Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 27, 2016 | Apr. 29, 2016 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | GigPeak, Inc. | |
Entity Central Index Key | 1,432,150 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 53,680,127 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 27, 2016 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 27, 2016 | Dec. 31, 2015 | |
Current assets: | |||
Cash and cash equivalents | $ 36,827 | $ 30,245 | |
Accounts receivable, net | 9,039 | 10,596 | [1] |
Inventories | 6,971 | 6,880 | [1] |
Prepaid and other current assets | 788 | 580 | [1] |
Total current assets | 53,625 | 48,301 | [1] |
Property and equipment, net | 2,919 | 3,133 | [1] |
Intangible assets, net | 4,210 | 4,530 | [1] |
Goodwill | 12,565 | 12,565 | [1] |
Restricted cash | 244 | 330 | [1] |
Other assets | 1,457 | 251 | [1] |
Total assets | 75,020 | 69,110 | [1] |
Current liabilities: | |||
Accounts payable | 3,866 | 3,659 | [1] |
Accrued compensation | 1,576 | 1,782 | [1] |
Other current liabilities | 2,296 | 2,219 | [1] |
Total current liabilities | 7,738 | 7,660 | [1] |
Pension liabilities | 354 | 349 | [1] |
Other long term liabilities | 911 | 912 | [1] |
Total liabilities | $ 9,003 | $ 8,921 | [1] |
Commitments and contingencies (Note 11) | [1] | ||
Redeemable common stock, $0.001 par value; 1,754,385 shares issued and outstanding as of March 27, 2016 | $ 4,700 | $ 0 | [1] |
Stockholders' equity: | |||
Preferred stock, $0.001 par value; 1,000,000 shares authorized; no shares issued and outstanding as of March 27, 2016 and December 31, 2015, respectively | 0 | 0 | [1] |
Common stock, $0.001 par value; 100,000,000 shares authorized; 45,533,389 and 45,221,397 shares issued and outstanding as of March 27, 2016 and December 31, 2015, respectively | 46 | 45 | [1] |
Additional paid-in capital | 164,203 | 163,036 | [1] |
Treasury stock, at cost; 701,754 shares as of March 27, 2016 and December 31, 2015, respectively | (2,209) | (2,209) | [1] |
Accumulated other comprehensive income | 344 | 332 | [1] |
Accumulated deficit | (101,067) | (101,015) | [1] |
Total stockholders' equity | 61,317 | 60,189 | [1] |
Total liabilities, redeemable common stock and stockholders' equity | $ 75,020 | $ 69,110 | [1] |
[1] | The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited consolidated financial statements as of that date. |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Mar. 27, 2016 | Dec. 31, 2015 | [1] |
LIABILITIES, REDEEMABLE COMMON STOCK AND STOCKHOLDERS' EQUITY | |||
Redeemable common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Redeemable common stock, issued (in shares) | 1,754,385 | ||
Redeemable common stock, outstanding (in shares) | 1,754,385 | ||
Stockholders' equity: | |||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Preferred stock, authorized (in shares) | 1,000,000 | 1,000,000 | |
Preferred stock, issued (in shares) | 0 | 0 | |
Preferred stock, outstanding (in shares) | 0 | 0 | |
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) | 45,533,389 | 45,221,397 | |
Common stock, outstanding (in shares) | 45,533,389 | 45,221,397 | |
Treasury stock, at cost (in shares) | 701,754 | 701,754 | |
[1] | The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited consolidated financial statements as of that date. |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) [Abstract] | ||
Total revenue | $ 11,362 | $ 9,060 |
Total cost of revenue | 3,683 | 3,667 |
Gross profit | 7,679 | 5,393 |
Operating expenses | ||
Research and development expense | 3,525 | 3,248 |
Selling, general and administrative expense | 4,162 | 2,770 |
Total operating expenses | 7,687 | 6,018 |
Loss from operations | (8) | (625) |
Interest expense, net | 0 | (3) |
Other income, net | (4) | 1 |
Loss before provision for income taxes | (12) | (627) |
Provision for income taxes | 40 | 9 |
Net loss | $ (52) | $ (636) |
Net loss per share - basic and diluted (in dollars per share) | $ 0 | $ (0.02) |
Weighted average number of shares used in basic and diluted net loss per share calculations (in shares) | 44,789 | 32,525 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS [Abstract] | ||
Net loss | $ (52) | $ (636) |
Other comprehensive income, net of tax | ||
Foreign currency translation adjustment | 12 | 20 |
Other comprehensive income, net of tax | 12 | 20 |
Comprehensive loss | $ (40) | $ (616) |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (52) | $ (636) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 963 | 890 |
Stock-based compensation | 1,285 | 889 |
Change in fair value of warrants | (9) | (1) |
Provision for doubtful accounts | (8) | (4) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 1,565 | (295) |
Inventories | (91) | (839) |
Prepaid and other current assets | (512) | (557) |
Other assets | (5) | (7) |
Accounts payable | 533 | 278 |
Accrued compensation | (206) | 539 |
Other current liabilities | 30 | (663) |
Other long-term liabilities | 0 | 79 |
Net cash provided by (used in) operating activities | 3,493 | (327) |
Cash flows from investing activities: | ||
Investment in private company | (1,200) | 0 |
Purchases of property and equipment | (694) | (416) |
Change in restricted cash | 86 | 0 |
Net cash used in investing activities | (1,808) | (416) |
Cash flows from financing activities: | ||
Proceeds from offering of stock, net of issuance costs | 5,000 | 0 |
Proceeds from issuance of stock | 278 | 28 |
Taxes paid related to net share settlement of equity awards | (395) | (90) |
Repayment of capital lease | (1) | (1) |
Net cash provided by (used in) financing activities | 4,882 | (63) |
Effect of exchange rates on cash and cash equivalents | 15 | 32 |
Net increase (decrease) in cash and cash equivalents | 6,582 | (774) |
Cash and cash equivalents at beginning of period | 30,245 | 18,438 |
Cash and cash equivalents at end of period | 36,827 | 17,664 |
Supplemental disclosure of cash flow information | ||
Interest paid | 7 | 4 |
Taxes paid | 64 | 0 |
Property and equipment acquired with accounts payable | 48 | 289 |
Offering costs included in accounts payable and other current liabilities | $ 300 | $ 0 |
ORGANIZATION AND BASIS OF PRESE
ORGANIZATION AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 27, 2016 | |
ORGANIZATION AND BASIS OF PRESENTATION [Abstract] | |
ORGANIZATION AND BASIS OF PRESENTATION | NOTE 1—ORGANIZATION AND BASIS OF PRESENTATION Organization GigPeak Inc. (formerly GigOptix, Inc.) (“GigPeak” or the “Company”) is a leading innovator of semiconductor integrated circuits (“ICs”) and software solutions for high-speed connectivity and high-quality video compression over the network and the Cloud. The Company’s focus is to develop and deliver products that enable lower power consumption and faster data connectivity, more efficient use of network infrastructure and broader connectivity to the Cloud, and reduce the total cost of ownership of existing network pipes from the core to the end user. GigPeak addresses both the speed of data transmission and the amount of bandwidth the data consumes within the network, and provides solutions that increase the efficiency of various cloud-connected applications, such as the Internet-of-Things (“IoT”), leveraging its strength in high-speed connectivity and, with the highest quality video compression assets that were acquired through the acquisition (the “Merger”) of Magnum Semiconductor, Inc. (“Magnum”) during the Company’s second fiscal quarter on April 5, 2016. The extended product portfolio provides more flexibility to support changing market requirements and customer’s dynamic road-maps, by way of using ICs and monolithic microwave integrated circuits (“MMICs”), and through full software programmability and cost efficient custom application specific integrated circuit (“ASICs”). The Company develops semiconductor ICs and software solutions for high-speed connectivity and high-quality video compression over the enterprise network and the Cloud. With its product focus, the Company attempts to reduce the total cost of ownership of existing network pipes, from the core of the network to the end user appliances and terminals. GigPeak addresses both the speed of data transmission and the amount of bandwidth the data consumes within the network, which are the two major data streaming bottlenecks, while also the future enabler factors, to maintain network efficiency. As such, the Company’s products also naturally provide solutions that increase the efficiency of IoT and other Cloud-connected applications. GigPeak’s solutions leverage its industry-recognized strength in high-speed connectivity delivered through the GigOptix brand-name product line, and as of the second fiscal quarter of 2016, the highest quality video compression delivered through the industry-recognized Magnum brand. The recently extended GigPeak product portfolio provides flexibility to better support on-going changes in the connectivity that customers and markets require by deploying a wide tool-box of solutions from various kinds of semiconductor materials, integrated circuits and Multi-Chip-Modules (“MCMs), through cost-effective ASICs and (“SoCs”), and into full software programmable open-platform offerings. The Company’s products are highly customized and typically developed in partnership with key “Lighthouse” customers, occasionally generating some engineering project revenues through the development stage, and where the largest revenue is generated from future device product shipments and sales through these customers and general market availability. Since inception in 2007, the Company has expanded its customer base by acquiring and integrating eight (8) companies with complementary and synergistic products and customers, and spun out one (1) business to establish a joint-venture. GigPeak’s worldwide direct sales force is supported by a significant number of channel representatives and distributors that sell its products throughout North America, South America, Europe, Japan and Asia. As noted above, on April 5, 2016, the Company completed its most recent acquisition of Magnum, and simultaneously renamed itself as GigPeak, Inc. Magnum is a fabless semiconductor manufacturer and software solution developer, and brings a well-developed and comprehensive portfolio of video broadcasting and compression solutions to GigPeak, including silicon ICs, SoCs, software solutions, and a comprehensive library of intellectual property. The Magnum products currently are for the professional video broadcast and are extendable to IoT camera markets. Magnum provides top of the line products, tools and technologies for the entire video content creation and distribution chain, from contribution and production through distribution over cable, telecom, satellite and over-the-top (“OTT”) video streaming. Through the acquisition of Magnum, the Company broadens its product offerings by adding additional flavors of silicon integrated circuits (“ICs”), and new SoCs, software, and intellectual property (“IP”) for the professional broadcast infrastructure market. Today’s video service providers, which include cable operators, telecommunications companies and satellite TV providers, are continuously seeking to perfect their linear and nonlinear workflows and improve the quality of their video content, while simultaneously optimizing the efficiency of their networks. The Company’s products, tools, and technologies are currently used in the entire video content creation and distribution chain. Specifically, GigPeak’s solutions are used to address challenges in video contribution, video production, primary and secondary distribution, and enterprise wide solutions. Over time, GigPeak will look to leverage those capabilities and seek opportunities to expand its offerings into new markets, such as potentially surveillance cameras and other video IoT applications. The blending of products and technologies gives GigPeak the capability to address both the speed of data transmission and the amount of bandwidth the data consumes within a network, driven in particular by the video content which is the source of a majority of the datacenter traffic and storage on today’s networks. Through this combination, the Company provides solutions to enhance the footprint utilization and reduce total cost of ownership of existing network pipes from the core to the end user. Its wide product portfolio and exceptional customer support practices, will continue to serve the enterprise networking and broadcasting original equipment manufacturers (“OEMs”), as well as IoT and other Cloud-connected consumers. With the acquisition of Magnum, the Company is in the process of reorganizing its operations to line up with its targeted end-markets and customers. This will eventually result later in fiscal 2016 in two business lines: the Enterprise Networking, which will be likely named the “GigOptix” product line, and the Consumer and Cloud-Connectivity, which will be likely named the “GigCloud” line. Most of the Company’s current product lines will contribute products to each one of those two business lines. Basis of Presentation The Company’s fiscal year ends on December 31. For quarterly reporting, the Company employs a five-week, four-week, four-week, reporting period. The first quarter of 2016 ended on Sunday, March 27, 2016. The first quarter of 2015 ended on Sunday, March 29, 2015. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements as of March 27, 2016 and for the three months ended March 27, 2016 and March 29, 2015, have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Article 10 of Securities and Exchange Commission (“SEC”) Regulation S-X. The statements include the accounts of the Company and all of its subsidiaries and they do not include all of the information and footnotes required by such accounting principles for annual financial statements. In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company’s financial position as of March 27, 2016, and the results of operations and cash flows for the three months ended March 27, 2016 and March 29, 2015. The condensed consolidated results of operations for the three months ended March 27, 2016 are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year ending December 31, 2016. 