Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 03, 2016 | |
Entity Registrant Name | QUALSTAR CORP | |
Entity Central Index Key | 758,938 | |
Trading Symbol | qbak | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Entity Common Stock, Shares Outstanding (in shares) | 12,253,117 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 3,746 | $ 3,963 |
Accounts receivables, net | 1,334 | 1,630 |
Inventories, net | 2,218 | 2,444 |
Prepaid expenses and other current assets | 225 | 219 |
Total current assets | 7,523 | 8,256 |
Non-current assets: | ||
Property and equipment, net | 426 | 446 |
Other assets | 35 | 25 |
Total assets | 7,984 | 8,727 |
Current liabilities: | ||
Accounts payable | 656 | 756 |
Accrued payroll and related liabilities | 289 | 332 |
Deferred service revenue, short term | 899 | 994 |
Other accrued liabilities | 326 | 467 |
Total current liabilities | 2,170 | 2,549 |
Long term liabilities: | ||
Other long term liabilities | 63 | 27 |
Deferred service revenue | 117 | 104 |
Total long term liabilities | 180 | 131 |
Total liabilities | $ 2,350 | $ 2,680 |
Commitments and contingencies (Notes 7 and 8) | ||
Shareholders’ equity: | ||
Preferred stock, no par value; 5,000 shares authorized; no shares issued | ||
Common stock, no par value; 50,000 shares authorized, 12,253 shares issued and outstanding as of March 31, 2016 and December 31, 2015 | $ 19,062 | $ 19,061 |
Accumulated deficit | (13,428) | (13,014) |
Total shareholders’ equity | 5,634 | 6,047 |
Total liabilities and shareholders’ equity | $ 7,984 | $ 8,727 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - $ / shares | Mar. 31, 2016 | Dec. 31, 2015 |
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 12,253,000 | 12,253,000 |
Common stock, shares outstanding (in shares) | 12,253,000 | 12,253,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Net revenues | $ 2,150,000 | $ 2,805,000 |
Cost of goods sold | 1,501,000 | 1,888,000 |
Gross profit | 649,000 | 917,000 |
Operating expenses: | ||
Engineering | 395,000 | 314,000 |
Sales and marketing | 300,000 | 452,000 |
General and administrative | 369,000 | 608,000 |
Total operating expenses | 1,064,000 | 1,374,000 |
Loss from operations | (415,000) | (457,000) |
Other income (expense) | 1,000 | (30,000) |
Loss before income taxes | (414,000) | (487,000) |
Provision for income taxes | 0 | 0 |
Net loss | $ (414,000) | $ (487,000) |
Loss per common share: | ||
Basic and diluted (in dollars per share) | $ (0.03) | $ (0.04) |
Weighted average common shares outstanding: | ||
Basic and diluted (in shares) | 12,253 | 12,253 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (414) | $ (487) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | $ 47 | 64 |
Loss on disposal of assets | 25 | |
Provision for (recovery of) bad debts and returns | (12) | |
Share based compensation | $ 1 | 20 |
Loss on sale of marketable securities | 1 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | $ 296 | 835 |
Inventories | 226 | 137 |
Prepaid expenses and other current assets | (16) | 149 |
Accounts payable | (100) | (267) |
Accrued payroll and related liabilities | (43) | 101 |
Deferred service revenue | (82) | (122) |
Other accrued liabilities | (105) | (120) |
Total adjustments | 224 | 811 |
Net cash provided by (used in) operating activities | $ (190) | 324 |
Cash flows from investing activities: | ||
Proceeds from sale of assets | 27 | |
Purchases of equipment | $ (27) | (140) |
Net cash used in investing activities | (27) | (113) |
Net increase (decrease) in cash and cash equivalents | (217) | 211 |
Cash and cash equivalents at beginning of period | 3,963 | 5,242 |
Cash and cash equivalents at end of period | 3,746 | $ 5,453 |
Supplemental cash flow disclosures: | ||
Income taxes paid | $ 8 |
Note 1 - Summary of Significant
Note 1 - Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Significant Accounting Policies [Text Block] | NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation In the opinion of management, the accompanying unaudited condensed consolidated financial statements, including balance sheets and related interim statements of operations and cash flows, include all adjustments, consisting primarily of normal recurring items, which are necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Preparing condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Examples include estimates of loss contingencies, product life cycles and inventory obsolescence, bad debts, sales returns, share-based compensation, forfeiture rates, the potential outcome of future tax consequences of events that have been recognized in our financial statements or tax returns, and determining when investment impairments are other-than-temporary. Actual results and outcomes may differ from management’s estimates and assumptions. The condensed consolidated financial statements include our accounts and the accounts of our wholly-owned subsidiary in Singapore. All significant intercompany accounts and transactions have been eliminated in consolidation. Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in the Qualstar Corporation Annual Report on Form 10-KT for the transition year ended December 31, 2015, filed with the U.S. Securities and Exchange Commission (“SEC”) on March 30, 2016. Revenue Recognition We recognize revenue in accordance with Accounting Standards Codification (“ASC”) 605, “Revenue Recognition,” when there is persuasive evidence that an arrangement exists, title and risk of loss have passed, delivery has occurred or the services have been rendered, the sales price is fixed or determinable and collection of the related receivable is reasonably assured. Title and risk of loss generally pass to our customers upon shipment. In limited circumstances where either title or risk of loss pass upon destination or acceptance or when collection is not reasonably assured, we defer revenue recognition until such events occur. Service contracts are sold by Qualstar to customers for a period of time to provide product support after the warranty expires. The service contracts allow customers to call Qualstar for technical support, replace defective parts and to have onsite service provided by Qualstar’s third party contract service provider. The Company records revenues for contract services at the amount of the service contract, but such amount is deferred at the beginning of the service term and amortized ratably over the life of the contract. Deferred service revenue is shown separately in the condensed consolidated balance sheets as current and long term. At March 31, 2016, we had deferred service revenue of approximately $1,016,000. At December 31, 2015, we had deferred service revenue of approximately $1,098,000. Fair Value of Financial Instruments We measure fair value on all financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the condensed consolidated financial statements on a recurring basis (at least quarterly). See “Note 5 – Fair Value Measurements.” QUALSTAR CORPORATION AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)-(Continued) Allowance for Doubtful Accounts We estimate our allowance for doubtful accounts based on an assessment of the collectability of specific accounts and the overall condition of accounts receivable. In evaluating the adequacy of the allowance for doubtful accounts, specific trade receivables, historical bad debts, customer credits, customer credit-worthiness and changes in customers’ payment terms and patterns are analyzed. If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make additional payments, then additional allowances may be needed. Likewise, if it is determined that more of our receivables may be realized in the future than previously estimated, we would adjust the allowance to increase income in the period of this determination. Inventory Valuation We record inventories at the lower of cost (first-in, first-out basis) or market value. We assess the value of our inventories periodically based upon numerous factors including expected product or material demand, current market conditions, technological obsolescence, current cost and net realizable value. If necessary, we write down our inventory for estimated obsolescence, potential shrinkage, or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions. If technology changes more rapidly than expected, or market conditions become less favorable than those projected by management, additional inventory write-downs may be required. Warranty Obligations We provide for the estimated cost of product warranties at the time the related revenue is recognized. We engage in extensive product quality programs and processes, including active monitoring and evaluation of product failure rates, material usage and estimation of service delivery costs incurred in correcting a product failure. However, should actual product failure rates, material usage, or service delivery costs differ from our estimates, then revisions to the estimated warranty liability would be required. Historically, our warranty costs have not been significant. Legal and Other Contingencies The outcomes of legal proceedings and claims brought against us are subject to significant uncertainty. An estimated loss from a loss contingency such as a legal proceeding or claim is accrued by a charge to income if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. When legal costs that the entity expects to incur in defending itself in connection with a loss contingency accrual are expected to be material, the loss should factor in all costs and, if the legal costs are reasonably estimable, they should be accrued in accordance with ASC 450, regardless of whether a liability can be estimated for the contingency itself. Disclosure of a contingency is required if there is at least a reasonable possibility that a loss has been incurred. Changes in these factors could materially impact our condensed consolidated financial statements. Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation, with no changes to previously reported stockholders equity or net loss. QUALSTAR CORPORATION AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)-(Continued) Share-Based Compensation Share-based compensation is accounted for in accordance with ASC 718, “Compensation – Stock Compensation.” The Black-Scholes option-pricing model is used to determine fair value of the award at the date of grant and recognize compensation expense over the vesting period. The inputs for the model require the use of judgment, estimates and assumptions regarding the expected volatility of the stock, the expected term the average employee will hold the option prior to the date of exercise, expected future dividends, and the amount of share-based awards that are expected to be forfeited. Changes in these inputs and assumptions could occur and actual results could differ from these estimates, and our results of operations could be impacted. Accounting for Income Taxes We estimate our tax liabilities based on current tax laws in the statutory jurisdictions in which we operate in accordance with ASC 740, “Income Taxes.” These estimates include judgments about deferred tax assets and liabilities resulting from temporary differences between assets and liabilities recognized for financial reporting purposes and such amounts recognized for tax purposes, as well as about the realization of deferred tax assets. We may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and income tax disclosures. We maintain a valuation allowance to reduce our deferred tax assets due to the uncertainty surrounding the timing of realizing the benefits of net deferred tax assets in future years. We have considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for such a valuation allowance. In the event we were to determine that we would be able to realize all or part of our net deferred tax asset in the future, the valuation allowance would be decreased accordingly. We may periodically undergo examinations by the federal and state regulatory authorities and the Internal Revenue Service. We may be assessed additional taxes and/or penalties contingent on the outcome of these examinations. Our previous examinations have not resulted in any unfavorable or significant assessments. |
Note 2 - Recent Accounting Pron
Note 2 - Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | NOTE 2 – RECENT ACCOUNTING PRONOUNCEMENTS Recent accounting guidance not yet adopted In May 2014, the FASB issued ASU 2014-09 to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and IFRS that will remove inconsistencies and weaknesses in revenue requirements, provide a more robust framework for addressing revenue issues, improve comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets, provide more useful information to users of financial statements through improved disclosure requirements, and simplify the preparation of financial statements by reducing the number of requirements to which an entity must refer. The new guidance will be effective for reporting periods beginning after December 15, 2016. In August 2015, the FASB issued ASU 2015-14 as an update of ASU 2014-09. The purpose is to allow more time to implement the guidance in Update 2014-09. This Update defers the effective date of Update 2014-09 to annual reporting periods beginning after December 15, 2017. The Company is still evaluating the impact on the condensed consolidated financial statements. QUALSTAR CORPORATION AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)-(Continued) In June 2014, the FASB issued ASU 2014-12 to resolve the diverse accounting treatment of share-based payment awards that require specific performance targets to be achieved in order for employees to become eligible to vest in the awards. The new guidance will be effective for us beginning after December 15, 2017, and is not expected to impact our condensed consolidated financial statements. In August 2014, the FASB issued ASU 2014-15. This standard sets forth management’s responsibility to evaluate, each reporting period, whether there is substantial doubt about our ability to continue as a going concern, and if so, to provide related footnote disclosures. The standard is effective for annual reporting periods ending after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016. We are currently evaluating this new standard and after adoption, we will incorporate this guidance in our assessment of going concern. This new standard is not expected to impact our condensed consolidated financial statements. In January 2015, the FASB issued ASU 2015-01 to eliminate the concept of extraordinary and unusual items, simplifying the income statement presentation. The standard is effective for fiscal and interim periods within those fiscal years, beginning after December 15, 2015 , and is not expected to impact our condensed consolidated financial statements. In February 2015, the FASB issued ASU 2015-02 to change