Applied Optoelectronics (AAOI) 10-K 28 Feb 18 2017 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2017	Feb. 23, 2018	Jun. 30, 2017
Document And Entity Information
Entity Registrant Name	APPLIED OPTOELECTRONICS, INC.
Entity Central Index Key	1,158,114
Document Type	10-K
Document Period End Date	Dec. 31, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 1,121,657,372
Entity Common Stock, Shares Outstanding		19,500,728
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2,017

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Current Assets
Cash and cash equivalents	$ 82,936	$ 50,224
Restricted cash	1,012	1,732
Short-term investments	36	44
Accounts receivable - trade, net of allowance of $33 and $31, respectively	59,850	49,766
Inventories	75,768	51,817
Prepaid income tax	1,394
Prepaid expenses and other current assets	8,701	3,969
Total current assets	229,697	157,552
Cash restricted for construction in progress		8
Property, plant and equipment, net	197,943	144,098
Land use rights, net	804	778
Intangible assets, net	4,007	3,993
Deferred income tax assets	12,801	11,421
Other assets, net	7,732	4,468
TOTAL ASSETS	452,984	322,318
Current liabilities
Current portion of notes payable and long-term debt	559	7,865
Accounts payable	43,624	36,375
Bank acceptance payable		307
Accrued income taxes	7,422	974
Accrued liabilities	19,103	14,452
Total current liabilities	70,708	59,973
Notes payable and long-term debt, less current portion	49,000	34,961
TOTAL LIABILITIES	119,708	94,934
Stockholders' equity:
Preferred Stock; 5,000 shares authorized at $0.001 par value; no shares issued and outstanding at December 31, 2017 and December 31, 2016, respectively
Common Stock; 45,000 shares authorized at $0.001 par value; 19,451 and 18,400 shares issued and outstanding at December 31, 2017 and December 31, 2016, respectively	19	18
Additional Paid in Capital	285,376	265,264
Accumulated other comprehensive gain (loss)	9,743	(885)
Retained earnings (accumulated deficit)	38,138	(37,013)
TOTAL STOCKHOLDERS' EQUITY	333,276	227,384
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 452,984	$ 322,318

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 33	$ 31
Preferred Stock par value	$ 0.001	$ 0.001
Preferred Stock shares authorized	5,000,000	5,000,000
Preferred Stock shares issued	0	0
Preferred Stock shares outstanding	0	0
Common stock par value	$ 0.001	$ 0.001
Common stock shares authorized	45,000,000	45,000,000
Common stock shares issued	19,451,000	18,400,000
Common stock shares outstanding	19,451,000	18,400,000

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Statement [Abstract]
Revenue, net	$ 382,329	$ 260,713	$ 189,903
Cost of goods sold	216,049	173,759	129,450
Gross profit	166,280	86,954	60,453
Operating expenses
Research and development	35,365	31,780	20,852
Sales and marketing	8,702	6,627	6,381
General and administrative	35,262	25,527	19,771
Total operating expenses	79,329	63,934	47,004
Income from operations	86,951	23,020	13,449
Other income (expense)
Interest income	221	247	328
Interest expense	(858)	(1,717)	(1,018)
Other income (expense), net	(1,788)	(547)	(1,591)
Total other income (expense)	(2,425)	(2,017)	(2,281)
Income before income taxes	84,526	21,003	11,168
Income tax (expense) benefit	(10,575)	10,231	(375)
Net income	$ 73,951	$ 31,234	$ 10,793
Net income per share basic	$ 3.87	$ 1.82	$ 0.69
Net income per share diluted	$ 3.67	$ 1.76	$ 0.65
Weighted average shares used to compute net income per share: basic	19,097,355	17,201,731	15,626,753
Weighted average shares used to compute net income per share: Diluted	20,139,105	17,712,928	16,532,850

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Statement of Comprehensive Income [Abstract]
Net income	$ 73,951	$ 31,234	$ 10,793
Gain on foreign currency translation adjustment	10,628	(1,177)	(1,633)
Comprehensive income	$ 84,579	$ 30,057	$ 9,160

CONSOLIDATED STATEMENTS OF STOC

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) shares in Thousands, $ in Thousands	Common stock	Additional paid-in capital	Accumulated other comprehensive gain (loss)	Retained earnings/(Accumulated deficit	Total
Beginning balance, shares at Dec. 31, 2014	14,824
Beginning balance, value at Dec. 31, 2014	$ 15	$ 192,112	$ 1,925	$ (79,040)	$ 115,012
Public offering of common stock, net, in shares	1,857
Public offering of common	$ 2	38,646			38,648
Issuance of shares under equity plans, in shares	77
Stock options exercised, net of shares withheld for employee tax, in shares	81
Stock options exercised, net of shares withheld for employee tax, value		452			452
Share based compensation		2,120			2,120
Loss on foreign currency translation adjustment			(1,633)		(1,633)
Other		6			6
Net income				10,793	10,793
Ending balance, shares at Dec. 31, 2015	16,839
Ending balance, value at Dec. 31, 2015	$ 17	233,336	292	(68,247)	165,398
Public offering of common stock, net, in shares	1,126
Public offering of common	$ 1	27,236			27,237
Issuance of shares under equity plans, in shares	276
Stock options exercised, net of shares withheld for employee tax, in shares	159
Stock options exercised, net of shares withheld for employee tax, value		859			859
Share based compensation		3,833			3,833
Loss on foreign currency translation adjustment			(1,177)		(1,177)
Net income				31,234	31,234
Ending balance, shares at Dec. 31, 2016	18,400
Ending balance, value at Dec. 31, 2016	$ 18	265,264	(885)	(37,013)	227,384
Public offering of common stock, net, in shares	459
Public offering of common	$ 1	21,571			21,572
Stock options exercised, net of shares withheld for employee tax, in shares	418
Stock options exercised, net of shares withheld for employee tax, value		(6,630)			(6,630)
Issuance of restricted stock, net of shares withheld for employee tax, in shares	174
Issuance of restricted stock, net of shares withheld for employee tax, value		(2,631)			(2,631)
Share based compensation		7,795			7,795
Cumulative effect of previously unrecognized tax benefits				1,207	1,207
Loss on foreign currency translation adjustment			10,628		10,628
Other		7		(7)
Net income				73,951	73,951
Ending balance, shares at Dec. 31, 2017	19,451
Ending balance, value at Dec. 31, 2017	$ 19	$ 285,376	$ 9,743	$ 38,138	$ 333,276

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Operating activities:
Net income	$ 73,951	$ 31,234	$ 10,793
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Lower of cost or market reserve adjustment to inventory	1,866	3,707	2,832
Depreciation and amortization	20,381	14,188	9,424
Deferred income taxes, net	(114)	(11,426)
Loss on disposal of assets	97	126	78
Share-based compensation	7,795	3,833	2,120
Unrealized foreign exchange loss (gain)	330	(937)	2,462
Changes in operating assets and liabilities:
Accounts receivable, trade	(10,080)	(11,147)	(7,531)
Notes receivable			977
Prepaid tax	(1,386)
Inventories	(21,876)	10,207	(37,502)
Other current assets	(4,185)	4,119	(2,624)
Accounts payable	7,249	9,105	(1,258)
Accrued income taxes	6,204	988	220
Accrued liabilities	4,052	3,107	4,797
Net cash provided by (used in) operating activities	84,284	57,104	(15,212)
Investing activities:
Purchase of short-term investments			(175)
Maturities of short-term investments	8	7,752
Purchase of property, plant and equipment	(66,968)	(49,442)	(57,080)
Proceeds from disposal of equipment	171	14	351
Deposits and prepaid for equipment	(2,871)	688	(4,238)
Purchase of intangible assets	(499)	(547)	(478)
Net cash used in investing activities	(70,159)	(41,535)	(61,620)
Financing activities:
Proceeds from issuance notes payable and long-term debt		28,858	16,944
Principal payments of long-term debt and notes payable	(42,758)	(5,855)	(2,413)
Proceeds from line of credit borrowings	88,003	117,172	144,386
Repayments of line of credit borrowings	(39,003)	(163,068)	(121,386)
Proceeds from bank acceptance payable		5,850	8,257
Repayments of bank acceptance payable	(309)	(8,398)	(6,361)
Repayments of notes payable		(1,000)	(1,000)
Exercise of stock options	1,460	859	452
Payments of tax withholding on behalf of employees related to share-based compensation	(10,721)
Proceeds from common stock offering, net	21,572	27,237	38,648
Other			6
Net cash provided by financing activities	18,244	1,655	77,533
Effect of exchange rate changes on cash	(385)	1,947	(592)
Net increase in cash, cash equivalents and restricted cash	31,984	19,171	109
Cash, cash equivalents and restricted cash, at beginning of period	51,964	32,793	32,684
Cash, cash equivalents and restricted cash, at end of period	83,948	51,964	32,793
Cash paid for:
Interest	872	1,689	1,070
Income taxes	$ 5,835	$ (12)	$ 650

A. ORGANIZATION AND OPERATIONS

A. ORGANIZATION AND OPERATIONS	12 Months Ended
	Dec. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND OPERATIONS	NOTE A—ORGANIZATION AND OPERATIONS Applied Optoelectronics, Inc. (“AOI” or the “Company”) was incorporated in the State of Texas on February 28, 1997. In March 2013, the Company converted into a Delaware corporation. The Company is a leading, vertically integrated provider of fiber-optic networking products, primarily for four networking end-markets: internet data center, cable television, telecommunications and fiber-to-the-home. The Company designs and manufactures a wide range of optical communications products at varying levels of integration, from components, subassemblies and modules to complete turn-key equipment. The Company has manufacturing and research and development facilities located in the U.S., Taiwan and China. At its corporate headquarters and manufacturing facilities in Sugar Land, Texas, the Company primarily manufactures lasers and laser components and performs research and development activities for laser component and optical module products. The Company operates in Taipei, Taiwan and Ningbo, China through its wholly-owned subsidiary Prime World International Holdings, Ltd. (“Prime World”, incorporated in the British Virgin Islands). Prime World is the parent of Global Technology, Inc. (“Global”, incorporated in the People’s Republic of China). Through Global, the Company primarily manufactures certain of its data center transceiver products, including subassemblies and transceivers, as well as Cable TV Broadband (“CATV”) systems and equipment, and performs research and development activities for the CATV products. Prime World also operates a branch in Taiwan, which primarily manufactures transceivers. The Company also has a research and development center in Duluth, Georgia.