2015 Form 10-K. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reported periods. These judgments can be subjective and complex, and consequently, actual results could differ materially from those estimates and assumptions. Descriptions of these estimates and assumptions are included in the 2015 Form 10-K and the Company encourages you to read its 2015 Form 10-K for more information about such estimates and assumptions. Reclassifications Certain prior fiscal year balances have been reclassified to conform to the current fiscal year presentation. In the fourth quarter of 2015 the Company concluded that it was appropriate to classify certain accruals of trade payable items as accounts payable instead of other accrued liabilities. The reclassification has no effect on previously reported consolidated statements of operations or accumulated deficit for any period and does not affect previously reported cash flows from operating, investing or financing activities in the consolidated statements of cash flows. For comparability purposes, $446,000 of other current liabilities was reclassified to accounts payable as of March 29, 2015. Revenue Recognition Revenue from sales of optical drivers and receivers, multi-chip modulators, and other products is recognized when persuasive evidence of a sales arrangement exists, transfer of title occurs, the sales price is fixed or determinable and collection of the resulting receivable is reasonably assured. Reserves are made for warranties at the time revenue is recorded. See Note 11—Commitments and Contingencies for further detail related to the warranty reserve. Customer purchase orders are generally used to determine the existence of an arrangement. Transfer of title and risk of ownership occur based on defined terms in customer purchase orders, and generally pass to the customer upon shipment, at which point goods are delivered to a carrier. There are no formal customer acceptance terms or further obligations, outside of standard product warranty. The Company assesses whether the sales price is fixed or determinable based on the payment terms associated with the transaction. Collectability is assessed based primarily on the credit worthiness of the customer as determined through ongoing credit evaluations of the customer’s financial condition, as well as, consideration of the customer’s payment history. The Company records revenue from non-recurring engineering projects associated with product development that the Company enters into with certain customers. In general, these projects are associated with complex technology development, and as such the Company does not have certainty about its ability to achieve the program milestones. Achievement of the milestone is dependent on the Company’s performance and is typically accepted by the customer. The payment associated with achieving the milestone is generally commensurate with the Company’s effort or the value of the deliverable and is nonrefundable. Therefore, the Company records the expenses related to these projects in the periods incurred and recognizes revenue only when the Company has earned the revenue and achieved the development milestones. Revenue from these projects is typically recorded at 100% gross margin because the costs associated with these projects are expensed as incurred and generally included in research and development expense. These efforts generally benefit the Company’s overall product development programs beyond the specific project requested by our customer. The Company sells some products to distributors at the price listed in its price book for that distributor. Certain of the Company's distributor agreements provide for semi-annual stock rotation privileges of 5% to 10% of net sales for the previous six-month period. At the time of sale, the Company records a sales reserve for stock rotations approved by management. The Company offsets the sales reserve against revenues, producing the net revenue amount reported in the consolidated statements of operations. Each month the Company adjusts the sales reserve for the estimated stock rotation privilege anticipated to be utilized by the distributors. When the distributors pay the Company's invoices, they may claim stock rotations when appropriate. Once claimed, the Company processes the requests against the prior authorizations and reduces the reserve previously established for that customer. As of March 27, 2016 and December 31, 2015, the reserve for stock rotations was $125,000 and $490,000, respectively, and is recorded in other current liabilities on the consolidated balance sheets. The Company records transaction-based taxes including, but not limited to, sales, use, value added, and excise taxes, on a net basis in its consolidated statements of operations. |
BALANCE SHEET COMPONENTS
BALANCE SHEET COMPONENTS | 3 Months Ended |
Mar. 27, 2016 | |
BALANCE SHEET COMPONENTS [Abstract] | |
BALANCE SHEET COMPONENTS | NOTE 2—BALANCE SHEET COMPONENTS Accounts receivable, net consisted of the following (in thousands): March 27, December 31, 2016 2015 Accounts receivable $ 9,094 $ 10,659 Allowance for doubtful accounts (55 ) (63 ) $ 9,039 $ 10,596 Property and equipment, net consisted of the following (in thousands, except depreciable life): Life March 27, December 31, (In years) 2016 2015 Network and laboratory equipment 3 – 5 $ 13,660 $ 13,520 Computer software and equipment 2 – 3 4,227 4,207 Furniture and fixtures 3 – 7 165 165 Office equipment 3 – 5 143 142 Leasehold improvements 1 – 5 336 316 18,531 18,350 Accumulated depreciation and amortization (15,612 ) (15,217 ) Property and equipment, net $ 2,919 $ 3,133 For the three months ended March 27, 2016 and March 29, 2015, depreciation expense related to property and equipment was $338,000 and $415,000, respectively. In addition to the property and equipment above, the Company has prepaid licenses. For the three months ended March 27, 2016 and March 29, 2015, amortization related to these prepaid licenses was $305,000 and $252,000, respectively. Inventories consisted of the following (in thousands): March 27, December 31, 2016 2015 Raw materials $ 2,126 $ 2,379 Work in process 3,603 2,710 Finished goods 1,242 1,791 $ 6,971 $ 6,880 Accrued and other current liabilities consisted of the following (in thousands): March 27, December 31, 2016 2015 Amounts billed to the U.S. government in excess of approved rates $ 191 $ 191 Warranty liability 286 325 Customer deposits 353 342 Sales return reserve 125 490 Accrual legal and accounting 631 129 Other 710 742 $ 2,296 $ 2,219 Other long term liabilities consisted of the following (in thousands): March 27, December 31, 2016 2015 Long term deferred income tax $ 323 $ 318 Long term income taxes payable for unrecognized tax benefits 434 434 Other 154 160 Total other long term liabilities $ 911 $ 912 |
FAIR VALUE
FAIR VALUE | 3 Months Ended |
Mar. 27, 2016 | |
FAIR VALUE [Abstract] | |
FAIR VALUE | NOTE 3—FAIR VALUE The following table summarizes the Company’s financial assets and liabilities measured at fair value on a recurring basis as of March 27, 2016 and December 31, 2015 (in thousands): Fair Value Measurements Using Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) March 27, 2016: Assets: Cash equivalents: Money market funds $ 12,371 $ 12,371 $ - $ - $ 12,371 $ 12,371 $ - $ - Current liabilities: Liability warrants $ 30 $ - $ - $ 30 December 31, 2015: Assets: Cash equivalents: Money market funds $ 12,364 $ 12,364 $ - $ - $ 12,364 $ 12,364 $ - $ - Current liabilities: Liability warrants $ 39 $ - $ - $ 39 The Company’s financial assets and liabilities are valued using market prices on active markets (“Level 1”), less active markets (“Level 2”) and unobservable markets (“Level 3”). Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 instrument valuations are obtained from readily-available pricing sources for comparable instruments. Level 3 instruments are valued using unobservable market values in which there is little or no market data, and which require the Company to apply judgment to determine the fair value. For the three months ended March 27, 2016, the Company did not have any significant transfers between Level 1, Level 2 and Level 3. The amounts reported as cash and cash equivalents, accounts receivable, accounts payable, accrued compensation and other current liabilities approximate fair value due to their short-term maturities. The carrying value of the Company’s line of credit and capital lease obligations approximates fair value and is based upon borrowing rates currently available to the Company for loans and capital leases with similar terms. Liability Warrants The Company issued warrants to Bridge Bank in connection with a waiver of certain events of default that arose under a November 2009 loan and security agreement with Bridge Bank. Certain provisions in the warrant agreements provided for down-round protection if the Company raised equity capital at a per share price which was less than the per share price of the warrants. Such down-round protection also requires the Company to classify the value of the warrants as a liability on the issuance date and then record changes in the fair value through the consolidated statements of operations for each reporting period until the warrants are either exercised or cancelled. The fair value of the liability is recalculated and adjusted each quarter with the differences being charged to other income (expense), net on the consolidated statements of operations. The fair value of these warrants was determined using a Black-Scholes option-pricing model, which requires the use of significant unobservable market values. As a result, these warrants are classified as Level 3 financial instruments. On July 7, 2010, the Company raised additional equity through an offering of 2,760,000 shares at $1.75 per share, thus triggering the down-round protection and adjustment of the number of warrants issued to Bridge Bank. On December 24, 2013, the Company raised additional equity through an offering of 9,573,750 shares at $1.42 per share, thus triggering the down-round protection and adjustment of the number of warrants issued to Bridge Bank. On September 10, 2015, the Company raised additional equity through an offering of 10,643,000 shares at $1.70 per share, respectively, thus triggering the down-round protection and adjustment of the number of warrants issued to Bridge Bank. The fair value of the warrants was estimated using the following assumptions: As of March 27, 2016 As of December 31, 2015 Stock price $2.75 $3.04 Exercise price $2.31 $2.31 Expected life 1.31 years 1.55 years Risk-free interest rate 0.71% 0.86% Volatility 62% 62% Fair value per share $0.95 $1.23 The following table summarizes the warrants subject to liability accounting as of March 27, 2016 and December 31, 2015 (in thousands, except share and per share amounts) (see also Note 6): Three Months Ended March 27, 2016 Three Months Ended March 29, 2015 Holder Original Warrants Adjusted Warrants Grant Date Expiration Date Price per Share Fair Value March 27, 2016 Fair Value December 31, 2015 Exercise of Warrants Change in Fair Value Exercise of Warrants Change in Fair Value Related Agreement Bridge Bank 20,000 31,573 4/7/2010 7/7/2017 $ 2.31 $ 30 $ 39 - $ (9 ) - $ (1 ) Credit Agreement The change in the fair value of the Level 3 liability warrants during the three months ended March 27, 2016 is as follows (in thousands): Fair value as of December 31, 2015 $ 39 Exercise of warrants - Change in fair value (9 ) Fair value as of March 27, 2016 $ 30 The warrant liability is included in other current liabilities in the condensed consolidated balance sheets. |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 3 Months Ended |
Mar. 27, 2016 | |
INTANGIBLE ASSETS AND GOODWILL [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | NOTE 4—INTANGIBLE ASSETS AND GOODWILL Intangible assets consist of the following (in thousands): As of March 27, 2016 As of December 31, 2015 Life Gross Accumulated Amortization Net Gross Accumulated Amortization Net Definite-lived intangible assets: Customer relationships 6-8 $ 3,277 $ (2,647 ) $ 630 $ 3,277 $ (2,542 ) $ 735 Existing technology 6-7 6,527 (3,585 ) 2,942 6,527 (3,386 ) 3,141 Patents 5-16 457 (409 ) 48 457 (407 ) 50 Trade name 2-10 659 (452 ) 207 659 (438 ) 221 Total definite-lived intangible assets 10,920 (7,093 ) 3,827 10,920 (6,773 ) 4,147 Indefinite-lived Intangible assets: IPR&D indefinite 383 - 383 383 - 383 Total intangible assets $ 11,303 $ (7,093 ) $ 4,210 $ 11,303 $ (6,773 ) $ 4,530 For the three months ended March 27, 2016 and March 29, 2015, amortization of intangible assets was as follows (in thousands): Three Months Ended March 27, 2016 March 29, 2015 Cost of revenue $ 103 $ 103 Research and development expense 97 - Selling, general and administrative expense 120 120 $ 320 $ 223 Estimated future amortization expense related to intangible assets as of March 27, 2016 is as follows (in thousands): Years ending December 31, 2016 (remainder of the year) $ 937 2017 875 2018 451 2019 442 2020 394 Thereafter 728 Total $ 3,827 The Company performs a review of the carrying value of its intangible assets, if circumstances warrant. In its review, it compares the gross, undiscounted cash flows expected to be generated by the underlying assets against the carrying value of those assets. To the extent such cash flows do not exceed the carrying value of the underlying asset; it will record an impairment charge. The Company did not record an impairment charge on any intangibles, including goodwill, during the quarters ended March 27, 2016 and March 29, 2015. |
CREDIT FACILITIES
CREDIT FACILITIES | 3 Months Ended |
Mar. 27, 2016 | |
CREDIT FACILITIES [Abstract] | |
