Luna Innovations (LUNA) 10-Q 13 May 19 2019 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 09, 2019
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1
Trading Symbol	LUNA
Entity Registrant Name	LUNA INNOVATIONS INC
Entity Central Index Key	0001239819
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Common Stock, Shares Outstanding		28,146,213

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 24,580,006	$ 42,460,267
Accounts receivable, net	13,505,444	13,037,068
Receivable from sale of HSOR business	2,500,375	2,500,000
Contract assets	2,829,186	2,422,495
Inventory	9,996,054	6,873,742
Prepaid expenses and other current assets	1,087,416	935,185
Total current assets	54,498,481	68,228,757
Long-term contract assets	359,166	336,820
Property and equipment, net	3,845,748	3,627,886
Intangible assets, net	11,309,181	3,302,270
Goodwill	10,345,249	101,008
Other assets, net	3,205,983	1,995
Total assets	83,563,808	75,598,736
Current liabilities:
Current portion of long-term debt obligations	247,726	619,315
Current portion of capital lease obligations	0	40,586
Accounts payable	4,945,927	2,395,984
Accrued liabilities	8,599,225	6,597,458
Contract liabilities	2,792,119	2,486,111
Total current liabilities	16,584,997	12,139,454
Long-term deferred rent	0	1,035,974
Other long-term liabilities	2,970,879	0
Long-term capital lease obligations	0	68,978
Total liabilities	19,555,876	13,244,406
Commitments and contingencies
Stockholders’ equity:
Preferred stock, par value $0.001, 1,321,514 shares authorized, issued and outstanding at March 31, 2019 and December 31, 2018	1,322	1,322
Common stock, par value $0.001, 100,000,000 shares authorized, 29,398,818 and 29,209,506 shares issued, 28,145,713 and 27,956,401 shares outstanding at March 31, 2019 and December 31, 2018, respectively	30,329	30,120
Treasury stock at cost, 1,253,105 shares at March 31, 2019 and December 31, 2018	(2,116,640)	(2,116,640)
Additional paid-in capital	86,355,322	85,744,750
Accumulated deficit	(20,262,401)	(21,305,222)
Total stockholders’ equity	64,007,932	62,354,330
Total liabilities and stockholders’ equity	$ 83,563,808	$ 75,598,736

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized (in shares)	1,321,514	1,321,514
Preferred stock, issued (in shares)	1,321,514	1,321,514
Preferred stock, outstanding (in shares)	1,321,514	1,321,514
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized (in shares)	100,000,000	100,000,000
Common stock, issued (in shares)	29,398,818	29,209,506
Common stock, outstanding (in shares)	28,145,713	27,956,401
Treasury Stock (in shares)	1,253,105	1,253,105

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenues:
Total revenues	$ 14,833,118	$ 8,768,530
Cost of revenues:
Total cost of revenues	8,065,484	4,928,904
Gross profit	6,767,634	3,839,626
Operating expense:
Selling, general and administrative	6,207,318	3,333,490
Research, development and engineering	1,457,893	879,592
Total operating expense	7,665,211	4,213,082
Operating loss	(897,577)	(373,456)
Other income/(expense):
Investment income	171,225	75,912
Other expense	(1,729)	(10,854)
Interest expense	(11,187)	(40,647)
Total other income	158,309	24,411
Loss from continuing operations before income taxes	(739,268)	(349,045)
Income tax benefit	(1,865,147)	(76,967)
Net income/(loss) from continuing operations	1,125,879	(272,078)
Income from discontinued operations, net of income tax of $0 and $78,363	0	420,754
Net income from discontinued operations	0	420,754
Net income	1,125,879	148,676
Preferred stock dividend	83,058	64,425
Net income attributable to common stockholders	$ 1,042,821	$ 84,251
Net income/(loss) per share from continuing operations:
Basic (in dollars per share)	$ 0.04	$ (0.01)
Diluted (in dollars per share)	0.03	(0.01)
Net income per share from discontinued operations:
Basic (in dollars per share)	0	0.02
Diluted (in dollars per share)	0	0.02
Net income per share attributable to common stockholders:
Basic (in dollars per share)	0.04	0
Diluted (in dollars per share)	$ 0.03	$ 0
Weighted average common shares and common equivalent shares outstanding:
Basic (in shares)	28,039,080	27,204,989
Diluted (in shares)	33,479,935	27,204,989
Technology development
Revenues:
Total revenues	$ 6,640,743	$ 4,636,776
Cost of revenues:
Total cost of revenues	4,816,146	3,353,501
Products and licensing
Revenues:
Total revenues	8,192,375	4,131,754
Cost of revenues:
Total cost of revenues	$ 3,249,338	$ 1,575,403

Consolidated Statements of Op_2

Consolidated Statements of Operations (Parenthetical) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Statement [Abstract]
Allocated tax expense	$ 0	$ 78,363

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Cash flows provided by/(used in) operating activities
Net income	$ 1,125,879	$ 148,676
Adjustments to reconcile net income to net cash provided by/(used in) operating activities
Depreciation and amortization	617,309	307,852
Share-based compensation	342,765	94,606
Deferred taxes	(1,889,266)	0
Change in assets and liabilities
Accounts receivable	1,052,571	(229,535)
Contract assets	(429,037)	221,386
Inventory	(527,849)	(110,095)
Other current assets	(41,549)	133,293
Accounts payable and accrued expenses	1,196,425	(1,456,154)
Contract liabilities	149,435	(1,650,363)
Net cash provided by/(used in) operating activities	1,596,683	(2,540,334)
Cash flows used in investing activities
Acquisition of property and equipment	(215,251)	(129,720)
Intangible property costs	(60,639)	(113,108)
Acquisition of General Photonics Corporation	(19,004,250)	0
Net cash used in investing activities	(19,280,140)	(242,828)
Cash flows used in financing activities
Payments on finance lease obligations	(6,763)	(13,611)
Payments of debt obligations	(375,000)	(458,333)
Repurchase of common stock	0	(306,041)
Proceeds from the exercise of options and warrants	184,959	22,288
Net cash used in financing activities	(196,804)	(755,697)
Net decrease in cash and cash equivalents	(17,880,261)	(3,538,859)
Cash and cash equivalents—beginning of period	42,460,267	36,981,533
Cash and cash equivalents—end of period	24,580,006	33,442,674
Supplemental disclosure of cash flow information
Cash paid for interest	12,062	39,071
Cash paid for income taxes	0	1,396
Non-cash investing and financing activities
Contingent liability for business combination	900,000	0
Dividend on preferred stock, 19,823 shares of common stock issuable	$ 83,058	$ 64,425

Consolidated Statements of Ca_2

Consolidated Statements of Cash Flows (Parenthetical) - shares	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Statement of Cash Flows [Abstract]
Dividend on preferred stock, shares of common stock issuable (in shares)	19,823	19,823

Basis of Presentation and Signi

Basis of Presentation and Significant Accounting Policies	3 Months Ended
	Mar. 31, 2019
Accounting Policies [Abstract]
Basis of Presentation and Significant Accounting Policies	Basis of Presentation and Significant Accounting Policies Nature of Operations Luna Innovations Incorporated (“we,” “Luna Innovations” or the “Company”), headquartered in Roanoke, Virginia, was incorporated in the Commonwealth of Virginia in 1990 and reincorporated in the State of Delaware in April 2003. We are a leader in advanced optical technology, providing high performance fiber optic test products for the telecommunications industry and distributed fiber optic sensing products for industries utilizing composite and other advanced materials, such as the automotive, aerospace, energy and infrastructure industries. Our distributed fiber optic sensing products help designers and manufacturers more efficiently develop new and innovative products by providing valuable information such as highly detailed stress, strain, and temperature measurements of a new design or manufacturing process. In addition, our distributed fiber optic sensing products are used to monitor the structural integrity or operational health of critical assets, including large civil structures such as bridges. Our communications test products accelerate the development of advanced fiber optic components and networks by providing fast and highly accurate characterization of components and networks. We also provide applied research services, typically under research programs funded by the U.S. government, in areas of advanced materials, sensing, and healthcare applications. Our business model is designed to accelerate the process of bringing new and innovative products to market. We use our in-house technical expertise across a range of technologies to perform applied research services for companies and for government funded projects. We continue to invest in product development and commercialization, which we anticipate will lead to increased product sales growth. Unaudited Interim Financial Information The accompanying unaudited consolidated interim financial statements have been prepared in accordance with accounting principles generally accepted in the United Stated of America (“U.S. GAAP”) for interim financial statements and Article 10 of Regulation S-X of the Securities Exchange Act of 1934, as amended. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. The unaudited consolidated interim financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management reflect all adjustments, consisting of only normal recurring accruals considered necessary to present fairly our financial position at March 31, 2019 , results of operations for the three months ended March 31, 2019 and 2018 , and cash flows for the three months ended March 31, 2019 and 2018 . The results of operations for the three months ended March 31, 2019 , are not necessarily indicative of the results that may be expected for the year ending December 31, 2019 . The consolidated balance sheet as of December 31, 2018 was derived from our audited consolidated financial statements. The consolidated interim financial statements, including our significant accounting policies, should be read in conjunction with the audited Consolidated Financial Statements and the notes thereto for the year ended December 31, 2018 , included in our Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on March 15, 2019 . Business Combinations We apply the provisions of Accounting Standards Codification ("ASC") 805, Business Combinations , in the accounting for acquisitions. ASC 805 requires us to recognize separately from goodwill the assets acquired and the liabilities assumed at their acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net of the acquisition date fair values of the assets acquired and the liabilities assumed. While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date as well as contingent consideration, where applicable, these estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of the assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in our consolidated statements of operations. Accounting for business combinations requires management to make significant estimates and assumptions, especially at the acquisition date, including estimates for intangible assets, contractual obligations assumed, restructuring liabilities, pre-acquisition contingencies and contingent consideration, where applicable. Although we believe the assumptions and estimates we have made have been reasonable and appropriate, they are based in part on historical experience and information obtained from management of the acquired companies and are inherently uncertain. Critical estimates in valuing certain of the intangible assets we have acquired include: future expected cash flows from product sales; customer contracts and acquired technologies; expected costs to develop in-process research and development into commercially viable products and estimated cash flows from the projects when completed; and discount rates. Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates, or actual results. Goodwill and Intangible Assets Goodwill and intangible assets with indefinite lives are not amortized but are tested for impairment on an annual basis, as of October 1 of each year, or whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. Purchased intangible assets with finite useful lives are amortized using the straight-line method over their estimated useful lives and reviewed for impairment as described above. Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between marketplace participants. Various valuation approaches can be used to determine fair value, each requiring different valuation inputs. The following hierarchy classifies the inputs used to determine fair value into three levels: • Level 1—Quoted prices for identical instruments in active markets • Level 2—Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets • Level 3—Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short-term nature of these instruments. The carrying value of our debt approximates fair value, as we consider the floating interest rate on our credit facilities with Silicon Valley Bank ("SVB") to be at market for similar instruments. Certain non-financial assets and liabilities are measured at fair value on a nonrecurring basis in accordance with U.S. GAAP. This includes items such as non-financial assets and liabilities initially measured at fair value in a business combination and non-financial long-lived asset groups measured at fair value for an impairment assessment. In general, non-financial assets including intangible assets and property and equipment are measured at fair value when there is an indication of impairment and are recorded at fair value only when any impairment is recognized. Net Income/(Loss) Per Share Basic per share data is computed by dividing our net income/(loss) by the weighted average number of shares outstanding during the period. Diluted per share data is computed by dividing net income/(loss), if applicable, by the weighted average shares outstanding during the period increased to include, if dilutive, the number of additional common share equivalents that would have been outstanding if potential shares of common stock had been issued using the treasury stock method. Diluted per share data would also include the potential common share equivalents relating to convertible securities by application of the if-converted method. The effects of 5.4 million common stock equivalents (which include outstanding warrant, preferred stock and stock options) are included for the diluted per share data for three months ended March 31, 2019 . The effects of 4.0 million common stock equivalents are not included for the three months ended March 31, 2018 , as they are anti-dilutive to earnings per share due to our net loss from continuing operations. Recently Issued Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued a new standard related to Leases, Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842) and subsequent amendments, which replaced existing GAAP and requires lessees to recognize right-of-use ("ROU") assets and lease liabilities on the balance sheet for those leases classified as operating leases for greater transparency. The Company, using a modified retrospective adoption approach, is required to recognize and measure leases existing at the beginning of the adoption period, with certain practical expedients available. The Company adopted the standard effective January 1, 2019. The standard allows a number of optional practical expedients to use for transition. The Company choose the certain practical expedients allowed under the transition guidance which permitted us to not to reassess any existing or expired contracts to determine if they contain embedded leases, to not to reassess our lease classification on existing leases, to account for lease and non-lease components as a single lease component for equipment leases, and whether initial direct costs previously capitalized would qualify for capitalization under FASB ASC 842. The new standard also provides practical expedients and recognition exemptions for an entity's ongoing accounting policy elections. The Company has elected the short-term lease recognition for all leases that qualify, which means that we do not recognize a ROU asset and lease liability for any lease with a term of twelve months or less. The most significant impact of adopting the standard was the recognition of ROU assets and lease liabilities for operating leases on the Company's consolidated balance sheet but it did not have an impact on the Company's consolidated statements of operations or consolidated statements of cash flows. The cumulative effect of the changes made to our January 1, 2019 unaudited consolidated balance sheet as a result of the adoption of ASC 842 are as follows: Balance at Adjustment for Adjusted balance at December 31, 2018 ASC 842 January 1, 2019 Assets: Property and equipment, net 3,627,886 (26,004 ) 3,601,882 Other assets, net 1,995 3,471,643 3,473,638 Liabilities: Accrued liabilities 6,597,458 1,242,669 7,840,127 Current portion of capital lease obligations 40,586 (40,586 ) — Long-term deferred rent 1,035,974 (1,035,974 ) — Long-term operating lease liability — 3,271,705 3,271,705 Long-term capital lease obligations 68,978 (68,978 ) — Long-term finance lease liability — 76,803 76,803 Effective January 1, 2018, we adopted ASU No. 2016-15, Statement of Cash Flows (Topic 230) , which addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice in how cash receipts and cash payments are presented in the statement of cash flows. The adoption of ASU No. 2016-15 did not have a significant impact on our consolidated financial statements. In February 2018, the FASB issued ASU 2018-02: Income Statement – Reporting Comprehensive Income (Topic 220) . Under current accounting guidance, the income tax effects for changes in income tax rates and certain other transactions are recognized in income from continuing operations resulting in income tax effects recognized in accumulated other comprehensive income that do not reflect the current tax rate of the entity (“stranded tax effects”). The new guidance allows us the option to reclassify these stranded tax effects to accumulated deficit that relate to the change in the federal tax rate resulting from the passage of the Tax Cuts and Jobs Act. This update is effective for fiscal years beginning after December 15, 2018, including interim periods therein, and early adoption is permitted. We do not expect the adoption of this standard will have a significant impact on our consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Changes to the Disclosure Requirements for Fair Value Measurement. which amends the disclosure requirements in ASC 820 by adding, changing, or removing certain disclosures. The ASU applies to all entities that are required under this guidance to provide disclosures about recurring or nonrecurring fair value measurements. These amendments are effective for all entities for fiscal years beginning after December 15, 2019 including interim periods within those fiscal years. We do not expect ASU 2018-13 will have a material impact on our consolidated financial statements.

