Document_And_Entity_Informatio
Document And Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Oct. 31, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'INPHI CORP | ' |
Document Type | '10-Q | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Common Stock, Shares Outstanding | ' | 37,101,675 |
Amendment Flag | 'false | ' |
Entity Central Index Key | '0001160958 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Unaudited_Condensed_Consolidat
Unaudited Condensed Consolidated Balance Sheets (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $79,612 | $31,667 |
Investments in marketable securities | 39,550 | 90,890 |
Accounts receivable, net | 22,454 | 13,073 |
Inventories | 9,208 | 6,767 |
Deferred tax asset | 907 | 1,099 |
Income tax receivable | 199 | 240 |
Prepaid expenses and other current assets | 3,256 | 2,361 |
Total current assets | 155,186 | 146,097 |
Property and equipment, net | 31,372 | 22,460 |
Goodwill | 5,875 | 5,875 |
Deferred tax charge | 3,496 | 4,200 |
Other assets, net | 5,362 | 3,710 |
Total assets | 201,291 | 182,342 |
Current liabilities: | ' | ' |
Accounts payable | 10,787 | 7,280 |
Deferred revenue | 3,349 | 1,686 |
Accrued employee expenses | 5,501 | 4,626 |
Other accrued expenses | 2,631 | 1,611 |
Other current liabilities | 705 | 1,881 |
Total current liabilities | 22,973 | 17,084 |
Other long-term liabilities | 6,124 | 5,865 |
Total liabilities | 29,097 | 22,949 |
Stockholders’ equity: | ' | ' |
Preferred stock, $0.001 par value; 10,000,000 shares authorized; no shares issued | 0 | 0 |
Common stock, $0.001 par value; 500,000,000 shares authorized; 31,764,498 and 30,244,439 issued and outstanding at September 30, 2014 and December 31, 2013, respectively | 32 | 30 |
Additional paid-in capital | 243,096 | 225,007 |
Accumulated deficit | -71,800 | -66,582 |
Accumulated other comprehensive income | 866 | 938 |
Total stockholders’ equity | 172,194 | 159,393 |
Total liabilities and stockholders’ equity | $201,291 | $182,342 |
Unaudited_Condensed_Consolidat1
Unaudited Condensed Consolidated Balance Sheets (Parentheticals) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Preferred stock, par value (in Dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in Dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 31,764,498 | 30,244,439 |
Common stock, outstanding | 31,764,498 | 30,244,439 |
Unaudited_Condensed_Consolidat2
Unaudited Condensed Consolidated Statements of Income (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Revenue | $36,278 | $26,611 | $101,389 | $73,534 |
Cost of revenue | 13,003 | 9,796 | 36,362 | 26,981 |
Gross profit | 23,275 | 16,815 | 65,027 | 46,553 |
Research and development | 15,795 | 12,995 | 45,263 | 37,389 |
Sales and marketing | 4,828 | 4,118 | 13,140 | 11,771 |
General and administrative | 4,671 | 2,779 | 10,970 | 8,776 |
Total operating expenses | 25,294 | 19,892 | 69,373 | 57,936 |
Loss from operations | -2,019 | -3,077 | -4,346 | -11,383 |
Other income | 245 | 210 | 577 | 636 |
Loss before income taxes | -1,774 | -2,867 | -3,769 | -10,747 |
Provision (benefit) for income taxes | 5,083 | -107 | 1,449 | 1,158 |
Net loss | ($6,857) | ($2,760) | ($5,218) | ($11,905) |
Earnings per share: | ' | ' | ' | ' |
Basic (in Dollars per share) | ($0.22) | ($0.09) | ($0.17) | ($0.41) |
Diluted (in Dollars per share) | ($0.22) | ($0.09) | ($0.17) | ($0.41) |
Weighted-average shares used in computing earnings per share: | ' | ' | ' | ' |
Basic (in Shares) | 31,655,211 | 29,639,650 | 31,247,483 | 29,265,619 |
Diluted (in Shares) | 31,655,211 | 29,639,650 | 31,247,483 | 29,265,619 |
Unaudited_Condensed_Consolidat3
Unaudited Condensed Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Net loss | ($6,857) | ($2,760) | ($5,218) | ($11,905) |
Other comprehensive income (loss): | ' | ' | ' | ' |
Change in unrealized gain, net of tax | -58 | 17 | 23 | -153 |
Realized loss (gain) reclassified into earnings, net of tax | -95 | -5 | -95 | -42 |
Comprehensive loss | ($7,010) | ($2,748) | ($5,290) | ($12,100) |
Unaudited_Condensed_Consolidat4
Unaudited Condensed Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Cash flows from operating activities | ' | ' |
Net loss | ($5,218) | ($11,905) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 7,943 | 5,525 |
Stock-based compensation | 15,966 | 13,000 |
Deferred income taxes and deferred tax charge | 677 | 641 |
Excess tax benefit related to stock-based compensation | -777 | -120 |
Amortization of premium on marketable securities | 666 | 743 |
Other noncash items | 49 | -40 |
Changes in assets and liabilities: | ' | ' |
Accounts receivable | -9,381 | 894 |
Inventories | -2,441 | -601 |
Prepaid expenses and other assets | -1,794 | -128 |
Income tax payable/receivable | 825 | 2,460 |
Accounts payable | 136 | 505 |
Accrued expenses | 1,450 | -130 |
Deferred revenue | 1,663 | 497 |
Other liabilities | -732 | -106 |
Net cash provided by operating activities | 9,032 | 11,235 |
Cash flows from investing activities | ' | ' |
Purchases of property and equipment | -12,987 | -12,521 |
Purchases of marketable securities | -37,006 | -32,122 |
Sales and maturities of marketable securities | 87,860 | 30,950 |
Purchase of intangible assets | -1,079 | ' |
Purchase of noncurrent investment | ' | -2,621 |
Net cash provided by (used in) investing activities | 36,788 | -16,314 |
Cash flows from financing activities | ' | ' |
Proceeds from exercise of stock options | 2,961 | 2,194 |
Excess tax benefit related to stock-based compensation | 777 | 120 |
Minimum tax withholding paid on behalf of employees for restricted stock units | -4,282 | -1,772 |
Proceeds from employee stock purchase plan | 2,669 | 2,221 |
Net cash provided by financing activities | 2,125 | 2,763 |
Net increase (decrease) in cash and cash equivalents | 47,945 | -2,316 |
Cash and cash equivalents at beginning of period | 31,667 | 30,161 |
Cash and cash equivalents at end of period | $79,612 | $27,845 |
Note_1_Organization_and_Basis_
Note 1 - Organization and Basis of Presentation | 9 Months Ended |
Sep. 30, 2014 | |
Disclosure Text Block [Abstract] | ' |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | ' |
1. Organization and Basis of Presentation | |
Inphi Corporation (the “Company”), a Delaware corporation, was incorporated in November 2000. The Company is a fabless provider of high-speed analog and mixed signal semiconductor solutions for the communications, data center and computing markets. The Company’s semiconductor solutions are designed to address bandwidth bottlenecks in networks, maximize throughput and minimize latency in computing environments and enable the rollout of next generation communications, data center and computing infrastructures. In addition, the semiconductor solutions provide a vital high-speed interface between analog signals and digital information in high-performance systems such as telecommunications transport systems, enterprise networking equipment, data center and enterprise servers, storage platforms, test and measurement equipment and military systems. | |
The interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”), Form 10-Q and Article 10 of SEC Regulation S-X. They do not include all of the information and footnotes required by GAAP for complete financial statements. Therefore, these financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2013, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 5, 2014. | |
The interim condensed consolidated financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to state fairly the Company’s consolidated financial position at September 30, 2014, and its consolidated results of operations for the three and nine months ended September 30, 2014 and 2013 and cash flows for the nine months ended September 30, 2014 and 2013. The results of operations for the three and nine months ended September 30, 2014 are not necessarily indicative of the results to be expected for future quarters or the full year. |
Note_2_Recent_Accounting_Prono
Note 2 - Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2014 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | ' |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | ' |
2. Recent Accounting Pronouncements | |
In January 2014, the Company adopted the guidance on the “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” The guidance provides that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The assessment of whether a deferred tax asset is available is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. The amendments in this update do not require new recurring disclosures. The adoption of this guidance had no impact on the Company’s financial statements. | |
In May 2014, the Financial Accounting Standards Board issued guidance on “Revenue from Contracts with Customers.” The new revenue recognition guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. The guidance requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The new guidance is effective for the Company on January 1, 2017. Early application is not permitted. The new guidance permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that the new revenue recognition guidance will have on the consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor determined the effect of the standard on the ongoing financial reporting. |
Note_3_Investments
Note 3 - Investments | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Investments Schedule [Abstract] | ' | ||||||||||||||||
Investment [Text Block] | ' | ||||||||||||||||
3. Investments | |||||||||||||||||
The following table summarizes the investments by investment category: | |||||||||||||||||
30-Sep-14 | 31-Dec-13 | ||||||||||||||||
Cost | Fair Value | Cost | Fair Value | ||||||||||||||
Available-for-sale securities: | |||||||||||||||||
US treasury securities | $ | 2,810 | $ | 2,813 | $ | 25,061 | $ | 25,072 | |||||||||
Municipal bonds | 18,994 | 19,044 | 34,912 | 34,983 | |||||||||||||
Corporate notes/bonds | 17,652 | 17,693 | 28,565 | 28,648 | |||||||||||||
Certificate of deposit | — | — | 1,500 | 1,501 | |||||||||||||
Asset backed securities | — | — | 685 | 686 | |||||||||||||