B. SUMMARY OF SIGNIFICANT ACCOU

B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	12 Months Ended
	Dec. 31, 2017
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE B—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 1. Basis of Presentation The consolidated financial statements include the accounts of the Company and all of its wholly-owned subsidiaries and are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). All intercompany balances and transactions have been eliminated in consolidation. 2. Reclassifications Certain amounts in the prior year’s financial statements have been reclassified to conform to the current year presentation. This reclassification includes the presentation of revenue in Note O – Segment and Geographic Revenue. In 2015, revenue by geographic region was reclassified between the United States, Taiwan and China to conform to the current year presentation by classifying consigned inventory revenue based on manufacturing location rather than consignment sale location. 3. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ from those estimates in the consolidated financial statements and accompanying notes. Significant estimates and assumptions that impact these financial statements relate to, among other things, allowance for doubtful accounts, inventory reserve, product warranty costs, share-based compensation expense, estimated useful lives of property and equipment, and taxes. 4. Foreign Currency Translation The functional currency for the Company’s foreign operations is the local currency. The assets and liabilities of these operations are translated at the rate of exchange in effect on the balance sheet date and sales and expenses are translated at monthly average rates. The resulting gains or losses from translation are included in a separate component of other comprehensive income. There is no tax effect on the foreign currency translation because it is management’s intent to reinvest the undistributed earnings of its foreign subsidiaries indefinitely. Transaction gains and losses resulting from re-measuring monetary asset and liability accounts that are denominated in a currency other than a subsidiary’s functional currency are included in net foreign exchange gain and loss and are included in net income except for intercompany long-term investment nature. The after-tax translation gain or losses from long-term investment nature of intercompany balances are treated as translation adjustments and included in comprehensive income. 5. Fair Value The carrying value of cash, cash equivalents and short-term investments, accounts receivable, accounts payable, and note receivable approximate their historical fair values due to their short-term maturities. The carrying value of the debt approximates its fair value due to the short-term nature of the debt since it renews frequently at current interest rates. Management believes that the interest rates in effect at each year end represent the current market rates for similar borrowings. The fair value measurement standard defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard characterizes inputs used in determining fair value according to a hierarchy that prioritized inputs based on the degree to which they are observable. The three levels of the fair value hierarchy are as follows: Level 1—Inputs represent quoted prices in active markets for identical assets or liabilities. Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3—Inputs that are not observable from objective sources, such as management’s internally developed assumptions used in pricing an asset or liability. Assets and liabilities that are required to be fair valued on a recurring basis include money market funds, marketable securities, equity instruments and contingent consideration. Money market funds are valued with Level 1 inputs, using quoted market prices, and are included in cash and cash equivalents on the Company’s consolidated balance sheets. 6. Cash and Cash Equivalents The Company considers all highly liquid securities with an original maturity of ninety days or less from the date of purchase to be cash equivalents. Cash in foreign accounts was approximately $21.0 million and $10.7 million at December 31, 2017 and 2016, respectively. The Company maintains cash and cash equivalents at U.S. financial institutions for which the combined account balances in individual institutions may exceed Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. As of December 31, 2017, approximately $58.8 million of U.S. deposits were not covered by FDIC insurance. The Company has not experienced any losses and believes it is not exposed to any significant risk with such accounts. 7. Restricted Cash/Compensating Balances The Company is required to maintain a compensation deposit equal to 30% of its bank acceptance notes to vendors and a standby letter of credit issued for guaranty of its Taiwan credit facility with a China bank. The Company’s Taiwan subsidiary also uses time deposits for customs guarantees as well as compensation balances with a Taiwan bank for its credit facility. As of December 31, 2017 and 2016, the amount of restricted cash was $1.0 million and $1.7 million, respectively. 8. Accounts Receivable/Allowance for Doubtful Accounts The Company carries its accounts receivable at the net amount that it estimates to be collectible. An allowance for uncollectable accounts is maintained through a charge against operations. The allowance is determined by management review of outstanding amounts per customer, historical payments and the aging of accounts. 9. Concentration of Credit Risk and Significant Customers Financial instruments which potentially subject the Company to concentrations of credit risk include cash, cash equivalents and accounts receivable. The Company places all cash and cash equivalents with high-credit quality financial institutions. The Company performs ongoing credit valuations of its customers’ financial condition whenever deemed necessary and generally does not require deposits or collateral to support customer receivables. The historical amount of losses on uncollectible accounts has been within the Company’s estimates. The Company generates much of its revenue from a limited number of customers. In 2017, 2016 and 2015, its top five customers represented 86.1%, 87.8% and 81.8% of its revenue, respectively. In 2017, Amazon, Facebook and Microsoft represented 35.4%, 28.6% and 13.8% of its revenue, respectively. In 2016, Amazon, Microsoft and Arris represented 54.6%, 18.3% and 5.8% of its revenue, respectively. In 2015, Amazon, Microsoft and Cisco represented 52.5%, 11.6% and 10.4% of its revenue, respectively. The five largest receivable balances for customers represented an aggregate of 82.6%, and 88.3% of total accounts receivable at December 31, 2017 and 2016, respectively. As of December 31, 2017, Amazon and Microsoft represented 36.1% and 19.5% of total accounts receivable, respectively. As of December 31, 2016, Amazon and Arris represented 62.1% and 10.6% of total accounts receivable, respectively. No other customer represented greater than ten percent of revenue in 2017, 2016 or 2015 or greater than ten percent of total accounts receivable at December 31, 2017 or 2016. 10. Inventories Inventories are stated at the lower of cost (average-cost method) or market. Work in process and finished goods includes materials, labor and allocated overhead. The Company assesses the valuation of its inventory on a periodic basis and provides write-offs for the value of estimated excess and obsolete inventory based on estimates of future demand. 11. Property, Plant and Equipment Property, plant and equipment are stated at cost, net of accumulated depreciation and amortization. The Company calculates depreciation using the straight-line method over the following estimated useful lives: Useful lives Buildings 20 - 42 years Land improvements 10 years Machinery and equipment 2 - 20 years Furniture and fixtures 3 - 7 years Computer equipment and software 3 - 10 years Leasehold improvements The shorter of the life of the applicable lease or the useful life of the improvement Transportation equipment 5 years Major improvements are capitalized and expenditures for maintenance and repairs are expensed as incurred. Construction in progress represents property, plant and equipment under construction or being installed. Costs include original cost, installation, construction and other direct costs which include interest on borrowings used to finance the asset. Construction in progress is transferred to the appropriate fixed asset account and depreciation commences when the asset has been substantially completed and placed in service. Land use rights allow the Company rights for 50 years to certain land in Ningbo, China on which the Company built a facility that included office space, manufacturing operations and employee dormitories. The land use rights are recorded at cost and are amortized on the straight-line basis over the useful life of the related contract. The land use rights expire on October 7, 2054 and December 28, 2067. 12. Intangible Assets Intangible assets consist of intellectual property that is stated at cost less accumulated amortization. As of December 31, 2017, the Company had 241 total patents issued. The costs incurred to obtain such patents have been capitalized and are being amortized over an estimated life of 20 years. The Company periodically evaluates its intangible assets to determine whether events or changes in circumstances indicate that a patent or trademark may not be applicable to the Company’s current products or is no longer in use. If such a determination is made, the intangible asset is impaired and the remaining value of the patent or trademark will be expensed at that time. 13. Impairment of Long-Lived Assets The Company accounts for impairment of long-lived assets in accordance with Accounting Standards Codification (“ASC”) 360, Property, Plant and Equipment , (“ASC 360”). Long-lived assets consist primarily of property, plant and equipment. In accordance with ASC 360, the Company periodically evaluates long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When triggering event indicators are present, the Company obtains appraisals on an asset by asset basis, and will recognize an impairment loss when the sum of the appraised values is less than the carrying amounts of such assets. The appraised values, based on reasonable and supportable assumptions and projections, require subjective judgments. Depending on the assumptions and estimates used, the appraised values projected in the evaluation of long-lived assets can vary within a range of outcomes. The appraisals consider the likelihood of possible outcomes in determining the best estimate for the value of the assets. The measurement for such an impairment loss is then based on the fair value of the asset as determined by the appraisals. 14. Comprehensive Income (Loss) ASC 220, Comprehensive Income , (“ASC 220”) establishes rules for reporting and display of comprehensive income and its components. ASC 220 requires that unrealized gains and losses on the Company’s foreign currency translation adjustments be included in comprehensive income. 15. Share-based Compensation The Company accounts for share-based compensation in accordance with the provisions of ASC 718, Compensation—Stock Compensation . Share-based compensation expense is recognized based on the estimated grant date fair value in order to recognize compensation cost for those shares expected to vest. Compensation cost is recognized on a straight-line basis over the vesting period of the options and adjusted as forfeitures occur. 16. Revenue Recognition The Company derives revenue from the manufacture and sale of fiber optic networking products. Revenue recognition follows the criteria of ASC 605, Revenue Recognition . Specifically, the Company recognizes revenue when persuasive evidence exists of an arrangement with a customer, usually in the form of a customer purchase order; performance obligations have been satisfied; title and risk of loss have transferred to the customer; the price is fixed or determinable; and collectability is reasonably assured. 17. Product Warranty The Company generally offers a one-year limited warranty for its products but it can extend for longer periods of three to five years for certain products sold to certain customers. The Company estimates the costs that may be incurred under its basic limited warranty and records a liability for the amount of such costs at the time when product defective occurs. Factors that affect the Company’s warranty liability include the historical and anticipated rates of warranty claims and cost to repair. While the Company believes that its warranty accrual is adequate, the actual warranty costs may exceed the accrual, cost of sales will increase in the future. As of December 31, 2017 and 2016, the amount of accrued warranty was $1.1 million and $0.7 million, respectively. 18. Advertising Costs Advertising costs are charged to operations as incurred and amounted to approximately $0.3 million, $0.2 million and $0.1 million for the years ended December 31, 2017, 2016 and 2015, respectively. 19. Research and Development Research and development costs are charged to operations as incurred. The Company receives reimbursement for certain development costs, which are capitalized when incurred, up to the reimbursable amount. 20. Income Taxes The Company accounts for income taxes in accordance with the provisions of ASC 740, Income Taxes . The liability method is used to account for deferred income taxes. Under the liability method, deferred tax assets and liabilities are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The ability to realize deferred tax assets is evaluated annually and a valuation allowance is provided if it is unlikely that the deferred tax assets will not give rise to future benefits in the Company’s tax returns. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, it recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. Accrued interest and penalties are included on the related tax liability line in the consolidated balance sheet. 21. Recent Accounting Pronouncements Recent Accounting Pronouncements Adopted in 2017 I n March 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-09, Improvements to Employee Share-Based Payment Accounting, to simplify several aspects of accounting for share-based payment transactions, including the following areas: accounting for excess tax benefits and tax deficiencies; classifying excess tax benefits on the statement of cash flows; accounting for forfeitures; classifying awards that permit share repurchases to satisfy statutory tax withholding requirements; classifying tax payments on behalf of employees on the statement of cash flows; and, for nonpublic entities only, determining the expected term and electing the intrinsic value measurement alternative for stock option awards. The guidance is effective for public business entities in fiscal years beginning after December 15, 2016, and in the interim periods within those fiscal years. The guidance requires a mix of prospective, modified retrospective and retrospective transition. The Company adopted the provisions of ASU 2016-09 as of January 1, 2017. The impact from adoption of the provisions related to forfeiture rates was reflected in the Company's condensed consolidated financial statements on a modified retrospective basis, resulting in an adjustment of $0.01 million to retained earnings. Provisions related to windfall tax benefits have been adopted prospectively resulting in an adjustment of $1.2 million to retained earnings. Provisions related to the statement of cash flows remain unchanged from prior periods. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows: Restricted Cash, providing guidance on the presentation of restricted cash or restricted cash equivalents in the statement of cash flows. ASU 2016-18 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The amendments in this ASU would be applied using a retrospective approach. The Company adopted the provisions of ASU 2016-18 as of July 1, 2017 with no material impact on the financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The ASU update addresses eight specific cash flow issues that currently result in diverse practices, including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination and separately identifiable cash flows and applicability of the predominance principle. ASU 2016-15 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The Company adopted the provisions of ASU 2016-15 as of July 1, 2017 with no material impact on the financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting, which clarifies when modification accounting should be applied for changes to terms or conditions of a share-based payment award. This ASU will be applied prospectively and is effective for fiscal years beginning after December 15, 2017, and interim periods within those years, with early adoption permitted. The Company adopted the provisions of ASU 2017-09 as of July 1, 2017 with no material impact on the financial statements. Recent Accounting Pronouncements Yet to be Adopted The FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The guidance is intended to improve the recognition and measurement of financial instruments. The ASU affects public and private companies, not-for-profit organizations, and employee benefit plans that hold financial assets or owe financial liabilities. The guidance is effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company plans to adopt this pronouncement in 2018 and does not expect any material impact on its financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). The amendments in ASU 2015-14 defer the effective date of ASU 2014-09 for all entities by one year. Public business entities should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. In applying the new guidance, the Company will: 1) identify the contracts with its customers, 2) identify the performance obligations in the contracts, 3) determine the transaction price, 4) allocate the transaction price to the performance obligations of the contract, and 5) recognize revenue when (or as) the Company satisfies a performance obligation. Since this guidance was issued, the Company has undertaken an accounting assessment phase focusing on developing a scoping plan and a review plan to determine the gaps between existing revenue recognition policies and the requirements of the new revenue guidance. This accounting assessment involved developing a training and education process for the Company personnel, performing sales contract walkthroughs to identify financial obligations, reviewing existing revenue streams and mapping contract features to revenue streams. As a result of this process, the Company has identified several areas where the new guidance may cause revenue recognition differences, possibly affecting either the timing or amount of revenue recognized in a given financial period. These areas include: · Revenue associated with customer rebates. In some cases, the Company offers cash rebates to certain customers when they purchase its products. Under the new guidance, any rebates expected to be offered to the customers must be deducted from the sales price of the goods in the same period in which the revenue for the products is recognized. In 2017, the aggregate amount of these rebates was immaterial and they are not expected to be material in 2018. · Timing of revenue recognition for certain engineering service contracts. From time to time, the Company undertakes engineering services for its customers. Typically, these services involve customizing or modifying products to better suit specific customer requirements. In some cases, customers pay all or a portion of the costs associated with these services. Under the new guidance, each of the services offered must be analyzed as a separate performance obligation and the timing of revenue recognition for some of these performance obligations may differ from the Company’s current practice. In 2017, the effect of these timing differences was not material, and material changes are not expected in 2018 as the Company adopts this new standard. · Revenue generated from shipping and handling activities. Depending on its agreement with its customers, the Company may in some cases provide shipping and handling services for products it sells. There is disparity in the agreements related to various customers, especially concerning the timing of transfer of control of the goods to the customer, and the relationship of this timing relative to the shipping and handling activities themselves. As a result of this disparity, in order to simplify its Accounting, the Company expects to utilize the practical expedient provided in ASC 606-10-25-18B, and treat all product shipping and handling activities as fulfillment activities, and therefore recognize the gross revenue associated with the contract, inclusive of any shipping and handling revenue. This is similar to the Company’s current practice and therefore the effect of the new guidance is immaterial. · Revenue generated from product warranty. Generally the Company offers a warranty on products it sells to its customers. The warranty period is typically one year from the date of purchase, but in some cases customers have negotiated longer warranty periods. The Company’s obligation under its warranty provision generally includes troubleshooting, repair and/or replacement of any goods that are found to have manufacturing defects. The Company has concluded that this represents an assurance-type warranty, as described in the guidance, and therefore does not constitute a separate performance obligation. Therefore, revenue associated with products, even when under warranty, will continue to be recognized on a gross basis. This is similar to the Company’s current practices and therefore the new guidance is not expected to result in a material change in revenue amount or timing. The Company plans to adopt the new standard using the modified-retrospective method on January 1, 2018, as required. On February 25, 2016, the FASB released ASU No. 2016-02, Leases, to complete its project to overhaul lease accounting. The ASU codifies ASC 842, Leases, which will replace the guidance in ASC 840. The guidance will require lessees to recognize most leases on the balance sheet for capital and operating leases. The guidance is effective for public business entities in fiscal years beginning after December 15, 2018. The Company is evaluating the impact of the accounting standard on its financial statements by reviewing the standard itself, as well as reviewing literature about the new standard produced by nationally-recognized accounting firms and other third parties. In January 2018, the FASB released guidance on the accounting for tax on the global intangible low-taxed income ("GILTI") provisions of the Tax Cuts and Jobs Act (the "Tax Act"). The GILTI provisions impose a tax on foreign income in excess of a deemed return on tangible assets of foreign corporations. The guidance indicates that either accounting for deferred taxes related to GILTI inclusions or to treat any taxes on GILTI inclusions as period cost are both acceptable methods subject to an accounting policy election. Effective the first quarter of 2018, the Company will elect to treat any potential GILTI inclusions as a period cost as it is not projecting any material impact from GILTI inclusions.

C. CASH, CASH EQUIVALENTS AND R

C. CASH, CASH EQUIVALENTS AND RESTRICTED CASH	12 Months Ended
	Dec. 31, 2017
Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents Abstract
CASH, CASH EQUIVALENTS AND RESTRICTED CASH	NOTE C—CASH, CASH EQUIVALENTS AND RESTRICTED CASH The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the statement of financial position that sum to the total of the same such amounts in the statement of cash flows (in thousands): As of December 31, 2017 2016 Cash and cash equivalents $ 82,936 $ 50,224 Restricted cash 1,012 1,740 Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 83,948 $ 51,964

D. EARNINGS PER SHARE

D. EARNINGS PER SHARE	12 Months Ended
	Dec. 31, 2017
Net income per share
EARNINGS PER SHARE	NOTE D—EARNINGS PER SHARE Basic net income per share has been computed using the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share has been computed using the weighted-average number of shares of common stock and dilutive potential common shares from options, restricted stock units and warrants outstanding during the period. In periods with net losses, normally dilutive shares become anti-dilutive. Therefore, basic and dilutive earnings per share are the same. The following table presents the computation of the basic and diluted net income per share for the periods indicated (in thousands, except per share amounts): Year ended December 31, 2017 2016 2015 Numerator: Net income $ 73,951 $ 31,234 $ 10,793 Denominator: Weighted average shares used to compute net income per share Basic 19,097 17,202 15,627 Effective of dilutive options and restricted stock units 1,042 511 906 Diluted 20,139 17,713 16,533 Net income per share Basic $ 3.87 $ 1.82 $ 0.69 Diluted $ 3.67 $ 1.76 $ 0.65

E. INVENTORIES

E. INVENTORIES	12 Months Ended
	Dec. 31, 2017
Inventory Disclosure [Abstract]
INVENTORIES	NOTE E—INVENTORIES At December 31, 2017 and 2016, inventories consisted of the following (in thousands): As of December 31, 2017 2016 Raw materials $ 26,648 $ 21,518 Work in process and sub-assemblies 31,060 24,334 Finished goods 18,060 5,965 $ 75,768 $ 51,817 For the years ended December 31, 2017, 2016 and 2015, the lower of cost or market reserve adjustment expensed for inventory was $1.9 million, $3.7 million and $2.8 million, respectively. For the years December 21, 2017, 2016 and 2015, the direct inventory write-offs related to scrap and damaged inventories were $6.8 million, $5.0 million and $1.0 million, respectively.

F. PROPERTY, PLANT AND EQUIPMEN

F. PROPERTY, PLANT AND EQUIPMENT	12 Months Ended
	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
PROPERTY, PLANT AND EQUIPMENT	NOTE F—PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following for the periods indicated (in thousands): As of December 31, 2017 2016 Land improvements $ 806 $ 792 Building and improvements 78,785 69,368 Machinery and equipment 168,993 108,724 Furniture and fixtures 4,663 4,227 Computer equipment and software 8,248 6,836 Transportation equipment 718 236 262,213 190,183 Less accumulated depreciation and amortization (70,194) (49,175) 192,019 141,008 Construction in progress 4,823 1,989 Land 1,101 1,101 Property, plant and equipment, net $ 197,943 $ 144,098 For the years ended December 31, 2017, 2016 and 2015, depreciation expense of property, plant and equipment was $19.9 million $13.7 million and $9.0 million, respectively.

G. INTANGIBLE ASSETS

G. INTANGIBLE ASSETS	12 Months Ended
	Dec. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
INTANGIBLE ASSETS	NOTE G—INTANGIBLE ASSETS Intangible assets consisted of the following for the periods indicated (in thousands): 2017 Gross Accumulated Intangible Amount amortization assets, net Patents $ 6,524 $ (2,519) $ 4,005 Trademarks 14 (12) 2 Total intangible assets $ 6,538 $ (2,531) $ 4,007 2016 Gross Accumulated Intangible Amount amortization assets, net Patents $ 5,987 $ (1,997) $ 3,990 Trademarks 14 (11) 3 Total intangible assets $ 6,001 $ (2,008) $ 3,993 For the years ended December 31, 2017, 2016 and 2015, amortization expense for intangible assets, included in general and administrative expenses on the income statement, was $0.5 million, $0.5 million and $0.4 million, respectively. The remaining weighted average amortization period for intangible assets is approximately 8.0 years. At December 31, 2017, future amortization expense for intangible assets is estimated to be (in thousands): 2018 $ 485 2019 485 2020 485 2021 486 2022 486 thereafter 1,580 $ 4,007

H. FAIR VALUE OF FINANCIAL INST

H. FAIR VALUE OF FINANCIAL INSTRUMENTS	12 Months Ended
	Dec. 31, 2017
Fair Value Disclosures [Abstract]
FAIR VALUE OF FINANCIAL INSTRUMENTS	NOTE H—FAIR VALUE OF FINANCIAL INSTRUMENTS The following table presents a summary of the Company’s financial instruments measured at fair value on a recurring basis as of December 31, 2017 (in thousands): Quoted prices Significant in active other markets for observable Significant identical remaining unobservable assets (Level 1) inputs (Level 2) inputs (Level 3) Total Assets: Cash and cash equivalents $ 82,936 $ — $ — $ 82,936 Restricted cash 1,012 — — 1,012 Short term investments 36 — — 36 Total assets $ 83,984 $ — $ — $ 83,984 Liabilities: Bank acceptance payable — $ — — $ — Total liabilities $ — $ — $ — $ — The following table presents a summary of the Company’s financial instruments measured at fair value on a recurring basis as of December 31, 2016 (in thousands): Quoted prices Significant in active other markets for observable Significant identical remaining unobservable assets (Level 1) inputs (Level 2) inputs (Level 3) Total Assets: Cash and cash equivalents $ 50,224 $ — $ — $ 50,224 Restricted cash 1,740 — — 1,740 Short term investments 44 — — 44 Total assets $ 52,008 $ — $ — $ 52,008 Liabilities: Bank acceptance payable — $ 307 — $ 307 Total liabilities $ — $ 307 $ — $ 307