Business Combinations

Business Combinations	3 Months Ended
	Mar. 31, 2019
Business Combinations [Abstract]
Business Combinations	Business Combinations On October 15, 2018, we acquired substantially all of the assets, other than cash, of the United States operations of Micron Optics, Inc. ("MOI") for cash consideration of $5.5 million , of which $5.0 million was paid as of March 31, 2019 , with the remaining $0.5 million reflected in accrued liabilities. On March 1, 2019, we acquired the outstanding stock of General Photonics Corporation ("GP") for cash consideration of $19.0 million . Of the purchase price, $17.1 million was paid at closing and $1.9 million was placed into escrow for possible working capital adjustments to the purchase price and potential satisfaction of certain post-closing indemnification obligations. Additionally, we can become obligated to pay additional cash consideration of up to $1.0 million if certain revenue targets for the GP historical business are met for the twelve month period following the closing. We currently estimate the fair value of the contingent obligation to be $0.9 million . The purchase price is also subject to adjustment based upon the determination of final working capital as of the closing date compared to a target working capital valued specified in the stock purchase agreement. For the period from the closing of the acquisition through March 31, 2019 , we recognized revenue of $0.7 million and an operating loss of $0.2 million associated with the acquired operations of GP, as a result of $0.2 million in amortization expense for the acquired intangibles. We incurred $0.9 million of costs associated with the acquisition of GP during the three months ended March 31, 2019 , which are included in selling, general and administrative expenses in our consolidated statements of operations. For the three months ended March 31, 2019 , we recognized revenue of $2.7 million and operating income of $0.7 million associated with the acquired operations of MOI. We incurred $0.8 million of costs associated with the acquisition of MOI, previously included in our Annual Report on Form 10-K for the year ended December 31, 2018, as filed with the SEC on March 15, 2019. These acquisitions have been accounted for under the acquisition method of accounting in accordance with ASC 805. Under the acquisition method of accounting, the total estimated purchase consideration is allocated to the acquired tangible and intangible assets and assumed liabilities based on their estimated fair values as of the acquisition date. Any excess of the fair value of the acquisition consideration over the identifiable assets acquired and liabilities assumed is recognized as goodwill. We have completed a preliminary allocation of the purchase consideration with the assistance of a third-party valuation expert. The following allocation of the purchase consideration of each acquisition is subject to revision as additional information becomes known in the future. Preliminary Allocation MOI GP Accounts receivable $ 1,742,693 $ 1,520,950 Inventory 1,435,606 2,698,000 Other current assets 69,951 763,873 Property and equipment 996,460 286,000 Identifiable intangible assets 1,650,000 8,200,000 Goodwill 101,008 10,315,490 Accounts payable and accrued expenses (450,985 ) (3,880,063 ) Total purchase consideration $ 5,544,733 $ 19,904,250 The preliminary identifiable intangible assets and their estimated useful lives were as follows: Estimated Estimated Fair Value Useful Life MOI GP Developed technology 5 - 8 years $ 1,200,000 $ 7,200,000 In process research and development 7 years 200,000 — Trade names and trademarks 3 years 150,000 400,000 Customer base 7 - 15 years 100,000 600,000 $ 1,650,000 $ 8,200,000 Developed technologies acquired primarily consist of MOI's technologies related to fiber optic sensing instruments, modules, and components and GP's technologies relating to the measurement and control of the polarization of light. The developed technologies were valued using the "multi-period excess earnings" method, under the income approach. The multi-period excess earnings method reflects the present value of the projected cash flows that are expected by the developed technologies less charges representing the contribution of other assets to those cash flows. Discount rates of 24.5% and 17% were used to discount the cash flows of MOI and GP, respectively, to present value. In process research and development represents the fair value of incomplete MOI research and development projects that had not reached technological feasibility as of the closing date of the acquisition. In the future, the fair value of each such project at the closing date of the acquisition will be either amortized or impaired depending on whether the project is completed or abandoned. The fair value of in process research and development was determined using the multi-period excess earnings method. A discount rate of 29.5% was used to discount the cash flows to the present value. Customer base represents the fair value of projected cash flows that will be derived from the sale of products to existing customers of MOI and GP as of the respective closing dates of their acquisitions. Customer relationships were valued using the "distributor" method, under the income approach. Under this premise, the margin of a distributor within the industry is deemed to be the margin attributable to customer relationships. This isolates the cash flows attributable to the customer relationships for which a market participant would be willing to pay. Discount rates of 24.5% and 16% were used to discount cash flows of MOI and GP, respectively, to present value. Trade names and trademarks are considered a type of guarantee of a certain level of quality or performance represented by the MOI and GP brands. Trade names and trademarks were valued using the "relief from royalty" method of the income approach. This method is based on the assumption that in lieu of ownership, a market participant would be willing to pay a royalty in order to exploit the related benefits of this asset. Discount rates of 17% and 16% were used to discount the cash flows of MOI and GP, respectively, to the present value. Goodwill represents the excess of consideration transferred over the net of the acquisition date fair values of the assets acquired and the liabilities assumed in connection with the acquisition. Goodwill generated from our business acquisitions was primarily attributable to expected synergies from future growth. Pro forma consolidated results of operations The following unaudited pro forma financial information presents combined results of operations for each of the periods presented as if the acquisitions of MOI and GP had been completed on January 1, 2018. The pro forma information includes adjustments to depreciation expense for property and equipment acquired, to amortize expense for the intangible assets acquired, and to eliminate the acquisition transaction expenses recognized in each period. Transaction-related expenses associated with the acquisition and excluded from the pro forma loss from continuing operations were $0.9 million and $0 for the three months ended March 31, 2019 and 2018 , respectively. The pro forma data are for informational purposes only and are not necessarily indicative of the consolidated results of operations or the combined business had the acquisitions of MOI and GP actually occurred on January 1, 2018, or the results of future operations of the combined business. For instance, planned or expected operational synergies following the acquisition are not reflected in the pro forma information. Consequently, actual results will differ from the unaudited pro forma information presented below. Three Months Ended March 31, 2019 2018 Revenue $ 16,862,410 $ 13,118,836 Income/(loss) from continuing operations $ 2,337,820 $ (343,496 )

Discontinued Operations

Discontinued Operations	3 Months Ended
	Mar. 31, 2019
Discontinued Operations and Disposal Groups [Abstract]
Discontinued Operations	Discontinued Operations On July 31, 2018 , we sold the assets and operations related to our optoelectronic components and subassemblies ("Opto") business, which was part of our Products and Licensing segment, to an unaffiliated third party for an initial purchase price up to $18.5 million , of which $17.5 million was received at closing and has been properly recorded in the financial statements with the remaining purchase price adjustment up to $1.0 million which is contingent upon the attainment of specified revenue targets during the eighteen months following the closing of the sale. The purchase price is subject to adjustment in the future based upon a determination of final working capital, as defined in the asset purchase agreement. The Opto business was a component of the operations of Advanced Photonix, Inc., which we acquired in May 2015, and represented all of our operations in our Camarillo, California and Montreal, Quebec facilities. We have reported the results of operations of the Opto business as discontinued operations in our consolidated interim financial statements. We allocated a portion of the consolidated tax expense to discontinued operations based on the ratio of the discontinued business's loss before allocations. The key components of net income from discontinued operations were as follows: Three Months Ended March 31, 2019 2018 (unaudited) Net revenues $ — $ 3,424,642 Cost of revenues — 2,238,150 Operating expenses — 698,023 Other income — 10,648 Income before income taxes — 499,117 Allocated tax expense — 78,363 Operating income from discontinued operations — 420,754 Net income from discontinued operations $ — $ 420,754 For the three months ended March 31, 2018 , cash flows provided by operating activities for discontinued operations was $ 0.1 million. For the three months ended March 31, 2018 cash flows used in investing activities for discontinued operations was $0.1 million.

Goodwill

Goodwill	3 Months Ended
	Mar. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	Goodwill The changes in the carrying value of goodwill during the three months ended March 31, 2019 were as follows: Balance as of December 31, 2018 $ 101,008 Goodwill resulting from business combination - GP 10,315,490 Goodwill resulting from business combination - MOI (1) (71,249 ) Balance as of March 31, 2019 $ 10,345,249 (1) This is a measurement period adjustment.

Inventory

Inventory	3 Months Ended
	Mar. 31, 2019
Inventory Disclosure [Abstract]
Inventory	Inventory Inventory consists of finished goods, work-in-process and raw materials valued at the lower of cost (determined on the first-in, first-out basis) or market. We write down inventory for estimated obsolescence or unmarketable inventory in an amount equal to the difference between the cost of the inventory and the estimated market value based upon assumptions about future demand and market conditions. Components of inventory were as follows: March 31, December 31, (unaudited) Finished goods $ 2,057,274 $ 1,339,832 Work-in-process 1,733,065 643,420 Raw materials 6,205,715 4,890,490 Total inventory $ 9,996,054 $ 6,873,742

Accrued Liabilities

Accrued Liabilities	3 Months Ended
	Mar. 31, 2019
Payables and Accruals [Abstract]
Accrued Liabilities	Accrued Liabilities Accrued liabilities at March 31, 2019 and December 31, 2018 consisted of the following: March 31, 2019 December 31, 2018 (unaudited) Accrued compensation $ 4,864,146 $ 4,467,587 Income tax payable 296,134 236,636 Accrued professional fees 107,000 198,062 Deferred Rent — 146,542 Current operating lease liability 1,374,060 — Current finance lease liability 45,982 — Royalties 84,535 302,428 Accrued interest 1,615 — Accrued liabilities - other 1,282,770 404,752 Liability to related party — 298,468 Working capital payable 542,983 542,983 Total accrued liabilities $ 8,599,225 $ 6,597,458