Total investments | $ | 39,456 | $ | 39,550 | $ | 90,723 | $ | 90,890 | |||||||||
As of September 30, 2014, we had 14 investments that were in an unrealized loss position. The gross unrealized losses on these investments at September 30, 2014 of $26 were determined to be temporary in nature. The Company reviews the investments to identify and evaluate investments that have an indication of possible other-than-temporary impairment. Factors considered in determining whether a loss is other-than-temporary include the length of time and extent to which fair value has been less than the cost basis, the financial condition and near-term prospects of the investee, and the intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value. | |||||||||||||||||
The realized gain related to the Company’s available-for-sale investment which was reclassified from other comprehensive income was included in other income in the consolidated statements of income. | |||||||||||||||||
The contractual maturities of available-for-sale securities at September 30, 2014 are presented in the following table: | |||||||||||||||||
Cost | Fair Value | ||||||||||||||||
Due in one year or less | $ | 12,624 | $ | 12,678 | |||||||||||||
Due between one and five years | 26,832 | 26,872 | |||||||||||||||
$ | 39,456 | $ | 39,550 | ||||||||||||||
Note_4_Inventories
Note 4 - Inventories | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Inventory Disclosure [Text Block] | ' | ||||||||
4. Inventories | |||||||||
Inventories consist of the following: | |||||||||
September 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Raw materials | $ | 1,316 | $ | 670 | |||||
Work in process | 2,207 | 2,001 | |||||||
Finished goods | 5,685 | 4,096 | |||||||
$ | 9,208 | $ | 6,767 | ||||||
Finished goods held by distributors were $1,704 and $543 as of September 30, 2014 and December 31, 2013, respectively. |
Note_5_Property_and_Equipment_
Note 5 - Property and Equipment, Net | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Property, Plant and Equipment Disclosure [Text Block] | ' | ||||||||
5. Property and Equipment, net | |||||||||
Property and equipment consist of the following: | |||||||||
September 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Laboratory and production equipment | $ | 44,960 | $ | 34,443 | |||||
Office, software and computer equipment | 12,830 | 8,649 | |||||||
Furniture and fixtures | 1,196 | 834 | |||||||
Leasehold improvements | 5,135 | 3,952 | |||||||
64,121 | 47,878 | ||||||||
Less accumulated depreciation | (32,749 | ) | (25,418 | ) | |||||
$ | 31,372 | $ | 22,460 | ||||||
Depreciation and amortization expense of property and equipment for the three and nine months ended September 30, 2014 was $2,962 and $7,891, respectively. Depreciation and amortization expense of property and equipment for the three and nine months ended September 30, 2013 was $1,912 and $5,525, respectively. | |||||||||
As of September 30, 2014 and December 31, 2013, computer software costs included in property and equipment were $6,645 and $2,815, respectively. Amortization expense of capitalized computer software costs was $149 and $385 for the three and nine months ended September 30, 2014, respectively. Amortization expense of capitalized computer software costs was $66 and $197 for the three and nine months ended September 30, 2013, respectively. |
Note_6_Identifiable_Intangible
Note 6 - Identifiable Intangible Assets | 9 Months Ended |
Sep. 30, 2014 | |
Disclosure Text Block [Abstract] | ' |
Intangible Assets Disclosure [Text Block] | ' |
6. Identifiable Intangible assets | |
In July 2014, the Company purchased 103 patents for $1,079. The amortization expense during the three and nine months ended September 30, 2014 was $52. The net book value of the patents was included in other assets in the consolidated balance sheet. |
Note_7_Product_Warranty_Obliga
Note 7 - Product Warranty Obligation | 9 Months Ended |
Sep. 30, 2014 | |
Product Warranties Disclosures [Abstract] | ' |
Product Warranty Disclosure [Text Block] | ' |
7. Product Warranty Obligation | |
As of September 30, 2014 and December 31, 2013, the product warranty liability was $40. There was no movement in product warranty liability during the three and nine months ended September 30, 2014 and 2013. | |
On November 3, 2014, the Company received a claim notification from an insurance company asserting a claim of approximately $4,000 for field installation repair and replacement costs incurred by a customer in 2011. The Company believes that it had fulfilled its contractual obligation to provide warranty repair and replacement, but has referred the matter to its insurance carrier at the request of the insurance company. Nevertheless, resolutions of third-party claims are inherently uncertain and as such, an unfavorable outcome could ultimately impact the Company’s business, cash flow and results of operations. |
Note_8_Other_LongTerm_Liabilit
Note 8 - Other Long-Term Liabilities | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Other Liabilities and Financial Instruments Subject to Mandatory Redemption [Abstract] | ' | ||||||||
Other Liabilities Disclosure [Text Block] | ' | ||||||||
8. Other long-term liabilities | |||||||||
Other long-term liabilities consist of the following: | |||||||||
September 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Deferred rent | $ | 1,973 | $ | 1,471 | |||||
Income tax payable | 3,244 | 3,295 | |||||||
Deferred tax liabilities | 907 | 1,099 | |||||||
$ | 6,124 | $ | 5,865 | ||||||
Note_9_Income_Taxes
Note 9 - Income Taxes | 9 Months Ended |
Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Tax Disclosure [Text Block] | ' |
9. Income Taxes | |
The Company normally determines its interim provision using an estimated single annual effective tax rate for all tax jurisdictions. ASC 740 provides that when an entity operates in a jurisdiction that has generated ordinary losses on a year-to-date basis or on the basis of the results anticipated for the full fiscal year and no benefit can be recognized on those losses, a separate effective tax rate should be computed and applied to ordinary income (or loss) in that jurisdiction. The Company incurred pretax loss during the three and nine months ended September 30, 2014 from the Singapore operation and will not recognize tax benefit of the losses due to full valuation allowance established against deferred tax assets. Thus, separate effective tax rate was applied to losses from each loss jurisdiction to compute the Company’s interim tax expense. For the three and nine months ended September 30, 2014, the discrete method was used to calculate the Company’s interim tax expense for the U.S. operations. The Company has determined that a calculation of an annual effective tax rate would not represent a reliable estimate due to the sensitivity of the annual effective tax rate estimate to even minimal changes to forecasted earnings of the U.S. operations for the year. Under the discrete method, the Company determines its tax expense based upon actual results as if the interim period were an annual period. The Company recorded an income tax provision of $5,083 and $1,449 in the three and nine months ended September 30, 2014, respectively. The effective tax rate for the three and nine months ended September 30, 2014 was (287%) and (38%), respectively. The difference between the effective tax rates and the 34% federal statutory rate resulted primarily due to the change in valuation allowance, foreign income taxes provided at lower rates, geographic mix in operating results, unrecognized tax benefits, stock-based compensation adjustments, transaction cost adjustment and recognition of state research and development credits. | |
For three and nine months ended September 30, 2013, the Company used estimated annual effective tax rate methodology to compute the interim period tax provision. The Company recorded an income tax provision (benefit) of ($107) and $1,158 in the three and nine months ended September 30, 2013, respectively The effective tax rate for the three and nine months ended September 30, 2013 was 4% and (11%), respectively from (81%) and 10% in the comparable periods of 2012, respectively. The difference between the effective tax rates and the 35% federal statutory rate resulted primarily due to the change in valuation allowance (originally established in the fourth quarter of 2012), foreign income taxes provided at lower rates, geographic mix in operating results, unrecognized tax benefits and stock-based compensation adjustments. | |
During the three and nine months ended September 30, 2014, the gross amount of the Company’s unrecognized tax benefits increased by approximately $2,763 and $693, respectively as a result of allocating the tax positions expected to be taken during the current year to the interim period based on year to date results. Substantially all of the unrecognized tax benefits as of September 30, 2014, if recognized, would affect the Company’s effective tax rate. As of September 30, 2014, the Company does not expect any significant increases or decreases to its unrecognized tax benefits within the next 12 months. | |
The Company does not provide for U.S. income taxes on undistributed earnings of its controlled foreign corporations that are intended to be invested indefinitely outside the United States. |
Note_10_Earnings_Per_Share
Note 10 - Earnings Per Share | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Earnings Per Share [Text Block] | ' | ||||||||||||||||
10. Earnings Per Share | |||||||||||||||||
The following shows the computation of basic and diluted earnings per share: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Numerator | |||||||||||||||||
Net loss | $ | (6,857 | ) | $ | (2,760 | ) | $ | (5,218 | ) | $ | (11,905 | ) | |||||
Denominator | |||||||||||||||||
Weighted average common stock | 31,655,211 | 29,643,573 | 31,247,483 | 29,269,542 | |||||||||||||
Less weighted average unvested restricted stock award | — | (3,923 | ) | — | (3,923 | ) | |||||||||||
Weighted-average common stock—basic and diluted | 31,655,211 | 29,639,650 | 31,247,483 | 29,265,619 | |||||||||||||