the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The standard is effective for fiscal and interim periods within those fiscal years, beginning after December 15, 2015. We are currently evaluating this new standard and after adoption, we will incorporate this guidance in our analysis for consolidations. This new standard is not expected to impact our condensed consolidated financial statements. In April 2015, the FASB issued ASU 2015-03 to reduce complexity in the balance sheet presentation of debt issuance costs, discounts and premiums. The standard is effective for fiscal and interim periods within those fiscal years, beginning after December 15, 2015 , and is not expected to impact our condensed consolidated financial statements. In June 2015, the FASB issued ASU 2015-10 to cover a wide range of topics in the codification and are generally categorized as follows: amendments related to differences between original guidance and the codification; guidance clarification and reference corrections; and minor improvements. The standard is effective for fiscal and interim periods within those fiscal years, beginning after December 15, 2015 , and is not expected to impact our condensed consolidated financial statements. In July 2015, the FASB issued ASU 2015-11 to simplify the measurement of inventory. The objective is to identify, evaluate, and improve areas of GAAP for which cost and complexity can be reduced while maintaining or improving the usefulness of the information provided to users of financial statements. The standard is effective for fiscal years beginning after December 15, 2016 , and is not expected to impact our condensed consolidated financial statements . In February, 2016, the FASB issued ASU 2016-02 to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. For related party leases, the basis will be the legally enforceable terms and conditions of the arrangement. This standard is effective for fiscal years beginning after December 15, 2018. The Company is evaluating the impact it may have on its condensed consolidated financial statements. |
Note 3 - Significant Customers,
Note 3 - Significant Customers, Concentration of Credit Risk, and Geographic Information | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Concentration Risk Disclosure [Text Block] | NOTE 3 – SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK, AND GEOGRAPHIC INFORMATION We are exposed to interest rate risks. Our investment income is sensitive to changes in the general level of U.S. interest rates. We have no outstanding debt nor do we utilize auction rate securities or derivative financial instruments in our investment portfolio. Cash and other investments may be in excess of FDIC insurance limits. Our financial results could be affected by changes in foreign currency exchange rates or weak economic conditions in foreign markets. As all sales are currently made in U.S. dollars, a strengthening of the dollar could make our products less competitive in foreign markets. Three Months Ended March 31 , 2016 2015 (unaudited) (unaudited) Revenue – geographic activity (in thousands): $ % $ % North America $ 1,251 58.2 % $ 1,225 43.7 % Europe 488 22.7 % 485 17.3 % Asia Pacific 402 18.7 % 936 33.3 % Other 9 0.4 % 159 5.7 % $ 2,150 100.0 % $ 2,805 100.0 % Two customers accounted for 15.0% and 9.4% of the Company’s net revenue for the three month period ended March 31, 2016. The customer’s accounts receivable balance totaled 17.0% and 14.4%, respectively, of net accounts receivable as of March 31, 2016. Two customers accounted for 13.7% and 13.5% of the Company’s net revenue for the three month period ended March 31, 2015. The customer’s accounts receivable balances totaled 21.4% and 15.6% of net accounts receivable as of March 31, 2015. |
Note 4 - Net Loss Per Share
Note 4 - Net Loss Per Share | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | NOTE 4 – NET LOSS PER SHARE Basic net loss per share has been computed by dividing net loss by the weighted average number of common shares outstanding. Diluted net loss per share has been computed by dividing net loss by the weighted average common shares outstanding plus dilutive securities or other contracts to issue common stock as if these securities were exercised or converted to common stock. The following table sets forth the computation of basic and diluted net loss per share for the periods indicated, in thousands, except per share amounts: Three Months Ended March 31, 2016 2015 (unaudited) (unaudited) In thousands (except per share amounts): Net loss (a) $ (414 ) $ (487 ) Weighted average outstanding shares of common stock (b) 12,253 12,253 Dilutive potential common shares from employee stock options — — Common stock and common stock equivalents (c) 12,253 12,253 Loss per share: Basic net loss per share (a)/(b) $ (0.03 ) $ (0.04 ) Diluted net loss per share (a)/(c) $ (0.03 ) $ (0.04 ) |
Note 5 - Fair Value Measurement
