Apyx Medical (APYX) 10-Q/A 8 May 20 2019 Q1 Quarterly report (amended) Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 03, 2019
Document And Entity Information
Entity Registrant Name	APYX MEDICAL CORP
Entity Central Index Key	0000719135
Document Type	10-Q/A
Document Period End Date	Mar. 31, 2019
Amendment Flag	true
Amendment Description	Explanatory Note As disclosed in Item 4.02 of Form 8-K filed with the U.S Securities and Exchange Commission ("SEC") on March 16, 2020, on March 12, 2020 the Audit Committee of the Board of Directors of Apyx Medical Corporation (formerly known as Bovie Medical Corporation) (the “Company”) concluded, after review and discussion with management, that the Company’s financial statements as of and for the three months ended March 31, 2019 ( the “Financial Statements”) should no longer be relied upon. Amendment No. 1 on Form 10-Q/A (this “Form 10-Q/A") amends and restates certain items noted below in the Quarterly Report on Form 10-Q of the Company for the quarter ended March 31, 2019, as originally filed with the Securities and Exchange Commission on May 8, 2019 (the “Original Filing”). This Form 10-Q/A amends the Original Filing to reflect the correction of an error in the previously reported financial statements related to the Company’s failure to properly collect and remit employee income and payroll taxes, and remit the employer portion of payroll taxes, resulting from the exercise of non-qualified stock options. In addition, the Company has also corrected other minor items primarily related to the appropriate cutoff of transactions at the balance sheet date and the duplicate recording of a State income tax payment, and has corrected its cost of sales and other operating expenses as a result of reevaluating its subsidiary consolidation process and discovering an inaccuracy in its accounting for the elimination of markup on intercompany sales. As previously disclosed and adjusted in Form 10-Q for the three and nine months ended September 2019 filed on November 11, 2019, the Company reevaluated its accounting for stock-based compensation expense and during the three months ended September 30, 2019, the Company discovered errors in its accounting for certain items included in stock-based compensation expense. These errors related to its accounting for forfeitures, the vesting periods over which the expense was recognized, modifications, fair value measurements, and other minor miscellaneous items, all of which relate to the prior year. Additionally, the Company identified an issue relating to grants in the first quarter of 2019, whereby compensation was not recognized over the correct vesting period. The Company also re-evaluated its accounting for pre-development activities on certain OEM contracts determined that it had not completed its performance obligations on its pre-development activities in these contracts. Accordingly, the Company determined that it had prematurely recognized revenues during the first quarter of 2019 relating to these activities and did not defer the accompanying costs. See Note 2 to the Condensed Consolidated Financial Statements included in Item 1 for additional information and a reconciliation of the previously reported amounts to the restated amounts. For the convenience of the reader, this form 10-Q/A sets forth the Original Filing, as amended, in its entirety; however, this Form 10-Q/A amends and restates only the following financial statements and disclosures that were impacted from the correction of the errors: Part I, Item 1 - Financial Statements Part I, Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations Part II, Item 6 - Exhibits Signatures The Company’s Chief Executive Officer and Chief Financial Officer have provided new certifications dated as of the date of this filing in connection with this Form 10-Q/A(Exhibits 31.1, 31.2, 32.1 and 32.2),and the Company has provided its revised audited consolidated financial statements formatted in Extensible Business Reporting Language (XBRL) in Exhibit 101. Except as described above, no other changes have been made to the Original Filing. This Form 10-Q/A speaks as of the date of the Original Filing and does not reflect events that may have occurred after the date of the Original Filing, or modify or update any disclosures that may have been affected by subsequent events. The Company is also concurrently filing an amended Quarterly Report for the three and nine months ended September 31, 2018 to restate their previously issued interim financial statements due to several of the same accounting errors described above.
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		34,041,830
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Small Business	true
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2019

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018	Mar. 31, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 32,415	$ 16,596
Short term investments	40,885	61,678
Trade accounts receivable, net of allowance of $196 and $428	4,969	5,080
Inventories, net of provision for obsolescence of $398 and $439	5,598	5,297
Prepaid expenses and other current assets	1,449	1,184
Total current assets	85,316	89,835
Property and equipment, net	6,031	5,788
Intangibles	190	191
Deposits	80	73
Other assets	239	41
Total assets	91,856	95,928
Current liabilities:
Accounts payable	1,504	1,423
Accrued and other liabilities	5,587	5,865
Joint and several payroll liability	1,014	713
Accrued severance and related	511	610
Total current liabilities	8,616	8,611
Note payable	140	140
Long term lease liability	75
Other long-term liabilities	194	0
Total liabilities	9,025	8,751
STOCKHOLDERS’ EQUITY
Common stock, $0.001 par value; 75,000,000 shares authorized; 34,033,255 issued and 33,891,255 outstanding as of March 31, 2019 and 33,847,100 issued and 33,704,525 outstanding as of December 31, 2018	34	34
Additional paid-in capital	54,182	52,920
Retained earnings	28,615	34,223
Total stockholders’ equity	82,831	87,177	$ 21,469	$ 22,032
Total liabilities and stockholders’ equity	$ 91,856	$ 95,928

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Allowance for doubtful accounts receivable	$ 196	$ 428
Provision for obsolescence, inventory	$ 398	$ 439
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	75,000,000	75,000,000
Common stock, shares issued (in shares)	34,033,255	33,847,100
Common stock, shares outstanding (in shares)	33,891,255	33,704,525

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Statement [Abstract]
Sales	$ 5,629	$ 3,397
Cost of sales	2,066	1,185
Gross profit	3,563	2,212
Other costs and expenses:
Research and development	730	514
Professional services	2,118	506
Salaries and related costs	3,488	1,802
Selling, general and administrative	2,957	2,110
Total other costs and expenses	9,293	4,932
Loss from operations	(5,730)	(2,720)
Interest income	423	0
Interest expense	0	(34)
Other losses	(295)	0
Change in value of derivative liabilities	0	(26)
Total other income (expense), net	128	(60)
Loss before income taxes	(5,602)	(2,780)
Income tax expense	6	11
Loss from continuing operations	(5,608)	(2,791)
Income from discontinued operations, net of tax	0	1,856
Loss from continuing operations	$ (5,608)	$ (935)
EPS from continuing operations:
Basic (in dollars per share)	$ (0.17)	$ (0.08)
Diluted (in dollars per share)	(0.17)	(0.08)
EPS from discontinued operations:
Basic (in dollars per share)	0	0.05
Diluted (in dollars per share)	0	0.05
EPS from total operations:
Basic (in dollars per share)	(0.17)	(0.03)
Diluted (in dollars per share)	$ (0.17)	$ (0.03)

CONSOLIDATED STATEMENT OF CHANG

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Retained Earnings (Accumulated deficit)
Beginning balance (in shares) at Dec. 31, 2017		32,878,000
Beginning balance, amount at Dec. 31, 2017	$ 22,032	$ 33	$ 50,495	$ (28,496)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation - as Restated	372		372
Net loss	(935)			(935)
Ending balance (in shares) at Mar. 31, 2018		32,878,000
Ending balance, amount at Mar. 31, 2018	21,469	$ 33	50,867	(29,431)
Beginning balance (in shares) at Dec. 31, 2018		33,705,000
Beginning balance, amount at Dec. 31, 2018	87,177	$ 34	52,920	34,223
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Options exercised (in shares)		271,000
Options exercised	777		777
Stock based compensation - as Restated	1,195		1,195
Stock exercise to acquire options and warrants (in shares)		(85,000)
Stock exercise to acquire options and warrants	(710)		(710)
Net loss	(5,608)			(5,608)
Ending balance (in shares) at Mar. 31, 2019		33,891,000
Ending balance, amount at Mar. 31, 2019	$ 82,831	$ 34	$ 54,182	$ 28,615