Earnings per share | |||||||||||||||||
Basic | $ | (0.22 | ) | $ | (0.09 | ) | $ | (0.17 | ) | $ | (0.41 | ) | |||||
Diluted | $ | (0.22 | ) | $ | (0.09 | ) | $ | (0.17 | ) | $ | (0.41 | ) | |||||
The following securities were not included in the computation of diluted earnings per share as inclusion would have been anti-dilutive: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Common stock options | 3,200,469 | 4,343,306 | 3,426,621 | 4,518,888 | |||||||||||||
Warrant to purchase common stock | — | 2,142 | — | 2,142 | |||||||||||||
Restricted stock unit | 3,825,393 | 3,081,491 | 3,391,899 | 2,995,628 | |||||||||||||
Restricted stock award | — | 3,923 | — | 3,923 | |||||||||||||
7,025,862 | 7,430,862 | 6,818,520 | 7,520,581 | ||||||||||||||
Note_11_StockBased_Compensatio
Note 11 - Stock-Based Compensation | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | ' | ||||||||||||||||
11. Stock–Based Compensation | |||||||||||||||||
In 2000, the Company adopted the 2000 Stock Option/Stock Issuance Plan (the “2000 Plan”). Under the provisions of the 2000 Plan, employees, outside directors, consultants and other independent advisors who provide services to the Company may be issued incentive and non-qualified stock options to purchase common stock or may be issued shares of common stock directly. The Compensation Committee of the Board of Directors is authorized to administer the 2000 Plan and establish the stock option terms, including the exercise price and vesting period. Options granted under the plan may have varying vesting schedules; however, options generally vest 25% upon completion of one year of service and thereafter in 36 equal monthly installments. Options granted are immediately exercisable and the shares issued upon exercise of the option are subject to a repurchase right held by the Company. The repurchase price under the repurchase right is the original exercise price and the right lapses in accordance with the option-vesting schedule. As of September 30, 2014 and December 31, 2013, there were no unvested shares outstanding subject to the Company’s right of repurchase. The proceeds received from the unvested early exercise of options are presented in the balance sheet as liabilities and subsequently classified to equity based on the vesting schedule. The vesting of certain options granted or shares issued under the 2000 Plan is subject to acceleration of vesting upon the occurrence of certain events as defined in the 2000 Plan. | |||||||||||||||||
Under the 2000 Plan, the exercise price, in the case of an incentive stock option, cannot be less than 100%, and in the case of a nonqualified stock option, not less than 85%, of the fair market value of such shares on the date of grant. The term of the option is determined by the Compensation Committee but in no case can exceed 10 years. | |||||||||||||||||
In June 2010, the Board of Directors approved the Company’s 2010 Stock Incentive Plan (the “2010 Plan”), which became effective in November 2010. The 2010 Plan provides for the grants of restricted stock, stock appreciation rights and stock unit awards to employees, non-employee directors, advisors and consultants. The Compensation Committee administers the 2010 Plan, including the determination of the recipient of an award, the number of shares subject to each award, whether an option is to be classified as an incentive stock option or nonstatutory option, and the terms and conditions of each award, including the exercise and purchase prices and the vesting or duration of the award. Options granted under the 2010 Plan are exercisable only upon vesting. At September 30, 2014, 1,736,359 shares of common stock have been reserved for future grants under the 2010 Plan. | |||||||||||||||||
Stock Option Awards | |||||||||||||||||
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Risk-free interest rate | — | 1.99 | % | — | 1.29 | % | |||||||||||
Expected life (in years) | — | 6.25 | — | 6.25 | |||||||||||||
Dividend yield | — | — | — | — | |||||||||||||
Expected volatility | — | 50 | % | — | 50 | % | |||||||||||
The following table summarizes information regarding options outstanding: | |||||||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||||||
Shares | Average | Average | Intrinsic | ||||||||||||||
Exercise | Remaining | Value | |||||||||||||||
Price | Contractual | ||||||||||||||||
Life | |||||||||||||||||
Outstanding at December 31, 2013 | 3,883,097 | $ | 9.26 | 6.33 | $ | 16,229 | |||||||||||
Granted | — | — | |||||||||||||||
Exercised | (623,393 | ) | 4.75 | ||||||||||||||
Canceled | (78,514 | ) | 12.68 | ||||||||||||||
Outstanding at September 30, 2014 | 3,181,190 | $ | 10.06 | 6.3 | $ | 14,629 | |||||||||||
Exercisable at September 30, 2014 | 2,433,003 | $ | 9.47 | 5.92 | $ | 12,605 | |||||||||||
Vested at September 30, 2014 | 2,394,026 | $ | 9.47 | 5.93 | $ | 12,410 | |||||||||||
Vested and expected to vest at September 30, 2014 | 3,175,132 | $ | 10.05 | 6.29 | $ | 14,611 | |||||||||||
The intrinsic value of options outstanding, exercisable and vested and expected to vest is calculated based on the difference between the exercise price and the fair value of the Company’s common stock as of the respective balance sheet dates. | |||||||||||||||||
The weighted average grant date fair value per share of stock options granted to employees during the nine months ended September 30, 2014 and 2013 was $0 and $4.43, respectively. | |||||||||||||||||
The total intrinsic value of options exercised during the nine months ended September 30, 2014 and 2013 was $6,512 and $6,273, respectively. The intrinsic value of exercised options is calculated based on the difference between the exercise price and the fair value of the Company’s common stock as of the exercise date. Cash received from the exercise of stock options was $2,961 and $2,194, respectively, for the nine months ended September 30, 2014 and 2013. | |||||||||||||||||
Restricted Stock Units and Awards | |||||||||||||||||
The Company granted restricted stock units (“RSUs”) to members of the Board of Directors and employees. Most of the Company’s outstanding RSUs vest over four years with vesting contingent upon continuous service. The Company estimates the fair value of RSUs using the market price of the common stock on the date of the grant. The fair value of these awards is amortized on a straight-line basis over the vesting period. | |||||||||||||||||
The following table summarizes information regarding outstanding restricted stock units: | |||||||||||||||||
Number of | Weighted | ||||||||||||||||
Shares | Average | ||||||||||||||||
Grant Date Fair | |||||||||||||||||
Value Per Share | |||||||||||||||||
Outstanding at December 31, 2013 | 3,209,567 | $ | 11.69 | ||||||||||||||
Granted | 1,701,411 | 14.44 | |||||||||||||||
Vested | (943,973 | ) | 12.74 | ||||||||||||||
Canceled | (147,740 | ) | 11.52 | ||||||||||||||
Outstanding at September 30, 2014 | 3,819,265 | $ | 12.66 | ||||||||||||||
Expected to vest at September 30, 2014 | 3,758,417 | ||||||||||||||||
The Company granted restricted stock awards (“RSAs”) to certain members of the Board of Directors. The Company estimates the fair value of RSAs using the market price of the common stock on the date of the grant. As of December 31, 2013, the Company had 2,851 outstanding unvested RSAs, which all vested during the nine months ended September 30, 2014. | |||||||||||||||||
Employee Stock Purchase Plan | |||||||||||||||||
In December 2011, the Company adopted the Employee Stock Purchase Plan (“ESPP”). Participants purchase the Company's stock using payroll deductions, which may not exceed 15% of their total cash compensation. Pursuant to the terms of the ESPP, the "look-back" period for the stock purchase price is six months. Offering and purchase periods will begin on February 10 and August 10 of each year. Participants will be granted the right to purchase common stock at a price per share that is 85% of the lesser of the fair market value of the Company's common shares at the beginning or the end of each six-month period. | |||||||||||||||||
The ESPP imposes certain limitations upon an employee’s right to acquire common stock, including the following: (i) no employee shall be granted a right to participate if such employee immediately after the election to purchase common stock, would own stock possessing 5% or more to the total combined voting power or value of all classes of stock of the Company, and (ii) no employee may be granted rights to purchase more than $25 fair value of common stock for each calendar year. The maximum aggregate number of shares of common stock available for purchase under the ESPP is one million shares. The total common stock issued under the ESPP during the nine months ended September 30, 2014 and 2013 was 264,886 and 279,074, respectively. | |||||||||||||||||
The fair value of employee stock purchase plan is estimated at the start of offering period using the Black-Scholes option pricing model with the following assumptions for the three and nine months ended September 30, 2014 and 2013: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Risk-free interest rate | 0.06 | % | 0.07 | % | 0.07 | % | 0.1 | % | |||||||||
Expected life (in years) | 0.5 | 0.5 | 0.5 | 0.49 | |||||||||||||
Dividend yield | — | — | — | — | |||||||||||||
Expected volatility | 45 | % | 42 | % | 40 | % | 45 | % | |||||||||
Estimated fair value | $ | 4.05 | $ | 3.14 | $ | 3.55 | $ | 2.86 | |||||||||
Stock-Based Compensation Expense | |||||||||||||||||
Stock-based compensation expense is included in the Company’s results of operations as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Operating expenses | |||||||||||||||||
Cost of goods sold | $ | 314 | $ | 276 | $ | 863 | $ | 790 | |||||||||
Research and development | 3,261 | 2,446 | 8,642 | 6,675 | |||||||||||||
Sales and marketing | 1,242 | 913 | 3,040 | 2,469 | |||||||||||||
General and administrative | 1,243 | 1,048 | 3,421 | 3,066 | |||||||||||||
$ | 6,060 | $ | 4,683 | $ | 15,966 | $ | 13,000 | ||||||||||