Note 5 - Fair Value Measurements | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Fair Value Disclosures [Text Block] | NOTE 5 – FAIR VALUE MEASUREMENTS Our financial assets and liabilities are measured and recorded at fair value on a recurring basis. Our money market funds are included in cash and cash equivalents in our condensed consolidated balance sheets and are valued using quoted market prices at the respective balance sheet dates (in thousands): Level 1: March 31, 2016 December 31 , 201 5 (unaudited) Cash $ 709 $ 928 Money Market Funds 3,037 3,035 Total cash and cash equivalents $ 3,746 $ 3,963 |
Note 6 - Balance Sheet Details
Note 6 - Balance Sheet Details | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Supplemental Balance Sheet Disclosures [Text Block] | NOTE 6 - BALANCE SHEET DETAILS The following tables provide details of selected balance sheet accounts (in thousands): Inventories Inventories are stated at the lower of cost (first-in, first-out basis) or market. Inventories are comprised as follows (in thousands): March 31, 2016 December 31, 2015 (unaudited) Raw materials $ 313 $ 263 Finished goods 1,905 2,181 Net inventory balance $ 2,218 $ 2,444 Other Accrued Liabilities The components of other liabilities are as follows (in thousands): March 31, 2016 December 31 , 201 5 (unaudited) Accrued commissions $ 37 $ 37 Accrued audit fees 17 149 Deferred rent 52 42 Accrued warranty 205 187 Other accrued liabilities 15 52 Total other accrued liabilities $ 326 $ 467 |
Note 7 - Contingencies
Note 7 - Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Contingencies Disclosure [Text Block] | NOTE 7 –CONTINGENCIES Accrued Warranty We provide for the estimated costs of hardware warranties at the time the related revenue is recognized. We estimate the costs based on historical and projected product failure rates, historical and projected repair costs, and knowledge of specific product failures (if any). The specific hardware warranty terms and conditions for tape libraries generally include parts and labor over a three-year period. The warranty for power supplies is generally three years. We regularly re-evaluate our estimates to assess the adequacy of the recorded warranty liabilities and adjust the amounts as necessary. Activity in the liability for product warranty, which is included in other accrued liabilities in the condensed consolidated balance sheets for the periods presented, is as follows (in thousands): Three months Ended March 31, 2016 2015 (unaudited) (unaudited) Beginning balance $ 187 $ 168 Cost of warranty claims (42 ) (13 ) Accruals for product warranties 60 9 Ending balance $ 205 $ 164 |
Note 8 - Commitments
Note 8 - Commitments | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Commitments Disclosure [Text Block] | NOTE 8 –CO MMITMENTS Lease Agreements Qualstar’s lease agreement for its 15,160 square foot facility located in Simi Valley, California, expires on February 28, 2018. Rent on this facility is $10,000 per month with a step-up of 3% annually. On July 1, 2015, Qualstar Corporation entered into a one year sublease agreement with Interlink Electronics, Inc. (Interlink). The sublease agreement is for 608 square feet of space in the Qualstar building located at 130 West Cochran Street, Unit C; Simi Valley, 91361. Qualstar will receive rent of $1,000 per month which is equal to the base rent per square foot in the master lease, plus additional rent for common area services, utilities and other shared expenses. The space will be used for engineering and light manufacturing. As described in Note 13, Interlink is a related party. Qualstar also leases approximately 5,400 square feet of office space in Westlake Village, California. Our lease on this facility expires on January 31, 2020. Rent on this facility is $10,000 per month, with a step-up of 3% annually. On March 21, 2016, we signed a sublease agreement for the Westlake Village facility. The tenant will pay Qualstar $11,000 per month with a step-up of 3% annually. Effective April 1, 2016, a two year lease was signed for 1,359 square feet for $2,200 per month in Singapore , which expires on March 31, 2018. The Company provides for rent expense on a straight-line basis over the lease terms. QUALSTAR CORPORATION AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)-(Continued) Future minimum lease payments under these leases are as follows, in thousands, (unaudited): Years Ending December 31, Minimum Lease Payment Sublease Revenue Net Minimum Lease Payment 2016 $ 272 $ (91 ) $ 181 2017 288 (139 ) 149 2018 161 (143 ) 18 2019 134 (147 ) (13 ) 2020 11 (12 ) (1 ) Total Commitment $ 866 $ (532 ) $ 334 Rent expense for the three months ended March 31, 2016 and 2015 was $64,000 and $108,000, respectively. |
Note 9 - Stock Incentive Plans