CREDIT FACILITIES | NOTE 5—CREDIT FACILITIES On March 25, 2013, the Company and its wholly owned subsidiaries, ChipX, Incorporated and Endwave Corporation (together with the Company, the “Prior Borrowers”) previously entered into a second amended and restated loan and security agreement (“Loan Agreement”) with Silicon Valley Bank (“SVB”) to replace the amended and restated loan and security agreement entered on December 9, 2011. On May 15, 2015, SVB and the Prior Borrowers entered into a Second Amendment to the Second Restated Loan Agreement, effective as of May 8, 2015 (the “Second Amendment”). Pursuant to the Second Amendment, the total aggregate amount that the Company is entitled to borrow from SVB under a Revolving Loan facility is $7 million, based on net eligible accounts receivable after an 80% advance rate and subject to limits based on the Company’s eligible accounts as determined by SVB. In addition, the Applicable Rate was decreased from Prime Rate plus 0.6% to Prime Rate plus 0.4%, and the default interest rate increase was decreased from 5% to 3%. The terms of the Second Amendment are set to expire on May 6, 2016. The Loan Agreement with SVB, as amended, is collateralized by all of the Company’s assets, including all accounts, equipment, inventory, receivables, and general intangibles. The Loan Agreement contains certain restrictive covenants that will impose significant operating and financial restrictions on its operations, including, but not limited to restrictions that limit its ability to: · Sell, lease, or otherwise transfer, or permit any of its subsidiaries to sell, lease or otherwise transfer, all or any part of its business or property, except in the ordinary course of business or in connection with certain indebtedness or investments permitted under the amended and restated loan agreement; · Merge or consolidate, or permit any of its subsidiaries to merge or consolidate, with or into any other business organization, or acquire, or permit any of its subsidiaries to acquire, all or substantially all of the capital stock or property of another person; · Create, incur, assume or be liable for any indebtedness, other than certain indebtedness permitted under the amended and restated loan and security agreement; · Pay any dividends or make any distribution or payment on, or redeem, retire, or repurchase, any capital stock; and · Make any investment, other than certain investments permitted under the amended and restated loan and security agreement. The Company had no outstanding balance on its line of credit as of March 27, 2016. |
STOCKHOLDERS' EQUITY AND STOCK-
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 27, 2016 | |
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION [Abstract] | |
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION | NOTE 6—STOCKHOLDERS’ EQUITY AND STOCK-BASED COMPENSATION Private Equity Placement On March 21, 2016, the Company entered into a Securities Purchase Agreement (the “PDSTI Agreement”) with Pudong Science and Technology Investment (Cayman) Co., Ltd., an affiliate of Shanghai Pudong Science and Technology Investment Co., Ltd. (collectively, “PDSTI”), pursuant to which PDSTI will purchase approximately $5 million of the Company’s common stock. Under the PDSTI Agreement, on March 24, 2016, the Company issued 1,754,385 shares of the Company’s common stock (the “Shares”) to PDSTI in a private placement at a purchase price of $2.85 per Share. Pursuant to the PDSTI Agreement, the Company has agreed to file a registration statement on Form S-3 to provide registration rights to PDSTI in respect of the Shares. To the extent that such registration statement has not been declared effective by the Securities and Exchange Commission on or before July 7, 2016, the Company will pay to PDSTI, as liquidated damages, 0.4% of the aggregate purchase price on a monthly, prorated basis, until the registration statement has been declared effective. Interest on these liquidated damages will accrue at the rate of 1.0% per month until paid in full. The Company has deemed this loss contingency to be remote and as such has not recorded a liability as of March 27, 2016. In the event that any U.S. governmental body or agency takes any action or issues any order within six months that would prevent PDSTI from holding the Shares or invalidates the Company’s issuance of the Shares to PDSTI, the Company has agreed to return PDSTI’s full purchase price, plus 0.4% interest on the purchase price (accruing monthly until paid in full), and to reimburse PDSTI’s expenses in connection with negotiating the private placement, up to $15,000. As a result of this contingent redemption clause, the net proceeds of $4.7 million are classified outside permanent equity until the contingency is resolved. Common and Preferred Stock In December 2008, the Company’s stockholders approved an amendment to the Certificate of Incorporation to authorize 50,000,000 shares of common stock of par value $0.001. In November 2014, the Company’s stockholders approved an amendment to the Amended and Restated Certificate of Incorporation to increase the number of authorized shares of common stock from 50,000,000 shares to 100,000,000 shares of par value $0.001. In addition, the Company is authorized to issue 1,000,000 shares of preferred stock of $0.001 par value of which 750,000 shares have been designated Series A Junior Preferred Stock with powers, preferences and rights as set forth in the amended and restated certificate of designation dated December 15, 2014; the remainder of the shares of preferred stock are undesignated, for which the Board of Directors is authorized to fix the designation, powers, preferences and rights. As of March 27, 2016 and December 31, 2015, there were no shares of preferred stock issued or outstanding. On December 16, 2014, the Company entered into an Amended and Restated Rights Agreement to extend the expiration date of its stockholder rights plan that may have the effect of deterring, delaying, or preventing a change in control. The Amended and Restated Rights Agreement amends the Rights Agreement previously adopted by (i) extending the expiration date by three years to December 16, 2017, (ii) decreasing the exercise price per right issued to stockholders pursuant to the stockholder rights plan from $8.50 to $5.25, and (iii) making certain other technical and conforming changes. The Amended and Restated Rights Agreement was not adopted in response to any acquisition proposal. Under the rights plan, the Company issued a dividend of one preferred share purchase right for each share of common stock held by stockholders of record as of January 6, 2012, and the Company will issue one preferred stock purchase right to each share of common stock issued between January 6, 2012 and the earlier of either the rights’ exercisability or the expiration of the Rights Agreement. Each right entitles stockholders to purchase one one-thousandth of the Company’s Series A Junior Preferred Stock. In general, the exercisability of the rights to purchase preferred stock will be triggered if any person or group, including persons knowingly acting in concert to affect the control of the Company, is or becomes a beneficial owner of 10% or more of the outstanding shares of the Company’s common stock after the Adoption Date. Stockholders or beneficial ownership groups who owned 10% or more of the outstanding shares of common stock of the Company on or before the Adoption Date will not trigger the preferred share purchase rights unless they acquire an additional 1% or more of the outstanding shares of the Company’s common stock. Each right entitles a holder with the right upon exercise to purchase one one-thousandth of a share of preferred stock at an exercise price that is currently set at $5.25 per right, subject to purchase price adjustments as set forth in the rights agreement. Each share of preferred stock has voting rights equal to one thousand shares of common stock. In the event that exercisability of the rights is triggered, each right held by an acquiring person or group would become void. As a result, upon triggering of exercisability of the rights, there would be significant dilution in the ownership interest of the acquiring person or group, making it difficult or unattractive for the acquiring person or group to pursue an acquisition of the Company. These rights expire in December of 2017, unless earlier redeemed or exchanged by the Company. 2008 Equity Incentive Plan In December 2008, the Company adopted the 2008 Equity Incentive Plan (the “2008 Plan”) for directors, employees, consultants and advisors to the Company or its affiliates. Under the 2008 Plan, 2,500,000 shares of common stock were reserved for issuance upon the completion of a merger with Lumera Corporation (“Lumera”) on December 9, 2008. On January 1 of each year, starting in 2009, the aggregate number of shares reserved for issuance under the 2008 Plan increase automatically by the lesser of (i) 5% of the number of shares of common stock outstanding as of the Company’s immediately preceding fiscal year, or (ii) a number of shares determined by the Board of Directors. The maximum number of shares of common stock to be granted is up to 21,000,000 shares. Forfeited options or awards generally become available for future awards. As of December 31, 2015, the stockholders had approved 18,280,238 shares for future issuance. As of March 27, 2016, 12,720,084 options to purchase common stock and restricted stock units (“RSUs”) were outstanding and 2,448,789 shares are authorized for future issuance under the 2008 equity incentive plan. Under the 2008 Plan, the exercise price of a stock option is at least 100% of the stock’s fair market value on the date of grant, and if an incentive stock option (“ISO”) is granted to a 10% stockholder at least 110% of the stock’s fair market value on the date of grant. Vesting periods for awards are recommended by the Chief Executive Officer and generally provide for stock options to vest over a four-year period, with a one year vesting cliff of 25%, and have a maximum life of ten years from the date of grant. The Company has also issued RSUs which generally vest over a three quarters to four year period. 2007 Equity Incentive Plan In August 2007, GigOptix LLC adopted the GigOptix LLC Equity Incentive Plan (the "2007 Plan"). The 2007 Plan provided for grants of options to purchase membership units, membership awards and restricted membership units to employees, officers and non-employee directors, and upon the completion of the merger with Lumera were converted into grants of up to 632,500 shares of stock. Vesting periods are determined by the Board of Directors and generally provide for stock options to vest over a four-year period and expire ten years from date of grant. Vesting for certain shares of restricted stock is contingent upon both service and performance criteria. The 2007 Plan was terminated upon the completion of merger with Lumera on December 9, 2008 and the remaining 864 stock in options not granted under the 2007 Plan were cancelled. No shares of the Company’s common stock remain available for issuance of new grants under the 2007 Plan other than for satisfying exercises of stock options granted under this plan prior to its termination. As of March 27, 2016, options to purchase a total of 375,663 shares of common stock and 4,125 warrants to purchase common stock were outstanding. Lumera 2000 and 2004 Stock Option Plan In December 2008, in connection with the merger with Lumera, the Company assumed the existing Lumera 2000 Equity Incentive Plan and the Lumera 2004 Stock Option Plan (the “Lumera Plan”). All unvested options granted under the Lumera Plan were assumed by the Company as part of the merger. All contractual terms of the assumed options remain the same, except for the converted number of shares and exercise price based on merger conversion ratio of 0.125. As of March 27, 2016, no additional options can be granted under the Lumera Plan, and options to purchase a total of 57,191 shares of common stock were outstanding. Warrants As of March 27, 2016, the Company had a total of 160,698 warrants to purchase common stock outstanding under all warrant arrangements. During the three months ended March 27, 2016, no warrants were exercised or expired. Some of the warrants have anti-dilution provisions which adjust the number of warrants available to the holder such as, but not limited to, stock dividends, stock splits and certain reclassifications, exchanges, combinations or substitutions. These provisions are specific to each warrant agreement. Stock-based Compensation Expense The following table summarizes the Company’s stock-based compensation expense for the three months ended March 27, 2016 and March 29, 2015 (in thousands): Three Months Ended March 27, 2016 March 29, 2015 Cost of revenue $ 86 $ 82 Research and development expense 323 247 Selling, general and administrative expense 876 560 $ 1,285 $ 889 The Company did not grant any options during the three months ended March 27, 2016 and March 29, 2015. During the three months ended March 27, 2016, the Company granted 1,333,623 RSUs with a grant-date fair value of $4.0 million or $2.97 per share. During the three months ended March 29, 2015, the Company granted 2,815,822 RSUs with a grant-date fair value of $3.5 million or $1.25 per share. As of March 27, 2016, the total compensation cost not yet recognized in connection with unvested stock options and RSUs under the Company’s equity compensation plans was approximately $76,000 and $8.9 million, respectively. Unrecognized compensation will be amortized on a straight-line basis over a weighted-average period of approximately 0.95 years for stock options and approximately 2.85 years for RSUs. Stock Option and RSU Activity The following is a summary of option activity for the Company’s equity incentive plans, including both the 2008 Plan and other prior plans for which there are outstanding options but no new grants since the 2008 Plan was adopted: Options Weighted- Average Exercise Price Weighted-Average Remaining Contractual Term, in Years Outstanding, December 31, 2015 7,918,584 $ 2.32 4.82 Granted - Exercised (132,493 ) $ 2.10 Forfeited/Expired (3,347 ) $ 2.49 Ending balance, March 27, 2016 7,782,744 $ 2.32 4.54 Vested and exercisable and expected to vest, March 27, 2016 7,774,286 $ 2.33 4.54 Vested and exercisable, March 27, 2016 7,657,473 $ 2.35 4.50 The aggregate intrinsic value of options vested, exercisable and expected to vest, based on the fair value of the underlying stock options as of March 27, 2016 was approximately $5.1 million. The aggregate intrinsic value reflects