Total unrecognized compensation cost related to unvested stock options, restricted stock units and awards at September 30, 2014, prior to the consideration of expected forfeitures, is approximately $43,178 and is expected to be recognized over a weighted-average period of 2.69 years. |
Note_12_Fair_Value_Measurement
Note 12 - Fair Value Measurements | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||
Fair Value Disclosures [Text Block] | ' | ||||||||||||
12. Fair Value Measurements | |||||||||||||
The guidance on fair value measurements requires fair value measurements to be classified and disclosed in one of the following three categories: | |||||||||||||
Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; | |||||||||||||
Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability, or | |||||||||||||
Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). | |||||||||||||
The Company measures its investments in marketable securities at fair value using the market approach, which uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The Company has cash equivalents which consist of money market funds valued using the amortized cost method, in accordance with Rule 2a-7 under the 1940 Act which approximates fair value. | |||||||||||||
The Company determines the amount of transfers between Levels 1 and 2 or transfers into or out of Level 3 by using the end-of-period fair value. The Company had no transfers among the fair value hierarchy during the three and nine months ended September 30, 2014. | |||||||||||||
The following table presents information about assets required to be carried at fair value on a recurring basis: | |||||||||||||
30-Sep-14 | Total | Level 1 | Level 2 | ||||||||||
Assets | |||||||||||||
Cash equivalents: | |||||||||||||
Money market funds | $ | 57,320 | $ | — | $ | 57,320 | |||||||
Investment in marketable securities: | |||||||||||||
US treasury securities | 2,813 | 2,813 | — | ||||||||||
Municipal bonds | 19,044 | — | 19,044 | ||||||||||
Corporate notes/bonds | 17,693 | — | 17,693 | ||||||||||
$ | 96,870 | $ | 2,813 | $ | 94,057 | ||||||||
31-Dec-13 | Total | Level 1 | Level 2 | ||||||||||
Assets | |||||||||||||
Cash equivalents: | |||||||||||||
Money market funds | $ | 5,119 | $ | — | $ | 5,119 | |||||||
Investment in marketable securities: | |||||||||||||
US treasury securities | 25,072 | 25,072 | — | ||||||||||
Municipal bonds | 34,983 | — | 34,983 | ||||||||||
Corporate notes/bonds | 28,648 | — | 28,648 | ||||||||||
Certificate of deposit | 1,501 | — | 1,501 | ||||||||||
Asset backed securities | 686 | — | 686 | ||||||||||
$ | 96,009 | $ | 25,072 | $ | 70,937 | ||||||||
Note_13_Segment_and_Geographic
Note 13 - Segment and Geographic Information | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Segment Reporting Disclosure [Text Block] | ' | ||||||||||||||||
13. 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 consolidated financial information for purposes of evaluating financial performance and allocating resources. Revenue by region is classified based on the locations to which the product is transported, which may differ from the customer’s principal offices. | |||||||||||||||||
The following table sets forth the Company’s revenue by geographic region: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
China | $ | 12,734 | $ | 6,615 | $ | 37,148 | $ | 14,810 | |||||||||
United States | 5,983 | 3,580 | 17,831 | 15,760 | |||||||||||||
Korea | 1,377 | 5,570 | 6,431 | 16,781 | |||||||||||||
Japan | 4,094 | 1,611 | 10,486 | 4,249 | |||||||||||||
Philippines | 1,976 | 2,948 | 3,714 | 5,904 | |||||||||||||
Singapore | 1,777 | 2,969 | 6,157 | 5,868 | |||||||||||||
Other | 8,337 | 3,318 | 19,622 | 10,162 | |||||||||||||
$ | 36,278 | $ | 26,611 | $ | 101,389 | $ | 73,534 | ||||||||||
As of September 30, 2014, $6,555 of long-lived tangible assets are located outside the United States, of which $5,169 are located in Taiwan. As of December 31, 2013, $5,217 of long-lived tangible assets are located outside the United States, of which $4,694 are located in Taiwan. |
Note_14_Commitments_and_Contin
Note 14 - Commitments and Contingencies | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||
Commitments and Contingencies Disclosure [Text Block] | ' | ||||
14. Commitments and Contingencies | |||||
Leases | |||||
The Company leases its facility under noncancelable lease agreements expiring in various years through 2019. The Company also licenses certain software used in its research and development activities under a term license subscription and maintenance arrangement. | |||||
As of September 30, 2014, future minimum lease payments under noncancelable operating leases having initial terms in excess of one year are as follows: | |||||
2014 (remaining) | $ | 1,751 | |||
2015 | 7,112 | ||||
2016 | 4,268 | ||||
2017 | 2,822 | ||||
2018 | 1,744 | ||||
2019 | 1,259 | ||||
$ | 18,956 | ||||
For the three and nine months ended September 30, 2014, lease operating expense was $1,916 and $5,115, respectively. For the three and nine months ended September 30, 2013, lease operating expense was $1,449 and $4,492, respectively. | |||||
Noncancelable Purchase Obligations | |||||
We depend upon third party subcontractors to manufacture our wafers. Our subcontractor relationships typically allow for the cancellation of outstanding purchase orders, but require payment of all expenses incurred through the date of cancellation. As of September 30, 2014, the total value of open purchase orders for wafers was approximately $2,821. | |||||
Legal Proceedings | |||||
Netlist, Inc. v. Inphi Corporation, Case No. 09-cv-6900 (C.D. Cal.) | |||||
On September 22, 2009, Netlist filed suit in the United States District Court, Central District of California, or the Court, asserting that the Company infringes U.S. Patent No. 7,532,537. Netlist filed an amended complaint on December 22, 2009, further asserting that the Company infringes U.S. Patent Nos. 7,619,912 and 7,636,274, collectively with U.S. Patent No. 7,532,537, the patents-in-suit, and seeking both unspecified monetary damages to be determined and an injunction to prevent further infringement. These infringement claims allege that the Company’s iMB™ and certain other memory module components infringe the patents-in-suit. The Company answered the amended complaint on February 11, 2010 and asserted that the Company does not infringe the patents-in-suit and that the patents-in-suit are invalid. In 2010, Company filed inter partes requests for reexamination with the United States Patent and Trademark Office (the “USPTO”), asserting that the patents-in-suit are invalid. | |||||
On August 27, 2010, the USPTO ordered the request for Inter Partes Reexamination for U.S. Patent No. 7,636,274 and found a substantial new question of patentability based upon each of the different issues that the Company raised as the reexamination requestor. On September 27, 2011, the Patent Office issued a First Office Action based on the Netlist '274 Patent Reexamination Request and rejected 91 of its 97 claims. On October 27, 2011, Netlist responded to the USPTO determination by amending some but not all of the claims, adding new claims and making arguments as to the validity of the rejected claims in view of the cited references. The Company provided rebuttable comments to the USPTO on November 28, 2011. On March 12, 2012, the Examiner issued an Action Closing Prosecution, indicating that the claims pending contain allowable subject matter, and Netlist did not respond to the Action Closing Prosecution in the time provided by the USPTO. On June 22, 2012, the USPTO issued a Right of Appeal Notice, and on July 23, 2012, the Company filed a Notice of Appeal. The Company filed its Appeal Brief on September 24, 2012 and Netlist filed its Responsive Brief on October 24, 2012. The parties received an Examiner’s Answer dated April 16, 2013 from the USPTO that maintained the rejections set forth on the Right of Appeal Notice dated June 22, 2012. The Company filed a Rebuttal Brief on May 16, 2013 and a Request for Oral Hearing on June 7, 2013. The appeal hearing took place on November 20, 2013. The Patent Trial and Appeal Board (PTAB) issued its decision on January 16, 2014, finding the Examiner erred in declining to adopt 8 of the 9 different rejections that had been proposed by the Company. The Company requested a rehearing of the decision not to adopt the remaining one rejection that had been proposed by Company and was not adopted by the PTAB on February 18, 2014. In papers dated March 18, 2014, Netlist provided rebuttal comments to the request for rehearing and also requested re-opening of prosecution with respect to the claims that the PTAB had rejected, and in that request to re-open prosecution amended the independent claims that stood rejected. The Company filed comments with respect to these proposed amended claims on April 17, 2014, which were refiled in a slightly different form on September 5, 2014. On June 26, 2014, the PTAB issued a decision on the request for rehearing, which included a rejection of further claims pursuant to the Company’s request and on July 28, 2014 Netlist provided a response to the USPTO cancelling those claims that had been rejected in the decision on the request for rehearing. On September 26, 2014, the PTAB remanded the proceedings back to the Examiner, with instructions to consider part, but not all, of the Company comments that had been previously filed on September 5, 2014. On October 10, 2014, the Company filed a Petition to the Director of the USPTO seeking reconsideration of the PTAB remand of September 26, 2014, and requesting that all of the comments that the Company had previously filed on September 5, 2014 should have been entered for consideration by the Examiner, A further communication from the USPTO in response to this Petition is expected as the next substantive step of the proceeding, as prosecution otherwise remains closed. The proceeding is expected to continue in accordance with established Inter Partes Reexamination procedures. | |||||