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Cash flows from operating activities
Net loss	$ (5,608)	$ (935)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	194	199
Provision for inventory obsolescence	41	(47)
Stock based compensation	1,195	372
Change in fair value of derivative liabilities	0	26
Unrealized gain on short term investments	(164)	0
Provision (benefit) for allowance for doubtful accounts	(238)	(9)
Changes in current assets and liabilities:
Trade receivables	349	(277)
Prepaid expenses	(265)	(26)
Inventories	(342)	(136)
Deposits and other assets	(346)	4
Accounts payable	81	514
Accrued severance and related	(99)	0
Accrued expenses and other liabilities	113	(793)
Net cash used in operating activities	(5,089)	(1,108)
Cash flows from investing activities
Purchases of property and equipment	(117)	(139)
Purchases of marketable securities	(18,884)	0
Proceeds of marketable securities	39,842	0
Net cash provided by (used in) investing activities	20,841	(139)
Cash flows from financing activities
Proceeds from stock options exercised	67	0
Repayment of mortgage note payable	0	(60)
Net cash provided by (used in) financing activities	67	(60)
Net change in cash, cash equivalents and restricted cash	15,819	(1,307)
Cash, cash equivalents and restricted cash, beginning of period	16,596	10,668
Cash, cash equivalents and restricted cash, end of period	32,415	9,361
Cash paid for:
Interest expense	0	34
Non cash investing activities:
Cashless exercise of stock options/warrants	710	0
Capitalization of Lease	$ 178	$ 0

BASIS OF PRESENTATION

BASIS OF PRESENTATION	3 Months Ended
	Mar. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BASIS OF PRESENTATION	BASIS OF PRESENTATION Unless the context otherwise indicates, the terms “we,” “our,” “us,” “Apyx,” "Company" and similar terms refer to Apyx Medical Corporation and its consolidated subsidiaries. We are a medical technology company and the developer of J-Plasma® (marketed and sold under the Renuvion™ Cosmetic Technology brand in the cosmetic surgery market), a patented plasma-based surgical product for cutting, coagulation and ablation of soft tissue. J-Plasma technology utilizes a helium ionization process to produce a stable, focused beam of plasma that provides surgeons with greater precision and minimal invasiveness. The Company also leverages its expertise through original equipment manufacturing (OEM) agreements with other medical device manufacturers. On August 30, 2018, we closed on a definitive asset purchase agreement with Specialty Surgical Instrumentation Inc., a Tennessee Corporation and wholly-owned subsidiary of Symmetry Surgical Inc. (“Symmetry”), pursuant to which we divested and sold our electrosurgical "Core" business segment and related intellectual property, including the Bovie® brand and trademarks, to Symmetry for gross proceeds of $97 million in cash. The divestiture and sale of our Core business segment to Symmetry allows us to further focus on our strategic objective of commercializing our J-Plasma technology, including the RenuvionTM brand in the cosmetic surgery market. We also entered into with Symmetry a transition services agreement, a Patent Licensing Agreement, a Disposables Supply Agreement, and a Generator Manufacturing and Supply Agreement, the latter of which will establish us as an OEM-provider of generators to Symmetry for a period of at least 10 years . For the three months ended March 31, 2018, the Core sales amounted to $6.5 million with cost of sales of $3.7 million and related operating expenses of $0.9 million , which are included in income from discontinued operations on the Consolidated Statement of Operations. In connection with the asset purchase agreement, we also entered into an Electro Surgical Disposables and Accessories, Cauteries and Other Products Supply Agreement with Symmetry for up to a four -year term, whereby we will manufacture certain Core products and sell them to Symmetry at agreed upon prices. Any revenue, costs and expenses resulting from this agreement are netted and reported in our Consolidated Statements of Operations as Other gains or losses. For the three months ended March 31, 2019, Core sales following the divestiture amounted to $2.2 million with cost of sales of $2.1 million and related operating expenses of $0.1 million , which are included in other losses on the Consolidated Statement of Operations. In connection with the asset purchase agreement, we also entered into a Manufacture and Supply Agreement with Symmetry for a ten -year term, whereby we will manufacture certain products and sell them to Symmetry at agreed upon prices. Revenue, costs and expenses resulting from this agreement are reported in our Consolidated Statements as income or loss from operations of our OEM reporting segment. We reclassified the financial results of the Core business to discontinued operations and from segment results for all periods presented. The accompanying unaudited consolidated financial statements have been prepared based upon SEC rules that permit reduced disclosure for interim periods. For a more complete discussion of significant accounting policies and certain other information, please refer to the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018. These financial statements reflect all adjustments that are necessary for a fair presentation of results of operations and financial condition for the interim periods shown, including normal recurring accruals and other items. The results for the interim periods are not necessarily indicative of results for the full year.

RESTATEMENT

RESTATEMENT	3 Months Ended
	Mar. 31, 2019
Accounting Changes and Error Corrections [Abstract]
Restatement	RESTATEMENT Throughout 2019, the Company made efforts to remediate its material weaknesses in internal control as of December 31, 2018, including investing in new personnel that have expertise in a broad array of accounting topics. As a result of these investments and remediation efforts, the Company reevaluated the accounting for a broad array of items and discovered numerous immaterial errors. On March 12, 2020, our Management and the Audit Committee of the Board of Directors, following discussion with our predecessor independent registered public accounting firm, concluded that the Company's previously filed financial statements as of and for three months ended March 31, 2019, were no longer able to be relied upon as the result of the aggregation of errors identified by Management and the Company’s new accounting personnel during 2019 related to the following: As identified during preparation of the fiscal year 2019 Form 10-K: • The Company reevaluated its subsidiary consolidation process and discovered an inaccuracy in its accounting for the elimination of markup on intercompany sales. This resulted in the Company incorrectly including the markup in US inventory purchased from Apyx Bulgaria and resulted in an overstatement of cost of sales and a corresponding understatement of other costs and expenses when the inventory was sold, which did not have any impact on net income (loss) or financial position. ◦ For the three months ended March 31, 2019, the total impact included increases to both gross profit and to operating expenses of approximately $113,000 . • During the first quarter of 2020, while reconciling the 2019 income tax provision back to the corresponding records, we determined that when employees exercised non-qualified stock options, we did not collect and remit the employee’s income and payroll taxes on the exercises and did not accrue and remit the employer portion of payroll taxes. Due to statutory requirements, we have joint and several liability on the amounts that we did not withhold from employees and remit to the proper taxing authorities. While further investigating the issue, we determined that during 2018 we did not report the correct amount of income to employees on their form W-2 for both non-qualified and incentive stock option exercises and misclassified some non-qualified stock option exercises as incentive stock option exercises. ◦ For the three months ended March 31, 2019, the total aggregated impact included an increase to operating expenses of $16,000 , an increase of approximately $301,000 to other losses and an increase to net loss of approximately $317,000 . • Other minor items primarily related to the appropriate cutoff of transactions at the balance sheet date and the duplicate recording of a State income tax payment. ◦ For the three months ended March 31, 2019, the total aggregated impact included a decrease to operating loss of $90,000 and an increase to net loss of $40,000 . As previously disclosed and adjusted in Form 10-Q for the three and nine months ended September 2019 filed on November 11, 2019: • The Company reevaluated its accounting for stock-based compensation expense and during the three months ended September 30, 2019, the Company discovered errors in its accounting for certain items included in stock-based compensation expense. These errors related to its accounting for forfeitures, the vesting periods over which the expense was recognized, modifications, fair value measurements, and other minor miscellaneous items, all of which relate to the prior year. Additionally, the Company identified an issue relating to grants in the first quarter of 2019, whereby compensation was not recognized over the correct vesting period. ◦ For the three months ended March 31, 2019, the total impact included increases to operating expenses, operating loss and net loss of approximately $453,000 each. • During the three months ended September 30, 2019, the Company reevaluated its accounting for pre-development activities on certain OEM contracts. In performing the review, the Company determined that the it has not completed its performance obligations on its pre-development activities in these contracts. Accordingly, the Company determined that it had prematurely recognized revenues during the first quarter relating to these activities and did not defer the accompanying costs. ◦ For the three months ended March 31, 2019, the total impact included decreases to sales of approximately $194,000 , decreases to operating expenses of approximately $77,000 and increases to both operating loss and net loss of approximately $117,000 . A reconciliation of the originally reported amounts to the restated amounts for the adjustments noted above for each of the affected periods is presented below. Consolidated Balance Sheet as of March 31, 2019: (In thousands) As Originally Reported Adjustments As Restated ASSETS Current assets: Cash and cash equivalents $ 32,415 $ — $ 32,415 Short term investments 40,885 — 40,885 Trade accounts receivable, net 4,931 38 4,969 Inventories, net 5,598 — 5,598 Prepaid expenses and other current assets 1,411 38 1,449 Total current assets 85,240 76 85,316 Property and equipment, net 6,031 — 6,031 Intangibles 190 — 190 Deposits 80 — 80 Other assets 162 77 239 Total assets $ 91,703 $ 153 $ 91,856 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 1,504 $ — $ 1,504 Accrued expenses and other liabilities 5,460 127 5,587 Joint and several payroll tax liability — 1,014 1,014 Accrued severance and related 511 — 511 Total current liabilities 7,475 1,141 8,616 Related party note payable 140 — 140 Long-term portion of operating lease liabilities 75 — 75 Other long-term liabilities — 194 194 Total liabilities 7,690 1,335 9,025 STOCKHOLDERS' EQUITY Common stock, $0.001 par value; 75,000,000 shares authorized; 34,033,255 issued and 33,891,255 outstanding 34 — 34 Additional paid-in capital 53,147 1,035 54,182 Retained earnings 30,832 (2,217 ) 28,615 Total stockholders’ equity 84,013 (1,182 ) 82,831 Total liabilities and stockholders’ equity $ 91,703 $ 153 $ 91,856 Consolidated Statement of Operations for the three months ended March 31, 2019: (In thousands) As Originally Reported Adjustments As Restated Sales $ 5,823 $ (194 ) $ 5,629 Cost of sales 2,103 (37 ) 2,066 Gross profit 3,720 (157 ) 3,563 Other costs and expenses: Research and development 810 (80 ) 730 Professional services 1,791 327 2,118 Salaries and related costs 3,221 267 3,488 Selling, general and administrative 3,101 (144 ) 2,957 Total other costs and expenses 8,923 370 9,293 Loss from operations (5,203 ) (527 ) (5,730 ) Interest income 423 — 423 Other losses (25 ) (270 ) (295 ) Total other losses, net 398 (270 ) 128 Loss from continuing operations before income taxes (4,805 ) (797 ) (5,602 ) Income tax (benefit) expense (124 ) 130 6 Net loss $ (4,681 ) $ (927 ) $ (5,608 ) Loss per share Basic and Diluted $ (0.14 ) $ (0.03 ) $ (0.17 ) Weighted average number of shares outstanding basic and diluted 33,343 33,343 33,343