Debt

Debt	3 Months Ended
	Mar. 31, 2019
Debt Disclosure [Abstract]
Debt	Debt Silicon Valley Bank Facility We currently have a Loan and Security Agreement with SVB (the "Credit Facility") under which, as amended, we have a term loan with an original borrowing amount of $6.0 million (the “Original Term Loan”). The Original Term Loan is repayable in 48 monthly installments of $125,000 , plus accrued interest payable monthly in arrears, and matured in May 2019. The Original Term Loan carries a floating annual interest rate equal to SVB’s prime rate then in effect plus 2% . We may prepay amounts due under the Original Term Loan at any time, subject to an early termination fee of up to 2% of the amount of prepayment. In September 2015, we entered into the Waiver and Seventh Loan Modification Agreement, which provided an additional $1.0 million of available financing for purchases of equipment through December 31, 2015, which we fully borrowed in December 2015 (the "Second Term Loan" and, together with the Original Term Loan, the "Term Loans"). The Second Term Loan also bears interest at a floating prime rate plus 2% and is to be repaid in 35 monthly installments of $27,778 plus accrued interest. The Credit Facility requires us to maintain a minimum cash balance of $4.0 million and to maintain at each month end a ratio of cash plus 60% of accounts receivable greater than or equal to 1.5 times the outstanding principal of the Term Loans. The Credit Facility also requires us to observe a number of additional operational covenants, including protection and registration of intellectual property rights, and certain customary negative covenants. As of March 31, 2019 , we were in compliance with all covenants under the Credit Facility. Amounts due under the Credit Facility are secured by substantially all of our assets, including intellectual property, personal property and bank accounts. In addition, the Credit Facility contains customary events of default, including nonpayment of principal, interest or other amounts, violation of covenants, material adverse change, an event of default under any subordinated debt documents, incorrectness of representations and warranties in any material respect, bankruptcy, judgments in excess of a threshold amount, and violations of other agreements in excess of a threshold amount. If any event of default occurs SVB may declare due immediately all borrowings under the Credit Facility and foreclose on the collateral. Furthermore, an event of default under the Credit Facility would result in an increase in the interest rate on any amounts outstanding. As of March 31, 2019 , there were no events of default on the Credit Facility. The aggregate balance under the Term Loans at March 31, 2019 and December 31, 2018 , was $0.3 million and $0.6 million , respectively. The remaining Term Loan, with a balance of $ 0.3 million an d $0.6 million as of March 31, 2019 and December 31, 2018 , respectively, matured on May 1, 2019 and was paid in full. The effective rate of our Term Loan at March 31, 2019 was 7.5% . The following table presents a summary of debt outstanding as of March 31, 2019 and December 31, 2018 : March 31, 2019 December 31, 2018 (unaudited) Silicon Valley Bank Term Loan $ 250,000 $ 625,000 Less: unamortized debt issuance costs 2,274 5,685 Less: current portion 247,726 619,315 Total long-term debt $ — $ —

Leases

Leases	3 Months Ended
	Mar. 31, 2019
Leases [Abstract]
Leases	Leases The Company has operating leases for our facilities, which have remaining terms ranging from 1 to 5 years. Most of our leases do not have an option to extend the lease period beyond the stated term unless the new term is agreed by both parties. They also do not have an early termination clause included. Our operating lease agreements do not contain any material restrictive covenants. Some of our operating lease agreements contain variable payment provisions that provide for rental increases based on consumer price indices. The change in rent expense resulting from changes in these indices are included within variable rent. The Company also has finance leases for equipment which have remaining terms ranging from 1 to 4 years. These lease agreements are for general office equipment with a 5 -year useful life. These lease agreements do not have an option to extend the lease beyond the stated terms nor do they have an early termination clause. These lease agreements do not have any variable payment provisions included. As of March 31, 2019 , the Company's lease components included in the consolidated balance sheet were as follows: Lease component Classification March 31, 2019 Assets ROU assets - operating lease Other assets $ 3,142,208 ROU assets - finance lease Other assets 27,738 Total ROU assets $ 3,169,946 Liabilities Current operating lease liability Accrued liabilities $ 1,374,060 Current finance lease liability Accrued liabilities 45,982 Long-term operating lease liability Other liabilities 2,914,504 Long-term finance lease liability Other liabilities 56,375 Total lease liabilities $ 4,390,921 Rent expense is recognized on a straight-line basis over the life of the lease. Rent expense consists of the following: Three months ended March 31, 2019 Operating lease costs $ 403,899 Variable rent costs (36,161 ) Total rent expense $ 367,738 Future minimum lease payments under non-cancellable leases were as follows: March 31, 2019 2019 - remaining 9 months $ 1,218,577 2020 1,467,701 2021 640,800 2022 544,704 2023 544,704 2024 and beyond 544,704 Total future minimum lease payments $ 4,961,190 Less: Interest 672,626 Total operating lease liabilities $ 4,288,564 Current operating lease liability $ 1,374,060 Long-term operating lease liability 2,914,504 Total operating lease liabilities $ 4,288,564 Other information related to leases is as follows: Three months ended March 31, 2019 Finance lease cost: Amortization of right-of-use assets $ 12,808 Interest on lease liabilities 2,176 Total finance lease cost $ 14,984 Other information: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 403,899 Finance cash flows from finance leases $ 6,763 Right-of-use assets obtained in exchange for new operating lease liabilities — Right-of-use assets obtained in exchange for new finance lease liabilities $ 14,541 Weighted-average remaining lease term - operating leases 4.0 Weighted-average remaining lease term - finance leases 2.7 Weighted-average discount rate - operating leases 7 % Weighted-average discount rate - finance leases 7 %
Leases	Leases The Company has operating leases for our facilities, which have remaining terms ranging from 1 to 5 years. Most of our leases do not have an option to extend the lease period beyond the stated term unless the new term is agreed by both parties. They also do not have an early termination clause included. Our operating lease agreements do not contain any material restrictive covenants. Some of our operating lease agreements contain variable payment provisions that provide for rental increases based on consumer price indices. The change in rent expense resulting from changes in these indices are included within variable rent. The Company also has finance leases for equipment which have remaining terms ranging from 1 to 4 years. These lease agreements are for general office equipment with a 5 -year useful life. These lease agreements do not have an option to extend the lease beyond the stated terms nor do they have an early termination clause. These lease agreements do not have any variable payment provisions included. As of March 31, 2019 , the Company's lease components included in the consolidated balance sheet were as follows: Lease component Classification March 31, 2019 Assets ROU assets - operating lease Other assets $ 3,142,208 ROU assets - finance lease Other assets 27,738 Total ROU assets $ 3,169,946 Liabilities Current operating lease liability Accrued liabilities $ 1,374,060 Current finance lease liability Accrued liabilities 45,982 Long-term operating lease liability Other liabilities 2,914,504 Long-term finance lease liability Other liabilities 56,375 Total lease liabilities $ 4,390,921 Rent expense is recognized on a straight-line basis over the life of the lease. Rent expense consists of the following: Three months ended March 31, 2019 Operating lease costs $ 403,899 Variable rent costs (36,161 ) Total rent expense $ 367,738 Future minimum lease payments under non-cancellable leases were as follows: March 31, 2019 2019 - remaining 9 months $ 1,218,577 2020 1,467,701 2021 640,800 2022 544,704 2023 544,704 2024 and beyond 544,704 Total future minimum lease payments $ 4,961,190 Less: Interest 672,626 Total operating lease liabilities $ 4,288,564 Current operating lease liability $ 1,374,060 Long-term operating lease liability 2,914,504 Total operating lease liabilities $ 4,288,564 Other information related to leases is as follows: Three months ended March 31, 2019 Finance lease cost: Amortization of right-of-use assets $ 12,808 Interest on lease liabilities 2,176 Total finance lease cost $ 14,984 Other information: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 403,899 Finance cash flows from finance leases $ 6,763 Right-of-use assets obtained in exchange for new operating lease liabilities — Right-of-use assets obtained in exchange for new finance lease liabilities $ 14,541 Weighted-average remaining lease term - operating leases 4.0 Weighted-average remaining lease term - finance leases 2.7 Weighted-average discount rate - operating leases 7 % Weighted-average discount rate - finance leases 7 %

Capital Stock and Share-Based C

Capital Stock and Share-Based Compensation	3 Months Ended
	Mar. 31, 2019
Equity [Abstract]
Capital Stock and Share-Based Compensation	Capital Stock and Share-Based Compensation We recognize share-based compensation expense based upon the fair value of the underlying equity award on the date of the grant. For restricted stock awards and restricted stock units, we recognize expense based upon the price of our underlying stock at the date of the grant. We have elected to use the Black-Scholes-Merton option pricing model to value any option or warrant awards granted. We recognize share-based compensation for such awards on a straight-line basis over the requisite service period of the awards. The risk-free interest rate is based on U.S. Treasury interest rates, the terms of which are consistent with the expected life of the stock options. The expected life is based upon historical experience of homogeneous groups within our company. We also assume an expected dividend yield of zero for all periods, as we have never paid a dividend on our common stock and do not have any plans to do so in the future. Stock Options A summary of the stock option activity for the three months ended March 31, 2019 is presented below: Options Outstanding Options Exercisable Number of Shares Price per Share Weighted Average Exercise Price Aggregate Intrinsic Value (1) Number of Shares Weighted Average Exercise Price Aggregate Intrinsic Value (1) Balance, January 1, 2018 3,108,868 $0.61 - $6.55 $ 2.26 $ 3,669,794 1,986,740 $ 1.81 $ 3,314,494 Granted 565,070 $3.21 - $3.37 Exercised (260,344 ) $1.18 - $1.80 Canceled (1,469 ) 1.47 Balance, March 31, 2019 3,412,125 $0.61 - $6.23 $ 2.48 $ 5,844,998 1,810,984 $ 1.91 $ 4,170,283 (1) The intrinsic value of an option represents the amount by which the market value of the stock exceeds the exercise price of the option of in-the-money options only. The aggregate intrinsic value is based on the closing price of our common stock on the Nasdaq Capital Market, as applicable, on the respective dates. At March 31, 2019 , the outstanding stock options to purchase an aggregate of 3.4 million shares had a weighted-average remaining contractual term of 6.4 years, and the exercisable stock options to purchase an aggregate of 1.8 million shares had a weighted-average remaining contractual term of 3.6 years. The fair value of shares underlying vested options was $7.6 million at March 31, 2019 . The fair value of shares underlying options exercised during the three months ended March 31, 2019 was $400,470 . For the three months ended March 31, 2019 and 2018 we recognized $0.3 million and $0.1 million in share-based compensation expense, respectively, which is included in our selling, general and administrative expense in the accompanying consolidated interim financial statements. We expect to recognize $3.3 million in share-based compensation expense over the weighted-average remaining service period of 3.2 years for stock options outstanding as of March 31, 2019 . Restricted Stock and Stock Units Historically, we have granted shares of restricted stock to certain employees that have vested in three equal annual installments on the anniversary dates of their grant. However, beginning in 2019, we altered our approach for these grants to replace the grant of restricted stock subject to time-based vesting with the grant of a combination of restricted stock units ("RSUs") subject to time-based vesting and performance-based vesting. Each RSU represents the contingent right to receive a single share of our common stock upon the vesting of the award. For the three months ended March 31, 2019 , we issued an aggregate of 230,000 RSUs to certain employees. Of the RSUs issued during the three months ended March 31, 2019 , 167,000 of such RSUs are subject to time-based vesting and are scheduled to vest in three equal annual installments on the anniversary dates of the grant. The remaining 63,000 RSUs are performance-based awards that will vest based on our achievement of long-term performance goals, in particular, based on our levels of 2021 revenue and operating income. The 63,000 shares issuable upon vesting of the performance-based RSUs represent the maximum payout under our performance-based awards, based upon 150% of our target performance for 2021 revenue and operating income (the payout of such awards based on target performance for 2021 revenue and operating income would be 42,000 shares). In the case of the time-based and performance-based RSUs, vesting is also subject to the employee's continuous service with us through vesting. In addition, in conjunction with our 2018 Annual Meeting of Stockholders, we issued RSUs to certain members of our Board of Directors in respect of the annual equity compensation under our non-employee director compensation policy (other members of our Board of Directors elected to receive their annual equity compensation for Board service in the form of stock units under our Deferred Compensation Plan as described below). RSUs issued to our Board of Directors vest at the earlier of the one -year anniversary of their grant or the next annual stockholders' meeting. During the three months ended March 31, 2019 , no shares of restricted stock or RSUs vested. The following table summarizes the value of our unvested restricted stock awards and restricted stock units: Number of Unvested Shares Weighted Average Grant Date Fair Value Aggregate Grant Date Fair Value of Unvested Shares Balance, January 1, 2019 458,620 $ 2.56 $ 1,172,456 Granted 230,000 $ 2.97 683,430 Vested — — — Forfeitures — — — Balance, March 31, 2019 688,620 $ 2.70 $ 1,855,886 Non-employee Director Deferred Compensation Plan We maintain a non-employee director deferred compensation plan (the “Deferred Compensation Plan”) that permits our non-employee directors to defer receipt of certain of the compensation that they receive for serving on our board and board committees. The Deferred Compensation Plan has historically permitted the participants to elect to defer cash fees to which they were entitled for board and committee service. For participating directors, in lieu of payment of cash fees, we credit their accounts under the Deferred Compensation Plan with a number of stock units based on the trading price of our common stock as of the date of the deferral. These stock units vest immediately, although the participating directors do not receive the shares represented by such units until a future qualifying event. In December 2017, we amended and restated our Deferred Compensation Plan to also permit participating non-employee directors to elect, beginning in 2018, to defer the receipt of some or all of the equity compensation that they receive for board and committee service. Stock units representing this equity compensation vest at the earlier of the one year anniversary of their grant or the next annual stockholders' meeting. The following is a summary of our stock unit activity under the Deferred Compensation Plan for the three months ended March 31, 2019 : Number of Stock Units Weighted Average Grant Date Fair Value per Share Intrinsic Value Outstanding Balance, January 1, 2019 507,290 $1.53 $ 1,699,422 Granted 9,104 3.35 Forfeitures — — Converted — — Balance, March 31, 2019 516,394 $1.56 $ 2,153,363 As of March 31, 2019 , 48,859 of the outstanding stock units had not yet vested. The following table details our equity transactions during the three months ended March 31, 2019 : Preferred Stock Common Stock Treasury Stock Additional Paid-in Capital Accumulated Deficit Total Shares $ Shares $ Shares $ $ Balance at January 1, 2019, as previously reported 1,321,514 1,322 27,956,401 30,120 1,253,105 (2,116,640 ) 85,744,750 (21,305,222 ) 62,354,330 Exercise of stock options — — 189,312 189 — — 184,769 — 184,958 Share-based compensation — — — — — — 342,765 — 342,765 Non-cash compensation — — — — — — — — — Stock dividends to Carilion Clinic (1) — — — 20 — — 83,038 (83,058 ) — Net Income — — — — — — — 1,125,879 1,125,879 Purchase of treasury stock — — — — — — — — — Balance, March 31, 2019 1,321,514 1,322 28,145,713 30,329 1,253,105 (2,116,640 ) 86,355,322 (20,262,401 ) 64,007,932 (1) The stock dividends payable in connection with Carilion Clinic’s Series A Preferred Stock will be issued subsequent to March 31, 2019 . For the period from January 12, 2010, the original issue date of the Series A Preferred Stock, through March 31, 2019 , the Series A Preferred Stock issued to Carilion has accrued $1,500,692 in dividends. The accrued and unpaid dividends as of March 31, 2019 will be paid by the issuance of 730,808 shares of our common stock upon Carilion’s written request. Stock Repurchase Program In May 2016, our board of directors authorized us to repurchase up to $2.0 million of our common stock through May 31, 2017. As of May 31, 2017, we had repurchased a total of 205,500 shares for an aggregate purchase price of $0.2 million under this stock repurchase program, after which this stock repurchase program expired. In September 2017, our board of directors re-instituted the stock repurchase program and authorized us to repurchase up to $2.0 million of our common stock through September 19, 2018. Our stock repurchase program did not obligate us to acquire any specific number of shares. Under the program, shares could be repurchased in privately negotiated or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. As of September 19, 2018, we had repurchased a total of 565,629 shares for an aggregate purchase price of $1.1 million under this stock repurchase program, after which this stock repurchase program expired. We currently maintain all repurchased shares under these stock repurchase programs as treasury stock.

