Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 20, 2020 | Jun. 28, 2019 | |
Document Information [Line Items] | |||
Entity Registrant Name | ACM Research, Inc. | ||
Entity Central Index Key | 0001680062 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Shell Company | false | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | true | ||
Entity Public Float | $ 135.6 | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Address, State or Province | CA | ||
Class A Common Stock [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 16,273,528 | ||
Class B Common Stock [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 1,862,608 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 58,261 | $ 27,124 |
Restricted cash | 59,598 | 0 |
Accounts receivable, less allowance for doubtful accounts of $0 as of December 31, 2019 and $0 as of December 31, 2018 (note 3) | 31,091 | 24,608 |
Other receivables | 2,603 | 3,547 |
Inventories (note 4) | 44,796 | 38,764 |
Prepaid expenses | 2,047 | 1,985 |
Total current assets | 198,396 | 96,028 |
Property, plant and equipment, net (note 5) | 3,619 | 3,708 |
Operating lease right-of-use assets, net (note 8) | 3,887 | 0 |
Intangible assets, net | 344 | 274 |
Deferred tax assets (note 15) | 5,331 | 1,637 |
Long-term investments (note 10) | 5,934 | 1,360 |
Other long-term assets | 192 | 40 |
Total assets | 217,703 | 103,047 |
Current liabilities: | ||
Short-term borrowings (note 6) | 13,753 | 9,447 |
Accounts payable | 13,262 | 16,673 |
Advances from customers | 9,129 | 8,417 |
Income taxes payable | 3,129 | 1,193 |
Other payables and accrued expenses (note 7) | 12,874 | 10,410 |
Current portion of operating lease liability (note 8) | 1,355 | 0 |
Total current liabilities | 53,502 | 46,140 |
Long-term operating lease liability (note 8) | 2,532 | 0 |
Other long-term liabilities (note 9) | 4,186 | 4,583 |
Total liabilities | 60,220 | 50,723 |
Commitments and contingencies (note 17) | ||
Redeemable non-controlling interests (note 13) | 60,162 | 0 |
Stockholders' equity: | ||
Additional paid in capital | 83,487 | 56,567 |
Accumulated surplus (deficit) | 15,507 | (3,387) |
Accumulated other comprehensive loss | (1,675) | (857) |
Total stockholders' equity | 97,321 | 52,324 |
Total liabilities, redeemable non-controlling interests, and stockholders' equity | 217,703 | 103,047 |
Class A Common Stock [Member] | ||
Stockholders' equity: | ||
Common stock | 2 | 1 |
Class B Common Stock [Member] | ||
Stockholders' equity: | ||
Common stock | $ 0 | $ 0 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Accounts receivable, allowance for doubtful accounts | $ 0 | $ 0 |
Class A Common Stock [Member] | ||
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 16,182,151 | 14,110,315 |
Common stock, shares outstanding (in shares) | 16,182,151 | 14,110,315 |
Class B Common Stock [Member] | ||
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 2,409,738 | 2,409,738 |
Common stock, shares issued (in shares) | 1,862,608 | 1,898,423 |
Common stock, shares outstanding (in shares) | 1,862,608 | 1,898,423 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Consolidated Statements of Operations and Comprehensive Income [Abstract] | ||
Revenue | $ 107,524 | $ 74,643 |
Cost of revenue | 56,870 | 40,194 |
Gross profit | 50,654 | 34,449 |
Operating expenses: | ||
Sales and marketing | 11,902 | 9,611 |
Research and development | 12,900 | 10,380 |
General and administrative | 8,061 | 7,987 |
Total operating expenses, net | 32,863 | 27,978 |
Income from operations | 17,791 | 6,471 |
Interest income | 333 | 29 |
Interest expense | (745) | (498) |
Other income, net | 1,393 | 1,255 |
Equity income in net income of affiliates | 168 | 123 |
Income before income taxes | 18,940 | 7,380 |
Income tax benefit (expense) (note 15) | 518 | (806) |
Net income | 19,458 | 6,574 |
Less: Net income attributable to redeemable non-controlling interests | 564 | 0 |
Net income available to common stockholders, basic and diluted | 18,894 | 6,574 |
Comprehensive income: | ||
Net income | 19,458 | 6,574 |
Foreign currency translation adjustment | (899) | (979) |
Comprehensive Income (note 2) | 18,559 | 5,595 |
Less: Comprehensive income attributable to redeemable non-controlling interests | 483 | 0 |
Comprehensive income attributable to ACM Research, Inc. | $ 18,076 | $ 5,595 |
Net income attributable to ACM Research, Inc. per common share (note 2): | ||
Basic (in dollars per share) | $ 1.12 | $ 0.42 |
Diluted (in dollars per share) | $ 0.99 | $ 0.37 |
Weighted average common shares outstanding used in computing per share amounts (note 2): | ||
Basic (in shares) | 16,800,623 | 15,788,460 |
Diluted (in shares) | 19,135,497 | 17,912,105 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Stockholders' Equity - USD ($) $ in Thousands | Common Stock [Member]Common Stock Class A [Member] | Common Stock [Member]Common Stock Class B [Member] | Additional Paid-In Capital [Member] | Accumulated Surplus (Deficit) [Member] | Accumulated Other Comprehensive Loss [Member] | Total |
Beginning balance at Dec. 31, 2017 | $ 1 | $ 0 | $ 49,695 | $ (9,961) | $ 122 | $ 39,857 |
Beginning balance (in shares) at Dec. 31, 2017 | 12,935,546 | 2,409,738 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income attributable to ACM Research, Inc. | $ 0 | $ 0 | 0 | 6,574 | 0 | 6,574 |
Foreign currency translation adjustment | 0 | 0 | 0 | 0 | (979) | (979) |
Exercise of stock options | $ 0 | $ 0 | 528 | 0 | 0 | 528 |
Exercise of stock options (in shares) | 265,952 | 0 | ||||
Stock-based compensation | $ 0 | $ 0 | 3,363 | 0 | 0 | 3,363 |
Conversion of Class B common stock to Class A common stock | $ 0 | $ 0 | 0 | 0 | 0 | 0 |
Conversion of Class B common stock to Class A common stock (in shares) | 511,315 | (511,315) | ||||
Exercise of stock warrant issued to SMC/HFG | $ 0 | $ 0 | 2,981 | 0 | 0 | 2,981 |
Exercise of stock warrant issued to SMC/HFG (in shares) | 397,502 | 0 | ||||
Ending balance at Dec. 31, 2018 | $ 1 | $ 0 | 56,567 | (3,387) | (857) | 52,324 |
Ending balance (in shares) at Dec. 31, 2018 | 14,110,315 | 1,898,423 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income attributable to ACM Research, Inc. | $ 0 | $ 0 | 0 | 18,894 | 0 | 18,894 |
Foreign currency translation adjustment | 0 | 0 | 0 | 0 | (818) | (818) |
Exercise of stock options | $ 0 | $ 0 | 317 | 0 | 0 | 317 |
Exercise of stock options (in shares) | 195,297 | 0 | ||||
Cancellation of stock options | (576) | (576) | ||||
Stock-based compensation | $ 0 | $ 0 | 3,572 | 0 | 0 | 3,572 |
Issuance of Class A common stock in connection with public offering | $ 1 | $ 0 | 26,434 | 0 | 0 | 26,435 |
Issuance of Class A common stock in connection with public offering (in shares) | 2,053,572 | 0 | ||||
Share repurchase | (2,827) | (2,827) | ||||
Share repurchase (in shares) | (214,286) | |||||
Conversion of Class B common stock to Class A common stock | $ 0 | $ 0 | 0 | 0 | 0 | $ 0 |
Conversion of Class B common stock to Class A common stock (in shares) | 35,815 | (35,815) | 35,815 | |||
Exercise of stock warrant issued to SMC/HFG | $ 0 | $ 0 | 0 | 0 | 0 | $ 0 |
Exercise of stock warrant issued to SMC/HFG (in shares) | 1,438 | 0 | ||||
Ending balance at Dec. 31, 2019 | $ 2 | $ 0 | $ 83,487 | $ 15,507 | $ (1,675) | $ 97,321 |
Ending balance (in shares) at Dec. 31, 2019 | 16,182,151 | 1,862,608 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 19,458 | $ 6,574 |
Adjustments to reconcile net income from operations to net cash used in operating activities: | ||
Depreciation and amortization | 788 | 417 |
Loss on disposals of property, plant and equipment | 294 | 0 |
Equity income in net income of affiliates | (168) | (123) |
Deferred income taxes | (3,719) | (405) |
Stock-based compensation | 3,572 | 3,363 |
Net changes in operating assets and liabilities: | ||
Accounts receivable | (6,961) | 883 |
Other receivables | 891 | (1,171) |
Inventory | (6,658) | (24,083) |
Prepaid expenses | (83) | (1,494) |
Other long-term assets | (151) | 44 |
Accounts payable | (3,058) | 9,825 |
Advances from customers | 705 | 8,316 |
Income tax payable | 1,952 | 1,149 |
Other payables and accrued expenses | 2,865 | 4,954 |
Other long-term liabilities | (324) | (1,340) |
Net cash provided by operating activities | 9,403 | 6,909 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (971) | (1,830) |
Purchase of intangible assets | (154) | (241) |
Investments in unconsolidated affiliates | (4,406) | 0 |
Net cash used in investing activities | (5,531) | (2,071) |
Cash flows from financing activities: | ||
Proceeds from short-term borrowings | 18,423 | 17,726 |
Repayments of short-term borrowings | (14,005) | (13,131) |
Proceeds from stock option exercise to common stock | 317 | 528 |
Proceeds from issuance of Class A common stock in connection with public offering, net of direct issuance expenses of $2,287 | 26,434 | 0 |
Payment for repurchase of Class A common stock | (2,827) | 0 |
Payment for cancellation of stock option | (576) | 0 |
Proceeds from issuance of common stock to redeemable Non-controlling interest | 59,679 | 0 |
Net cash provided by financing activities | 87,445 | 5,123 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (582) | (518) |
Net increase in cash, cash equivalents and restricted cash | 90,735 | 9,443 |
Cash, cash equivalents and restricted cash at beginning of period | 27,124 | 17,681 |
Cash, cash equivalents and restricted cash at end of period | 117,859 | 27,124 |
Supplemental disclosure of cash flow information: | ||
Interest paid | 745 | 498 |
Cash paid for income taxes | 1,156 | 0 |
Reconciliation of cash, cash equivalents and restricted cash in condensed consolidated statements of cash flows: | ||
Cash and cash equivalents | 58,261 | 27,124 |
Restricted cash | 59,598 | 0 |
Non-cash financing activities: | ||
Warrant conversion to common stock | $ 9 | $ 3,079 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Cash flows from financing activities: | |
Direct issuance expenses | $ 2,287 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 12 Months Ended |
Dec. 31, 2019 | |
DESCRIPTION OF BUSINESS [Abstract] | |
DESCRIPTION OF BUSINESS | NOTE 1 – DESCRIPTION OF BUSINESS ACM Research, Inc. (“ACM”) and its subsidiaries (collectively with ACM, the “Company”) develop, manufacture and sell single-wafer wet cleaning equipment used to improve the manufacturing process and yield for advanced integrated chips. The Company markets and sells its single-wafer wet-cleaning equipment, under the brand name “Ultra C,” based on the Company’s proprietary Space Alternated Phase Shift (“SAPS”) and Timely Energized Bubble Oscillation (“TEBO”) technologies. These tools are designed to remove random defects from a wafer surface efficiently, without damaging the wafer or its features, even at increasingly advanced process nodes. ACM was incorporated in California in 1998, and it initially focused on developing tools for manufacturing process steps involving the integration of ultra low-K materials and copper. The Company’s early efforts focused on stress-free copper-polishing technology, and it sold tools based on that technology in the early 2000s. In 2006 the Company established its operational center in Shanghai in the People’s Republic of China (the “PRC”), where it operates through ACM’s subsidiary ACM Research (Shanghai), Inc. (“ACM Shanghai”). ACM Shanghai was formed to help establish and build relationships with integrated circuit manufacturers in the PRC, and the Company initially financed its Shanghai operations in part through sales of non-controlling equity interests in ACM Shanghai. In 2007 the Company began to focus its development efforts on single-wafer wet-cleaning solutions for the front-end chip fabrication process. The Company introduced its SAPS megasonic technology, which can be applied in wet wafer cleaning at numerous steps during the chip fabrication process, in 2009. It introduced its TEBO technology, which can be applied at numerous steps during the fabrication of small node two-dimensional conventional and three-dimensional patterned wafers, in March 2016. The Company has designed its equipment models for SAPS and TEBO solutions using a modular configuration that enables it to create a wet-cleaning tool meeting the specific requirements of a customer, while using pre-existing designs for chamber, electrical, chemical delivery and other modules. In August 2018, the Company introduced its Ultra-C Tahoe wafer cleaning tool, which can deliver high cleaning performance with significantly less sulfuric acid than typically consumed by conventional high-temperature single-wafer cleaning tools. Based on its electro-chemical plating (“ECP”) technology, the Company introduced in March 2019 its Ultra ECP AP, or “Advanced Packaging,” tool for bumping, or applying copper, tin and nickel to semiconductor wafers at the die-level, and its Ultra ECP MAP, or “Multi-Anode Partial Plating,” tool to deliver advanced electrochemical copper plating for copper interconnect applications in front-end wafer fabrication processes. The Company also offers a range of custom-made equipment, including cleaners, coaters and developers, to back-end wafer assembly and packaging factories, principally in the PRC. In 2011 ACM Shanghai formed a wholly owned subsidiary in the PRC, ACM Research (Wuxi), Inc. (“ACM Wuxi”), to manage sales and service operations. In November 2016 ACM redomesticated from California to Delaware pursuant to a merger in which ACM Research, Inc., a California corporation, was merged into a newly formed, wholly owned Delaware subsidiary, also named ACM Research, Inc. In June 2017 ACM formed a wholly owned subsidiary in Hong Kong, CleanChip Technologies Limited (“CleanChip”), to act on the Company’s behalf in Asian markets outside the PRC by, for example, serving as a trading partner between ACM Shanghai and its customers, procuring raw materials and components, performing sales and marketing activities, and making strategic investments. In August 2017 ACM purchased 18.77% of ACM Shanghai’s equity interests held by Shanghai Science and Technology Venture Capital Co., Ltd. On November 8, 2017, ACM purchased the remaining 18.36% of ACM Shanghai’s equity interest held by third parties, Shanghai Pudong High-Tech Investment Co., Ltd. (“PDHTI”) and Shanghai Zhangjiang Science & Technology Venture Capital Co., Ltd. (“ZSTVC”). At December 31, 2017, ACM owned all of the outstanding equity interests of ACM Shanghai, and indirectly through ACM Shanghai, owned all of the outstanding equity interests of ACM Wuxi. On September 13, 2017, ACM effectuated a 1-for-3 reverse stock split of Class A and Class B common stock. Unless otherwise indicated, all share numbers, per share amount, share prices, exercise prices and conversion rates set forth in these notes and the accompanying condensed consolidated financial statements have been adjusted retrospectively to reflect the reverse stock split. On November 2, 2017, the Registration Statement on Form S-1 (File No. 333- 220451) for ACM’s initial public offering of Class A common stock (the “IPO”) was declared effective by the U.S. Securities and Exchange Commission. Shares of Class A common stock began trading on the Nasdaq Global Market on November 3, 2017, and the closing for the IPO was held on November 7, 2017. In December 2017 ACM formed a wholly owned subsidiary in the Republic of Korea, ACM Research Korea CO., LTD. (“ACM Korea”), to serve customers based in Republic of Korea and perform sales, marketing, research and development activities for new products and solutions. In March 2019 ACM Shanghai formed a wholly owned subsidiary in the PRC, Shengwei Research (Shanghai), Inc., to manage activities related to addition of future long-term production capacity. The subsidiary was formed with registered capital of RMB 5,000 ($727). As of December 31, 2019, $142 had been injected into this subsidiary. In June 2019 Cleanchip formed a wholly owned subsidiary in California, ACM Research (CA), Inc. (“ACM California”), to provide procurement services on behalf of ACM Shanghai. On June 17, 2019 ACM announced plans to complete over the next three years a listing (the “Listing”) of shares of ACM Shanghai on the Shanghai Stock Exchange’s new Sci-Tech innovAtion boaRd, known as the STAR Market, and a concurrent initial public offering (the “STAR IPO”) of ACM Shanghai shares in the PRC. ACM Shanghai is currently ACM’s primary operating subsidiary, and at the time of announcement, was wholly owned by ACM. As an initial step in qualifying for the Listing and STAR IPO, on June 12, 2019 ACM Shanghai entered into agreements with seven investors (the “First Tranche Investors”), pursuant to which the First Tranche Investors agreed to pay a purchase price totaling RMB 187,900 (equivalent to $27,300) to ACM Shanghai for shares representing 4.2% of the then-outstanding ACM Shanghai shares. On November 29, 2019 ACM Shanghai entered into agreements with eight PRC-based investment firms (the “Second Tranche Investors”), pursuant to which the Second Tranche Investors agreed to acquire shares of ACM Shanghai for an aggregate of RMB 228,200 (equivalent to $32,400) at a purchase price of RMB 13 for each share, which is the same purchase price per share paid by the First Tranche Investors. Following the issuance of shares to the Second Tranche Investors, 91.7% of the outstanding shares of ACM Shanghai were owned by ACM, 3.8% were owned by the First Tranche Investors, and 4.5% were owned by the Second Tranche Investors. (See note 13). In preparation for the STAR IPO, ACM completed a reorganization in December 2019 that included the sale of all of the shares of Cleanchip by ACM to ACM Shanghai for $3,500. The reorganization and sale had no impact on ACM’s consolidated financial statements. The Company has direct or indirect interests in the following subsidiaries: Place and date of Effective interest held as at Name of subsidiaries incorporation December 31, 2019 December 31, 2018 ACM Research (Shanghai), Inc. China, May 2006 91.7% 100.0% ACM Research (Wuxi), Inc. China, July 2011 91.7% 100.0% CleanChip Technologies Limited Hong Kong, June 2017 91.7% 100.0% ACM Research Korea CO., LTD. Korea, December 2017 91.7% 100.0% Shengwei Research (Shanghai), Inc. China, March 2019 91.7% 100.0% ACM Research (CA), Inc. USA, June 2019 91.7% 100.0% |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Company’s consolidated financial statements include the accounts of the Company and its subsidiaries including ACM and its subsidiary, ACM Shanghai, which includes ACM Wuxi, ACM Shengwei, and CleanChip (ACM California and ACM Korea). Subsidiaries are those entities in which ACM, directly and indirectly, controls more than one half of the voting power. All significant intercompany transactions and balances have been eliminated upon consolidation. Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the balance sheet date and the reported revenues and expenses during the reported period in the consolidated financial statements and accompanying notes. The Company’s significant accounting estimates and assumptions include, but are not limited to, those used for the valuation and recognition of stock-based compensation arrangements and warrant liability, realization of deferred tax assets, assessment for impairment of long-lived assets, allowance for doubtful accounts, inventory valuation for excess and obsolete inventories, lower of cost and market value or net realizable value of inventories, depreciable lives of property and equipment, accrued warranty, and useful life of intangible assets. Management evaluates these estimates and assumptions on a regular basis. Actual results could differ from those estimates and assumptions. Cash and Cash Equivalents Cash and cash equivalents consist of cash on hand, bank deposits that are unrestricted as to withdrawal and use, and highly liquid investments with an original maturity date of three months or less at the date of purchase. At times, cash deposits may exceed government-insured limits. Restricted cash Restricted cash represents deposits not readily available to ACM. Restricted cash as of December 31, 2019 represented cash hold in reserve, all of the proceeds received from issuance of common stock to redeemable Non-controlling interest in segregated cash and cash-equivalent accounts. Accounts Receivable Accounts receivable are presented net of an allowance for doubtful accounts. The Company reviews its accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balance, a customer’s historical payment history and credit worthiness, and current economic trends. Accounts are written off after all collection efforts have been exhausted. At December 31, 2019 and 2018, the Company, based on a review of its outstanding balances and its customers, determined the allowance for doubtful accounts in the amount of $0 and $0 respectively. Inventory Inventory consists of raw materials and related goods, work-in-progress, finished goods, and other consumable materials such as spare parts. Finished goods typically are shipped from the Company’s warehouse within one month of completion. Inventory was recorded at the lower of cost or net realizable value at December 31, 2019 and 2018. ● The cost of a general inventory item is determined using the weighted moving average method. Under the weighted moving average method, the Company calculates the new average price of all items of a particular inventory stock each time one or more items of that stock are purchased. The then-current average price of the stock is used for purposes of determining cost of inventory or cost of revenue. The cost of an inventory item purchased specifically for a customized product is determined using the specific identification method. Low-cost consumable materials and packaging materials are expensed as incurred. ● Net realizable value is the estimated selling price, in the ordinary course of business, less estimated costs to complete or dispose. The Company assesses the recoverability of all inventories quarterly to determine if any adjustments are required. Potential excess or obsolete inventory is written off based on management’s analysis of inventory levels and estimates of future 12-month demand and market conditions. Property, Plant and Equipment, Net Property, plant and equipment are recorded at cost less accumulated depreciation and any provision for impairment in value. Depreciation begins when the asset is placed in service and is calculated by using the straight-line method over the estimated useful life of an asset (or, if shorter, over the lease term). Betterments or renewals are capitalized when incurred. Plant, property and equipment is reviewed each year to determine whether any events or circumstances indicate that the carrying amount of the assets may not be recoverable. Estimated useful lives of assets in the United States are as follows: Computer and office equipment 3 to 5 years Furniture and fixtures 5 years Leasehold improvements shorter of lease term or estimated useful life ACM’s subsidiaries follow regulations for depreciation of fixed assets implemented under the PRC’s Enterprise Income Tax Law, which state that the minimum useful lives used for calculating depreciation for fixed assets are as follows: Manufacturing equipment for small to medium-sized equipment, 5 years; for large equipment, estimated by purchasing department at time of acceptance Furniture and fixtures 5 years Transportation equipment 4 to 5 years Electronic equipment 3 to 5 years Leasehold improvements remaining lease term for improvements on leased fixed assets or, for large improvements, estimated useful life; not less than 3 years for non-fixed asset repairs Expenditures for maintenance and repairs that neither materially add to the value of the property nor appreciably prolong the life of the property are charged to expense as incurred. Upon retirement or sale of an asset, the cost of the asset and the related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is credited or charged to income. Intangible Assets, Net Intangible assets consist of software used for finance, manufacturing, and research and development purposes. Assets are valued at cost at the time of acquisition and are amortized over their beneficial periods. If a contract specifies a beneficial period, then the intangible asset is amortized over a term not exceeding the beneficial period. If the contract does not specify a beneficial period, then the intangible asset is amortized over a term not exceeding the valid period specified by local law. If neither the contract nor local law specifies a beneficial period, then the intangible asset is amortized over a period of up to 10 years. Currently, the software that the Company uses is amortized over a two-year period in accordance with the policy described above. Investments The Company uses the equity method of accounting for its investment in, and earning or loss of, companies that it does not control but over which it does exert significant influence. The Company considers whether the fair value of its equity method investment has declined below its carrying value whenever adverse events or changes in circumstances indicate that recorded value may not be recoverable. The Company reviews its investments for other-than-temporary impairment whenever events or changes in business circumstances indicate that the carrying value of the investment may not be fully recoverable. Investments identified as having an indication of impairment are subject to further analysis to determine if the impairment is other-than-temporary and this analysis requires estimating the fair value of the investment. The determination of fair value of the investment involves considering factors such as current economic and market conditions, the operating performance of the entities including current earnings trends and forecasted cash flows, and other company and industry specific information. If the Company considers any decline to be other than temporary (based on various factors, including historical financial results and the overall health of the investee), then a write-down would be recorded to estimated fair value. See note 10 for discussion of equity method investment. Valuation of Long-Lived Assets Long-lived assets are evaluated for impairment whenever events or changes in circumstance indicate that the carrying value of the assets may not be fully recoverable or that the useful life of the assets is shorter than the Company had originally estimated. When these events or changes occur, the Company evaluates the impairment of the long-lived assets by comparing the carrying value of the assets to an estimate of future undiscounted cash flows expected to be generated from the use of the assets and their eventual disposition. If the sum of the expected future undiscounted cash flow is less than the carrying value of the assets, the Company recognizes an impairment loss based on the excess of the carrying value over the fair value. No impairment charge was recognized for either of the periods presented. Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities and operating lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. It uses the implicit rate when readily determinable. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Redeemable Convertible Preferred Stock The Company recorded each series of convertible preferred stock at fair value on the date of issuance, net of issuance costs. The convertible preferred stock is recorded outside of stockholders’ equity (deficit) because, in the event of certain deemed liquidation events considered not solely within the Company’s control (such as a merger, acquisition, or sale of all or substantially all of the Company’s assets), the convertible preferred stock will become redeemable at the option of the holders. The Company has not adjusted the carrying value of any series of convertible preferred stock to the liquidation preference of such series because it is uncertain whether or when an event would occur that would obligate the Company to pay the liquidation preferences to holders of convertible preferred stock. Subsequent adjustments to the carrying values to the liquidation preferences will be made only when it becomes probable that such a liquidation event will occur. Redeemable Non-controlling Interests The Company recorded initial carrying amount of redeemable non-controlling interests at fair value on the date of issuance, and presented in temporary equity on the consolidated balance sheets. As the non-controlling interests would be redeemable at a fixed purchase price, it is classified as common-share non-controlling interests redeemable at other than fair value. The Company applied the entire adjustment method (income classification) for subsequent measurement in accordance with ASC 480‑10-S99. Revenue Recognition The Company derives revenue principally from the sale of single-wafer wet cleaning equipment. Revenue from contracts with customers is recognized using the following five steps pursuant ASC Topic 606, Revenue from Contracts with Customers 1. Identify the contract(s) with a customer; 2. Identify the performance obligations in the contract; 3. Determine the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue when (or as) the entity satisfies a performance obligation. A contract contains a promise (or promises) to transfer goods or services to a customer. A performance obligation is a promise (or a group of promises) that is distinct. The transaction price is the amount of consideration a company expects to be entitled from a customer in exchange for providing the goods or services. The unit of account for revenue recognition is a performance obligation (a good or service). A contract may contain one or more performance obligations. Performance obligations are accounted for separately if they are distinct. A good or service is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and the good or service is distinct in the context of the contract. Otherwise performance obligations are combined with other promised goods or services until the Company identifies a bundle of goods or services that is distinct. Promises in contracts which do not result in the transfer of a good or service are not performance obligations, as well as those promises that are administrative in nature, or are immaterial in the context of the contract. The Company has addressed whether various goods and services promised to the customer represent distinct performance obligations. The Company applied the guidance of ASC Topic 606-10-25-16 through 18 in order to verify which promises should be assessed for classification as distinct performance obligations. The Company’s contracts with customers include more than one performance obligation. For example, the delivery of a piece of equipment generally includes the promise to install the equipment in the customer’s facility. The Company’s performance obligations in connection with a sale of equipment generally include production, delivery and installation, together with the provision of a warranty. The transaction price is allocated to all the separate performance obligations in an arrangement. It reflects the amount of consideration to which the Company expects to be entitled in exchange for transferring goods or services, which may include an estimate of variable consideration to the extent that it is probable of not being subject to significant reversals in the future based on the Company’s experience with similar arrangements. The transaction price excludes amounts collected on behalf of third parties, such as sales taxes. This is done on a relative selling price basis using standalone selling prices (“SSP”). The SSP represents the price at which the Company would sell that good or service on a standalone basis at the inception of the contract. Given the requirement for establishing SSP for all performance obligations, if the SSP is directly observable through standalone sales, then such sales should be considered in the establishment of the SSP for the performance obligation. The Company does not have observable SSPs for most performance obligations as the obligations are not regularly sold on a standalone basis. Production, delivery and installation of a product, together with provision of a warranty, are a single unit of accounting. Revenue is recognized when the Company satisfies each performance obligation by transferring control of the promised goods or services to the customer. Goods or services can transfer at a point in time (upon the acceptance of the products or upon the arrival at the destination as stipulated in the shipment terms) in a sale arrangement. In general, the Company recognizes revenue when a tool has been demonstrated to meet the customer’s predetermined specifications and is accepted by the customer. If terms of the sale provide for a lapsing customer acceptance period, the Company recognizes revenue as of the earlier of the expiration of the lapsing acceptance period and customer acceptance. In the following circumstances, however, the Company recognizes revenue upon shipment or delivery, when legal title to the tool is passed to a customer as follows: ● When the customer has previously accepted the same tool with the same specifications and the Company can objectively demonstrate that the tool meets all of the required acceptance criteria; ● When the sales contract or purchase order contains no acceptance agreement or lapsing acceptance provision and the Company can objectively demonstrate that the tool meets all of the required acceptance criteria; ● When the customer withholds acceptance due to issues unrelated to product performance, in which case revenue is recognized when the system is performing as intended and meets predetermined specifications; or ● When the Company’s sales arrangements do not include a general right of return. The Company offers post-warranty period services, which consist principally of the installation and replacement of parts and small-scale modifications to the equipment. The related revenue and costs of revenue are recognized when parts have been delivered and installed, risk of loss has passed to the customer, and collection is probable. The Company does not expect revenue from extended maintenance service contracts to represent a material portion of its revenue in the future. The Company incurs costs related to the acquisition of its contracts with customers in the form of sales commissions. Sales commissions are paid to third party representatives and distributors. Contractual agreements with these parties outline commission structures and rates to be paid. Generally speaking, the contracts are all individual procurement decisions by the customers and are not for significant periods of time, nor do they include renewal provisions. As such, all contracts have an economic life of significantly less than a year. Accordingly, the Company expenses sales commissions when incurred. These costs are recorded within sales and marketing expenses. The Company does not incur any costs to fulfill the contracts with customers that are not already reported in compliance with another applicable standard (for example, inventory or plant, property and equipment). Cost of Revenue Cost of revenue primarily consists of: direct materials, comprised principally of parts used in assembling equipment, together with crating and shipping costs; direct labor, including salaries and other labor related expenses attributable to the Company’s manufacturing department; and allocated overhead cost, such as personnel cost, depreciation expense, and allocated administrative costs associated with supply chain management and quality assurance activities, as well as shipping insurance premiums. Research and Development Costs Research and development costs relating to the development of new products and processes, including significant improvements and refinements to existing products or to the process of supporting customer evaluations of tools, including the development of new tools for evaluation by customers during the product demonstration process, are expensed as incurred. Shipping and Handling Costs Shipping and handling costs, which relate to transportation of products to customer locations, are charged to selling and marketing expense. For the year ended December 31, 2019 and 2018, shipping and handling costs included in sales and marketing expenses were $172 and $146 respectively. Borrowing Costs Borrowing costs attributable directly to the acquisition, construction or production of qualifying assets that require a substantial period of time to be ready for their intended use or sale are capitalized as part of the cost of those assets. Income earned on temporary investments of specific borrowings pending their expenditure on those assets is deducted from borrowing costs capitalized. All other borrowing costs are recognized in interest expenses in the consolidated statements of operations and comprehensive income in the period in which they are incurred. No borrowing costs were capitalized for the year ended December 31, 2019 or 2018. Warranty For each of its products, the Company generally provides a standard warranty ranging from 12 to 36 months and covering replacement of the product during the warranty period. The Company accounts for the estimated warranty costs as sales and marketing expenses at the time revenue is recognized. Warranty obligations are affected by historical failure rates and associated replacement costs. Utilizing historical warranty cost records, the Company calculates a rate of warranty expenses to revenue to determine the estimated warranty charge. The Company updates these estimated charges on a regular basis. Warranty obligations are included in other payables and accrued expenses in the consolidated balance sheets. Year Ended December 31, 2019 2018 Balance at beginning of period $ 1,710 $ 839 Additions 2,105 1,412 Utilized (1,004 ) (541 ) Balance at end of period $ 2,811 $ 1,710 Government Subsidies ACM Shanghai has been awarded four subsidies from local and central governmental authorities in the PRC. The first subsidy, which was awarded in October 2008, relates to the development and commercialization of 65 to 45nm Stress Free Polishing technology. The second subsidy was awarded in April 2009 to fund interest expenses for short-term borrowings. The third subsidy was awarded in January 2014 and relates to the development of Electro Copper Plating technology. The fourth subsidy was awarded in June of 2018, and related to development of Polytetrafluoroethylene. The PRC governmental authorities will provide the majority of the funding, although ACM Shanghai is also required to invest certain amounts in the projects. The government subsidies contain certain operating conditions and therefore are recorded as long-term liabilities upon receipt. The grant amounts are recognized in the statements of operations and comprehensive income: ● Government subsidies relating to current expenses are recorded as reductions of those expenses in the periods in which the current expenses are recorded. For the years ended December 31, 2019 and 2018, related government subsidies recognized as reductions of relevant expenses in the consolidated statements of operations and comprehensive income were $3,195 and $1,486, respectively. ● Government subsidies related to depreciable assets are credited to income over the useful lives of the related assets for which the grant was received. For the years ended December 31, 2019 and 2018, related government subsidies recognized as other income in the consolidated statements of operations and comprehensive income were $147 and $144, respectively. Unearned government subsidies received are deferred for recognition and recorded as other long-term liabilities (note 9) in the balance sheet until the criteria for such recognition are satisfied. Stock-based Compensation ACM grants stock options to employees and non-employee consultants and directors and accounts for those stock-based awards in accordance with FASB ASC Topic 718, Compensation – Stock Compensation. Stock-based awards granted to employees and non-employee consultants and directors are measured at the fair value of the awards on the grant date and are recognized as expenses either (a) immediately on grant, if no vesting conditions are required or (b) using the graded vesting method, net of estimated forfeitures, over the requisite service period. The fair value of stock options is determined using the Black-Scholes valuation model. Stock-based compensation expense, when recognized, is charged to the category of operating expense corresponding to the service function of the employees and non-employee consultants and directors. Income Taxes The Company accounts for income taxes using the liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable values. In evaluating the ability to recover its deferred income tax assets, the Company considers all available positive and negative evidence, including its operating results, ongoing tax planning and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis. In the event the Company determines that it would be able to realize its deferred income tax assets in the future in excess of their net recorded amount, it would make an adjustment to the valuation allowance that would reduce the provision for income taxes. Conversely, in the event that all or part of the net deferred tax assets are determined not to be realizable in the future, an adjustment to the valuation allowance would be charged to earnings in the period such determination is made. Tax benefits related to uncertain tax positions are recognized when it is more likely than not that a tax position will be sustained during an audit. Interest and penalties related to unrecognized tax benefits are included within the provision for income tax. Basic and Diluted Net Income per Common Share Basic and diluted net income per common share are calculated as follows: Year Ended December 31, 2019 2018 Numerator: Net income $ 19,458 $ 6,574 Net income attributable to redeemable non-controlling interest 564 - Net income available to common stockholders, basic and diluted $ 18,894 $ 6,574 Weighted average shares outstanding, basic 16,800,623 15,788,460 Effect of dilutive securities 2,334,874 2,123,645 Weighted average shares outstanding, diluted 19,135,497 17,912,105 Net income per common share: Basic $ 1.12 $ 0.42 Diluted $ 0.99 $ 0.37 Basic and diluted net income per common share are presented using the two-class method, which allocates undistributed earnings to common stock and any participating securities according to dividend rights and participation rights on a proportionate basis. Under the two-class method, basic net income (per common share is computed by dividing the sum of distributed and undistributed earnings attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Shares of ACM’s Series A, B, C, D, E and F convertible preferred stock are participating securities, as the holders are entitled to participate in and receive the same dividends as may be declared for common stockholders on a pro-rata, if-converted basis. ACM has been authorized to issue Class A and Class B common stock since redomesticating in Delaware in November 2016. The two classes of common stock are substantially identical in all material respects, except for voting rights. Since ACM did not declare any dividends during the years ended December 31, 2019 and 2018, the net income (loss) per common share attributable to each class is the same under the “two-class” method. As such, the two classes of common stock have been presented on a combined basis in the consolidated statements of operations and comprehensive income and in the above computation of net income per common share. Diluted net income per common share reflects the potential dilution from securities that could share in ACM’s earnings. Certain potential dilutive securities were excluded from the net income per share calculation because the impact would be anti-dilutive. The potentially dilutive securities that were not included in the calculation of diluted net income per share in the periods presented where their inclusion would be anti-dilutive are as follows: Year Ended December 31, 2019 2018 Stock Options 4,095,676 3,715,779 Warrant 77,810 80,000 4,173,486 3,795,779 Comprehensive Income Attributable to the Company The Company applies FASB ASC Topic 220, Comprehensive Income, which establishes standards for the reporting and display of comprehensive income or loss, requiring its components to be reported in a financial statement with the same prominence as other financial statements. The comprehensive income attributable to the Company was $18,559 and $5,595 for the years ended December 31, 2019 and 2018, respectively. Statutory reserves The income of ACM’s PRC subsidiaries is distributable to their shareholders after transfers to reserves as required under relevant PRC laws and regulations and the subsidiaries’ Articles of Association. As stipulated by the relevant laws and regulations in the PRC, the PRC subsidiaries are required to maintain reserves, including reserves for statutory surpluses and public welfare funds that are not distributable to shareholders. A PRC subsidiary’s appropriations to the reserves are approved by its board of directors. At least 10% of annual statutory after-tax profits, as determined in accordance with PRC accounting standards and regulations, is required to be allocated to the statutory surplus reserves. If the cumulative total of the statutory surplus reserves reaches 50% of a PRC subsidiary’s registered capital, any further appropriation is optional. Statutory surplus reserves may be used to offset accumulated losses or to increase the registered capital of a PRC subsidiary, subject to approval from the relevant PRC authorities, and are not available for dividend distribution to the subsidiary’s shareholders. The PRC subsidiaries are prohibited from distributing dividends unless any losses from prior years have been offset. Except for offsetting prior years’ losses, however, statutory surplus reserves must be maintained at a minimum of 25% of share capital after such usage. ACM Shanghai estimated a statutory surplus reserve of $1,427 based on an accumulated profit as of December 31, 2019 which is included in the accumulated surplus in the consolidated balance sheets, versus no statutory surplus reserved due to accumulated losses as of December 31, 2018. Fair Value of Financial Instruments Under the FASB’s authoritative guidance on fair value measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining the fair value, the Company uses various methods including market, income and cost approaches. Based on these approaches, the Company often utilizes certain assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable inputs. The Company uses valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Based on observability of the inputs used in the valuation techniques, the Company is required to provide the following information according to the fair value hierarchy. The fair value hierarchy ranks the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: Level 1: Valuations for assets and liabilities traded in active exchange markets. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities. Level 2: Valuations for assets and liabilities traded in less active dealer or broker markets. Valuations are obtained from third party pricing services for identical or similar assets or liabilities. Level 3: Valuations for assets and liabilities that are derived from other valuation methodologies, including option pricing models, discounted cash flow models and similar techniques, and not based on market exchange, dealer or broker traded transactions. Level 3 valuations incorporate certain unobservable assumptions and projections in determining the |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2019 | |
ACCOUNTS RECEIVABLE [Abstract] | |
ACCOUNTS RECEIVABLE | NOTE 3 – ACCOUNTS RECEIVABLE At December 31, 2019 and 2018, accounts receivable consisted of the following: December 31, 2019 2018 Accounts receivable $ 31,091 $ 24,608 Less: Allowance for doubtful accounts - - Total $ 31,091 $ 24,608 The Company reviews accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual balances. No allowance for doubtful accounts was considered necessary at December 31, 2019 and 2018. At December 31, 2019 and 2018, accounts receivable of $1,433 and $1,457 respectively, were pledged as collateral for borrowings from financial institutions (note 6). |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2019 | |