INVENTORIES

INVENTORIES	3 Months Ended
	Mar. 31, 2019
Inventory Disclosure [Abstract]
INVENTORIES	INVENTORIES Inventories are stated at the lower of cost or market. Cost is determined on a first in, first out basis. Finished goods and work-in-process inventories include material, labor and overhead costs. Factory overhead costs are allocated to inventory manufactured in-house based upon labor hours. Inventories consisted of the following: (In thousands) March 31, 2019 as Restated December 31, Raw materials $ 5,032 $ 4,521 Finished goods 964 1,215 Gross inventories 5,996 5,736 Less: reserve for obsolescence (398 ) (439 ) Net inventories $ 5,598 $ 5,297

INTANGIBLE ASSETS

INTANGIBLE ASSETS	3 Months Ended
	Mar. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
INTANGIBLE ASSETS	INTANGIBLE ASSETS Intangible assets consisted of the following: (in thousands) March 31, 2019 as Restated December 31, 2018 Purchased technology (5-17 year lives) $ 1,447 $ 1,448 Less: accumulated amortization (1,442 ) (1,442 ) Purchased technology, net $ 5 $ 6 Goodwill $ 185 $ 185 Intangibles $ 190 $ 191 Intangible assets and goodwill are the result of our acquisition of Apyx (formerly known as Bovie) Bulgaria, EOOD in 2015.

RECENT ACCOUNTING PRONOUNCEMENT

RECENT ACCOUNTING PRONOUNCEMENTS	3 Months Ended
	Mar. 31, 2019
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]
RECENT ACCOUNTING PRONOUNCEMENTS	RECENT ACCOUNTING PRONOUNCEMENTS ASU No. 2016-18, Restricted Cash Flows provides guidance on the presentation of restricted cash and restricted cash equivalents, which are now included with cash and cash equivalents when reconciling the beginning and ending cash amounts shown on the statements of cash flows. Using the retrospective transition method required under the standard, the Company has adjusted the presentation of its Condensed Consolidated Statements of Cash Flows for all periods presented. The adoption of ASU No. 2016-18 did not have any other impact on the Company’s Consolidated Financial Statements. ASU No. 2014-09 (ASC 606), Revenue from Contracts with Customers became effective for us beginning with the first quarter of 2018, and we adopted the new accounting standard using the modified retrospective transition approach. The modified retrospective transition approach recognized any changes from the beginning of the year of initial application through retained earnings with no restatement of comparative periods. We record revenue under ASC 606 at a single point in time, when control is transferred to the customer, which is consistent with past practice. We will continue to apply our current business processes, policies, systems and controls to support recognition and disclosure under the new standard. Based on the results of the evaluation, we have determined that the adoption of the new standard presents no material impact on our consolidated financial statements. Application of the transition requirements of the new standard did not have a material impact on opening retained earnings. We have disaggregated revenue by segment and geography in Note 12 Geographic and Segment Information. In February 2016, the FASB issued Accounting Standards Update No. 2016-02 (ASU 2016-02), Leases (Topic 842), which became effective for us beginning with the first quarter of 2019. ASU 2016-02 requires a lessee to record a right-of-use asset and a corresponding lease liability, initially measured at the present value of the lease payments, on the balance sheet for all leases with terms longer than 12 months, as well as the disclosure of key information about leasing arrangements. This new standard requires recognition in the statement of operations of a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight-line basis, and classification of all cash payments within operating activities in the statement of cash flows. Disclosures are required to provide the amount, timing and uncertainty of cash flows arising from leases. In accordance with the standard, we took a modified retrospective transition approach and included the $178,000 right of use asset and corresponding liabilities in our property plant and equipment, accrued expenses and long term lease liability on the consolidated balance sheet. The lease is also represented in our consolidated statement of cash flows as a non cash investing activity. No other new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material impact on our consolidated financial statements or disclosures.

EARNINGS PER SHARE

EARNINGS PER SHARE	3 Months Ended
	Mar. 31, 2019
Earnings Per Share [Abstract]
EARNINGS PER SHARE	EARNINGS PER SHARE We compute basic earnings per share (“basic EPS”) by dividing the net income or loss by the weighted average number of common shares outstanding for the reporting period. Diluted earnings per share (“diluted EPS”) gives effect to all dilutive potential shares outstanding. The following table provides the computation of basic and diluted earnings per share. Three Months Ended (in thousands, except per share data) 2019 as Restated 2018 Numerator: Net (loss) from continuing operations $ (5,608 ) $ (2,791 ) Numerator for diluted (loss) per common share - continuing operations (5,608 ) (2,791 ) Net income from discontinued operations, net of tax — 1,856 Numerator for diluted income per share - discontinued operations — 1,856 Net (loss) from all operations (5,608 ) (935 ) Numerator for full diluted (loss) per share - all (5,608 ) (935 ) Denominator - continuing operations Weighted average shares used to compute basic (loss) 33,343 32,878 Denominator for diluted (loss) per common share 33,343 32,878 Denominator - discontinued operations: Weighted average shares used to compute basic (loss) — 32,878 Denominator for diluted (loss) per common share - discontinued operations — 32,878 Denominator - all operations: Weighted average shares used to compute basic (loss) 33,343 32,878 Denominator for diluted (loss) per common share - all operations 33,343 32,878 Loss per share from continuing operations: Basic and diluted $ (0.17 ) $ (0.08 ) Income per share from discontinued operations Basic and diluted $ — $ 0.05 Loss per share from all operations Basic and diluted $ (0.17 ) $ (0.03 ) Anti-dilutive instruments excluded from diluted loss per common share: Warrants — 3 Options 1,908 470