Revenue Recognition

Revenue Recognition	3 Months Ended
	Mar. 31, 2019
Revenue from Contract with Customer [Abstract]
Revenue Recognition	Revenue Recognition Disaggregation of Revenue Our operations are divided into two operating segments—“Technology Development” and “Products and Licensing”. The Technology Development segment provides applied research to customers in our areas of focus. Our engineers and scientists collaborate with our network of government, academic and industry experts to identify technologies and ideas with promising market potential. We then compete to win fee-for-service contracts from government agencies and industrial customers who seek innovative solutions to practical problems that require new technology. The Technology Development segment derives its revenues primarily from services. The Products and Licensing segment derives its revenues from product sales, funded product development and technology licenses. We disaggregate our revenue from contracts with customers by geographic locations, customer-type, contract type, timing of recognition, and major categories for each of our segments, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. The details are listed in the table below for the periods ending March 31, 2019 and 2018 : Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 (unaudited) (unaudited) Technology Development Products and Licensing Total Technology Development Products and Licensing Total Total Revenue by Geographic Location United States $ 6,640,743 $ 3,919,943 $ 10,560,686 $ 4,636,776 $ 2,441,496 $ 7,078,272 Asia — 2,406,002 2,406,002 — 1,003,133 1,003,133 Europe — 1,655,307 1,655,307 — 587,406 587,406 Canada, Central and South America — 181,185 181,185 — 97,719 97,719 All Others — 29,938 29,938 — 2,000 2,000 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530 Total Revenue by Major Customer Type Sales to the U.S. government $ 6,475,448 $ 785,223 $ 7,260,671 $ 4,605,154 $ 10,357 $ 4,615,511 U.S. direct commercial sales and other 165,295 3,134,720 3,300,015 31,622 2,441,721 2,473,343 Foreign commercial sales & other — 4,272,432 4,272,432 — 1,679,676 1,679,676 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530 Total Revenue by Contract Type Fixed-price contracts $ 3,662,434 $ 8,192,375 $ 11,854,809 $ 2,231,654 $ 4,131,754 $ 6,363,408 Cost-type contracts 2,978,309 — 2,978,309 2,405,122 — 2,405,122 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530 Total Revenue by Timing of Recognition Goods transferred at a point in time $ — $ 7,595,593 $ 7,595,593 $ — $ 3,964,349 $ 3,964,349 Goods/services transferred over time 6,640,743 596,782 7,237,525 4,636,776 167,405 4,804,181 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530 Total Revenue by Major Products/Services Technology development $ 6,640,743 $ — $ 6,640,743 $ 4,636,776 $ — $ 4,636,776 Optical test and measurement systems — 7,343,193 7,343,193 — 3,688,009 3,688,009 Other — 849,182 849,182 — 443,745 443,745 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530 Contract Balances Our contract assets consist of unbilled amounts for technology development contracts as well as custom product contracts. Also included in contract assets are royalty revenue and carrying amounts of right of returned inventory. Long-term contract assets include the fee withholding on cost reimbursable contracts that will not be billed within a year. Contract liabilities include excess billings, subcontractor accruals, warranty expense, extended warranty revenue, right of return refund, and customer deposits. The following table shows the components of our contract balances as of March 31, 2019 and December 31, 2018 : March 31, 2019 December 31, 2018 Contract assets $ 3,188,352 $ 2,759,315 Contract liabilities (2,792,119 ) (2,486,111 ) Net contract assets (liabilities) $ 396,233 $ 273,204 Performance Obligations Unfulfilled performance obligations represent amounts expected to be earned on executed contracts. Indefinite delivery and quantity contracts and unexercised options are not reported in total unfulfilled performance obligations. Unfulfilled performance obligations include funded obligations, which is the amount for which money has been directly authorized by the U.S. government and for which a purchase order has been received by a commercial customer, and unfunded obligations represent firm orders for which funding has not yet been appropriated. The approximate value of our Technology Development segment unfulfilled performance obligations was $25.9 million at March 31, 2019 . We expect to satisfy 61% of the performance obligations in 2019, 32% in 2020 and the remainder by 2022. The approximate value of our Products and Licensing segment unfulfilled performance obligations was $15.0 million at March 31, 2019 . We expect to satisfy 49% of the performance obligations in 2019, 21% in 2020 and the remainder by 2023.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2019
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes We and our subsidiaries file U.S. Federal income tax returns and income tax returns in various state, local and foreign jurisdictions. Our quarterly tax provision, and our quarterly estimate of our annual effective tax rate, is subject to significant variation due to several factors, including the variability in accurately predicting our pre-tax and taxable income and the mix of jurisdictions to which they relate, changes in how we do business, changes in our stock price, tax law developments (including changes in statues, regulations, case law, and administrative practices), and relative changes of expenses or losses for which tax benefits are not recognized. Additionally, our effective tax rate can be more or less volatile based on the amount if pre-tax income or loss. For example, the impact of discrete items and non-deductible expenses on our effective tax rate is greater when our pre-tax income is lower. For 2019, the anticipated effective income tax rate is expected to continue to differ from the Federal statutory rate of 21% primarily because of the partial release of the valuation allowance related to net operating loss carryforwards expected to be used to offset taxable income in the period and certain discrete items. We consider both positive and negative evidence when evaluating the recoverability of our deferred tax assets ("DTAs"). The assessment is required to determine whether based on all available evidence, it is more likely than not (i.e. greater than a 50% probability) that all or some portion of the DTAs will be realized in the future. As of March 31, 2019 , management has concluded a partial valuation allowance of the DTAs is necessary because of sufficient uncertainty in our ability to realize the benefit associated with such DTAs in the future.

Operating Segments

Operating Segments	3 Months Ended
	Mar. 31, 2019
Segment Reporting [Abstract]
Operating Segments	Operating Segments Our operations are divided into two operating segments—“Technology Development” and “Products and Licensing”. The Technology Development segment provides applied research to customers in our areas of focus. Our engineers and scientists collaborate with our network of government, academic and industry experts to identify technologies and ideas with promising market potential. We then compete to win fee-for-service contracts from government agencies and industrial customers who seek innovative solutions to practical problems that require new technology. The Technology Development segment derives its revenues primarily from services. The Products and Licensing segment derives its revenues from product sales, funded product development and technology licenses. Through March 31, 2019 , our Chief Executive Officer and his direct reports collectively represented our chief operating decision makers, and they evaluated segment performance based primarily on revenues and operating income or loss. The accounting policies of our segments are the same as those described in the summary of significant accounting policies (see Note 1 to our Financial Statements, “Organization and Summary of Significant Accounting Policies,” presented in our Annual Report on Form 10-K as filed with the SEC on March 15, 2019). The table below presents revenues and operating income/(loss) for reportable segments: Three Months Ended March 31, 2019 2018 (unaudited) Revenues: Technology development $ 6,640,743 $ 4,636,776 Products and licensing 8,192,375 4,131,754 Total revenues $ 14,833,118 $ 8,768,530 Technology development operating income/(loss) $ 64,237 $ 99,234 Products and licensing operating income/(loss) (961,815 ) (14,983 ) Total operating income/(loss) $ (897,578 ) $ 84,251 Depreciation, technology development $ 98,395 $ 93,600 Depreciation, products and licensing $ 158,990 $ 64,317 Amortization, technology development $ 27,932 $ 37,206 Amortization, products and licensing $ 331,992 $ 112,729 The table below presents assets for reportable segments: March 31, December 31, (unaudited) Total segment assets: Technology development $ 32,331,533 $ 34,823,525 Products and licensing 51,232,275 40,775,211 Total assets $ 83,563,808 $ 75,598,736 Property plant and equipment, and intangible assets, technology development $ 2,162,062 $ 2,103,711 Property plant and equipment, and intangible assets, products and licensing $ 23,338,116 $ 4,927,453 The U.S. government accounted for 49% and 41% of total consolidated revenues for the three months ended March 31, 2019 and 2018 , respectively. International revenues (customers outside the United States) accounted for 29% and 22% of total consolidated revenues for the three months ended March 31, 2019 and 2018 , respectively. No single country, outside of the United States, represented more than 10% of total revenues in the three months ended March 31, 2019 and 2018 .

Contingencies and Guarantees

Contingencies and Guarantees	3 Months Ended
	Mar. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
Contingencies and Guarantees	Contingencies and Guarantees We are from time to time involved in certain legal proceedings in the ordinary course of conducting our business. While the ultimate liability pursuant to these actions cannot currently be determined, we believe it is not reasonably possible that these legal proceedings will have a material adverse effect on our financial position or results of operations. In March 2018, we received a notice of claim (the "Claim") from Macom Technology Solutions, Inc. ("Macom"), who acquired our HSOR business in August 2017 pursuant to an asset purchase agreement. Under the asset purchase agreement, we agreed to indemnify Macom for certain matters, including, among other things, the collection of accounts receivable from certain major customers, and placed $4.0 million of the purchase price into an escrow account for the potential settlement of any valid indemnity claims. The notice of claim received from Macom totaled $2.0 million under various indemnity provisions. We have disputed Macom's assertion of right to payment for the matters described in the Claim. It is uncertain what amount, if any, will be owed in settlement of the Claim. As of March 31, 2019 , $1.5 million of the escrow balance had been received with the remaining $2.5 million in the escrow account pending resolution of the dispute. On July 31, 2018, we sold the assets associated with our Opto components business to an unaffiliated third party. The asset purchase agreement provides for additional consideration of up to $1.0 million contingent upon the achievement of a specified revenue level by the sold business during the 18 months following the sale. In addition, the asset purchase agreement provides for a potential adjustment to the consideration paid, either positive or negative, to the extent that working capital transferred to the buyer is greater or less than a specified target amount. There have been no amounts recorded in reference to the above matter in the financial statements as of March 31, 2019 . It is uncertain what amount, if any, will be received or paid with respect to each of these potential adjustments. We executed a non-cancelable purchase order totaling $0.5 million in the fourth quarter of 2017 and a non-cancelable purchase order totaling $1.1 million in the first quarter of 2018 for multiple shipments of tunable lasers to be delivered over an 18 -month period. At March 31, 2019 , approximately $0.3 million of these commitments remained and is expected to be delivered by July 30, 2019 . We have entered into indemnification agreements with our officers and directors, to the extent permitted by law, pursuant to which we have agreed to reimburse the officers and directors for legal expenses in the event of litigation and regulatory matters. The terms of these indemnification agreements provide for no limitation to the maximum potential future payments. We have a directors and officers insurance policy that may, in certain instances, mitigate the potential liability and payments.