INVENTORIES [Abstract] | |
INVENTORIES | NOTE 4 – INVENTORIES At December 31, 2019 and 2018, inventory consisted of the following: December 31, 2019 2018 Raw materials $ 15,105 $ 12,646 Work in process 10,407 9,631 Finished goods 19,284 16,487 Total inventory, gross 44,796 38,764 Inventory reserve - - Total inventory, net $ 44,796 $ 38,764 At December 31, 2019 and 2018, the Company did not have an inventory reserve and no inventory was pledged as collateral for borrowings from financial institutions. System shipments of first-tools to an existing or prospective customer, for which ownership does not transfer until customer acceptance, are classified as finished goods inventory and carried at cost until ownership is transferred. |
PROPERTY, PLANT AND EQUIPMENT,
PROPERTY, PLANT AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2019 | |
PROPERTY, PLANT AND EQUIPMENT, NET [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT, NET | NOTE 5 – PROPERTY, PLANT AND EQUIPMENT, NET At December 31, 2019 and 2018, property, plant and equipment consisted of the following: December 31, 2019 2018 Manufacturing equipment $ 3,902 $ 9,703 Office equipment 627 512 Transportation equipment 124 184 Leasehold improvement 1,442 1,379 Total cost 6,095 11,778 Less: Total accumulated depreciation (3,077 ) (8,102 ) Construction in progress 601 32 Total property, plant and equipment, net $ 3,619 $ 3,708 Depreciation expense was $713 and $350 for the years ended December 31, 2019 and 2018, respectively. During the year ended December 31, 2019, the Company retired certain fully depreciated manufacturing equipment with cost of $5,824. |
SHORT-TERM BORROWINGS
SHORT-TERM BORROWINGS | 12 Months Ended |
Dec. 31, 2019 | |
SHORT-TERM BORROWINGS [Abstract] | |
SHORT-TERM BORROWINGS | NOTE 6 – SHORT-TERM BORROWINGS At December 31, 2019 and 2018, short-term borrowings consisted of the following: December 31, 2019 2018 Line of credit up to RMB 50,000 from Bank of Shanghai Pudong Branch, due on April 17,2019 with an annual interest rate of 4.99%, guaranteed by the Company’s CEO and fully repaid on March 27, 2019. $ - $ 3,133 Line of credit up to RMB 50,000 from Bank of Shanghai Pudong Branch, due on February 14,2019 with an annual interest rate of 5.15%, guaranteed by the Company’s CEO and fully repaid on February 14, 2019. 485 Line of credit up to RMB 50,000 from Bank of Shanghai Pudong Branch, due on January 23, 2020 with an annual interest rate of 5.22%, guaranteed by the Company’s CEO and Cleanchip Technologies Limited.Only RMB 14,500 was repaid on December 13,2019. 5,057 Line of credit up to RMB 30,000 from Bank of China Pudong Branch, due on June 6,2019 with annual interest rate of 5.22%,secured by certain of the Company’s intellectual property and the Company’s CEO and fully repaid on June 6,2019. 2,186 Line of credit up to RMB 30,000 from Bank of China Pudong Branch, due on June 13,2019 with annual interest rate of 5.22%,secured by certain of the Company’s intellectual property and the Company’s CEO and fully repaid on June 13,2019. 2,186 Line of credit up to RMB 10,000 from Shanghai Rural Commercial Bank, due on January 23, 2019 with an annual interest rate of 5.44%, guaranteed by the Company’s CEO and pledged by accounts receivable,and fully repaid on January 23, 2019. 1,457 Line of credit up to RMB 20,000 from Shanghai Rural Commercial Bank, due on February 21, 2020 with an annual interest rate of 5.66%, guaranteed by the Company’s CEO and pledged by accounts receivable. 1,433 Line of credit up to RMB 20,000 from Bank of Communications, due on January 18, 2020 with an annual interest rate of 5.66%. 1,433 Line of credit up to RMB 20,000 from Bank of Communications, due on January 22, 2020 with an annual interest rate of 5.66%. 717 Line of credit up to RMB 20,000 from Bank of Communications, due on February 14, 2020 with an annual interest rate of 5.66%. 717 Line of credit up to RMB 50,000 from China Everbright Bank, due on March 25, 2020 with an annual interest rate of 4.94%, guaranteed by the Company’s CEO. 3,250 Line of credit up to RMB 50,000 from China Everbright Bank, due on April 17, 2020 with an annual interest rate of 5.66%, guaranteed by the Company’s CEO. 1,146 Total $ 13,753 $ 9,447 For the years ended December 31, 2019 and 2018, interest expense related to short-term borrowings amounted to $745 and $498, respectively. |
OTHER PAYABLE AND ACCRUED EXPEN
OTHER PAYABLE AND ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2019 | |
OTHER PAYABLE AND ACCRUED EXPENSES [Abstract] | |
OTHER PAYABLE AND ACCRUED EXPENSES | NOTE 7 – OTHER PAYABLE AND ACCRUED EXPENSES At December 31, 2019 and 2018, other payable and accrued expenses consisted of the following: December 31, 2019 2018 Lease expenses and payable for leasehold improvement due to a related party (note 11) $ - $ 53 Accrued commissions 4,082 2,931 Accrued warranty 2,811 1,710 Accrued payroll 2,092 626 Accrued professional fees 165 64 Accrued machine testing fees 1,456 3,076 Others 2,268 1,950 Total $ 12,874 $ 10,410 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2019 | |
LEASES [Abstract] | |
LEASES | NOTE 8 – LEASES ACM entered into a two-year lease agreement in March 2015 for office and warehouse space of approximately 3,000 square feet for its headquarters in Fremont, California, at a rate of $2 per month. On February 4, 2019, ACM amended the lease agreement to extend the lease term through March 31, 2020 and increase the base rent to $3.3 per month from April 1, 2019 to March 31, 2020 and $3.4 per month from April 1, 2020 to March 31, 2021. ACM Shanghai entered into an operating lease agreement with Zhangjiang Group (a related party, see note 11) in 2007 for manufacturing and office space of approximately 63,510 square feet in Shanghai, China. The lease terms and its payment terms are subject to modification and extension with Zhangjiang Group from time to time. The lease with Zhangjiang Group expired on December 31, 2017 and from January 1, 2018 to April 25, 2018 ACM Shanghai leased the property on a month-to-month basis. On April 26, 2018, ACM Shanghai entered into a renewed lease with Zhangjiang Group for the period from January 1, 2018 through December 31, 2022. Under the lease, ACM Shanghai would pay a monthly rental fee of RMB 366 (equivalent to $55). The required security deposit is RMB 1,077 (equivalent to $163). ACM Wuxi leases office space in Wuxi, China, at a rate of less than $1 per month. In January 2018, ACM Shanghai entered into an operating lease agreement for a second factory in the Pudong region of Shanghai from January 2018 to January 2023. This facility has a total of 50,000 square feet of available floor space. The monthly rent varies during the term of the lease. The Company leases space under non-cancelable operating leases for several office and manufacturing locations. These leases do not have significant rent escalation holidays, concessions, leasehold improvement incentives, or other build-out clauses. Further, the leases do not contain contingent rent provisions. Most leases include one or more options to renew. The exercise of lease renewal options is typically at the Company’s sole discretion; therefore, the majority of renewals to extend the lease terms are not included in the Company’s right-of-use assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates the renewal options, and when they are reasonably certain of exercise, the Company includes the renewal period in its lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. The Company has a centrally managed treasury function; therefore, based on the applicable lease terms and the current economic environment, it applies a portfolio approach for determining the incremental borrowing rate. The components of lease expense were as follows: Year Ended December 31, 2019 Operating lease cost $ 1,432 Short-term lease cost 165 Lease cost $ 1,597 Supplemental cash flow information related to operating leases was as follows for the period ended December 31, 2019: Year Ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflow from operating leases $ 1,597 Maturities of lease liabilities for all operating leases were as follows as of December 31, 2019: December 31, 2020 $ 1,504 2021 1,488 2022 1,496 2023 53 2024 13 Total lease payments 4,554 Less: Interest (667 ) Present value of lease liabilities $ 3,887 The weighted average remaining lease terms and discount rates for all operating leases were as follows as of December 31 2019: December 31, 2019 Remaining lease term and discount rate: Weighted average remaining lease term (years) 3.02 Weighted average discount rate 5.43 % |
OTHER LONG-TERM LIABILITIES
OTHER LONG-TERM LIABILITIES | 12 Months Ended |
Dec. 31, 2019 | |
OTHER LONG-TERM LIABILITIES [Abstract] | |
OTHER LONG-TERM LIABILITIES | NOTE 9– OTHER LONG-TERM LIABILITIES Other long-term liabilities represent government subsidies received from PRC governmental authorities for development and commercialization of certain technology but not yet recognized (note 2). As of December 31, 2019 and 2018, other long-term liabilities consisted of the following unearned government subsidies: December 31, 2019 2018 Subsidies to Stress Free Polishing project, commenced in 2008 and 2017 $ 1,251 $ 1,483 Subsidies to Electro Copper Plating project, commenced in 2014 2,666 2,860 Subsidies to Polytetrafluoroethylene project, commenced in 2018 135 178 Other 134 62 Total $ 4,186 $ 4,583 |
LONG-TERM INVESTMENT
LONG-TERM INVESTMENT | 12 Months Ended |
Dec. 31, 2019 | |
LONG-TERM INVESTMENT [Abstract] | |
LONG-TERM INVESTMENT | NOTE 10 – LONG-TERM INVESTMENT On September 6, 2017, ACM and Ninebell Co., Ltd. (“Ninebell”), a Korean company that is one of the Company’s principal material suppliers, entered into an ordinary share purchase agreement, effective as of September 11, 2017, pursuant to which Ninebell issued to ACM ordinary shares representing 20% of Ninebell’s post-closing equity for a purchase price of $1,200, and a common stock purchase agreement, effective as of September 11, 2017, pursuant to which ACM issued 133,334 shares of Class A common stock to Ninebell for a purchase price of $1,000 at $7.50 per share. The investment in Ninebell is accounted for under the equity method. On June 27, 2019, ACM Shanghai and Shengyi Semiconductor Technology Co., Ltd. (“Shengyi”), a company based in Wuxi, China that is one of the Company’s component suppliers, entered into an agreement pursuant to which Shengyi issued to ACM Shanghai shares representing 15% of Shengyi’s post-closing equity for a purchase price of $109. The investment in Shengyi is accounted for under the cost method. On September 5, 2019, ACM Shanghai, entered into a Partnership Agreement with six other investors, as limited partners, and Beijing Shixi Qingliu Investment Co., Ltd., as general partner and manager, with respect to the formation of Hefei Shixi Chanheng Integrated Circuit Industry Venture Capital Fund Partnership (LP), a Chinese limited partnership based in Hefei, China. Pursuant to such Partnership Agreement, on September 30, 2019, ACM Shanghai invested RMB 30,000 ($4,200), which represented 10% of the Partnership’s total subscribed capital. The investment in Hefei Shixi Chanheng Integrated Circuit Industry Venture Capital Fund Partnership (LP) is accounted for under the equity method in accordance with ASC 323-30-S99-1. The Company treats the equity investment in the consolidated financial statements under the equity method. Under the equity method, the investment is initially recorded at cost, adjusted for any excess of the Company’s share of the incorporated-date fair values of the investee’s identifiable net assets over the cost of the investment (if any). Thereafter, the investment is adjusted for the post incorporation change in the Company’s share of the investee’s net assets and any impairment loss relating to the investment. For the years ended December 31, 2019 and 2018 the Company’s share of equity investees’ net income was $168 and $123, respectively, which was included in income on equity method investment in the accompanying consolidated statements of operations and comprehensive income. December 31, 2019 2018 Investment – equity method $ 5,827 $ 1,360 Investment – cost method 107 - Total $ 5,934 $ 1,360 |
RELATED PARTY BALANCES AND TRAN
RELATED PARTY BALANCES AND TRANSACTIONS | 12 Months Ended |
Dec. 31, 2019 | |
RELATED PARTY BALANCES AND TRANSACTIONS [Abstract] | |
RELATED PARTY BALANCES AND TRANSACTIONS | NOTE 11 – RELATED PARTY BALANCES AND TRANSACTIONS On August 18, 2017, ACM and Ninebell, its equity method investment affiliate (note 10), entered into a loan agreement pursuant to which ACM made an interest-free loan of $946 to Ninebell, payable in 180 days or automatically extended another 180 days if in default. The loan was secured by a pledge of Ninebell’s accounts receivable due from ACM and all money that Ninebell received from ACM. Ninebell repaid the loan in March 2018. ACM purchased materials from Ninebell amounting to $8,572 and $7,785 during the years ended December 31, 2019 and 2018, respectively. As of December 31, 2019 and 2018, accounts payable due to Ninebell were $727 and $1,477, respectively, and prepaid to Ninebell for material purchases were $348 and $572, respectively. ACM purchased materials from Shengyi amounting to $856 during the year ended December 31, 2019. As of December 31, 2019, accounts payable due to Shengyi was $488. In 2007 ACM Shanghai entered into an operating lease agreement with Shanghai Zhangjiang Group Co., Ltd. (“Zhangjiang Group”) to lease manufacturing and office space located in Shanghai, China. An affiliate of Zhangjiang Group holds 787,098 shares of Class A common stock that it acquired in September 2017 for $5,903. Pursuant to the lease agreement, Zhangjiang Group provided $771 to ACM Shanghai for leasehold improvements. In September 2016 the lease agreement was amended to modify payment terms and extend the lease through December 31, 2017. From January 1 to April 25, 2018, ACM Shanghai leased the property on a month-to-month basis. On April 26, 2018, ACM Shanghai entered into a renewed lease with Zhangjiang Group for the period from January 1, 2018 through December 31, 2022. Under the lease, ACM Shanghai would pay a monthly rental fee of approximately RMB 366 (equivalent to $55). The required security deposit is RMB 1,077 (equivalent to $163). The Company incurred leasing expenses under the lease agreement of $595 and $620 during the years ended December 31, 2019 and 2018, respectively. As of December 31, 2019 and 2018, payables to Zhangjiang Group for lease expenses and leasehold improvements recorded as other payables and accrued expenses amounted to $0 and $53, respectively (note 7). On December 9, 2016, Shengxin (Shanghai) Management Consulting Limited Partnership (“SMC”), a PRC limited partnership owned by employees of ACM Shanghai, including Jian Wang, the Chief Executive Officer and President of ACM Shanghai and the brother of David H. Wang (a related party, see note 11), delivered RMB 20,124 ($2,981 as of the close of business on such date) in cash (the “SMC Investment”) to ACM Shanghai for potential investment pursuant to terms to be subsequently negotiated. On March 14, 2017, ACM, ACM Shanghai and SMC entered into a securities purchase agreement (the “SMC Agreement”) pursuant to which, in exchange for the SMC Investment, (a) ACM issued to SMC a warrant (the “SMC Warrant”) exercisable, for cash or on a cashless basis, to purchase, at any time on or before May 17, 2023, all, but not less than all, of 397,502 shares of Class A common stock at a price of $7.50 per share, for a total exercise price of $2,981 and (b) ACM Shanghai agreed to repay the SMC Investment within 60 days after exercise of the SMC Warrant. On March 30, 2018, SMC exercised the SMC Warrant in full and purchased 397,502 shares of Class A common stock (note 12). SMC borrowed the funds to pay the SMC Warrant exercise price pursuant to a senior secured promissory note in the principal amount of $2,981 issued to the Company. The note bears interest at a rate of 3.01% per annum and matures on August 17, 2023 and is secured by a pledge of the shares issued upon exercise of the SMC Warrant. As described in the following paragraph, in the third quarter of 2019 ACM repurchased a total of 154,821 of the SMC Warrant shares from SMC at a per share price of $13.195, of which (a) $1,161 was applied to reduce SMC’s obligations to ACM Shanghai under the SMC Note and the remaining $882 was paid to SMC. In a separate transaction in August, 2019, ACM Shanghai repaid $1,161 of the SMC Investment in cash. On August 14, 2019, ACM entered into an equity purchase agreement (the “Equity Purchase Agreement”) under which it agreed to repurchase, at a price per share of $13.195 (the net proceeds per share ACM received in a public offering of Class A common stock, as described in note 12), shares of Class A common stock from certain directors, employees and SMC upon the exercise of the underwriters’ over-allotment option in connection with the public offering in August 2019. The total consideration to the directors, employees and SMC, in exchange for their surrender of an aggregate of 214,286 shares of Class A common stock and cancellation of options to acquire 53,571 shares of Class A common stock (note 14) amounted to a total of $3,403, which was based at a price of $13.195 per share equal to the net proceeds per share ACM received from the over-allotment option in connection with the offering. |
COMMON STOCK
COMMON STOCK | 12 Months Ended |
Dec. 31, 2019 | |
COMMON STOCK [Abstract] | |
COMMON STOCK | NOTE 12 – COMMON STOCK ACM is authorized to issue 50,000,000 shares of Class A common stock and 2,409,738 shares of Class B common stock, each with a par value of $0.0001. Each share of Class A common stock is entitled to one vote, and each share of Class B common stock is entitled to twenty votes and is convertible at any time into one share of Class A common stock. Shares of Class A common stock and Class B common stock are treated equally, identically and ratably with respect to any dividends declared by the Board of Directors unless the Board of Directors declares different dividends to the Class A common stock and Class B common stock by getting approval from a majority of common stock holders. On March 30, 2018, SMC exercised the SMC Warrant in full (note 11) to purchase 397,502 shares of Class A common stock. During the year ended December 31, 2019, ACM issued 195,297 shares of Class A common stock upon option exercises by employees and non-employees and an additional 35,815 shares of Class A common stock upon conversion of an equal number of shares of Class B common stock. During the year ended December 31, 2018, the Company issued 265,952 shares of Class A common stock upon options exercises by certain employees and non-employees and an additional 511,315 shares of Class A common stock upon conversion of an equal number of shares of Class B common stock. In August 2019, ACM sold a total of 2,053,572 shares of Class A common stock to the public at a price of $14.00 per share for aggregate gross proceeds of $28,750. Net proceeds to ACM excluded an underwriting discount and offering expenses totaling $2,287. As described in note 11, ACM repurchased outstanding shares from certain directors, employees and SMC upon the exercise of the underwriters’ over-allotment option using a portion of ACM’s net proceeds from the public offering for the purpose of share constructive retirement. A total of 214,286 repurchased shares were accounted for share retirement during the year ended December 31, 2019. During the year ended December 31, 2019, ACM issued 1,438 shares of Class A common stock upon cashless warrant exercises by non-employees At December 31, 2019 and 2018, the number of shares of Class A common stock issued and outstanding was 16,182,151 and 14,110,315, respectively. At December 31, 2019 and 2018, the number of shares of Class B common stock issued and outstanding was 1,862,608 and 1,898,423, respectively. During the year ended December 31, 2019, 35,815 shares of Class B common stock were converted into Class A common stock in accordance with their terms. |
REDEEMABLE NON-CONTROLLING INTE
REDEEMABLE NON-CONTROLLING INTERESTS | 12 Months Ended |
Dec. 31, 2019 | |
REDEEMABLE NON-CONTROLLING INTERESTS [Abstract] | |
REDEEMABLE NON-CONTROLLING INTERESTS | NOTE 13 – REDEEMABLE NON-CONTROLLING INTERESTS As discussed in note 1, during the quarter ended September 30, 2019, ACM Shanghai issued to the First Tranche Investors equity in the form of redeemable non-controlling interests, representing 4.2% of the outstanding shares of ACM Shanghai. Two of the First Tranche Investors are entities owned by certain employees of ACM Shanghai (the “Employee Entities”), and the purchase price paid by the Employee Entities represented a discount of 20% from the purchase price paid by the other First Tranche Investors. The discount granted to the Employee Entities is classified as a stock-based compensation which is further discussed in note 14. In addition to the capital increase agreement with the First Tranche Investors, ACM Shanghai entered into a supplemental agreement (a “First Tranche Supplemental Agreement”) with each of the First Tranche Investors. Under each First Tranche Supplemental Agreement, ACM Shanghai and the First Tranche Investor party thereto agreed to use their respective best efforts to facilitate the completion of the Listing and the STAR IPO within three years from the date on which ACM Shanghai shares were issued to the First Tranche Investors. If, by the end of such three-year period, the Listing and the STAR IPO have not been completed and the China Securities Regulatory Commission has not otherwise approved the registration of ACM Shanghai’s Listing registration application, the First Tranche Investor and ACM Shanghai each will have the right to require that ACM Shanghai repurchase the First Tranche Investor’s shares for a price equal to the initial purchase price paid by the First Tranche Investor, without interest. The Supplemental Agreements will be automatically terminated on the date when ACM Shanghai formally submits the Listing registration application document to the Shanghai Stock Exchange. In the quarter ended December 31, 2019, ACM Shanghai issued to the Second Tranche Investors equity in the form of redeemable non-controlling interests. Following the issuance of shares to the Investors, 91.7% of the outstanding shares of ACM Shanghai were owned by ACM, 3.8% were owned by the First Tranche Investors, and 4.5% were owned by the Second Tranche Investors. In addition to the capital increase agreement with the Second Tranche Investors, ACM Shanghai entered into a supplemental agreement (a “Second Tranche Supplemental Agreement”) with each of the Second Tranche Investors. Under each Second Tranche Supplemental Agreement, if ACM Shanghai does not officially submit application documents for the Listing to the Shanghai Stock Exchange by December 31, 2022, each Second Tranche Investor will have the right to require that ACM Shanghai repurchase, and ACM Shanghai will have the right to require that each Second Tranche Investor sell to ACM Shanghai, such Second Tranche Investor’s ACM Shanghai shares for a price equal to the initial purchase price paid by the Second Tranche Investor, without interest. The Second Tranche Supplemental Agreements will be automatically terminated on the date when ACM Shanghai formally submits the Listing registration application document to the Shanghai Stock Exchange. Because the First Tranche Investors and the Second Tranche Investors have the right to require ACM Shanghai to repurchase their ownership interests in ACM Shanghai at a fixed purchase price, those ownership interests are classified as redeemable non-controlling interests u nder ASC 480 Distinguishing Liabilities From Equity The components of the change in the redeemable non-controlling interests for the year ended December 31, 2019 are presented in the following table: Balance at January 1, 2019 $ - Increase in redeemable non-controlling interests due to issuance of common stock Tranche 1: 27,264 Tranche 2: 32,415 Net income attributable to redeemable non-controlling interests 564 Effect of foreign currency translation loss attributable to redeemable non-controlling interests (81 ) Balance at December 31, 2019 $ 60,162 |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2019 | |