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	3 Months Ended
	Mar. 31, 2019
Share-based Payment Arrangement [Abstract]
STOCK-BASED COMPENSATION	STOCK-BASED COMPENSATION Under our stock option plans, our board of directors may grant options to purchase common shares to our key employees, officers, directors and consultants. We account for stock options in accordance with FASB ASC Topic 718, Compensation - Stock Compensation , with option expense amortized over the vesting period based on the trinomial lattice option-pricing model fair value on the grant date, which includes a number of estimates that affect the amount of our expense. We expensed approximately $1,195,000 in stock-based compensation during the three months ended March 31, 2019 , as compared with $372,000 for the three months ended March 31, 2018 . The status of our stock options and stock awards are summarized as follows: Number of options - as Restated Weighted average exercise price - as Restated Outstanding at December 31, 2018 3,254,799 $ 3.18 Granted 1,277,500 7.73 Exercised (270,549 ) 2.87 Canceled and forfeited (10,500 ) 2.10 Outstanding at March 31, 2019 4,251,250 $ 4.57 Common shares required to be issued upon the exercise of stock options would be issued from our authorized and unissued shares. We calculated the fair value of issued options utilizing a trinomial lattice with an expected life calculated via the simplified method as we do not have sufficient history to determine actual expected life. 2019 Grants Option value $ 7.15 - $ 7.91 Risk-free rate 2.6% - 2.6 % Expected dividend yield — Expected volatility 69.1% - 69.1 % Expected term (in years) 6

INCOME TAXES

INCOME TAXES	3 Months Ended
	Mar. 31, 2019
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES The Company’s income tax expense was $6,000 with an effective tax rate of -0.1% for the three months ended March 31, 2019, as compared to an expense of $11,000 , with an effective tax rate of -0.4% , for the three months ended March 31, 2018. The effective rate differs from the statutory rate primarily due to a valuation allowance on our net operating loss carry forward and foreign taxes of $6,000 . The following is a roll-forward of the Company's total gross unrecognized tax benefits, not including interest and penalties, for the period ended March 31, 2019. (in thousands) Gross Unrealized Tax Benefits Balance at January 1, 2019 $ 1,313 Additions of tax positions related to the current year — Additions of tax positions related to the prior year — Decreases for tax positions related to the prior year — Balance at March 31, 2019 $ 1,313

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Property and Rental Agreements In October 2015, pursuant to our acquisition of Apyx Bulgaria, we became obligated to make lease payments of approximately $9,000 per month for approximately 20,000 square feet of office, research and manufacturing space in Sofia, Bulgaria. This lease expires in December 2020. The following is a schedule of approximate future minimum lease payments under operating leases as of March 31, 2019 : (In thousands) 2019 (remaining 9 months) $ 80 2020 107 Total $ 187 On August 30, 2018, we paid the remaining mortgage balance of $2.5 million on the Clearwater facility, releasing us from any and all obligations to the Bank of Tampa. Litigation The medical device industry is characterized by frequent claims and litigation, and we are and may become subject to various claims, lawsuits and proceedings in the ordinary course of our business, including claims by current or former employees, distributors and competitors, and with respect to our products and product liability claims, lawsuits and proceedings. We are involved in a number of legal actions relating to the use of our J-Plasma technology. The outcomes of these legal actions are not within our complete control and may not be known for prolonged periods of time. In the opinion of management, the Company has meritorious defenses, and such claims are adequately covered by insurance, or are not expected, individually or in the aggregate, to result in a material, adverse effect on our financial condition. However, in the event that damages exceed the aggregate coverage limits of our policy or if our insurance carriers disclaim coverage, we believe it is possible that costs associated with these claims could have a material adverse impact on our consolidated earnings, financial position or cash flows. In addition, as previously disclosed with the Commission on Form 8-K filed April 26, 2019, we have learned that on April 17, 2019, a complaint (the “Complaint”) was filed in the United States District Court for the Middle District of Florida by plaintiff Kyle Pritchard, individually and on behalf of all others similarly situated against the Company and Charles D. Goodwin (“Goodwin”), the Company’s President and Chief Executive Officer and a member of the Company’s Board of Directors. The Complaint (which as of the date hereof has not been delivered through formal process to the Company) seeks class action status on behalf of all persons and entities that acquired the Company’s securities between August 1, 2018 and April 1, 2019 and alleges violations by the Company and Goodwin of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, primarily related to certain public statements concerning the Premarket Notification 510(k) submission made to the US Food and Drug Administration for a new indication for the Company’s J-Plasma® technology for use in dermal resurfacing procedures. The Complaint seeks an unspecified amount of damages. Although the ultimate outcome of this matter cannot be determined with certainty, the Company believes that the allegations stated in the Complaint are entirely without merit. The Company and Goodwin intend to defend themselves vigorously in the suit. Such claims are adequately covered by insurance, however, in the event that damages exceed the aggregate coverage limits of our policy or if our insurance carriers disclaim coverage, we believe it is possible that costs associated with this claim could have a material adverse impact on our consolidated earnings, financial position or cash flows. Under the deductible portion of our insurance coverage, we have accrued $0.5 million for initial defense costs. In accordance with authoritative guidance, we accrue a liability in our consolidated financial statements for these actions when a loss is known or considered probable and the amount can be reasonably estimated. If the reasonable estimate of a known or probable loss is a range, and no amount within the range is a better estimate than any other, the minimum amount of the range is recorded. If a loss is reasonably possible, but not known or probable, and can be reasonably estimated, the estimated loss or range of loss is disclosed in the notes to the consolidated financial statements. In most cases, significant judgment is required to estimate the amount and timing of a loss to be recorded, actual results may differ from these estimates. Purchase Commitments At March 31, 2019 , we had purchase commitments for inventories totaling approximately $5.8 million , substantially all of which is expected to be purchased by the end of 2019 . Our manufacturing services agreements requires Symmetry to provide us with a twelve-month rolling production forecast, of which four months are binding, non-cancelable orders, subject to certain termination rights.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	3 Months Ended
	Mar. 31, 2019
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS Several relatives of Nikolay Shilev, Apyx Bulgaria’s Managing Director, are considered related parties. Teodora Shileva, Mr. Shilev’s spouse, is an employee of the Company working in the Accounting department. Antoaneta Dimitrova Shileva-Toromanova, Mr. Shilev’s sister, is the Manager of Production and Human Resources. Svetoslav Shilev, Mr. Shilev’s son, is an Engineer in the Quality Assurance department.

FINANCIAL INSTRUMENTS

FINANCIAL INSTRUMENTS	3 Months Ended
	Mar. 31, 2019
Investments, Debt and Equity Securities [Abstract]
FINANCIAL INSTRUMENTS	FINANCIAL INSTRUMENTS Cash, Cash Equivalents and Marketable Securities at March 31, 2019: (In thousands) Adjusted Cost Unrealized Gains Fair Value (3) Cash and Cash Equivalents (1) Short-term Marketable Securities Cash $ 3,802 $ — $ 3,802 $ 3,802 $ — Level 1 (2) U.S. Treasury Securities, maturities less than three months 28,613 — 28,613 28,613 — U.S. Treasury Securities, maturities greater than three months 40,721 164 40,885 — 40,885 Total $ 73,136 $ 164 $ 73,300 $ 32,415 $ 40,885 Cash, Cash Equivalents and Marketable Securities at December 31, 2018: (In thousands) Adjusted Cost Unrealized Gains Fair Value (3) Cash and Cash Equivalents (1) Short-term Marketable Securities Cash $ 6,467 $ — $ 6,467 $ 6,467 $ — Level 1 (2) U.S. Treasury Securities, maturities less than three months 10,129 — 10,129 10,129 — U.S. Treasury Securities, maturities greater than three months 61,431 247 61,678 — 61,678 Total $ 78,027 $ 247 $ 78,274 $ 16,596 $ 61,678 (1) The company considers all highly liquid instruments with maturities of three months or less at the time of purchase to be cash equivalents. (2) The fair value of the debt securities consisting of U.S. Treasury bills is based on their quoted market prices. The fair value of these financial instruments are classified as Level 1 in the fair value hierarchy. The original purchase of U.S. Treasury bills occurred in September 2018 utilizing the proceeds from the sale of our Core business. (3) ASC 825-10, Financial Instruments , allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings within interest income at each subsequent reporting date. At the date of purchase, the Company elected the fair value option for all investments with maturities of three months or greater at the time of purchase.