the difference between the exercise price of the underlying stock options and the Company’s closing share price of $2.75 as of March 24, 2016. The total intrinsic value of options exercised during the three months ended March 27, 2016 was $132,000. The total intrinsic value of options exercised during the three months ended March 29, 2015 was $8,000. RSUs are converted into shares of the Company’s common stock upon vesting on a one-for-one basis. Typically, vesting of RSUs is subject to the employee’s continuing service to the Company. RSUs generally vest over a period of one to four years and are expensed ratably on a straight line basis over their respective vesting period net of estimated forfeitures. The fair value of the RSUs granted is the product of the number of shares granted and the grant date fair value of the Company’s common stock. The following is a summary of RSU activity for the indicated periods: Number of Shares Weighted- Average Grant Date Fair Value Weighted- Average Remaining Vesting Term, Years Aggregate Intrinsic Value (In thousands) Outstanding, December 31, 2015 4,361,833 $ 1.64 2.86 $ 13,260 Granted 1,333,623 2.97 Released (296,720 ) 2.16 Forfeited/expired (28,542 ) 1.84 Outstanding, March 27, 2016 5,370,194 $ 1.94 2.85 $ 14,768 The majority of the RSUs that vested in the three months ended March 27, 2016 were net-share settled such that the Company withheld shares with value equivalent to the employees’ minimum statutory obligation for the applicable income and other employment taxes, and remitted the cash to the appropriate taxing authorities. The total shares withheld were based on the value of the RSUs on their vesting date as determined by the Company’s closing stock price. These net-share settlements had the effect of share repurchases by the Company as they reduced and retired the number of shares that would have otherwise been issued as a result of the vesting and did not represent an expense to the Company. For the three months ended March 27, 2016, 296,720 shares of RSUs vested with an intrinsic value of approximately $988,000. The Company withheld 117,221 shares to satisfy approximately $395,000 of employees’ minimum tax obligation on the vested RSUs. |
INVESTMENT IN UNCONSOLIDATED AF
INVESTMENT IN UNCONSOLIDATED AFFILIATES | 3 Months Ended |
Mar. 27, 2016 | |
INVESTMENT IN UNCONSOLIDATED AFFILIATES [Abstract] | |
INVESTMENT IN UNCONSOLIDATED AFFILIATES | NOTE 7— In February 2014, together with CPqD, the Company incepted a new joint venture, named BrP, of which the Company owns 49% and CPqD owns 51% of BrP. It is based in Campinas, Brazil. BrP will be a provider of advanced high-speed devices for optical communications and integrated transceiver components for information networks. It is engaged in research and development of SiPh advanced electro-optical products. The Company transferred into BrP its knowledge-base and intellectual property of TM technology. The Company transferred its inventory related to the TM platform and the complete production line equipment that previously resided at its Bothell, Washington, facility to CPqD, for use on the BrP joint venture. As of the transfer date, the Company’s net book value of the inventory and property and equipment was $245,000 and $211,000, respectively. During the second quarter of 2015, the Company made an additional capital contribution of $3,000 pursuant to BrP’s Amended Articles of Association which resulted in a $459,000 investment in BrP. For the years ended December 31, 2015 and 2014, the Company had losses of $3,000 and $456,000, respectively, for the Company’s allocated portion of BrP’s results. Since the Company’s share of the loss exceeded the Company’s carrying cost of its investment in BrP, the Company’s investment in an unconsolidated affiliate was written down to zero as of December 31, 2015. On January 25, 2016, the Company invested $1.2 million to own a minority stake in a company called Anagog Ltd. (“Anagog”), the developer of the world’s largest crowdsourced parking network. Anagog perfects the mobility status algorithms that allow for advanced on-phone machine learning capabilities for the best user experience with ultra-low battery consumption and a high level of privacy protection. As of March 27, 2016, this cost method investment of $1.2 million is recorded in other assets on the condensed consolidated balance sheet. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 27, 2016 | |
INCOME TAXES [Abstract] | |
INCOME TAXES | NOTE 8—INCOME TAXES The Company recorded a provision for income taxes of $40,000 for the three months ended March 27, 2016, and $9,000 for the three months ended March 29, 2015. The income tax provision for the three months ended March 27, 2016 and March 29, 2015 In assessing the potential realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. In making such a determination, management considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial performance. In order to support a conclusion that a valuation allowance is not needed, positive evidence of sufficient quantity and quality is necessary to overcome negative evidence. The ultimate realization of deferred tax assets is dependent on the generation of future taxable income during the periods in which those temporary differences become deductible. A valuation allowance has been recorded for the entire deferred tax asset as a result of uncertainties regarding realization of the asset including lack of profitability through March 27, 2016 and the uncertainty over future operating profitability and taxable income. The Company will continue to evaluate the potential realization of the deferred tax assets on a quarterly basis. The Company files tax returns in the U.S. federal, U.S. state and foreign tax jurisdictions. The Company’s major tax jurisdictions are the U.S., California, Switzerland, Korea, Japan, and Israel. With the acquisition of Magnum on April 5, 2016, the Company has added in the second fiscal quarter of 2016, Ontario, Canada to this list. The Company’s fiscal years through December 31, 2015 remain subject to examination by the tax authorities for U.S. federal, U.S. state and foreign tax purpose. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 3 Months Ended |
Mar. 27, 2016 | |
NET LOSS PER SHARE [Abstract] | |
NET LOSS PER SHARE | NOTE 9—NET LOSS PER SHARE The following table summarizes total securities outstanding which were not included in the calculation of diluted net loss per share because to do so would have been anti-dilutive: March 27, March 29, 2016 2015 Stock options and RSUs 13,152,938 12,724,280 Common stock warrants 160,698 658,240 Total 13,313,636 13,382,520 |
SEGMENT AND GEOGRAPHIC INFORMAT
SEGMENT AND GEOGRAPHIC INFORMATION | 3 Months Ended |
Mar. 27, 2016 | |
SEGMENT AND GEOGRAPHIC INFORMATION [Abstract] | |
SEGMENT AND GEOGRAPHIC INFORMATION | NOTE 10—SEGMENT AND GEOGRAPHIC INFORMATION The Company has determined that it operates as a single operating and reportable segment. The following tables reflect the results of the Company’s reportable segment consistent with the management system used by the Company’s Chief Executive Officer, the chief operating decision maker. The following table summarizes revenue by geographic region (in thousands): Three Months Ended March 27, 2016 March 29, 2015 North America $ 4,728 42 % $ 3,031 33 % Asia 3,841 34 % 2,819 31 % Europe 2,793 24 % 2,953 33 % Other - 0 % 257 3 % $ 11,362 100 % $ 9,060 100 % The Company determines geographic location of its revenue based upon the destination of shipments of its products. For the three months ended March 27, 2016, three customers, of which two are distributors that serve large number of customers in their geographical regions, accounted for 49% of total revenue. For the three months ended March 29, 2015, three customers accounted for 51% of total revenue. No other customers accounted for more than 10% of total revenue during the periods presented. During three months ended March 27, 2016, the United States, Europe and the Far East accounted for 41%, 22% and 32% of revenue, respectively. During three months ended March 29, 2015, the United States, Europe and the Far East accounted for 27%, 29% and 25% of revenue, respectively. No other countries accounted for more than 10% of the Company’s consolidated revenue during the periods presented. The following table summarizes long-lived assets by country (in thousands): March 27, 2016 December 31, 2015 United States $ 2,471 85 % $ 2,680 85 % Switzerland 432 15 % 435 14 % Asia 16 0 % 18 1 % $ 2,919 100 % $ 3,133 100 % Long-lived assets, comprised of property and equipment, are reported based on the location of the assets at each balance sheet date. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 27, 2016 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 11—COMMITMENTS AND CONTINGENCIES Commitments Leases The Company leases its domestic and foreign sales offices under non-cancelable operating leases. These leases contain various expiration dates and renewal options. The Company also leases certain software licenses under operating leases. Total facilities rent expense for the three months ended March 27, 2016 was $142,000, and for the three months ended March 29, 2015 was $111,000. Aggregate non-cancelable future minimum rental payments under capital and operating leases are as follows (in thousands): Capital Leases Operating Leases Years ending December 31, Minimum lease payments Minimum lease payments 2016 (remainder of the year) $ 2 $ 498 2017 3 227 2018 - 73 2019 - 73 2020 and beyond - 61 Total minimum lease payments 5 $ 932 Less: Amount representing interest - Total capital lease obligations 5 Less: current portion (3 ) Long-term portion of capital lease obligations $ 2 Contingencies Tax Contingencies The Company’s income tax calculations are based on application of the respective U.S. Federal, state or foreign tax law. Its tax filings, however, are subject to audit by the respective tax authorities. Accordingly, the Company recognizes tax liabilities based upon its estimate of whether, and the extent to which, additional taxes will be due. Legal Contingencies From time to time, the Company may become involved in legal proceedings, claims and litigation arising in the ordinary course of business. When it believes a loss is probable and can be reasonably estimated, it accrues the estimated loss in its consolidated financial statements. Where the outcome of these matters is not determinable, it does not make a provision in its financial statements until the loss, if any, is probable and can be reasonable estimated or the outcome becomes known. Product Warranties The Company’s products typically carry a standard warranty period of approximately one year. The Company records a liability based on estimates of the costs that may be incurred under its warranty obligations and charges to the cost of product revenue the amount of such costs at the time revenues are recognized. The warranty obligation is affected by product failure rates, material usage and service delivery costs incurred in correcting a product failure. The estimates of anticipated rates of warranty claims and costs per claim are primarily based on historical information and future forecasts. The table below summarizes the movement in the warranty accrual, which is included as a component of other current liabilities, for the three months ended March 27, 2016 and March 29, 2015 (in thousands): Three months ended March 27, 2016 March 29, 2015 Beginning balance $ 325 $ 334 Warranties accrued 8 197 Warranties settled (47 ) (162 ) Ending balance $ 286 $ 369 |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 27, 2016 | |
RECENT ACCOUNTING PRONOUNCEMENTS [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | NOTE 12—RECENT ACCOUNTING PRONOUNCEMENTS In February 2016, We are evaluating the impact the adoption will have on our condensed consolidated financial statements . In March 2016, We do not expect the adoption will have a material impact on our condensed consolidated financial statements . In March 2016, We do not expect the adoption will have a material impact on our condensed consolidated financial statements . |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 27, 2016 | |
SUBSEQUENT EVENTS [Abstract] | |
SUBSEQUENT EVENTS | NOTE 13—SUBSEQUENT EVENTS On April 5, 2016, the Company completed an acquisition of Magnum pursuant to the terms of the Agreement and Plan of Merger, dated as of April 1 2016 (the “Merger Agreement”). The acquisition was executed via a combination of equity and cash, issuing approximately 6.9 million shares and paying an additional approximately $36.2 million in net cash, of which a significant portion was used to repay Magnum’s outstanding debt and other liabilities. The Company borrowed a combined total of $22.1 million from SVB. Upon completion of the merger, the outstanding shares of, and certain warrants to acquire, Magnum’s senior preferred stock, as well as notes held by the holders of such shares of Magnum senior preferred stock, were converted either into the right to receive shares of GigPeak common stock or cash depending upon whether the holder of such shares of preferred stock or warrants were “accredited investors” as such term is defined in Rule 501 of Regulation D of the Securities Act of 1933, as amended. All other shares of, and options and warrants to acquire, Magnum common and preferred stock were cancelled, extinguished and terminated without conversion upon the consummation of the Merger. On April 5, 2016, SVB and the Prior Borrowers, with newly acquired Magnum, entered into the Third Amended and Restated Loan and Security Agreement (the “Third Restated Loan Agreement”) which amended and restated the Second Amendment. Pursuant to the Third Restated Loan Agreement, the total aggregate amount that the Company is entitled to borrow from SVB has increased to $29 million, which is split into two different credit facilities, comprised of (i) the existing Revolving Loan facility which was amended to provide that the Company is entitled to borrow from SVB up to $14 million, based on net eligible accounts receivable after an 80% advance rate and subject to limits based on the Company’s eligible accounts as determined by SVB (the “Amended Revolving Loan”) and (ii) a second facility under which the Company is entitled to borrow from SVB up to $15 million without reference to accounts receivable, and which must be repaid in sixty equal installments, unless it exercise its right to prepay the loan under the conditions of, and subject to the limitations to, the Third Restated Loan Agreement. The interest rate is Prime Rate plus 1.25%, and the default interest rate remains at 3%. Also, SVB had two outstanding existing warrants to purchase common stock of the Company: (i) warrants for 4,125 shares of common stock at an exercise price of $0.73, with an expiration date of 10/5/2017, and (ii) warrants for 125,000 shares of common stock at an exercise price of $4.00 per share, with an expiration date of 4/23/2017. In connection with the Third Restated Loan Agreement, the warrants have been amended and restated to extend the expiration date of those warrants to 10/5/2022 and 4/23/2022, respectively. |
