Cutera (CUTR) 10-Q 8 May 14 2014 Q1 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	3 Months Ended
	Mar. 31, 2014	Apr. 30, 2014
Document and Entity Information [Abstract]	'	'
Entity Registrant Name	'CUTERA INC	'
Entity Central Index Key	'0001162461	'
Current Fiscal Year End Date	'--12-31	'
Entity Well-known Seasoned Issuer	'No	'
Entity Voluntary Filers	'No	'
Entity Current Reporting Status	'Yes	'
Entity Filer Category	'Accelerated Filer	'
Entity Common Stock, Shares Outstanding	'	14,193,752
Document Fiscal Year Focus	'2014	'
Document Fiscal Period Focus	'Q1	'
Document Type	'10-Q	'
Amendment Flag	'false	'
Document Period End Date	31-Mar-14	'

CONDENSED_CONSOLIDATED_BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (USD $)	Mar. 31, 2014	Dec. 31, 2013
In Thousands, unless otherwise specified
Current assets:	'	'
Cash and cash equivalents	$10,743	$16,242
Marketable investments	73,079	66,831
Accounts receivable, net	6,588	9,679
Inventories	9,640	9,006
Deferred tax asset	31	31
Other current assets and prepaid expenses	2,404	1,507
Total current assets	102,485	103,296
Property and equipment, net	1,358	1,362
Deferred tax asset, net of current portion	337	329
Intangibles, net	1,825	2,019
Goodwill	1,339	1,339
Other long-term assets	21	324
Total assets	107,365	108,669
Current liabilities:	'	'
Accounts payable	2,483	1,820
Accrued liabilities	7,805	9,328
Deferred revenue	8,058	7,494
Total current liabilities	18,346	18,642
Deferred revenue, net of current portion	4,324	4,340
Income tax liability	118	108
Other long-term liabilities	1,200	1,314
Total liabilities	23,988	24,404
Commitments and contingencies (Note 10)	'	'
Stockholders' equity:	'	'
Convertible preferred stock, $0.001 par value; authorized: 5,000,000 shares; none issued and outstanding	0	0
Common stock, $0.001 par value; authorized: 50,000,000 shares; issued and outstanding: 14,179,834 and 13,931,833 shares at March 31, 2014 and December 31, 2013, respectively	14	14
Additional paid-in capital	101,541	98,820
Accumulated deficit	-18,230	-14,620
Accumulated other comprehensive income	52	51
Total stockholders' equity	83,377	84,265
Total liabilities and stockholders' equity	$107,365	$108,669

CONDENSED_CONSOLIDATED_BALANCE1

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Stockholders' equity:	'	'
Convertible preferred stock, par value (in dollars per share)	$0.00	$0.00
Convertible preferred stock, authorized (in shares)	5,000,000	5,000,000
Convertible preferred stock, issued (in shares)	0	0
Convertible preferred stock, outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$0.00	$0.00
Common stock, authorized (in shares)	50,000,000	50,000,000
Common stock, issued (in shares)	14,179,834	13,931,833
Common stock, outstanding (in shares)	14,179,834	13,931,833

CONDENSED_CONSOLIDATED_STATEME

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (USD $)	3 Months Ended
In Thousands, except Per Share data, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013
Net revenue:	'	'
Products	$11,752	$11,523
Service	4,437	4,444
Total net revenue	16,189	15,967
Cost of revenue:	'	'
Products	5,077	5,422
Service	2,226	1,995
Total cost of revenue	7,303	7,417
Gross profit	8,886	8,550
Operating expenses:	'	'
Sales and marketing	7,331	6,456
Research and development	2,644	2,121
General and administrative	2,564	2,289
Total operating expenses	12,539	10,866
Loss from operations	-3,653	-2,316
Interest and other income, net	80	135
Loss before income taxes	-3,573	-2,181
Provision (benefit) for income taxes	37	-18
Net loss	($3,610)	($2,163)
Net loss per share:	'	'
Basic and Diluted (in dollars per share)	($0.26)	($0.15)
Weighted-average number of shares used in per share calculations:	'	'
Basic and Diluted (in shares)	14,021	14,408

CONDENSED_CONSOLIDATED_STATEME1

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (unaudited) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (unaudited) [Abstract]	'	'
Net loss	($3,610)	($2,163)
Available-for-sale investments	'	'
Net change in unrealized gain on available-for-sale investments	2	4
Less: Reclassification adjustment for gains on investments recognized during the year	0	0
Net change in unrealized gain on available-for-sale investments	2	4
Tax provision (benefit)	1	2
Other comprehensive income, net of tax	1	2
Comprehensive loss	($3,609)	($2,161)