GEOGRAPHIC AND SEGMENT INFORMAT

GEOGRAPHIC AND SEGMENT INFORMATION	3 Months Ended
	Mar. 31, 2019
Segment Reporting [Abstract]
GEOGRAPHIC AND SEGMENT INFORMATION	GEOGRAPHIC AND SEGMENT INFORMATION Operating segments are aggregated into reportable segments only if they exhibit similar economic characteristics. In addition to similar economic characteristics, we also consider the following factors in determining the reportable segments: the nature of business activities, the management structure directly accountable to our chief operating decision maker for operating and administrative activities, availability of discrete financial information and information presented to the Board of Directors and investors. Our reportable segments are disclosed as principally organized and managed as two operating segments: Advanced Energy and OEM. "Corporate & Other" includes certain unallocated corporate and administrative costs which were not specifically attributed to any reportable segment. Net assets are shared, therefore, not allocated to the reportable segments. The OEM segment is primarily development and manufacturing contract and product driven, all related expenses are recorded as cost of sales, therefore no segment specific operating expenses are incurred. Summarized financial information with respect to reportable segments is as follows: Three Months Ended March 31, 2019 - as Restated (In thousands) Advanced Energy OEM Corporate & Other Total Sales 4,371 1,258 — 5,629 Net income (loss) from continuing operations (3,328 ) 591 (2,993 ) (5,730 ) Interest income — — 423 423 Other losses — — (295 ) (295 ) Income tax expense — — 6 6 Three Months Ended March 31, 2018 (In thousands) Advanced Energy OEM Corporate & Other Total Sales 2,629 768 — 3,397 Net income (loss) from continuing operations (578 ) 406 (2,548 ) (2,720 ) Interest expense — — (34 ) (34 ) Change in value of derivative liabilities — — (26 ) (26 ) Income tax expense — — 11 11 International sales represented approximately 30.5% of total revenues for the three months ended March 31, 2019 , as compared with 18.8% of total revenues for three months ended March 31, 2018 . Substantially all of these sales are denominated in U.S. dollars. Revenue by geographic region, based on the “ship to” location on the invoice, are as follows: Three Months Ended (In thousands) 2019 2018 Sales by Domestic and International Domestic $ 3,910 $ 2,758 International 1,719 639 Total $ 5,629 $ 3,397

JOINT AND SEVERAL PAYROLL LIABI

JOINT AND SEVERAL PAYROLL LIABILITY	3 Months Ended
	Mar. 31, 2019
Payables and Accruals [Abstract]
JOINT AND SEVERAL PAYROLL LIABILITY	JOINT AND SEVERAL PAYROLL LIABILITY As discussed in the Restatement Note (2), the Company did not report the correct amount of income to employees, nor did we collect and remit the employees' portion of income and payroll taxes, related to stock option exercises as required by the IRS. Due to IRS statutory requirements, we have joint and several liability for the full amount that was not withheld and remitted to the proper taxing authorities. This amount of the liability was approximately $1.0 million and $0.7 million at March 31, 2019 and December 31, 2018 respectively. The Company has recognized these amounts in other losses in the accompanying Consolidated Statements of Operations. If we can establish that our employees have in fact paid these obligations, either presently or in the future, we will be relieved of our liability.

BASIS OF PRESENTATION (Policies

BASIS OF PRESENTATION (Policies)	3 Months Ended
	Mar. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Inventories	Inventories are stated at the lower of cost or market. Cost is determined on a first in, first out basis. Finished goods and work-in-process inventories include material, labor and overhead costs. Factory overhead costs are allocated to inventory manufactured in-house based upon labor hours.
Recent Accounting Pronouncements	ASU No. 2016-18, Restricted Cash Flows provides guidance on the presentation of restricted cash and restricted cash equivalents, which are now included with cash and cash equivalents when reconciling the beginning and ending cash amounts shown on the statements of cash flows. Using the retrospective transition method required under the standard, the Company has adjusted the presentation of its Condensed Consolidated Statements of Cash Flows for all periods presented. The adoption of ASU No. 2016-18 did not have any other impact on the Company’s Consolidated Financial Statements. ASU No. 2014-09 (ASC 606), Revenue from Contracts with Customers became effective for us beginning with the first quarter of 2018, and we adopted the new accounting standard using the modified retrospective transition approach. The modified retrospective transition approach recognized any changes from the beginning of the year of initial application through retained earnings with no restatement of comparative periods. We record revenue under ASC 606 at a single point in time, when control is transferred to the customer, which is consistent with past practice. We will continue to apply our current business processes, policies, systems and controls to support recognition and disclosure under the new standard. Based on the results of the evaluation, we have determined that the adoption of the new standard presents no material impact on our consolidated financial statements. Application of the transition requirements of the new standard did not have a material impact on opening retained earnings. We have disaggregated revenue by segment and geography in Note 12 Geographic and Segment Information. In February 2016, the FASB issued Accounting Standards Update No. 2016-02 (ASU 2016-02), Leases (Topic 842), which became effective for us beginning with the first quarter of 2019. ASU 2016-02 requires a lessee to record a right-of-use asset and a corresponding lease liability, initially measured at the present value of the lease payments, on the balance sheet for all leases with terms longer than 12 months, as well as the disclosure of key information about leasing arrangements. This new standard requires recognition in the statement of operations of a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight-line basis, and classification of all cash payments within operating activities in the statement of cash flows. Disclosures are required to provide the amount, timing and uncertainty of cash flows arising from leases. In accordance with the standard, we took a modified retrospective transition approach and included the $178,000 right of use asset and corresponding liabilities in our property plant and equipment, accrued expenses and long term lease liability on the consolidated balance sheet. The lease is also represented in our consolidated statement of cash flows as a non cash investing activity. No other new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material impact on our consolidated financial statements or disclosures.

RESTATEMENT (Tables)

RESTATEMENT (Tables)	3 Months Ended
	Mar. 31, 2019
Accounting Changes and Error Corrections [Abstract]
Summary of Restatements	Consolidated Balance Sheet as of March 31, 2019: (In thousands) As Originally Reported Adjustments As Restated ASSETS Current assets: Cash and cash equivalents $ 32,415 $ — $ 32,415 Short term investments 40,885 — 40,885 Trade accounts receivable, net 4,931 38 4,969 Inventories, net 5,598 — 5,598 Prepaid expenses and other current assets 1,411 38 1,449 Total current assets 85,240 76 85,316 Property and equipment, net 6,031 — 6,031 Intangibles 190 — 190 Deposits 80 — 80 Other assets 162 77 239 Total assets $ 91,703 $ 153 $ 91,856 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 1,504 $ — $ 1,504 Accrued expenses and other liabilities 5,460 127 5,587 Joint and several payroll tax liability — 1,014 1,014 Accrued severance and related 511 — 511 Total current liabilities 7,475 1,141 8,616 Related party note payable 140 — 140 Long-term portion of operating lease liabilities 75 — 75 Other long-term liabilities — 194 194 Total liabilities 7,690 1,335 9,025 STOCKHOLDERS' EQUITY Common stock, $0.001 par value; 75,000,000 shares authorized; 34,033,255 issued and 33,891,255 outstanding 34 — 34 Additional paid-in capital 53,147 1,035 54,182 Retained earnings 30,832 (2,217 ) 28,615 Total stockholders’ equity 84,013 (1,182 ) 82,831 Total liabilities and stockholders’ equity $ 91,703 $ 153 $ 91,856 Consolidated Statement of Operations for the three months ended March 31, 2019: (In thousands) As Originally Reported Adjustments As Restated Sales $ 5,823 $ (194 ) $ 5,629 Cost of sales 2,103 (37 ) 2,066 Gross profit 3,720 (157 ) 3,563 Other costs and expenses: Research and development 810 (80 ) 730 Professional services 1,791 327 2,118 Salaries and related costs 3,221 267 3,488 Selling, general and administrative 3,101 (144 ) 2,957 Total other costs and expenses 8,923 370 9,293 Loss from operations (5,203 ) (527 ) (5,730 ) Interest income 423 — 423 Other losses (25 ) (270 ) (295 ) Total other losses, net 398 (270 ) 128 Loss from continuing operations before income taxes (4,805 ) (797 ) (5,602 ) Income tax (benefit) expense (124 ) 130 6 Net loss $ (4,681 ) $ (927 ) $ (5,608 ) Loss per share Basic and Diluted $ (0.14 ) $ (0.03 ) $ (0.17 ) Weighted average number of shares outstanding basic and diluted 33,343 33,343 33,343