I. NOTES PAYABLE AND LONG-TERM

I. NOTES PAYABLE AND LONG-TERM DEBT	12 Months Ended
	Dec. 31, 2017
Debt Disclosure [Abstract]
NOTES PAYABLE AND LONG-TERM DEBT	NOTE I—NOTES PAYABLE AND LONG-TERM DEBT Notes payable and long-term debt consisted of the following for the periods indicated (in thousands): December 31, 2017 2016 Revolving line of credit with a U.S. bank up to $50,000 with interest at LIBOR plus 1.5%, maturing September 28, 2020 $ 49,000 $ — Term loan with a U.S. bank with monthly payments of principal and interest at LIBOR plus 2% — 2,925 Term loan with a U.S. bank with monthly payments of principal and interest at LIBOR plus 2% — 9,500 Term loan with a U.S. bank with monthly payments of principal and interest at LIBOR plus 2% — 21,670 Notes payable to a finance company due in monthly installments with 4.5% interest, maturing May 27, 2018 559 2,919 Notes payable to a finance company due in monthly installments with 4% interest, maturing March 31, 2019 — 5,812 Total 49,559 42,826 Less current portion (559) (7,865) Non-current portion $ 49,000 $ 34,961 Bank Acceptance Notes Payable Bank acceptance notes issued to vendors with a zero percent interest rate $ — $ 307 The current portion of long-term debt is the amount payable within one year of the balance sheet date of December 31, 2017. Maturities of notes payable and long-term debt are as follows for the future years ending December 31 (in thousands): 2018 $ 559 2019 — 2020 49,000 2021 — 2022 — 2023 and thereafter — Total outstanding $ 49,559 On June 14, 2016, the Company executed a Change in Terms Agreement, Notice of Final Agreement and Modification of the Construction Loan Agreement (the “Modification Agreement”) in connection with the Construction Loan Agreement with East West Bank for up to $22.0 million dollars to finance the construction of the Company’s campus expansion plan in Sugar Land, Texas, originally dated January 26, 2015 (the “Construction Loan Agreement”). Upon signing the original Construction Loan Agreement, the Company deposited $11.0 million into a restricted bank account for owner’s contribution of construction costs. The Modification Agreement had a fifteen-month draw down period with monthly interest payments commencing on February 26, 2015 and ending on July 31, 2016. Thereafter, the entire outstanding principal balance was to be converted to a sixty-six month term loan with principal and interest payments due monthly amortized over three hundred months. The first principal and interest payment commenced on August 26, 2016, and continue the same day of each month thereafter. The final principal and interest payment would have been due on January 26, 2022 and would have included all unpaid principal and all accrued and unpaid interest. The Company was permitted to pay without penalty all or a portion of the amount owed earlier than due. Under the Construction Loan Agreement, the loan bore interest at an annual rate based on the one-month LIBOR Borrowing Rate plus 2.75%, and the interest rate was adjusted to LIBOR Borrowing Rate plus 2.0% under the Modification Agreement. On October 5, 2016, the Company executed a Change in Terms Agreement, Notice of Final Agreement and Second Modification to the Construction Loan Agreement (the “Second Modifications”) to the Construction Loan Agreement with East West Bank. The Second Modifications amended and restated in part the Company’s Promissory Note and Construction Loan Agreement, which was originally executed on January 26, 2015, and the Modification Agreement. The draw down period end date, under the Second Modifications, was amended from July 31, 2016 to September 30, 2016. And thereafter, the entire outstanding principal balance was to be converted to a sixty-four month term loan, amended from a sixty-six month term loan, with principal and interest payments due monthly amortized over three hundred months. The first principal and interest payment was due on October 26, 2016 and would have continued on the same day of each month thereafter. The final principal and interest payment was due on January 26, 2022 and would have included all unpaid principal and all accrued and unpaid interest. Except as expressly changed by the Second Modifications, the terms of the original obligation and the Modification Agreement remained unchanged. On September 28, 2017, the Company repaid the outstanding balance of $11.2 million and terminated the loan. On June 24, 2016, the Company entered into a First Amendment to the Credit Agreement with East West Bank and Comerica Bank (“First Amendment”), a second lien deed of trust, multiple security agreements and promissory notes evidencing two credit facilities and a term loan originally entered into on June 30, 2015. The First Amendment increased the Company’s revolving lines of credit from $25 million to $40 million, which would have matured on June 30, 2018, and retained a $10.0 million term loan which would have matured on June 30, 2020. The First Amendment also provided for an additional $10.0 million equipment term loan with a one year drawdown period commencing on April 1, 2016 and maturing five years from the closing date of the First Amendment. The interest rate on these loans was adjusted by the First Amendment from the LIBOR Borrowing Rate plus 2.75% or 3.0% to LIBOR Borrowing Rate plus 2.0%. On September 28, 2017, the Company terminated the Credit Agreement and all outstanding balances of the loans had been repaid. The Company also had a term loan with East West Bank of $5.0 million with monthly payments of principal and interest that matured on July 31, 2019. On February 27, 2017, the Company repaid the outstanding balance of $2.8 million and terminated the loan. On September 28, 2017, the Company entered into a Loan Agreement, a Promissory Note, an Addendum to the Promissory Note, a BB&T Security Agreement, a Trademark Security Agreement, and a Patent Security Agreement (together the “Credit Facility”) with Branch Banking and Trust Company (“BB&T”). The Credit Facility provides the Company with a three year, $50 million, revolving line of credit. Borrowings under the Credit Facility will be used for general corporate purposes. The Company will make monthly payments of accrued interest with the final monthly payment being for all principal and all accrued interest not yet paid. The Company’s obligations under the Credit Facility will be secured by the Company’s accounts receivable, inventory, intellectual property, and all business assets with the exception of real estate and equipment. Borrowings under the Credit Facility will bear interest at a rate equal to the one-month LIBOR plus 1.50%. The Credit Facility requires the Company to maintain certain financial covenants and also contains representations and warranties, and events of default applicable to the Company that are customary for agreements of this type. As of December 31, 2017, the Company was in compliance with all covenants under the Credit Facility. As of December 31, 2017, $49.0 million was outstanding under the Credit Facility. On May 27, 2015, the Company’s Taiwan branch entered into a Purchase and Sale Contract and a Finance Lease Agreement with Chailease Finance Co, Ltd. (“Chailease”) in connection with certain equipment, structured as a sale lease-back transaction. Pursuant to the Purchase and Sale contract, the Company’s Taiwan branch sold certain equipment to Chailease for a purchase price of 180,148,532 New Taiwan dollars, approximately $6.0 million, and simultaneously leased the equipment back from Chailease pursuant to the Finance Lease Agreement. The monthly lease payments range from 3,784,000 New Taiwan dollars, approximately $0.1 million, to 3,322,413 New Taiwan dollars, approximately $0.1 million, during the term of the Finance Lease Agreement, including an initial payment in an amount of 60,148,532 New Taiwan dollars, approximately $2.0 million. The Finance Lease Agreement has a three-year term, with monthly payments, maturing on May 27, 2018. The title to the equipment will be transferred to the Company’s Taiwan branch upon the expiration of the Finance Lease Agreement. As of December 31, 2017, $0.6 million was outstanding under this Finance Lease Agreement. On March 31, 2016, the Company’s Taiwan branch entered into a Purchase and Sale Contract and a Finance Lease Agreement with Chailease in connection with certain equipment, structured as a sale lease-back transaction. Pursuant to the Purchase and Sale Contract, the Company’s Taiwan branch sold certain equipment to Chailease for a purchase price of 312,927,180 New Taiwan dollars, approximately $10.1 million, and simultaneously leased the equipment back from Chailease pursuant to the Finance Lease Agreement. The Finance Lease Agreement had a three-year term with monthly lease payments range from 6,772,500 New Taiwan dollars, approximately $0.2 million, to 7,788,333 New Taiwan dollars, approximately $0.3 million, during the term of the Finance Lease Agreement, including an initial payment in an amount of 62,927,180 New Taiwan dollars, approximately $2.0 million. Based on the payments made under the Finance Lease Agreement, the annual interest rate was calculated to be 4.0%. The title to the equipment was to be transferred to the Company’s Taiwan branch upon the expiration of the Finance Lease Agreement. On October 6, 2017, the Company repaid the outstanding balance and terminated the loan and title to the equipment was transferred to its Taiwan branch. The Company’s Chinese subsidiary had credit facilities with China Construction Bank totaling $13.2 million, which could be drawn in U.S. currency, RMB currency, issuing bank acceptance notes to vendors with different interest rates or issuing standby letters of credit. The Company pledged the land use rights and buildings of its Chinese subsidiary as collateral for the credit facility. The Company’s Chinese subsidiary used $10.0 million of its credit facility to issue standby letters of credit as collateral for the Company’s Taiwan branch line of credit with China Construction Bank. On March 29, 2017, the Company repaid the outstanding balance and terminated the loan. As of December 31, 2017 and 2016, the Company had $1.0 million and $75.8 million of unused borrowing capacity, respectively. One-month LIBOR rates were 1.56425% and 0.77167% at December 31, 2017 and 2016, respectively. As of December 31, 2017 and 2016, there was $1.0 million and $1.7 million of restricted cash, investments or security deposit associated mainly with the loan facilities, respectively.

J. ACCRUED LIABILITIES

J. ACCRUED LIABILITIES	12 Months Ended
	Dec. 31, 2017
Payables and Accruals [Abstract]
ACCRUED LIABILITIES	NOTE J—ACCRUED LIABILITIES Accrued liabilities consisted of the following for the periods indicated (in thousands): As of December 31, 2017 2016 Accrued payroll $ 11,693 $ 9,231 Accrued rent 1,180 959 Accrued employee benefits 2,035 1,572 Accrued state and local taxes 951 607 Advance payments 441 252 Accrued product warranty 1,118 705 Accrued commission expenses 425 205 Accrued professional fees 181 163 Accrued other 1,079 758 $ 19,103 $ 14,452

K. OTHER INCOME AND EXPENSE

K. OTHER INCOME AND EXPENSE	12 Months Ended
	Dec. 31, 2017
Other income (expense)
OTHER INCOME AND EXPENSE	NOTE K—OTHER INCOME AND EXPENSE Other income and expense consisted of the following for the periods indicated (in thousands): Year ended December 31, 2017 2016 2015 Foreign exchange transaction loss $ (2,012) $ (617) $ (1,847) Government subsidy income 211 164 217 Other non-operating gain 110 32 117 Loss on disposal of assets (97) (126) (78) $ (1,788) $ (547) $ (1,591)

L. INCOME TAXES

L. INCOME TAXES	12 Months Ended
	Dec. 31, 2017
Income Tax Disclosure [Abstract]
INCOME TAXES	NOTE L—INCOME TAXES The sources of the Company’s income from operations before income taxes were as follows (in thousands): Year ended December 31, 2017 2016 2015 Domestic $ 17,497 $ 10,047 14,062 Foreign 67,029 10,956 (2,894) Total income before income taxes $ 84,526 $ 21,003 11,168 The provision for income tax expense (benefit) for the years ended December 31, was as follows (in thousands): Current: 2017 2016 2015 Federal $ — $ (15) $ 168 State (292) 256 207 Foreign 10,965 962 — Total $ 10,673 $ 1,203 $ 375 Deferred: Federal $ 2,015 $ (10,794) $ — State (1,669) (130) — Foreign (444) (510) — Total $ (98) $ (11,434) $ — Income tax (benefit) expense $ 10,575 $ (10,231) $ 375 Deferred income tax assets and liabilities result principally from net operating losses, different methods of recognizing depreciation, reserves for doubtful accounts and inventory, research & development credits and foreign tax credits. At December 31, the net deferred tax assets and liabilities are comprised of the following approximate amounts (in thousands): 2017 2016 NOL carryforward $ 7,739 $ 12,866 Inventory reserves 837 869 AMT credit 345 424 Unrealized gains and losses 92 (6) Share-based compensation 732 1,453 Foreign tax credit 2,018 — Research and development credits 4,626 — Other 573 255 Deferred tax assets 16,962 15,861 Less valuation allowance — (1,663) Deferred tax assets, net 16,962 14,198 Depreciation and amortization (4,161) (2,777) Deferred tax liabilities (4,161) (2,777) Deferred tax assets, net $ 12,801 $ 11,421 A valuation allowance was established to reduce a deferred tax asset to the amount that will more likely than not be realized. This reduction was primarily necessary due to the uncertainty of the Company’s ability to utilize all of the net operating loss carry forwards. The valuation allowance decreased by $1.7 million in 2017 and decreased by approximately $13.1 million in 2016. The decrease in 2017 was the result of the removal of its valuation allowance on China deferred income tax assets. The decrease in 2016 was primarily the result of the removal of its valuation allowance on U.S. and Taiwan deferred income tax assets. Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. In considering whether or not to continue to maintain the valuation allowance, the Company considers all available positive and negative evidence, including: historical profits and losses, forecasts of future profits or losses, and trends in the industries that the Company serves that may affect its ability to continue to generate profits. Objective evidence, such as historical losses, limits the ability to consider other subjective evidence, such as its projections for future growth. On the basis of this evaluation, as of December 31, 2017, management determined that there is sufficient positive evidence to conclude that it is more likely than not that additional deferred taxes of $1.7 million are realizable. It therefore reduced the valuation allowance accordingly. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are increased or if objective negative evidence is no longer present and additional weight is given to subjective evidence such as its projections for growth. The Company has a U.S. net operating loss carry forward of approximately $37.7 million, which, if unused, expires between 2025 and 2032. The Company has U.S. and state research and development tax credits of $4.6 million, which, if unused, expire between 2028 and 2037. In addition, the Company has foreign tax credits of $2.0 million, which, if unused, will expire in 2027. Utilization of U.S. net operating losses and tax credit carry forwards are subject to an annual limitation due to the ownership change limitations set forth in Internal Revenue Code Section 382. During 2015 and 2016, the Company updated its Section 382 analysis resulting in the recognition of additional utilizable net operating losses. Additional ownership changes could result in the expiration of the net operating loss and tax credit carryforwards before utilization. On January 1, 2017, the Company adopted ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting." The new standard requires that the tax impact related to the difference between share-based compensation for book and tax purposes be recognized as income tax benefit or expense in its condensed consolidated statement of operations in the reporting period in which such awards vest. The standard also required a modified retrospective adoption for previously unrecognized excess tax benefits. Accordingly, the Company recognized a deferred tax asset of $1.2 million and a corresponding credit to retained earnings in conjunction with the adoption. The effects of adopting the other provisions of ASU 2016-09 were not significant. See also Note 2 —Significant Accounting Policies —Recent Accounting Pronouncements for additional information. A reconciliation of the U.S. federal income tax rate of 35% for the years ended December 31, to the Company’s effective income tax rate follows (in thousands): 2017 2016 2015 Expected taxes $ 29,584 $ 7,351 $ 3,797 Non-deductible/non-taxable items 1,212 565 157 Foreign rate differences (11,656) (654) (1,267) Foreign permanent differences 416 (1,005) — Increase (decrease) in valuation allowance (1,700) (13,063) 2,052 Share-based compensation (10,348) — — Section 382 limitation — (3,065) (4,382) Changes in tax rates 2,768 (361) — Repatriation tax, net of foreign tax credit 5,067 — — Research and development credits (2,821) — — Uncertain tax positions (1,616) — — Other, net (331) 1 18 Tax (benefit) expense $ 10,575 $ (10,231) $ 375 The Company’s provision for income taxes in 2017 was higher than in 2016 primarily due to an increase in pre-tax income and the provisional effect of the 2017 Tax Act, partially offset by excess tax benefits from stock-based compensation and recording research and development credits, including a portion of which were previously uncertain. The 2017 changes in tax laws or rates includes an estimate of the impact due to change in US tax rate of $2.8 million and an estimate of the repatriation tax of $5.0 million, as discussed further below. The Company’s provision for income taxes in 2016 was lower than in 2015 primarily due to the release of its valuation allowances on U.S. and Taiwan deferred income taxes, partially offset by an increase in pre-tax income. The Company’s wholly owned subsidiary, Prime World is a tax-exempt entity under the Income Tax Code of the British Virgin Islands. The Company’s wholly owned subsidiary, Global Technology, Inc., has enjoyed preferential tax concessions in China as a national high-tech enterprise. In March 2007, China’s parliament enacted the PRC Enterprise Income Tax Law, or the EIT Law, under which, effective January 1, 2008, China adopted a uniform income tax rate of 25% for all enterprises including foreign invested enterprises. Global Technology, Inc. was recognized as a National high-tech enterprise in 2008 and was entitled to a 15% tax rate for a three year period from November 2008 to November 2017. Global Technology, Inc. renewed its National high-tech enterprise certificate and was therefore extended its three-year tax preferential status from November 2017 to November 2020. This tax holiday reduced its 2017 income tax provision by approximately $1.4 million, but had no overall effect on the 2016 and 2015 income tax provision due to a full valuation allowance. This tax holiday increased its fiscal 2017 diluted earnings per share by approximately $0.07, but had no effect on its 2016 or 2015 diluted earnings per share due to the full valuation allowance. Effective January 1, 2016, China expanded the scope of the National high-tech enterprise to include additional deductions for qualifying research and development. In general, it is the Company’s practice and intention to reinvest the earnings of its non-U.S. subsidiaries in those operations. The 2017 Tax Act includes a mandatory one-time tax on accumulated earnings of foreign subsidiaries, and as a result, all previously unremitted earnings for which no U.S. deferred tax liability had been accrued have now been subject to U.S. tax. As of December 31, 2017, the Company had not made a provision for state income taxes or additional foreign withholding taxes on approximately $63 million of the excess of the amount for financial reporting over the tax basis of investments in foreign subsidiaries that is indefinitely reinvested outside the U.S. While the transition tax described below results in a reduction to undistributed foreign earnings to tax in the future, an actual repatriation from our foreign subsidiaries could still be subject to additional foreign withholding taxes and U.S. state taxes. The Company will record the tax effects of any change in its prior assertion with respect to these investments, and disclose any unrecognized deferred tax liability for temporary differences related to its foreign investments, if practicable, in the period that the Company is first able to make a reasonable estimate. As of December 31, 2017, December 31, 2016 and December 31, 2015, the total amount of unrecognized tax benefit was $0.2 million, $1.8 million, and $1.8 million, respectively. The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in thousands): 2017 2016 2015 Unrecognized tax benefits — January 1 $ 1,797 $ 1,797 $ 1,659 Gross increases — tax positions in prior period — 332 Gross decreases — tax positions in prior period (1,616) — (194) Unrecognized tax benefits — December 31 $ 181 $ 1,797 $ 1,797 As of December 31, 2017 the Company had $0.2 million of unrecognized tax benefits related to U.S. tax benefits recognized for prior branch losses. During 2017 the Company assessed its unrecognized tax benefits related to research and development credits from prior years. As a result, the Company recognized the full benefit for research and development credits and an increase in deferred tax assets in the amount of $1.6 million. As of December 31, 2016 and 2015, the Company had $1.8 million of unrecognized tax benefits related to U.S. tax benefits recognized for prior year branch losses and research and development credits, respectively. If recognized, none of the amounts would have an impact on the Company’s effective tax rate, but rather would result in adjustments to other tax accounts, primarily deferred taxes. The Company believes that it is reasonably possible that none of its remaining unrecognized tax positions may be recognized by the end of 2018. The Company recognizes interest accrued related to unrecognized tax benefits and penalties as income tax expense. Related to the unrecognized tax benefits noted above, it has not accrued penalties or interest during 2017 as a result of net operating losses. During 2016, the Company also accrued no penalties or interest. The Company is subject to taxation in the United States and various states and foreign jurisdictions. The Company’s open tax years subject to examination in the U.S. federal and state jurisdictions are 2014 through 2016. To the extent allowed by law, the taxing authorities may have the right to examine prior periods where net operating losses or tax credits were generated and carried forward, and make adjustments up to the amount of the net operating loss or tax credit carryforward. The Company is subject to examination for tax years 2009 forward for various foreign jurisdictions. . Effects of the Tax Cuts and Jobs Act On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). On December 22, 2017, H.R.1, known as the "Tax Cuts and Jobs Act," was signed into law. The Tax Act makes broad and complex changes to the U.S. tax code, including, but not limited to, (1) reducing the U.S. federal corporate tax rate from 35 percent to 21 percent; (2) requiring companies to pay a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries; (3) generally eliminating U.S. federal income taxes on dividends from foreign subsidiaries; (4) a new provision designed to tax global intangible low-taxed income (GILTI); (5) eliminating the corporate alternative minimum tax (AMT) and changing how existing AMT credits can be realized; (6) creating the base erosion anti-abuse tax (BEAT), a new minimum tax; (7) creating a new limitation on deductible interest expense; and (8) changing rules related to uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017. Among other things, the Tax Act permanently lowers the corporate tax rate to 21 percent from the existing maximum rate of 35 percent, subjecting foreign earnings in excess of an allowable return to U.S. taxation, adopting a territorial tax regime and imposing a one-time transitional tax on deemed repatriated earnings of foreign subsidiaries (“repatriation tax), effective for tax years including or commencing January 1, 2018. As a result of the reduction of the corporate tax rate to 21 percent, U.S. generally accepted accounting principles require companies to revalue their deferred tax assets and liabilities with resulting tax effects accounted for in the reporting period of enactment. The Company estimates that the change in tax rate will have an impact of $2.8 million, while the Company estimates the repatriation tax will have an impact of $5.0 million, based on $9.0 million of income tax, offset by foreign tax credits of $4.0 million. The Tax Act reduces the corporate tax rate to 21 percent, effective January 1, 2018. Consequently, the Company has recorded a decrease related to Deferred Tax Assets of $2.8 million, with a corresponding net adjustment to deferred income tax expense of $2.8 million for the year ended December 31, 2017. While the Company is able to make a reasonable estimate of the impact of the reduction in corporate rate, it may be affected by other analyses related to the Tax Act, including, but not limited to, the calculation of deemed repatriation of deferred foreign income and the state tax effect of adjustments made to federal temporary differences. The Deemed Repatriation Transition Tax (Transition Tax) is a tax on previously untaxed accumulated and current earnings and profits (E&P) of certain of the Company’s foreign subsidiaries. To determine the amount of the Transition Tax, the Company must determine, in addition to other factors, the amount of post-1986 E&P of the relevant subsidiaries, as well as the amount of non-U.S. income taxes paid on such earnings. The Company is able to make a reasonable estimate of the Transition Tax and recorded a provisional Transition Tax obligation of $5.0 million. However, the Company is continuing to gather additional information to more precisely compute the amount of the Transition Tax. The Tax Act creates a new requirement that certain income (i.e., GILTI) earned by controlled foreign corporations (CFCs) must be included currently in the gross income of the CFCs’ U.S. shareholder. Because of the complexity of the new GILTI tax rules, the Company is continuing to evaluate this provision of the Tax Act and the application of ASC 740. Under U.S. GAAP, the Company is allowed to make an accounting policy choice of either (1) treating taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (the “period cost method”) or (2) factoring such amounts into a company’s measurement of its deferred taxes (the “deferred method”). The Company selected the period cost method. Because whether the Company expects to have future U.S. inclusions in taxable income related to GILTI depends on not only its current structure and estimated future results of global operations but also its intent and ability to modify its structure and/or its business, the Company is not yet able to reasonably estimate the effect of this provision of the Tax Act. The Tax Act also repealed corporate AMT for tax years beginning after December 31, 2017. AMT credit carryforwards that have not yet been used may be refunded in future years even though no income tax liability exists or continue to offset any regular income tax liability in years 2018 through 2020. The Company has continued to present the AMT credit carryforwards as a deferred tax asset until the period in which amounts are determined to be recoverable as a refund. The Company also recognized a provisional reduction to net deferred tax assets of $0.7 million attributable to the accelerated depreciation for certain assets placed into service after September 27, 2017. This provisional adjustment resulted in a decrease in income tax payable of $1.1 million. The income tax effects for this position requires further analysis due to the volume of data required to complete the calculations, and the Company expects to complete that analyses in the second half of 2018. In connection with the Company’s initial analysis of the impact of the Tax Act and based on its best estimate of the impact of the Tax Act in the Company’s year end income tax provision in accordance with its understanding of the Act and guidance available as of the date of this filing, the Company does not expect other provisions of the Act, such as the BEAT provisions, interest limitations, and NOL limitations to have a material impact on the financial statements.