On September 8, 2010, the USPTO ordered the request for Inter Partes Reexamination for U.S. Patent No. 7,532,537 and found a substantial new question of patentability based upon different issues that the Company raised as the reexamination requestor. The USPTO accompanied this Reexamination Order of U.S. Patent No. 7,532,537 with its own evaluation of the validity of this patent, and rejected some but not all of claims. In a response dated October 8, 2010, Netlist responded to the USPTO determination by amending some but not all of the claims, adding new claims and making arguments as to why the claims were not invalid in view of the cited references. The Company provided rebuttable comments to the USPTO on November 8, 2010 along with a Petition requesting an increase in the number of allowed pages of the rebuttable comments. On January 20, 2011, the USPTO granted the Petition in part. The Company then filed updated rebuttal comments on January 27, 2011 in compliance with the granted Petition. The USPTO has considered these updated rebuttal comments, and in a communication dated June 15, 2011, continued to reject all the previously rejected claims. The USPTO also rejected all the claims newly added in the October 8, 2010 Netlist response. In a further communication dated June 21, 2011, the USPTO issued an Action Closing Prosecution indicating that it would confirm the patentability of four claims and reject all the other pending claims. On August 22, 2011, Netlist responded to the Action Closing Prosecution by further amending some claims and making arguments as to the validity of the rejected claims in view of the cited references. The Company submitted rebuttal comments on September 21, 2011. In a further communication dated February 7, 2012, the USPTO issued a Right of Appeal Notice, which also indicated that the previous amendments to claim made by Netlist would be entered, and that the current pending claims, as amended, were patentable. The Company filed a Notice of Appeal at the USPTO on March 8, 2012, within the time period provided for filing the Notice of Appeal and Netlist did not file Notice of Cross-Appeal. The Company filed its Appeal Brief on May 8, 2012, and Netlist filed its Responsive Brief on July 2, 2012. The parties received an Examiner’s Answer dated April 16, 2013 from the USPTO that maintained the rejections set forth on the Right of Appeal Notice dated February 7, 2012. The Company filed a Rebuttal Brief on May 16, 2013 and a Request for Oral Hearing on June 7, 2013. The appeal hearing took place in front of the PTAB on November 20, 2013. The PTAB issued its decision on January 16, 2014, affirming the Examiner’s decision as to all of the challenged claims. On February 18, 2014, the Company made a request for rehearing of the decision, and in papers dated March 18, 2014, Netlist provided rebuttal comments to the request for rehearing. On August 13, 2014, the PTAB denied the Company request for rehearing, and on October 15, 2014, the Company filed a Notice of Appeal to the Court of Appeals for the Federal Circuit. An Appeal Brief filed with the Court of Appeals for the Federal Circuit is expected as the next substantive step of the proceeding, as prosecution otherwise remains closed. The proceeding is expected to continue in accordance with established Inter Partes Reexamination procedures. | |||||
On September 8, 2010, the USPTO ordered the request for Inter Partes Reexamination for U.S. Patent No. 7,619,912 and found a substantial new question of patentability based upon different issues that the Company raised as the reexamination requestor. The USPTO accompanied this Reexamination Order of U.S. Patent No. 7,619,912 with its own evaluation of the validity of this patent, and initially determined that all of the claims were patentable based upon the Company’s request for Inter Partes Reexamination. Netlist did not comment upon this Reexamination Order. The USPTO on February 28, 2011 also merged the Proceedings of the Company’s Reexamination of U.S. Patent No. 7,619,912, bearing Control No. 90/001,339 with Inter Partes Reexamination Proceeding 95/000,578 filed October 20, 2010 on behalf of SMART Modular Technologies, Inc. and Inter Partes Reexamination Proceeding 95/000,579 filed October 21, 2010 on behalf of Google, Inc. In each of these other Reexamination Proceedings, the USPTO had indicated that there existed a substantial new question of patentability with respect to certain claims of U.S. Patent No. 7,619,912, but had not accompanied the Reexamination Orders related thereto with its own evaluation of the validity of this patent, indicating that such evaluation would be forthcoming at a later time. This further evaluation was received in an Office Action dated April 4, 2011, in which the Examiner rejected a substantial majority of the claims based upon a number of different rejections, including certain of the rejections originally proposed by the Company in its Request for Reexamination. This Office Action also indicated that one claim was deemed to be patentable over the prior art of record in the merged Reexamination Proceedings. After seeking and obtaining an extension of time to respond to the Office Action dated April 4, 2011, Netlist served its response on July 5, 2011, which added new claims and made arguments as to why the originally filed claims were not invalid in view of the cited references. Each of the merged Reexamination Requestors, including the Company, submitted rebuttal comments by August 29, 2011. The USPTO considered this Netlist response and each of the rebuttal comments, and in an Office Action dated October 14, 2011, continued to reject most, but not all of the previously rejected claims, as well as rejected claims that had been added by Netlist in its July 5, 2011 response. After seeking and obtaining an extension of time to respond to the Office Action dated October 14, 2011, Netlist served its response on January 13, 2012, which response made amendments based upon subject matter that had been indicated as allowable in the Office Action dated October 14, 2011, added other new claims and made arguments as to why all of these claims should be allowed. The three different merged Reexamination Requestors, including the Company, timely submitted rebuttal comments on or about February 13, 2012. The USPTO issued a Non-final Office Action on November 13, 2012, rejecting some claims and indicating that others contained allowable subject matter. On January 14, 2013, Netlist filed a Response to the Non-final Office Action which presented further claim amendments and evidence supporting its positions regarding patentability. Rebuttal comments from the Company and the other Requestors were filed on February 13, 2013. On March 21, 2014, the USPTO issued an Action Closing Prosecution in which the USPTO indicated that certain of the pending claims were allowable and other of the pending claims were rejected, and on June 18, 2014 issued a Right of Notice of Appeal. By July 18, 2014, the Company as well as other Requesters each filed Notices of Appeal, and Netlist filed a Cross Appeal on July 30, 2014. By September 30, 2014, each of the Requestors as well as Netlist had filed their respective Appeal Briefs, and by October 30, 2014 each of the Requestors as well as Netlist had filed their respective Responses to the previously filed Appeal Briefs. Reply Briefs by Requesters and Netlist will be the next substantive step of the proceeding after receipt of a further USPTO communication, as currently prosecution otherwise will remain closed. The merged proceeding is expected to continue in accordance with established Inter Partes Reexamination procedures. | |||||
The reexamination proceedings could result in a determination that the patents-in-suit, in whole or in part, are valid or invalid, as well as modifications of the scope of the patents-in-suit. | |||||
Based on these papers the Court in January 2014 ordered a continued stay of the proceedings, took the litigation off the active court calendar, and requested that the parties file a joint status report on May 1, 2014 and every 120 days thereafter advising the Court as to status of the reexamination proceedings at which times, the Court could decide to maintain or lift the stay. | |||||
While the Company intends to defend the foregoing lawsuit vigorously, litigation, whether or not determined in the Company’s favor or settled, could be costly and time-consuming and could divert management’s attention and resources, which could adversely affect the Company’s business. | |||||
Based on the nature of the litigation, the Company is currently unable to predict the final outcome of this lawsuit and therefore, cannot determine the likelihood of loss nor estimate a range of possible loss. However, because of the nature and inherent uncertainties of litigation, should the outcome of these actions be unfavorable, the Company’s business, financial condition, results of operations or cash flows could be materially and adversely affected. | |||||
Indemnifications | |||||
In the ordinary course of business, the Company may provide indemnifications of varying scope and terms to customers, vendors, lessors, investors, directors, officers, employees and other parties with respect to certain matters, including, but not limited to, losses arising out of the Company’s breach of such agreements, services to be provided by the Company, or from intellectual property infringement claims made by third-parties. These indemnifications may survive termination of the underlying agreement and the maximum potential amount of future payments the Company could be required to make under these indemnification provisions may not be subject to maximum loss clauses. The Company has not incurred material costs to defend lawsuits or settle claims related to these indemnifications. Accordingly, the Company has no liabilities recorded for these agreements as of September 30, 2014 and December 31, 2013. |
Note_15_Subsequent_Event
Note 15 - Subsequent Event | 9 Months Ended |
Sep. 30, 2014 | |
Subsequent Events [Abstract] | ' |
Subsequent Events [Text Block] | ' |
15. Subsequent Event | |