INVENTORIES (Tables)

INVENTORIES (Tables)	3 Months Ended
	Mar. 31, 2019
Inventory Disclosure [Abstract]
Schedule of inventory	Inventories consisted of the following: (In thousands) March 31, 2019 as Restated December 31, Raw materials $ 5,032 $ 4,521 Finished goods 964 1,215 Gross inventories 5,996 5,736 Less: reserve for obsolescence (398 ) (439 ) Net inventories $ 5,598 $ 5,297

INTANGIBLE ASSETS (Tables)

INTANGIBLE ASSETS (Tables)	3 Months Ended
	Mar. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of intangible assets	Intangible assets consisted of the following: (in thousands) March 31, 2019 as Restated December 31, 2018 Purchased technology (5-17 year lives) $ 1,447 $ 1,448 Less: accumulated amortization (1,442 ) (1,442 ) Purchased technology, net $ 5 $ 6 Goodwill $ 185 $ 185 Intangibles $ 190 $ 191

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	3 Months Ended
	Mar. 31, 2019
Earnings Per Share [Abstract]
Basic and diluted earnings per share	The following table provides the computation of basic and diluted earnings per share. Three Months Ended (in thousands, except per share data) 2019 as Restated 2018 Numerator: Net (loss) from continuing operations $ (5,608 ) $ (2,791 ) Numerator for diluted (loss) per common share - continuing operations (5,608 ) (2,791 ) Net income from discontinued operations, net of tax — 1,856 Numerator for diluted income per share - discontinued operations — 1,856 Net (loss) from all operations (5,608 ) (935 ) Numerator for full diluted (loss) per share - all (5,608 ) (935 ) Denominator - continuing operations Weighted average shares used to compute basic (loss) 33,343 32,878 Denominator for diluted (loss) per common share 33,343 32,878 Denominator - discontinued operations: Weighted average shares used to compute basic (loss) — 32,878 Denominator for diluted (loss) per common share - discontinued operations — 32,878 Denominator - all operations: Weighted average shares used to compute basic (loss) 33,343 32,878 Denominator for diluted (loss) per common share - all operations 33,343 32,878 Loss per share from continuing operations: Basic and diluted $ (0.17 ) $ (0.08 ) Income per share from discontinued operations Basic and diluted $ — $ 0.05 Loss per share from all operations Basic and diluted $ (0.17 ) $ (0.03 ) Anti-dilutive instruments excluded from diluted loss per common share: Warrants — 3 Options 1,908 470

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	3 Months Ended
	Mar. 31, 2019
Share-based Payment Arrangement [Abstract]
Summary of stock options and stock awards	The status of our stock options and stock awards are summarized as follows: Number of options - as Restated Weighted average exercise price - as Restated Outstanding at December 31, 2018 3,254,799 $ 3.18 Granted 1,277,500 7.73 Exercised (270,549 ) 2.87 Canceled and forfeited (10,500 ) 2.10 Outstanding at March 31, 2019 4,251,250 $ 4.57
Schedule of option fair value assumptions	2019 Grants Option value $ 7.15 - $ 7.91 Risk-free rate 2.6% - 2.6 % Expected dividend yield — Expected volatility 69.1% - 69.1 % Expected term (in years) 6

INCOME TAXES (Tables)

INCOME TAXES (Tables)	3 Months Ended
	Mar. 31, 2019
Income Tax Disclosure [Abstract]
Unrecognized tax benefits roll-forward	The following is a roll-forward of the Company's total gross unrecognized tax benefits, not including interest and penalties, for the period ended March 31, 2019. (in thousands) Gross Unrealized Tax Benefits Balance at January 1, 2019 $ 1,313 Additions of tax positions related to the current year — Additions of tax positions related to the prior year — Decreases for tax positions related to the prior year — Balance at March 31, 2019 $ 1,313

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	3 Months Ended
	Mar. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
Future minimum lease payments under operating leases	The following is a schedule of approximate future minimum lease payments under operating leases as of March 31, 2019 : (In thousands) 2019 (remaining 9 months) $ 80 2020 107 Total $ 187

FINANCIAL INSTRUMENTS (Tables)

FINANCIAL INSTRUMENTS (Tables)	3 Months Ended
	Mar. 31, 2019
Investments, Debt and Equity Securities [Abstract]
Cash, Cash Equivalents and Investments	Cash, Cash Equivalents and Marketable Securities at March 31, 2019: (In thousands) Adjusted Cost Unrealized Gains Fair Value (3) Cash and Cash Equivalents (1) Short-term Marketable Securities Cash $ 3,802 $ — $ 3,802 $ 3,802 $ — Level 1 (2) U.S. Treasury Securities, maturities less than three months 28,613 — 28,613 28,613 — U.S. Treasury Securities, maturities greater than three months 40,721 164 40,885 — 40,885 Total $ 73,136 $ 164 $ 73,300 $ 32,415 $ 40,885 Cash, Cash Equivalents and Marketable Securities at December 31, 2018: (In thousands) Adjusted Cost Unrealized Gains Fair Value (3) Cash and Cash Equivalents (1) Short-term Marketable Securities Cash $ 6,467 $ — $ 6,467 $ 6,467 $ — Level 1 (2) U.S. Treasury Securities, maturities less than three months 10,129 — 10,129 10,129 — U.S. Treasury Securities, maturities greater than three months 61,431 247 61,678 — 61,678 Total $ 78,027 $ 247 $ 78,274 $ 16,596 $ 61,678 (1) The company considers all highly liquid instruments with maturities of three months or less at the time of purchase to be cash equivalents. (2) The fair value of the debt securities consisting of U.S. Treasury bills is based on their quoted market prices. The fair value of these financial instruments are classified as Level 1 in the fair value hierarchy. The original purchase of U.S. Treasury bills occurred in September 2018 utilizing the proceeds from the sale of our Core business. (3) ASC 825-10, Financial Instruments , allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings within interest income at each subsequent reporting date. At the date of purchase, the Company elected the fair value option for all investments with maturities of three months or greater at the time of purchase.

GEOGRAPHIC AND SEGMENT INFORM_2

GEOGRAPHIC AND SEGMENT INFORMATION (Tables)	3 Months Ended
	Mar. 31, 2019
Segment Reporting [Abstract]
Schedule of reporting information by segment	Summarized financial information with respect to reportable segments is as follows: Three Months Ended March 31, 2019 - as Restated (In thousands) Advanced Energy OEM Corporate & Other Total Sales 4,371 1,258 — 5,629 Net income (loss) from continuing operations (3,328 ) 591 (2,993 ) (5,730 ) Interest income — — 423 423 Other losses — — (295 ) (295 ) Income tax expense — — 6 6 Three Months Ended March 31, 2018 (In thousands) Advanced Energy OEM Corporate & Other Total Sales 2,629 768 — 3,397 Net income (loss) from continuing operations (578 ) 406 (2,548 ) (2,720 ) Interest expense — — (34 ) (34 ) Change in value of derivative liabilities — — (26 ) (26 ) Income tax expense — — 11 11
Schedule of revenue by geographic area	Revenue by geographic region, based on the “ship to” location on the invoice, are as follows: Three Months Ended (In thousands) 2019 2018 Sales by Domestic and International Domestic $ 3,910 $ 2,758 International 1,719 639 Total $ 5,629 $ 3,397