ORGANIZATION AND BASIS OF PRE20
ORGANIZATION AND BASIS OF PRESENTATION (Policies) | 3 Months Ended |
Mar. 27, 2016 | |
ORGANIZATION AND BASIS OF PRESENTATION [Abstract] | |
Organization | Organization GigPeak Inc. (formerly GigOptix, Inc.) (“GigPeak” or the “Company”) is a leading innovator of semiconductor integrated circuits (“ICs”) and software solutions for high-speed connectivity and high-quality video compression over the network and the Cloud. The Company’s focus is to develop and deliver products that enable lower power consumption and faster data connectivity, more efficient use of network infrastructure and broader connectivity to the Cloud, and reduce the total cost of ownership of existing network pipes from the core to the end user. GigPeak addresses both the speed of data transmission and the amount of bandwidth the data consumes within the network, and provides solutions that increase the efficiency of various cloud-connected applications, such as the Internet-of-Things (“IoT”), leveraging its strength in high-speed connectivity and, with the highest quality video compression assets that were acquired through the acquisition (the “Merger”) of Magnum Semiconductor, Inc. (“Magnum”) during the Company’s second fiscal quarter on April 5, 2016. The extended product portfolio provides more flexibility to support changing market requirements and customer’s dynamic road-maps, by way of using ICs and monolithic microwave integrated circuits (“MMICs”), and through full software programmability and cost efficient custom application specific integrated circuit (“ASICs”). The Company develops semiconductor ICs and software solutions for high-speed connectivity and high-quality video compression over the enterprise network and the Cloud. With its product focus, the Company attempts to reduce the total cost of ownership of existing network pipes, from the core of the network to the end user appliances and terminals. GigPeak addresses both the speed of data transmission and the amount of bandwidth the data consumes within the network, which are the two major data streaming bottlenecks, while also the future enabler factors, to maintain network efficiency. As such, the Company’s products also naturally provide solutions that increase the efficiency of IoT and other Cloud-connected applications. GigPeak’s solutions leverage its industry-recognized strength in high-speed connectivity delivered through the GigOptix brand-name product line, and as of the second fiscal quarter of 2016, the highest quality video compression delivered through the industry-recognized Magnum brand. The recently extended GigPeak product portfolio provides flexibility to better support on-going changes in the connectivity that customers and markets require by deploying a wide tool-box of solutions from various kinds of semiconductor materials, integrated circuits and Multi-Chip-Modules (“MCMs), through cost-effective ASICs and (“SoCs”), and into full software programmable open-platform offerings. The Company’s products are highly customized and typically developed in partnership with key “Lighthouse” customers, occasionally generating some engineering project revenues through the development stage, and where the largest revenue is generated from future device product shipments and sales through these customers and general market availability. Since inception in 2007, the Company has expanded its customer base by acquiring and integrating eight (8) companies with complementary and synergistic products and customers, and spun out one (1) business to establish a joint-venture. GigPeak’s worldwide direct sales force is supported by a significant number of channel representatives and distributors that sell its products throughout North America, South America, Europe, Japan and Asia. As noted above, on April 5, 2016, the Company completed its most recent acquisition of Magnum, and simultaneously renamed itself as GigPeak, Inc. Magnum is a fabless semiconductor manufacturer and software solution developer, and brings a well-developed and comprehensive portfolio of video broadcasting and compression solutions to GigPeak, including silicon ICs, SoCs, software solutions, and a comprehensive library of intellectual property. The Magnum products currently are for the professional video broadcast and are extendable to IoT camera markets. Magnum provides top of the line products, tools and technologies for the entire video content creation and distribution chain, from contribution and production through distribution over cable, telecom, satellite and over-the-top (“OTT”) video streaming. Through the acquisition of Magnum, the Company broadens its product offerings by adding additional flavors of silicon integrated circuits (“ICs”), and new SoCs, software, and intellectual property (“IP”) for the professional broadcast infrastructure market. Today’s video service providers, which include cable operators, telecommunications companies and satellite TV providers, are continuously seeking to perfect their linear and nonlinear workflows and improve the quality of their video content, while simultaneously optimizing the efficiency of their networks. The Company’s products, tools, and technologies are currently used in the entire video content creation and distribution chain. Specifically, GigPeak’s solutions are used to address challenges in video contribution, video production, primary and secondary distribution, and enterprise wide solutions. Over time, GigPeak will look to leverage those capabilities and seek opportunities to expand its offerings into new markets, such as potentially surveillance cameras and other video IoT applications. The blending of products and technologies gives GigPeak the capability to address both the speed of data transmission and the amount of bandwidth the data consumes within a network, driven in particular by the video content which is the source of a majority of the datacenter traffic and storage on today’s networks. Through this combination, the Company provides solutions to enhance the footprint utilization and reduce total cost of ownership of existing network pipes from the core to the end user. Its wide product portfolio and exceptional customer support practices, will continue to serve the enterprise networking and broadcasting original equipment manufacturers (“OEMs”), as well as IoT and other Cloud-connected consumers. With the acquisition of Magnum, the Company is in the process of reorganizing its operations to line up with its targeted end-markets and customers. This will eventually result later in fiscal 2016 in two business lines: the Enterprise Networking, which will be likely named the “GigOptix” product line, and the Consumer and Cloud-Connectivity, which will be likely named the “GigCloud” line. Most of the Company’s current product lines will contribute products to each one of those two business lines. |
Basis of Presentation | Basis of Presentation The Company’s fiscal year ends on December 31. For quarterly reporting, the Company employs a five-week, four-week, four-week, reporting period. The first quarter of 2016 ended on Sunday, March 27, 2016. The first quarter of 2015 ended on Sunday, March 29, 2015. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements as of March 27, 2016 and for the three months ended March 27, 2016 and March 29, 2015, have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Article 10 of Securities and Exchange Commission (“SEC”) Regulation S-X. The statements include the accounts of the Company and all of its subsidiaries and they do not include all of the information and footnotes required by such accounting principles for annual financial statements. In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company’s financial position as of March 27, 2016, and the results of operations and cash flows for the three months ended March 27, 2016 and March 29, 2015. The condensed consolidated results of operations for the three months ended March 27, 2016 are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year ending December 31, 2016. 2015 Form 10-K. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reported periods. These judgments can be subjective and complex, and consequently, actual results could differ materially from those estimates and assumptions. Descriptions of these estimates and assumptions are included in the 2015 Form 10-K and the Company encourages you to read its 2015 Form 10-K for more information about such estimates and assumptions. Reclassifications Certain prior fiscal year balances have been reclassified to conform to the current fiscal year presentation. In the fourth quarter of 2015 the Company concluded that it was appropriate to classify certain accruals of trade payable items as accounts payable instead of other accrued liabilities. The reclassification has no effect on previously reported consolidated statements of operations or accumulated deficit for any period and does not affect previously reported cash flows from operating, investing or financing activities in the consolidated statements of cash flows. For comparability purposes, $446,000 of other current liabilities was reclassified to accounts payable as of March 29, 2015. |
Reclassifications | Reclassifications Certain prior fiscal year balances have been reclassified to conform to the current fiscal year presentation. In the fourth quarter of 2015 the Company concluded that it was appropriate to classify certain accruals of trade payable items as accounts payable instead of other accrued liabilities. The reclassification has no effect on previously reported consolidated statements of operations or accumulated deficit for any period and does not affect previously reported cash flows from operating, investing or financing activities in the consolidated statements of cash flows. For comparability purposes, $446,000 of other current liabilities was reclassified to accounts payable as of March 29, 2015. |
Revenue Recognition | Revenue Recognition Revenue from sales of optical drivers and receivers, multi-chip modulators, and other products is recognized when persuasive evidence of a sales arrangement exists, transfer of title occurs, the sales price is fixed or determinable and collection of the resulting receivable is reasonably assured. Reserves are made for warranties at the time revenue is recorded. See Note 11—Commitments and Contingencies for further detail related to the warranty reserve. Customer purchase orders are generally used to determine the existence of an arrangement. Transfer of title and risk of ownership occur based on defined terms in customer purchase orders, and generally pass to the customer upon shipment, at which point goods are delivered to a carrier. There are no formal customer acceptance terms or further obligations, outside of standard product warranty. The Company assesses whether the sales price is fixed or determinable based on the payment terms associated with the transaction. Collectability is assessed based primarily on the credit worthiness of the customer as determined through ongoing credit evaluations of the customer’s financial condition, as well as, consideration of the customer’s payment history. The Company records revenue from non-recurring engineering projects associated with product development that the Company enters into with certain customers. In general, these projects are associated with complex technology development, and as such the Company does not have certainty about its ability to achieve the program milestones. Achievement of the milestone is dependent on the Company’s performance and is typically accepted by the customer. The payment associated with achieving the milestone is generally commensurate with the Company’s effort or the value of the deliverable and is nonrefundable. Therefore, the Company records the expenses related to these projects in the periods incurred and recognizes revenue only when the Company has earned the revenue and achieved the development milestones. Revenue from these projects is typically recorded at 100% gross margin because the costs associated with these projects are expensed as incurred and generally included in research and development expense. These efforts generally benefit the Company’s overall product development programs beyond the specific project requested by our customer. The Company sells some products to distributors at the price listed in its price book for that distributor. Certain of the Company's distributor agreements provide for semi-annual stock rotation privileges of 5% to 10% of net sales for the previous six-month period. At the time of sale, the Company records a sales reserve for stock rotations approved by management. The Company offsets the sales reserve against revenues, producing the net revenue amount reported in the consolidated statements of operations. Each month the Company adjusts the sales reserve for the estimated stock rotation privilege anticipated to be utilized by the distributors. When the distributors pay the Company's invoices, they may claim stock rotations when appropriate. Once claimed, the Company processes the requests against the prior authorizations and reduces the reserve previously established for that customer. As of March 27, 2016 and December 31, 2015, the reserve for stock rotations was $125,000 and $490,000, respectively, and is recorded in other current liabilities on the consolidated balance sheets. The Company records transaction-based taxes including, but not limited to, sales, use, value added, and excise taxes, on a net basis in its consolidated statements of operations. |