STOCK-BASED COMPENSATION [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 14 – STOCK-BASED COMPENSATION On April 29, 1998, ACM adopted the 1998 Stock Option Plan (the “1998 Plan”). The options issued under the Plan consisted of incentive stock options (“ISOs”) and nonstatutory stock options (“NSOs”) that should be determined at the time of grant. ISOs could be granted only to employees. NSOs could be granted to employees, directors and consultants. The option price of each ISO and each NSO could not be less than 100% or less than 85% of the fair market value of stock price at the time of grant, respectively. The vesting period was to be determined by the Board of Directors for each grant. The total number of shares of common stock reserved under the 1998 Plan, as amended, was 766,667. If any option granted under the 1998 Plan expires or otherwise terminates without having been exercised in full, the shares of common stock subject to that option would become available for re-grant. At March 3, 2014, the 1998 Plan terminated and no further grants under the 1998 Plan could be made thereunder, although certain previously granted options remained outstanding in accordance with their terms. On December 28, 2016, ACM adopted the 2016 Omnibus Incentive Plan (the “2016 Plan”). Under the 2016 Plan, the aggregate number of shares of Class A common stock that may be issued shall equal the sum of (a) 2,333,334 and (b) an annual increase on the first day of each year beginning in 2018 and ending in 2026 equal to the lesser of (i) 4% of the shares of Class A and Class B common stock outstanding (on an as-converted basis) on the last day of the immediately preceding year and (ii) such smaller number of shares as may be determined by the Board. A maximum of 2,333,334 shares is available for issuance as ISOs under the 2016 Plan. Besides the stock options, the 2016 Plan also authorizes issuance of stock appreciation rights, restricted stock, restricted stock units, and other share-based and cash awards. The 2016 Plan will terminate on December 27, 2026. Employee Awards The following table summarizes the Company’s employee share option activities during the years ended December 31, 2018 and December 31, 2019: Number of Weighted Weighted Average Exercise Weighed Average Remaining Contractual Term Outstanding at December 31, 2017 2,045,616 $ 0.66 $ 2.46 7.57 years Granted 745,700 1.52 8.12 Exercised (151,650 ) $ 0.53 $ 2.06 Expired (4,622 ) 0.55 3.00 Forfeited (131,639 ) $ 0.97 $ 3.87 Outstanding at December 31, 2018 2,503,405 0.91 4.09 7.30 years Granted 656,000 $ 6.29 $ 16.21 Exercised (106,768 ) 0.60 2.09 Expired (2,757 ) $ 3.34 $ 8.16 Forfeited/cancelled (55,817 ) 2.38 6.23 Outstanding at December 31, 2019 2,994,063 $ 2.59 $ 6.77 7.05 years Vested and exercisable at December 31, 2019 1,773,048 The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the estimated fair value of the underlying stock at each reporting date. In addition to the above share option activities, as mentioned in Note 13, the purchase price paid by the Employee Entities for ACM Shanghai shares was at a discount of 20% from the purchase price paid by the other investors, and there was no vesting condition attached to the subscription. Accordingly, the Company determined the discount as stock based compensation expenses, which amounted to $949, of which $119, $111, $625 and $94 included in costs of revenues, sales and marketing expenses, research and development expenses and general and administrative expenses, respectively, during the year ended December 31, 2019. During the years ended December 31, 2019 and 2018, ACM recognized employee stock-based compensation expense of $2,265 and $712, respectively. As of December 31, 2019 and 2018, $4,712 and $2,424, respectively, of total unrecognized employee stock-based compensation expense, net of estimated forfeitures, related to stock-based awards were expected to be recognized over a weighted-average period of 1.47 years and 1.62 years, respectively. Total unrecognized compensation cost may be adjusted for future changes in estimated forfeitures. The fair value of each option granted to employee is estimated on the grant date using the Black-Scholes valuation model with the following assumptions. December 31, 2019 2018 Fair value of common share(1) $ 13.64-16.81 $ 5.31-13.85 Expected term in years(2) 6.25 6.25 Volatility(3) 39.91%-40.35 % 39.14%-43.00 % Risk-free interest rate(4) 1.69%-2.46 % 2.55%-2.96 % Expected dividend(5) 0 % 0 % (1) Common stock value was the close market value on the grant date. (2) Expected term of share options is based on the average of the vesting period and the contractual term for each grant according to Staff Accounting Bulletin 110. (3) Volatility is calculated based on the historical volatility of ACM’s comparable companies in the period equal to the expected term of each grant. (4) Risk-free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of the share options in effect at the time of grant. (5) Expected dividend is assumed to be 0% as ACM has no history or expectation of paying a dividend on its common stock. Non-employee Awards The following table summarizes the Company’s non-employee share option activities during the year ended December 31, 2018 and 2019: Number of Weighted Weighted Weighted Average Outstanding at December 31, 2017 1,326,676 $ 0.78 2.52 7.54 years Granted - - - - Exercised (114,302 ) 0.43 1.92 - Expired - - - - Forfeited - - - - Outstanding at December 31, 2018 1,212,374 0.78 2.57 6.66 years Granted - - - - Exercised (88,529 ) 0.45 1.06 - Expired - - - - Forfeited/cancelled (22,232 ) 0.55 3.00 - Outstanding at December 31, 2019 1,101,613 0.82 2.69 5.85 years Vested and exercisable at December 31, 2019 1,024,017 The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the estimated fair value of the underlying stock at each reporting date. The Company adopted ASU 2018-07 on January 1, 2019, and the stock-based compensation expense for grants before the adoption of ASU 2018-07 is based on the grant date fair value as of December 31, 2018, which was the last business day before the Company adopted ASU 2018-07, for all nonemployee awards that have not vested as of December 31, 2018. The cumulative-effect adjustment to retained earnings as of January 1, 2019 was immaterial to the financial statements as a whole. Accordingly, the Company did not record this adjustment as of January 1, 2019. Furthermore, for future awards, compensation expense is based on the fair value of the shares at the grant date. During the years ended December 31, 2019 and 2018, the Company recognized non-employee stock-based compensation expense of $1,307 and $2,651, respectively. As of December 31, 2019 and 2018, $406 and $1,713, respectively, of total unrecognized non-employee stock-based compensation expense, net of estimated forfeitures, related to stock-based awards were expected to be recognized over a weighted-average period of 0.23 years and 1.31 years, respectively. Total recognized compensation cost may be adjusted for future changes in estimated forfeitures. Stock options to acquire 22,232 shares of Class A common stock held by a director were canceled pursuant to the Equity Purchase Agreement (note 11) during the year ended December 31, 2019. As of December 31, 2019, ACM had outstanding stock options to acquire an aggregate of 4,095,676 shares of Class A common stock with an intrinsic value of $52,300. Of those outstanding options, (a) 2,797,062 shares had vested as of December 31, 2019, representing an intrinsic value of $43,400 and (b) 1,298,614 shares were unvested, representing an intrinsic value of $8,900. As of December 31, 2018, ACM had outstanding stock options to acquire an aggregate of 3,715,779 shares of Class A common stock with an intrinsic value of $27,100. Of those outstanding options, (a) 2,273,880 shares had vested as of December 31, 2018, representing an intrinsic value of $20,000, and (b) 1,441,899 shares were unvested, representing an intrinsic value of $7,100. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2019 | |
INCOME TAXES [Abstract] | |
INCOME TAXES | NOTE 15 – INCOME TAXES The following represent components of the income tax benefit (expense) for the years ended December 31, 2019 and 2018: Year Ended December 31, 2019 2018 Current: U.S. federal $ - $ - U.S. state - - Foreign (3,176 ) (1,149 ) Total current tax expense (3,176 ) (1,149 ) Deferred: U.S. federal 3,728 - U.S. state - Foreign (34 ) 343 Total deferred tax benefit 3,694 343 Total income tax benefit (expense) $ 518 $ (806 ) Tax effects of temporary differences that give rise to significant portions of the Company’s deferred tax assets at December 31, 2019 and 2018 are presented below: Year Ended December 31, 2019 2018 Deferred tax assets: Net operating loss carry forwards (offshore) $ 216 $ 16 Net operating loss carry forwards (U.S.) and credit 3,218 4,105 Deferred revenue (offshore) 1,181 558 Accruals (U.S.) 15 11 Reserves and other (offshore) 426 1,080 Stock-based compensation (U.S.) 1,168 1,021 Property and equipment (U.S.) 3 1 Total gross deferred tax assets 6,227 6,792 Less: valuation allowance (896 ) (5,155 ) Total deferred tax assets 5,331 1,637 Total deferred tax liabilities - - Translation difference - - Deferred tax assets, net $ 5,331 $ 1,637 The Company considers all available evidence to determine whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become realizable. Management considers the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carry-forward periods), and projected taxable income in assessing the realizability of deferred tax assets. In making such judgments, significant weight is given to evidence that can be objectively verified. Based on all available evidence, a partial valuation allowance has been established against some net deferred tax assets as of December 31, 2019 and 2018, based on estimates of recoverability. While the Company has optimistic plans for its business strategy, it determined that such a valuation allowance was necessary given its historical losses and the uncertainty with respect to its ability to generate sufficient profits from its business model from all tax jurisdictions. In order to fully realize the U.S. deferred tax assets, the Company must generate sufficient taxable income in future periods before the expiration of the deferred tax assets governed by the tax code. The valuation allowance for the United States decreased by $4,465 for the year ended December 31, 2019 and decreased by $278 for the year ended December 31, 2018. The reduction of the U.S. valuation allowance resulted in a one-time tax benefit of $4,033 for the year ended December 31, 2019. The valuation allowance in China increased by $207 and increased by $2 during the years ended December 31, 2019 and 2018, respectively. The Company did not have any significant temporary differences relating to deferred tax liabilities as of December 31, 2019 or 2018. As of December 31, 2019 and 2018, the Company had net operating loss carry-forwards of $12,158 and $15,867 for U.S federal purposes, $634 and $714 for U.S. state purposes and $66 for Chinese income tax purposes , respectively. As of December 31, 2019 and 2018, the Company had research credit carry-forwards of respectively, $479 and $606 for U.S. federal purposes, and $377 and $377 for U.S. state purposes. Such credits are set to expire in 2025 for U.S. federal carry-forwards. There is no expiration date for U.S. state carry-forwards. A limitation applies to the use of the U.S. net operating loss and credit carry-forwards, under provisions of the U.S. Internal Revenue Code that would be applicable if ACM experiences an “ownership change,” as defined in IRC Section 382. ACM conducted an analysis of its stock ownership under Internal Revenue Code Section 382 and $12 of the net operating loss carryforwards are subject to annual limitation as a result of the ownership change in 2017. The net operating loss carryforwards are not expected to expire before utilization. The Company’s effective tax rate differs from statutory rates of 21% for U.S. federal income tax purposes and 15%-25% for Chinese income tax purpose due to the effects of the valuation allowance and certain permanent differences as it pertains to book-tax differences in the value of client shares received for services. Pursuant to the Corporate Income Tax Law of the PRC, all of the Company’s PRC subsidiaries are liable to PRC Corporate Income Taxes at a rate of 25% except for ACM Shanghai. According to Guoshuihan 2009 No. 203, if an entity is certified as an “advanced and new technology enterprise,” it is entitled to a preferential income tax rate of 15%. ACM Shanghai obtained the certificate of “advanced and new technology enterprise” in 2012, in 2016 and again in 2018 with an effective period of three years, and the provision for PRC corporate income tax for ACM Shanghai is calculated by applying the income tax rate of 15% for the years ended December 31, 2019 and 2018. Income tax expense for the years ended December 31, 2019 and 2018 differed from the amounts computed by applying the statutory federal income tax rate of 21% to pretax income (loss) as a result of the following: Year Ended December 31, 2019 2018 Effective tax rate reconciliation: Income tax provision at statutory rate 21.00 % 21.00 % Foreign rate differential (12.26 ) (20.88 ) Other permanent difference 8.71 15.59 Change in valuation allowance (20.19 ) (4.78 ) Total income tax expense (benefit) (2.74 %) 10.93 % Tax positions are evaluated in a two-step process. The Company first determines whether it is more likely than not that a tax position will be sustained upon examination. If a tax position meets the more-likely-than-not recognition threshold it is then measured to determine the amount of benefit to recognize in the financial statements. The tax position is measured as the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement. The aggregate changes in the balance of gross unrecognized tax benefits, which excludes interest and penalties, for the years ended December 31, 2019 and 2018, are as follows: Year Ended December 31, 2019 2018 Beginning balance $ 44 $ 44 Increase/ (decrease) of unecognized tax benefits taken in prior years - - Increase/ (decrease) of unecognized tax benefits related to current year - - Increase/ (decrease) of unrecognized tax benefits related to settlements - - Reductions to unrecognized tax benefits related to lapsing statute of limitations - - Ending balance $ 44 $ 44 The Company is subject to taxation in the United States, California and foreign jurisdictions. The federal, state and foreign income tax returns are under the statute of limitations subject to tax examinations for the tax years ended December 31, 2009 through December 31, 2019. To the extent the Company has tax attribute carry-forwards, the tax years in which the attribute was generated may still be adjusted upon examination by the U.S. Internal Revenue Service, state or foreign tax authorities to the extent utilized in a future period. The Company had $44 of unrecognized tax benefits as of December 31, 2019 and 2018. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2019 and 2018, the Company had $44 of accrued penalties and $44 of accrued penalties related to uncertain tax positions, none of which has been recognized in the Company’s consolidated statements of operations and comprehensive income for the years ended December 31, 2019 and 2018. There were no ongoing examinations by taxing authorities as of December 31, 2019 and 2018. The Company intends to indefinitely reinvest the PRC earnings outside of the U.S. as of December 31, 2019 and 2018. Thus, deferred taxes are not provided in the U.S. for unremitted earnings in the PRC. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2019 | |
SEGMENT INFORMATION [Abstract] | |
SEGMENT INFORMATION | NOTE 16 – SEGMENT INFORMATION The Company is engaged in the developing, manufacture and sale of single-wafer wet cleaning equipment, which have been organized as one reporting segment as they have substantially similar nature and economic characteristics. The Company’s principal operating decision maker, the Chief Executive Officer, receives and reviews the results of the operations for all major type of equipment as a whole when making decisions about allocating resources and assessing performance of the Company. In accordance with FASB ASC 280-10, the Company is not required to report the segment information. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2019 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 17 – COMMITMENTS AND CONTINGENCIES The Company leases offices under non-cancelable operating lease agreements. See note 8 for future minimum lease payments under non-cancelable operating lease agreements with initial terms of one year or more. As of December 31, 2019, the Company had $431 of open capital commitments. In the normal course of business, the Company is subject to contingencies, including legal proceedings and environmental claims arising out of the normal course of businesses that relate to a wide range of matters, including among others, contracts breach liability. The Company records accruals for such contingencies based upon the assessment of the probability of occurrence and, where determinable, an estimate of the liability. Management may consider many factors in making these assessments including past history, scientific evidence and the specifics of each matter. The Company’s management has evaluated all such proceedings and claims that existed as of December 31, 2019 and 2018. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Company’s financial position, liquidity or results of operations. As of December 31, 2019, the Company did not have any legal proceedings. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2019 | |
SUBSEQUENT EVENTS [Abstract] | |
SUBSEQUENT EVENTS | NOTE 18 – SUBSEQUENT EVENTS The outbreak of COVID‑19, the coronavirus, has grown both in the United States and globally, and related government and private sector responsive actions have adversely affecting the Company’s business operations. COVID‑19 originated in Wuhan, China, in December 2019, and a series of emergency quarantine measures taken by the PRC government disrupted domestic business activities in the PRC during the weeks after the initial outbreak of COVID‑19. Since that time, an increasing number of countries, including the United States, have imposed restrictions on travel to and from the PRC and elsewhere, as well as general movement restrictions, business closures and other measures imposed to slow the spread of COVID‑19. The situation continues to develop rapidly, however, and it is impossible to predict the effect and ultimate impact of the COVID‑19 outbreak on the Company’s business operations and results. While the quarantine, social distancing and other regulatory measures instituted or recommended in response to COVID‑19 are expected to be temporary, the duration of the business disruptions, and related financial impact, cannot be estimated at this time. The COVID‑19 outbreak could evolve into a worldwide health crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn and changes in global economic policy that could reduce demand for the Company’s products and its customers’ chips and have a material adverse impact on the Company’s business, operating results and financial condition. |
RESTRICTED NET ASSETS
RESTRICTED NET ASSETS | 12 Months Ended |
Dec. 31, 2019 | |
RESTRICTED NET ASSETS [Abstract] | |
RESTRICTED NET ASSETS | NOTE 19 – RESTRICTED NET ASSETS In accordance with the PRC’s Foreign Enterprise Law, ACM Shanghai and ACM Wuxi are required to make contributions to a statutory surplus reserve (note 2). As a result of PRC laws and regulations that require annual appropriations of 10% of net after-tax profits to be set aside prior to payment of dividends as a general reserve fund or statutory surplus fund, ACM Shanghai is restricted in its ability to transfer a portion of its net assets to ACM (including any assets received as distributions from ACM Wuxi). Amounts restricted included paid-in capital and statutory reserve funds, as determined pursuant to PRC accounting standards and regulations, were $113,168 and $32,076 as of December 31, 2019 and 2018. |
PARENT COMPANY ONLY CONDENSED F
PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION | 12 Months Ended |
Dec. 31, 2019 | |
PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION [Abstract] | |
PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION | NOTE 20 – PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION The Company performed a test on the restricted net assets of consolidated subsidiaries in accordance with Rule 4-08(e)(3) of Regulation S-X of the SEC and concluded that it was applicable for the Company to disclose the financial information for ACM only. Certain information and footnote disclosures generally included in financial statements prepared in accordance with GAAP have been condensed or omitted. The footnote disclosure contains supplemental information relating to the operations of ACM separately. ACM’s subsidiaries did not pay any dividends to ACM during the periods presented. ACM did not have significant capital or other commitments, long-term obligations, or guarantees as of December 31, 2019 and 2018. The following represents condensed unconsolidated financial information of ACM only as of and for the years ended December 31, 2019 and 2018: CONDENSED BALANCE SHEET December 31, 2019 2018 Assets (in thousands) Current assets: Cash and cash equivalents $ 27,733 $ 13,161 Accounts Receivable - 983 Inventory 444 720 Due from intercompany 4,542 14,494 Other receivable 5 175 Total current assets 32,724 29,533 Investment in unconsolidated subsidiaries 68,527 26,861 Total assets 101,251 56,394 Liabilities and Stockholders’ Equity Accounts payable 1,138 2,818 Other payable 589 58 Income taxes payable 3,129 1,193 Total liabilities 4,856 4,069 Total stockholders’ equity 96,395 52,325 Total liabilities and stockholders’ equity $ 101,251 $ 56,394 CONDENSED STATEMENT OF OPERATIONS Year Ended December 31, 2019 2018 (in thousands) Revenue $ 10,683 $ 25,506 Cost of revenue (10,036 ) (23,927 ) Gross profit 647 1,579 Operating expenses: Sales and marketing expenses (490 ) (301 ) General and administrative expenses (3,639 ) (5,083 ) Research and development expenses (476 ) (255 ) Loss from operations (3,958 ) (4,060 ) Equity in earnings of unconsolidated subsidiaries 22,510 10,360 Interest income, net 231 166 Interest expense, net (67 ) - Non-operating income (expense), net 178 108 Income before income taxes 18,894 6,574 Income tax expense - - Net income $ 18,894 $ 6,574 CONDENSED STATEMENT OF CASH FLOWS Year Ended December 31, 2019 2018 (in thousands) Net cash used in operating activities $ (7,957 ) $ (1,189 ) Net cash provided by investing activities - 946 Net cash provided by financing activities 23,347 3,510 Net increase in cash and cash equivalents 15,390 3,267 Cash and cash equivalents, beginning of year 13,161 10,874 Effect of exchange rate changes on cash and cash equivalents (818 ) (980 ) Cash and cash equivalents, end of year $ 27,733 $ 13,161 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Company’s consolidated financial statements include the accounts of the Company and its subsidiaries including ACM and its subsidiary, ACM Shanghai, which includes ACM Wuxi, ACM Shengwei, and CleanChip (ACM California and ACM Korea). Subsidiaries are those entities in which ACM, directly and indirectly, controls more than one half of the voting power. All significant intercompany transactions and balances have been eliminated upon consolidation. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the balance sheet date and the reported revenues and expenses during the reported period in the consolidated financial statements and accompanying notes. The Company’s significant accounting estimates and assumptions include, but are not limited to, those used for the valuation and recognition of stock-based compensation arrangements and warrant liability, realization of deferred tax assets, assessment for impairment of long-lived assets, allowance for doubtful accounts, inventory valuation for excess and obsolete inventories, lower of cost and market value or net realizable value of inventories, depreciable lives of property and equipment, accrued warranty, and useful life of intangible assets. Management evaluates these estimates and assumptions on a regular basis. Actual results could differ from those estimates and assumptions. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of cash on hand, bank deposits that are unrestricted as to withdrawal and use, and highly liquid investments with an original maturity date of three months or less at the date of purchase. At times, cash deposits may exceed government-insured limits. |