On October 3, 2014, the Company completed the acquisition of Cortina Systems, Inc.’s high-speed interconnect and optical transport product lines (Cortina) for approximately $52.7 million in cash and approximately 5.3 million shares of the Company’s common stock in accordance with the Agreement and Plan of Merger dated July 30, 2014 as amended by Amendment No. 1 to the Agreement and Plan of Merger dated September 25, 2014. The Company purchased Cortina to expand the Company’s market share of the high-speed optical and networking interconnects. The acquisition was financed through existing cash. Cash of $16.5 million was placed in an escrow fund for up to 12 months following the closing for the satisfaction of certain indemnification claims. The Company is in the process of determining the purchase price allocation for this acquisition. | |
On October 16, 2014, the Compensation Committee of the Board of Directors granted one-time employment RSU awards of 1,000,000 shares to certain Cortina employees who entered employment with the Company commencing upon the closing of the acquisition. The awards vest over four years with vesting contingent upon continuous service. |
Note_3_Investments_Tables
Note 3 - Investments (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Investments Schedule [Abstract] | ' | ||||||||||||||||
Available-for-sale Securities [Table Text Block] | ' | ||||||||||||||||
30-Sep-14 | 31-Dec-13 | ||||||||||||||||
Cost | Fair Value | Cost | Fair Value | ||||||||||||||
Available-for-sale securities: | |||||||||||||||||
US treasury securities | $ | 2,810 | $ | 2,813 | $ | 25,061 | $ | 25,072 | |||||||||
Municipal bonds | 18,994 | 19,044 | 34,912 | 34,983 | |||||||||||||
Corporate notes/bonds | 17,652 | 17,693 | 28,565 | 28,648 | |||||||||||||
Certificate of deposit | — | — | 1,500 | 1,501 | |||||||||||||
Asset backed securities | — | — | 685 | 686 | |||||||||||||
Total investments | $ | 39,456 | $ | 39,550 | $ | 90,723 | $ | 90,890 | |||||||||
Investments Classified by Contractual Maturity Date [Table Text Block] | ' | ||||||||||||||||
Cost | Fair Value | ||||||||||||||||
Due in one year or less | $ | 12,624 | $ | 12,678 | |||||||||||||
Due between one and five years | 26,832 | 26,872 | |||||||||||||||
$ | 39,456 | $ | 39,550 |
Note_4_Inventories_Tables
Note 4 - Inventories (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Schedule of Inventory, Current [Table Text Block] | ' | ||||||||
September 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Raw materials | $ | 1,316 | $ | 670 | |||||
Work in process | 2,207 | 2,001 | |||||||
Finished goods | 5,685 | 4,096 | |||||||
$ | 9,208 | $ | 6,767 |
Note_5_Property_and_Equipment_1
Note 5 - Property and Equipment, Net (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Property, Plant and Equipment [Table Text Block] | ' | ||||||||
September 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Laboratory and production equipment | $ | 44,960 | $ | 34,443 | |||||
Office, software and computer equipment | 12,830 | 8,649 | |||||||
Furniture and fixtures | 1,196 | 834 | |||||||
Leasehold improvements | 5,135 | 3,952 | |||||||
64,121 | 47,878 | ||||||||
Less accumulated depreciation | (32,749 | ) | (25,418 | ) | |||||
$ | 31,372 | $ | 22,460 |
Note_8_Other_LongTerm_Liabilit1
Note 8 - Other Long-Term Liabilities (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Other Liabilities and Financial Instruments Subject to Mandatory Redemption [Abstract] | ' | ||||||||
Other Noncurrent Liabilities [Table Text Block] | ' | ||||||||
September 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Deferred rent | $ | 1,973 | $ | 1,471 | |||||
Income tax payable | 3,244 | 3,295 | |||||||
Deferred tax liabilities | 907 | 1,099 | |||||||
$ | 6,124 | $ | 5,865 |
Note_10_Earnings_Per_Share_Tab
Note 10 - Earnings Per Share (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | ' | ||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Numerator | |||||||||||||||||
Net loss | $ | (6,857 | ) | $ | (2,760 | ) | $ | (5,218 | ) | $ | (11,905 | ) | |||||
Denominator | |||||||||||||||||
Weighted average common stock | 31,655,211 | 29,643,573 | 31,247,483 | 29,269,542 | |||||||||||||
Less weighted average unvested restricted stock award | — | (3,923 | ) | — | (3,923 | ) | |||||||||||
Weighted-average common stock—basic and diluted | 31,655,211 | 29,639,650 | 31,247,483 | 29,265,619 | |||||||||||||
Earnings per share | |||||||||||||||||
Basic | $ | (0.22 | ) | $ | (0.09 | ) | $ | (0.17 | ) | $ | (0.41 | ) | |||||
Diluted | $ | (0.22 | ) | $ | (0.09 | ) | $ | (0.17 | ) | $ | (0.41 | ) | |||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | ' | ||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Common stock options | 3,200,469 | 4,343,306 | 3,426,621 | 4,518,888 | |||||||||||||
Warrant to purchase common stock | — | 2,142 | — | 2,142 | |||||||||||||
Restricted stock unit | 3,825,393 | 3,081,491 | 3,391,899 | 2,995,628 | |||||||||||||
Restricted stock award | — | 3,923 | — | 3,923 | |||||||||||||
7,025,862 | 7,430,862 | 6,818,520 | 7,520,581 |
Note_11_StockBased_Compensatio1
Note 11 - Stock-Based Compensation (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | ' | ||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Risk-free interest rate | — | 1.99 | % | — | 1.29 | % | |||||||||||
Expected life (in years) | — | 6.25 | — | 6.25 | |||||||||||||
Dividend yield | — | — | — | — | |||||||||||||
Expected volatility | — | 50 | % | — | 50 | % | |||||||||||
Schedule of Share-based Compensation, Activity [Table Text Block] | ' | ||||||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||||||
Shares | Average | Average | Intrinsic | ||||||||||||||
Exercise | Remaining | Value | |||||||||||||||
Price | Contractual | ||||||||||||||||
Life | |||||||||||||||||
Outstanding at December 31, 2013 | 3,883,097 | $ | 9.26 | 6.33 | $ | 16,229 | |||||||||||
Granted | — | — | |||||||||||||||
Exercised | (623,393 | ) | 4.75 | ||||||||||||||
Canceled | (78,514 | ) | 12.68 | ||||||||||||||
Outstanding at September 30, 2014 | 3,181,190 | $ | 10.06 | 6.3 | $ | 14,629 | |||||||||||
Exercisable at September 30, 2014 | 2,433,003 | $ | 9.47 | 5.92 | $ | 12,605 | |||||||||||
Vested at September 30, 2014 | 2,394,026 | $ | 9.47 | 5.93 | $ | 12,410 | |||||||||||
Vested and expected to vest at September 30, 2014 | 3,175,132 | $ | 10.05 | 6.29 | $ | 14,611 | |||||||||||
Schedule of Nonvested Restricted Stock Units Activity [Table Text Block] | ' | ||||||||||||||||
Number of | Weighted | ||||||||||||||||
Shares | Average | ||||||||||||||||
Grant Date Fair | |||||||||||||||||
Value Per Share | |||||||||||||||||
Outstanding at December 31, 2013 | 3,209,567 | $ | 11.69 | ||||||||||||||
Granted | 1,701,411 | 14.44 | |||||||||||||||
Vested | (943,973 | ) | 12.74 | ||||||||||||||
Canceled | (147,740 | ) | 11.52 | ||||||||||||||
Outstanding at September 30, 2014 | 3,819,265 | $ | 12.66 | ||||||||||||||
Expected to vest at September 30, 2014 | 3,758,417 | ||||||||||||||||
Schedule of Share-based Payment Award, Employee Stock Purchase Plan, Valuation Assumptions [Table Text Block] | ' | ||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Risk-free interest rate | 0.06 | % | 0.07 | % | 0.07 | % | 0.1 | % | |||||||||
Expected life (in years) | 0.5 | 0.5 | 0.5 | 0.49 | |||||||||||||
Dividend yield | — | — | — | — | |||||||||||||
Expected volatility | 45 | % | 42 | % | 40 | % | 45 | % | |||||||||
Estimated fair value | $ | 4.05 | $ | 3.14 | $ | 3.55 | $ | 2.86 | |||||||||
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block] | ' | ||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Operating expenses | |||||||||||||||||
Cost of goods sold | $ | 314 | $ | 276 | $ | 863 | $ | 790 | |||||||||
Research and development | 3,261 | 2,446 | 8,642 | 6,675 | |||||||||||||
Sales and marketing | 1,242 | 913 | 3,040 | 2,469 | |||||||||||||
General and administrative | 1,243 | 1,048 | 3,421 | 3,066 | |||||||||||||
$ | 6,060 | $ | 4,683 | $ | 15,966 | $ | 13,000 |
Note_12_Fair_Value_Measurement1
Note 12 - Fair Value Measurements (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||
Fair Value, Assets Measured on Recurring Basis [Table Text Block] | ' | ||||||||||||
30-Sep-14 | Total | Level 1 | Level 2 | ||||||||||
Assets | |||||||||||||
Cash equivalents: | |||||||||||||
Money market funds | $ | 57,320 | $ | — | $ | 57,320 | |||||||
Investment in marketable securities: | |||||||||||||
US treasury securities | 2,813 | 2,813 | — | ||||||||||
Municipal bonds | 19,044 | — | 19,044 | ||||||||||
Corporate notes/bonds | 17,693 | — | 17,693 | ||||||||||
$ | 96,870 | $ | 2,813 | $ | 94,057 | ||||||||
31-Dec-13 | Total | Level 1 | Level 2 | ||||||||||
Assets | |||||||||||||
Cash equivalents: | |||||||||||||
Money market funds | $ | 5,119 | $ | — | $ | 5,119 | |||||||
Investment in marketable securities: | |||||||||||||
US treasury securities | 25,072 | 25,072 | — | ||||||||||
Municipal bonds | 34,983 | — | 34,983 | ||||||||||
Corporate notes/bonds | 28,648 | — | 28,648 | ||||||||||
Certificate of deposit | 1,501 | — | 1,501 | ||||||||||
Asset backed securities | 686 | — | 686 | ||||||||||
$ | 96,009 | $ | 25,072 | $ | 70,937 |
Note_13_Segment_and_Geographic1
Note 13 - Segment and Geographic Information (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] | ' | ||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
China | $ | 12,734 | $ | 6,615 | $ | 37,148 | $ | 14,810 | |||||||||
United States | 5,983 | 3,580 | 17,831 | 15,760 | |||||||||||||
Korea | 1,377 | 5,570 | 6,431 | 16,781 | |||||||||||||
Japan | 4,094 | 1,611 | 10,486 | 4,249 | |||||||||||||
Philippines | 1,976 | 2,948 | 3,714 | 5,904 | |||||||||||||
Singapore | 1,777 | 2,969 | 6,157 | 5,868 | |||||||||||||
Other | 8,337 | 3,318 | 19,622 | 10,162 | |||||||||||||
$ | 36,278 | $ | 26,611 | $ | 101,389 | $ | 73,534 |
Note_14_Commitments_and_Contin1
Note 14 - Commitments and Contingencies (Tables) | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | ' | ||||
2014 (remaining) | $ | 1,751 | |||
2015 | 7,112 | ||||
2016 | 4,268 | ||||
2017 | 2,822 | ||||
2018 | 1,744 | ||||
2019 | 1,259 | ||||
$ | 18,956 |
Note_3_Investments_Details