Note 9 - Stock Incentive Plans and Share-based Compensation | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | NOTE 9 – STOCK INCENTIVE PLANS AND S HARE- BASED COMPENSATION The Company recorded share-based compensation associated with outstanding stock options during the three months ended March 31, 2016 of approximately $1,000. For the three months ended March 31, 2015 the Company recorded share-based compensation associated with outstanding stock options and restricted stock options of $38,000. No income tax benefit was recognized in the condensed consolidated statements of operations for share-based arrangements in any period presented. At March 31, 2016, the unrecognized compensation cost related to share-based compensation is $1,000. Stock Options The Company did not grant any stock options during the three months ended March 31, 2016 and 2015. Restricted Stock The fair value of our restricted stock is the intrinsic value as of the grant date. There were no restricted stock awards granted in the three months ended March 31, 2016 and 2015. The unvested restricted stock of 100,000 shares granted to the former president of the Company, on April 1, 2014, were forfeited upon the termination of his employment on December 31, 2015. |
Note 10 - Legal Proceedings
Note 10 - Legal Proceedings | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Legal Matters and Contingencies [Text Block] | NOTE 10 – LEGAL PROCEEDINGS The Company is also subject to a variety of claims and legal proceedings that arise from time to time in the ordinary course of our business. Although management currently believes that resolving claims against us, individually or in the aggregate, will not have a material adverse impact on our condensed consolidated financial statements, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future. We accrue loss contingencies in connection with our commitments and contingencies, including litigation, when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. As of March 31 , 2016 we had accrued aggregate current liabilities of $23,000 in probable fees and costs related to these legal matters. |
Note 11 - Income Taxes
Note 11 - Income Taxes | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | NOTE 11 – INCOME TAXES We did not record a provision or benefit for income taxes for the three months ended March 31, 2016 and 2015. The Company has recorded a full valuation allowance against its net deferred tax assets based on the Company’s assessment regarding the realizability of these net deferred tax assets in future periods. |
Note 12 - Segment Information
Note 12 - Segment Information | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | QUALSTAR CORPORATION AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)-(Continued) NOTE 1 2 – SEGMENT INFORMATION In its operation of the business, management reviews certain financial information, including segmented internal profit and loss statements prepared on a basis consistent with U.S. GAAP. Our two segments are Power Supplies and Data Storage. The two segments discussed in this analysis are presented in the way we internally manage and monitor performance for the three months ended March 31, 2016 and 2015. Allocations for internal resources were made for the three months ended March 31, 2016 and 2015. The power supplies segment tracks certain assets separately, and all others are recorded in the storage segment for internal reporting presentations. The types of products and services provided by each segment are summarized below: Power Supplies Data Storage Segment revenue, loss before taxes and total assets were as follows (in thousands): Three Months Ended March 31 , 2016 2015 (unaudited) (unaudited) Revenue Power Supplies $ 1,349 $ 1,582 Data Storage: Product 328 718 Service 473 505 Total data storage 801 1,223 Total revenue $ 2,150 $ 2,805 QUALSTAR CORPORATION AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)-(Continued) Three Months Ended March 31 , 2016 2015 (unaudited) (unaudited) Loss before Income Taxes Power Supplies $ (125 ) $ (188 ) Data Storage (289 ) (299 ) Net loss $ (414 ) $ (487 ) March 31, 2016 December 31 , 2015 (unaudited) Total Assets Cash and cash equivalents $ 3,746 $ 3,963 Power Supplies and Data Storage - Other assets: Power Supplies 1,750 2,092 Data Storage 2,488 2,672 Total Power Supplies and Data Storage - Other assets $ 4,238 $ 4,764 Total Assets $ 7,984 $ 8,727 |
Note 13 - Related Party Transac
Note 13 - Related Party Transactions | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Related Party Transactions Disclosure [Text Block] | NOTE 13 – RELATED PARTY TRANSACTIONS Steven N. Bronson is the Company’s CEO and is also the President and CEO and a majority shareholder of Interlink Electronics, Inc. (“Interlink”). Interlink purchases certain administrative and marketing services from Qualstar. The total amount charged to Interlink for the three months ended March 31, 2016 and 2015 was $2,000 and $17,000, respectively . Interlink owed Qualstar $3,800 and $5,700 for the three months ended March 31, 2016 and 2015, respectively. The Company reimburses Interlink for expenses paid on the Company’s behalf. Interlink, occasionally, pays travel, insurance and other expenses incurred by Qualstar. The