ 25
Stock Repurchase Program, Period in Force		2 years
Treasury Stock, Shares, Acquired			565,903		842,182
Treasury Stock Acquired, Average Cost Per Share					$ 15.93
Treasury Stock, Value, Acquired, Cost Method					$ 13.4
Stock Repurchase Program, Remaining Authorized Repurchase Amount			$ 11.6		11.6
Employee Stock Option [Member]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized			1		$ 1
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition					3 years 109 days
Restricted Stock Units (RSUs) [Member]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized			$ 23.3		$ 23.3
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition					2 years 292 days
Twenty Eleven Stock Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized	9,050,000
Share Based Compensation Arrangement By Share Based Payment Award Shares Reserved Decrease Rate	1.33
Common Stock, Capital Shares Reserved for Future Issuance			9,600,000		9,600,000
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant			3,900,000		3,900,000
Twenty Eleven Stock Incentive Plan [Member] | Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	10 years
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	4 years
Shares Previously Issued Under the 2001 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized								3,500,000
IDS Plan [Member] | Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period					10 years
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period					4 years
Two Thousand One Stock Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period					500,000
Outside of the 2011, 2001 or IDS Plans [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number			0		0
Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period					10 years
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized			$ 0.5		$ 0.5
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition					1 year 87 days
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Employee Subscription Rate			10.00%		10.00%
Share-based Compensation Arrangement by Share-based Payment Award, Purchase Price of Common Stock, Percent					85.00%
ESPP Maximum Annual Share Replenishment					675,000
ESPP Maximum Annual Share Replenishment Percentage of Prior Year Outstanding Company Common Stock					2.00%
Stock Issued During Period, Shares, Employee Stock Purchase Plans			99,550	88,543	199,827	173,001
Employee Stock Purchase Plan Weighted Average Purchase Price of Shares Purchased			$ 9.53	$ 8.81	$ 9.33	$ 9
Number Of ESPP Shares Available For Future Issuance			4,300,000		4,300,000

Note 5 - Stockholders' Equity -

Note 5 - Stockholders' Equity - Allocation of Recognized Period Costs (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Allocation of recognized period costs	$ 2,949	$ 2,977	$ 8,737	$ 7,935
Cost of Sales [Member]
Allocation of recognized period costs	1,184	1,191	3,445	3,232
Research and Development Expense [Member]
Allocation of recognized period costs	877	894	2,558	2,251
Selling, General and Administrative Expenses [Member]
Allocation of recognized period costs	$ 888	$ 892	$ 2,734	$ 2,452

Note 5 - Stockholders' Equity34

Note 5 - Stockholders' Equity - Stock Options, Valuation Assumptions (Details) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Weighted average fair value (in dollars per share)			$ 6.14
Employee Stock Purchase Plan [Member]
Expected life (Year)			1 year 91 days	1 year 91 days
Volatility			40.63%	44.00%
Risk-free interest rate			1.25%	0.50%
Expected dividend
Weighted average fair value (in dollars per share)			$ 5.22	$ 3.70
Stock Plans [Member]
Expected life (Year)	4 years 149 days	4 years 153 days	4 years 149 days	4 years 153 days
Volatility	41.49%	42.97%	41.53%	43.82%
Risk-free interest rate	1.65%	1.10%	1.69%	1.20%
Expected dividend	0.00%	0.00%	0.00%	0.00%
Weighted average fair value (in dollars per share)	$ 5.78	$ 5.52	$ 6.14	$ 4.82

Note 5 - Stockholders' Equity35

Note 5 - Stockholders' Equity - Stock Options Activity (Details) $ / shares in Units, shares in Thousands	9 Months Ended
	Sep. 30, 2017USD ($)$ / sharesshares
Outstanding, January 1, 2017 (in shares) | shares	1,364
Outstanding, January 1, 2017 (in dollars per share) | $ / shares	$ 8
Granted (in shares) | shares	100
Granted (in dollars per share) | $ / shares	$ 16.97
Exercised (in shares) | shares	(366)
Exercised (in dollars per share) | $ / shares	$ 6.43
Canceled (in shares) | shares	(16)
Canceled (in dollars per share) | $ / shares	$ 15.63
Expired (in shares) | shares	(1)
Expired (in dollars per share) | $ / shares	$ 18.10
Outstanding, September 30, 2017 (in shares) | shares	1,081
Outstanding, September 30, 2017 (in dollars per share) | $ / shares	$ 9.23
Outstanding, September 30, 2017 (Year)	4 years 266 days
Outstanding, September 30, 2017 | $	$ 7,133
Vested and expected to vest, September 30, 2017 (in shares) | shares	1,065
Vested and expected to vest, September 30, 2017 (in dollars per share) | $ / shares	$ 9.13
Vested and expected to vest, September 30, 2017 (Year)	4 years 240 days
Vested and expected to vest, September 30, 2017 | $	$ 7,124
Exercisable, September 30, 2017 (in shares) | shares	893
Exercisable, September 30, 2017 (in dollars per share) | $ / shares	$ 7.82
Exercisable, September 30, 2017 (Year)	3 years 299 days
Exercisable, September 30, 2017 | $	$ 6,966