M. SHARE-BASED COMPENSATION

M. SHARE-BASED COMPENSATION	12 Months Ended
	Dec. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
SHARE-BASED COMPENSATION	NOTE M—SHARE-BASED COMPENSATION Equity Plans The Company’s board of directors and stockholders approved the following equity plans: · the 1998 Share Incentive Plan · the 2000 Share Incentive Plan · the 2004 Share Incentive Plan · the 2006 Share Incentive Plan · the Amended and Restated 2013 Equity Incentive Plan (“2013 Plan”) The Company issues stock options to employees, consultants and non-employee directors. Stock option awards generally vest over a four year period and have a maximum term of ten years. Stock options under these plans have been granted with an exercise price equal to the fair market value on the date of the grant. Nonqualified and Incentive Stock Options and restrictive stock units (“RSUs”) may be granted from these plans. Prior to the Company’s initial public offering in September 2013, the fair market value of the Company’s stock had been historically determined by the board of directors and from time to time with the assistance of third party valuation specialists. Stock Options Options have been granted to the Company’s employees under the five incentive plans and generally become exercisable as to 25% of the shares on the first anniversary date following the date of grant and semi-annually thereafter. All options expire ten years after the date of grant. The following is a summary of option activity (shares and intrinsic values in thousands): Weighted Weighted Weighted Average Average Average Share Price Weighted Remaining Aggregate Number of Exercise on Date of Average Contractual Intrinsic shares Price Exercise Fair Value Life Value Outstanding, January 1, 2015 1,423 $ 8.96 4.48 $ 3,486 Exercised (81) 7.09 $ 16.53 2.62 762 Forfeited (32) 8.96 4.43 212 Outstanding, December 31, 2015 1,310 9.07 4.59 10,598 Exercised (159) 6.91 $ 19.90 2.56 2,071 Forfeited (21) 7.96 3.29 273 Outstanding, December 31, 2016 1,130 9.40 4.90 15,872 Exercised (418) 8.56 $ 59.31 4.51 21,224 Forfeited (176) 9.42 4.97 4,998 Outstanding, December 31, 2017 536 $ 10.04 $ 5.19 5.62 $ 14,888 Exercisable, December 31, 2017 525 $ 9.96 5.61 $ 12,499 Vested and expected to vest 536 $ 10.04 5.62 $ 14,888 As of December 31, 2017, there was approximately $12,000 of unrecognized stock option expense, net of estimated forfeitures, which is expected to be recognized over 0.08 years. Restricted Stock Unit/Awards The following is a summary of RSU/RSA activity (shares and intrinsic values in thousands): Weighted Average Share Weighted Aggregate Number of Price on Date Average Fair Intrinsic shares of Release Value Value Outstanding at January 1, 2015 21 18.22 238 Granted 156 $ 13.62 11.06 1,722 Released (19) 18.24 257 Cancelled/Forfeited (6) 10.00 99 Outstanding, December 31, 2015 152 11.20 2,611 Granted 497 $ 13.50 15.73 7,815 Released (122) 14.09 1,644 Cancelled/Forfeited (10) 15.38 180 Outstanding, December 31, 2016 517 14.79 12,128 Granted 510 38.87 19,803 Released (289) $ 60.87 20.92 17,579 Cancelled/Forfeited (31) 24.23 1,181 Outstanding, December 31, 2017 707 $ 29.23 $ 26,732 Exercisable, December 31, 2017 4 $ 140 Vested and expected to vest 703 $ 26,592 The aggregate intrinsic value of RSUs and RSAs outstanding at December 31, 2017 was $26.7 million. Unrecognized compensation expense related to these RSUs and RSAs at December 31, 2017 was $18.8 million. This expense is expected to be recognized over 2.82 years. Share-Based Compensation The Company recognizes compensation expense on a straight-line basis over the applicable vesting term of the award and expense is adjusted as forfeitures occur. In 2014, the Company ceased issuing stock options and began issuing RSUs and RSAs as share-based compensation to employees. The Company estimates the fair value of RSUs and RSAs at the fair market value on the grant date. Employee share-based compensation expenses recognized for the years ended December 31, were as follows (in thousands): Share-Based compensation - by expense type: 2017 2016 2015 Cost of goods sold $ 461 $ 190 $ 70 Research and development 1,496 591 230 Sales and marketing 481 357 217 General and administrative 5,357 2,695 1,603 Total share-based compensation expense $ 7,795 $ 3,833 $ 2,120 Share-Based compensation - by award type: 2017 2016 2015 Employee stock options $ 853 $ 1,460 $ 1,538 Restricted stock units 6,942 2,373 582 Total share-based compensation expense $ 7,795 $ 3,833 $ 2,120

N. STOCKHOLDERS' EQUITY

N. STOCKHOLDERS' EQUITY	12 Months Ended
	Dec. 31, 2017
Equity [Abstract]
STOCKHOLDERS' EQUITY	NOTE N—STOCKHOLDERS’ EQUITY Common Stock The Company’s Amended and Restated Certificate of Incorporation authorizes the issuance of up to 45,000,000 shares of common stock, all of which have been designated voting common stock. Preferred Stock The Company’s Amended and Restated Certificate of Incorporation authorizes the issuance of up to 5,000,000 shares of preferred stock. Warrants As of December 31, 2017 and 2016, the Company had no outstanding warrants to purchase common or preferred stock. Public Offerings of Common Stock On June 3, 2015, the Company filed a Registration Statement on Form S-3 (the “Form S-3”) with the Securities and Exchange Commission effective June 23, 2015, providing for the public offer and sale of certain securities of the Company from time to time, at its discretion, up to an aggregate amount of $140 million. In connection with the Company’s Form S-3, the Company entered into an Equity Distribution Agreement with Raymond James & Associates, Inc. (the “sales agent”) pursuant to which the Company may issue and sell shares of the Company’s stock having an aggregate offering price of up to $40 million (the “ATM Offering”) from time to time through the sales agent. On July 16, 2015, the Company commenced sales of common stock through the ATM Offering. The Company completed its ATM Offering in August 2015 and sold 1.9 million shares at a weighted average price of $21.54 per share, providing proceeds of $38.6 million, net of expenses and underwriting discounts and commissions. On October 17, 2016, the Company filed a Registration Statement on Form S-3 with the Securities and Exchange Commission effective November 1, 2016, providing for the public offer and sale of certain securities of the Company from time to time, at its discretion, up to an aggregate amount of $250 million. In connection with such Form S-3, the Company entered into an Equity Distribution Agreement with Raymond James & Associates, Inc. pursuant to which the Company may issue and sell shares of the Company’s stock having an aggregate offering price of up to $50.0 million (the “Second ATM Offering”) from time to time through Raymond James & Associates, Inc. On November 22, 2016, the Company commenced sales of common stock through the Second ATM Offering. The Company completed its Second ATM Offering in March 2017 and sold 1.6 million shares of common stock at a weighted average price of $31.55 per share, providing proceeds of $48.8 million, net of expenses and underwriting discounts and commissions. Recovery of Stockholder Short Swing Profit In November 2015, a member of the board of directors of the Company paid $6,000 to the Company, representing the disgorgement of short swing profits under Section 16(b) under the Exchange Act. The amount was recorded as additional paid-in capital.

O. SEGMENT AND GEOGRAPHIC INFOR

O. SEGMENT AND GEOGRAPHIC INFORMATION	12 Months Ended
	Dec. 31, 2017
Segment Reporting [Abstract]
SEGMENT AND GEOGRAPHIC INFORMATION	NOTE O—SEGMENT AND GEOGRAPHIC INFORMATION The Company operates in one reportable segment. The Company’s Chief Executive Officer, who is considered to be the chief operating decision maker, manages the Company’s operations as a whole and reviews financial information presented on a consolidated basis, accompanied by information about product revenue, for purposes of evaluating financial performance and allocating resources. The following tables set forth the Company’s revenue and asset information by geographic region. Revenue is classified based on the location of where the product is manufactured. Long-lived assets in the tables below comprise only property, plant, equipment and intangible assets (in thousands): For the years ended December 31, 2017 2016 2015 Revenues: United States $ 18,209 $ 18,035 $ 16,766 Taiwan 241,820 161,611 141,107 China 122,300 81,067 32,030 $ 382,329 $ 260,713 $ 189,903 As of December 31, 2017 2016 2015 Long-lived assets: United States $ 75,446 $ 66,028 $ 44,280 Taiwan 67,379 48,728 45,420 China 59,929 34,113 24,753 $ 202,754 $ 148,869 $ 114,453 The Company serves four primary markets, the internet data center, CATV, telecom and FTTH markets. Of the Company’s total revenues in 2017, the Company earned $306.7 million, or 80.2%, from the internet data center market, $60.8 million, or 15.9%, from the CATV market, $0.5 million, or 0.1%, from the FTTH market and $12.9 million, or 3.4%, from the telecom market. Of the Company’s total revenues in 2016, the Company earned $201.3 million, or 77.2%, from the internet data center market, $43.6 million, or 16.7%, from the CATV market, $12.9 million, or 5.0%, from the telecom market and $1.6 million, or 0.6%, from the FTTH market. Of the Company’s total revenues in 2015, the Company earned $123.2 million, or 64.9%, from the internet data center market, $53.7 million, or 28.3%, from the CATV market, $9.7 million, or 5.1%, from the telecom market and $2.5 million, or 1.3%, from the FTTH market.

P. EMPLOYEE BENEFIT PLANS

P. EMPLOYEE BENEFIT PLANS	12 Months Ended
	Dec. 31, 2017
Compensation and Retirement Disclosure [Abstract]
EMPLOYEE BENEFIT PLANS	NOTE P—EMPLOYEE BENEFIT PLANS On August 1, 2000, the Company established a 401(k) profit sharing plan covering employees meeting certain age and service requirements. The plan provides for discretionary Company contributions to be allocated based on the employee’s eligible contributions. The Company made contributions of $0.6 million, $0.6 million and $0.4 million to the 401(k) plan for the years ended December 31, 2017, 2016 and 2015, respectively. Employees of Global participate in a state-mandated social security program in China. Under this program, pension costs are recorded on the basis of required monthly contributions to employees’ individual accounts during their service periods. Under the regulations of the People’s Republic of China, Global is required to make fixed contributions to a fund, which is under the administration of the local labor departments. Employees of the Company’s Taiwan branch participate in a pension program under the Taiwan Labor Pension Act. Pension expense for Global was $0.8 million, $0.6 million and $0.3 million in the years ended for the year ended December 31, 2017, 2016 and 2015, respectively. Pension expense for the Company’s Taiwan branch was $0.9 million, $0.8 million and $0.6 million for the years ended December 31, 2017, 2016 and 2015, respectively.

Q. COMMITMENTS AND CONTINGENCIE

Q. COMMITMENTS AND CONTINGENCIES	12 Months Ended
	Dec. 31, 2017
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE Q—COMMITMENTS AND CONTINGENCIES Commitments The Company conducts part of its operations from leased facilities and also leases equipment. Rent expense was each $1.1 million for the years ended December 31, 2017, 2016 and 2015, respectively. The Company entered into a long-term lease agreement for land use rights in China. The agreement specified a lease fee of $5.0 million of which $1.1 million was paid in 2017 and the remaining $3.9 million will be paid in 2018. At December 31, 2017, the approximate minimum rental commitments under noncancellable leases in excess of one year that expire at varying dates through 2029 were as follows (in thousands): Year ending December 31, Amount 2018 $ 1,066 2019 1,015 2020 1,007 2021 1,020 2022 1,020 thereafter 6,954 $ 12,082 The Company entered into a long-term lease agreement for land use rights in China. The agreement specified a lease fee of $5.0 million of which $1.1 million was paid in 2017 and the remaining $3.9 million will be paid in 2018. Employment Agreements and Consultancy Agreements The Company has entered into employment and indemnification agreements with three executive officers. These agreements provide that if their employment is terminated as a result of a change of control of the Company, or if their employment is terminated for certain other reasons set forth in the agreements, the Company will be required to pay a severance payment in an amount equal to their annual base salary, and other additional compensation due under the terms of the agreements. The Company has also entered into employment and indemnification agreements with one other executive officer. These agreements provide that if their employment is terminated as a result of a change of control of the Company, the Company will be required to pay a severance payment in an amount equal to their six months of their annual base salary, and other additional compensation due under the terms of the agreements. Contingencies From time to time, the Company may be subject to legal proceedings and litigation arising in the ordinary course of business, including, but not limited to, inquiries, investigations, audits and other regulatory proceedings, such as described below. Except for the lawsuit described below, the Company believes that there are no claims or actions pending or threatened against us, the ultimate disposition of which would have a material adverse effect on it. On August 5, 2017, a lawsuit was filed in the U.S. District Court for the Southern District of Texas against the Company and two of its officers in Mona Abouzied v. Applied Optoelectronics, Inc., Chih-Hsiang (Thompson) Lin, and Stefan J. Murry, et al. , Case No. 4:17-cv-02399. The complaint in this matter seeks class action status on behalf of the Company’s shareholders, alleging violations of Sections 10(b) and 20(a) of the Exchange Act against the Company, its chief executive officer, and its chief financial officer, arising out of the Company’s announcement on August 3, 2017 that “we see softer than expected demand for our 40G solutions with one of our large customers that will offset the sequential growth and increased demand we expect in 100G.” The original complaint requests unspecified damages and other relief. The Company disputes the allegations set forth in the original complaint and intends to vigorously contest the matter. An amended complaint is due to be filed in this matter by March 5, 2018.