CONDENSED_CONSOLIDATED_STATEME2

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013
Cash flows from operating activities:	'	'
Net loss	($3,610)	($2,163)
Adjustments to reconcile net loss to net cash used in operating activities:	'	'
Stock-based compensation	625	820
Depreciation and amortization	331	320
Other	97	34
Changes in assets and liabilities:	'	'
Accounts receivable	3,091	2,027
Inventories	-634	23
Other current assets and prepaid expenses	-792	60
Other long-term assets	303	35
Accounts payable	663	54
Accrued liabilities	-1,534	-2,504
Other long-term liabilities	-70	-56
Deferred revenue	548	584
Income tax liability	10	-92
Net cash used in operating activities	-972	-858
Cash flows from investing activities:	'	'
Acquisition of property, equipment and software	-239	-174
Proceeds from sales of marketable investments	3,200	500
Proceeds from maturities of marketable investments	7,240	11,050
Purchase of marketable investments	-16,791	-20,473
Net cash used in investing activities	-6,590	-9,097
Cash flows from financing activities:	'	'
Proceeds from exercise of stock options and employee stock purchase plan	2,096	3,717
Payments on capital lease obligations	-33	-36
Net cash provided by financing activities	2,063	3,681
Net decrease in cash and cash equivalents	-5,499	-6,274
Cash and cash equivalents at beginning of period	16,242	14,020
Cash and cash equivalents at end of period	$10,743	$24,334

Summary_of_Significant_Account

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2014
Summary of Significant Accounting Policies [Abstract]	'
Summary of Significant Accounting Policies	'
	Note 1. Summary of Significant Accounting Policies
	Description of Operations and Principles of Consolidation
	Cutera, Inc. (“Cutera” or the “Company”) is a global provider of laser and other energy-based aesthetic systems for practitioners worldwide. The Company designs, develops, manufactures, and markets the CoolGlide, Xeo, Solera, GenesisPlus, Excel V, VariLite and truSculpt product platforms for use by physicians and other qualified practitioners which enable them to offer safe and effective aesthetic treatments to their customers. The Company’s products offer multiple hand pieces and applications, which allow customers to upgrade their systems. The sales of systems, hand pieces, hand piece refills, other upgrades, and the distribution of third party manufactured dermal fillers and cosmeceuticals are classified as Product revenue. In April 2014, the Company terminated its agreement with Merz Pharma GmbH’s (“Merz”) for the distribution of its Radiesse® dermal filler product. In addition to Product revenue, the Company generates Service revenue from the sale of post-warranty service contracts, providing services for products that are out of warranty.
	Headquartered in Brisbane, California, the Company has wholly-owned subsidiaries in Australia, Belgium, Canada, France, Japan and Switzerland, that market, sell and service its products outside of the United States. The Condensed Consolidated Financial Statements include the accounts of the Company and its subsidiaries. All inter-company transactions and balances have been eliminated.
	Unaudited Interim Financial Information
	The interim financial information filed is unaudited. The Condensed Consolidated Financial Statements included in this report reflect all adjustments (consisting only of normal recurring adjustments) that the Company considers necessary for the fair statement of the results of operations for the interim periods covered and of the financial condition of the Company at the date of the interim balance sheet. The December 31, 2013 Condensed Consolidated Balance Sheet was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). The results for interim periods are not necessarily indicative of the results for the entire year or any other interim period. The Condensed Consolidated Financial Statements should be read in conjunction with the Company’s previously filed audited financial statements and the notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2013 filed with the Securities and Exchange Commission (the “SEC”), on March 18, 2014.
	Use of Estimates
	The preparation of interim Condensed Consolidated Financial Statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the amounts reported and disclosed in the Condensed Consolidated Financial Statements and the accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, the Company evaluates these estimates, including those related to warranty obligation, sales commission, accounts receivable and sales allowances, provision for excess and obsolete inventories, fair values of marketable investments, fair values of acquired intangible assets, useful lives of intangible assets and property and equipment, fair value of options to purchase the Company’s stock, recoverability of deferred tax assets, and effective income tax rates, among others. Management bases these estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities.