Restricted Cash | Restricted cash Restricted cash represents deposits not readily available to ACM. Restricted cash as of December 31, 2019 represented cash hold in reserve, all of the proceeds received from issuance of common stock to redeemable Non-controlling interest in segregated cash and cash-equivalent accounts. |
Accounts Receivable | Accounts Receivable Accounts receivable are presented net of an allowance for doubtful accounts. The Company reviews its accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balance, a customer’s historical payment history and credit worthiness, and current economic trends. Accounts are written off after all collection efforts have been exhausted. At December 31, 2019 and 2018, the Company, based on a review of its outstanding balances and its customers, determined the allowance for doubtful accounts in the amount of $0 and $0 respectively. |
Inventory | Inventory Inventory consists of raw materials and related goods, work-in-progress, finished goods, and other consumable materials such as spare parts. Finished goods typically are shipped from the Company’s warehouse within one month of completion. Inventory was recorded at the lower of cost or net realizable value at December 31, 2019 and 2018. ● The cost of a general inventory item is determined using the weighted moving average method. Under the weighted moving average method, the Company calculates the new average price of all items of a particular inventory stock each time one or more items of that stock are purchased. The then-current average price of the stock is used for purposes of determining cost of inventory or cost of revenue. The cost of an inventory item purchased specifically for a customized product is determined using the specific identification method. Low-cost consumable materials and packaging materials are expensed as incurred. ● Net realizable value is the estimated selling price, in the ordinary course of business, less estimated costs to complete or dispose. The Company assesses the recoverability of all inventories quarterly to determine if any adjustments are required. Potential excess or obsolete inventory is written off based on management’s analysis of inventory levels and estimates of future 12-month demand and market conditions. |
Property, Plant and Equipment, Net | Property, Plant and Equipment, Net Property, plant and equipment are recorded at cost less accumulated depreciation and any provision for impairment in value. Depreciation begins when the asset is placed in service and is calculated by using the straight-line method over the estimated useful life of an asset (or, if shorter, over the lease term). Betterments or renewals are capitalized when incurred. Plant, property and equipment is reviewed each year to determine whether any events or circumstances indicate that the carrying amount of the assets may not be recoverable. Estimated useful lives of assets in the United States are as follows: Computer and office equipment 3 to 5 years Furniture and fixtures 5 years Leasehold improvements shorter of lease term or estimated useful life ACM’s subsidiaries follow regulations for depreciation of fixed assets implemented under the PRC’s Enterprise Income Tax Law, which state that the minimum useful lives used for calculating depreciation for fixed assets are as follows: Manufacturing equipment for small to medium-sized equipment, 5 years; for large equipment, estimated by purchasing department at time of acceptance Furniture and fixtures 5 years Transportation equipment 4 to 5 years Electronic equipment 3 to 5 years Leasehold improvements remaining lease term for improvements on leased fixed assets or, for large improvements, estimated useful life; not less than 3 years for non-fixed asset repairs Expenditures for maintenance and repairs that neither materially add to the value of the property nor appreciably prolong the life of the property are charged to expense as incurred. Upon retirement or sale of an asset, the cost of the asset and the related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is credited or charged to income. |
Intangible Assets, Net | Intangible Assets, Net Intangible assets consist of software used for finance, manufacturing, and research and development purposes. Assets are valued at cost at the time of acquisition and are amortized over their beneficial periods. If a contract specifies a beneficial period, then the intangible asset is amortized over a term not exceeding the beneficial period. If the contract does not specify a beneficial period, then the intangible asset is amortized over a term not exceeding the valid period specified by local law. If neither the contract nor local law specifies a beneficial period, then the intangible asset is amortized over a period of up to 10 years. Currently, the software that the Company uses is amortized over a two-year period in accordance with the policy described above. |
Investments | Investments The Company uses the equity method of accounting for its investment in, and earning or loss of, companies that it does not control but over which it does exert significant influence. The Company considers whether the fair value of its equity method investment has declined below its carrying value whenever adverse events or changes in circumstances indicate that recorded value may not be recoverable. The Company reviews its investments for other-than-temporary impairment whenever events or changes in business circumstances indicate that the carrying value of the investment may not be fully recoverable. Investments identified as having an indication of impairment are subject to further analysis to determine if the impairment is other-than-temporary and this analysis requires estimating the fair value of the investment. The determination of fair value of the investment involves considering factors such as current economic and market conditions, the operating performance of the entities including current earnings trends and forecasted cash flows, and other company and industry specific information. If the Company considers any decline to be other than temporary (based on various factors, including historical financial results and the overall health of the investee), then a write-down would be recorded to estimated fair value. See note 10 for discussion of equity method investment. |
Valuation of Long-Lived Assets | Valuation of Long-Lived Assets Long-lived assets are evaluated for impairment whenever events or changes in circumstance indicate that the carrying value of the assets may not be fully recoverable or that the useful life of the assets is shorter than the Company had originally estimated. When these events or changes occur, the Company evaluates the impairment of the long-lived assets by comparing the carrying value of the assets to an estimate of future undiscounted cash flows expected to be generated from the use of the assets and their eventual disposition. If the sum of the expected future undiscounted cash flow is less than the carrying value of the assets, the Company recognizes an impairment loss based on the excess of the carrying value over the fair value. No impairment charge was recognized for either of the periods presented. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities and operating lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. It uses the implicit rate when readily determinable. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. |
Redeemable Convertible Preferred Stock | Redeemable Convertible Preferred Stock The Company recorded each series of convertible preferred stock at fair value on the date of issuance, net of issuance costs. The convertible preferred stock is recorded outside of stockholders’ equity (deficit) because, in the event of certain deemed liquidation events considered not solely within the Company’s control (such as a merger, acquisition, or sale of all or substantially all of the Company’s assets), the convertible preferred stock will become redeemable at the option of the holders. The Company has not adjusted the carrying value of any series of convertible preferred stock to the liquidation preference of such series because it is uncertain whether or when an event would occur that would obligate the Company to pay the liquidation preferences to holders of convertible preferred stock. Subsequent adjustments to the carrying values to the liquidation preferences will be made only when it becomes probable that such a liquidation event will occur. |
Redeemable Non-controlling Interests | Redeemable Non-controlling Interests The Company recorded initial carrying amount of redeemable non-controlling interests at fair value on the date of issuance, and presented in temporary equity on the consolidated balance sheets. As the non-controlling interests would be redeemable at a fixed purchase price, it is classified as common-share non-controlling interests redeemable at other than fair value. The Company applied the entire adjustment method (income classification) for subsequent measurement in accordance with ASC 480‑10-S99. |
Revenue Recognition | Revenue Recognition The Company derives revenue principally from the sale of single-wafer wet cleaning equipment. Revenue from contracts with customers is recognized using the following five steps pursuant ASC Topic 606, Revenue from Contracts with Customers 1. Identify the contract(s) with a customer; 2. Identify the performance obligations in the contract; 3. Determine the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue when (or as) the entity satisfies a performance obligation. A contract contains a promise (or promises) to transfer goods or services to a customer. A performance obligation is a promise (or a group of promises) that is distinct. The transaction price is the amount of consideration a company expects to be entitled from a customer in exchange for providing the goods or services. The unit of account for revenue recognition is a performance obligation (a good or service). A contract may contain one or more performance obligations. Performance obligations are accounted for separately if they are distinct. A good or service is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and the good or service is distinct in the context of the contract. Otherwise performance obligations are combined with other promised goods or services until the Company identifies a bundle of goods or services that is distinct. Promises in contracts which do not result in the transfer of a good or service are not performance obligations, as well as those promises that are administrative in nature, or are immaterial in the context of the contract. The Company has addressed whether various goods and services promised to the customer represent distinct performance obligations. The Company applied the guidance of ASC Topic 606-10-25-16 through 18 in order to verify which promises should be assessed for classification as distinct performance obligations. The Company’s contracts with customers include more than one performance obligation. For example, the delivery of a piece of equipment generally includes the promise to install the equipment in the customer’s facility. The Company’s performance obligations in connection with a sale of equipment generally include production, delivery and installation, together with the provision of a warranty. The transaction price is allocated to all the separate performance obligations in an arrangement. It reflects the amount of consideration to which the Company expects to be entitled in exchange for transferring goods or services, which may include an estimate of variable consideration to the extent that it is probable of not being subject to significant reversals in the future based on the Company’s experience with similar arrangements. The transaction price excludes amounts collected on behalf of third parties, such as sales taxes. This is done on a relative selling price basis using standalone selling prices (“SSP”). The SSP represents the price at which the Company would sell that good or service on a standalone basis at the inception of the contract. Given the requirement for establishing SSP for all performance obligations, if the SSP is directly observable through standalone sales, then such sales should be considered in the establishment of the SSP for the performance obligation. The Company does not have observable SSPs for most performance obligations as the obligations are not regularly sold on a standalone basis. Production, delivery and installation of a product, together with provision of a warranty, are a single unit of accounting. Revenue is recognized when the Company satisfies each performance obligation by transferring control of the promised goods or services to the customer. Goods or services can transfer at a point in time (upon the acceptance of the products or upon the arrival at the destination as stipulated in the shipment terms) in a sale arrangement. In general, the Company recognizes revenue when a tool has been demonstrated to meet the customer’s predetermined specifications and is accepted by the customer. If terms of the sale provide for a lapsing customer acceptance period, the Company recognizes revenue as of the earlier of the expiration of the lapsing acceptance period and customer acceptance. In the following circumstances, however, the Company recognizes revenue upon shipment or delivery, when legal title to the tool is passed to a customer as follows: ● When the customer has previously accepted the same tool with the same specifications and the Company can objectively demonstrate that the tool meets all of the required acceptance criteria; ● When the sales contract or purchase order contains no acceptance agreement or lapsing acceptance provision and the Company can objectively demonstrate that the tool meets all of the required acceptance criteria; ● When the customer withholds acceptance due to issues unrelated to product performance, in which case revenue is recognized when the system is performing as intended and meets predetermined specifications; or ● When the Company’s sales arrangements do not include a general right of return. The Company offers post-warranty period services, which consist principally of the installation and replacement of parts and small-scale modifications to the equipment. The related revenue and costs of revenue are recognized when parts have been delivered and installed, risk of loss has passed to the customer, and collection is probable. The Company does not expect revenue from extended maintenance service contracts to represent a material portion of its revenue in the future. The Company incurs costs related to the acquisition of its contracts with customers in the form of sales commissions. Sales commissions are paid to third party representatives and distributors. Contractual agreements with these parties outline commission structures and rates to be paid. Generally speaking, the contracts are all individual procurement decisions by the customers and are not for significant periods of time, nor do they include renewal provisions. As such, all contracts have an economic life of significantly less than a year. Accordingly, the Company expenses sales commissions when incurred. These costs are recorded within sales and marketing expenses. The Company does not incur any costs to fulfill the contracts with customers that are not already reported in compliance with another applicable standard (for example, inventory or plant, property and equipment). |
Cost of Revenue | Cost of Revenue Cost of revenue primarily consists of: direct materials, comprised principally of parts used in assembling equipment, together with crating and shipping costs; direct labor, including salaries and other labor related expenses attributable to the Company’s manufacturing department; and allocated overhead cost, such as personnel cost, depreciation expense, and allocated administrative costs associated with supply chain management and quality assurance activities, as well as shipping insurance premiums. |
Research and Development Costs | Research and Development Costs Research and development costs relating to the development of new products and processes, including significant improvements and refinements to existing products or to the process of supporting customer evaluations of tools, including the development of new tools for evaluation by customers during the product demonstration process, are expensed as incurred. |
Shipping and Handling Costs | Shipping and Handling Costs Shipping and handling costs, which relate to transportation of products to customer locations, are charged to selling and marketing expense. For the year ended December 31, 2019 and 2018, shipping and handling costs included in sales and marketing expenses were $172 and $146 respectively. |
Borrowing Costs | Borrowing Costs Borrowing costs attributable directly to the acquisition, construction or production of qualifying assets that require a substantial period of time to be ready for their intended use or sale are capitalized as part of the cost of those assets. Income earned on temporary investments of specific borrowings pending their expenditure on those assets is deducted from borrowing costs capitalized. All other borrowing costs are recognized in interest expenses in the consolidated statements of operations and comprehensive income in the period in which they are incurred. No borrowing costs were capitalized for the year ended December 31, 2019 or 2018. |
Warranty | Warranty For each of its products, the Company generally provides a standard warranty ranging from 12 to 36 months and covering replacement of the product during the warranty period. The Company accounts for the estimated warranty costs as sales and marketing expenses at the time revenue is recognized. Warranty obligations are affected by historical failure rates and associated replacement costs. Utilizing historical warranty cost records, the Company calculates a rate of warranty expenses to revenue to determine the estimated warranty charge. The Company updates these estimated charges on a regular basis. Warranty obligations are included in other payables and accrued expenses in the consolidated balance sheets. Year Ended December 31, 2019 2018 Balance at beginning of period $ 1,710 $ 839 Additions 2,105 1,412 Utilized (1,004 ) (541 ) Balance at end of period $ 2,811 $ 1,710 |
Government Subsidies | Government Subsidies ACM Shanghai has been awarded four subsidies from local and central governmental authorities in the PRC. The first subsidy, which was awarded in October 2008, relates to the development and commercialization of 65 to 45nm Stress Free Polishing technology. The second subsidy was awarded in April 2009 to fund interest expenses for short-term borrowings. The third subsidy was awarded in January 2014 and relates to the development of Electro Copper Plating technology. The fourth subsidy was awarded in June of 2018, and related to development of Polytetrafluoroethylene. The PRC governmental authorities will provide the majority of the funding, although ACM Shanghai is also required to invest certain amounts in the projects. The government subsidies contain certain operating conditions and therefore are recorded as long-term liabilities upon receipt. The grant amounts are recognized in the statements of operations and comprehensive income: ● Government subsidies relating to current expenses are recorded as reductions of those expenses in the periods in which the current expenses are recorded. For the years ended December 31, 2019 and 2018, related government subsidies recognized as reductions of relevant expenses in the consolidated statements of operations and comprehensive income were $3,195 and $1,486, respectively. ● Government subsidies related to depreciable assets are credited to income over the useful lives of the related assets for which the grant was received. For the years ended December 31, 2019 and 2018, related government subsidies recognized as other income in the consolidated statements of operations and comprehensive income were $147 and $144, respectively. Unearned government subsidies received are deferred for recognition and recorded as other long-term liabilities (note 9) in the balance sheet until the criteria for such recognition are satisfied. |
Stock-based Compensation | Stock-based Compensation ACM grants stock options to employees and non-employee consultants and directors and accounts for those stock-based awards in accordance with FASB ASC Topic 718, Compensation – Stock Compensation. Stock-based awards granted to employees and non-employee consultants and directors are measured at the fair value of the awards on the grant date and are recognized as expenses either (a) immediately on grant, if no vesting conditions are required or (b) using the graded vesting method, net of estimated forfeitures, over the requisite service period. The fair value of stock options is determined using the Black-Scholes valuation model. Stock-based compensation expense, when recognized, is charged to the category of operating expense corresponding to the service function of the employees and non-employee consultants and directors. |
Income Taxes | Income Taxes The Company accounts for income taxes using the liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable values. In evaluating the ability to recover its deferred income tax assets, the Company considers all available positive and negative evidence, including its operating results, ongoing tax planning and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis. In the event the Company determines that it would be able to realize its deferred income tax assets in the future in excess of their net recorded amount, it would make an adjustment to the valuation allowance that would reduce the provision for income taxes. Conversely, in the event that all or part of the net deferred tax assets are determined not to be realizable in the future, an adjustment to the valuation allowance would be charged to earnings in the period such determination is made. Tax benefits related to uncertain tax positions are recognized when it is more likely than not that a tax position will be sustained during an audit. Interest and penalties related to unrecognized tax benefits are included within the provision for income tax. |