Basis of Presentation and Sig_2

Basis of Presentation and Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2019
Accounting Policies [Abstract]
Nature of Operations	Nature of Operations Luna Innovations Incorporated (“we,” “Luna Innovations” or the “Company”), headquartered in Roanoke, Virginia, was incorporated in the Commonwealth of Virginia in 1990 and reincorporated in the State of Delaware in April 2003. We are a leader in advanced optical technology, providing high performance fiber optic test products for the telecommunications industry and distributed fiber optic sensing products for industries utilizing composite and other advanced materials, such as the automotive, aerospace, energy and infrastructure industries. Our distributed fiber optic sensing products help designers and manufacturers more efficiently develop new and innovative products by providing valuable information such as highly detailed stress, strain, and temperature measurements of a new design or manufacturing process. In addition, our distributed fiber optic sensing products are used to monitor the structural integrity or operational health of critical assets, including large civil structures such as bridges. Our communications test products accelerate the development of advanced fiber optic components and networks by providing fast and highly accurate characterization of components and networks. We also provide applied research services, typically under research programs funded by the U.S. government, in areas of advanced materials, sensing, and healthcare applications. Our business model is designed to accelerate the process of bringing new and innovative products to market. We use our in-house technical expertise across a range of technologies to perform applied research services for companies and for government funded projects. We continue to invest in product development and commercialization, which we anticipate will lead to increased product sales growth.
Unaudited Interim Financial Information	Unaudited Interim Financial Information The accompanying unaudited consolidated interim financial statements have been prepared in accordance with accounting principles generally accepted in the United Stated of America (“U.S. GAAP”) for interim financial statements and Article 10 of Regulation S-X of the Securities Exchange Act of 1934, as amended. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. The unaudited consolidated interim financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management reflect all adjustments, consisting of only normal recurring accruals considered necessary to present fairly our financial position at March 31, 2019 , results of operations for the three months ended March 31, 2019 and 2018 , and cash flows for the three months ended March 31, 2019 and 2018 . The results of operations for the three months ended March 31, 2019 , are not necessarily indicative of the results that may be expected for the year ending December 31, 2019 . The consolidated balance sheet as of December 31, 2018 was derived from our audited consolidated financial statements. The consolidated interim financial statements, including our significant accounting policies, should be read in conjunction with the audited Consolidated Financial Statements and the notes thereto for the year ended December 31, 2018 , included in our Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on March 15, 2019 .
Business Combinations	Business Combinations We apply the provisions of Accounting Standards Codification ("ASC") 805, Business Combinations , in the accounting for acquisitions. ASC 805 requires us to recognize separately from goodwill the assets acquired and the liabilities assumed at their acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net of the acquisition date fair values of the assets acquired and the liabilities assumed. While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date as well as contingent consideration, where applicable, these estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of the assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in our consolidated statements of operations. Accounting for business combinations requires management to make significant estimates and assumptions, especially at the acquisition date, including estimates for intangible assets, contractual obligations assumed, restructuring liabilities, pre-acquisition contingencies and contingent consideration, where applicable. Although we believe the assumptions and estimates we have made have been reasonable and appropriate, they are based in part on historical experience and information obtained from management of the acquired companies and are inherently uncertain. Critical estimates in valuing certain of the intangible assets we have acquired include: future expected cash flows from product sales; customer contracts and acquired technologies; expected costs to develop in-process research and development into commercially viable products and estimated cash flows from the projects when completed; and discount rates. Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates, or actual results.
Goodwill and Intangible Assets	Goodwill and Intangible Assets Goodwill and intangible assets with indefinite lives are not amortized but are tested for impairment on an annual basis, as of October 1 of each year, or whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. Purchased intangible assets with finite useful lives are amortized using the straight-line method over their estimated useful lives and reviewed for impairment as described above.
Fair Value Measurements	Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between marketplace participants. Various valuation approaches can be used to determine fair value, each requiring different valuation inputs. The following hierarchy classifies the inputs used to determine fair value into three levels: • Level 1—Quoted prices for identical instruments in active markets • Level 2—Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets • Level 3—Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short-term nature of these instruments. The carrying value of our debt approximates fair value, as we consider the floating interest rate on our credit facilities with Silicon Valley Bank ("SVB") to be at market for similar instruments. Certain non-financial assets and liabilities are measured at fair value on a nonrecurring basis in accordance with U.S. GAAP. This includes items such as non-financial assets and liabilities initially measured at fair value in a business combination and non-financial long-lived asset groups measured at fair value for an impairment assessment. In general, non-financial assets including intangible assets and property and equipment are measured at fair value when there is an indication of impairment and are recorded at fair value only when any impairment is recognized.
Net Income/(Loss) Per Share	Net Income/(Loss) Per Share Basic per share data is computed by dividing our net income/(loss) by the weighted average number of shares outstanding during the period. Diluted per share data is computed by dividing net income/(loss), if applicable, by the weighted average shares outstanding during the period increased to include, if dilutive, the number of additional common share equivalents that would have been outstanding if potential shares of common stock had been issued using the treasury stock method. Diluted per share data would also include the potential common share equivalents relating to convertible securities by application of the if-converted method.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued a new standard related to Leases, Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842) and subsequent amendments, which replaced existing GAAP and requires lessees to recognize right-of-use ("ROU") assets and lease liabilities on the balance sheet for those leases classified as operating leases for greater transparency. The Company, using a modified retrospective adoption approach, is required to recognize and measure leases existing at the beginning of the adoption period, with certain practical expedients available. The Company adopted the standard effective January 1, 2019. The standard allows a number of optional practical expedients to use for transition. The Company choose the certain practical expedients allowed under the transition guidance which permitted us to not to reassess any existing or expired contracts to determine if they contain embedded leases, to not to reassess our lease classification on existing leases, to account for lease and non-lease components as a single lease component for equipment leases, and whether initial direct costs previously capitalized would qualify for capitalization under FASB ASC 842. The new standard also provides practical expedients and recognition exemptions for an entity's ongoing accounting policy elections. The Company has elected the short-term lease recognition for all leases that qualify, which means that we do not recognize a ROU asset and lease liability for any lease with a term of twelve months or less. The most significant impact of adopting the standard was the recognition of ROU assets and lease liabilities for operating leases on the Company's consolidated balance sheet but it did not have an impact on the Company's consolidated statements of operations or consolidated statements of cash flows. The cumulative effect of the changes made to our January 1, 2019 unaudited consolidated balance sheet as a result of the adoption of ASC 842 are as follows: Balance at Adjustment for Adjusted balance at December 31, 2018 ASC 842 January 1, 2019 Assets: Property and equipment, net 3,627,886 (26,004 ) 3,601,882 Other assets, net 1,995 3,471,643 3,473,638 Liabilities: Accrued liabilities 6,597,458 1,242,669 7,840,127 Current portion of capital lease obligations 40,586 (40,586 ) — Long-term deferred rent 1,035,974 (1,035,974 ) — Long-term operating lease liability — 3,271,705 3,271,705 Long-term capital lease obligations 68,978 (68,978 ) — Long-term finance lease liability — 76,803 76,803 Effective January 1, 2018, we adopted ASU No. 2016-15, Statement of Cash Flows (Topic 230) , which addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice in how cash receipts and cash payments are presented in the statement of cash flows. The adoption of ASU No. 2016-15 did not have a significant impact on our consolidated financial statements. In February 2018, the FASB issued ASU 2018-02: Income Statement – Reporting Comprehensive Income (Topic 220) . Under current accounting guidance, the income tax effects for changes in income tax rates and certain other transactions are recognized in income from continuing operations resulting in income tax effects recognized in accumulated other comprehensive income that do not reflect the current tax rate of the entity (“stranded tax effects”). The new guidance allows us the option to reclassify these stranded tax effects to accumulated deficit that relate to the change in the federal tax rate resulting from the passage of the Tax Cuts and Jobs Act. This update is effective for fiscal years beginning after December 15, 2018, including interim periods therein, and early adoption is permitted. We do not expect the adoption of this standard will have a significant impact on our consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Changes to the Disclosure Requirements for Fair Value Measurement. which amends the disclosure requirements in ASC 820 by adding, changing, or removing certain disclosures. The ASU applies to all entities that are required under this guidance to provide disclosures about recurring or nonrecurring fair value measurements. These amendments are effective for all entities for fiscal years beginning after December 15, 2019 including interim periods within those fiscal years. We do not expect ASU 2018-13 will have a material impact on our consolidated financial statements.

Basis of Presentation and Sig_3

Basis of Presentation and Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2019
Accounting Policies [Abstract]
Schedule of the Cumulative Effect of Adoption of Topic 842	The cumulative effect of the changes made to our January 1, 2019 unaudited consolidated balance sheet as a result of the adoption of ASC 842 are as follows: Balance at Adjustment for Adjusted balance at December 31, 2018 ASC 842 January 1, 2019 Assets: Property and equipment, net 3,627,886 (26,004 ) 3,601,882 Other assets, net 1,995 3,471,643 3,473,638 Liabilities: Accrued liabilities 6,597,458 1,242,669 7,840,127 Current portion of capital lease obligations 40,586 (40,586 ) — Long-term deferred rent 1,035,974 (1,035,974 ) — Long-term operating lease liability — 3,271,705 3,271,705 Long-term capital lease obligations 68,978 (68,978 ) — Long-term finance lease liability — 76,803 76,803

Business Combinations (Tables)

Business Combinations (Tables)	3 Months Ended
	Mar. 31, 2019
Business Combinations [Abstract]
Allocation of Purchase Consideration	The following allocation of the purchase consideration of each acquisition is subject to revision as additional information becomes known in the future. Preliminary Allocation MOI GP Accounts receivable $ 1,742,693 $ 1,520,950 Inventory 1,435,606 2,698,000 Other current assets 69,951 763,873 Property and equipment 996,460 286,000 Identifiable intangible assets 1,650,000 8,200,000 Goodwill 101,008 10,315,490 Accounts payable and accrued expenses (450,985 ) (3,880,063 ) Total purchase consideration $ 5,544,733 $ 19,904,250
Schedule of Preliminary Identifiable Intangible Assets Acquired and their Estimated Lives	The preliminary identifiable intangible assets and their estimated useful lives were as follows: Estimated Estimated Fair Value Useful Life MOI GP Developed technology 5 - 8 years $ 1,200,000 $ 7,200,000 In process research and development 7 years 200,000 — Trade names and trademarks 3 years 150,000 400,000 Customer base 7 - 15 years 100,000 600,000 $ 1,650,000 $ 8,200,000
Unaudited Pro Forma Financial Information	The following unaudited pro forma financial information presents combined results of operations for each of the periods presented as if the acquisitions of MOI and GP had been completed on January 1, 2018. The pro forma information includes adjustments to depreciation expense for property and equipment acquired, to amortize expense for the intangible assets acquired, and to eliminate the acquisition transaction expenses recognized in each period. Transaction-related expenses associated with the acquisition and excluded from the pro forma loss from continuing operations were $0.9 million and $0 for the three months ended March 31, 2019 and 2018 , respectively. The pro forma data are for informational purposes only and are not necessarily indicative of the consolidated results of operations or the combined business had the acquisitions of MOI and GP actually occurred on January 1, 2018, or the results of future operations of the combined business. For instance, planned or expected operational synergies following the acquisition are not reflected in the pro forma information. Consequently, actual results will differ from the unaudited pro forma information presented below. Three Months Ended March 31, 2019 2018 Revenue $ 16,862,410 $ 13,118,836 Income/(loss) from continuing operations $ 2,337,820 $ (343,496 )

Discontinued Operations (Tables

Discontinued Operations (Tables)	3 Months Ended
	Mar. 31, 2019
Discontinued Operations and Disposal Groups [Abstract]
Components of Discontinued Operations	The key components of net income from discontinued operations were as follows: Three Months Ended March 31, 2019 2018 (unaudited) Net revenues $ — $ 3,424,642 Cost of revenues — 2,238,150 Operating expenses — 698,023 Other income — 10,648 Income before income taxes — 499,117 Allocated tax expense — 78,363 Operating income from discontinued operations — 420,754 Net income from discontinued operations $ — $ 420,754

Goodwill (Tables)

Goodwill (Tables)	3 Months Ended
	Mar. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of goodwill	The changes in the carrying value of goodwill during the three months ended March 31, 2019 were as follows: Balance as of December 31, 2018 $ 101,008 Goodwill resulting from business combination - GP 10,315,490 Goodwill resulting from business combination - MOI (1) (71,249 ) Balance as of March 31, 2019 $ 10,345,249 (1) This is a measurement period adjustment.