Cash_Cash_Equivalents_and_Mark

Cash, Cash Equivalents and Marketable Investments	3 Months Ended
	Mar. 31, 2014
Cash, Cash Equivalents and Marketable Investments [Abstract]	'
Cash, Cash Equivalents and Marketable Investments	'
	Note 2. Cash, Cash Equivalents and Marketable Investments
	The Company invests its cash primarily in money market funds, commercial paper, corporate notes and bonds and U.S. government debt securities. The Company considers all highly liquid investments, with an original maturity of three months or less at the time of purchase, to be cash equivalents. Investments with maturities of greater than three months at the time of purchase are accounted for as “available-for-sale”, are carried at fair value with unrealized gains and losses reported as a component of stockholders’ equity, held for use in current operations and classified in current assets as “marketable investments”.
	The following tables summarize unrealized gains and losses related to the Company’s marketable investments, designated as available-for-sale (in thousands):
	31-Mar-14	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Market Value
	Cash and cash equivalents:
	Cash	$	2,757	$	—	$	—		$	2,757
	Money market funds		5,736		—		—			5,736
	Commercial paper		2,250		—		—			2,250
	Total cash and cash equivalents		10,743		—		—			10,743
	Marketable investments:
	U.S. government notes		17,107		14		(9	)		17,112
	U.S. government agencies		21,088		39		(1	)		21,126
	Municipal securities		2,042		4		—			2,046
	Commercial paper		14,885		5		—			14,890
	Corporate debt securities		17,854		57		(6	)		17,905
	Total marketable investments		72,976		119		(16	)		73,079
	Total cash, cash equivalents and marketable investments	$	83,719	$	119	$	(16	)	$	83,822
	31-Dec-13	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Market Value
	Cash and cash equivalents:
	Cash	$	3,816	$	—	$	—		$	3,816
	Money market funds		9,926		—		—			9,926
	Commercial paper		2,500		—		—			2,500
	Total cash and cash equivalents		16,242		—		—			16,242
	Marketable investments:
	U.S. government notes		10,516		11		(5	)		10,522
	U.S. government agencies		25,823		38		(3	)		25,858
	Municipal securities		2,043		1		(5	)		2,039
	Commercial paper		10,239		3		—			10,242
	Corporate debt securities		18,109		61		—			18,170
	Total marketable investments		66,730		114		(13	)		66,831
	Total cash, cash equivalents and marketable investments	$	82,972	$	114	$	(13	)	$	83,073
	As of March 31, 2014 and December 31, 2013, the total gross unrealized losses were $16,000 and $13,000, respectively, and were related to interest rate changes on short-term marketable investments. The Company has concluded that it is more-likely-than-not that the securities will be held until maturity or the recovery of their cost basis. No securities were in unrealized loss positions for more than 12 months.
	The following table summarizes the contractual maturities of the Company’s available-for-sale securities, classified as marketable investments as of March 31, 2014 (in thousands):
		Amount
	Due in less than one year	$	35,678
	Due in 1 to 3 years		37,401
		$	73,079

Fair_Value_of_Financial_Instru

Fair Value of Financial Instruments	3 Months Ended
	Mar. 31, 2014
Fair Value of Financial Instruments [Abstract]	'
Fair Value of Financial Instruments	'
	Note 3. Fair Value of Financial Instruments
	Fair value is defined 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 fair value hierarchy distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:
		·	Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities.
		·	Level 2: Directly or indirectly observable inputs as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data from actively quoted markets for substantially the full term of the financial instrument.
		·	Level 3: Unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions.
	In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value.
	As of March 31, 2014, financial assets measured and recognized at fair value on a recurring basis and classified under the appropriate level of the fair value hierarchy as described above were as follows (in thousands):
	March 31, 2014		Level 1		Level 2		Level 3		Total
	Cash equivalents:
	Money market funds		$	5,736	$	—	$	—	$	5,736
	Commercial paper			—		2,250		—		2,250
	Marketable investments:
	Available-for-sale securities			—		73,079		—		73,079
	Total assets at fair value		$	5,736	$	75,329	$	—	$	81,065
	As of December 31, 2013, financial assets measured and recognized at fair value on a recurring basis and classified under the appropriate level of the fair value hierarchy as described above was as follows (in thousands):
	December 31, 2013		Level 1		Level 2		Level 3		Total
	Cash equivalents:
	Money market funds		$	9,926	$	—	$	—	$	9,926
	Commercial paper			—		2,500		—		2,500
	Marketable investments:
	Available-for-sale securities			—		66,831		—		66,831
	Total assets at fair value		$	9,926	$	69,331	$	—	$	79,257
	The Company’s Level 2 investments include U.S. government-backed securities and corporate securities that are valued based upon observable inputs that may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data including market research publications. The average remaining maturity of the Company’s Level 2 investments as of March 31, 2014 is less than 36 months and all of these investments are rated by S&P and Moody’s at A or better.