R. SUBSEQUENT EVENTS

R. SUBSEQUENT EVENTS	12 Months Ended
	Dec. 31, 2017
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE R—SUBSEQUENT EVENTS The Company has evaluated subsequent events through the date the financial statements were issued. On January 8, 2018, the Company repaid its revolving bank line of credit of $49 million. On February 8, 2018, the Company’s Chinese subsidiary, Global, entered into a 187.8 million RMB, equivalent to approximately $30.3 million USD, Construction Agreement (the “Agreement”) with Zhejiang Xinyu Construction Group Co., Ltd. (the “General Contractor”). Pursuant to the Agreement the General Contractors agree to construct a new 744,000 square feet industrial facility (the “New Facility”), to be located at the V-03-1 plot of Wangchun Industrial Park in Ningbo, China. The New Facility will be used to expand Global’s current design and manufacturing capabilities. The construction of the New Facility is anticipated to begin on March 10, 2018 and has a targeted completion date of September 1, 2019.

S. SELECTED QUARTERLY FINANCIAL

S. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)	12 Months Ended
	Dec. 31, 2017
Quarterly Financial Information Disclosure [Abstract]
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)	NOTE S—Selected Quarterly Financial Data (unaudited) The following tables set forth a summary of the Company’s quarterly financial information for each of the four quarters for the years ended December 31, 2017 and 2016 (in thousands, except per share data): First Second Third Fourth Year ended December 31, 2017 Quarter Quarter Quarter Quarter Revenue $ 96,224 $ 117,371 $ 88,879 $ 79,855 Cost of goods sold 54,752 64,089 49,507 47,701 Gross profit 41,472 53,282 39,372 32,154 Gross margin Operating expenses: Research and development 7,432 8,073 9,190 10,670 Sales and marketing 1,903 2,158 2,551 2,090 General and administrative 7,822 8,786 9,580 9,074 Total operating expenses 17,157 19,017 21,321 21,834 Income from operations 24,315 34,265 18,051 10,320 Interest and other income (expense), net (872) (111) (541) (901) Net income before taxes 23,443 34,154 17,510 9,419 Income tax (expense) benefit (3,654) (5,083) 1,865 (3,703) Net income $ 19,789 $ 29,071 $ 19,375 $ 5,716 Net income per share—basic $ 1.06 $ 1.52 $ 1.00 $ 0.29 Net income per share—diluted $ 1.00 $ 1.43 $ 0.95 $ 0.28 First Second Third Fourth Year ended December 31, 2016 Quarter Quarter Quarter Quarter Revenue $ 50,422 $ 55,254 $ 70,137 $ 84,900 Cost of goods sold 36,169 37,952 46,976 52,662 Gross profit 14,253 17,302 23,161 32,238 Gross margin Operating expenses: Research and development 8,396 7,814 8,362 7,208 Sales and marketing 1,680 1,610 1,594 1,743 General and administrative 5,733 5,906 6,445 7,443 Total operating expenses 15,809 15,330 16,401 16,394 Income (loss) from operations (1,556) 1,972 6,760 15,844 Interest and other income (expense), net 34 (1,317) (356) (378) Net income (loss) before taxes (1,522) 655 6,404 15,466 Income tax (expense) benefit 192 (52) 11,332 (1,241) Net income (loss) $ (1,330) $ 603 $ 17,736 $ 14,225 Net income (loss) per share—basic $ (0.08) $ 0.04 $ 1.03 $ 0.81 Net income (loss) per share—diluted $ (0.08) $ 0.03 $ 0.97 $ 0.77

B. SUMMARY OF SIGNIFICANT ACC27

B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Dec. 31, 2017
Accounting Policies [Abstract]
Basis of Presentation	1. Basis of Presentation The consolidated financial statements include the accounts of the Company and all of its wholly-owned subsidiaries and are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). All intercompany balances and transactions have been eliminated in consolidation.
Reclassifications	2. Reclassifications Certain amounts in the prior year’s financial statements have been reclassified to conform to the current year presentation. This reclassification includes the presentation of revenue in Note O – Segment and Geographic Revenue. In 2015, revenue by geographic region was reclassified between the United States, Taiwan and China to conform to the current year presentation by classifying consigned inventory revenue based on manufacturing location rather than consignment sale location.
Use of Estimates	3. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ from those estimates in the consolidated financial statements and accompanying notes. Significant estimates and assumptions that impact these financial statements relate to, among other things, allowance for doubtful accounts, inventory reserve, product warranty costs, share-based compensation expense, estimated useful lives of property and equipment, and taxes.
Foreign Currency Translation	4. Foreign Currency Translation The functional currency for the Company’s foreign operations is the local currency. The assets and liabilities of these operations are translated at the rate of exchange in effect on the balance sheet date and sales and expenses are translated at monthly average rates. The resulting gains or losses from translation are included in a separate component of other comprehensive income. There is no tax effect on the foreign currency translation because it is management’s intent to reinvest the undistributed earnings of its foreign subsidiaries indefinitely. Transaction gains and losses resulting from re-measuring monetary asset and liability accounts that are denominated in a currency other than a subsidiary’s functional currency are included in net foreign exchange gain and loss and are included in net income except for intercompany long-term investment nature. The after-tax translation gain or losses from long-term investment nature of intercompany balances are treated as translation adjustments and included in comprehensive income.
Fair Value	5. Fair Value The carrying value of cash, cash equivalents and short-term investments, accounts receivable, accounts payable, and note receivable approximate their historical fair values due to their short-term maturities. The carrying value of the debt approximates its fair value due to the short-term nature of the debt since it renews frequently at current interest rates. Management believes that the interest rates in effect at each year end represent the current market rates for similar borrowings. The fair value measurement standard defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard characterizes inputs used in determining fair value according to a hierarchy that prioritized inputs based on the degree to which they are observable. The three levels of the fair value hierarchy are as follows: Level 1—Inputs represent quoted prices in active markets for identical assets or liabilities. Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3—Inputs that are not observable from objective sources, such as management’s internally developed assumptions used in pricing an asset or liability. Assets and liabilities that are required to be fair valued on a recurring basis include money market funds, marketable securities, equity instruments and contingent consideration. Money market funds are valued with Level 1 inputs, using quoted market prices, and are included in cash and cash equivalents on the Company’s consolidated balance sheets.
Cash and Cash Equivalents	6. Cash and Cash Equivalents The Company considers all highly liquid securities with an original maturity of ninety days or less from the date of purchase to be cash equivalents. Cash in foreign accounts was approximately $21.0 million and $10.7 million at December 31, 2017 and 2016, respectively. The Company maintains cash and cash equivalents at U.S. financial institutions for which the combined account balances in individual institutions may exceed Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. As of December 31, 2017, approximately $58.8 million of U.S. deposits were not covered by FDIC insurance. The Company has not experienced any losses and believes it is not exposed to any significant risk with such accounts.
Restricted Cash/Compensating Balances	7. Restricted Cash/Compensating Balances The Company is required to maintain a compensation deposit equal to 30% of its bank acceptance notes to vendors and a standby letter of credit issued for guaranty of its Taiwan credit facility with a China bank. The Company’s Taiwan subsidiary also uses time deposits for customs guarantees as well as compensation balances with a Taiwan bank for its credit facility. As of December 31, 2017 and 2016, the amount of restricted cash was $1.0 million and $1.7 million, respectively.
Accounts Receivable/Allowance for Doubtful Accounts	8. Accounts Receivable/Allowance for Doubtful Accounts The Company carries its accounts receivable at the net amount that it estimates to be collectible. An allowance for uncollectable accounts is maintained through a charge against operations. The allowance is determined by management review of outstanding amounts per customer, historical payments and the aging of accounts.
Concentration of Credit Risk and Significant Customers	9. Concentration of Credit Risk and Significant Customers Financial instruments which potentially subject the Company to concentrations of credit risk include cash, cash equivalents and accounts receivable. The Company places all cash and cash equivalents with high-credit quality financial institutions. The Company performs ongoing credit valuations of its customers’ financial condition whenever deemed necessary and generally does not require deposits or collateral to support customer receivables. The historical amount of losses on uncollectible accounts has been within the Company’s estimates. The Company generates much of its revenue from a limited number of customers. In 2017, 2016 and 2015, its top five customers represented 86.1%, 87.8% and 81.8% of its revenue, respectively. In 2017, Amazon, Facebook and Microsoft represented 35.4%, 28.6% and 13.8% of its revenue, respectively. In 2016, Amazon, Microsoft and Arris represented 54.6%, 18.3% and 5.8% of its revenue, respectively. In 2015, Amazon, Microsoft and Cisco represented 52.5%, 11.6% and 10.4% of its revenue, respectively. The five largest receivable balances for customers represented an aggregate of 82.6%, and 88.3% of total accounts receivable at December 31, 2017 and 2016, respectively. As of December 31, 2017, Amazon and Microsoft represented 36.1% and 19.5% of total accounts receivable, respectively. As of December 31, 2016, Amazon and Arris represented 62.1% and 10.6% of total accounts receivable, respectively. No other customer represented greater than ten percent of revenue in 2017, 2016 or 2015 or greater than ten percent of total accounts receivable at December 31, 2017 or 2016.
Inventories	10. Inventories Inventories are stated at the lower of cost (average-cost method) or market. Work in process and finished goods includes materials, labor and allocated overhead. The Company assesses the valuation of its inventory on a periodic basis and provides write-offs for the value of estimated excess and obsolete inventory based on estimates of future demand.
Property, Plant and Equipment	11. Property, Plant and Equipment Property, plant and equipment are stated at cost, net of accumulated depreciation and amortization. The Company calculates depreciation using the straight-line method over the following estimated useful lives: Useful lives Buildings 20 - 42 years Land improvements 10 years Machinery and equipment 2 - 20 years Furniture and fixtures 3 - 7 years Computer equipment and software 3 - 10 years Leasehold improvements The shorter of the life of the applicable lease or the useful life of the improvement Transportation equipment 5 years Major improvements are capitalized and expenditures for maintenance and repairs are expensed as incurred. Construction in progress represents property, plant and equipment under construction or being installed. Costs include original cost, installation, construction and other direct costs which include interest on borrowings used to finance the asset. Construction in progress is transferred to the appropriate fixed asset account and depreciation commences when the asset has been substantially completed and placed in service. Land use rights allow the Company rights for 50 years to certain land in Ningbo, China on which the Company built a facility that included office space, manufacturing operations and employee dormitories. The land use rights are recorded at cost and are amortized on the straight-line basis over the useful life of the related contract. The land use rights expire on October 7, 2054 and December 28, 2067.
Intangible Assets	12. Intangible Assets Intangible assets consist of intellectual property that is stated at cost less accumulated amortization. As of December 31, 2017, the Company had 241 total patents issued. The costs incurred to obtain such patents have been capitalized and are being amortized over an estimated life of 20 years. The Company periodically evaluates its intangible assets to determine whether events or changes in circumstances indicate that a patent or trademark may not be applicable to the Company’s current products or is no longer in use. If such a determination is made, the intangible asset is impaired and the remaining value of the patent or trademark will be expensed at that time.
Impairment of Long-Lived Assets	13. Impairment of Long-Lived Assets The Company accounts for impairment of long-lived assets in accordance with Accounting Standards Codification (“ASC”) 360, Property, Plant and Equipment , (“ASC 360”). Long-lived assets consist primarily of property, plant and equipment. In accordance with ASC 360, the Company periodically evaluates long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When triggering event indicators are present, the Company obtains appraisals on an asset by asset basis, and will recognize an impairment loss when the sum of the appraised values is less than the carrying amounts of such assets. The appraised values, based on reasonable and supportable assumptions and projections, require subjective judgments. Depending on the assumptions and estimates used, the appraised values projected in the evaluation of long-lived assets can vary within a range of outcomes. The appraisals consider the likelihood of possible outcomes in determining the best estimate for the value of the assets. The measurement for such an impairment loss is then based on the fair value of the asset as determined by the appraisals.
Comprehensive Income (Loss)	14. Comprehensive Income (Loss) ASC 220, Comprehensive Income , (“ASC 220”) establishes rules for reporting and display of comprehensive income and its components. ASC 220 requires that unrealized gains and losses on the Company’s foreign currency translation adjustments be included in comprehensive income.
Share-based Compensation	15. Share-based Compensation The Company accounts for share-based compensation in accordance with the provisions of ASC 718, Compensation—Stock Compensation . Share-based compensation expense is recognized based on the estimated grant date fair value in order to recognize compensation cost for those shares expected to vest. Compensation cost is recognized on a straight-line basis over the vesting period of the options and adjusted as forfeitures occur.
Revenue Recognition	16. Revenue Recognition The Company derives revenue from the manufacture and sale of fiber optic networking products. Revenue recognition follows the criteria of ASC 605, Revenue Recognition . Specifically, the Company recognizes revenue when persuasive evidence exists of an arrangement with a customer, usually in the form of a customer purchase order; performance obligations have been satisfied; title and risk of loss have transferred to the customer; the price is fixed or determinable; and collectability is reasonably assured.
Product Warranty	17. Product Warranty The Company generally offers a one-year limited warranty for its products but it can extend for longer periods of three to five years for certain products sold to certain customers. The Company estimates the costs that may be incurred under its basic limited warranty and records a liability for the amount of such costs at the time when product defective occurs. Factors that affect the Company’s warranty liability include the historical and anticipated rates of warranty claims and cost to repair. While the Company believes that its warranty accrual is adequate, the actual warranty costs may exceed the accrual, cost of sales will increase in the future. As of December 31, 2017 and 2016, the amount of accrued warranty was $1.1 million and $0.7 million, respectively.
Advertising Costs	18. Advertising Costs Advertising costs are charged to operations as incurred and amounted to approximately $0.3 million, $0.2 million and $0.1 million for the years ended December 31, 2017, 2016 and 2015, respectively.
Research and Development	19. Research and Development Research and development costs are charged to operations as incurred. The Company receives reimbursement for certain development costs, which are capitalized when incurred, up to the reimbursable amount.
Income Taxes	20. Income Taxes The Company accounts for income taxes in accordance with the provisions of ASC 740, Income Taxes . The liability method is used to account for deferred income taxes. Under the liability method, deferred tax assets and liabilities are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The ability to realize deferred tax assets is evaluated annually and a valuation allowance is provided if it is unlikely that the deferred tax assets will not give rise to future benefits in the Company’s tax returns. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, it recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. Accrued interest and penalties are included on the related tax liability line in the consolidated balance sheet.
Recent Accounting Pronouncements	21. Recent Accounting Pronouncements Recent Accounting Pronouncements Adopted in 2017 I n March 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-09, Improvements to Employee Share-Based Payment Accounting, to simplify several aspects of accounting for share-based payment transactions, including the following areas: accounting for excess tax benefits and tax deficiencies; classifying excess tax benefits on the statement of cash flows; accounting for forfeitures; classifying awards that permit share repurchases to satisfy statutory tax withholding requirements; classifying tax payments on behalf of employees on the statement of cash flows; and, for nonpublic entities only, determining the expected term and electing the intrinsic value measurement alternative for stock option awards. The guidance is effective for public business entities in fiscal years beginning after December 15, 2016, and in the interim periods within those fiscal years. The guidance requires a mix of prospective, modified retrospective and retrospective transition. The Company adopted the provisions of ASU 2016-09 as of January 1, 2017. The impact from adoption of the provisions related to forfeiture rates was reflected in the Company's condensed consolidated financial statements on a modified retrospective basis, resulting in an adjustment of $0.01 million to retained earnings. Provisions related to windfall tax benefits have been adopted prospectively resulting in an adjustment of $1.2 million to retained earnings. Provisions related to the statement of cash flows remain unchanged from prior periods. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows: Restricted Cash, providing guidance on the presentation of restricted cash or restricted cash equivalents in the statement of cash flows. ASU 2016-18 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The amendments in this ASU would be applied using a retrospective approach. The Company adopted the provisions of ASU 2016-18 as of July 1, 2017 with no material impact on the financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The ASU update addresses eight specific cash flow issues that currently result in diverse practices, including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination and separately identifiable cash flows and applicability of the predominance principle. ASU 2016-15 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The Company adopted the provisions of ASU 2016-15 as of July 1, 2017 with no material impact on the financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting, which clarifies when modification accounting should be applied for changes to terms or conditions of a share-based payment award. This ASU will be applied prospectively and is effective for fiscal years beginning after December 15, 2017, and interim periods within those years, with early adoption permitted. The Company adopted the provisions of ASU 2017-09 as of July 1, 2017 with no material impact on the financial statements. Recent Accounting Pronouncements Yet to be Adopted The FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The guidance is intended to improve the recognition and measurement of financial instruments. The ASU affects public and private companies, not-for-profit organizations, and employee benefit plans that hold financial assets or owe financial liabilities. The guidance is effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company plans to adopt this pronouncement in 2018 and does not expect any material impact on its financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). The amendments in ASU 2015-14 defer the effective date of ASU 2014-09 for all entities by one year. Public business entities should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. In applying the new guidance, the Company will: 1) identify the contracts with its customers, 2) identify the performance obligations in the contracts, 3) determine the transaction price, 4) allocate the transaction price to the performance obligations of the contract, and 5) recognize revenue when (or as) the Company satisfies a performance obligation. Since this guidance was issued, the Company has undertaken an accounting assessment phase focusing on developing a scoping plan and a review plan to determine the gaps between existing revenue recognition policies and the requirements of the new revenue guidance. This accounting assessment involved developing a training and education process for the Company personnel, performing sales contract walkthroughs to identify financial obligations, reviewing existing revenue streams and mapping contract features to revenue streams. As a result of this process, the Company has identified several areas where the new guidance may cause revenue recognition differences, possibly affecting either the timing or amount of revenue recognized in a given financial period. These areas include: · Revenue associated with customer rebates. In some cases, the Company offers cash rebates to certain customers when they purchase its products. Under the new guidance, any rebates expected to be offered to the customers must be deducted from the sales price of the goods in the same period in which the revenue for the products is recognized. In 2017, the aggregate amount of these rebates was immaterial and they are not expected to be material in 2018. · Timing of revenue recognition for certain engineering service contracts. From time to time, the Company undertakes engineering services for its customers. Typically, these services involve customizing or modifying products to better suit specific customer requirements. In some cases, customers pay all or a portion of the costs associated with these services. Under the new guidance, each of the services offered must be analyzed as a separate performance obligation and the timing of revenue recognition for some of these performance obligations may differ from the Company’s current practice. In 2017, the effect of these timing differences was not material, and material changes are not expected in 2018 as the Company adopts this new standard. · Revenue generated from shipping and handling activities. Depending on its agreement with its customers, the Company may in some cases provide shipping and handling services for products it sells. There is disparity in the agreements related to various customers, especially concerning the timing of transfer of control of the goods to the customer, and the relationship of this timing relative to the shipping and handling activities themselves. As a result of this disparity, in order to simplify its Accounting, the Company expects to utilize the practical expedient provided in ASC 606-10-25-18B, and treat all product shipping and handling activities as fulfillment activities, and therefore recognize the gross revenue associated with the contract, inclusive of any shipping and handling revenue. This is similar to the Company’s current practice and therefore the effect of the new guidance is immaterial. · Revenue generated from product warranty. Generally the Company offers a warranty on products it sells to its customers. The warranty period is typically one year from the date of purchase, but in some cases customers have negotiated longer warranty periods. The Company’s obligation under its warranty provision generally includes troubleshooting, repair and/or replacement of any goods that are found to have manufacturing defects. The Company has concluded that this represents an assurance-type warranty, as described in the guidance, and therefore does not constitute a separate performance obligation. Therefore, revenue associated with products, even when under warranty, will continue to be recognized on a gross basis. This is similar to the Company’s current practices and therefore the new guidance is not expected to result in a material change in revenue amount or timing. The Company plans to adopt the new standard using the modified-retrospective method on January 1, 2018, as required. On February 25, 2016, the FASB released ASU No. 2016-02, Leases, to complete its project to overhaul lease accounting. The ASU codifies ASC 842, Leases, which will replace the guidance in ASC 840. The guidance will require lessees to recognize most leases on the balance sheet for capital and operating leases. The guidance is effective for public business entities in fiscal years beginning after December 15, 2018. The Company is evaluating the impact of the accounting standard on its financial statements by reviewing the standard itself, as well as reviewing literature about the new standard produced by nationally-recognized accounting firms and other third parties. In January 2018, the FASB released guidance on the accounting for tax on the global intangible low-taxed income ("GILTI") provisions of the Tax Cuts and Jobs Act (the "Tax Act"). The GILTI provisions impose a tax on foreign income in excess of a deemed return on tangible assets of foreign corporations. The guidance indicates that either accounting for deferred taxes related to GILTI inclusions or to treat any taxes on GILTI inclusions as period cost are both acceptable methods subject to an accounting policy election. Effective the first quarter of 2018, the Company will elect to treat any potential GILTI inclusions as a period cost as it is not projecting any material impact from GILTI inclusions.