Note 3 - Investments (Details) (USD $) | Sep. 30, 2014 |
In Thousands, unless otherwise specified | |
Investments Schedule [Abstract] | ' |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | 14 |
Available-for-sale Equity Securities, Accumulated Gross Unrealized Loss, before Tax | $26 |
Note_3_Investments_Details_Sum
Note 3 - Investments (Details) - Summary of Investments by Investment (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Available-for-sale securities: | ' | ' |
Available-for-sale Securities, Cost | $39,456 | $90,723 |
Available-for-sale Securities, Fair Value | 39,550 | 90,890 |
US Treasury Securities [Member] | ' | ' |
Available-for-sale securities: | ' | ' |
Available-for-sale Securities, Cost | 2,810 | 25,061 |
Available-for-sale Securities, Fair Value | 2,813 | 25,072 |
US States and Political Subdivisions Debt Securities [Member] | ' | ' |
Available-for-sale securities: | ' | ' |
Available-for-sale Securities, Cost | 18,994 | 34,912 |
Available-for-sale Securities, Fair Value | 19,044 | 34,983 |
Corporate Debt Securities [Member] | ' | ' |
Available-for-sale securities: | ' | ' |
Available-for-sale Securities, Cost | 17,652 | 28,565 |
Available-for-sale Securities, Fair Value | 17,693 | 28,648 |
Certificates of Deposit [Member] | ' | ' |
Available-for-sale securities: | ' | ' |
Available-for-sale Securities, Cost | ' | 1,500 |
Available-for-sale Securities, Fair Value | ' | 1,501 |
Asset-backed Securities [Member] | ' | ' |
Available-for-sale securities: | ' | ' |
Available-for-sale Securities, Cost | ' | 685 |
Available-for-sale Securities, Fair Value | ' | $686 |
Note_3_Investments_Details_Con
Note 3 - Investments (Details) - Contractual Maturities of Available-for-Sale Securities (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Contractual Maturities of Available-for-Sale Securities [Abstract] | ' | ' |
Due in one year or less | $12,624 | ' |
Due in one year or less | 12,678 | ' |
Due between one and five years | 26,832 | ' |
Due between one and five years | 26,872 | ' |
39,456 | ' | |
$39,550 | $90,890 |
Note_4_Inventories_Details
Note 4 - Inventories (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Other Inventory, Materials, Supplies and Merchandise under Consignment, Gross | $1,704 | $543 |
Note_4_Inventories_Details_Inv
Note 4 - Inventories (Details) - Inventory (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Inventory [Abstract] | ' | ' |
Raw materials | $1,316 | $670 |
Work in process | 2,207 | 2,001 |
Finished goods | 5,685 | 4,096 |
$9,208 | $6,767 |
Note_5_Property_and_Equipment_2
Note 5 - Property and Equipment, Net (Details) (Property and Equipment [Member], USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Property and Equipment [Member] | ' | ' | ' | ' | ' |
Note 5 - Property and Equipment, Net (Details) [Line Items] | ' | ' | ' | ' | ' |
Depreciation | $2,962 | $1,912 | $7,891 | $5,525 | ' |
Capitalized Computer Software, Gross | 6,645 | ' | 6,645 | ' | 2,815 |
Capitalized Computer Software, Amortization | $149 | $66 | $385 | $197 | ' |
Note_5_Property_and_Equipment_3
Note 5 - Property and Equipment, Net (Details) - Property and Equipment (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Gross | $64,121 | $47,878 |
Less accumulated depreciation | -32,749 | -25,418 |
31,372 | 22,460 | |
Equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Gross | 44,960 | 34,443 |
Other Machinery and Equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Gross | 12,830 | 8,649 |
Furniture and Fixtures [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Gross | 1,196 | 834 |
Leasehold Improvements [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Gross | $5,135 | $3,952 |
Note_6_Identifiable_Intangible1
Note 6 - Identifiable Intangible Assets (Details) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended |
In Thousands, unless otherwise specified | Jul. 31, 2014 | Sep. 30, 2014 | Sep. 30, 2014 |
Note 6 - Identifiable Intangible Assets (Details) [Line Items] | ' | ' | ' |
Number of Patents Purchased | 103 | ' | ' |
Payments to Acquire Intangible Assets | ' | ' | $1,079 |
Patents [Member] | ' | ' | ' |
Note 6 - Identifiable Intangible Assets (Details) [Line Items] | ' | ' | ' |
Payments to Acquire Intangible Assets | 1,079 | ' | ' |
Amortization of Intangible Assets | ' | $52 | $52 |
Note_7_Product_Warranty_Obliga1
Note 7 - Product Warranty Obligation (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Nov. 03, 2014 |
Subsequent Event [Member] | ||||||
Note 7 - Product Warranty Obligation (Details) [Line Items] | ' | ' | ' | ' | ' | ' |
Product Warranty Accrual | $40 | ' | $40 | ' | $40 | ' |
Product Warranty Accrual, Period Increase (Decrease) | 0 | 0 | 0 | 0 | ' | ' |
Loss Contingency, Estimate of Possible Loss | ' | ' | ' | ' | ' | $4,000 |
Note_8_Other_LongTerm_Liabilit2
Note 8 - Other Long-Term Liabilities (Details) - Other Long-Term Liabilities (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Other Long-Term Liabilities [Abstract] | ' | ' |
Deferred rent | $1,973 | $1,471 |
Income tax payable | 3,244 | 3,295 |
Deferred tax liabilities | 907 | 1,099 |
$6,124 | $5,865 |
Note_9_Income_Taxes_Details
Note 9 - Income Taxes (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Tax Disclosure [Abstract] | ' | ' | ' | ' | ' | ' |
Income Tax Expense (Benefit) (in Dollars) | $5,083 | ($107) | ' | $1,449 | $1,158 | ' |
Effective Income Tax Rate Reconciliation, Percent | 287.00% | 4.00% | -81.00% | 38.00% | -11.00% | 10.00% |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 34.00% | 35.00% | 35.00% | 34.00% | 35.00% | 35.00% |
Unrecognized Tax Benefits, Increase Resulting from Current Period Tax Positions (in Dollars) | 2,763 | ' | ' | 693 | ' | ' |
Significant (Increase) Decrease in Unrecognized Tax Benefits is Reasonably Possible, Estimated Range of Change, Lower Bound (in Dollars) | 0 | ' | ' | 0 | ' | ' |
Significant (Increase) Decrease in Unrecognized Tax Benefits is Reasonably Possible, Estimated Range of Change, Upper Bound (in Dollars) | $0 | ' | ' | $0 | ' | ' |
Note_10_Earnings_Per_Share_Det
Note 10 - Earnings Per Share (Details) - Computation of Basic and Diluted Earnings Per Share (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Numerator | ' | ' | ' | ' |
Net loss (in Dollars) | ($6,857) | ($2,760) | ($5,218) | ($11,905) |
Denominator | ' | ' | ' | ' |
Weighted average common stock | 31,655,211 | 29,643,573 | 31,247,483 | 29,269,542 |
Less weighted average unvested restricted stock award | ' | -3,923 | ' | -3,923 |
Weighted-average common stock—basic and diluted | 31,655,211 | 29,639,650 | 31,247,483 | 29,265,619 |
Earnings per share | ' | ' | ' | ' |
Basic (in Dollars per share) | ($0.22) | ($0.09) | ($0.17) | ($0.41) |
Diluted (in Dollars per share) | ($0.22) | ($0.09) | ($0.17) | ($0.41) |
Note_10_Earnings_Per_Share_Det1
Note 10 - Earnings Per Share (Details) - Securities Not Included in Computation of Earnings Per Share | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities | 7,025,862 | 7,430,862 | 6,818,520 | 7,520,581 |
Equity Option [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities | 3,200,469 | 4,343,306 | 3,426,621 | 4,518,888 |
Warrant [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities | ' | 2,142 | ' | 2,142 |
Restricted Stock Units (RSUs) [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities | 3,825,393 | 3,081,491 | 3,391,899 | 2,995,628 |
Restricted Stock [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities | ' | 3,923 | ' | 3,923 |
Note_11_StockBased_Compensatio2
Note 11 - Stock-Based Compensation (Details) (USD $) | 9 Months Ended | 9 Months Ended | 6 Months Ended | 9 Months Ended | ||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2014 |
Restricted Stock [Member] | Restricted Stock [Member] | Two Thousand Stock Option Stock Issuance Plan [Member] | Two Thousand and Ten Stock Incentive Plan [Member] | Employee Stock Option Plan [Member] | Employee Stock Option Plan [Member] | |||
Note 11 - Stock-Based Compensation (Details) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Percent of Options to Vest After One Year of Service | ' | ' | ' | ' | 25.00% | ' | ' | ' |
Vesting Period of 25% of Options Granted | ' | ' | ' | ' | '1 year | ' | ' | ' |
Monthly Vesting Period of Options Granted | ' | ' | ' | ' | '36 months | ' | ' | ' |
Minimum Exercise Price as Percentage of Fair Market Value of Incentive Stock Option | ' | ' | ' | ' | 100.00% | ' | ' | ' |
Minimum Exercise Price as Percentage of Fair Market Value of Nonqualified Stock Option | ' | ' | ' | ' | 85.00% | ' | ' | ' |
Term of Option | ' | ' | ' | ' | '10 years | ' | ' | ' |
Common Stock, Capital Shares Reserved for Future Issuance | ' | ' | ' | ' | ' | 1,736,359 | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $0 | $4.43 | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $6,512 | $6,273 | ' | ' | ' | ' | ' | ' |
Proceeds from Stock Options Exercised | 2,961 | 2,194 | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | ' | ' | '4 years | ' | ' | ' | ' | ' |
Shares Subject to Repurchase | ' | ' | ' | 2,851 | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 2,851 | ' | 943,973 | ' | ' | ' | ' | ' |
Maximum Percentage of Aggregate Cash Compensation for Purchase of Stock Using Payroll Deduction | ' | ' | ' | ' | ' | ' | ' | 15.00% |
Look-Back Period of Employee Stock Purchase Plan | '6 months | ' | ' | ' | ' | ' | ' | ' |
Purchase Price Per Share as Percentage of Market Value | ' | ' | ' | ' | ' | ' | ' | 85.00% |
Percentage of Combined Voting Power or Value of All Classes of Stock Not Eligible to Participate | ' | ' | ' | ' | ' | ' | ' | 5.00% |
Fair Value of Common Stock in Calendar Year Per Employee Not Eligible to Participate | ' | ' | ' | ' | ' | ' | ' | 25 |
Maximum Aggregate Number of Shares of Common Stock Available for Purchase Under the Employee Stock Purchase Plan | ' | ' | ' | ' | ' | ' | 1,000,000 | ' |
Stock Issued During Period, Shares, Employee Stock Purchase Plans | 264,886 | 279,074 | ' | ' | ' | ' | ' | ' |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $43,178 | ' | ' | ' | ' | ' | ' | ' |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | '2 years 251 days | ' | ' | ' | ' | ' | ' | ' |