BASIS OF PRESENTATION - NARRATI

BASIS OF PRESENTATION - NARRATIVE (Details) - USD ($) $ in Millions	Aug. 30, 2018	Mar. 31, 2019	Mar. 31, 2018
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Proceeds from disposition of Core business	$ 97
Manufacture and Supply Agreement | Symmetry Surgical Inc.
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Asset purchase agreement, term		10 years
Electro Surgical Disposables and Accessories, Cauteries and Other Products Supply Agreement | Symmetry Surgical Inc.
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Asset purchase agreement, term		4 years
Discontinued Operations, Held-for-sale | Electro Surgical Disposables and Accessories, Cauteries and Other Products Supply Agreement | Symmetry Surgical Inc.
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain on sale of the Core Business, net of tax		$ 2.2	$ 6.5
Cost of sales		2.1	3.7
Operating expenses		$ 0.1	$ 0.9

RESTATEMENT- Narrative (Details

RESTATEMENT- Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Gross profit	$ 3,563	$ 2,212
Operating expenses	9,293	4,932
Other losses	295	0
Net loss	5,608	935
Operating income (loss)	(5,730)	(2,720)
Sales	(5,629)	$ (3,397)
Elimination Of Markup On Intercompany Sales | Adjustments
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Gross profit	113
Operating expenses	113
Income Tax Provision Corrections | Adjustments
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating expenses	16
Other losses	301
Net loss	317
Appropriate Cutoff Of Transactions Corrections | Adjustments
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Net loss	40
Operating income (loss)	90
Stock-based Compensation Corrections | Adjustments
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating expenses	453
Net loss	453
Operating income (loss)	(453)
Pre-development Activities On OEM Contracts | Adjustments
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Operating expenses	(77)
Net loss	117
Operating income (loss)	(117)
Sales	$ 194

RESTATEMENT - Consolidated Bala

RESTATEMENT - Consolidated Balance Sheets (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018	Mar. 31, 2018	Dec. 31, 2017
ASSETS
Cash and cash equivalents	$ 32,415	$ 16,596
Short term investments	40,885	61,678
Trade accounts receivable, net	4,969	5,080
Inventories, net of provision for obsolescence of $398 and $439	5,598	5,297
Prepaid expenses and other current assets	1,449	1,184
Total current assets	85,316	89,835
Property and equipment, net	6,031	5,788
Intangibles	190	191
Deposits	80	73
Other assets	239	41
Total assets	91,856	95,928
Current liabilities:
Accounts payable	1,504	1,423
Accrued expenses and other current liabilities	5,587	5,865
Joint and several payroll liability	1,014	713
Accrued severance and related	511	610
Total current liabilities	8,616	8,611
Note payable	140	140
Long term lease liability	75
Other long-term liabilities	194	0
Total liabilities	9,025	8,751
STOCKHOLDERS' EQUITY
Common stock	34	34
Additional paid-in capital	54,182	52,920
Retained earnings	28,615	34,223
Total stockholders’ equity	82,831	87,177	$ 21,469	$ 22,032
Total liabilities and stockholders’ equity	91,856	$ 95,928
As Originally Reported
ASSETS
Cash and cash equivalents	32,415
Short term investments	40,885
Trade accounts receivable, net	4,931
Inventories, net of provision for obsolescence of $398 and $439	5,598
Prepaid expenses and other current assets	1,411
Total current assets	85,240
Property and equipment, net	6,031
Intangibles	190
Deposits	80
Other assets	162
Total assets	91,703
Current liabilities:
Accounts payable	1,504
Accrued expenses and other current liabilities	5,460
Joint and several payroll liability	0
Accrued severance and related	511
Total current liabilities	7,475
Note payable	140
Long term lease liability	75
Other long-term liabilities	0
Total liabilities	7,690
STOCKHOLDERS' EQUITY
Common stock	34
Additional paid-in capital	53,147
Retained earnings	30,832
Total stockholders’ equity	84,013
Total liabilities and stockholders’ equity	91,703
Material Corrections | Adjustments
ASSETS
Cash and cash equivalents	0
Short term investments	0
Trade accounts receivable, net	38
Inventories, net of provision for obsolescence of $398 and $439	0
Prepaid expenses and other current assets	38
Total current assets	76
Property and equipment, net	0
Intangibles	0
Deposits	0
Other assets	77
Total assets	153
Current liabilities:
Accounts payable	0
Accrued expenses and other current liabilities	127
Joint and several payroll liability	1,014
Accrued severance and related	0
Total current liabilities	1,141
Note payable	0
Long term lease liability	0
Other long-term liabilities	194
Total liabilities	1,335
STOCKHOLDERS' EQUITY
Common stock	0
Additional paid-in capital	1,035
Retained earnings	(2,217)
Total stockholders’ equity	(1,182)
Total liabilities and stockholders’ equity	$ 153

RESTATEMENT - Consolidated Ba_2

RESTATEMENT - Consolidated Balance Sheets - Additional Information (Details) - $ / shares	Mar. 31, 2019	Dec. 31, 2018
Accounting Changes and Error Corrections [Abstract]
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	75,000,000	75,000,000
Common stock, shares issued (in shares)	34,033,255	33,847,100
Common stock, shares outstanding (in shares)	33,891,255	33,704,525

RESTATEMENT - Consolidated Stat

RESTATEMENT - Consolidated Statements of Operations (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Sales	$ 5,629	$ 3,397
Cost of sales	2,066	1,185
Gross profit	3,563	2,212
Other costs and expenses:
Research and development	730	514
Professional services	2,118	506
Salaries and related costs	3,488	1,802
Selling, general and administrative	2,957	2,110
Total other costs and expenses	9,293	4,932
Loss from operations	(5,730)	(2,720)
Interest income	423	0
Other losses	(295)	0
Total other income (expense), net	128	(60)
Loss before income taxes	(5,602)	(2,780)
Income tax expense	6	11
Loss from continuing operations	$ (5,608)	$ (2,791)
Loss per share
Loss per share, Basic and Diluted (in dollars per share)	$ (0.17)	$ (0.03)
Weighted average number of shares outstanding basic and diluted (in shares)	33,343
As Originally Reported
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Sales	$ 5,823
Cost of sales	2,103
Gross profit	3,720
Other costs and expenses:
Research and development	810
Professional services	1,791
Salaries and related costs	3,221
Selling, general and administrative	3,101
Total other costs and expenses	8,923
Loss from operations	(5,203)
Interest income	423
Other losses	(25)
Total other income (expense), net	398
Loss before income taxes	(4,805)
Income tax expense	(124)
Loss from continuing operations	$ (4,681)
Loss per share
Loss per share, Basic and Diluted (in dollars per share)	$ (0.14)
Weighted average number of shares outstanding basic and diluted (in shares)	33,343
Adjustments | Material Corrections
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Sales	$ (194)
Cost of sales	(37)
Gross profit	(157)
Other costs and expenses:
Research and development	(80)
Professional services	327
Salaries and related costs	267
Selling, general and administrative	(144)
Total other costs and expenses	370
Loss from operations	(527)
Interest income	0
Other losses	(270)
Total other income (expense), net	(270)
Loss before income taxes	(797)
Income tax expense	130
Loss from continuing operations	$ (927)
Loss per share
Loss per share, Basic and Diluted (in dollars per share)	$ (0.03)
Weighted average number of shares outstanding basic and diluted (in shares)	33,343

INVENTORIES (Details)

INVENTORIES (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Raw materials	$ 5,032	$ 4,521
Finished goods	964	1,215
Gross inventories	5,996	5,736
Less: reserve for obsolescence	(398)	(439)
Net inventories	$ 5,598	$ 5,297

INTANGIBLE ASSETS (Details)

INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]
Less: accumulated amortization	$ (1,442)	$ (1,442)
Purchased technology, net	5	6
Goodwill	185	185
Intangibles	190	191
Purchased Technology
Finite-Lived Intangible Assets [Line Items]
Purchased technology (5-17 year lives)	$ 1,447	$ 1,448
Purchased Technology | Minimum
Finite-Lived Intangible Assets [Line Items]
Intangible asset, useful life (in years)	5 years
Purchased Technology | Maximum
Finite-Lived Intangible Assets [Line Items]
Intangible asset, useful life (in years)	17 years