B. SUMMARY OF SIGNIFICANT ACC28

B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	12 Months Ended
	Dec. 31, 2017
Accounting Policies [Abstract]
Schedule of useful lives of property, plant and equipment	Useful lives Buildings 20 - 42 years Land improvements 10 years Machinery and equipment 2 - 20 years Furniture and fixtures 3 - 7 years Computer equipment and software 3 - 10 years Leasehold improvements The shorter of the life of the applicable lease or the useful life of the improvement Transportation equipment 5 years

C. CASH, CASH EQUIVALENTS AND29

C. CASH, CASH EQUIVALENTS AND RESTRICTED CASH (Tables)	12 Months Ended
	Dec. 31, 2017
Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents Abstract
Schedule of cash and cash equivalents	The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the statement of financial position that sum to the total of the same such amounts in the statement of cash flows (in thousands): As of December 31, 2017 2016 Cash and cash equivalents $ 82,936 $ 50,224 Restricted cash 1,012 1,740 Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 83,948 $ 51,964

D. EARNINGS PER SHARE (Tables)

D. EARNINGS PER SHARE (Tables)	12 Months Ended
	Dec. 31, 2017
Net income per share
Schedule of Computation basic and diluted net loss per share	The following table presents the computation of the basic and diluted net income per share for the periods indicated (in thousands, except per share amounts): Year ended December 31, 2017 2016 2015 Numerator: Net income $ 73,951 $ 31,234 $ 10,793 Denominator: Weighted average shares used to compute net income per share Basic 19,097 17,202 15,627 Effective of dilutive options and restricted stock units 1,042 511 906 Diluted 20,139 17,713 16,533 Net income per share Basic $ 3.87 $ 1.82 $ 0.69 Diluted $ 3.67 $ 1.76 $ 0.65

E. INVENTORIES (Tables)

E. INVENTORIES (Tables)	12 Months Ended
	Dec. 31, 2017
Inventory Disclosure [Abstract]
Schedule of inventories	At December 31, 2017 and 2016, inventories consisted of the following (in thousands): As of December 31, 2017 2016 Raw materials $ 26,648 $ 21,518 Work in process and sub-assemblies 31,060 24,334 Finished goods 18,060 5,965 $ 75,768 $ 51,817

F. PROPERTY, PLANT AND EQUIPM32

F. PROPERTY, PLANT AND EQUIPMENT (Tables)	12 Months Ended
	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
Schedule of property, plant and equipment	Property, plant and equipment consisted of the following for the periods indicated (in thousands): As of December 31, 2017 2016 Land improvements $ 806 $ 792 Building and improvements 78,785 69,368 Machinery and equipment 168,993 108,724 Furniture and fixtures 4,663 4,227 Computer equipment and software 8,248 6,836 Transportation equipment 718 236 262,213 190,183 Less accumulated depreciation and amortization (70,194) (49,175) 192,019 141,008 Construction in progress 4,823 1,989 Land 1,101 1,101 Property, plant and equipment, net $ 197,943 $ 144,098

G. INTANGIBLE ASSETS (Tables)

G. INTANGIBLE ASSETS (Tables)	12 Months Ended
	Dec. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible assets	Intangible assets consisted of the following for the periods indicated (in thousands): 2017 Gross Accumulated Intangible Amount amortization assets, net Patents $ 6,524 $ (2,519) $ 4,005 Trademarks 14 (12) 2 Total intangible assets $ 6,538 $ (2,531) $ 4,007 2016 Gross Accumulated Intangible Amount amortization assets, net Patents $ 5,987 $ (1,997) $ 3,990 Trademarks 14 (11) 3 Total intangible assets $ 6,001 $ (2,008) $ 3,993
Approximate amortization expense for intangible assets	At December 31, 2017, future amortization expense for intangible assets is estimated to be (in thousands): 2018 $ 485 2019 485 2020 485 2021 486 2022 486 thereafter 1,580 $ 4,007

H. FAIR VALUE OF FINANCIAL IN34

H. FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)	12 Months Ended
	Dec. 31, 2017
Fair Value Disclosures [Abstract]
Schedule of assets and liabilities at fair value	The following table presents a summary of the Company’s financial instruments measured at fair value on a recurring basis as of December 31, 2017 (in thousands): Quoted prices Significant in active other markets for observable Significant identical remaining unobservable assets (Level 1) inputs (Level 2) inputs (Level 3) Total Assets: Cash and cash equivalents $ 82,936 $ — $ — $ 82,936 Restricted cash 1,012 — — 1,012 Short term investments 36 — — 36 Total assets $ 83,984 $ — $ — $ 83,984 Liabilities: Bank acceptance payable — $ — — $ — Total liabilities $ — $ — $ — $ — The following table presents a summary of the Company’s financial instruments measured at fair value on a recurring basis as of December 31, 2016 (in thousands): Quoted prices Significant in active other markets for observable Significant identical remaining unobservable assets (Level 1) inputs (Level 2) inputs (Level 3) Total Assets: Cash and cash equivalents $ 50,224 $ — $ — $ 50,224 Restricted cash 1,740 — — 1,740 Short term investments 44 — — 44 Total assets $ 52,008 $ — $ — $ 52,008 Liabilities: Bank acceptance payable — $ 307 — $ 307 Total liabilities $ — $ 307 $ — $ 307

I. NOTES PAYABLE AND LONG-TER35

I. NOTES PAYABLE AND LONG-TERM DEBT (Tables)	12 Months Ended
	Dec. 31, 2017
Debt Disclosure [Abstract]
Schedule of notes payable and long-term debt	Notes payable and long-term debt consisted of the following for the periods indicated (in thousands): December 31, 2017 2016 Revolving line of credit with a U.S. bank up to $50,000 with interest at LIBOR plus 1.5%, maturing September 28, 2020 $ 49,000 $ — Term loan with a U.S. bank with monthly payments of principal and interest at LIBOR plus 2% — 2,925 Term loan with a U.S. bank with monthly payments of principal and interest at LIBOR plus 2% — 9,500 Term loan with a U.S. bank with monthly payments of principal and interest at LIBOR plus 2% — 21,670 Notes payable to a finance company due in monthly installments with 4.5% interest, maturing May 27, 2018 559 2,919 Notes payable to a finance company due in monthly installments with 4% interest, maturing March 31, 2019 — 5,812 Total 49,559 42,826 Less current portion (559) (7,865) Non-current portion $ 49,000 $ 34,961 Bank Acceptance Notes Payable Bank acceptance notes issued to vendors with a zero percent interest rate $ — $ 307
Maturities of notes payable and long-term debt	Maturities of notes payable and long-term debt are as follows for the future years ending December 31 (in thousands): 2018 $ 559 2019 — 2020 49,000 2021 — 2022 — 2023 and thereafter — Total outstanding $ 49,559

J. ACCRUED LIABILITIES (Tables)

J. ACCRUED LIABILITIES (Tables)	12 Months Ended
	Dec. 31, 2017
Payables and Accruals [Abstract]
Schedule of accrued liabilities	Accrued liabilities consisted of the following for the periods indicated (in thousands): As of December 31, 2017 2016 Accrued payroll $ 11,693 $ 9,231 Accrued rent 1,180 959 Accrued employee benefits 2,035 1,572 Accrued state and local taxes 951 607 Advance payments 441 252 Accrued product warranty 1,118 705 Accrued commission expenses 425 205 Accrued professional fees 181 163 Accrued other 1,079 758 $ 19,103 $ 14,452

K. OTHER INCOME AND EXPENSE (Ta

K. OTHER INCOME AND EXPENSE (Tables)	12 Months Ended
	Dec. 31, 2017
Other income (expense)
Schedule of other income and expense	Other income and expense consisted of the following for the periods indicated (in thousands): Year ended December 31, 2017 2016 2015 Foreign exchange transaction loss $ (2,012) $ (617) $ (1,847) Government subsidy income 211 164 217 Other non-operating gain 110 32 117 Loss on disposal of assets (97) (126) (78) $ (1,788) $ (547) $ (1,591)

L. INCOME TAXES (Tables)

L. INCOME TAXES (Tables)	12 Months Ended
	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Income or loss from operations before income taxes	The sources of the Company’s income from operations before income taxes were as follows (in thousands): Year ended December 31, 2017 2016 2015 Domestic $ 17,497 $ 10,047 14,062 Foreign 67,029 10,956 (2,894) Total income before income taxes $ 84,526 $ 21,003 11,168
Provision for income tax expense	The provision for income tax expense (benefit) for the years ended December 31, was as follows (in thousands): Current: 2017 2016 2015 Federal $ — $ (15) $ 168 State (292) 256 207 Foreign 10,965 962 — Total $ 10,673 $ 1,203 $ 375 Deferred: Federal $ 2,015 $ (10,794) $ — State (1,669) (130) — Foreign (444) (510) — Total $ (98) $ (11,434) $ — Income tax (benefit) expense $ 10,575 $ (10,231) $ 375
Net deferred tax assets and liabilities	At December 31, the net deferred tax assets and liabilities are comprised of the following approximate amounts (in thousands): 2017 2016 NOL carryforward $ 7,739 $ 12,866 Inventory reserves 837 869 AMT credit 345 424 Unrealized gains and losses 92 (6) Share-based compensation 732 1,453 Foreign tax credit 2,018 — Research and development credits 4,626 — Other 573 255 Deferred tax assets 16,962 15,861 Less valuation allowance — (1,663) Deferred tax assets, net 16,962 14,198 Depreciation and amortization (4,161) (2,777) Deferred tax liabilities (4,161) (2,777) Deferred tax assets, net $ 12,801 $ 11,421
Reconciliation of the U.S. federal income tax rate	A reconciliation of the U.S. federal income tax rate of 35% for the years ended December 31, to the Company’s effective income tax rate follows (in thousands): 2017 2016 2015 Expected taxes $ 29,584 $ 7,351 $ 3,797 Non-deductible/non-taxable items 1,212 565 157 Foreign rate differences (11,656) (654) (1,267) Foreign permanent differences 416 (1,005) — Increase (decrease) in valuation allowance (1,700) (13,063) 2,052 Share-based compensation (10,348) — — Section 382 limitation — (3,065) (4,382) Changes in tax rates 2,768 (361) — Repatriation tax, net of foreign tax credit 5,067 — — Research and development credits (2,821) — — Uncertain tax positions (1,616) — — Other, net (331) 1 18 Tax (benefit) expense $ 10,575 $ (10,231) $ 375
Schedule of unrecognized tax benefits	The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in thousands): 2017 2016 2015 Unrecognized tax benefits — January 1 $ 1,797 $ 1,797 $ 1,659 Gross increases — tax positions in prior period — 332 Gross decreases — tax positions in prior period (1,616) — (194) Unrecognized tax benefits — December 31 $ 181 $ 1,797 $ 1,797

M. SHARE-BASED COMPENSATION (Ta

M. SHARE-BASED COMPENSATION (Tables)	12 Months Ended
	Dec. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Summary of option activity	The following is a summary of option activity (shares and intrinsic values in thousands): Weighted Weighted Weighted Average Average Average Share Price Weighted Remaining Aggregate Number of Exercise on Date of Average Contractual Intrinsic shares Price Exercise Fair Value Life Value Outstanding, January 1, 2015 1,423 $ 8.96 4.48 $ 3,486 Exercised (81) 7.09 $ 16.53 2.62 762 Forfeited (32) 8.96 4.43 212 Outstanding, December 31, 2015 1,310 9.07 4.59 10,598 Exercised (159) 6.91 $ 19.90 2.56 2,071 Forfeited (21) 7.96 3.29 273 Outstanding, December 31, 2016 1,130 9.40 4.90 15,872 Exercised (418) 8.56 $ 59.31 4.51 21,224 Forfeited (176) 9.42 4.97 4,998 Outstanding, December 31, 2017 536 $ 10.04 $ 5.19 5.62 $ 14,888 Exercisable, December 31, 2017 525 $ 9.96 5.61 $ 12,499 Vested and expected to vest 536 $ 10.04 5.62 $ 14,888
Summary of RSU/RSA activity	The following is a summary of RSU/RSA activity (shares and intrinsic values in thousands): Weighted Average Share Weighted Aggregate Number of Price on Date Average Fair Intrinsic shares of Release Value Value Outstanding at January 1, 2015 21 18.22 238 Granted 156 $ 13.62 11.06 1,722 Released (19) 18.24 257 Cancelled/Forfeited (6) 10.00 99 Outstanding, December 31, 2015 152 11.20 2,611 Granted 497 $ 13.50 15.73 7,815 Released (122) 14.09 1,644 Cancelled/Forfeited (10) 15.38 180 Outstanding, December 31, 2016 517 14.79 12,128 Granted 510 38.87 19,803 Released (289) $ 60.87 20.92 17,579 Cancelled/Forfeited (31) 24.23 1,181 Outstanding, December 31, 2017 707 $ 29.23 $ 26,732 Exercisable, December 31, 2017 4 $ 140 Vested and expected to vest 703 $ 26,592
Schedule of employee stock-based compensation expenses	Employee share-based compensation expenses recognized for the years ended December 31, were as follows (in thousands): Share-Based compensation - by expense type: 2017 2016 2015 Cost of goods sold $ 461 $ 190 $ 70 Research and development 1,496 591 230 Sales and marketing 481 357 217 General and administrative 5,357 2,695 1,603 Total share-based compensation expense $ 7,795 $ 3,833 $ 2,120 Share-Based compensation - by award type: 2017 2016 2015 Employee stock options $ 853 $ 1,460 $ 1,538 Restricted stock units 6,942 2,373 582 Total share-based compensation expense $ 7,795 $ 3,833 $ 2,120

O. SEGMENT AND GEOGRAPHIC INF40

O. SEGMENT AND GEOGRAPHIC INFORMATION (Tables)	12 Months Ended
	Dec. 31, 2017
Segment Reporting [Abstract]
Revenue information by geographic region	The following tables set forth the Company’s revenue and asset information by geographic region. Revenue is classified based on the location of where the product is manufactured. Long-lived assets in the tables below comprise only property, plant, equipment and intangible assets (in thousands): For the years ended December 31, 2017 2016 2015 Revenues: United States $ 18,209 $ 18,035 $ 16,766 Taiwan 241,820 161,611 141,107 China 122,300 81,067 32,030 $ 382,329 $ 260,713 $ 189,903
Long-lived assets by geographic region	As of December 31, 2017 2016 2015 Long-lived assets: United States $ 75,446 $ 66,028 $ 44,280 Taiwan 67,379 48,728 45,420 China 59,929 34,113 24,753 $ 202,754 $ 148,869 $ 114,453