Basic and Diluted Net Income per Common Share | Basic and Diluted Net Income per Common Share Basic and diluted net income per common share are calculated as follows: Year Ended December 31, 2019 2018 Numerator: Net income $ 19,458 $ 6,574 Net income attributable to redeemable non-controlling interest 564 - Net income available to common stockholders, basic and diluted $ 18,894 $ 6,574 Weighted average shares outstanding, basic 16,800,623 15,788,460 Effect of dilutive securities 2,334,874 2,123,645 Weighted average shares outstanding, diluted 19,135,497 17,912,105 Net income per common share: Basic $ 1.12 $ 0.42 Diluted $ 0.99 $ 0.37 Basic and diluted net income per common share are presented using the two-class method, which allocates undistributed earnings to common stock and any participating securities according to dividend rights and participation rights on a proportionate basis. Under the two-class method, basic net income (per common share is computed by dividing the sum of distributed and undistributed earnings attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Shares of ACM’s Series A, B, C, D, E and F convertible preferred stock are participating securities, as the holders are entitled to participate in and receive the same dividends as may be declared for common stockholders on a pro-rata, if-converted basis. ACM has been authorized to issue Class A and Class B common stock since redomesticating in Delaware in November 2016. The two classes of common stock are substantially identical in all material respects, except for voting rights. Since ACM did not declare any dividends during the years ended December 31, 2019 and 2018, the net income (loss) per common share attributable to each class is the same under the “two-class” method. As such, the two classes of common stock have been presented on a combined basis in the consolidated statements of operations and comprehensive income and in the above computation of net income per common share. Diluted net income per common share reflects the potential dilution from securities that could share in ACM’s earnings. Certain potential dilutive securities were excluded from the net income per share calculation because the impact would be anti-dilutive. The potentially dilutive securities that were not included in the calculation of diluted net income per share in the periods presented where their inclusion would be anti-dilutive are as follows: Year Ended December 31, 2019 2018 Stock Options 4,095,676 3,715,779 Warrant 77,810 80,000 4,173,486 3,795,779 |
Comprehensive Income Attributable to the Company | Comprehensive Income Attributable to the Company The Company applies FASB ASC Topic 220, Comprehensive Income, which establishes standards for the reporting and display of comprehensive income or loss, requiring its components to be reported in a financial statement with the same prominence as other financial statements. The comprehensive income attributable to the Company was $18,559 and $5,595 for the years ended December 31, 2019 and 2018, respectively. |
Statutory Reserves | Statutory reserves The income of ACM’s PRC subsidiaries is distributable to their shareholders after transfers to reserves as required under relevant PRC laws and regulations and the subsidiaries’ Articles of Association. As stipulated by the relevant laws and regulations in the PRC, the PRC subsidiaries are required to maintain reserves, including reserves for statutory surpluses and public welfare funds that are not distributable to shareholders. A PRC subsidiary’s appropriations to the reserves are approved by its board of directors. At least 10% of annual statutory after-tax profits, as determined in accordance with PRC accounting standards and regulations, is required to be allocated to the statutory surplus reserves. If the cumulative total of the statutory surplus reserves reaches 50% of a PRC subsidiary’s registered capital, any further appropriation is optional. Statutory surplus reserves may be used to offset accumulated losses or to increase the registered capital of a PRC subsidiary, subject to approval from the relevant PRC authorities, and are not available for dividend distribution to the subsidiary’s shareholders. The PRC subsidiaries are prohibited from distributing dividends unless any losses from prior years have been offset. Except for offsetting prior years’ losses, however, statutory surplus reserves must be maintained at a minimum of 25% of share capital after such usage. ACM Shanghai estimated a statutory surplus reserve of $1,427 based on an accumulated profit as of December 31, 2019 which is included in the accumulated surplus in the consolidated balance sheets, versus no statutory surplus reserved due to accumulated losses as of December 31, 2018. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Under the FASB’s authoritative guidance on fair value measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining the fair value, the Company uses various methods including market, income and cost approaches. Based on these approaches, the Company often utilizes certain assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable inputs. The Company uses valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Based on observability of the inputs used in the valuation techniques, the Company is required to provide the following information according to the fair value hierarchy. The fair value hierarchy ranks the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: Level 1: Valuations for assets and liabilities traded in active exchange markets. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities. Level 2: Valuations for assets and liabilities traded in less active dealer or broker markets. Valuations are obtained from third party pricing services for identical or similar assets or liabilities. Level 3: Valuations for assets and liabilities that are derived from other valuation methodologies, including option pricing models, discounted cash flow models and similar techniques, and not based on market exchange, dealer or broker traded transactions. Level 3 valuations incorporate certain unobservable assumptions and projections in determining the fair value assigned to such assets. All transfers between fair value hierarchy levels are recognized by the Company at the end of each reporting period. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. The inputs or methodology used for valuing financial instruments are not necessarily an indication of the risks associated with investment in those instruments. Fair Value Measured or Disclosed on a Recurring Basis Warrant liability Other financial items for disclosure purpose |
Operating and Financial Risks | Operating and Financial Risks Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk consist principally of cash and cash equivalents, restricted cash and accounts receivable. The Company deposits and invests its cash with financial institutions that management believes are creditworthy. The Company is potentially subject to concentrations of credit risks in its accounts receivable. Three customers individually accounted for greater than ten percent of the Company’s revenue for the year ended 2019 and the year ended 2018: Year Ended December 31, 2019 2018 Customer A 26.46 % 24.17 % Customer B 19.84 % 23.83 % Customer C 27.50 % 39.63 % Interest Rate Risk As of December 31, 2019 and 2018, the balance of bank borrowings (note 6) was short-term in nature, matured at various dates within the following year and did not expose the Company to interest rate risk. Liquidity Risk The Company’s working capital at December 31, 2019 and 2018 was sufficient to meet its then-current requirements. The Company may, however, require additional cash due to changing business conditions or other future developments, including any investments or acquisitions the Company decides to pursue. In the long run, the Company intends to rely primarily on cash flows from operations and additional borrowings from financial institutions in order to meet its cash needs. If those sources are insufficient to meet cash requirements, the Company may seek to issue additional debt or equity. Country Risk The Company has significant investments in the PRC. The operating results of the Company may be adversely affected by changes in the political and social conditions in the PRC and by changes in Chinese government policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. Foreign Currency Risk and Translation The Company’s consolidated financial statements are presented in U.S. dollars, which is the Company’s reporting currency, while the functional currency of ACM’s subsidiaries is the Chinese Renminbi (“RMB”), and the Korean Won. Changes in the relative values of U.S. dollars and Chinese RMB affect the Company’s reported levels of revenues and profitability as the results of its operations are translated from RMB into U.S. dollars for reporting purposes. Because the Company has not engaged in any hedging activities, it cannot predict the impact of future exchange rate fluctuations on the results of its operations and it may experience economic losses as a result of foreign currency exchange rate fluctuations. Transactions of ACM’s subsidiaries involving foreign currencies are recorded in functional currency according to the rate of exchange prevailing on the date when the transaction occurs. The ending balances of the Company’s foreign currency accounts are converted into functional currency using the rate of exchange prevailing at the end of each reporting period. Net gains and losses resulting from foreign exchange fluctuations as marked to market at year-end are included in the consolidated statements of operations and comprehensive income. Total foreign currency translation adjustment was ($899) and ($979) for the years ended December 31, 2019 and 2018. In accordance with FASB ASC Topic 830, Foreign Currency Matters Translations of amounts from RMB and Korean Won into U.S. dollars were made at the following exchange rates for the respective dates and periods: At December 31, 2019 2018 Consolidated balance sheets: RMB to $1.00 6.9784 6.8634 KRW to $1.00 1,156.07 1,114.83 Consolidated statements of operations and comprehensive income: RMB to $1.00 6.8966 6.6181 KRW to $1.00 1,165.50 1,100.11 |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) ASU 2016-02 Leases Leases Effective January 1, 2019, the Company adopted ASU 2016-02. The original guidance required application on a modified retrospective basis with the earliest period presented. In August 2018, the FASB issued ASU 2018-11, Targeted Improvements to ASC 842 Leases In June 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718)—Improvements to Nonemployee Share-Based Payment Accounting Compensation—Stock Compensation Revenue from Contracts with Customers (Topic 606) In February 2018, the FASB issued ASU No. 2018-02, “Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” Recent Accounting Pronouncements Not Yet Adopted In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ASU 2017-04 ASU 2017-04 In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
DESCRIPTION OF BUSINESS (Tables
DESCRIPTION OF BUSINESS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
DESCRIPTION OF BUSINESS [Abstract] | |
Direct or Indirect Interests of Subsidiaries | The Company has direct or indirect interests in the following subsidiaries: Place and date of Effective interest held as at Name of subsidiaries incorporation December 31, 2019 December 31, 2018 ACM Research (Shanghai), Inc. China, May 2006 91.7% 100.0% ACM Research (Wuxi), Inc. China, July 2011 91.7% 100.0% CleanChip Technologies Limited Hong Kong, June 2017 91.7% 100.0% ACM Research Korea CO., LTD. Korea, December 2017 91.7% 100.0% Shengwei Research (Shanghai), Inc. China, March 2019 91.7% 100.0% ACM Research (CA), Inc. USA, June 2019 91.7% 100.0% |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Estimated Useful Lives of Property, Plant and Equipment | Estimated useful lives of assets in the United States are as follows: Computer and office equipment 3 to 5 years Furniture and fixtures 5 years Leasehold improvements shorter of lease term or estimated useful life ACM’s subsidiaries follow regulations for depreciation of fixed assets implemented under the PRC’s Enterprise Income Tax Law, which state that the minimum useful lives used for calculating depreciation for fixed assets are as follows: Manufacturing equipment for small to medium-sized equipment, 5 years; for large equipment, estimated by purchasing department at time of acceptance Furniture and fixtures 5 years Transportation equipment 4 to 5 years Electronic equipment 3 to 5 years Leasehold improvements remaining lease term for improvements on leased fixed assets or, for large improvements, estimated useful life; not less than 3 years for non-fixed asset repairs |
Warranty Obligations | The following table shows changes in the Company’s warranty obligations for the year ended December 31, 2019 and 2018, respectively. Year Ended December 31, 2019 2018 Balance at beginning of period $ 1,710 $ 839 Additions 2,105 1,412 Utilized (1,004 ) (541 ) Balance at end of period $ 2,811 $ 1,710 |
Basic and Diluted Net Income per Common Share | Basic and diluted net income per common share are calculated as follows: Year Ended December 31, 2019 2018 Numerator: Net income $ 19,458 $ 6,574 Net income attributable to redeemable non-controlling interest 564 - Net income available to common stockholders, basic and diluted $ 18,894 $ 6,574 Weighted average shares outstanding, basic 16,800,623 15,788,460 Effect of dilutive securities 2,334,874 2,123,645 Weighted average shares outstanding, diluted 19,135,497 17,912,105 Net income per common share: Basic $ 1.12 $ 0.42 Diluted $ 0.99 $ 0.37 |
Antidilutive Securities Excluded from Computation of Earnings Per Share | The potentially dilutive securities that were not included in the calculation of diluted net income per share in the periods presented where their inclusion would be anti-dilutive are as follows: Year Ended December 31, 2019 2018 Stock Options 4,095,676 3,715,779 Warrant 77,810 80,000 4,173,486 3,795,779 |
Concentration of Credit Risk | Three customers individually accounted for greater than ten percent of the Company’s revenue for the year ended 2019 and the year ended 2018: Year Ended December 31, 2019 2018 Customer A 26.46 % 24.17 % Customer B 19.84 % 23.83 % Customer C 27.50 % 39.63 % |
Translations of Foreign Exchange Rate | Translations of amounts from RMB and Korean Won into U.S. dollars were made at the following exchange rates for the respective dates and periods: At December 31, 2019 2018 Consolidated balance sheets: RMB to $1.00 6.9784 6.8634 KRW to $1.00 1,156.07 1,114.83 Consolidated statements of operations and comprehensive income: RMB to $1.00 6.8966 6.6181 KRW to $1.00 1,165.50 1,100.11 |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
ACCOUNTS RECEIVABLE [Abstract] | |
Accounts Receivable | At December 31, 2019 and 2018, accounts receivable consisted of the following: December 31, 2019 2018 Accounts receivable $ 31,091 $ 24,608 Less: Allowance for doubtful accounts - - Total $ 31,091 $ 24,608 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INVENTORIES [Abstract] | |
Inventory | At December 31, 2019 and 2018, inventory consisted of the following: December 31, 2019 2018 Raw materials $ 15,105 $ 12,646 Work in process 10,407 9,631 Finished goods 19,284 16,487 Total inventory, gross 44,796 38,764 Inventory reserve - - Total inventory, net $ 44,796 $ 38,764 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
PROPERTY, PLANT AND EQUIPMENT, NET [Abstract] | |
Property, Plant and Equipment | At December 31, 2019 and 2018, property, plant and equipment consisted of the following: December 31, 2019 2018 Manufacturing equipment $ 3,902 $ 9,703 Office equipment 627 512 Transportation equipment 124 184 Leasehold improvement 1,442 1,379 Total cost 6,095 11,778 Less: Total accumulated depreciation (3,077 ) (8,102 ) Construction in progress 601 32 Total property, plant and equipment, net $ 3,619 $ 3,708 |
SHORT-TERM BORROWINGS (Tables)
SHORT-TERM BORROWINGS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SHORT-TERM BORROWINGS [Abstract] | |
Short-Term Borrowings | At December 31, 2019 and 2018, short-term borrowings consisted of the following: December 31, 2019 2018 Line of credit up to RMB 50,000 from Bank of Shanghai Pudong Branch, due on April 17,2019 with an annual interest rate of 4.99%, guaranteed by the Company’s CEO and fully repaid on March 27, 2019. $ - $ 3,133 Line of credit up to RMB 50,000 from Bank of Shanghai Pudong Branch, due on February 14,2019 with an annual interest rate of 5.15%, guaranteed by the Company’s CEO and fully repaid on February 14, 2019. 485 Line of credit up to RMB 50,000 from Bank of Shanghai Pudong Branch, due on January 23, 2020 with an annual interest rate of 5.22%, guaranteed by the Company’s CEO and Cleanchip Technologies Limited.Only RMB 14,500 was repaid on December 13,2019. 5,057 Line of credit up to RMB 30,000 from Bank of China Pudong Branch, due on June 6,2019 with annual interest rate of 5.22%,secured by certain of the Company’s intellectual property and the Company’s CEO and fully repaid on June 6,2019. 2,186 Line of credit up to RMB 30,000 from Bank of China Pudong Branch, due on June 13,2019 with annual interest rate of 5.22%,secured by certain of the Company’s intellectual property and the Company’s CEO and fully repaid on June 13,2019. 2,186 Line of credit up to RMB 10,000 from Shanghai Rural Commercial Bank, due on January 23, 2019 with an annual interest rate of 5.44%, guaranteed by the Company’s CEO and pledged by accounts receivable,and fully repaid on January 23, 2019. 1,457 Line of credit up to RMB 20,000 from Shanghai Rural Commercial Bank, due on February 21, 2020 with an annual interest rate of 5.66%, guaranteed by the Company’s CEO and pledged by accounts receivable. 1,433 Line of credit up to RMB 20,000 from Bank of Communications, due on January 18, 2020 with an annual interest rate of 5.66%. 1,433 Line of credit up to RMB 20,000 from Bank of Communications, due on January 22, 2020 with an annual interest rate of 5.66%. 717 Line of credit up to RMB 20,000 from Bank of Communications, due on February 14, 2020 with an annual interest rate of 5.66%. 717 Line of credit up to RMB 50,000 from China Everbright Bank, due on March 25, 2020 with an annual interest rate of 4.94%, guaranteed by the Company’s CEO. 3,250 Line of credit up to RMB 50,000 from China Everbright Bank, due on April 17, 2020 with an annual interest rate of 5.66%, guaranteed by the Company’s CEO. 1,146 Total $ 13,753 $ 9,447 |
OTHER PAYABLE AND ACCRUED EXP_2
OTHER PAYABLE AND ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
OTHER PAYABLE AND ACCRUED EXPENSES [Abstract] | |
Other Payable and Accrued Expenses | At December 31, 2019 and 2018, other payable and accrued expenses consisted of the following: December 31, 2019 2018 Lease expenses and payable for leasehold improvement due to a related party (note 11) $ - $ 53 Accrued commissions 4,082 2,931 Accrued warranty 2,811 1,710 Accrued payroll 2,092 626 Accrued professional fees 165 64 Accrued machine testing fees 1,456 3,076 Others 2,268 1,950 Total $ 12,874 $ 10,410 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LEASES [Abstract] | |
Components of Lease Expense | The components of lease expense were as follows: Year Ended December 31, 2019 Operating lease cost $ 1,432 Short-term lease cost 165 Lease cost $ 1,597 |
Supplemental Cash Flow Information Related to Operating Leases | Supplemental cash flow information related to operating leases was as follows for the period ended December 31, 2019: Year Ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflow from operating leases $ 1,597 |
Maturities of Lease Liabilities for Operating Leases | Maturities of lease liabilities for all operating leases were as follows as of December 31, 2019: December 31, 2020 $ 1,504 2021 1,488 2022 1,496 2023 53 2024 13 Total lease payments 4,554 Less: Interest (667 ) Present value of lease liabilities $ 3,887 |
Weighted Average Remaining Lease Terms and Discount Rates for Operating Leases | The weighted average remaining lease terms and discount rates for all operating leases were as follows as of December 31 2019: December 31, 2019 Remaining lease term and discount rate: Weighted average remaining lease term (years) 3.02 Weighted average discount rate 5.43 % |
OTHER LONG-TERM LIABILITIES (Ta
OTHER LONG-TERM LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
OTHER LONG-TERM LIABILITIES [Abstract] | |
Other Long-Term Liabilities | As of December 31, 2019 and 2018, other long-term liabilities consisted of the following unearned government subsidies: December 31, 2019 2018 Subsidies to Stress Free Polishing project, commenced in 2008 and 2017 $ 1,251 $ 1,483 Subsidies to Electro Copper Plating project, commenced in 2014 2,666 2,860 Subsidies to Polytetrafluoroethylene project, commenced in 2018 135 178 Other 134 62 Total $ 4,186 $ 4,583 |
LONG-TERM INVESTMENT (Tables)
LONG-TERM INVESTMENT (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LONG-TERM INVESTMENT [Abstract] | |
Long-Term Investment | For the years ended December 31, 2019 and 2018 the Company’s share of equity investees’ net income was $168 and $123, respectively, which was included in income on equity method investment in the accompanying consolidated statements of operations and comprehensive income. December 31, 2019 2018 Investment – equity method $ 5,827 $ 1,360 Investment – cost method 107 - Total $ 5,934 $ 1,360 |
REDEEMABLE NON-CONTROLLING IN_2
REDEEMABLE NON-CONTROLLING INTERESTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
REDEEMABLE NON-CONTROLLING INTERESTS [Abstract] | |
Components of Change in Redeemable Non-controlling Interests | The components of the change in the redeemable non-controlling interests for the year ended December 31, 2019 are presented in the following table: Balance at January 1, 2019 $ - Increase in redeemable non-controlling interests due to issuance of common stock Tranche 1: 27,264 Tranche 2: 32,415 Net income attributable to redeemable non-controlling interests 564 Effect of foreign currency translation loss attributable to redeemable non-controlling interests (81 ) Balance at December 31, 2019 $ 60,162 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stock-Based Compensation [Abstract] | |
Assumptions Used to Determine Fair Value of Share Options Granted | The fair value of each option granted to employee is estimated on the grant date using the Black-Scholes valuation model with the following assumptions. December 31, 2019 2018 Fair value of common share(1) $ 13.64-16.81 $ 5.31-13.85 Expected term in years(2) 6.25 6.25 Volatility(3) 39.91%-40.35 % 39.14%-43.00 % Risk-free interest rate(4) 1.69%-2.46 % 2.55%-2.96 % Expected dividend(5) 0 % 0 % (1) Common stock value was the close market value on the grant date. (2) Expected term of share options is based on the average of the vesting period and the contractual term for each grant according to Staff Accounting Bulletin 110. (3) Volatility is calculated based on the historical volatility of ACM’s comparable companies in the period equal to the expected term of each grant. (4) Risk-free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of the share options in effect at the time of grant. (5) Expected dividend is assumed to be 0% as ACM has no history or expectation of paying a dividend on its common stock. |
Employee Share Option [Member] | |
Stock-Based Compensation [Abstract] | |
Summary of Share Option Activities | The following table summarizes the Company’s employee share option activities during the years ended December 31, 2018 and December 31, 2019: Number of Weighted Weighted Average Exercise Weighed Average Remaining Contractual Term Outstanding at December 31, 2017 2,045,616 $ 0.66 $ 2.46 7.57 years Granted 745,700 1.52 8.12 Exercised (151,650 ) $ 0.53 $ 2.06 Expired (4,622 ) 0.55 3.00 Forfeited (131,639 ) $ 0.97 $ 3.87 Outstanding at December 31, 2018 2,503,405 0.91 4.09 7.30 years Granted 656,000 $ 6.29 $ 16.21 Exercised (106,768 ) 0.60 2.09 Expired (2,757 ) $ 3.34 $ 8.16 Forfeited/cancelled (55,817 ) 2.38 6.23 Outstanding at December 31, 2019 2,994,063 $ 2.59 $ 6.77 7.05 years Vested and exercisable at December 31, 2019 1,773,048 |
Non-Employee Share Option [Member] | |
Stock-Based Compensation [Abstract] | |
Summary of Share Option Activities | The following table summarizes the Company’s non-employee share option activities during the year ended December 31, 2018 and 2019: Number of Weighted Weighted Weighted Average Outstanding at December 31, 2017 1,326,676 $ 0.78 2.52 7.54 years Granted - - - - Exercised (114,302 ) 0.43 1.92 - Expired - - - - Forfeited - - - - Outstanding at December 31, 2018 1,212,374 0.78 2.57 6.66 years Granted - - - - Exercised (88,529 ) 0.45 1.06 - Expired - - - - Forfeited/cancelled (22,232 ) 0.55 3.00 - Outstanding at December 31, 2019 1,101,613 0.82 2.69 5.85 years Vested and exercisable at December 31, 2019 1,024,017 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INCOME TAXES [Abstract] | |
Components of Income Tax Benefit (Expense) | The following represent components of the income tax benefit (expense) for the years ended December 31, 2019 and 2018: Year Ended December 31, 2019 2018 Current: U.S. federal $ - $ - U.S. state - - Foreign (3,176 ) (1,149 ) Total current tax expense (3,176 ) (1,149 ) Deferred: U.S. federal 3,728 - U.S. state - Foreign (34 ) 343 Total deferred tax benefit 3,694 343 Total income tax benefit (expense) $ 518 $ (806 ) |