Inventory (Tables)

Inventory (Tables)	3 Months Ended
	Mar. 31, 2019
Inventory Disclosure [Abstract]
Components of Inventory	Components of inventory were as follows: March 31, December 31, (unaudited) Finished goods $ 2,057,274 $ 1,339,832 Work-in-process 1,733,065 643,420 Raw materials 6,205,715 4,890,490 Total inventory $ 9,996,054 $ 6,873,742

Accrued Liabilities (Tables)

Accrued Liabilities (Tables)	3 Months Ended
	Mar. 31, 2019
Payables and Accruals [Abstract]
Schedule of Accrued Liabilities	Accrued liabilities at March 31, 2019 and December 31, 2018 consisted of the following: March 31, 2019 December 31, 2018 (unaudited) Accrued compensation $ 4,864,146 $ 4,467,587 Income tax payable 296,134 236,636 Accrued professional fees 107,000 198,062 Deferred Rent — 146,542 Current operating lease liability 1,374,060 — Current finance lease liability 45,982 — Royalties 84,535 302,428 Accrued interest 1,615 — Accrued liabilities - other 1,282,770 404,752 Liability to related party — 298,468 Working capital payable 542,983 542,983 Total accrued liabilities $ 8,599,225 $ 6,597,458

Debt (Tables)

Debt (Tables)	3 Months Ended
	Mar. 31, 2019
Debt Disclosure [Abstract]
Summary of Debt Outstanding	The following table presents a summary of debt outstanding as of March 31, 2019 and December 31, 2018 : March 31, 2019 December 31, 2018 (unaudited) Silicon Valley Bank Term Loan $ 250,000 $ 625,000 Less: unamortized debt issuance costs 2,274 5,685 Less: current portion 247,726 619,315 Total long-term debt $ — $ —

Leases (Tables)

Leases (Tables)	3 Months Ended
	Mar. 31, 2019
Leases [Abstract]
Schedule of lease components	As of March 31, 2019 , the Company's lease components included in the consolidated balance sheet were as follows: Lease component Classification March 31, 2019 Assets ROU assets - operating lease Other assets $ 3,142,208 ROU assets - finance lease Other assets 27,738 Total ROU assets $ 3,169,946 Liabilities Current operating lease liability Accrued liabilities $ 1,374,060 Current finance lease liability Accrued liabilities 45,982 Long-term operating lease liability Other liabilities 2,914,504 Long-term finance lease liability Other liabilities 56,375 Total lease liabilities $ 4,390,921
Schedule of rent expense	Rent expense is recognized on a straight-line basis over the life of the lease. Rent expense consists of the following: Three months ended March 31, 2019 Operating lease costs $ 403,899 Variable rent costs (36,161 ) Total rent expense $ 367,738
Schedule of future minimum lease payments	Future minimum lease payments under non-cancellable leases were as follows: March 31, 2019 2019 - remaining 9 months $ 1,218,577 2020 1,467,701 2021 640,800 2022 544,704 2023 544,704 2024 and beyond 544,704 Total future minimum lease payments $ 4,961,190 Less: Interest 672,626 Total operating lease liabilities $ 4,288,564 Current operating lease liability $ 1,374,060 Long-term operating lease liability 2,914,504 Total operating lease liabilities $ 4,288,564
Schedule of other information related to leases	Other information related to leases is as follows: Three months ended March 31, 2019 Finance lease cost: Amortization of right-of-use assets $ 12,808 Interest on lease liabilities 2,176 Total finance lease cost $ 14,984 Other information: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 403,899 Finance cash flows from finance leases $ 6,763 Right-of-use assets obtained in exchange for new operating lease liabilities — Right-of-use assets obtained in exchange for new finance lease liabilities $ 14,541 Weighted-average remaining lease term - operating leases 4.0 Weighted-average remaining lease term - finance leases 2.7 Weighted-average discount rate - operating leases 7 % Weighted-average discount rate - finance leases 7 %

Capital Stock and Share-Based_2

Capital Stock and Share-Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2019
Equity [Abstract]
Summary of Stock Option Activity	A summary of the stock option activity for the three months ended March 31, 2019 is presented below: Options Outstanding Options Exercisable Number of Shares Price per Share Weighted Average Exercise Price Aggregate Intrinsic Value (1) Number of Shares Weighted Average Exercise Price Aggregate Intrinsic Value (1) Balance, January 1, 2018 3,108,868 $0.61 - $6.55 $ 2.26 $ 3,669,794 1,986,740 $ 1.81 $ 3,314,494 Granted 565,070 $3.21 - $3.37 Exercised (260,344 ) $1.18 - $1.80 Canceled (1,469 ) 1.47 Balance, March 31, 2019 3,412,125 $0.61 - $6.23 $ 2.48 $ 5,844,998 1,810,984 $ 1.91 $ 4,170,283 (1) The intrinsic value of an option represents the amount by which the market value of the stock exceeds the exercise price of the option of in-the-money options only. The aggregate intrinsic value is based on the closing price of our common stock on the Nasdaq Capital Market, as applicable, on the respective dates.
Summary of Restricted Stock Awards and Units	The following is a summary of our stock unit activity under the Deferred Compensation Plan for the three months ended March 31, 2019 : Number of Stock Units Weighted Average Grant Date Fair Value per Share Intrinsic Value Outstanding Balance, January 1, 2019 507,290 $1.53 $ 1,699,422 Granted 9,104 3.35 Forfeitures — — Converted — — Balance, March 31, 2019 516,394 $1.56 $ 2,153,363 The following table summarizes the value of our unvested restricted stock awards and restricted stock units: Number of Unvested Shares Weighted Average Grant Date Fair Value Aggregate Grant Date Fair Value of Unvested Shares Balance, January 1, 2019 458,620 $ 2.56 $ 1,172,456 Granted 230,000 $ 2.97 683,430 Vested — — — Forfeitures — — — Balance, March 31, 2019 688,620 $ 2.70 $ 1,855,886
Details of Equity Transactions	The following table details our equity transactions during the three months ended March 31, 2019 : Preferred Stock Common Stock Treasury Stock Additional Paid-in Capital Accumulated Deficit Total Shares $ Shares $ Shares $ $ Balance at January 1, 2019, as previously reported 1,321,514 1,322 27,956,401 30,120 1,253,105 (2,116,640 ) 85,744,750 (21,305,222 ) 62,354,330 Exercise of stock options — — 189,312 189 — — 184,769 — 184,958 Share-based compensation — — — — — — 342,765 — 342,765 Non-cash compensation — — — — — — — — — Stock dividends to Carilion Clinic (1) — — — 20 — — 83,038 (83,058 ) — Net Income — — — — — — — 1,125,879 1,125,879 Purchase of treasury stock — — — — — — — — — Balance, March 31, 2019 1,321,514 1,322 28,145,713 30,329 1,253,105 (2,116,640 ) 86,355,322 (20,262,401 ) 64,007,932 (1) The stock dividends payable in connection with Carilion Clinic’s Series A Preferred Stock will be issued subsequent to March 31, 2019 . For the period from January 12, 2010, the original issue date of the Series A Preferred Stock, through March 31, 2019 , the Series A Preferred Stock issued to Carilion has accrued $1,500,692 in dividends. The accrued and unpaid dividends as of March 31, 2019 will be paid by the issuance of 730,808 shares of our common stock upon Carilion’s written request.

Revenue Recognition (Tables)

Revenue Recognition (Tables)	3 Months Ended
	Mar. 31, 2019
Revenue from Contract with Customer [Abstract]
Schedule of Disaggregation of Revenue	The details are listed in the table below for the periods ending March 31, 2019 and 2018 : Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 (unaudited) (unaudited) Technology Development Products and Licensing Total Technology Development Products and Licensing Total Total Revenue by Geographic Location United States $ 6,640,743 $ 3,919,943 $ 10,560,686 $ 4,636,776 $ 2,441,496 $ 7,078,272 Asia — 2,406,002 2,406,002 — 1,003,133 1,003,133 Europe — 1,655,307 1,655,307 — 587,406 587,406 Canada, Central and South America — 181,185 181,185 — 97,719 97,719 All Others — 29,938 29,938 — 2,000 2,000 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530 Total Revenue by Major Customer Type Sales to the U.S. government $ 6,475,448 $ 785,223 $ 7,260,671 $ 4,605,154 $ 10,357 $ 4,615,511 U.S. direct commercial sales and other 165,295 3,134,720 3,300,015 31,622 2,441,721 2,473,343 Foreign commercial sales & other — 4,272,432 4,272,432 — 1,679,676 1,679,676 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530 Total Revenue by Contract Type Fixed-price contracts $ 3,662,434 $ 8,192,375 $ 11,854,809 $ 2,231,654 $ 4,131,754 $ 6,363,408 Cost-type contracts 2,978,309 — 2,978,309 2,405,122 — 2,405,122 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530 Total Revenue by Timing of Recognition Goods transferred at a point in time $ — $ 7,595,593 $ 7,595,593 $ — $ 3,964,349 $ 3,964,349 Goods/services transferred over time 6,640,743 596,782 7,237,525 4,636,776 167,405 4,804,181 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530 Total Revenue by Major Products/Services Technology development $ 6,640,743 $ — $ 6,640,743 $ 4,636,776 $ — $ 4,636,776 Optical test and measurement systems — 7,343,193 7,343,193 — 3,688,009 3,688,009 Other — 849,182 849,182 — 443,745 443,745 Total $ 6,640,743 $ 8,192,375 $ 14,833,118 $ 4,636,776 $ 4,131,754 $ 8,768,530
Schedule of components of contract balances	The following table shows the components of our contract balances as of March 31, 2019 and December 31, 2018 : March 31, 2019 December 31, 2018 Contract assets $ 3,188,352 $ 2,759,315 Contract liabilities (2,792,119 ) (2,486,111 ) Net contract assets (liabilities) $ 396,233 $ 273,204

Operating Segments (Tables)

Operating Segments (Tables)	3 Months Ended
	Mar. 31, 2019
Segment Reporting [Abstract]
Schedule of Revenues, Operating Income (Loss) and Assets for Reportable Segments	The table below presents revenues and operating income/(loss) for reportable segments: Three Months Ended March 31, 2019 2018 (unaudited) Revenues: Technology development $ 6,640,743 $ 4,636,776 Products and licensing 8,192,375 4,131,754 Total revenues $ 14,833,118 $ 8,768,530 Technology development operating income/(loss) $ 64,237 $ 99,234 Products and licensing operating income/(loss) (961,815 ) (14,983 ) Total operating income/(loss) $ (897,578 ) $ 84,251 Depreciation, technology development $ 98,395 $ 93,600 Depreciation, products and licensing $ 158,990 $ 64,317 Amortization, technology development $ 27,932 $ 37,206 Amortization, products and licensing $ 331,992 $ 112,729 The table below presents assets for reportable segments: March 31, December 31, (unaudited) Total segment assets: Technology development $ 32,331,533 $ 34,823,525 Products and licensing 51,232,275 40,775,211 Total assets $ 83,563,808 $ 75,598,736 Property plant and equipment, and intangible assets, technology development $ 2,162,062 $ 2,103,711 Property plant and equipment, and intangible assets, products and licensing $ 23,338,116 $ 4,927,453

Basis of Presentation and Sig_4

Basis of Presentation and Significant Accounting Policies - Additional Information (Details) - shares shares in Millions	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Accounting Policies [Abstract]
Common stock equivalents included in diluted per share data (in shares)	5.4	4

Basis of Presentation and Sig_5

Basis of Presentation and Significant Accounting Policies - Schedule of the Cumulative Effect of Adoption of Topic 842 (Details) - USD ($)	Mar. 31, 2019	Jan. 01, 2019	Dec. 31, 2018
Assets
Property and equipment, net	$ 3,845,748	$ 3,601,882	$ 3,627,886
Other assets, net	3,205,983	3,473,638	1,995
Liabilities:
Accrued liabilities	8,599,225	7,840,127	6,597,458
Current portion of capital lease obligations	0	0	40,586
Long-term deferred rent	0	0	1,035,974
Long-term operating lease liability	2,914,504	3,271,705
Long-term capital lease obligations	0	0	$ 68,978
Long-term finance lease liability	$ 27,738	76,803
Accounting Standards Update 2016-02
Assets
Property and equipment, net		(26,004)
Other assets, net		3,471,643
Liabilities:
Accrued liabilities		1,242,669
Current portion of capital lease obligations		(40,586)
Long-term deferred rent		(1,035,974)
Long-term operating lease liability		3,271,705
Long-term capital lease obligations		(68,978)
Long-term finance lease liability		$ 76,803