Note 5 - Stockholders' Equity36

Note 5 - Stockholders' Equity - Stock Options Activity (Details) (Parentheticals)	9 Months Ended
	Sep. 30, 2017$ / shares
Weighted average fair value (in dollars per share)	$ 6.14

Note 5 - Stockholders' Equity37

Note 5 - Stockholders' Equity - Nonvested Restricted Stock Units Activity (Details) - Restricted Stock Units (RSUs) [Member] shares in Thousands	9 Months Ended
	Sep. 30, 2017$ / sharesshares
Nonvested, Balance (in shares) | shares	1,542
Nonvested, Balance (in dollars per share) | $ / shares	$ 15.50
Granted (in shares) | shares	793
Granted (in dollars per share) | $ / shares	$ 16.53
Vested (in shares) | shares	(431)
Vested (in dollars per share) | $ / shares	$ 15.78
Forfeited (in shares) | shares	(99)
Forfeited (in dollars per share) | $ / shares	$ 15.93
Nonvested, Balance (in shares) | shares	1,805
Nonvested, Balance (in dollars per share) | $ / shares	$ 15.86

Note 6 - Income Taxes (Details

Note 6 - Income Taxes (Details Textual) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Increase (Decrease) in Income Taxes			$ (5,900)
Income Tax Expense (Benefit)	$ (270)	$ 1,051	$ (2,246)	$ 3,655
Effective Income Tax Rate Reconciliation, Percent			236.70%	37.30%
Unrecognized Tax Benefits	12,700		$ 12,700		$ 11,900
Unrecognized Tax Benefits that Would Impact Effective Tax Rate	7,600		7,600		7,200
Unrecognized Tax Benefits In Long Term Liabilities	2,900		2,900
Unrecognized Tax Benefits In Deferred Tax Assets	9,800		9,800
Unrecognized Tax Benefits In Deferred Tax Asset Subject To Full Valuation Allowance	5,100		5,100
Deferred Tax Assets, Valuation Allowance	$ 7,500		7,500		$ 6,800
Accounting Standards Update 2016-09 [Member]
Excess Tax Benefit from Share-based Compensation			$ 1,600

Note 7 - Net Income Per Share -

Note 7 - Net Income Per Share - Calculation of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Net income	$ 590	$ 1,984	$ 1,297	$ 6,178
Basic weighted average common shares outstanding (in shares)	32,078	31,413	32,060	31,286
Dilutive effect of equity incentive plans (in shares)	891	1,165	1,257	858
Diluted weighted average common shares outstanding (in shares)	32,969	32,578	33,317	32,144
Basic (in dollars per share)	$ 0.02	$ 0.06	$ 0.04	$ 0.20
Diluted (in dollars per share)	$ 0.02	$ 0.06	$ 0.04	$ 0.19

Note 7 - Net Income Per Share40

Note 7 - Net Income Per Share - Antidilutive Securities (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Antidilutive securities (in shares)	294	370	163	739
Employee Stock Option [Member]
Antidilutive securities (in shares)	211	119	109	188
Restricted Stock Units (RSUs) [Member]
Antidilutive securities (in shares)	15	226	12	389
Employee Stock Purchase Plan [Member]
Antidilutive securities (in shares)	68	25	42	162

Note 8 - Customer and Geograp41

Note 8 - Customer and Geographic Information (Details Textual)	9 Months Ended
	Sep. 30, 2017
Number of Operating Segments	1
Number of Reportable Segments	1