Q. COMMITMENTS AND CONTINGENC41

Q. COMMITMENTS AND CONTINGENCIES (Tables)	12 Months Ended
	Dec. 31, 2017
Commitments and Contingencies Disclosure [Abstract]
Schedule of future minimum rental commitments	At December 31, 2017, the approximate minimum rental commitments under noncancellable leases in excess of one year that expire at varying dates through 2029 were as follows (in thousands): Year ending December 31, Amount 2018 $ 1,066 2019 1,015 2020 1,007 2021 1,020 2022 1,020 thereafter 6,954 $ 12,082

R. SELECTED QUARTERLY FINANCIAL

R. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (UNAUDITED) (Tables)	12 Months Ended
	Dec. 31, 2017
Quarterly Financial Information Disclosure [Abstract]
Selected Quarterly Financial Data	First Second Third Fourth Year ended December 31, 2017 Quarter Quarter Quarter Quarter Revenue $ 96,224 $ 117,371 $ 88,879 $ 79,855 Cost of goods sold 54,752 64,089 49,507 47,701 Gross profit 41,472 53,282 39,372 32,154 Gross margin Operating expenses: Research and development 7,432 8,073 9,190 10,670 Sales and marketing 1,903 2,158 2,551 2,090 General and administrative 7,822 8,786 9,580 9,074 Total operating expenses 17,157 19,017 21,321 21,834 Income from operations 24,315 34,265 18,051 10,320 Interest and other income (expense), net (872) (111) (541) (901) Net income before taxes 23,443 34,154 17,510 9,419 Income tax (expense) benefit (3,654) (5,083) 1,865 (3,703) Net income $ 19,789 $ 29,071 $ 19,375 $ 5,716 Net income per share—basic $ 1.06 $ 1.52 $ 1.00 $ 0.29 Net income per share—diluted $ 1.00 $ 1.43 $ 0.95 $ 0.28 First Second Third Fourth Year ended December 31, 2016 Quarter Quarter Quarter Quarter Revenue $ 50,422 $ 55,254 $ 70,137 $ 84,900 Cost of goods sold 36,169 37,952 46,976 52,662 Gross profit 14,253 17,302 23,161 32,238 Gross margin Operating expenses: Research and development 8,396 7,814 8,362 7,208 Sales and marketing 1,680 1,610 1,594 1,743 General and administrative 5,733 5,906 6,445 7,443 Total operating expenses 15,809 15,330 16,401 16,394 Income (loss) from operations (1,556) 1,972 6,760 15,844 Interest and other income (expense), net 34 (1,317) (356) (378) Net income (loss) before taxes (1,522) 655 6,404 15,466 Income tax (expense) benefit 192 (52) 11,332 (1,241) Net income (loss) $ (1,330) $ 603 $ 17,736 $ 14,225 Net income (loss) per share—basic $ (0.08) $ 0.04 $ 1.03 $ 0.81 Net income (loss) per share—diluted $ (0.08) $ 0.03 $ 0.97 $ 0.77

A. ORGANIZATION AND OPERATIONS

A. ORGANIZATION AND OPERATIONS (Details)	Dec. 31, 2017item
Accounting Policies [Abstract]
Number of networking end markets	4

B. SUMMARY OF SIGNIFICANT ACC44

B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - PROPERTY, PLANT AND EQUIPMENT (Details)	12 Months Ended
	Dec. 31, 2017
Buildings [Member] | Minimum
Estimated useful lives	20 years
Buildings [Member] | Maximum
Estimated useful lives	42 years
Land improvements
Estimated useful lives	10 years
Machinery and equipment | Minimum
Estimated useful lives	2 years
Machinery and equipment | Maximum
Estimated useful lives	20 years
Furniture and fixtures | Minimum
Estimated useful lives	3 years
Furniture and fixtures | Maximum
Estimated useful lives	7 years
Computer equipment and software | Minimum
Estimated useful lives	3 years
Computer equipment and software | Maximum
Estimated useful lives	10 years
Transportation equipment
Estimated useful lives	5 years

B. SUMMARY OF SIGNIFICANT ACC45

B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - VARIOUS POLICIES (Details)	12 Months Ended
	Dec. 31, 2017USD ($)patent	Dec. 31, 2016USD ($)	Dec. 31, 2015USD ($)
Cash and cash equivalents	$ 82,936,000	$ 50,224,000
Cash in excess of FDIC insurance	58,800,000
Percentage of bank acceptance notes and standy letters of credit	30
Restricted cash	$ 1,012,000	1,732,000
Number of years of land use rights	50 years
Number of patents | patent	241
Weighted average amortization period	8 years
Accrued product warranty	$ 1,118,000	705,000
Advertising Costs	300,000	$ 200,000	$ 100,000
ASU 2016-09
Windfall tax benefits	1,200,000
Retained earnings	$ 10,000
Patents
Weighted average amortization period	20 years
Sales Revenue, Net [Member] | Five Customers [Member]
Concentration of credit risk	86.10%	87.80%	81.80%
Sales Revenue, Net [Member] | Amazon [Member]
Concentration of credit risk	35.40%	54.60%	52.50%
Sales Revenue, Net [Member] | Facebook [Member]
Concentration of credit risk	28.60%
Sales Revenue, Net [Member] | Microsoft [Member]
Concentration of credit risk	13.80%	18.30%	11.60%
Sales Revenue, Net [Member] | Cisco [Member]
Concentration of credit risk			10.40%
Sales Revenue, Net [Member] | Arris [Member]
Concentration of credit risk		5.80%
Accounts Receivable [Member] | Five Customers [Member]
Concentration of credit risk	82.60%	88.30%
Accounts Receivable [Member] | Amazon [Member]
Concentration of credit risk	36.10%	62.10%
Accounts Receivable [Member] | Microsoft [Member]
Concentration of credit risk	19.50%
Accounts Receivable [Member] | Arris [Member]
Concentration of credit risk		10.60%
Foreign Accounts [Member]
Cash and cash equivalents	$ 21,000,000	$ 10,700,000

C. CASH, CASH EQUIVALENTS AND46

C. CASH, CASH EQUIVALENTS AND RESTRICTED CASH (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents Abstract
Cash and cash equivalents	$ 82,936	$ 50,224
Restricted Cash	1,012	1,740
Total cash, cash equivalents and restricted cash shown in the statement of cash flows	$ 83,948	$ 51,964	$ 32,793	$ 32,684

D. EARNINGS PER SHARE (Details)

D. EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Numerator:
Net income	$ 5,716	$ 19,375	$ 29,071	$ 19,789	$ 14,225	$ 17,736	$ 603	$ (1,330)	$ 73,951	$ 31,234	$ 10,793
Weighted average shares used to compute net income per share
Basic									19,097,355	17,201,731	15,626,753
Effective of dilutive options and restricted stock units									1,042,000	511,000	906,000
Diluted									20,139,105	17,712,928	16,532,850
Net income per share
Basic	$ 0.29	$ 1	$ 1.52	$ 1.06	$ 0.81	$ 1.03	$ 0.04	$ (0.08)	$ 3.87	$ 1.82	$ 0.69
Diluted	$ 0.28	$ 0.95	$ 1.43	$ 1	$ 0.77	$ 0.97	$ 0.03	$ (0.08)	$ 3.67	$ 1.76	$ 0.65

E. INVENTORIES (Details)

E. INVENTORIES (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Inventory Disclosure [Abstract]
Raw materials	$ 26,648	$ 21,518
Work in process and sub-assemblies	31,060	24,334
Finished goods	18,060	5,965
Inventories	$ 75,768	$ 51,817

E. INVENTORIES - NARRATIVE (Det

E. INVENTORIES - NARRATIVE (Details) - USD ($) $ in Thousands	Dec. 21, 2017	Dec. 21, 2016	Dec. 21, 2015	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Inventory Disclosure [Abstract]
Lower of cost or market reserve adjustment for inventory				$ 1,900	$ 3,700	$ 2,800
Inventory write-off	$ 6,800	$ 5,000	$ 1,000	$ 1,866	$ 3,707	$ 2,832

F. PROPERTY, PLANT AND EQUIPM50

F. PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Property, plant and equipment, gross	$ 262,213	$ 190,183
Less accumulated depreciation and amortization	(70,194)	(49,175)
Property, plant and equipment after accumulated depreciation and amortization, excluding construction in progress and land	192,019	141,008
Construction in progress	4,823	1,989
Land	1,101	1,101
Property, plant and equipment, net	197,943	144,098
Land improvements
Property, plant and equipment, gross	806	792
Building and improvements
Property, plant and equipment, gross	78,785	69,368
Machinery and equipment
Property, plant and equipment, gross	168,993	108,724
Furniture and fixtures
Property, plant and equipment, gross	4,663	4,227
Computer equipment and software
Property, plant and equipment, gross	8,248	6,836
Transportation equipment
Property, plant and equipment, gross	$ 718	$ 236

F. PROPERTY, PLANT AND EQUIPM51

F. PROPERTY, PLANT AND EQUIPMENT - NARRATIVE (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 19.9	$ 13.7	$ 9

G. INTANGIBLE ASSETS (Details)

G. INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Gross Amount	$ 6,538	$ 6,001
Accumulated amortization	(2,531)	(2,008)
Intangible assets, net	4,007	3,993
Patents
Gross Amount	6,524	5,987
Accumulated amortization	(2,519)	(1,997)
Intangible assets, net	4,005	3,990
Trademarks
Gross Amount	14	14
Accumulated amortization	(12)	(11)
Intangible assets, net	$ 2	$ 3

G. INTANGIBLE ASSETS - AMORTIZA

G. INTANGIBLE ASSETS - AMORTIZATION SCHEDULE (Details) $ in Thousands	Dec. 31, 2017USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2,018	$ 485
2,019	485
2,020	485
2,021	486
2,022	486
Thereafter	1,580
Amortization expense for intangible assets	$ 4,007

G. INTANGIBLE ASSETS - NARRATIV

G. INTANGIBLE ASSETS - NARRATIVE (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense for intangible assets	$ 0.5	$ 0.5	$ 0.4
Weighted average amortization period	8 years

H. FAIR VALUE OF FINANCIAL IN55

H. FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Assets:
Cash and cash equivalents	$ 82,936	$ 50,224
Restricted cash	1,012	1,740
Short term investments	36	44
Total assets	83,984	52,008
Liabilities:
Bank acceptance payable		307
Total liabilities		307
Level 1 | Fair Value, Measurements, Recurring
Assets:
Cash and cash equivalents	82,936	50,224
Restricted cash	1,012	1,740
Short term investments	36	44
Total assets	$ 83,984	52,008
Level 2 | Fair Value, Measurements, Recurring
Liabilities:
Bank acceptance payable		307
Total liabilities		$ 307

I. NOTES PAYABLE AND LONG-TER56

I. NOTES PAYABLE AND LONG-TERM DEBT (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Notes payable and long-term debt	$ 49,559	$ 42,826
Current portion of notes payable and long-term debt	(559)	(7,865)
Long term portion of notes payable and long-term debt	$ 49,000	34,961
Bank acceptance notes		$ 307
London Interbank Offered Rate (LIBOR)
Basis spread on variable rate	1.56425%	0.77167%
Term loan 1
Notes payable and long-term debt		$ 2,925
Term loan 1 | London Interbank Offered Rate (LIBOR)
Basis spread on variable rate	2.00%
Term loan 2
Notes payable and long-term debt		9,500
Term loan 2 | London Interbank Offered Rate (LIBOR)
Basis spread on variable rate	2.00%
Term loan 3
Notes payable and long-term debt		21,670
Term loan 3 | London Interbank Offered Rate (LIBOR)
Basis spread on variable rate	2.00%
Note payable 1
Notes payable and long-term debt	$ 559	2,919
Stated interest rate	4.50%
Debt maturity date	May 27, 2018
Note payable 2
Notes payable and long-term debt		$ 5,812
Stated interest rate	4.00%
Debt maturity date	Mar. 31, 2019
Bank Acceptance Notes Payable
Stated interest rate	0.00%
Revolving Line of Credit | Revolving Line of Credit 1
Notes payable and long-term debt	$ 49,000
Revolving line of credit maximum borrowing capacity	$ 50,000
Debt maturity date	Sep. 28, 2020
Revolving Line of Credit | Revolving Line of Credit 1 | London Interbank Offered Rate (LIBOR)
Basis spread on variable rate	1.50%

I. NOTES PAYABLE AND LONG-TER57

I. NOTES PAYABLE AND LONG-TERM DEBT - Debt Maturities (Details) $ in Thousands	Dec. 31, 2017USD ($)
Maturities of notes payable and long-term debt
2,018	$ 559
2,020	49,000
Total outstanding	$ 49,559

I. NOTES PAYABLE AND LONG-TER58

I. NOTES PAYABLE AND LONG-TERM DEBT - Term Debt - Narrative2 (Details) $ in Thousands

Sep. 28, 2017USD ($)

Feb. 27, 2017USD ($)

Oct. 05, 2016

Jun. 25, 2016USD ($)

Jun. 24, 2016USD ($)

Jun. 14, 2016

Mar. 31, 2016TWD

Mar. 31, 2016USD ($)

May 27, 2015TWD

May 27, 2015USD ($)

Dec. 31, 2017USD ($)

Dec. 31, 2016USD ($)

Dec. 31, 2015USD ($)

Restricted Cash and Cash Equivalents, Current

$ 1,012

$ 1,732

Repayments of outstanding balance

$ 11,200

39,003

163,068

$ 121,386

Notes payable and long-term debt

49,559

42,826

Bank acceptance notes outstanding

307

Unused borrowing capacity

1,000

75,800

Restricted cash, investments or security deposit associated with loan facilities

$ 1,000

$ 1,700

London Interbank Offered Rate (LIBOR)

Basis spread on variable rate

1.56425%

0.77167%

Letter of Credit

Revolving line of credit maximum borrowing capacity

$ 10,000

East West Bank and Comerica Bank | Construction Loan 1

Term of revolving credit facility

64 months

East West Bank and Comerica Bank | Modification Agreement

Draw down period

15 months

Term of revolving credit facility

66 months

Amortization Period

300 months

East West Bank and Comerica Bank | London Interbank Offered Rate (LIBOR) | Modification Agreement

Interest rate description

LIBOR Borrowing Rate plus 2.0%

Basis spread on variable rate

2.00%

East West Bank and Comerica Bank | One Month LIBOR Rate | Modification Agreement

Interest rate description

one-month LIBOR Borrowing Rate plus 2.75%

Basis spread on variable rate

2.75%

East West Bank and Comerica Bank | Term Loan

Revolving line of credit maximum borrowing capacity

$ 5,000

Repayments of outstanding balance

$ 2,800

Revolving line of credit, maturity date

Jul. 31, 2019

East West Bank | Modification Agreement

Revolving line of credit maximum borrowing capacity

$ 22,000

Restricted Cash and Cash Equivalents, Current

11,000

China Construction Bank

Revolving line of credit maximum borrowing capacity

13,200

Chailease Finance Co. Ltd. | Finance Lease 1

Note payable

600

Lease purchase price

TWD 180,148,532

$ 6,000

Initial payment amount

TWD 60,148,532

$ 2,000

Financial lease term

3 years

3 years

Chailease Finance Co. Ltd. | Finance Lease 1 | Minimum

Lease payment range price

TWD 3,322,413

$ 100

Chailease Finance Co. Ltd. | Finance Lease 1 | Maximum

Lease payment range price

TWD 3,784,000

$ 100

Chailease Finance Co. Ltd. | Finance Lease 2

Lease purchase price

TWD 312,927,180

$ 10,100

Financial lease term

3 years

3 years

Financial lease Interest rate

4.00%

4.00%

Chailease Finance Co. Ltd. | Finance Lease 2 | Minimum

Initial payment amount | TWD

TWD 62,927,180

Lease payment range price

6,772,500

$ 200

Chailease Finance Co. Ltd. | Finance Lease 2 | Maximum

Initial payment amount

2,000

Lease payment range price

TWD 7,788,333

$ 300

Branch Banking and Trust Company | One Month LIBOR Rate

Basis spread on variable rate

1.50%

Branch Banking and Trust Company | First Credit Facility

Revolving line of credit maximum borrowing capacity

$ 50,000

Notes payable and long-term debt

$ 49,000

Term of loan

3 years

Revolving Line of Credit | East West Bank and Comerica Bank | First Amendment

Revolving line of credit maximum borrowing capacity

$ 40,000

$ 25,000

Term of revolving credit facility

5 years

Draw down period

1 year

Revolving Line of Credit | East West Bank and Comerica Bank | First Amendment | London Interbank Offered Rate (LIBOR)

Interest rate description

LIBOR Borrowing Rate plus 2.0%.