Business Combinations - Additio

Business Combinations - Additional Information (Details) - USD ($)	Mar. 01, 2019	Oct. 15, 2018	Mar. 31, 2019	Mar. 31, 2019	Mar. 31, 2018
Business Acquisition [Line Items]
Cash consideration				$ 19,004,250	$ 0
Acquisition costs					$ 0
Micron Optics, Inc.
Business Acquisition [Line Items]
Cash consideration		$ 5,500,000		5,000,000
Liabilities assumed		$ 500,000
Acquisition costs				800,000
Revenue recognized since acquisition				2,700,000
Loss since acquisition				(700,000)
General Photonics, Inc.
Business Acquisition [Line Items]
Cash consideration	$ 19,000,000
Cash paid at closing	17,100,000
Amount at closing placed in escrow	1,900,000
Potential maximum obligation of contingent consideration	$ 1,000,000
Contingent obligation			$ 900,000	900,000
Acquisition costs				$ 900,000
Revenue recognized since acquisition			700,000
Loss since acquisition			200,000
Amortization			$ 200,000
Developed technology | Micron Optics, Inc.
Business Acquisition [Line Items]
Discount rate used to estimate fair value of acquired finite-lived intangible assets		24.50%
Developed technology | General Photonics, Inc.
Business Acquisition [Line Items]
Discount rate used to estimate fair value of acquired finite-lived intangible assets	17.00%
In process research and development | Micron Optics, Inc.
Business Acquisition [Line Items]
Discount rate used to estimate fair value of acquired finite-lived intangible assets		29.50%
Customer base | Micron Optics, Inc.
Business Acquisition [Line Items]
Discount rate used to estimate fair value of acquired finite-lived intangible assets		24.50%
Customer base | General Photonics, Inc.
Business Acquisition [Line Items]
Discount rate used to estimate fair value of acquired finite-lived intangible assets	16.00%
Trade names and trademarks | Micron Optics, Inc.
Business Acquisition [Line Items]
Discount rate used to estimate fair value of acquired finite-lived intangible assets		17.00%
Trade names and trademarks | General Photonics, Inc.
Business Acquisition [Line Items]
Discount rate used to estimate fair value of acquired finite-lived intangible assets	16.00%

Business Combinations - Allocat

Business Combinations - Allocation of Purchase Consideration (Details) - USD ($)	Mar. 31, 2019	Mar. 01, 2019	Dec. 31, 2018	Oct. 15, 2018
Business Acquisition [Line Items]
Goodwill	$ 10,345,249		$ 101,008
Micron Optics, Inc.
Business Acquisition [Line Items]
Accounts receivable				$ 1,742,693
Inventory				1,435,606
Other current assets				69,951
Property and equipment				996,460
Identifiable intangible assets				1,650,000
Goodwill				101,008
Accounts payable and accrued expenses				(450,985)
Total purchase consideration				$ 5,544,733
General Photonics, Inc.
Business Acquisition [Line Items]
Accounts receivable		$ 1,520,950
Inventory		2,698,000
Other current assets		763,873
Property and equipment		286,000
Identifiable intangible assets		8,200,000
Goodwill		10,315,490
Accounts payable and accrued expenses		(3,880,063)
Total purchase consideration		$ 19,904,250

Business Combinations - Schedul

Business Combinations - Schedule of Preliminary Identifiable Intangible Assets Acquired (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 01, 2019	Oct. 15, 2018
Micron Optics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets			$ 1,650,000
General Photonics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets		$ 8,200,000
Developed technology | Micron Optics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets			1,200,000
Developed technology | General Photonics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets		7,200,000
In process research and development
Business Acquisition [Line Items]
Acquired assets expected useful lives	7 years
In process research and development | Micron Optics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets			200,000
In process research and development | General Photonics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets		0
Trade names and trademarks
Business Acquisition [Line Items]
Acquired assets expected useful lives	3 years
Trade names and trademarks | Micron Optics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets			150,000
Trade names and trademarks | General Photonics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets		400,000
Customer base | Micron Optics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets			$ 100,000
Customer base | General Photonics, Inc.
Business Acquisition [Line Items]
Identifiable intangible assets		$ 600,000
Minimum | Developed technology
Business Acquisition [Line Items]
Acquired assets expected useful lives	5 years
Minimum | Customer base
Business Acquisition [Line Items]
Acquired assets expected useful lives	7 years
Maximum | Developed technology
Business Acquisition [Line Items]
Acquired assets expected useful lives	8 years
Maximum | Customer base
Business Acquisition [Line Items]
Acquired assets expected useful lives	15 years

Business Combinations - Unaudit

Business Combinations - Unaudited Pro Forma Financial Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Business Combinations [Abstract]
Revenue	$ 16,862,410	$ 13,118,836
Income/(loss) from continuing operations	$ 2,337,820	$ (343,496)

Discontinued Operations - Addit

Discontinued Operations - Additional Information (Details) - USD ($) $ in Millions	Jul. 31, 2018	Mar. 31, 2018
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash flows used in operating activities for discontinued operations		$ 0.1
Cash flows used in investing activities for discontinued operations		$ 0.1
Optoelectronic Components and Subassemblies | Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Initial purchase price	$ 18.5
Proceeds from sales of discontinued operations	17.5
Contingent consideration on discontinued operation	$ 1

Discontinued Operations - Compo

Discontinued Operations - Components of Income from Discontinued Operations (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Discontinued Operations and Disposal Groups [Abstract]
Net revenues	$ 0	$ 3,424,642
Cost of revenues	0	2,238,150
Operating expenses	0	698,023
Other income	0	10,648
Income before income taxes	0	499,117
Allocated tax expense	0	78,363
Operating income from discontinued operations	0	420,754
Net income from discontinued operations	$ 0	$ 420,754

Goodwill (Details)

Goodwill (Details)	3 Months Ended
	Mar. 31, 2019USD ($)
Goodwill [Roll Forward]
Balance as of December 31, 2018	$ 101,008
Goodwill resulting from business combination - GP	10,315,490
Goodwill resulting from business combination - MOI	(71,249)
Balance as of March 31, 2019	$ 10,345,249

Inventory (Details)

Inventory (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Finished goods	$ 2,057,274	$ 1,339,832
Work-in-process	1,733,065	643,420
Raw materials	6,205,715	4,890,490
Total inventory	$ 9,996,054	$ 6,873,742

Accrued Liabilities (Details)

Accrued Liabilities (Details) - USD ($)	Mar. 31, 2019	Jan. 01, 2019	Dec. 31, 2018
Payables and Accruals [Abstract]
Accrued compensation	$ 4,864,146		$ 4,467,587
Income tax payable	296,134		236,636
Accrued professional fees	107,000		198,062
Current operating lease liability			146,542
Current operating lease liability	1,374,060
Current finance lease liability	45,982
Royalties	84,535		302,428
Accrued interest	1,615		0
Accrued liabilities - other	1,282,770		404,752
Liability to related party	0		298,468
Working capital payable	542,983		542,983
Total accrued liabilities	$ 8,599,225	$ 7,840,127	$ 6,597,458

Debt - Additional Information (

Debt - Additional Information (Details)	1 Months Ended	3 Months Ended
	Sep. 30, 2015USD ($)installment	Mar. 31, 2019USD ($)installment	Dec. 31, 2018USD ($)
Debt Instrument [Line Items]
Aggregate term loan balance		$ 250,000	$ 625,000
Term Loan | Silicon Valley Bank
Debt Instrument [Line Items]
Debt, face amount		$ 6,000,000
Debt, number of monthly payment | installment		48
Early termination fee		2.00%
Aggregate term loan balance		$ 300,000	$ 600,000
Effective interest rate		7.50%
Term Loan | Silicon Valley Bank | Prime Rate
Debt Instrument [Line Items]
Debt, additional interest above prime rate		2.00%
Term Loan | Silicon Valley Bank | Sixth Loan Modification Agreement
Debt Instrument [Line Items]
Debt, monthly principal payments		$ 125,000
Term Loan | Silicon Valley Bank | Seventh Loan Modification Agreement
Debt Instrument [Line Items]
Debt, face amount	$ 1,000,000
Debt, number of monthly payment | installment	35
Debt, monthly principal payments	$ 27,778
Debt, additional interest above prime rate	2.00%
Minimum cash balance	$ 4,000,000
Liquidity covenant component, accounts receivable percentage	60.00%
Liquidity covenant component, outstanding principal loan balance multiplier	1.5

Debt - Summary of Debt Outstand

Debt - Summary of Debt Outstanding (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Debt Disclosure [Abstract]
Silicon Valley Bank Term Loan	$ 250,000	$ 625,000
Less: unamortized debt issuance costs	2,274	5,685
Less: current portion	247,726	619,315
Long-term ROU lease liability - Finance lease	$ 0	$ 0

Leases - Additional Information

Leases - Additional Information (Details)	3 Months Ended
	Mar. 31, 2019
Office equipment
Lessee, Lease, Description [Line Items]
Useful life	5 years
Minimum
Lessee, Lease, Description [Line Items]
Operating leases contract terms	1 year
Finance leases contract terms	1 year
Maximum
Lessee, Lease, Description [Line Items]
Operating leases contract terms	5 years
Finance leases contract terms	4 years

Leases - Lease Components (Deta

Leases - Lease Components (Details) - USD ($)	Mar. 31, 2019	Jan. 01, 2019
Leases [Abstract]
ROU assets - operating lease	$ 3,142,208
ROU assets - finance lease	27,738	$ 76,803
Total ROU assets	3,169,946
Current operating lease liability	1,374,060
Current finance lease liability	45,982
Long-term finance lease liability	2,914,504	$ 3,271,705
Long-term finance lease liability	56,375
Total lease liabilities	$ 4,390,921

Leases - Rent Expense (Details)

Leases - Rent Expense (Details)	3 Months Ended
	Mar. 31, 2019USD ($)
Leases [Abstract]
Operating lease costs	$ 403,899
Variable rent costs	(36,161)
Total rent expense	$ 367,738

Leases - Future Lease Payments

Leases - Future Lease Payments (Details) - USD ($)	Mar. 31, 2019	Jan. 01, 2019
Leases [Abstract]
2019 - remaining 9 months	$ 1,218,577
2020	1,467,701
2021	640,800
2022	544,704
2023	544,704
2024 and beyond	544,704
Total future minimum lease payments	4,961,190
Less: Interest	672,626
Total operating lease liabilities	4,288,564
Current operating lease liability	1,374,060
Long-term operating lease liability	$ 2,914,504	$ 3,271,705

Leases - Other Lease Informatio

Leases - Other Lease Information (Details)	3 Months Ended
	Mar. 31, 2019USD ($)
Finance lease cost:
Amortization of right-of-use assets	$ 12,808
Interest on lease liabilities	2,176
Total finance lease cost	14,984
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	403,899
Finance cash flows from finance leases	6,763
Right-of-use assets obtained in exchange for new operating lease liabilities	0
Right-of-use assets obtained in exchange for new finance lease liabilities	$ 14,541
Weighted-average remaining lease term - operating leases	4 years 3 days
Weighted-average remaining lease term - finance leases	2 years 8 months 12 days
Weighted-average discount rate - operating leases	7.00%
Weighted-average discount rate - finance leases	7.00%

Capital Stock and Share-Based_3

Capital Stock and Share-Based Compensation - Additional Information (Details)	3 Months Ended
	Mar. 31, 2019USD ($)installmentshares	Mar. 31, 2018USD ($)	Dec. 31, 2018shares
Equity [Abstract]
Expected dividend yield	0.00%
Aggregate outstanding stock options (in shares)	3,412,125		3,108,868
Outstanding stock options, weighted average remaining contractual term	6 years 5 months
Exercisable stock options (in shares)	1,810,984		1,986,740
Exercisable stock options, weighted average remaining contractual term	3 years 7 months
Fair value of shares vested | $	$ 7,600,000
Fair value of options exercised during period | $	400,470
Share-based compensation | $	342,765	$ 94,606
Stock-based compensation expense not yet recognized | $	$ 3,300,000
Weighted average remaining service period	3 years 2 months 12 days
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares)	230,000
Shares not yet vested (in shares)	688,620		458,620
Shares vested (in shares)	0
Employees | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares)	230,000
Number of vesting installments | installment	3
Employees | Restricted Stock Units (RSUs) | Vest in three equal annual installments on the anniversary dates of grant
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares not yet vested (in shares)	167,000
Employees | Restricted Stock Units (RSUs) | Vest based on levels of 2201 revenue and operating income
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares not yet vested (in shares)	63,000
Target performance as as percent of revenue and operating income	150.00%
Payout of shares upon achievement of target performance	42,000
Directors | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period, earlier of grant anniversary, or annual stockholders' meeting	1 year
Shares vested (in shares)	0
Employee Director Compensation Plan | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares not yet vested (in shares)	48,859

Capital Stock and Share-Based_4

Capital Stock and Share-Based Compensation - Summary of Activity of Equity Incentive Plans (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Options Outstanding, Number of Shares
Beginning Balance (shares)	3,108,868
Granted (in shares)	565,070
Exercised (in shares)	(260,344)
Canceled (in shares)	(1,469)
Ending Balance (shares)	3,412,125	3,108,868
Price per Share Range
Outstanding, lower limit (in dollars per share)	$ 0.61	$ 0.61
Outstanding, upper limit (in dollars per share)	6.23	6.55
Granted, lower limit (in dollars per share)	3.21
Granted, upper limit (in dollars per share)	3.37
Exercised, lower limit (in dollars per share)	1.18
Exercised, upper limit (in dollars per share)	1.80
Canceled (in dollars per share)	1.47
Options Outstanding, Weighted Average Exercise Price
Beginning balance (in dollars per share)	2.26
Granted (in dollars per share)
Exercised (in dollars per share)
Canceled (in dollars per share)
Ending balance (in dollars per share)	$ 2.48	$ 2.26
Additional Disclosures
Options outstanding, aggregate intrinsic value	$ 5,844,998	$ 3,669,794
Exercisable stock options (in shares)	1,810,984	1,986,740
Options exercisable, weighted average exercise price (in dollars per share)	$ 1.91	$ 1.81
Options exercisable, aggregate intrinsic value	$ 4,170,283	$ 3,314,494