BALANCE SHEET COMPONENTS (Table
BALANCE SHEET COMPONENTS (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
BALANCE SHEET COMPONENTS [Abstract] | |
Accounts receivable, net | Accounts receivable, net consisted of the following (in thousands): March 27, December 31, 2016 2015 Accounts receivable $ 9,094 $ 10,659 Allowance for doubtful accounts (55 ) (63 ) $ 9,039 $ 10,596 |
Property and equipment, net | Property and equipment, net consisted of the following (in thousands, except depreciable life): Life March 27, December 31, (In years) 2016 2015 Network and laboratory equipment 3 – 5 $ 13,660 $ 13,520 Computer software and equipment 2 – 3 4,227 4,207 Furniture and fixtures 3 – 7 165 165 Office equipment 3 – 5 143 142 Leasehold improvements 1 – 5 336 316 18,531 18,350 Accumulated depreciation and amortization (15,612 ) (15,217 ) Property and equipment, net $ 2,919 $ 3,133 |
Inventories | Inventories consisted of the following (in thousands): March 27, December 31, 2016 2015 Raw materials $ 2,126 $ 2,379 Work in process 3,603 2,710 Finished goods 1,242 1,791 $ 6,971 $ 6,880 |
Other current liabilities | Accrued and other current liabilities consisted of the following (in thousands): March 27, December 31, 2016 2015 Amounts billed to the U.S. government in excess of approved rates $ 191 $ 191 Warranty liability 286 325 Customer deposits 353 342 Sales return reserve 125 490 Accrual legal and accounting 631 129 Other 710 742 $ 2,296 $ 2,219 |
Other long-term liabilities | Other long term liabilities consisted of the following (in thousands): March 27, December 31, 2016 2015 Long term deferred income tax $ 323 $ 318 Long term income taxes payable for unrecognized tax benefits 434 434 Other 154 160 Total other long term liabilities $ 911 $ 912 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
FAIR VALUE [Abstract] | |
Financial assets and liabilities measured at fair value, recurring basis | The following table summarizes the Company’s financial assets and liabilities measured at fair value on a recurring basis as of March 27, 2016 and December 31, 2015 (in thousands): Fair Value Measurements Using Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) March 27, 2016: Assets: Cash equivalents: Money market funds $ 12,371 $ 12,371 $ - $ - $ 12,371 $ 12,371 $ - $ - Current liabilities: Liability warrants $ 30 $ - $ - $ 30 December 31, 2015: Assets: Cash equivalents: Money market funds $ 12,364 $ 12,364 $ - $ - $ 12,364 $ 12,364 $ - $ - Current liabilities: Liability warrants $ 39 $ - $ - $ 39 |
Estimate of fair value for warrants assumptions | The fair value of the warrants was estimated using the following assumptions: As of March 27, 2016 As of December 31, 2015 Stock price $2.75 $3.04 Exercise price $2.31 $2.31 Expected life 1.31 years 1.55 years Risk-free interest rate 0.71% 0.86% Volatility 62% 62% Fair value per share $0.95 $1.23 |
Warrants subject to liability accounting | The following table summarizes the warrants subject to liability accounting as of March 27, 2016 and December 31, 2015 (in thousands, except share and per share amounts) (see also Note 6): Three Months Ended March 27, 2016 Three Months Ended March 29, 2015 Holder Original Warrants Adjusted Warrants Grant Date Expiration Date Price per Share Fair Value March 27, 2016 Fair Value December 31, 2015 Exercise of Warrants Change in Fair Value Exercise of Warrants Change in Fair Value Related Agreement Bridge Bank 20,000 31,573 4/7/2010 7/7/2017 $ 2.31 $ 30 $ 39 - $ (9 ) - $ (1 ) Credit Agreement |
Change in the fair value of level 3 liabilities | The change in the fair value of the Level 3 liability warrants during the three months ended March 27, 2016 is as follows (in thousands): Fair value as of December 31, 2015 $ 39 Exercise of warrants - Change in fair value (9 ) Fair value as of March 27, 2016 $ 30 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
INTANGIBLE ASSETS AND GOODWILL [Abstract] | |
Intangible assets | Intangible assets consist of the following (in thousands): As of March 27, 2016 As of December 31, 2015 Life Gross Accumulated Amortization Net Gross Accumulated Amortization Net Definite-lived intangible assets: Customer relationships 6-8 $ 3,277 $ (2,647 ) $ 630 $ 3,277 $ (2,542 ) $ 735 Existing technology 6-7 6,527 (3,585 ) 2,942 6,527 (3,386 ) 3,141 Patents 5-16 457 (409 ) 48 457 (407 ) 50 Trade name 2-10 659 (452 ) 207 659 (438 ) 221 Total definite-lived intangible assets 10,920 (7,093 ) 3,827 10,920 (6,773 ) 4,147 Indefinite-lived Intangible assets: IPR&D indefinite 383 - 383 383 - 383 Total intangible assets $ 11,303 $ (7,093 ) $ 4,210 $ 11,303 $ (6,773 ) $ 4,530 |
Amortization of intangible assets | For the three months ended March 27, 2016 and March 29, 2015, amortization of intangible assets was as follows (in thousands): Three Months Ended March 27, 2016 March 29, 2015 Cost of revenue $ 103 $ 103 Research and development expense 97 - Selling, general and administrative expense 120 120 $ 320 $ 223 |
Estimated future amortization expense | Estimated future amortization expense related to intangible assets as of March 27, 2016 is as follows (in thousands): Years ending December 31, 2016 (remainder of the year) $ 937 2017 875 2018 451 2019 442 2020 394 Thereafter 728 Total $ 3,827 |
STOCKHOLDERS' EQUITY AND STOC24
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION [Abstract] | |
Schedule of stock-based compensation expense | The following table summarizes the Company’s stock-based compensation expense for the three months ended March 27, 2016 and March 29, 2015 (in thousands): Three Months Ended March 27, 2016 March 29, 2015 Cost of revenue $ 86 $ 82 Research and development expense 323 247 Selling, general and administrative expense 876 560 $ 1,285 $ 889 |
Summary of option activity | The following is a summary of option activity for the Company’s equity incentive plans, including both the 2008 Plan and other prior plans for which there are outstanding options but no new grants since the 2008 Plan was adopted: Options Weighted- Average Exercise Price Weighted-Average Remaining Contractual Term, in Years Outstanding, December 31, 2015 7,918,584 $ 2.32 4.82 Granted - Exercised (132,493 ) $ 2.10 Forfeited/Expired (3,347 ) $ 2.49 Ending balance, March 27, 2016 7,782,744 $ 2.32 4.54 Vested and exercisable and expected to vest, March 27, 2016 7,774,286 $ 2.33 4.54 Vested and exercisable, March 27, 2016 7,657,473 $ 2.35 4.50 |
Summary of RSU activity | The following is a summary of RSU activity for the indicated periods: Number of Shares Weighted- Average Grant Date Fair Value Weighted- Average Remaining Vesting Term, Years Aggregate Intrinsic Value (In thousands) Outstanding, December 31, 2015 4,361,833 $ 1.64 2.86 $ 13,260 Granted 1,333,623 2.97 Released (296,720 ) 2.16 Forfeited/expired (28,542 ) 1.84 Outstanding, March 27, 2016 5,370,194 $ 1.94 2.85 $ 14,768 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
NET LOSS PER SHARE [Abstract] | |
Antidilutive securities excluded from computation of earnings per share | The following table summarizes total securities outstanding which were not included in the calculation of diluted net loss per share because to do so would have been anti-dilutive: March 27, March 29, 2016 2015 Stock options and RSUs 13,152,938 12,724,280 Common stock warrants 160,698 658,240 Total 13,313,636 13,382,520 |
SEGMENT AND GEOGRAPHIC INFORM26
SEGMENT AND GEOGRAPHIC INFORMATION (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
SEGMENT AND GEOGRAPHIC INFORMATION [Abstract] | |
Revenue by geographic region | The following table summarizes revenue by geographic region (in thousands): Three Months Ended March 27, 2016 March 29, 2015 North America $ 4,728 42 % $ 3,031 33 % Asia 3,841 34 % 2,819 31 % Europe 2,793 24 % 2,953 33 % Other - 0 % 257 3 % $ 11,362 100 % $ 9,060 100 % |
Long lived assets by country | The following table summarizes long-lived assets by country (in thousands): March 27, 2016 December 31, 2015 United States $ 2,471 85 % $ 2,680 85 % Switzerland 432 15 % 435 14 % Asia 16 0 % 18 1 % $ 2,919 100 % $ 3,133 100 % |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Mar. 27, 2016 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
Aggregate non-cancelable future minimum rental payments | Aggregate non-cancelable future minimum rental payments under capital and operating leases are as follows (in thousands): Capital Leases Operating Leases Years ending December 31, Minimum lease payments Minimum lease payments 2016 (remainder of the year) $ 2 $ 498 2017 3 227 2018 - 73 2019 - 73 2020 and beyond - 61 Total minimum lease payments 5 $ 932 Less: Amount representing interest - Total capital lease obligations 5 Less: current portion (3 ) Long-term portion of capital lease obligations $ 2 |
Summary of changes in warranty accrual | The table below summarizes the movement in the warranty accrual, which is included as a component of other current liabilities, for the three months ended March 27, 2016 and March 29, 2015 (in thousands): Three months ended March 27, 2016 March 29, 2015 Beginning balance $ 325 $ 334 Warranties accrued 8 197 Warranties settled (47 ) (162 ) Ending balance $ 286 $ 369 |
ORGANIZATION AND BASIS OF PRE28
ORGANIZATION AND BASIS OF PRESENTATION (Details) | 3 Months Ended | ||
Mar. 27, 2016USD ($)BusinessLine | Dec. 31, 2015USD ($) | Mar. 29, 2015USD ($) | |
Organization [Abstract] | |||
Number of business lines | BusinessLine | 2 | ||
Revenue Recognition [Line Items] | |||
Percentage of gross margin at which revenue from development projects are recorded | 100.00% | ||
Period of stock rotation | 6 months | ||
Reserve for stock rotations | $ 125,000 | $ 490,000 | |
Rclasification [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Current liabilities reclassified to accounts payable | $ 446,000 | ||
Minimum [Member] | |||
Revenue Recognition [Line Items] | |||
Stock rotation privileges specified as percentage of net sales | 5.00% | ||
Maximum [Member] | |||
Revenue Recognition [Line Items] | |||
Stock rotation privileges specified as percentage of net sales | 10.00% |
BALANCE SHEET COMPONENTS (Detai
BALANCE SHEET COMPONENTS (Details) - USD ($) | 3 Months Ended | |||
Mar. 27, 2016 | Mar. 29, 2015 | Dec. 31, 2015 | ||
BALANCE SHEET COMPONENTS [Abstract] | ||||
Accounts receivable | $ 9,094,000 | $ 10,659,000 | ||
Allowance for doubtful accounts | (55,000) | (63,000) | ||
Accounts receivable, net | 9,039,000 | 10,596,000 | [1] | |
Property and equipment [Line Items] | ||||
Property and equipment, gross | 18,531,000 | 18,350,000 | ||
Accumulated depreciation and amortization | (15,612,000) | (15,217,000) | ||
Property and equipment, net | 2,919,000 | 3,133,000 | [1] | |
Depreciation expense related to property and equipment | 338,000 | $ 415,000 | ||
Amortization of prepaid licenses | 305,000 | $ 252,000 | ||
Inventory, net [Abstract] | ||||
Raw materials | 2,126,000 | 2,379,000 | ||
Work in process | 3,603,000 | 2,710,000 | ||
Finished goods | 1,242,000 | 1,791,000 | ||
Inventories | 6,971,000 | 6,880,000 | [1] | |
Accrued and other current liabilities [Abstract] | ||||
Amounts billed to the U.S. government in excess of approved rates | 191,000 | 191,000 | ||
Warranty liability | 286,000 | 325,000 | ||
Customer deposits | 353,000 | 342,000 | ||
Sales return reserve | 125,000 | 490,000 | ||
Accrual legal and accounting | 631,000 | 129,000 | ||
Other | 710,000 | 742,000 | ||
Other current liabilities | 2,296,000 | 2,219,000 | [1] | |
Other long term liabilities [Abstract] | ||||
Long term deferred income tax | 323,000 | 318,000 | ||
Long term income taxes payable for unrecognized tax benefits | 434,000 | 434,000 | ||
Other | 154,000 | 160,000 | ||
Total other long term liabilities | 911,000 | 912,000 | [1] | |
Network and Laboratory Equipment [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, gross | $ 13,660,000 | 13,520,000 | ||
Network and Laboratory Equipment [Member] | Minimum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 3 years | |||
Network and Laboratory Equipment [Member] | Maximum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 5 years | |||
Computer Software and Equipment [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, gross | $ 4,227,000 | 4,207,000 | ||
Computer Software and Equipment [Member] | Minimum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 2 years | |||
Computer Software and Equipment [Member] | Maximum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 3 years | |||
Furniture And Fixtures [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, gross | $ 165,000 | 165,000 | ||
Furniture And Fixtures [Member] | Minimum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 3 years | |||
Furniture And Fixtures [Member] | Maximum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 7 years | |||
Office Equipment [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, gross | $ 143,000 | 142,000 | ||
Office Equipment [Member] | Minimum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 3 years | |||
Office Equipment [Member] | Maximum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 5 years | |||
Leasehold Improvements [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, gross | $ 336,000 | $ 316,000 | ||
Leasehold Improvements [Member] | Minimum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 1 year | |||
Leasehold Improvements [Member] | Maximum [Member] | ||||
Property and equipment [Line Items] | ||||
Property and equipment, useful life | 5 years | |||
[1] | The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited consolidated financial statements as of that date. |
FAIR VALUE (Details)
FAIR VALUE (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 10, 2015 | Dec. 24, 2013 | Jul. 07, 2010 | Mar. 27, 2016 | Mar. 29, 2015 | Dec. 31, 2015 | Mar. 27, 2016 | Dec. 31, 2015 | Dec. 16, 2014 |
Class of Warrant or Right [Line Items] | |||||||||