Inventories

Inventories	3 Months Ended
	Mar. 31, 2014
Inventories [Abstract]	'
Inventories	'
	Note 4. Inventories
	As of March 31, 2014 and December 31, 2013, inventories consist of the following (in thousands):
		March 31,		December 31,
		2014		2013
	Raw materials	$	5,559	$	5,989
	Finished goods		4,081		3,017
	Total	$	9,640	$	9,006

Warranty

Warranty	3 Months Ended
	Mar. 31, 2014
Warranty [Abstract]	'
Warranty	'
	Note 5. Warranty
	The Company provides a standard one-year warranty on all systems. Warranty coverage provided is for labor and parts necessary to repair the systems during the warranty period. The Company accounts for the estimated warranty cost of the standard warranty coverage as a charge to costs of revenue when revenue is recognized. The estimated warranty cost is based on historical product performance. To determine the estimated warranty reserve, the Company utilizes historical service costs to calculate the expected service expense per system and applies this to the equivalent number of units exposed under warranty. The Company updates these estimated charges every quarter.
	The following table provides the changes in the product warranty accrual for the three months ended March 31, 2014 and 2013 (in thousands):
		March 31,
		2014			2013
	Beginning Balance	$	1,202		$	1,212
	Add: Accruals for warranties issued during the period		456			901
	Less: Settlements made during the period		(587	)		(1,054	)
	Ending Balance	$	1,071		$	1,059

Deferred_Service_Contract_Reve

Deferred Service Contract Revenue	3 Months Ended
	Mar. 31, 2014
Deferred Service Contract Revenue [Abstract]	'
Deferred Service Contract Revenue	'
	Note 6. Deferred Service Contract Revenue
	The Company generates Service revenue from the sale of extended service contracts and from time and material services provided to customers who are not under a warranty or extended service contract. Service contract revenue is recognized on a straight-line basis over the period of the applicable contract. Service revenue, from customers whose systems are not under a service contract, is recognized as the services are provided.
	The following table provides changes in the deferred service contract revenue balance for the three-month periods ended March 31, 2014 and 2013 (in thousands):
		March 31,
		2014			2013
	Beginning Balance	$	11,637		$	8,539
	Add: Payments received		3,711			3,602
	Less: Revenue recognized		(3,056	)		(2,990	)
	Ending Balance	$	12,292		$	9,151
	Costs for extended service contracts were $1.7 million for both of the three months ended March 31, 2014 and 2013.

Stockholders_Equity_and_Stockb

Stockholders' Equity and Stock-based Compensation Expense	3 Months Ended
	Mar. 31, 2014
Stockholders' Equity and Stock-based Compensation Expense [Abstract]	'
Stockholders' Equity and Stock-based Compensation Expense	'
	Note 7. Stockholders’ Equity and Stock-based Compensation Expense
	Stock-based Compensation Expense
	Stock-based compensation expense by department recognized during the three months ended March 31, 2014 and 2013 were as follows (in thousands):
		Three Months Ended March 31,
		2014			2013
	Cost of revenue		$	132		$	159
	Sales and marketing			71			199
	Research and development			124			101
	General and administrative			298			361
	Total stock-based compensation expense		$	625		$	820
	Under the 2004 Equity Incentive Plan, the Company issued 248,001 shares of common stock during the three months ended March 31, 2014, in conjunction with stock options exercised.
	During the three months ended March 31, 2014, the following number of equity awards of the Company’s common stock was granted (in thousands):
			Shares
	Stock options			132
	Restricted stock units			5
	Total			137
	As of March 31, 2014, there was $3.5 million of unrecognized compensation expense, net of projected forfeitures related to non-vested stock awards. The expense is expected to be recognized over the remaining weighted-average period of 2.5 years.

Net_Loss_Per_Share

Net Loss Per Share	3 Months Ended
	Mar. 31, 2014
Net Loss Per Share [Abstract]	'
Net Loss Per Share	'
	Note 8. Net Loss Per Share
	Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the year. Diluted net loss per common share is the same as basic net loss per common share, as the effect of the potential common stock equivalents is anti-dilutive and as such is excluded from the calculations of the diluted net loss per share.
	The following numbers of shares outstanding, prior to the application of the treasury stock method, were excluded from the computation of diluted net loss per common share for the periods presented – because including them would have had an anti-dilutive effect (in thousands):
		Three Months Ended March 31,
		2014		2013
	Options to purchase common stock		3,693		3,738
	Restricted stock units		170		149
	Performance stock units		5		—
	Employee stock purchase plan shares		21		32
	Total		3,889		3,919