Note_11_StockBased_Compensatio3
Note 11 - Stock-Based Compensation (Details) - Fair Value Option Grant Weighted Average Assumptions Using Black-Scholes Option Pricing Model | 3 Months Ended | 9 Months Ended |
Sep. 30, 2013 | Sep. 30, 2013 | |
Fair Value Option Grant Weighted Average Assumptions Using Black-Scholes Option Pricing Model [Abstract] | ' | ' |
Risk-free interest rate | 1.99% | 1.29% |
Expected life (in years) | '6 years 3 months | '6 years 3 months |
Expected volatility | 50.00% | 50.00% |
Note_11_StockBased_Compensatio4
Note 11 - Stock-Based Compensation (Details) - Information Regarding Options Outstanding (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 |
Information Regarding Options Outstanding [Abstract] | ' | ' |
Outstanding, Number of Shares | 3,181,190 | 3,883,097 |
Outstanding, Exercise Price | $10.06 | $9.26 |
Outstanding, Contractual Life | '6 years 109 days | '6 years 120 days |
Outstanding, Intrinsic Value | $14,629 | $16,229 |
Exercisable at September 30, 2014 | 2,433,003 | ' |
Exercisable at September 30, 2014 | $9.47 | ' |
Exercisable at September 30, 2014 | '5 years 335 days | ' |
Exercisable at September 30, 2014 | 12,605 | ' |
Vested at September 30, 2014 | 2,394,026 | ' |
Vested at September 30, 2014 | $9.47 | ' |
Vested at September 30, 2014 | '5 years 339 days | ' |
Vested at September 30, 2014 | 12,410 | ' |
Vested and expected to vest at September 30, 2014 | 3,175,132 | ' |
Vested and expected to vest at September 30, 2014 | $10.05 | ' |
Vested and expected to vest at September 30, 2014 | '6 years 105 days | ' |
Vested and expected to vest at September 30, 2014 | $14,611 | ' |
Exercised | -623,393 | ' |
Exercised | $4.75 | ' |
Canceled | -78,514 | ' |
Canceled | $12.68 | ' |
Note_11_StockBased_Compensatio5
Note 11 - Stock-Based Compensation (Details) - Information Regarding Outstanding Restricted Stock Units (USD $) | 9 Months Ended |
Sep. 30, 2014 | |
Note 11 - Stock-Based Compensation (Details) - Information Regarding Outstanding Restricted Stock Units [Line Items] | ' |
Vested | -2,851 |
Restricted Stock [Member] | ' |
Note 11 - Stock-Based Compensation (Details) - Information Regarding Outstanding Restricted Stock Units [Line Items] | ' |
Outstanding, Number of Shares | 3,209,567 |
Outstanding, Weighted Average Grant Date Fair Value Per Share (in Dollars per share) | 11.69 |
Expected to vest at September 30, 2014 | 3,758,417 |
Granted | 1,701,411 |
Granted (in Dollars per share) | 14.44 |
Vested | -943,973 |
Vested (in Dollars per share) | 12.74 |
Canceled | -147,740 |
Canceled (in Dollars per share) | 11.52 |
Outstanding, Number of Shares | 3,819,265 |
Outstanding, Weighted Average Grant Date Fair Value Per Share (in Dollars per share) | 12.66 |
Note_11_StockBased_Compensatio6
Note 11 - Stock-Based Compensation (Details) - Fair Value of Employee Stock Purchase Plan (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Note 11 - Stock-Based Compensation (Details) - Fair Value of Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Risk-free interest rate | ' | 1.99% | ' | 1.29% |
Expected life (in years) | ' | '6 years 3 months | ' | '6 years 3 months |
Expected volatility | ' | 50.00% | ' | 50.00% |
Employee Stock Purchase Plan [Member] | ' | ' | ' | ' |
Note 11 - Stock-Based Compensation (Details) - Fair Value of Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Risk-free interest rate | 0.06% | 0.07% | 0.07% | 0.10% |
Expected life (in years) | '6 months | '6 months | '6 months | '178 days |
Expected volatility | 45.00% | 42.00% | 40.00% | 45.00% |
Estimated fair value (in Dollars per share) | $4.05 | $3.14 | $3.55 | $2.86 |
Note_11_StockBased_Compensatio7
Note 11 - Stock-Based Compensation (Details) - Stock-Based Compensation Expense (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Operating expenses | ' | ' | ' | ' |
Stock-Based Compensation Expense | $6,060 | $4,683 | $15,966 | $13,000 |
Cost of Sales [Member] | ' | ' | ' | ' |
Operating expenses | ' | ' | ' | ' |
Stock-Based Compensation Expense | 314 | 276 | 863 | 790 |
Research and Development Expense [Member] | ' | ' | ' | ' |
Operating expenses | ' | ' | ' | ' |
Stock-Based Compensation Expense | 3,261 | 2,446 | 8,642 | 6,675 |
Selling and Marketing Expense [Member] | ' | ' | ' | ' |
Operating expenses | ' | ' | ' | ' |
Stock-Based Compensation Expense | 1,242 | 913 | 3,040 | 2,469 |
General and Administrative Expense [Member] | ' | ' | ' | ' |
Operating expenses | ' | ' | ' | ' |
Stock-Based Compensation Expense | $1,243 | $1,048 | $3,421 | $3,066 |
Note_12_Fair_Value_Measurement2
Note 12 - Fair Value Measurements (Details) - Information about Assets and Liabilities Required to be Carried at Fair Value on Recurring Basis (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Investment in marketable securities: | ' | ' |
Total fair value of assets | $96,870 | $96,009 |
Money Market Funds [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' |
Cash equivalents: | ' | ' |
Cash equivalents | 57,320 | 5,119 |
Money Market Funds [Member] | ' | ' |
Cash equivalents: | ' | ' |
Cash equivalents | 57,320 | 5,119 |
US Treasury Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | 2,813 | 25,072 |
US Treasury Securities [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | 2,813 | 25,072 |
Municipal Bonds [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | 19,044 | 34,983 |
Municipal Bonds [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | 19,044 | 34,983 |
Corporate Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | 17,693 | 28,648 |
Corporate Debt Securities [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | 17,693 | 28,648 |
Certificates of Deposit [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | ' | 1,501 |
Certificates of Deposit [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | ' | 1,501 |
Asset-backed Securities [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | ' | 686 |
Asset-backed Securities [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Investment in marketable securities | ' | 686 |
Fair Value, Inputs, Level 1 [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Total fair value of assets | 2,813 | 25,072 |
Fair Value, Inputs, Level 2 [Member] | ' | ' |
Investment in marketable securities: | ' | ' |
Total fair value of assets | $94,057 | $70,937 |
Note_13_Segment_and_Geographic2
Note 13 - Segment and Geographic Information (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 |
Note 13 - Segment and Geographic Information (Details) [Line Items] | ' | ' |
Number of Reportable Segments | 1 | ' |
Long-Lived Tangible Assets Located Outside Country | $6,555 | $5,217 |
TAIWAN, PROVINCE OF CHINA | ' | ' |
Note 13 - Segment and Geographic Information (Details) [Line Items] | ' | ' |
Long-Lived Tangible Assets Located Outside Country | $5,169 | $4,694 |
Note_13_Segment_and_Geographic3
Note 13 - Segment and Geographic Information (Details) - Revenue by Geographic Region (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue by Geographic Region | $36,278 | $26,611 | $101,389 | $73,534 |
CHINA | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue by Geographic Region | 12,734 | 6,615 | 37,148 | 14,810 |
UNITED STATES | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue by Geographic Region | 5,983 | 3,580 | 17,831 | 15,760 |
KOREA, REPUBLIC OF | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue by Geographic Region | 1,377 | 5,570 | 6,431 | 16,781 |
JAPAN | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue by Geographic Region | 4,094 | 1,611 | 10,486 | 4,249 |
PHILIPPINES | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue by Geographic Region | 1,976 | 2,948 | 3,714 | 5,904 |
SINGAPORE | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue by Geographic Region | 1,777 | 2,969 | 6,157 | 5,868 |
Other Country [Member] | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue by Geographic Region | $8,337 | $3,318 | $19,622 | $10,162 |
Note_14_Commitments_and_Contin2
Note 14 - Commitments and Contingencies (Details) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | |||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 27, 2011 | Sep. 27, 2011 | Sep. 27, 2011 | |
Netlist Inc [Member] | Netlist Inc [Member] | |||||||
Note 14 - Commitments and Contingencies (Details) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Operating Leases, Rent Expense, Net | $1,916,000 | $1,449,000 | $5,115,000 | $4,492,000 | ' | ' | ' | ' |
Value of Open Purchase Orders | 2,821,000 | ' | 2,821,000 | ' | ' | ' | ' | ' |
Loss Contingency, Claims Dismissed, Number | ' | ' | ' | ' | ' | ' | 91 | ' |
Loss Contingency, Pending Claims, Number | ' | ' | ' | ' | ' | ' | ' | 97 |
Number of Claims Confirming Patentability Related to Action Closing Prosecution | ' | ' | ' | ' | ' | 4 | ' | ' |
Number of Claims Deemed Patentable | ' | ' | ' | ' | ' | 1 | ' | ' |
Estimated Litigation Liability | $0 | ' | $0 | ' | $0 | ' | ' | ' |
Note_14_Commitments_and_Contin3
Note 14 - Commitments and Contingencies (Details) - Future Minimum Lease Payments Under Noncancelable Operating Leases (USD $) | Sep. 30, 2014 |
In Thousands, unless otherwise specified | |
Future Minimum Lease Payments Under Noncancelable Operating Leases [Abstract] | ' |
2014 (remaining) | $1,751 |
2015 | 7,112 |
2016 | 4,268 |
2017 | 2,822 |
2018 | 1,744 |
2019 | 1,259 |
$18,956 |
Note_15_Subsequent_Event_Detai
Note 15 - Subsequent Event (Details) (Subsequent Event [Member], USD $) | 0 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Oct. 16, 2014 | Oct. 03, 2014 | Oct. 03, 2014 |
Restricted Stock Units (RSUs) [Member] | Cortina Systems, Inc. [Member] | Cortina Systems, Inc. [Member] | |
Certain Cortina Employees [Member] | |||
Note 15 - Subsequent Event (Details) [Line Items] | ' | ' | ' |
Payments to Acquire Businesses, Gross | ' | $52.70 | ' |
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | ' | 5,300,000 | ' |
Escrow Deposit | ' | ' | $16.50 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 1,000,000 | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | '4 years | ' | ' |