Additional equity shares issued (in shares) | 10,643,000 | 9,573,750 | 2,760,000 | ||||||
Share price of additional equity offering (in dollars per share) | $ 1.70 | $ 1.42 | $ 1.75 | ||||||
Warrants subject to liability accounting [Abstract] | |||||||||
Adjusted warrants (in shares) | 160,698 | ||||||||
Price per share (in dollars per share) | $ 5.25 | $ 8.50 | |||||||
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||||||||
Cash equivalents [Abstract] | |||||||||
Total assets, fair value | $ 12,371 | $ 12,364 | |||||||
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Money Market Funds [Member] | |||||||||
Cash equivalents [Abstract] | |||||||||
Cash equivalents | 12,371 | 12,364 | |||||||
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Liability Warrants [Member] | |||||||||
Current liabilities [Abstract] | |||||||||
Liability warrants | 0 | 0 | |||||||
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||||||
Cash equivalents [Abstract] | |||||||||
Total assets, fair value | 0 | 0 | |||||||
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Money Market Funds [Member] | |||||||||
Cash equivalents [Abstract] | |||||||||
Cash equivalents | 0 | 0 | |||||||
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Liability Warrants [Member] | |||||||||
Current liabilities [Abstract] | |||||||||
Liability warrants | 0 | 0 | |||||||
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||||||
Cash equivalents [Abstract] | |||||||||
Total assets, fair value | 0 | 0 | |||||||
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Money Market Funds [Member] | |||||||||
Cash equivalents [Abstract] | |||||||||
Cash equivalents | 0 | 0 | |||||||
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Liability Warrants [Member] | |||||||||
Current liabilities [Abstract] | |||||||||
Liability warrants | 30 | 39 | |||||||
Carrying Value [Member] | Recurring [Member] | |||||||||
Cash equivalents [Abstract] | |||||||||
Total assets, fair value | 12,371 | 12,364 | |||||||
Carrying Value [Member] | Recurring [Member] | Money Market Funds [Member] | |||||||||
Cash equivalents [Abstract] | |||||||||
Cash equivalents | 12,371 | 12,364 | |||||||
Carrying Value [Member] | Recurring [Member] | Liability Warrants [Member] | |||||||||
Current liabilities [Abstract] | |||||||||
Liability warrants | 30 | 39 | |||||||
Liability Warrants [Member] | |||||||||
Warrants subject to liability accounting [Abstract] | |||||||||
Fair value | $ 39 | $ 39 | $ 30 | $ 39 | |||||
Exercise of warrants | 0 | ||||||||
Change in fair value | (9) | ||||||||
Change in fair value of Level 3 liability warrants [Roll Forward] | |||||||||
Fair value, beginning of period | 39 | ||||||||
Exercise of warrants | 0 | ||||||||
Change in fair value | (9) | ||||||||
Fair value, end of period | $ 30 | $ 39 | |||||||
Bridge Bank Warrant [Member] | |||||||||
Fair value assumptions [Abstract] | |||||||||
Stock price (in dollars per share) | $ 2.75 | $ 3.04 | |||||||
Exercise price (in dollars per share) | 2.31 | 2.31 | |||||||
Expected life | 1 year 3 months 22 days | 1 year 6 months 18 days | |||||||
Risk-free interest rate | 0.71% | 0.86% | |||||||
Volatility | 62.00% | 62.00% | |||||||
Fair value per share (in dollars per share) | $ 0.95 | $ 1.23 | |||||||
Warrants subject to liability accounting [Abstract] | |||||||||
Holder | Bridge Bank | ||||||||
Original warrants (in shares) | 20,000 | ||||||||
Adjusted warrants (in shares) | 31,573 | ||||||||
Grant date | Apr. 7, 2010 | ||||||||
Expiration date | Jul. 7, 2017 | ||||||||
Price per share (in dollars per share) | $ 2.31 | ||||||||
Fair value | $ 30 | $ 39 | $ 30 | $ 39 | |||||
Exercise of warrants | 0 | $ 0 | |||||||
Change in fair value | $ (9) | (1) | |||||||
Related agreement | Credit Agreement | ||||||||
Change in fair value of Level 3 liability warrants [Roll Forward] | |||||||||
Fair value, beginning of period | $ 39 | ||||||||
Exercise of warrants | 0 | 0 | |||||||
Change in fair value | (9) | $ (1) | |||||||
Fair value, end of period | $ 30 | $ 39 |
INTANGIBLE ASSETS AND GOODWIL31
INTANGIBLE ASSETS AND GOODWILL (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 27, 2016 | Mar. 29, 2015 | Dec. 31, 2015 | ||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Gross | $ 10,920 | $ 10,920 | ||
Definite-lived intangible assets, Accumulated Amortization | (7,093) | (6,773) | ||
Definite-lived intangible assets, Net | 3,827 | 4,147 | ||
Amortization of intangible assets | 320 | $ 223 | ||
Intangible Assets, Net [Abstract] | ||||
Total intangible assets, Gross | 11,303 | 11,303 | ||
Definite-lived intangible assets, Accumulated Amortization | (7,093) | (6,773) | ||
Total intangible assets, Net | 4,210 | 4,530 | [1] | |
Cost of Revenue [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Amortization of intangible assets | 103 | 103 | ||
Research and Development Expense [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Amortization of intangible assets | 97 | 0 | ||
Selling, General and Administrative Expenses [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Amortization of intangible assets | 120 | $ 120 | ||
Customer Relationships [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Gross | 3,277 | 3,277 | ||
Definite-lived intangible assets, Accumulated Amortization | (2,647) | (2,542) | ||
Definite-lived intangible assets, Net | 630 | 735 | ||
Intangible Assets, Net [Abstract] | ||||
Definite-lived intangible assets, Accumulated Amortization | (2,647) | (2,542) | ||
Existing Technology [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Gross | 6,527 | 6,527 | ||
Definite-lived intangible assets, Accumulated Amortization | (3,585) | (3,386) | ||
Definite-lived intangible assets, Net | 2,942 | 3,141 | ||
Intangible Assets, Net [Abstract] | ||||
Definite-lived intangible assets, Accumulated Amortization | (3,585) | (3,386) | ||
Patents [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Gross | 457 | 457 | ||
Definite-lived intangible assets, Accumulated Amortization | (409) | (407) | ||
Definite-lived intangible assets, Net | 48 | 50 | ||
Intangible Assets, Net [Abstract] | ||||
Definite-lived intangible assets, Accumulated Amortization | (409) | (407) | ||
Trade Name [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Gross | 659 | 659 | ||
Definite-lived intangible assets, Accumulated Amortization | (452) | (438) | ||
Definite-lived intangible assets, Net | 207 | 221 | ||
Intangible Assets, Net [Abstract] | ||||
Definite-lived intangible assets, Accumulated Amortization | $ (452) | (438) | ||
Minimum [Member] | Customer Relationships [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Life | 6 years | |||
Minimum [Member] | Existing Technology [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Life | 6 years | |||
Minimum [Member] | Patents [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Life | 5 years | |||
Minimum [Member] | Trade Name [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Life | 2 years | |||
Maximum [Member] | Customer Relationships [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Life | 8 years | |||
Maximum [Member] | Existing Technology [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Life | 7 years | |||
Maximum [Member] | Patents [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Life | 16 years | |||
Maximum [Member] | Trade Name [Member] | ||||
Definite-lived intangible assets [Abstract] | ||||
Definite-lived intangible assets, Life | 10 years | |||
IPR&D [Member] | ||||
Indefinite-lived Intangible assets [Abstract] | ||||
Indefinite-lived Intangible assets | $ 383 | $ 383 | ||
[1] | The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited consolidated financial statements as of that date. |
INTANGIBLE ASSETS AND GOODWILL,
INTANGIBLE ASSETS AND GOODWILL, Estimated Future Amortization Expense Related to Intangible Assets and Acquisition Related Goodwill (Details) - USD ($) $ in Thousands | Mar. 27, 2016 | Dec. 31, 2015 | |
Future amortization expense [Abstract] | |||
2,016 | $ 937 | ||
2,017 | 875 | ||
2,018 | 451 | ||
2,019 | 442 | ||
2,020 | 394 | ||
Thereafter | 728 | ||
Total | 3,827 | $ 4,147 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill related to acquisition | $ 12,565 | $ 12,565 | [1] |
[1] | The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited consolidated financial statements as of that date. |
CREDIT FACILITIES (Details)
CREDIT FACILITIES (Details) - Silicon Valley Bank [Member] - Line of Credit [Member] - USD ($) $ in Millions | 3 Months Ended | 4 Months Ended |
Mar. 27, 2016 | May. 15, 2015 | |
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | $ 7 | |
Borrowing base percentage used for maximum borrowing capacity | 80.00% | |
Debt instrument, increase in default interest rate | 3.00% | 5.00% |
Loan agreement expiration date | May 6, 2016 | |
Amount outstanding | $ 0 | |
Prime Rate [Member] | ||
Line of Credit Facility [Line Items] | ||
Debt instrument, applicable interest rate | 0.40% | 0.60% |
STOCKHOLDERS' EQUITY AND STOC34
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 24, 2016 | Mar. 21, 2016 | Sep. 10, 2015 | Dec. 24, 2013 | Jul. 07, 2010 | Mar. 27, 2016 | Mar. 29, 2015 | Dec. 31, 2015 | [1] | Dec. 16, 2014 | Nov. 30, 2014 | Jan. 06, 2012 | Dec. 31, 2008 |
Private Equity Placement [Abstract] | |||||||||||||
Equity shares issued (in shares) | 10,643,000 | 9,573,750 | 2,760,000 | ||||||||||
Common stock purchase price per share (in dollars per share) | $ 1.70 | $ 1.42 | $ 1.75 | ||||||||||
Net proceeds classified outside permanent equity | $ 5,000 | $ 0 | |||||||||||
Common Stock, Number of Shares, Par Value and Other Disclosures [Abstract] | |||||||||||||
Preferred stock, authorized (in shares) | 1,000,000 | 1,000,000 | |||||||||||
Fractional share of preferred stock each preferred share purchase right is entitled to (in shares) | 1 | ||||||||||||
Common and preferred stock [Abstract] | |||||||||||||
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 | 100,000,000 | 50,000,000 | |||||||||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |||||||||||
Preferred stock, issued (in shares) | 0 | 0 | |||||||||||
Preferred stock, outstanding (in shares) | 0 | 0 | |||||||||||
Stockholders rights plan number of years to extend expiration date | 3 years | ||||||||||||
Stockholders rights plan expiration date | Dec. 16, 2017 | ||||||||||||
Exercise price per share (in dollars per share) | $ 5.25 | $ 8.50 | |||||||||||
Common stock dividends, number of preferred stock purchase rights per share (in shares) | 1 | 1 | |||||||||||
Minimum ownership percentage of beneficial owner for exercisability of rights to purchase preferred stock to be triggered | 10.00% | ||||||||||||
Minimum percentage of additional purchase of outstanding shares by existing owner of 10 percent or more for exercisability of rights to purchase preferred stock to be triggered | 1.00% | ||||||||||||
Preferred stock, voting rights | Each share of preferred stock has voting rights equal to one thousand shares of common stock | ||||||||||||
Private Equity Placement [Member] | PSTI Agreement [Member] | |||||||||||||
Private Equity Placement [Abstract] | |||||||||||||
Common stock, purchase price | $ 5,000 | ||||||||||||
Equity shares issued (in shares) | 1,754,385 | ||||||||||||
Common stock purchase price per share (in dollars per share) | $ 2.85 | ||||||||||||
Percentage of aggregate purchase price on monthly, prorated basis | 0.40% | ||||||||||||
Percentage of interest on liquidated damages accrued | 1.00% | ||||||||||||
Percentage of interest on return of full purchase price | 0.40% | ||||||||||||
Amount of reimbursed expenses in connection with negotiation | $ 15,000 | ||||||||||||
Net proceeds classified outside permanent equity | $ 4,700 | ||||||||||||
Series A Junior Preferred Stock [Member] | |||||||||||||
Common Stock, Number of Shares, Par Value and Other Disclosures [Abstract] | |||||||||||||
Preferred stock, authorized (in shares) | 750,000 | ||||||||||||
Fractional share of preferred stock each preferred share purchase right is entitled to (in shares) | 1 | ||||||||||||
[1] | The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited consolidated financial statements as of that date. |
STOCKHOLDERS' EQUITY AND STOC35
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Share-based Compensation Arrangements by Share-based Payment Award (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Mar. 27, 2016 | Mar. 29, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Sep. 25, 2015 | Dec. 31, 2008 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Warrants outstanding (in shares) | 160,698 | |||||
Stock Options [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation expense | $ 76,000 | |||||
Weighted average period of recognition for unrecognized compensation cost | 11 months 12 days | |||||
Stock price (in dollars per share) | $ 2.75 | |||||
Total grant date fair value options | $ 0 | $ 0 | ||||
Aggregate Intrinsic Value [Abstract] | ||||||
Aggregate intrinsic value, exercised | 132,000 | $ 8,000 | ||||
Aggregate intrinsic value, vested and expected to vest | 5,100,000 | |||||
Restricted Stock Units (RSUs) [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation expense | $ 8,900,000 | |||||
Weighted average period of recognition for unrecognized compensation cost | 2 years 10 months 6 days | |||||
Stock option activity, weighted-average exercise price [Roll Forward] | ||||||
Weighted average exercise price, granted (in dollars per shares) | $ 2.97 | |||||
Restricted stock activity, number of shares [Roll Forward] | ||||||
Outstanding, beginning of period (in shares) | 4,361,833 | |||||
Granted (in shares) | 1,333,623 | 2,815,822 | ||||
Released (in shares) | (296,720) | |||||
Forfeited/expired (in shares) | (28,542) | |||||
Outstanding, end of period (in shares) | 5,370,194 | 4,361,833 | ||||
Total grant date fair value | $ 4,000,000 | $ 3,500,000 | ||||
Restricted stock activity, Weighted Average Grant Date Fair Value [Roll Forward] | ||||||
Outstanding, beginning of period (in dollars per share) | $ 1.64 | |||||
Granted (in dollars per share) | 2.97 | $ 1.25 | ||||
Released (in dollars per share) | 2.16 | |||||
Forfeited/expired (in dollars per share) | 1.84 | |||||
Outstanding, end of period (in dollars per share) | $ 1.94 | $ 1.64 | ||||