Income_Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2014
Income Taxes [Abstract]	'
Income Taxes	'
	Note 9. Income Taxes
	The Company’s quarterly income taxes reflect an estimate of the corresponding year’s annual effective tax rate and include, when applicable, adjustments from discrete tax items. For the three months ended March 31, 2014 and 2013, the Company’s tax expense was $37,000 and tax benefit was $18,000 respectively, and was primarily related to income taxes of the Company’s non-U.S. operations. In addition, included in the tax provision for the three months ended March 31, 2013, was a benefit resulting from the release of uncertain tax position liabilities due to statutes lapsing.
	The Company utilizes the asset and liability method of accounting for income taxes, under which deferred taxes are determined based on the temporary differences between the financial statement and tax basis of assets and liabilities using tax rates expected to be in effect during the years in which the basis differences reverse. A valuation allowance is recorded when it is more likely than not that some of the deferred tax assets will not be realized. As of March 31, 2014 and December 31, 2013, the Company had a 100% valuation allowance against its U.S. deferred tax assets. Significant management judgment is required in determining any valuation allowance recorded against deferred tax assets. In evaluating the ability to recover deferred tax assets, the Company considered available positive and negative evidence giving greater weight to its recent cumulative losses and its ability to carry-back losses against prior taxable income and lesser weight to its projected financial results due to the challenges of forecasting future periods. The Company also considered, commensurate with its objective verifiability, the forecast of future taxable income including the reversal of temporary differences and the implementation of feasible and prudent tax planning strategies.

Commitments_and_Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2014
Commitments and Contingencies [Abstract]	'
Commitments and Contingencies	'
	Note 10. Commitments and Contingencies
	Litigation and Litigation Settlements
	The Company is named from time to time as a party to product liability and contractual lawsuits in the normal course of business. The Company routinely assesses the likelihood of any adverse judgments or outcomes related to legal matters and claims, as well as ranges of probable losses. A determination of the amount of the reserves required, if any, for these contingencies is made after analysis of each known issue, historical experience, whether it is more likely than not that the Company shall incur a loss, and whether the loss is estimable. As of March 31, 2014, the Company had accrued approximately $0.1 million related to pending product liability and contractual lawsuits.

Summary_of_Significant_Account1

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2014
Summary of Significant Accounting Policies [Abstract]	'
Description of Operations and Principles of Consolidation	'
	Description of Operations and Principles of Consolidation
	Cutera, Inc. (“Cutera” or the “Company”) is a global provider of laser and other energy-based aesthetic systems for practitioners worldwide. The Company designs, develops, manufactures, and markets the CoolGlide, Xeo, Solera, GenesisPlus, Excel V, VariLite and truSculpt product platforms for use by physicians and other qualified practitioners which enable them to offer safe and effective aesthetic treatments to their customers. The Company’s products offer multiple hand pieces and applications, which allow customers to upgrade their systems. The sales of systems, hand pieces, hand piece refills, other upgrades, and the distribution of third party manufactured dermal fillers and cosmeceuticals are classified as Product revenue. In April 2014, the Company terminated its agreement with Merz Pharma GmbH’s (“Merz”) for the distribution of its Radiesse® dermal filler product. In addition to Product revenue, the Company generates Service revenue from the sale of post-warranty service contracts, providing services for products that are out of warranty.
	Headquartered in Brisbane, California, the Company has wholly-owned subsidiaries in Australia, Belgium, Canada, France, Japan and Switzerland, that market, sell and service its products outside of the United States. The Condensed Consolidated Financial Statements include the accounts of the Company and its subsidiaries. All inter-company transactions and balances have been eliminated.
Unaudited Interim Financial Information	'
	Unaudited Interim Financial Information
	The interim financial information filed is unaudited. The Condensed Consolidated Financial Statements included in this report reflect all adjustments (consisting only of normal recurring adjustments) that the Company considers necessary for the fair statement of the results of operations for the interim periods covered and of the financial condition of the Company at the date of the interim balance sheet. The December 31, 2013 Condensed Consolidated Balance Sheet was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). The results for interim periods are not necessarily indicative of the results for the entire year or any other interim period. The Condensed Consolidated Financial Statements should be read in conjunction with the Company’s previously filed audited financial statements and the notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2013 filed with the Securities and Exchange Commission (the “SEC”), on March 18, 2014.
Use of Estimates	'
	Use of Estimates
	The preparation of interim Condensed Consolidated Financial Statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the amounts reported and disclosed in the Condensed Consolidated Financial Statements and the accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, the Company evaluates these estimates, including those related to warranty obligation, sales commission, accounts receivable and sales allowances, provision for excess and obsolete inventories, fair values of marketable investments, fair values of acquired intangible assets, useful lives of intangible assets and property and equipment, fair value of options to purchase the Company’s stock, recoverability of deferred tax assets, and effective income tax rates, among others. Management bases these estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities.