Note 8 - Customer and Geograp42

Note 8 - Customer and Geographic Information - Revenue Percentage by Major Customers (Details) - Customer Concentration Risk [Member] - Sales Revenue, Net [Member]	3 Months Ended			9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016		Sep. 30, 2017	Sep. 30, 2016
Customer A [Member]
Receivables percentage by major customer	38.00%	38.00%		41.00%	42.00%
Customer B [Member]
Receivables percentage by major customer		12.00%	[1]		12.00%	[1]
[1]	represents less than 10%

Note 8 - Customer and Geograp43

Note 8 - Customer and Geographic Information - Receivables Percentage by Major Customers (Details) - Customer Concentration Risk [Member] - Accounts Receivable [Member]	9 Months Ended	12 Months Ended
	Sep. 30, 2017	Dec. 31, 2016
Customer A [Member]
Receivables percentage by major customer	44.00%	42.00%
Customer C [Member]
Receivables percentage by major customer	15.00%	13.00%

Note 8 - Customer and Geograp44

Note 8 - Customer and Geographic Information - Revenues by Geographic Area (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Revenues	$ 26,517	$ 27,259	$ 75,094	$ 79,028
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member]
Revenues	$ 26,517	$ 27,259	$ 75,094	$ 79,028
Percentage of Revenues	100.00%	100.00%	100.00%	100.00%
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | UNITED STATES
Revenues	$ 9,750	$ 8,680	$ 30,610	$ 30,320
Percentage of Revenues	37.00%	32.00%	41.00%	38.00%
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | CHINA
Revenues	$ 6,452	$ 2,907	$ 12,891	$ 5,506
Percentage of Revenues	24.00%	11.00%	17.00%	7.00%
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | GERMANY
Revenues	$ 2,729	$ 4,896	$ 6,831	$ 11,924
Percentage of Revenues	10.00%	18.00%	9.00%	15.00%
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | TAIWAN, PROVINCE OF CHINA
Revenues	$ 2,414	$ 4,079	$ 9,894	$ 11,988
Percentage of Revenues	9.00%	15.00%	13.00%	15.00%
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | South Korea [Member]
Revenues	$ 1,539	$ 3,027
Percentage of Revenues	6.00%	11.00%
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | KOREA, REPUBLIC OF
Revenues			$ 5,159	$ 8,523
Percentage of Revenues			7.00%	11.00%
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | Rest of the World [Member]
Revenues	$ 3,633	$ 3,670	$ 9,709	$ 10,767
Percentage of Revenues	14.00%	13.00%	13.00%	14.00%

Note 8 - Customer and Geograp45

Note 8 - Customer and Geographic Information - Long-lived Assets by Geographic Area (Details) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Long-lived assets	$ 23,604	$ 19,341
UNITED STATES
Long-lived assets	23,117	18,818
Rest of the World [Member]
Long-lived assets	$ 487	$ 523

Note 9 - Fair Value Measureme46

Note 9 - Fair Value Measurements (Details Textual) - Foreign Exchange Contract [Member] - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Derivative Asset, Notional Amount	$ 8,000,000		$ 8,000,000		$ 6,900,000
Other Current Liabilities [Member]
Derivative Liability, Current	10,000		10,000		$ 15,000
Other Nonoperating Income (Expense) [Member]
Derivative, Gain (Loss) on Derivative, Net	$ 200,000	$ 37,000	$ 700,000	$ 45,000

Note 9 - Fair Value Measureme47

Note 9 - Fair Value Measurements - Fair Value, Assets Measured on a Recurring Basis (Details) - Money Market Funds [Member] - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Money market mutual funds	$ 26,577	$ 26,456
Fair Value, Inputs, Level 1 [Member]
Money market mutual funds	26,577	26,456
Fair Value, Inputs, Level 2 [Member]
Money market mutual funds
Fair Value, Inputs, Level 3 [Member]
Money market mutual funds

Note 10 - Commitments and Con48

Note 10 - Commitments and Contingencies (Details Textual) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Operating Leases, Rent Expense, Net	$ 600	$ 600	$ 1,600	$ 1,700
Purchase Obligation, Due in Next Twelve Months	8,300		8,300
Loss Contingency Accrual	$ 0		$ 0

Note 10 - Commitments and Con49

Note 10 - Commitments and Contingencies - Future Minimum Lease Payments Under Noncancelable Operating Leases (Details) $ in Thousands	Sep. 30, 2017USD ($)
2017 (remaining three months)	$ 544
2,018	1,757
2,019	532
2,020	444
2,021	360
2022 and thereafter	126
Total future minimum lease payments	$ 3,763