LIBOR Borrowing Rate plus 2.75% or 3.0%

Revolving Line of Credit | East West Bank and Comerica Bank | First Amendment | London Interbank Offered Rate (LIBOR) | Minimum

Basis spread on variable rate

2.75%

Revolving Line of Credit | East West Bank and Comerica Bank | First Amendment | London Interbank Offered Rate (LIBOR) | Maximum

Basis spread on variable rate

3.00%

Term Loan | East West Bank and Comerica Bank | First Amendment

Revolving line of credit maximum borrowing capacity

$ 10,000

Equipment Term Loan | East West Bank and Comerica Bank | First Amendment

Revolving line of credit maximum borrowing capacity

$ 10,000

J. ACCRUED LIABILITIES (Details

J. ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Payables and Accruals [Abstract]
Accrued payroll	$ 11,693	$ 9,231
Accrued rent	1,180	959
Accrued employee benefits	2,035	1,572
Accrued state and local taxes	951	607
Advance payments	441	252
Accrued product warranty	1,118	705
Accrued commission expenses	425	205
Accrued professional fees	181	163
Accrued other	1,079	758
Total accrued liabilities	$ 19,103	$ 14,452

K. OTHER INCOME AND EXPENSE (De

K. OTHER INCOME AND EXPENSE (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Other income (expense)
Foreign exchange transaction loss	$ (2,012)	$ (617)	$ (1,847)
Government subsidy income	211	164	217
Other non-operating gain	110	32	117
Loss on disposal of assets	(97)	(126)	(78)
Other income and expense, net	$ (1,788)	$ (547)	$ (1,591)

L. INCOME TAXES - OPERATIONS IN

L. INCOME TAXES - OPERATIONS INCOME (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Domestic									$ 17,497	$ 10,047	$ 14,062
Foreign									67,029	10,956	(2,894)
Income before income taxes	$ 9,419	$ 17,510	$ 34,154	$ 23,443	$ 15,466	$ 6,404	$ 655	$ (1,522)	$ 84,526	$ 21,003	$ 11,168

L. INCOME TAXES - PROVISION FOR

L. INCOME TAXES - PROVISION FOR INCOME TAX EXPENSE (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Current:
Federal										$ (15)	$ 168
State									$ (292)	256	207
Foreign									10,965	962
Total									10,673	1,203	375
Deferred:
Federal									2,015	(10,794)
State									(1,669)	(130)
Foreign									(444)	(510)
Total									(98)	(11,434)
Tax (benefit) expense	$ 3,703	$ (1,865)	$ 5,083	$ 3,654	$ 1,241	$ (11,332)	$ 52	$ (192)	$ 10,575	$ (10,231)	$ 375

L. INCOME TAXES - DEFERRED INCO

L. INCOME TAXES - DEFERRED INCOME TAXES (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Income Tax Disclosure [Abstract]
NOL Carryforward	$ 7,739	$ 12,866
Inventory reserves	837	869
AMT credit	345	424
Unrealized gains and losses	92
Unrealized loss		(6)
Share-based compensation	732	1,453
Foreign tax credit	2,018
Research and development credits	4,626
Other	573	255
Subtotal	16,962	15,861
Less valuation allowance		(1,663)
Deferred tax assets, net	16,962	14,198
Depreciation and amortization	(4,161)	(2,777)
Deferred tax liabilities	(4,161)	(2,777)
Deferred tax assets, net	$ 12,801	$ 11,421

L. INCOME TAXES - RECONCILIATIO

L. INCOME TAXES - RECONCILIATION (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Expected (benefit) taxes									$ 29,584	$ 7,351	$ 3,797
Non-deductible/non-taxable items									1,212	565	157
Foreign rate differences									(11,656)	(654)	(1,267)
Foreign permanent differences									416	(1,005)
Increase (decrease) in valuation allowance									(1,700)	(13,063)	2,052
Share based compensation									(10,348)
Section 382 limitation										(3,065)	(4,382)
Changes in tax laws or rates									2,768	(361)
Repatriation tax, net of foreign tax credit									5,067
Research and development credits									(2,821)
Uncertain tax positions									(1,616)
Other, net									(331)	1	18
Tax (benefit) expense	$ 3,703	$ (1,865)	$ 5,083	$ 3,654	$ 1,241	$ (11,332)	$ 52	$ (192)	$ 10,575	$ (10,231)	$ 375

L. INCOME TAXES - UNRECOGNIZED

L. INCOME TAXES - UNRECOGNIZED TAX BENEFIT (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Unrecognized tax benefits - January 1	$ 1,797	$ 1,659
Gross increases - tax positions in prior period		332
Gross decreases - tax positions in prior period	1,616	194
Unrecognized tax benefits - December 31	181	$ 1,797
Increase in deferred tax assets	$ 1,600

L. INCOME TAXES - NARRATIVE (De

L. INCOME TAXES - NARRATIVE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Valuation allowance increase (decrease)			$ 1,700	$ 13,100
Valuation allowance				1,663
Net operating loss carryforward	$ 37,700		$ 37,700
Loss carryforward expiration date			Dec. 31, 2032
Foreign tax credit	2,018		$ 2,018
Research and development tax credits	4,600		$ 4,600
Research and development tax credit expiration date			Dec. 31, 2037
Federal income tax rate			35.00%
China income tax rate			25.00%
Reduction in income tax provision due to tax holiday			$ 1,400
Increase in diluted earnings per share due to tax holiday			$ 0.07
Unrecognized tax benefits	181		$ 181	1,797	$ 1,797	$ 1,659
Accrued penalties or interest				$ 0
Impact on change in tax rate			2,800
Impact on deferred tax assets due to change in tax rate			2,800
Repatriation tax			5,000
Income tax			9,000
Foreign tax credits			4,000
Reduction to net deferred tax assets attributable to accelerated depreciation	700
Forecast
Federal income tax rate		21.00%
ASU 2016-09
Deferred tax asset, changes in accounting standard	1,200		1,200
Credit to retained earnings	1,200		$ 1,200
Foreign tax credits
Loss carryforward expiration date			Dec. 31, 2037
Foreign tax credit	$ 2,000		$ 2,000
Global [Member]
China income tax rate			15.00%
Tax rate effective period			3 years
Extended period of tax preferential status			3 years

M. SHARE-BASED COMPENSATION - O

M. SHARE-BASED COMPENSATION - OPTION ACTIVITY (Details) - Employee Stock Option - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Number of Shares
Outstanding, beginning balance	1,130	1,310	1,423
Exercised	(418)	(159)	(81)
Forfeited	(176)	(21)	(32)
Outstanding, ending balance	536	1,130	1,310
Exercisable, ending balance	525
Vested and expected to vest	536
Weighted Average Exercise Price
Outstanding, beginning balance	$ 9.40	$ 9.07	$ 8.96
Exercised	8.56	6.91	7.09
Forfeited	9.42	7.96	8.96
Outstanding, ending balance	10.04	9.40	9.07
Exercisable, ending balance	9.96
Vested and expected to vest	10.04
Weighted Average Share Price on Date of Exercise	59.31	19.90	16.53
Weighted Average Fair Value [Abstract]
Outstanding, beginning balance	4.90	4.59	4.48
Exercised	4.51	2.56	2.62
Forfeited	4.97	3.29	4.43
Outstanding, ending balance	$ 5.19	$ 4.90	$ 4.59
Weighted Average Remaining Contractual Life
Outstanding, ending balance	5 years 7 months 13 days
Exercisable, ending balance	5 years 7 months 10 days
Vested and expected to vest	5 years 7 months 13 days
Aggregate Intrinsic Value
Aggregate intrinsic value, beginning balance	$ 15,872	$ 10,598	$ 3,486
Exercised	21,224	2,071	762
Forfeited	4,998	273	212
Aggregate intrinsic value, ending balance	14,888	$ 15,872	$ 10,598
Exercisable, ending balance	12,499
Vested and expected to vest	$ 14,888

M. SHARE-BASED COMPENSATION - R

M. SHARE-BASED COMPENSATION - RESTRICTED STOCK UNITS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Maximum
Vesting period	10 years
Restricted stock units
Number of shares
Outstanding, beginning balance	517	152	21
Granted	510	497	156
Released	(289)	(122)	(19)
Cancelled/Forfeited	(31)	(10)	(6)
Outstanding, ending balance	707	517	152
Exercisable, ending balance	4
Vested and expected to vest	703
Weighted Average Share Price On Date Of Granted		$ 13.50	$ 13.62
Weighted Average Share Price on Date of Release	$ 60.87
Weighted Average Fair Value
Outstanding, beginning balance	14.79	11.20	18.22
Granted	38.87	15.73	11.06
Released	20.92	14.09	18.24
Cancelled/Forfeited	24.23	15.38	10
Outstanding, ending balance	$ 29.23	$ 14.79	$ 11.20
Aggregate Intrinsic Value [Abstract]
Aggregate intrinsic value, outstanding	$ 12,128	$ 2,611	$ 238
Granted	19,803	7,815	1,722
Released	17,579	1,644	257
Cancelled/Forfeited	1,181	180	99
Aggregate intrinsic value, outstanding	26,732	$ 12,128	$ 2,611
Exercisable, ending balance	140
Vested and expected to vest	$ 26,592

M. SHARE-BASED COMPENSATION - S

M. SHARE-BASED COMPENSATION - SHARE-BASED COMPENSATION EXPENSE (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Total share-based compensation expense	$ 7,795	$ 3,833	$ 2,120
Employee Stock Option
Total share-based compensation expense	853	1,460	1,538
Restricted stock units
Total share-based compensation expense	6,942	2,373	582
Cost of sales [Member]
Total share-based compensation expense	461	190	70
Research and development [Member]
Total share-based compensation expense	1,496	591	230
Sales and marketing [Member]
Total share-based compensation expense	481	357	217
General and administrative [Member]
Total share-based compensation expense	$ 5,357	$ 2,695	$ 1,603

M. SHARE-BASED COMPENSATION - N

M. SHARE-BASED COMPENSATION - NARRATIVE (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2017USD ($)plan	Dec. 31, 2016USD ($)	Dec. 31, 2015USD ($)	Dec. 31, 2014USD ($)
Number of incentive plans | plan	5
Options exercisable (as a percent)	25.00%
Options Expiration Period	10 years
Unrecognized compensation expense	$ 12,000
Unrecognized compensation expense recognized period	29 days
Minimum
Vesting period	4 years
Maximum
Vesting period	10 years
Restricted stock units
Unrecognized compensation expense	$ 18,800
Unrecognized compensation expense recognized period	2 years 9 months 26 days
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Outstanding	$ 26,732	$ 12,128	$ 2,611	$ 238

N. STOCKHOLDERS'S EQUITY - NARR

N. STOCKHOLDERS'S EQUITY - NARRATIVE (Details) - USD ($) $ / shares in Units, $ in Thousands	Oct. 17, 2016	Jun. 03, 2015	Mar. 31, 2017	Aug. 31, 2015	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2017	Nov. 30, 2015
Common stock shares authorized					45,000,000	45,000,000		45,000,000
Preferred Stock shares authorized					5,000,000	5,000,000		5,000,000
Warrants outstanding					$ 0			$ 0
Public offering of common stock, net of value					21,572	$ 27,237	$ 38,648
Additional paid in capital									$ 6,000
Aggregate share price		$ 140,000
Proceeds from common share					$ 21,572	$ 27,237	$ 38,648
ATM Offering [Member]
Public offering of common stock, net, in shares				1,900,000
Public offering of common stock, net of value				$ 38,600
Weighted average price per share				$ 21.54
Second ATM Offering [Member]
Public offering of common stock, net, in shares			1,600,000
Public offering of common stock, net of value	$ 250,000
Weighted average price per share			$ 31.55
Proceeds from common share			$ 48,800
Raymond James & Associates [Member] | ATM Offering [Member]
Aggregate share price								$ 40,000
Raymond James & Associates [Member] | Second ATM Offering [Member]
Public offering of common stock, net of value	$ 50,000

O. SEGMENT AND GEOGRAPHIC INF72

O. SEGMENT AND GEOGRAPHIC INFORMATION - REVENUES (Details) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017USD ($)	Sep. 30, 2017USD ($)	Jun. 30, 2017USD ($)	Mar. 31, 2017USD ($)	Dec. 31, 2016USD ($)	Sep. 30, 2016USD ($)	Jun. 30, 2016USD ($)	Mar. 31, 2016USD ($)	Dec. 31, 2017USD ($)item	Dec. 31, 2016USD ($)	Dec. 31, 2015USD ($)
Number of Reportable segment | item									1
Revenues	$ 79,855	$ 88,879	$ 117,371	$ 96,224	$ 84,900	$ 70,137	$ 55,254	$ 50,422	$ 382,329	$ 260,713	$ 189,903
UNITED STATES
Revenues									18,209	18,035	16,766
TAIWAN, PROVINCE OF CHINA
Revenues									241,820	161,611	141,107
CHINA
Revenues									$ 122,300	$ 81,067	$ 32,030

O. SEGMENT AND GEOGRAPHIC INF73

O. SEGMENT AND GEOGRAPHIC INFORMATION - LONG LIVED ASSETS (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Long-lived assets	$ 202,754	$ 148,869	$ 114,453
UNITED STATES
Long-lived assets	75,446	66,028	44,280
TAIWAN, PROVINCE OF CHINA
Long-lived assets	67,379	48,728	45,420
CHINA
Long-lived assets	$ 59,929	$ 34,113	$ 24,753

O. SEGMENT AND GEOGRAPHIC INF74

O. SEGMENT AND GEOGRAPHIC INFORMATION - NARRATIVE (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenues	$ 79,855	$ 88,879	$ 117,371	$ 96,224	$ 84,900	$ 70,137	$ 55,254	$ 50,422	$ 382,329	$ 260,713	$ 189,903
Internet data center [Member] | Sales Revenue, Net [Member]
Revenues									$ 306,700	$ 201,300	$ 123,200
Concentration percentage									80.20%	77.20%	64.90%
CATV markets [Member] | Sales Revenue, Net [Member]
Revenues									$ 60,800	$ 43,600	$ 53,700
Concentration percentage									15.90%	16.70%	28.30%
FTTH markets [Member] | Sales Revenue, Net [Member]
Revenues									$ 500	$ 1,600	$ 2,500
Concentration percentage									0.10%	0.60%	1.30%
Telecom markets [Member] | Sales Revenue, Net [Member]
Revenues									$ 12,900	$ 12,900	$ 9,700
Concentration percentage									3.40%	5.00%	5.10%

P. EMPLOYEE BENEFIT PLANS - NAR

P. EMPLOYEE BENEFIT PLANS - NARRATIVE (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Pension expense	$ 0.9	$ 0.8	$ 0.6
Company contributions for 401(k)	0.6	0.6	0.4
Global [Member]
Pension expense	$ 0.8	$ 0.6	$ 0.3

Q. COMMITMENTS AND CONTINGENC76

Q. COMMITMENTS AND CONTINGENCIES (Details) $ in Millions	Dec. 31, 2017USD ($)
Commitments and Contingencies Disclosure [Abstract]
2,018	$ 1,066
2,019	1,015
2,020	1,007
2,021	1,020
thereafter	6,954
Total future rental commitment	$ 12,082

Q. COMMITMENTS AND CONTINGENC77

Q. COMMITMENTS AND CONTINGENCIES - NARRATIVE (Details) $ in Millions	12 Months Ended
	Dec. 31, 2017USD ($)individual	Dec. 31, 2016USD ($)	Dec. 31, 2015USD ($)
Commitments and Contingencies Disclosure [Abstract]
Rent expense	$ 1.1	$ 1.1	$ 1.1
Lease fee	5
lease fee paid	1.1
lease commitment due for next year	$ 3.9
Number of executive officers | individual	3

R. SUBSEQUENT EVENTS - NARRATIV

R. SUBSEQUENT EVENTS - NARRATIVE (Details) $ in Thousands, ¥ in Millions	Feb. 08, 2018CNY (¥)ft²	Feb. 08, 2018USD ($)ft²	Jan. 08, 2018USD ($)	Sep. 28, 2017USD ($)	Dec. 31, 2017USD ($)	Dec. 31, 2016USD ($)	Dec. 31, 2015USD ($)
Repayment of revolving bank line of credit				$ 11,200	$ 39,003	$ 163,068	$ 121,386
Subsequent Event [Member]
Repayment of revolving bank line of credit			$ 49,000
Subsequent Event [Member] | Zhejiang Xinyu Construction Group Co. Ltd
Amount of construction agreement	¥ 187.8	$ 30,300
Number of square feet | ft²	744,000	744,000

S. SELECTED QUARTERLY FINANCI79

S. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Quarterly Financial Information Disclosure [Abstract]
Revenue	$ 79,855	$ 88,879	$ 117,371	$ 96,224	$ 84,900	$ 70,137	$ 55,254	$ 50,422	$ 382,329	$ 260,713	$ 189,903
Cost of goods sold	47,701	49,507	64,089	54,752	52,662	46,976	37,952	36,169	216,049	173,759	129,450
Gross Profit	$ 32,154	$ 39,372	$ 53,282	$ 41,472	$ 32,238	$ 23,161	$ 17,302	$ 14,253	166,280	86,954	60,453
Gross margin	40.30%	44.30%	45.40%	43.10%	38.00%	33.00%	31.30%	28.30%
Operating expenses:
Research and development	$ 10,670	$ 9,190	$ 8,073	$ 7,432	$ 7,208	$ 8,362	$ 7,814	$ 8,396	35,365	31,780	20,852
Sales and marketing	2,090	2,551	2,158	1,903	1,743	1,594	1,610	1,680	8,702	6,627	6,381
General and administrative	9,074	9,580	8,786	7,822	7,443	6,445	5,906	5,733	35,262	25,527	19,771
Total operating expenses	21,834	21,321	19,017	17,157	16,394	16,401	15,330	15,809	79,329	63,934	47,004
Income (loss) from operations	10,320	18,051	34,265	24,315	15,844	6,760	1,972	(1,556)	86,951	23,020	13,449
Interest and other income (expense), net	(901)	(541)	(111)	(872)	(378)	(356)	(1,317)	34	(2,425)	(2,017)	(2,281)
Income before income taxes	9,419	17,510	34,154	23,443	15,466	6,404	655	(1,522)	84,526	21,003	11,168
Income tax (expense) benefit	(3,703)	1,865	(5,083)	(3,654)	(1,241)	11,332	(52)	192	(10,575)	10,231	(375)
Net income (loss)	$ 5,716	$ 19,375	$ 29,071	$ 19,789	$ 14,225	$ 17,736	$ 603	$ (1,330)	$ 73,951	$ 31,234	$ 10,793
Net income per share basic	$ 0.29	$ 1	$ 1.52	$ 1.06	$ 0.81	$ 1.03	$ 0.04	$ (0.08)	$ 3.87	$ 1.82	$ 0.69
Net income per share diluted	$ 0.28	$ 0.95	$ 1.43	$ 1	$ 0.77	$ 0.97	$ 0.03	$ (0.08)	$ 3.67	$ 1.76	$ 0.65