Cash_Cash_Equivalents_and_Mark1

Cash, Cash Equivalents and Marketable Investments (Tables)	3 Months Ended
	Mar. 31, 2014
Cash, Cash Equivalents and Marketable Investments [Abstract]	'
Unrealized gains and losses related to marketable investments and long-term investments	'
	The following tables summarize unrealized gains and losses related to the Company’s marketable investments, designated as available-for-sale (in thousands):
	31-Mar-14	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Market Value
	Cash and cash equivalents:
	Cash	$	2,757	$	—	$	—		$	2,757
	Money market funds		5,736		—		—			5,736
	Commercial paper		2,250		—		—			2,250
	Total cash and cash equivalents		10,743		—		—			10,743
	Marketable investments:
	U.S. government notes		17,107		14		(9	)		17,112
	U.S. government agencies		21,088		39		(1	)		21,126
	Municipal securities		2,042		4		—			2,046
	Commercial paper		14,885		5		—			14,890
	Corporate debt securities		17,854		57		(6	)		17,905
	Total marketable investments		72,976		119		(16	)		73,079
	Total cash, cash equivalents and marketable investments	$	83,719	$	119	$	(16	)	$	83,822
	31-Dec-13	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Market Value
	Cash and cash equivalents:
	Cash	$	3,816	$	—	$	—		$	3,816
	Money market funds		9,926		—		—			9,926
	Commercial paper		2,500		—		—			2,500
	Total cash and cash equivalents		16,242		—		—			16,242
	Marketable investments:
	U.S. government notes		10,516		11		(5	)		10,522
	U.S. government agencies		25,823		38		(3	)		25,858
	Municipal securities		2,043		1		(5	)		2,039
	Commercial paper		10,239		3		—			10,242
	Corporate debt securities		18,109		61		—			18,170
	Total marketable investments		66,730		114		(13	)		66,831
	Total cash, cash equivalents and marketable investments	$	82,972	$	114	$	(13	)	$	83,073
Estimated fair value of marketable investments and long-term investments classified by contractual maturity date	'
	The following table summarizes the contractual maturities of the Company’s available-for-sale securities, classified as marketable investments as of March 31, 2014 (in thousands):
		Amount
	Due in less than one year	$	35,678
	Due in 1 to 3 years		37,401
		$	73,079

Fair_Value_of_Financial_Instru1

Fair Value of Financial Instruments (Tables)	3 Months Ended
	Mar. 31, 2014
Fair Value of Financial Instruments [Abstract]	'
Financial assets measured and recognized at fair value on a recurring basis and classified under appropriate level of fair value hierarchy	'
	As of March 31, 2014, financial assets measured and recognized at fair value on a recurring basis and classified under the appropriate level of the fair value hierarchy as described above were as follows (in thousands):
	March 31, 2014	Level 1		Level 2		Level 3		Total
	Cash equivalents:
	Money market funds	$	5,736	$	—	$	—	$	5,736
	Commercial paper		—		2,250		—		2,250
	Marketable investments:
	Available-for-sale securities		—		73,079		—		73,079
	Total assets at fair value	$	5,736	$	75,329	$	—	$	81,065
	As of December 31, 2013, financial assets measured and recognized at fair value on a recurring basis and classified under the appropriate level of the fair value hierarchy as described above was as follows (in thousands):
	December 31, 2013	Level 1		Level 2		Level 3		Total
	Cash equivalents:
	Money market funds	$	9,926	$	—	$	—	$	9,926
	Commercial paper		—		2,500		—		2,500
	Marketable investments:
	Available-for-sale securities		—		66,831		—		66,831
	Total assets at fair value	$	9,926	$	69,331	$	—	$	79,257

Inventories_Tables

Inventories (Tables)	3 Months Ended
	Mar. 31, 2014
Inventories [Abstract]	'
Inventories	'
	As of March 31, 2014 and December 31, 2013, inventories consist of the following (in thousands):
		March 31,		December 31,
		2014		2013
	Raw materials	$	5,559	$	5,989
	Finished goods		4,081		3,017
	Total	$	9,640	$	9,006

Warranty_Tables

Warranty (Tables)	3 Months Ended
	Mar. 31, 2014
Warranty [Abstract]	'
Changes in product warranty accrual	'
	The following table provides the changes in the product warranty accrual for the three months ended March 31, 2014 and 2013 (in thousands):
		March 31,
		2014			2013
	Beginning Balance	$	1,202		$	1,212
	Add: Accruals for warranties issued during the period		456			901
	Less: Settlements made during the period		(587	)		(1,054	)
	Ending Balance	$	1,071		$	1,059

Deferred_Service_Contract_Reve1

Deferred Service Contract Revenue (Tables)	3 Months Ended
	Mar. 31, 2014
Deferred Service Contract Revenue [Abstract]	'
Changes in deferred service contract revenue	'
	The following table provides changes in the deferred service contract revenue balance for the three-month periods ended March 31, 2014 and 2013 (in thousands):
		March 31,
		2014			2013
	Beginning Balance	$	11,637		$	8,539
	Add: Payments received		3,711			3,602
	Less: Revenue recognized		(3,056	)		(2,990	)
	Ending Balance	$	12,292		$	9,151