RECENT ACCOUNTING PRONOUNCEME_2

RECENT ACCOUNTING PRONOUNCEMENTS (Details) - ASU 2016-02	Jan. 01, 2019USD ($)
New Accounting Pronouncement, Early Adoption [Line Items]
Right of use asset	$ 178,000
Lease liabilities	$ 178,000

EARNINGS PER SHARE (Details)

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Numerator:
Net (loss) from continuing operations	$ (5,608)	$ (935)
Numerator for diluted (loss) per common share - continuing operations	(5,608)	(2,791)
Total income from discontinued operations, net of tax	0	1,856
Numerator for diluted income per share - discontinued operations	0	1,856
Net (loss) from all operations	(5,608)	(935)
Numerator for full diluted (loss) per share - all	$ (5,608)	$ (935)
Denominator
Weighted average shares used to compute basic (loss) (in shares)	0	32,878
Denominator for diluted (loss) per common share (in shares)	33,343	32,878
Weighted average shares used to compute basic (loss) (in shares)	33,343	32,878
Denominator for diluted (loss) per common share - discontinued operations (in shares)	0	32,878
Denominator for diluted (loss) per common share - all operations (in shares)	33,343	32,878
Loss per share from continuing operations:
Basic and diluted (in dollars per share)	$ (0.17)	$ (0.08)
Income per share from discontinued operations
Basic and diluted (in dollars per share)	0	0.05
Loss per share from all operations
Basic and diluted (in dollars per share)	$ (0.17)	$ (0.03)
Warrants
Loss per share from all operations
Anti-dilutive instruments excluded from diluted loss per common share (in shares)	0	3
Options
Loss per share from all operations
Anti-dilutive instruments excluded from diluted loss per common share (in shares)	1,908	470

STOCK-BASED COMPENSATION - NARR

STOCK-BASED COMPENSATION - NARRATIVE (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Share-based Payment Arrangement [Abstract]
Stock based compensation	$ 1,195	$ 372

STOCK-BASED COMPENSATION - SUMM

STOCK-BASED COMPENSATION - SUMMARY OF STOCK OPTIONS (Details)	3 Months Ended
	Mar. 31, 2019$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding, beginning of period (in shares) | shares	3,254,799
Granted (in shares) | shares	1,277,500
Exercised (in shares) | shares	(270,549)
Canceled and forfeited (in shares) | shares	(10,500)
Outstanding, end of period (in shares) | shares	4,251,250
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]
Outstanding, beginning of period (in dollars per share) | $ / shares	$ 3.18
Granted (in dollars per share) | $ / shares	7.73
Exercised (in dollars per share) | $ / shares	2.87
Canceled and forfeited (in dollars per shares) | $ / shares	2.10
Outstanding, end of period (in dollars per share) | $ / shares	$ 4.57

STOCK-BASED COMPENSATION - FAIR

STOCK-BASED COMPENSATION - FAIR VALUE ASSUMPTIONS (Details)	3 Months Ended
	Mar. 31, 2019$ / shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Option value (in dollars per share)	$ 7.73
Expected dividend yield (as a percent)	0.00%
Expected volatility - low (as a percent)	69.10%
Expected volatility - high (as a percent)	69.10%
Expected term (in years)	6 years
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Option value (in dollars per share)	$ 7.15
Risk-free rate (as a percent)	2.60%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Option value (in dollars per share)	$ 7.91
Risk-free rate (as a percent)	2.60%

INCOME TAXES - NARRATIVE (Detai

INCOME TAXES - NARRATIVE (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Tax Disclosure [Abstract]
Income tax expense	$ 6	$ 11
Effective income tax rate, percent	(0.10%)	(0.40%)
Foreign taxes	$ 6

INCOME TAXES - UNRECOGNIZED TAX

INCOME TAXES - UNRECOGNIZED TAX BENEFITS ROLL-FORWARD (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019USD ($)
Gross Unrealized Tax Benefits
Balance at January 1, 2019	$ 1,313
Additions of tax positions related to the current year	0
Additions of tax positions related to the prior year	0
Decreases for tax positions related to the prior year	0
Balance at March 31, 2019	$ 1,313

COMMITMENTS AND CONTINGENCIES -

COMMITMENTS AND CONTINGENCIES - NARRATIVE (Details)	Aug. 30, 2018USD ($)	Apr. 17, 2019USD ($)	Mar. 31, 2019USD ($)	Oct. 31, 2015USD ($)ft²
Other Commitments [Line Items]
Repayment of mortgage note payable	$ (2,500,000)
Purchase commitments for inventories			$ 5,800,000
Sophia, Bulgaria
Other Commitments [Line Items]
Monthly cost of office space				$ 9,000
Area of real estate property (in square feet) | ft²				20,000
Scenario, Forecast | Unfavorable Regulatory Action | Pending Litigation
Other Commitments [Line Items]
Costs accrued		$ 500,000

COMMITMENTS AND CONTINGENCIES_2

COMMITMENTS AND CONTINGENCIES - FUTURE MINIMUM LEASE PAYMENTS (Details) $ in Thousands	Mar. 31, 2019USD ($)
Future minimum lease payments under operating leases
2019 (remaining 9 months)	$ 80
2020	107
Total	$ 187

FINANCIAL INSTRUMENTS (Details)

FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Debt Securities, Available-for-sale [Line Items]
Cash	$ 3,802	$ 6,467
Adjusted Cost	73,136	78,027
Unrealized Gains	164	247
Fair Value	73,300	78,274
Cash and cash equivalents	32,415	16,596
Short-term Marketable Securities	40,885	61,678
U.S. Treasury Securities, maturities less than three months
Debt Securities, Available-for-sale [Line Items]
Adjusted Cost	28,613	10,129
Fair Value	28,613	10,129
Cash equivalents	28,613	10,129
U.S. Treasury Securities, maturities greater than three months
Debt Securities, Available-for-sale [Line Items]
Adjusted Cost	40,721	61,431
Unrealized Gains	164	247
Fair Value	40,885	61,678
Short-term Marketable Securities	$ 40,885	$ 61,678

GEOGRAPHIC AND SEGMENT INFORM_3

GEOGRAPHIC AND SEGMENT INFORMATION - NARRATIVE (Details) - segment	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting [Abstract]
Number of operating segments (in segments)	2
Geographic concentration risk | Sales Revenue | International customers
Concentration Risk [Line Items]
Concentration receivable risk (as a percent)	30.50%	18.80%

GEOGRAPHIC AND SEGMENT INFORM_4

GEOGRAPHIC AND SEGMENT INFORMATION - REPORTABLE SEGMENT (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting Information [Line Items]
Sales	$ 5,629	$ 3,397
Operating income (loss)	(5,730)	(2,720)
Interest income	423	0
Interest expense	0	(34)
Other losses	(295)	0
Change in value of derivative liabilities	0	(26)
Income tax expense	(6)	(11)
Operating Segments | Advanced Energy
Segment Reporting Information [Line Items]
Sales	4,371	2,629
Operating income (loss)	(3,328)	(578)
Interest income	0
Interest expense		0
Other losses	0
Change in value of derivative liabilities		0
Income tax expense	0	0
Operating Segments | OEM
Segment Reporting Information [Line Items]
Sales	1,258	768
Operating income (loss)	591	406
Interest income	0
Interest expense		0
Other losses	0
Change in value of derivative liabilities		0
Income tax expense	0	0
Corporate (Other)
Segment Reporting Information [Line Items]
Sales	0	0
Operating income (loss)	(2,993)	(2,548)
Interest income	423
Interest expense		(34)
Other losses	(295)
Change in value of derivative liabilities		(26)
Income tax expense	$ (6)	$ (11)

GEOGRAPHIC AND SEGMENT INFORM_5

GEOGRAPHIC AND SEGMENT INFORMATION - GEOGRAPHIC (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting Information [Line Items]
Sales	$ 5,629	$ 3,397
Domestic
Segment Reporting Information [Line Items]
Sales	3,910	2,758
International
Segment Reporting Information [Line Items]
Sales	$ 1,719	$ 639

JOINT AND SEVERAL PAYROLL LIA_2

JOINT AND SEVERAL PAYROLL LIABILITY (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Payables and Accruals [Abstract]
Joint and several payroll liability	$ 1,014	$ 713