Restricted stock activity, Weighted-average Remaining Vesting Term, Years [Abstract] | ||||||
Weighted-average remaining vesting term, outstanding | 2 years 10 months 6 days | 2 years 10 months 10 days | ||||
Restricted stock activity, Aggregate Intrinsic Value [Roll Forward] | ||||||
Aggregate intrinsic value outstanding beginning balance | $ 13,260,000 | |||||
Aggregate intrinsic value outstanding ending balance | 14,768,000 | $ 13,260,000 | ||||
Aggregate intrinsic value of vested | $ 988,000 | |||||
Shares withheld to satisfy minimum tax obligation (in shares) | 117,221 | |||||
Amount withheld to satisfy minimum tax obligation | $ 395,000 | |||||
Restricted Stock Units (RSUs) [Member] | Minimum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 1 month | |||||
Restricted Stock Units (RSUs) [Member] | Maximum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
2007 Equity Incentive Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares authorized (in shares) | 632,500 | |||||
2007 Equity Incentive Plan [Member] | Stock Options [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of options and restricted stock units outstanding (in shares) | 375,663 | |||||
Vesting period | 4 years | |||||
Life from date of grant | 10 years | |||||
Stock options cancelled (in shares) | 864 | |||||
2007 Equity Incentive Plan [Member] | Warrant [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Warrants outstanding (in shares) | 4,125 | |||||
2008 Equity Incentive Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares authorized (in shares) | 21,000,000 | 18,280,238 | ||||
Automatic annual increase in shares authorized | lesser of (i) 5% of the number of shares of common stock outstanding as of the Company’s immediately preceding fiscal year, or (ii) a number of shares determined by the Board of Directors | |||||
Percentage of outstanding common stock | 5.00% | |||||
Automatic increase in number of shares reserved for future issuance (in shares) | 2,260,527 | |||||
Number of options and restricted stock units outstanding (in shares) | 12,720,084 | |||||
Number of shares authorized for future issuance (in shares) | 2,448,789 | |||||
2008 Equity Incentive Plan [Member] | Stock Options [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares authorized (in shares) | 2,500,000 | |||||
Vesting period | 4 years | |||||
Cliff vesting per year | 25.00% | |||||
Life from date of grant | 10 years | |||||
2008 Equity Incentive Plan [Member] | Stock Options [Member] | Minimum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Exercise price of stock options as percentage of fair market value on date of grant | 100.00% | |||||
2008 Equity Incentive Plan [Member] | Stock Options [Member] | Maximum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Exercise price of stock options as percentage of fair market value on date of grant | 110.00% | |||||
2008 Equity Incentive Plan [Member] | Restricted Stock Units (RSUs) [Member] | Minimum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 1 year | |||||
Vesting period | 3 quarters | |||||
2008 Equity Incentive Plan [Member] | Restricted Stock Units (RSUs) [Member] | Maximum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Lumera 2000 and 2004 Stock Option Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Merger conversion ratio | 12.50% | |||||
Lumera 2000 and 2004 Stock Option Plan [Member] | Stock Options [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of options and restricted stock units outstanding (in shares) | 57,191 | |||||
Equity Incentive Plans 2000 through 2008 [Member] | Stock Options [Member] | ||||||
Stock options activity, number of shares [Roll Forward] | ||||||
Outstanding, beginning of year (in shares) | 7,918,584 | |||||
Granted (in shares) | 0 | |||||
Exercised (in shares) | (132,493) | |||||
Forfeited/Expired (in shares) | (3,347) | |||||
Outstanding, ending balance (in shares) | 7,782,744 | 7,918,584 | ||||
Vested and exercisable and expected to vest (in shares) | 7,774,286 | |||||
Vested and exercisable (in shares) | 7,657,473 | |||||
Stock option activity, weighted-average exercise price [Roll Forward] | ||||||
Weighted average exercise price, beginning balance (in dollars per shares) | $ 2.32 | |||||
Weighted average exercise price, exercised (in dollars per shares) | 2.10 | |||||
Weighted average exercise price, forfeited/expired (in dollars per shares) | 2.49 | |||||
Outstanding, ending balance (in dollars per shares) | 2.32 | $ 2.32 | ||||
Weighted average exercise price, vested and exercisable and expected to vest (in dollars per share) | 2.33 | |||||
Weighted average exercise price, vested and exercisable (in dollars per share) | $ 2.35 | |||||
Weighted average remaining contractual term [Abstract] | ||||||
Weighted average remaining contractual term, outstanding | 4 years 6 months 14 days | 4 years 9 months 25 days | ||||
Weighted average remaining contractual term, vested and exercisable and expected to vest | 4 years 6 months 14 days | |||||
Weighted average remaining contractual term, vested and exercisable | 4 years 6 months |
STOCKHOLDERS' EQUITY AND STOC36
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Warrants (Details) | 3 Months Ended |
Mar. 27, 2016shares | |
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION [Abstract] | |
Warrants outstanding (in shares) | 160,698 |
Number of warrants exercised (in shares) | 0 |
Number of warrants expired (in shares) | 0 |
STOCKHOLDERS' EQUITY AND STOC37
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Allocation of Recognized Period Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock based compensation expense | $ 1,285 | $ 889 |
Cost of Revenue [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock based compensation expense | 86 | 82 |
Research and Development Expense [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock based compensation expense | 323 | 247 |
Selling, General and Administrative Expenses [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock based compensation expense | $ 876 | $ 560 |
INVESTMENT IN UNCONSOLIDATED 38
INVESTMENT IN UNCONSOLIDATED AFFILIATES (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Jun. 28, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Mar. 27, 2016 | Jan. 25, 2016 | Feb. 28, 2014 | ||
Schedule of Investments [Line Items] | |||||||
Inventory | $ 6,880,000 | [1] | $ 6,971,000 | ||||
Property and equipment | 3,133,000 | [1] | $ 2,919,000 | ||||
CPqD [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Joint venture ownership percentage | 51.00% | ||||||
BrP [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Inventory | $ 245,000 | ||||||
Property and equipment | $ 211,000 | ||||||
Additional capital contribution | $ 3,000 | ||||||
Investment in affiliate | $ 459,000 | ||||||
Loss attributable to affiliate | (3,000) | $ (456,000) | |||||
Written down value in investment in unconsolidated affiliate | $ 0 | ||||||
Anagog Ltd [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Investment in affiliate | $ 1,200,000 | ||||||
Anagog Ltd [Member] | Other Assets [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Cost method investments | $ 1,200,000 | ||||||
GigPeak, Inc. [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Joint venture ownership percentage | 49.00% | ||||||
[1] | The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited consolidated financial statements as of that date. |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
INCOME TAXES [Abstract] | ||
Provision for income taxes | $ 40 | $ 9 |
NET LOSS PER SHARE (Details)
NET LOSS PER SHARE (Details) - shares | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Outstanding anti-dilutive securities (in shares) | 13,313,636 | 13,382,520 |
Stock options and RSUs [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Outstanding anti-dilutive securities (in shares) | 13,152,938 | 12,724,280 |
Common Stock Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Outstanding anti-dilutive securities (in shares) | 160,698 | 658,240 |
SEGMENT AND GEOGRAPHIC INFORM41
SEGMENT AND GEOGRAPHIC INFORMATION (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 27, 2016USD ($)CustomerDistributor | Mar. 29, 2015USD ($)Customer | Dec. 31, 2015USD ($) | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | $ 11,362 | $ 9,060 | |
Number of customers | Customer | 3 | 3 | |
Number of distributors | Distributor | 2 | ||
Long-lived assets | $ 2,919 | $ 3,133 | |
Customer One, Two, Three and Distributor One and Two [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 49.00% | ||
Customer One, Two and Three [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 51.00% | ||
Revenue [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 100.00% | 100.00% | |
Long-Lived Assets [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 100.00% | 100.00% | |
Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 22.00% | 29.00% | |
United States [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 41.00% | 27.00% | |
Far East [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 32.00% | 25.00% | |
Reportable Geographical Components [Member] | North America [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | $ 4,728 | $ 3,031 | |
Reportable Geographical Components [Member] | North America [Member] | Revenue [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 42.00% | 33.00% | |
Reportable Geographical Components [Member] | Asia [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | $ 3,841 | $ 2,819 | |
Long-lived assets | $ 16 | $ 18 | |
Reportable Geographical Components [Member] | Asia [Member] | Revenue [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 34.00% | 31.00% | |
Reportable Geographical Components [Member] | Asia [Member] | Long-Lived Assets [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 0.00% | 1.00% | |
Reportable Geographical Components [Member] | Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | $ 2,793 | $ 2,953 | |
Reportable Geographical Components [Member] | Europe [Member] | Revenue [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 24.00% | 33.00% | |
Reportable Geographical Components [Member] | Other [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | $ 0 | $ 257 | |
Reportable Geographical Components [Member] | Other [Member] | Revenue [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 0.00% | 3.00% | |
Reportable Geographical Components [Member] | United States [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | $ 2,471 | $ 2,680 | |
Reportable Geographical Components [Member] | United States [Member] | Long-Lived Assets [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 85.00% | 85.00% | |
Reportable Geographical Components [Member] | Switzerland [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | $ 432 | $ 435 | |
Reportable Geographical Components [Member] | Switzerland [Member] | Long-Lived Assets [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 15.00% | 14.00% |
COMMITMENTS AND CONTINGENCIES42
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | 3 Months Ended | |
Mar. 27, 2016 | Mar. 29, 2015 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | ||
Facilities rent expense | $ 142,000 | $ 111,000 |
Aggregate non-cancelable future minimum rental payments under capital leases [Abstract] | ||
Capital leases, 2016 (remainder of the year) | 2,000 | |
Capital leases, 2017 | 3,000 | |
Capital leases, 2018 | 0 | |
Capital leases, 2019 | 0 | |
2020 and beyond | 0 | |
Capital leases, total minimum lease payments | 5,000 | |
Less: Amount representing interest | 0 | |
Total capital lease obligations | 5,000 | |
Less: current portion | (3,000) | |
Long-term portion of capital lease obligations | 2,000 | |
Aggregate non-cancelable future minimum rental payments under operating leases [Abstract] | ||
Operating leases, 2016 (remainder of the year) | 498,000 | |
Operating leases, 2017 | 227,000 | |
Operating leases, 2018 | 73,000 | |
Operating Leases, 2019 | 73,000 | |
2020 and beyond | 61,000 | |
Operating leases, total minimum lease payments | $ 932,000 | |
Approximate period of product warranty | 1 year | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Beginning balance | $ 325,000 | 334,000 |
Warranties accrued | 8,000 | 197,000 |
Warranties settled | (47,000) | (162,000) |
Ending balance | $ 286,000 | $ 369,000 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ / shares in Units, $ in Millions | Apr. 05, 2016USD ($)Installment$ / sharesshares | Mar. 27, 2016$ / shares | Dec. 16, 2014$ / shares |
Subsequent Event [Line Items] | |||
Exercise price of warrants (in dollars per share) | $ / shares | $ 5.25 | $ 8.50 | |
Subsequent Events [Member] | Magnum [Member] | |||
Subsequent Event [Line Items] | |||
Number of shares issued to acquire business (in shares) | shares | 6,900,000 | ||
Cash paid on acquisition | $ 36.2 | ||
Subsequent Events [Member] | Line of Credit - Silicon Valley Bank [Member] | |||
Subsequent Event [Line Items] | |||
Line of credit amount borrowed | 22.1 | ||
Maximum borrowing capacity | 29 | ||
Subsequent Events [Member] | Line Of Credit One - Silicon Valley Bank [Member] | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | $ 14 | ||
Borrowing base percentage used for maximum borrowing capacity | 80.00% | ||
Number of installments to be repaid | Installment | 60 | ||
Debt instrument, default interest rate | 3.00% | ||
Subsequent Events [Member] | Line Of Credit One - Silicon Valley Bank [Member] | Warrant One [Member] | |||
Subsequent Event [Line Items] | |||
Warrants outstanding (in shares) | shares | 4,125 | ||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.73 | ||
Subsequent Events [Member] | Line Of Credit One - Silicon Valley Bank [Member] | Warrant Two [Member] | |||
Subsequent Event [Line Items] | |||
Warrants outstanding (in shares) | shares | 125,000 | ||
Exercise price of warrants (in dollars per share) | $ / shares | $ 4 | ||
Subsequent Events [Member] | Line Of Credit One - Silicon Valley Bank [Member] | Prime Rate [Member] | |||
Subsequent Event [Line Items] | |||
Debt instrument, applicable interest rate | 1.25% | ||
Subsequent Events [Member] | Line Of Credit Two - Silicon Valley Bank [Member] | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | $ 15 |