Stockholders_Equity_and_Stockb1

Stockholders' Equity and Stock-based Compensation Expense (Tables)	3 Months Ended
	Mar. 31, 2014
Stockholders' Equity and Stock-based Compensation Expense [Abstract]	'
Stock-based compensation expense by department	'
	Stock-based compensation expense by department recognized during the three months ended March 31, 2014 and 2013 were as follows (in thousands):
		Three Months Ended March 31,
		2014			2013
	Cost of revenue		$	132		$	159
	Sales and marketing			71			199
	Research and development			124			101
	General and administrative			298			361
	Total stock-based compensation expense		$	625		$	820
Schedule of equity awards granted	'
	During the three months ended March 31, 2014, the following number of equity awards of the Company’s common stock was granted (in thousands):
			Shares
	Stock options			132
	Restricted stock units			5
	Total			137

Net_Loss_Per_Share_Tables

Net Loss Per Share (Tables)	3 Months Ended
	Mar. 31, 2014
Net Loss Per Share [Abstract]	'
Antidilutive securities excluded from the computation of diluted net loss per common share	'
	The following numbers of shares outstanding, prior to the application of the treasury stock method, were excluded from the computation of diluted net loss per common share for the periods presented – because including them would have had an anti-dilutive effect (in thousands):
		Three Months Ended March 31,
		2014		2013
	Options to purchase common stock		3,693		3,738
	Restricted stock units		170		149
	Performance stock units		5		—
	Employee stock purchase plan shares		21		32
	Total		3,889		3,919

Cash_Cash_Equivalents_and_Mark2

Cash, Cash Equivalents and Marketable Investments (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
In Thousands, unless otherwise specified
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	$83,719	$82,972
Gross Unrealized Gains	119	114
Gross Unrealized Losses	-16	-13
Fair Market Value	83,822	83,073
Estimated fair value of marketable investments and long-term investments classified by contractual maturity date [Abstract]	'	'
Due in less than one year	35,678	'
Due in 1 to 3 years	37,401	'
Total	73,079	'
U.S. Government Notes [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	17,107	10,516
Gross Unrealized Gains	14	11
Gross Unrealized Losses	-9	-5
Fair Market Value	17,112	10,522
U.S. Government Agencies [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	21,088	25,823
Gross Unrealized Gains	39	38
Gross Unrealized Losses	-1	-3
Fair Market Value	21,126	25,858
Municipal Securities [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	2,042	2,043
Gross Unrealized Gains	4	1
Gross Unrealized Losses	0	-5
Fair Market Value	2,046	2,039
Commercial Paper [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	14,885	10,239
Gross Unrealized Gains	5	3
Gross Unrealized Losses	0	0
Fair Market Value	14,890	10,242
Corporate Debt Securities [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	17,854	18,109
Gross Unrealized Gains	57	61
Gross Unrealized Losses	-6	0
Fair Market Value	17,905	18,170
Cash [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	2,757	3,816
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Market Value	2,757	3,816
Money Market Funds [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	5,736	9,926
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Market Value	5,736	9,926
Commercial Paper [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	2,250	2,500
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Market Value	2,250	2,500
Total Cash and Cash Equivalents [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	10,743	16,242
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Market Value	10,743	16,242
Total Marketable Investments [Member]	'	'
Cash, cash equivalents and marketable investments [Abstract]	'	'
Amortized Cost	72,976	66,730
Gross Unrealized Gains	119	114
Gross Unrealized Losses	-16	-13
Fair Market Value	$73,079	$66,831

Fair_Value_of_Financial_Instru2

Fair Value of Financial Instruments (Details) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Assets, Fair Value Disclosure [Abstract]	'	'
Total assets at fair value	$83,822	$83,073
Fair Value, Measurements, Recurring [Member]	'	'
Assets, Fair Value Disclosure [Abstract]	'	'
Total assets at fair value	81,065	79,257
Cash equivalents [Abstract]	'	'
Money market funds	5,736	9,926
Commercial paper	2,250	2,500
Marketable investments [Abstract]	'	'
Available for sale securities	73,079	66,831
Fair Value, Measurements, Recurring [Member] | Level 1 [Member]	'	'
Assets, Fair Value Disclosure [Abstract]	'	'
Total assets at fair value	5,736	9,926
Cash equivalents [Abstract]	'	'
Money market funds	5,736	9,926
Commercial paper	0	0
Marketable investments [Abstract]	'	'
Available for sale securities	0	0
Fair Value, Measurements, Recurring [Member] | Level 2 [Member]	'	'
Assets, Fair Value Disclosure [Abstract]	'	'
Total assets at fair value	75,329	69,331
Cash equivalents [Abstract]	'	'
Money market funds	0	0
Commercial paper	2,250	2,500
Marketable investments [Abstract]	'	'
Available for sale securities	73,079	66,831
Maximum maturity period of investments	'36 months	'
Fair Value, Measurements, Recurring [Member] | Level 3 [Member]	'	'
Assets, Fair Value Disclosure [Abstract]	'	'
Total assets at fair value	0	0
Cash equivalents [Abstract]	'	'
Money market funds	0	0
Commercial paper	0	0
Marketable investments [Abstract]	'	'
Available for sale securities	$0	$0