Deferred tax Assets | Tax effects of temporary differences that give rise to significant portions of the Company’s deferred tax assets at December 31, 2019 and 2018 are presented below: Year Ended December 31, 2019 2018 Deferred tax assets: Net operating loss carry forwards (offshore) $ 216 $ 16 Net operating loss carry forwards (U.S.) and credit 3,218 4,105 Deferred revenue (offshore) 1,181 558 Accruals (U.S.) 15 11 Reserves and other (offshore) 426 1,080 Stock-based compensation (U.S.) 1,168 1,021 Property and equipment (U.S.) 3 1 Total gross deferred tax assets 6,227 6,792 Less: valuation allowance (896 ) (5,155 ) Total deferred tax assets 5,331 1,637 Total deferred tax liabilities - - Translation difference - - Deferred tax assets, net $ 5,331 $ 1,637 |
Effective Income Tax Rate | Income tax expense for the years ended December 31, 2019 and 2018 differed from the amounts computed by applying the statutory federal income tax rate of 21% to pretax income (loss) as a result of the following: Year Ended December 31, 2019 2018 Effective tax rate reconciliation: Income tax provision at statutory rate 21.00 % 21.00 % Foreign rate differential (12.26 ) (20.88 ) Other permanent difference 8.71 15.59 Change in valuation allowance (20.19 ) (4.78 ) Total income tax expense (benefit) (2.74 %) 10.93 % |
Aggregate Changes in Balance of Gross Unrecognized Tax Benefits | The aggregate changes in the balance of gross unrecognized tax benefits, which excludes interest and penalties, for the years ended December 31, 2019 and 2018, are as follows: Year Ended December 31, 2019 2018 Beginning balance $ 44 $ 44 Increase/ (decrease) of unecognized tax benefits taken in prior years - - Increase/ (decrease) of unecognized tax benefits related to current year - - Increase/ (decrease) of unrecognized tax benefits related to settlements - - Reductions to unrecognized tax benefits related to lapsing statute of limitations - - Ending balance $ 44 $ 44 |
PARENT COMPANY ONLY CONDENSED_2
PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION [Abstract] | |
Condensed Balance Sheet | CONDENSED BALANCE SHEET December 31, 2019 2018 Assets (in thousands) Current assets: Cash and cash equivalents $ 27,733 $ 13,161 Accounts Receivable - 983 Inventory 444 720 Due from intercompany 4,542 14,494 Other receivable 5 175 Total current assets 32,724 29,533 Investment in unconsolidated subsidiaries 68,527 26,861 Total assets 101,251 56,394 Liabilities and Stockholders’ Equity Accounts payable 1,138 2,818 Other payable 589 58 Income taxes payable 3,129 1,193 Total liabilities 4,856 4,069 Total stockholders’ equity 96,395 52,325 Total liabilities and stockholders’ equity $ 101,251 $ 56,394 |
Condensed Statement of Operations | CONDENSED STATEMENT OF OPERATIONS Year Ended December 31, 2019 2018 (in thousands) Revenue $ 10,683 $ 25,506 Cost of revenue (10,036 ) (23,927 ) Gross profit 647 1,579 Operating expenses: Sales and marketing expenses (490 ) (301 ) General and administrative expenses (3,639 ) (5,083 ) Research and development expenses (476 ) (255 ) Loss from operations (3,958 ) (4,060 ) Equity in earnings of unconsolidated subsidiaries 22,510 10,360 Interest income, net 231 166 Interest expense, net (67 ) - Non-operating income (expense), net 178 108 Income before income taxes 18,894 6,574 Income tax expense - - Net income $ 18,894 $ 6,574 |
Condensed Statement of Cash Flows | CONDENSED STATEMENT OF CASH FLOWS Year Ended December 31, 2019 2018 (in thousands) Net cash used in operating activities $ (7,957 ) $ (1,189 ) Net cash provided by investing activities - 946 Net cash provided by financing activities 23,347 3,510 Net increase in cash and cash equivalents 15,390 3,267 Cash and cash equivalents, beginning of year 13,161 10,874 Effect of exchange rate changes on cash and cash equivalents (818 ) (980 ) Cash and cash equivalents, end of year $ 27,733 $ 13,161 |
DESCRIPTION OF BUSINESS (Detail
DESCRIPTION OF BUSINESS (Details) ¥ / shares in Units, ¥ in Thousands, $ in Thousands | Nov. 29, 2019USD ($)Investor | Nov. 29, 2019CNY (¥)Investor¥ / shares | Jun. 17, 2019 | Jun. 12, 2019USD ($)Investor | Jun. 12, 2019CNY (¥)Investor | Sep. 13, 2017 | Sep. 30, 2019 | Dec. 31, 2019USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2019CNY (¥) | Dec. 31, 2018 | Nov. 08, 2017 | Aug. 31, 2017 |
Class A Common Stock [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Reverse stock split | 0.33 | ||||||||||||
Class B Common Stock [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Reverse stock split | 0.33 | ||||||||||||
ACM Research (Shanghai), Inc. [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Purchase of equity interest percentage | 18.36% | 18.77% | |||||||||||
Term to complete listing of shares | 3 years | ||||||||||||
Name of subsidiaries | ACM Research (Shanghai), Inc. | ||||||||||||
Date and place of Incorporation | China, May 2006 | ||||||||||||
Effective interest held as at | 91.70% | 100.00% | |||||||||||
ACM Research (Shanghai), Inc. [Member] | First Tranche Investors [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Purchase of equity interest percentage | 3.80% | ||||||||||||
Number of investors with agreements entered | Investor | 7 | 7 | |||||||||||
Purchase price of stock agreed by investors | $ 27,300 | ¥ 187,900 | |||||||||||
Percentage of outstanding shares to be sold to investors | 4.20% | 4.20% | 4.20% | ||||||||||
ACM Research (Shanghai), Inc. [Member] | Second Tranche Investors [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Purchase of equity interest percentage | 4.50% | ||||||||||||
Number of investors with agreements entered | Investor | 8 | 8 | |||||||||||
Purchase price of stock agreed by investors | $ 32,400 | ¥ 228,200 | |||||||||||
Share price (in RMB per share) | ¥ / shares | ¥ 13 | ||||||||||||
ACM Research (Wuxi), Inc. [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Name of subsidiaries | ACM Research (Wuxi), Inc. | ||||||||||||
Date and place of Incorporation | China, July 2011 | ||||||||||||
Effective interest held as at | 91.70% | 100.00% | |||||||||||
CleanChip Technologies Limited [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Proceeds from sale of interest in subsidary | $ | $ 3,500 | ||||||||||||
Name of subsidiaries | CleanChip Technologies Limited | ||||||||||||
Date and place of Incorporation | Hong Kong, June 2017 | ||||||||||||
Effective interest held as at | 91.70% | 100.00% | |||||||||||
ACM Research Korea CO., LTD [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Name of subsidiaries | ACM Research Korea CO., LTD. | ||||||||||||
Date and place of Incorporation | Korea, December 2017 | ||||||||||||
Effective interest held as at | 91.70% | 100.00% | |||||||||||
Shengwei Research (Shanghai), Inc. [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Purchase of equity interest percentage | 91.70% | ||||||||||||
Registered capital | $ 727 | ¥ 5,000 | |||||||||||
Capital injected in subsidiary | $ | $ 142 | ||||||||||||
Name of subsidiaries | Shengwei Research (Shanghai), Inc. | ||||||||||||
Date and place of Incorporation | China, March 2019 | ||||||||||||
Effective interest held as at | 91.70% | 100.00% | |||||||||||
ACM Research (CA), Inc. [Member] | |||||||||||||
Description of Business [Abstract] | |||||||||||||
Name of subsidiaries | ACM Research (CA), Inc. | ||||||||||||
Date and place of Incorporation | USA, June 2019 | ||||||||||||
Effective interest held as at | 91.70% | 100.00% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Accounts Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts Receivable [Abstract] | ||
Allowance for doubtful accounts | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Inventory (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory [Abstract] | |
Maximum shipment period of finished goods from warehouse | 1 month |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Property, Plant and Equipment, Net (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Computer and Office Equipment [Member] | United States [Member] | Minimum [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 3 years |
Computer and Office Equipment [Member] | United States [Member] | Maximum [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 5 years |
Manufacturing Equipment [Member] | PRC [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 5 years |
Furniture and Fixtures [Member] | United States [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 5 years |
Furniture and Fixtures [Member] | PRC [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 5 years |
Transportation Equipment [Member] | PRC [Member] | Minimum [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 4 years |
Transportation Equipment [Member] | PRC [Member] | Maximum [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 5 years |
Electronic Equipment [Member] | PRC [Member] | Minimum [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 3 years |
Electronic Equipment [Member] | PRC [Member] | Maximum [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 5 years |
Leasehold Improvement [Member] | PRC [Member] | Minimum [Member] | |
Property, Plant and Equipment, Net [Abstract] | |
Useful lives | 3 years |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Intangible Assets, Net (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Software [Member] | |
Intangible Assets, Net [Abstract] | |
Intangible assets amortization period | 2 years |
Maximum [Member] | |
Intangible Assets, Net [Abstract] | |
Intangible assets amortization period, if neither the contract nor local law specifies a beneficial period | 10 years |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Shipping and Handling Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Shipping and Handling Costs [Abstract] | ||
Sales and marketing expenses | $ 11,902 | $ 9,611 |
Shipping and Handling [Member] | ||
Shipping and Handling Costs [Abstract] | ||
Sales and marketing expenses | $ 172 | $ 146 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Warranty (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Warranty Obligations [Roll Forward] | ||
Balance at beginning of period | $ 1,710 | $ 839 |
Additions | 2,105 | 1,412 |
Utilized | (1,004) | (541) |
Balance at end of period | $ 2,811 | $ 1,710 |
Minimum [Member] | ||
Warranty [Abstract] | ||
Standard product warranty period | 12 months | |
Maximum [Member] | ||
Warranty [Abstract] | ||
Standard product warranty period | 36 months |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Government Subsidies (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)Subsidy | Dec. 31, 2018USD ($) | |
Government Subsidies [Abstract] | ||
Number of subsidies awarded | Subsidy | 4 | |
Subsidies recognized as reductions of relevant expenses | $ 3,195 | $ 1,486 |
Subsidies recognized as other income | $ 147 | $ 144 |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Basic and Diluted Net Income (Loss) per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator [Abstract] | ||
Net income | $ 19,458 | $ 6,574 |
Net income attributable to redeemable non-controlling interest | 564 | 0 |
Net income available to common stockholders, basic and diluted | $ 18,894 | $ 6,574 |
Weighted average shares outstanding, basic (in shares) | 16,800,623 | 15,788,460 |
Effect of dilutive securities (in shares) | 2,334,874 | 2,123,645 |
Weighted average shares outstanding, diluted (in shares) | 19,135,497 | 17,912,105 |
Net income per common share [Abstract] | ||
Basic (in dollars per share) | $ 1.12 | $ 0.42 |
Diluted (in dollars per share) | $ 0.99 | $ 0.37 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Abstract] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 4,173,486 | 3,795,779 |
Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Abstract] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 4,095,676 | 3,715,779 |
Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Abstract] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 77,810 | 80,000 |
SUMMARY OF SIGNIFICANT ACCOU_12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Comprehensive Income (Loss) Attributable to the Company (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Comprehensive Income (Loss) Attributable to the Company [Abstract] | ||
Comprehensive income attributable to the Company | $ 18,559 | $ 5,595 |
SUMMARY OF SIGNIFICANT ACCOU_13
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Statutory Reserves (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
ACM Research (Shanghai), Inc. [Member] | ||
Statutory Reserves [Abstract] | ||
Statutory surplus reserve | $ 1,427 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOU_14
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Operating and Financial Risks (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)Customer | Dec. 31, 2018USD ($)Customer | |
Foreign Currency Risk and Translation [Abstract] | ||
Foreign currency translation adjustment | $ | $ (899) | $ (979) |
Revenue [Member] | ||
Concentration of Credit Risk [Abstract] | ||
Number of major customers | Customer | 3 | 3 |
Customer A [Member] | Revenue [Member] | ||
Concentration of Credit Risk [Abstract] | ||
Concentration of credit risk | 26.46% | 24.17% |
Customer B [Member] | Revenue [Member] | ||
Concentration of Credit Risk [Abstract] | ||
Concentration of credit risk | 19.84% | 23.83% |
Customer C [Member] | Revenue [Member] | ||
Concentration of Credit Risk [Abstract] | ||
Concentration of credit risk | 27.50% | 39.63% |
RMB [Member] | ||
Consolidated balance sheets [Abstract] | ||
Exchange rate | 6.9784 | 6.8634 |
Consolidated statements of operations and comprehensive income [Abstract] | ||
Exchange rate | 6.8966 | 6.6181 |
KRW [Member] | ||
Consolidated balance sheets [Abstract] | ||
Exchange rate | 1,156.07 | 1,114.83 |
Consolidated statements of operations and comprehensive income [Abstract] | ||
Exchange rate | 1,165.50 | 1,100.11 |
SUMMARY OF SIGNIFICANT ACCOU_15
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Recently Adopted Accounting Pronouncements (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Recent Accounting Pronouncements [Abstract] | ||
Operating lease right-of-use assets | $ 3,887 | $ 0 |
Lease liabilities | 3,887 | |
ASU 2016-02 [Member] | ||
Recent Accounting Pronouncements [Abstract] | ||
Operating lease right-of-use assets | 5,109 | |
Lease liabilities | $ 5,109 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES, Borrowing Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Capitalized Interest Costs [Abstract] | ||
Capitalized borrowing costs | $ 0 | $ 0 |
ACCOUNTS RECEIVABLE (Details)
ACCOUNTS RECEIVABLE (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts Receivable [Abstract] | ||
Accounts receivable | $ 31,091 | $ 24,608 |
Less: allowance for doubtful accounts | 0 | 0 |
Total | 31,091 | 24,608 |
Accounts receivable pledged as collateral for borrowings | $ 1,433 | $ 1,457 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory [Abstract] | ||
Raw materials | $ 15,105 | $ 12,646 |
Work in process | 10,407 | 9,631 |
Finished goods | 19,284 | 16,487 |
Total inventory, gross | 44,796 | 38,764 |
Inventory reserve | 0 | 0 |
Total inventory, net | 44,796 | 38,764 |
Inventory pledged as collateral for borrowings | $ 0 | $ 0 |
PROPERTY, PLANT AND EQUIPMENT_3
PROPERTY, PLANT AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | ||
Total cost | $ 6,095 | $ 11,778 |
Less: Total accumulated depreciation | (3,077) | (8,102) |
Construction in progress | 601 | 32 |
Total property, plant and equipment, net | 3,619 | 3,708 |
Depreciation expense | 713 | 350 |
Manufacturing equipment retired | 5,824 | |
Manufacturing Equipment [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Total cost | 3,902 | 9,703 |
Office Equipment [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Total cost | 627 | 512 |
Transportation Equipment [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Total cost | 124 | 184 |
Leasehold Improvement [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Total cost | $ 1,442 | $ 1,379 |
SHORT-TERM BORROWINGS (Details)
SHORT-TERM BORROWINGS (Details) ¥ in Thousands, $ in Thousands | Dec. 13, 2019CNY (¥) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2019CNY (¥) |
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 13,753 | $ 9,447 | ||
Short-term borrowings repaid | 14,005 | 13,131 | ||
Interest expense related to short-term borrowings | 745 | 498 | ||
Line of Credit Due on April 17, 2019 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 0 | 3,133 | ||
Maximum borrowing capacity | ¥ | ¥ 50,000 | |||
Annual interest rate | 4.99% | |||
Line of credit due date | Apr. 17, 2019 | |||
Line of Credit Due on February 14, 2019 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 0 | 485 | ||
Maximum borrowing capacity | ¥ | 50,000 | |||
Annual interest rate | 5.15% | |||
Line of credit due date | Feb. 14, 2019 | |||
Line of Credit Due on January 23, 2020 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 5,057 | 0 | ||
Maximum borrowing capacity | ¥ | 50,000 | |||
Annual interest rate | 5.22% | |||
Line of credit due date | Jan. 23, 2020 | |||
Short-term borrowings repaid | ¥ | ¥ 14,500 | |||
Line of Credit Due on June 6, 2019 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 0 | 2,186 | ||
Maximum borrowing capacity | ¥ | 30,000 | |||
Annual interest rate | 5.22% | |||
Line of credit due date | Jun. 6, 2019 | |||
Line of Credit Due on June 13, 2019 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 0 | 2,186 | ||
Maximum borrowing capacity | ¥ | 30,000 | |||
Annual interest rate | 5.22% | |||
Line of credit due date | Jun. 13, 2019 | |||
Line of Credit Due on January 23, 2019 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 0 | 1,457 | ||
Maximum borrowing capacity | ¥ | 10,000 | |||
Annual interest rate | 5.44% | |||
Line of credit due date | Jan. 23, 2019 | |||
Line of Credit Due on February 21, 2020 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 1,433 | 0 | ||
Maximum borrowing capacity | ¥ | 20,000 | |||
Annual interest rate | 5.66% | |||
Line of credit due date | Feb. 21, 2020 | |||
Line of Credit Due on January 18, 2020 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 1,433 | 0 | ||
Maximum borrowing capacity | ¥ | 20,000 | |||
Annual interest rate | 5.66% | |||
Line of credit due date | Jan. 18, 2020 | |||
Line of Credit Due on January 22, 2020 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 717 | 0 | ||
Maximum borrowing capacity | ¥ | 20,000 | |||
Annual interest rate | 5.66% | |||
Line of credit due date | Jan. 22, 2020 | |||
Line of Credit Due on February 14, 2020 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 717 | 0 | ||
Maximum borrowing capacity | ¥ | 20,000 | |||
Annual interest rate | 5.66% | |||
Line of credit due date | Feb. 14, 2020 | |||
Line of Credit Due on March 25, 2020 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 3,250 | 0 | ||
Maximum borrowing capacity | ¥ | 50,000 | |||
Annual interest rate | 4.94% | |||
Line of credit due date | Mar. 25, 2020 | |||
Line of Credit Due on April 17, 2020 [Member] | ||||
Short-Term Borrowings [Abstract] | ||||
Short-term borrowings | $ 1,146 | $ 0 | ||
Maximum borrowing capacity | ¥ | ¥ 50,000 | |||
Annual interest rate | 5.66% | |||
Line of credit due date | Apr. 17, 2020 |
OTHER PAYABLE AND ACCRUED EXP_3
OTHER PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
OTHER PAYABLE AND ACCRUED EXPENSES [Abstract] | |||
Lease expenses and payable for leasehold improvement due to a related party (note 11) | $ 0 | $ 53 | |
Accrued commissions | 4,082 | 2,931 | |
Accrued warranty | 2,811 | 1,710 | $ 839 |
Accrued payroll | 2,092 | 626 | |
Accrued professional fees | 165 | 64 | |
Accrued machine testing fees | 1,456 | 3,076 | |
Others | 2,268 | 1,950 | |
Total | $ 12,874 | $ 10,410 |
LEASES (Details)
LEASES (Details) ¥ in Thousands | Apr. 26, 2018USD ($) | Apr. 26, 2018CNY (¥) | Jan. 31, 2018Squarefeet | Dec. 31, 2019USD ($)Squarefeet | Apr. 26, 2018CNY (¥) |
Components of lease expense [Abstract] | |||||
Operating lease cost | $ 1,432,000 | ||||
Short-term lease cost | 165,000 | ||||
Lease cost | 1,597,000 | ||||
Cash paid for amounts included in the measurement of lease liabilities [Abstract] | |||||
Operating cash outflow from operating leases | 1,597,000 | ||||
Maturities of lease liabilities [Abstract] | |||||
2020 | 1,504,000 | ||||
2021 | 1,488,000 | ||||
2022 | 1,496,000 | ||||
2023 | 53,000 | ||||
2024 | 13,000 | ||||
Total lease payments | 4,554,000 | ||||
Less: Interest | (667,000) | ||||
Present value of lease liabilities | $ 3,887,000 | ||||
Weighted average remaining lease terms and discount rates [Abstract] | |||||
Weighted average remaining lease term | 3 years 7 days | ||||
Weighted average discount rate | 5.43% | ||||
ACM Shanghai [Member] | |||||
Lessee Disclosure [Abstract] | |||||
Term of lease agreement | 2 years | ||||
Area of space for office and warehouse | Squarefeet | 50,000 | 3,000 | |||
Monthly rental fee | $ 55,000 | ¥ 366 | $ 2,000 | ||
Increased base rent for April 1, 2019 to March 31, 2020 | 3,300 | ||||
Increased base rent for April 1, 2020 to March 31, 2021 | 3,400 | ||||
Security deposit amount | $ 163,000 | ¥ 1,077 | |||
ACM Wuxi [Member] | Maximum [Member] | |||||
Lessee Disclosure [Abstract] | |||||
Monthly rental fee | $ 1,000 | ||||
Shanghai Zhangjiang Group Co., Ltd. [Member] | |||||
Lessee Disclosure [Abstract] | |||||
Area of space for office and warehouse | Squarefeet | 63,510 |
OTHER LONG-TERM LIABILITIES (De
OTHER LONG-TERM LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Other Long-term Liabilities [Abstract] | ||
Other long-term liabilities | $ 4,186 | $ 4,583 |
Subsidies to Stress Free Polishing Project, Commenced in 2008 and 2017 [Member] | ||
Other Long-term Liabilities [Abstract] | ||
Other long-term liabilities | 1,251 | 1,483 |
Subsidies to Electro Copper Plating Project, Commenced in 2014 [Member] | ||
Other Long-term Liabilities [Abstract] | ||
Other long-term liabilities | 2,666 | 2,860 |
Subsidies to Polytetrafluoroethylene Project, Commenced in 2018 [Member] | ||
Other Long-term Liabilities [Abstract] | ||
Other long-term liabilities | 135 | 178 |
Other [Member] | ||
Other Long-term Liabilities [Abstract] | ||
Other long-term liabilities | $ 134 | $ 62 |
LONG-TERM INVESTMENT (Details)
LONG-TERM INVESTMENT (Details) $ / shares in Units, ¥ in Thousands, $ in Thousands | Sep. 05, 2019Investor | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2019CNY (¥) | Jun. 27, 2019USD ($) | Sep. 11, 2017USD ($)$ / sharesshares |
Investments [Abstract] | |||||||
Investment in partnership | $ 4,200 | ¥ 30,000 | |||||
Ownership percentage in partnership | 10.00% | 10.00% | |||||
Equity income in net income of affiliates | $ 168 | $ 123 | |||||
Classification of Investments [Abstract] | |||||||
Investment - equity method | 5,827 | 1,360 | |||||
Investment - cost method | 107 | 0 | |||||
Total | $ 5,934 | $ 1,360 | |||||
Ninebell [Member] | |||||||
Investments [Abstract] | |||||||
Percentage of ordinary shares issued | 20.00% | ||||||
Purchase price | $ 1,200 | ||||||
Ninebell [Member] | Class A Common Stock [Member] | |||||||
Investments [Abstract] | |||||||
Purchase price | $ 1,000 | ||||||
Shares issued (in shares) | shares | 133,334 | ||||||
Share price (in dollars per share) | $ / shares | $ 7.50 | ||||||
Shengyi [Member] | |||||||
Investments [Abstract] | |||||||
Percentage of ordinary shares issued | 15.00% | ||||||
Classification of Investments [Abstract] | |||||||
Number of investors with agreements entered | Investor | 6 | ||||||
Investment - cost method | $ 109 |
RELATED PARTY BALANCES AND TR_2
RELATED PARTY BALANCES AND TRANSACTIONS (Details) $ / shares in Units, ¥ in Thousands, $ in Thousands | Aug. 14, 2019USD ($)$ / sharesshares | Apr. 26, 2018USD ($) | Apr. 26, 2018CNY (¥) | Mar. 30, 2018USD ($)shares | Sep. 30, 2017USD ($)shares | Mar. 14, 2017USD ($)$ / sharesshares | Aug. 31, 2019USD ($)$ / sharesshares | Sep. 30, 2019USD ($)$ / sharesshares | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Apr. 26, 2018CNY (¥) | Sep. 29, 2017USD ($) | Aug. 18, 2017USD ($) | Dec. 09, 2016USD ($) | Dec. 09, 2016CNY (¥) |
Related Party Transaction [Abstract] | |||||||||||||||
Shares issued value | $ 26,435 | ||||||||||||||
Common Class A [Member] | |||||||||||||||