Capital Stock and Share-Based_5

Capital Stock and Share-Based Compensation - Summary of Restricted Awards (Details)	3 Months Ended
	Mar. 31, 2019USD ($)$ / sharesshares
Number of Unvested Shares
Beginning balance (in shares) | shares	458,620
Granted (in shares) | shares	230,000
Vested (in shares) | shares	0
Forfeitures (in shares) | shares	0
Ending balance (in shares) | shares	688,620
Weighted Average Grant Date Fair Value
Beginning balance (in usd per share) | $ / shares	$ 2.56
Granted (in usd per share) | $ / shares	2.97
Vested (in usd per share) | $ / shares	0
Forfeitures (in usd per share) | $ / shares	0
Ending balance (in usd per share) | $ / shares	$ 2.70
Aggregate Grant Date Fair Value of Unvested Shares
Aggregate grant date fair value of shares, Beginning balance | $	$ 1,172,456
Aggregate grant date fair value of shares, Granted | $	683,430
Aggregate grant date fair value of shares, Vested | $	0
Aggregate grant date fair value of shares, Forfeitures | $	0
Aggregate grant date fair value of shares, Ending balance | $	$ 1,855,886

Capital Stock and Share-Based_6

Capital Stock and Share-Based Compensation - Summary of Restricted Stock Units (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Weighted Average Grant Date Fair Value
Beginning balance (in usd per share)	$ 2.56
Granted (in usd per share)	2.97
Forfeitures (in usd per share)	0
Ending balance (in usd per share)	$ 2.70
Intrinsic value, outstanding	$ 1,855,886	$ 1,172,456
Restricted Stock Units (RSUs) | Employee Director Compensation Plan
Number of Stock Units
Beginning balance (in shares)	507,290
Granted (in shares)	9,104
Forfeitures (in shares)	0
Converted (in shares)	0
Ending balance (in shares)	516,394
Weighted Average Grant Date Fair Value
Beginning balance (in usd per share)	$ 1.53
Granted (in usd per share)	3.35
Forfeitures (in usd per share)	0
Converted (in usd per share)	0
Ending balance (in usd per share)	$ 1.56
Intrinsic value, outstanding	$ 2,153,363	$ 1,699,422

Capital Stock and Share-Based_7

Capital Stock and Share-Based Compensation - Equity Transactions (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Increase (Decrease) in Stockholders' Equity
Preferred stock beginning balance (in shares)	1,321,514
Common stock beginning balance (in shares)	27,956,401
Treasury stock beginning balance (in shares)	1,253,105
Stockholder's equity beginning balance	$ 62,354,330
Exercise of stock options (in shares)	260,344
Exercise of stock options	$ 184,958
Share-based compensation	342,765
Non-cash compensation	0
Stock dividends to Carilion Clinic	0
Net Income	1,125,879	$ 148,676
Purchase of treasury stock	$ 0
Preferred stock ending balance (in shares)	1,321,514
Common stock ending balance (in shares)	28,145,713
Treasury stock ending balance (in shares)	1,253,105
Stockholder's equity ending balance	$ 64,007,932
Carilion Clinic | Series A Preferred Stock
Increase (Decrease) in Stockholders' Equity
Accrued dividends	$ 1,500,692
Stock dividends for preferred shareholders (in shares)	730,808
Preferred Stock
Increase (Decrease) in Stockholders' Equity
Preferred stock beginning balance (in shares)	1,321,514
Stockholder's equity beginning balance	$ 1,322
Preferred stock ending balance (in shares)	1,321,514
Stockholder's equity ending balance	$ 1,322
Common Stock
Increase (Decrease) in Stockholders' Equity
Common stock beginning balance (in shares)	27,956,401
Stockholder's equity beginning balance	$ 30,120
Exercise of stock options (in shares)	189,312
Exercise of stock options	$ 189
Stock dividends to Carilion Clinic	$ 20
Common stock ending balance (in shares)	28,145,713
Stockholder's equity ending balance	$ 30,329
Treasury Stock
Increase (Decrease) in Stockholders' Equity
Treasury stock beginning balance (in shares)	1,253,105
Stockholder's equity beginning balance	$ (2,116,640)
Treasury stock ending balance (in shares)	1,253,105
Stockholder's equity ending balance	$ (2,116,640)
Additional Paid-in Capital
Increase (Decrease) in Stockholders' Equity
Stockholder's equity beginning balance	85,744,750
Exercise of stock options	184,769
Share-based compensation	342,765
Stock dividends to Carilion Clinic	83,038
Stockholder's equity ending balance	86,355,322
Accumulated Deficit
Increase (Decrease) in Stockholders' Equity
Stockholder's equity beginning balance	(21,305,222)
Stock dividends to Carilion Clinic	(83,058)
Net Income	1,125,879
Stockholder's equity ending balance	$ (20,262,401)

Capital Stock and Share-Based_8

Capital Stock and Share-Based Compensation - Stock Repurchase Program (Details) - USD ($)	Sep. 19, 2018	May 31, 2017	Sep. 30, 2017	May 31, 2016
Equity [Abstract]
Authorized share repurchase amount			$ 2,000,000	$ 2,000,000
Treasury shares repurchased (in shares)	565,629	205,500
Amount of stock repurchased	$ 1,100,000	$ 200,000

Revenue Recognition - Schedule

Revenue Recognition - Schedule of Disaggregation of Revenue (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Disaggregation of Revenue [Line Items]
Total revenues	$ 14,833,118	$ 8,768,530
Technology development
Disaggregation of Revenue [Line Items]
Total revenues	6,640,743	4,636,776
Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	8,192,375	4,131,754
Technology development
Disaggregation of Revenue [Line Items]
Total revenues	6,640,743	4,636,776
Technology development | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	6,640,743	4,636,776
Technology development | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	0	0
Optical test and measurement systems
Disaggregation of Revenue [Line Items]
Total revenues	7,343,193	3,688,009
Optical test and measurement systems | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	0	0
Optical test and measurement systems | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	7,343,193	3,688,009
Other
Disaggregation of Revenue [Line Items]
Total revenues	849,182	443,745
Other | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	0	0
Other | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	849,182	443,745
Goods transferred at a point in time
Disaggregation of Revenue [Line Items]
Total revenues	7,595,593	3,964,349
Goods transferred at a point in time | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	0	0
Goods transferred at a point in time | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	7,595,593	3,964,349
Goods/services transferred over time
Disaggregation of Revenue [Line Items]
Total revenues	7,237,525	4,804,181
Goods/services transferred over time | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	6,640,743	4,636,776
Goods/services transferred over time | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	596,782	167,405
Fixed-price contracts
Disaggregation of Revenue [Line Items]
Total revenues	11,854,809	6,363,408
Fixed-price contracts | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	3,662,434	2,231,654
Fixed-price contracts | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	8,192,375	4,131,754
Cost-type contracts
Disaggregation of Revenue [Line Items]
Total revenues	2,978,309	2,405,122
Cost-type contracts | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	2,978,309	2,405,122
Cost-type contracts | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	0	0
Sales to the U.S. government
Disaggregation of Revenue [Line Items]
Total revenues	7,260,671	4,615,511
Sales to the U.S. government | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	6,475,448	4,605,154
Sales to the U.S. government | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	785,223	10,357
U.S. direct commercial sales and other
Disaggregation of Revenue [Line Items]
Total revenues	3,300,015	2,473,343
U.S. direct commercial sales and other | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	165,295	31,622
U.S. direct commercial sales and other | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	3,134,720	2,441,721
Foreign commercial sales & other
Disaggregation of Revenue [Line Items]
Total revenues	4,272,432	1,679,676
Foreign commercial sales & other | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	0	0
Foreign commercial sales & other | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	4,272,432	1,679,676
United States
Disaggregation of Revenue [Line Items]
Total revenues	10,560,686	7,078,272
United States | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	6,640,743	4,636,776
United States | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	3,919,943	2,441,496
Asia
Disaggregation of Revenue [Line Items]
Total revenues	2,406,002	1,003,133
Asia | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	0	0
Asia | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	2,406,002	1,003,133
Europe
Disaggregation of Revenue [Line Items]
Total revenues	1,655,307	587,406
Europe | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	0	0
Europe | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	1,655,307	587,406
Canada, Central and South America
Disaggregation of Revenue [Line Items]
Total revenues	181,185	97,719
Canada, Central and South America | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	0	0
Canada, Central and South America | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	181,185	97,719
All Others
Disaggregation of Revenue [Line Items]
Total revenues	29,938	2,000
All Others | Technology development
Disaggregation of Revenue [Line Items]
Total revenues	0	0
All Others | Products and licensing
Disaggregation of Revenue [Line Items]
Total revenues	$ 29,938	$ 2,000

Revenue Recognition - Contract

Revenue Recognition - Contract Balances (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Revenue from Contract with Customer [Abstract]
Contract assets	$ 3,188,352	$ 2,759,315
Contract liabilities	2,792,119	2,486,111
Net contract assets (liabilities)	$ 396,233	$ 273,204

Revenue Recognition - Performan

Revenue Recognition - Performance Obligation Amount (Details) $ in Millions	Mar. 31, 2019USD ($)
Technology development
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Amount	$ 25.9
Products and licensing
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Amount	$ 15

Revenue Recognition - Perform_2

Revenue Recognition - Performance Obligation Percent (Details)	Mar. 31, 2019
Technology development | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Percentage	61.00%
Technology development | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Percentage	32.00%
Products and licensing | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Percentage	49.00%
Products and licensing | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Percentage	21.00%

Operating Segments - Additional

Operating Segments - Additional Information (Details) - segment	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting [Abstract]
Number of operating segments	2
Revenues | Government Contracts Concentration Risk | U.S. Government
Segment Reporting Information [Line Items]
Percentage of total consolidated revenues by customer	49.00%	41.00%
Revenues | Geographic Concentration Risk | Outside of the United States
Segment Reporting Information [Line Items]
Percentage of total consolidated revenues by customer	29.00%	22.00%

Operating Segments - Revenues a

Operating Segments - Revenues and Operating Income (Loss) for Reportable Segments Not Including Discontinued Operations (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenues:
Total revenues	$ 14,833,118	$ 8,768,530
Total operating income (loss)	(897,577)	(373,456)
Technology development
Revenues:
Total revenues	6,640,743	4,636,776
Depreciation	98,395	93,600
Amortization	27,932	37,206
Products and licensing
Revenues:
Total revenues	8,192,375	4,131,754
Depreciation	158,990	64,317
Amortization	331,992	112,729
Operating Segments
Revenues:
Total revenues	14,833,118	8,768,530
Total operating income (loss)	(897,578)	84,251
Operating Segments | Technology development
Revenues:
Total revenues	6,640,743	4,636,776
Total operating income (loss)	64,237	99,234
Operating Segments | Products and licensing
Revenues:
Total revenues	8,192,375	4,131,754
Total operating income (loss)	$ (961,815)	$ (14,983)

Operating Segments - Assets for

Operating Segments - Assets for Reportable Segments (Details) - USD ($)	Mar. 31, 2019	Jan. 01, 2019	Dec. 31, 2018
Total segment assets:
Total assets	$ 83,563,808		$ 75,598,736
Property plant and equipment, and intangible assets	3,845,748	$ 3,601,882	3,627,886
Technology development
Total segment assets:
Total assets	32,331,533		34,823,525
Property plant and equipment, and intangible assets	2,162,062		2,103,711
Products and licensing
Total segment assets:
Total assets	51,232,275		40,775,211
Property plant and equipment, and intangible assets	$ 23,338,116		$ 4,927,453

Contingencies and Guarantees (D

Contingencies and Guarantees (Details) - USD ($) $ in Millions	Jul. 31, 2018	Mar. 31, 2019	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Aug. 31, 2017
Tunable Lasers
Loss Contingencies [Line Items]
Non-cancelable purchase order delivery period			18 months
Non-cancelable purchase order commitment				$ 1.1	$ 0.5
Non-cancelable purchase order commitment remaining		$ 0.3
Macom
Loss Contingencies [Line Items]
Accounts receivable				$ 2
Disposed of by Sale | High Speed Optical Receivers Business | Macom
Loss Contingencies [Line Items]
Escrow deposits related to indemnity claims		2.5				$ 4
Amount of the escrow balance received		$ 1.5
Disposed of by Sale | Optoelectronic Components and Subassemblies
Loss Contingencies [Line Items]
Contingent consideration on discontinued operation	$ 1
Non-cancelable purchase order delivery period	18 months