Inventories_Details

Inventories (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
In Thousands, unless otherwise specified
Inventories [Abstract]	'	'
Raw materials	$5,559	$5,989
Finished goods	4,081	3,017
Total	$9,640	$9,006

Warranty_Details

Warranty (Details) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013
Warranty [Abstract]	'	'
Period of warranty	'1 year	'
Changes in product warranty accrual [Roll forward]	'	'
Beginning Balance	$1,202	$1,212
Add: Accruals for warranties issued during the period	456	901
Less: Settlements made during the period	-587	-1,054
Ending Balance	$1,071	$1,059

Deferred_Service_Contract_Reve2

Deferred Service Contract Revenue (Details) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Changes in deferred service contract revenue [Roll forward]	'	'
Beginning Balance	$11,637,000	$8,539,000
Add: Payments received	3,711,000	3,602,000
Less: Revenue recognized	-3,056,000	-2,990,000
Ending Balance	12,292,000	9,151,000
Service Contract [Member]	'	'
Changes in deferred service contract revenue [Roll forward]	'	'
Costs incurred under service contracts	$1,700,000	$1,700,000

Stockholders_Equity_and_Stockb2

Stockholders' Equity and Stock-based Compensation Expense (Details) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Employee Service Share-based Compensation, Allocation of Recognized Period Costs and Stock repurchase program [Line Items]	'	'
Stock-based compensation expense	$625,000	$820,000
Number of shares of common stock issued (in shares)	248,001	'
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]	'	'
Number of shares of common stock granted (in shares)	137,000	'
Unrecognized compensation expense, net of projected forfeitures	3,500,000	'
Period for Recognition	'2 years 6 months	'
Stock Options [Member]	'	'
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]	'	'
Number of shares of common stock granted (in shares)	132,000	'
Restricted Stock Units [Member]	'	'
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]	'	'
Number of shares of common stock granted (in shares)	5,000	'
Cost of Revenue [Member]	'	'
Employee Service Share-based Compensation, Allocation of Recognized Period Costs and Stock repurchase program [Line Items]	'	'
Stock-based compensation expense	132,000	159,000
Sales and Marketing [Member]	'	'
Employee Service Share-based Compensation, Allocation of Recognized Period Costs and Stock repurchase program [Line Items]	'	'
Stock-based compensation expense	71,000	199,000
Research and Development [Member]	'	'
Employee Service Share-based Compensation, Allocation of Recognized Period Costs and Stock repurchase program [Line Items]	'	'
Stock-based compensation expense	124,000	101,000
General and Administrative [Member]	'	'
Employee Service Share-based Compensation, Allocation of Recognized Period Costs and Stock repurchase program [Line Items]	'	'
Stock-based compensation expense	$298,000	$361,000

Net_Loss_Per_Share_Details

Net Loss Per Share (Details)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]	'	'
Antidilutive securities excluded from computation of diluted net loss per common share (in shares)	3,889	3,919
Options to Purchase Common Stock [Member]	'	'
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]	'	'
Antidilutive securities excluded from computation of diluted net loss per common share (in shares)	3,693	3,738
Restricted Stock Units [Member]	'	'
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]	'	'
Antidilutive securities excluded from computation of diluted net loss per common share (in shares)	170	149
Performance Stock Units [Member]	'	'
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]	'	'
Antidilutive securities excluded from computation of diluted net loss per common share (in shares)	5	0
Employee Stock Purchase Plan Shares [Member]	'	'
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]	'	'
Antidilutive securities excluded from computation of diluted net loss per common share (in shares)	21	32

Income_Taxes_Details

Income Taxes (Details) (USD $)	3 Months Ended		12 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Income Taxes [Abstract]	'	'	'
Income tax expense (provision)	$37	($18)	'
Deferred tax assets, valuation allowance, percentage (in hundredths)	100.00%	'	100.00%

Commitments_and_Contingencies_

Commitments and Contingencies (Details) (USD $)	Mar. 31, 2014
In Millions, unless otherwise specified
Commitments and Contingencies [Abstract]	'
Estimated litigation liability	$0.10