Related Party Transaction [Abstract] | |||||||||||||||
Shares issued (in shares) | shares | 2,053,572 | ||||||||||||||
Stock price (in dollars per share) | $ / shares | $ 14 | ||||||||||||||
ACM Shanghai [Member] | |||||||||||||||
Related Party Transaction [Abstract] | |||||||||||||||
Amount funded for leasehold improvements | $ 771 | ||||||||||||||
Monthly rental fee | $ 55 | ¥ 366 | 2 | ||||||||||||
Security deposit amount | $ 163 | ¥ 1,077 | |||||||||||||
Lease expense under lease agreement | $ 595 | $ 620 | |||||||||||||
Repayments of notes | $ 1,161 | ||||||||||||||
Ninebell Co., Ltd [Member] | |||||||||||||||
Related Party Transaction [Abstract] | |||||||||||||||
Interest-free loan to related party | $ 946 | ||||||||||||||
Loans payable period | 180 days | ||||||||||||||
Loans extended period | 180 days | ||||||||||||||
Purchased materials amount | $ 8,572 | 7,785 | |||||||||||||
Accounts payable-related party | 727 | 1,477 | |||||||||||||
Prepaid for material purchases | 348 | 572 | |||||||||||||
Shanghai Zhangjiang Group Co., Ltd. [Member] | |||||||||||||||
Related Party Transaction [Abstract] | |||||||||||||||
Lease expenses and payable for leasehold improvement due to a related party | $ 0 | $ 53 | |||||||||||||
Shanghai Zhangjiang Group Co., Ltd. [Member] | Common Class A [Member] | |||||||||||||||
Related Party Transaction [Abstract] | |||||||||||||||
Shares issued (in shares) | shares | 787,098 | ||||||||||||||
Shares issued value | $ 5,903 | ||||||||||||||
SMC [Member] | |||||||||||||||
Related Party Transaction [Abstract] | |||||||||||||||
Cash delivered as of the close of business | $ 2,981 | ¥ 20,124 | |||||||||||||
Stock price (in dollars per share) | $ / shares | $ 13.195 | ||||||||||||||
Investment repayment period | 60 days | ||||||||||||||
Repayments of notes | $ 882 | ||||||||||||||
Number of shares repurchased/surrender in exchange (in shares) | shares | 154,821 | ||||||||||||||
SMC [Member] | Senior Secured Promissory Note [Member] | |||||||||||||||
Related Party Transaction [Abstract] | |||||||||||||||
Promissory note principal amount | $ 2,981 | ||||||||||||||
Interest rate on promissory note | 3.01% | ||||||||||||||
Promissory note maturity date | Aug. 17, 2023 | ||||||||||||||
SMC [Member] | Common Class A [Member] | |||||||||||||||
Related Party Transaction [Abstract] | |||||||||||||||
Shares issued (in shares) | shares | 397,502 | ||||||||||||||
Shares issued value | $ 2,981 | ||||||||||||||
Stock price (in dollars per share) | $ / shares | $ 13.195 | $ 7.50 | |||||||||||||
Exercise of common stock warrant issued (in shares) | shares | 397,502 | ||||||||||||||
Number of shares repurchased/surrender in exchange (in shares) | shares | 214,286 | ||||||||||||||
Cancellation of options to acquire shares (in shares) | shares | 53,571 | ||||||||||||||
Cancellation of options to acquire stock, amount | $ 3,403 | ||||||||||||||
Shengyi [Member] | |||||||||||||||
Related Party Transaction [Abstract] | |||||||||||||||
Purchased materials amount | $ 856 | ||||||||||||||
Accounts payable-related party | $ 488 |
COMMON STOCK (Details)
COMMON STOCK (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 14, 2019 | Mar. 30, 2018 | Mar. 14, 2017 | Aug. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Class of Stock [Abstract] | |||||||
Net proceeds from issuance of stock | $ 26,434 | $ 0 | |||||
Conversion of class B common shares to Class A common shares (in shares) | 35,815 | ||||||
SMC [Member] | |||||||
Class of Stock [Abstract] | |||||||
Stock price (in dollars per share) | $ 13.195 | ||||||
Number of shares repurchased (in shares) | 154,821 | ||||||
Common Class A [Member] | |||||||
Class of Stock [Abstract] | |||||||
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 | |||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |||||
Number of votes for each share entitled | 1 | ||||||
Number of shares issued (in shares) | 2,053,572 | ||||||
Stock price (in dollars per share) | $ 14 | ||||||
Net proceeds from issuance of stock | $ 28,750 | ||||||
Underwriting discount and offering expenses | $ 2,287 | ||||||
Common stock, shares issued (in shares) | 16,182,151 | 14,110,315 | |||||
Common stock, shares outstanding (in shares) | 16,182,151 | 14,110,315 | |||||
Common Class A [Member] | SMC [Member] | |||||||
Class of Stock [Abstract] | |||||||
Exercise of common stock warrant issued (in shares) | 397,502 | ||||||
Number of shares issued (in shares) | 397,502 | ||||||
Stock price (in dollars per share) | $ 13.195 | $ 7.50 | |||||
Number of shares repurchased (in shares) | 214,286 | ||||||
Common Class B [Member] | |||||||
Class of Stock [Abstract] | |||||||
Common stock, shares authorized (in shares) | 2,409,738 | 2,409,738 | |||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |||||
Number of votes for each share entitled | 20 | ||||||
Convertible shares in to Class A common stock (in shares) | 1 | ||||||
Common stock, shares issued (in shares) | 1,862,608 | 1,898,423 | |||||
Common stock, shares outstanding (in shares) | 1,862,608 | 1,898,423 | |||||
Common Stock [Member] | Common Class A [Member] | |||||||
Class of Stock [Abstract] | |||||||
Exercise of common stock warrant issued (in shares) | 1,438 | 397,502 | |||||
Stock issued upon exercise of stock options (in shares) | 195,297 | 265,952 | |||||
Number of shares issued (in shares) | 2,053,572 | ||||||
Number of shares repurchased (in shares) | 214,286 | ||||||
Conversion of class B common shares to Class A common shares (in shares) | 35,815 | 511,315 | |||||
Common Stock [Member] | Common Class B [Member] | |||||||
Class of Stock [Abstract] | |||||||
Exercise of common stock warrant issued (in shares) | 0 | 0 | |||||
Stock issued upon exercise of stock options (in shares) | 0 | 0 | |||||
Number of shares issued (in shares) | 0 | ||||||
Conversion of class B common shares to Class A common shares (in shares) | (35,815) | (511,315) |
REDEEMABLE NON-CONTROLLING IN_3
REDEEMABLE NON-CONTROLLING INTERESTS (Details) $ in Thousands | Jun. 12, 2019 | Dec. 31, 2019USD ($) | Sep. 30, 2019Investor | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Change in Redeemable Noncontrolling Interests [Abstract] | |||||
Balance | $ 0 | ||||
Net income attributable to redeemable non-controlling interests | 564 | $ 0 | |||
Effect of foreign currency translation loss attributable to redeemable non-controlling interests | (81) | ||||
Balance | $ 60,162 | 60,162 | $ 0 | ||
Tranche 1 [Member] | |||||
Change in Redeemable Noncontrolling Interests [Abstract] | |||||
Increase in redeemable non-controlling interests due to issuance of common stock | 27,264 | ||||
Tranche 2 [Member] | |||||
Change in Redeemable Noncontrolling Interests [Abstract] | |||||
Increase in redeemable non-controlling interests due to issuance of common stock | $ 32,415 | ||||
ACM Shanghai [Member] | |||||
Redeemable Noncontrolling Interest [Abstract] | |||||
Percentage of redeemable non-controlling interest issued | 91.70% | ||||
ACM Shanghai [Member] | Tranche 1 [Member] | |||||
Redeemable Noncontrolling Interest [Abstract] | |||||
Percentage of outstanding shares issued | 4.20% | 4.20% | |||
Number of investors owned by employees entities | Investor | 2 | ||||
Percentage of discount on purchase price for employee entities | 20.00% | ||||
Term of supplemental agreement | 3 years | ||||
Percentage of redeemable non-controlling interest issued | 3.80% | ||||
ACM Shanghai [Member] | Tranche 2 [Member] | |||||
Redeemable Noncontrolling Interest [Abstract] | |||||
Percentage of redeemable non-controlling interest issued | 4.50% |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 28, 2016 | Apr. 29, 1998 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Aug. 31, 2019 | |
Class A Common Stock [Member] | |||||||
Fair Value of Option Granted [Abstract] | |||||||
Fair value of common share (in dollars per share) | $ 14 | ||||||
Employee Share Option [Member] | |||||||
Number of Option Share [Roll Forward] | |||||||
Outstanding, beginning of period (in shares) | 2,503,405 | 2,045,616 | |||||
Granted (in shares) | 656,000 | 745,700 | |||||
Exercised (in shares) | (106,768) | (151,650) | |||||
Expired (in shares) | (2,757) | (4,622) | |||||
Forfeited/cancelled (in shares) | (55,817) | (131,639) | |||||
Outstanding, end of period (in shares) | 2,994,063 | 2,503,405 | 2,045,616 | ||||
Vested and exercisable (in shares) | 1,773,048 | ||||||
Weighted Average Grant Date Fair Value [Abstract] | |||||||
Outstanding at beginning of period (in dollars per share) | $ 0.91 | $ 0.66 | |||||
Granted (in dollars per share) | 6.29 | 1.52 | |||||
Exercised (in dollars per share) | 0.60 | 0.53 | |||||
Expired (in dollars per share) | 3.34 | 0.55 | |||||
Forfeited/cancelled (in dollars per share) | 2.38 | 0.97 | |||||
Outstanding at end of period (in dollars per share) | 2.59 | 0.91 | $ 0.66 | ||||
Weighted Average Exercise Price [Abstract] | |||||||
Outstanding, beginning of period (in dollars per share) | 4.09 | 2.46 | |||||
Granted (in dollars per share) | 16.21 | 8.12 | |||||
Exercised (in dollars per share) | 2.09 | 2.06 | |||||
Expired (in dollars per share) | 8.16 | 3 | |||||
Forfeited/cancelled (in dollars per share) | 6.23 | 3.87 | |||||
Outstanding, end of period (in dollars per share) | $ 6.77 | $ 4.09 | $ 2.46 | ||||
Weighed Average Remaining Contractual Term [Abstract] | |||||||
Outstanding weighed average remaining contractual term | 7 years 18 days | 7 years 3 months 18 days | 7 years 6 months 25 days | ||||
Stock-based compensation expense | $ 2,265 | $ 712 | |||||
Unrecognized employee stock-based compensation expense | $ 4,712 | $ 2,424 | |||||
Weighted-average period over which unrecognized compensation is expected to be recognized | 1 year 5 months 19 days | 1 year 7 months 13 days | |||||
Fair Value of Option Granted [Abstract] | |||||||
Expected term in years | [1] | 6 years 3 months | 6 years 3 months | ||||
Expected dividend | [2] | 0.00% | 0.00% | ||||
Employee Share Option [Member] | Minimum [Member] | |||||||
Fair Value of Option Granted [Abstract] | |||||||
Fair value of common share (in dollars per share) | [3] | $ 13.64 | $ 5.31 | ||||
Volatility | [4] | 39.91% | 39.14% | ||||
Risk-free interest rate | [5] | 1.69% | 2.55% | ||||
Employee Share Option [Member] | Maximum [Member] | |||||||
Fair Value of Option Granted [Abstract] | |||||||
Fair value of common share (in dollars per share) | [3] | $ 16.81 | $ 13.85 | ||||
Volatility | [4] | 40.35% | 43.00% | ||||
Risk-free interest rate | [5] | 2.46% | 2.96% | ||||
Employee Share Option [Member] | ACM Shanghai [Member] | |||||||
Weighed Average Remaining Contractual Term [Abstract] | |||||||
Percentage of discount on purchase price for employee entities | 20.00% | ||||||
Stock-based compensation expense | $ 949 | ||||||
Employee Share Option [Member] | ACM Shanghai [Member] | Cost of Revenue [Member] | |||||||
Weighed Average Remaining Contractual Term [Abstract] | |||||||
Stock-based compensation expense | 119 | ||||||
Employee Share Option [Member] | ACM Shanghai [Member] | Sales and Marketing Expenses [Member] | |||||||
Weighed Average Remaining Contractual Term [Abstract] | |||||||
Stock-based compensation expense | 111 | ||||||
Employee Share Option [Member] | ACM Shanghai [Member] | Research and Development Expenses [Member] | |||||||
Weighed Average Remaining Contractual Term [Abstract] | |||||||
Stock-based compensation expense | 625 | ||||||
Employee Share Option [Member] | ACM Shanghai [Member] | General and Administrative Expenses [Member] | |||||||
Weighed Average Remaining Contractual Term [Abstract] | |||||||
Stock-based compensation expense | $ 94 | ||||||
Non-Employee Share Option [Member] | |||||||
Number of Option Share [Roll Forward] | |||||||
Outstanding, beginning of period (in shares) | 1,212,374 | 1,326,676 | |||||
Granted (in shares) | 0 | 0 | |||||
Exercised (in shares) | (88,529) | (114,302) | |||||
Expired (in shares) | 0 | 0 | |||||
Forfeited/cancelled (in shares) | (22,232) | 0 | |||||
Outstanding, end of period (in shares) | 1,101,613 | 1,212,374 | 1,326,676 | ||||
Vested and exercisable (in shares) | 1,024,017 | ||||||
Weighted Average Grant Date Fair Value [Abstract] | |||||||
Outstanding at beginning of period (in dollars per share) | $ 0.78 | $ 0.78 | |||||
Granted (in dollars per share) | 0 | 0 | |||||
Exercised (in dollars per share) | 0.45 | 0.43 | |||||
Expired (in dollars per share) | 0 | 0 | |||||
Forfeited/cancelled (in dollars per share) | 0.55 | 0 | |||||
Outstanding at end of period (in dollars per share) | 0.82 | 0.78 | $ 0.78 | ||||
Weighted Average Exercise Price [Abstract] | |||||||
Outstanding, beginning of period (in dollars per share) | 2.57 | 2.52 | |||||
Granted (in dollars per share) | 0 | 0 | |||||
Exercised (in dollars per share) | 1.06 | 1.92 | |||||
Expired (in dollars per share) | 0 | 0 | |||||
Forfeited/cancelled (in dollars per share) | 3 | 0 | |||||
Outstanding, end of period (in dollars per share) | $ 2.69 | $ 2.57 | $ 2.52 | ||||
Weighed Average Remaining Contractual Term [Abstract] | |||||||
Outstanding weighed average remaining contractual term | 5 years 10 months 6 days | 6 years 7 months 28 days | 7 years 6 months 14 days | ||||
Stock-based compensation expense | $ 1,307 | $ 2,651 | |||||
Unrecognized employee stock-based compensation expense | $ 406 | $ 1,713 | |||||
Weighted-average period over which unrecognized compensation is expected to be recognized | 2 months 23 days | 1 year 3 months 22 days | |||||
Non-Employee Share Option [Member] | Class A Common Stock [Member] | |||||||
Number of Option Share [Roll Forward] | |||||||
Outstanding, beginning of period (in shares) | 3,715,779 | ||||||
Outstanding, end of period (in shares) | 4,095,676 | 3,715,779 | |||||
Fair Value of Option Granted [Abstract] | |||||||
Outstanding stock options intrinsic value | $ 52,300 | $ 27,100 | |||||
Options vested (in shares) | 2,797,062 | 2,273,880 | |||||
Options vested intrinsic value | $ 43,400 | $ 20,000 | |||||
Options unvested (in shares) | 1,298,614 | 1,441,899 | |||||
Options unvested intrinsic value | $ 8,900 | $ 7,100 | |||||
Non-Employee Share Option [Member] | Class A Common Stock [Member] | Director [Member] | |||||||
Number of Option Share [Roll Forward] | |||||||
Forfeited/cancelled (in shares) | (22,232) | ||||||
1998 Stock Option Plan [Member] | |||||||
Stock-Based Compensation [Abstract] | |||||||
Shares of common stock reserved for issuance (in shares) | 766,667 | ||||||
1998 Stock Option Plan [Member] | Incentive Stock options [Member] | Maximum [Member] | |||||||
Stock-Based Compensation [Abstract] | |||||||
Option price at the time of grant, fair market value of stock price percentage | 100.00% | ||||||
1998 Stock Option Plan [Member] | Nonstatutory Stock Options [Member] | Maximum [Member] | |||||||
Stock-Based Compensation [Abstract] | |||||||
Option price at the time of grant, fair market value of stock price percentage | 85.00% | ||||||
2016 Omnibus Incentive Plan [Member] | Class A Common Stock [Member] | |||||||
Stock-Based Compensation [Abstract] | |||||||
Shares outstanding immediate preceding year, percentage | 4.00% | ||||||
2016 Omnibus Incentive Plan [Member] | Class A Common Stock [Member] | Maximum [Member] | |||||||
Stock-Based Compensation [Abstract] | |||||||
Shares of common stock reserved for issuance (in shares) | 2,333,334 | ||||||
2016 Omnibus Incentive Plan [Member] | Class B Common Stock [Member] | |||||||
Stock-Based Compensation [Abstract] | |||||||
Shares outstanding immediate preceding year, percentage | 4.00% | ||||||
2016 Omnibus Incentive Plan [Member] | Incentive Stock options [Member] | |||||||
Stock-Based Compensation [Abstract] | |||||||
Shares of common stock reserved for issuance (in shares) | 2,333,334 | ||||||
[1] | Expected term of share options is based on the average of the vesting period and the contractual term for each grant according to Staff Accounting Bulletin 110. | ||||||
[2] | Expected dividend is assumed to be 0% as ACM has no history or expectation of paying a dividend on its common stock. | ||||||
[3] | Common stock value was the close market value on the grant date. | ||||||
[4] | Volatility is calculated based on the historical volatility of ACM's comparable companies in the period equal to the expected term of each grant. | ||||||
[5] | Risk-free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of the share options in effect at the time of grant. |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current [Abstract] | |||
U.S. federal | $ 0 | $ 0 | |
U.S. state | 0 | 0 | |
Foreign | (3,176) | (1,149) | |
Total current tax expense | (3,176) | (1,149) | |
Deferred [Abstract] | |||
U.S. federal | 3,728 | 0 | |
U.S. state | 0 | 0 | |
Foreign | (34) | 343 | |
Total deferred tax benefit | 3,694 | 343 | |
Total income tax benefit (expense) | 518 | (806) | |
Deferred Tax Assets [Abstract] | |||
Net operating loss carry forwards (offshore) | 216 | 16 | |
Net operating loss carry forwards (U.S.) and credit | 3,218 | 4,105 | |
Deferred revenue (offshore) | 1,181 | 558 | |
Accruals (U.S.) | 15 | 11 | |
Reserves and other (offshore) | 426 | 1,080 | |
Stock-based compensation (U.S.) | 1,168 | 1,021 | |
Property and equipment (U.S.) | 3 | 1 | |
Total gross deferred tax assets | 6,227 | 6,792 | |
Less: valuation allowance | (896) | (5,155) | |
Total deferred tax assets | 5,331 | 1,637 | |
Total deferred tax liabilities | 0 | 0 | |
Translation difference | 0 | 0 | |
Deferred tax assets, net | 5,331 | $ 1,637 | |
Income Taxes [Abstract] | |||
One-time benefit of deferred tax asset | $ (4,033) | ||
Net operating loss carryforwards subject to annual limitation ownership change | $ 12 | ||
Effective Tax Rate Reconciliation [Abstract] | |||
Income tax provision at statutory rate | 21.00% | 21.00% | |
Foreign rate differential | (12.26%) | (20.88%) | |
Other permanent difference | 8.71% | 15.59% | |
Change in valuation allowance | (20.19%) | (4.78%) | |
Total income tax expense (benefit) | (2.74%) | 10.93% | |
Aggregate Changes in Balance of Gross Unrecognized Tax Benefits [Abstract] | |||
Beginning balance | $ 44 | $ 44 | |
Increase/ (decrease) of unrecognized tax benefits taken in prior years | 0 | 0 | |
Increase/ (decrease) of unrecognized tax benefits related to current year | 0 | 0 | |
Increase/ (decrease) of unrecognized tax benefits related to settlements | 0 | 0 | |
Reductions to unrecognized tax benefits related to lapsing statute of limitations | 0 | 0 | |
Ending balance | 44 | 44 | |
Accrued penalties | 44 | 44 | |
U.S. Federal [Member] | |||
Income Taxes [Abstract] | |||
Increase (decrease) in valuation allowance | (4,465) | (278) | |
Net operating loss carry-forwards | $ 12,158 | 15,867 | |
Operating loss carry-forwards, expiration date | Dec. 31, 2023 | ||
Research credit carry-forwards | $ 479 | 606 | |
Tax credit carry-forwards, expiration date | Dec. 31, 2025 | ||
U.S. State [Member] | |||
Income Taxes [Abstract] | |||
Net operating loss carry-forwards | $ 634 | 714 | |
Operating loss carry-forwards, expiration date | Dec. 31, 2032 | ||
Research credit carry-forwards | $ 377 | 377 | |
China [Member] | |||
Income Taxes [Abstract] | |||
Increase (decrease) in valuation allowance | 207 | 2 | |
Net operating loss carry-forwards | $ 66 | $ 66 | |
Operating loss carry-forwards, expiration date | Dec. 31, 2019 | ||
Effective period of preferential income tax rate | 3 years | ||
China [Member] | Minimum [Member] | |||
Income Taxes [Abstract] | |||
Foreign corporate tax rate | 15.00% | ||
China [Member] | Maximum [Member] | |||
Income Taxes [Abstract] | |||
Foreign corporate tax rate | 25.00% |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) | 12 Months Ended |
Dec. 31, 2019Segment | |
SEGMENT INFORMATION [Abstract] | |
Number of reporting segments | 1 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | Dec. 31, 2019USD ($) |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
Commitments | $ 431 |
RESTRICTED NET ASSETS (Details)
RESTRICTED NET ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
RESTRICTED NET ASSETS [Abstract] | ||
Amounts restricted included paid-in capital and statutory reserve funds | $ 113,168 | $ 32,076 |
PARENT COMPANY ONLY CONDENSED_3
PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION, Condensed Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets [Abstract] | ||
Cash and cash equivalents | $ 58,261 | $ 27,124 |
Accounts Receivable | 31,091 | 24,608 |
Inventory | 44,796 | 38,764 |
Other receivable | 2,603 | 3,547 |
Total current assets | 198,396 | 96,028 |
Total assets | 217,703 | 103,047 |
Liabilities and Stockholders' Equity [Abstract] | ||
Income taxes payable | 3,129 | 1,193 |
Total liabilities | 60,220 | 50,723 |
Total stockholders' equity | 97,321 | 52,324 |
Total liabilities, redeemable non-controlling interests, and stockholders' equity | 217,703 | 103,047 |
Parent Company [Member] | ||
Current assets [Abstract] | ||
Cash and cash equivalents | 27,733 | 13,161 |
Accounts Receivable | 0 | 983 |
Inventory | 444 | 720 |
Due from intercompany | 4,542 | 14,494 |
Other receivable | 5 | 175 |
Total current assets | 32,724 | 29,533 |
Investment in unconsolidated subsidiaries | 68,527 | 26,861 |
Total assets | 101,251 | 56,394 |
Liabilities and Stockholders' Equity [Abstract] | ||
Accounts payable | 1,138 | 2,818 |
Other payable | 589 | 58 |
Income taxes payable | 3,129 | 1,193 |
Total liabilities | 4,856 | 4,069 |
Total stockholders' equity | 96,395 | 52,325 |
Total liabilities, redeemable non-controlling interests, and stockholders' equity | $ 101,251 | $ 56,394 |
PARENT COMPANY ONLY CONDENSED_4
PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION, Condensed Statement of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | ||
Revenue | $ 107,524 | $ 74,643 |
Cost of revenue | (56,870) | (40,194) |
Gross profit | 50,654 | 34,449 |
Operating expenses [Abstract] | ||
Sales and marketing expenses | (11,902) | (9,611) |
General and administrative expenses | (8,061) | (7,987) |
Research and development expenses | (12,900) | (10,380) |
Income from operations | 17,791 | 6,471 |
Equity in earnings of unconsolidated subsidiaries | 168 | 123 |
Interest income, net | 333 | 29 |
Interest expense, net | (745) | (498) |
Income before income taxes | 18,940 | 7,380 |
Income tax expense | (518) | 806 |
Net income available to common stockholders, basic and diluted | 18,894 | 6,574 |
Parent Company [Member] | ||
Income Statement [Abstract] | ||
Revenue | 10,683 | 25,506 |
Cost of revenue | (10,036) | (23,927) |
Gross profit | 647 | 1,579 |
Operating expenses [Abstract] | ||
Sales and marketing expenses | (490) | (301) |
General and administrative expenses | (3,639) | (5,083) |
Research and development expenses | (476) | (255) |
Income from operations | (3,958) | (4,060) |
Equity in earnings of unconsolidated subsidiaries | 22,510 | 10,360 |
Interest income, net | 231 | 166 |
Interest expense, net | (67) | 0 |
Non-operating income (expense), net | 178 | 108 |
Income before income taxes | 18,894 | 6,574 |
Income tax expense | 0 | 0 |
Net income available to common stockholders, basic and diluted | $ 18,894 | $ 6,574 |
PARENT COMPANY ONLY CONDENSED_5
PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION, Condensed Statement of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Cash Flows [Abstract] | ||
Net cash used in operating activities | $ 9,403 | $ 6,909 |
Net cash provided by investing activities | (5,531) | (2,071) |
Net cash provided by financing activities | 87,445 | 5,123 |
Net increase in cash, cash equivalents and restricted cash | 90,735 | 9,443 |
Cash, cash equivalents and restricted cash at beginning of period | 27,124 | 17,681 |
Effect of exchange rate changes on cash and cash equivalents | (582) | (518) |
Cash, cash equivalents and restricted cash at end of period | 117,859 | 27,124 |
Parent Company [Member] | ||
Statement of Cash Flows [Abstract] | ||
Net cash used in operating activities | (7,957) | (1,189) |
Net cash provided by investing activities | 0 | 946 |
Net cash provided by financing activities | 23,347 | 3,510 |
Net increase in cash, cash equivalents and restricted cash | 15,390 | 3,267 |
Cash, cash equivalents and restricted cash at beginning of period | 13,161 | 10,874 |
Effect of exchange rate changes on cash and cash equivalents | (818) | (980) |
Cash, cash equivalents and restricted cash at end of period | $ 27,733 | $ 13,161 |