Company reimbursed Interlink $11,000 and $1 0,000 for the three months ended March 31, 2016 and 2015. Qualstar owed Interlink $135 and $127 for the three months ended March 31, 2016 and 2015, respectively. On July 1, 2015, Qualstar Corporation entered into a one year sublease agreement with Interlink Electronics, Inc. The sublease agreement is for 608 square feet of space in the Qualstar building located at 130 West Cochran Street, Unit C; Simi Valley, California 91361. Qualstar will receive rent of $1,000 per month which is equal to the base rent per square foot in the master lease, plus additional rent for common area services, utilities and other shared expenses. The space will be used for engineering and light manufacturing. The Company entered into a license agreement, dated May 1, 2014 (the “License Agreement”) with BKF Capital Group, Inc. (“BKF”). Pursuant to the License Agreement, commencing on May 1, 2014, BKF shall have a license to occupy and use one furnished office, telephone and other services, located at Qualstar’s executive offices . Pursuant to the License Agreement, BKF shall pay to Qualstar a license fee $1,200 per month. For the three months ended March 31, 2015, BFK paid $2,400 to Qualstar as license fees. The License Agreement was no longer effective after the Company’s move to the new facilities in February 2015. Steven N. Bronson, the Company’s President and CEO, is also the Chairman, CEO and majority shareholder of BKF. |
Note 14 - Subsequent Events
Note 14 - Subsequent Events | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Subsequent Events [Text Block] | NOTE 14 – SUBSEQUENT EVENTS On March 21, 2016, Qualstar entered into a sublease for the 5,400 square feet of space at the Westlake Village, California facility, effective May 1, 2016. The sublease will begin at $2.10 per square foot per month and the term will remain the same as the master lease, ending January 31, 2020. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation In the opinion of management, the accompanying unaudited condensed consolidated financial statements, including balance sheets and related interim statements of operations and cash flows, include all adjustments, consisting primarily of normal recurring items, which are necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Preparing condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Examples include estimates of loss contingencies, product life cycles and inventory obsolescence, bad debts, sales returns, share-based compensation, forfeiture rates, the potential outcome of future tax consequences of events that have been recognized in our financial statements or tax returns, and determining when investment impairments are other-than-temporary. Actual results and outcomes may differ from management’s estimates and assumptions. The condensed consolidated financial statements include our accounts and the accounts of our wholly-owned subsidiary in Singapore. All significant intercompany accounts and transactions have been eliminated in consolidation. Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in the Qualstar Corporation Annual Report on Form 10-KT for the transition year ended December 31, 2015, filed with the U.S. Securities and Exchange Commission (“SEC”) on March 30, 2016. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition We recognize revenue in accordance with Accounting Standards Codification (“ASC”) 605, “Revenue Recognition,” when there is persuasive evidence that an arrangement exists, title and risk of loss have passed, delivery has occurred or the services have been rendered, the sales price is fixed or determinable and collection of the related receivable is reasonably assured. Title and risk of loss generally pass to our customers upon shipment. In limited circumstances where either title or risk of loss pass upon destination or acceptance or when collection is not reasonably assured, we defer revenue recognition until such events occur. Service contracts are sold by Qualstar to customers for a period of time to provide product support after the warranty expires. The service contracts allow customers to call Qualstar for technical support, replace defective parts and to have onsite service provided by Qualstar’s third party contract service provider. The Company records revenues for contract services at the amount of the service contract, but such amount is deferred at the beginning of the service term and amortized ratably over the life of the contract. Deferred service revenue is shown separately in the condensed consolidated balance sheets as current and long term. At March 31, 2016, we had deferred service revenue of approximately $1,016,000. At December 31, 2015, we had deferred service revenue of approximately $1,098,000. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments We measure fair value on all financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the condensed consolidated financial statements on a recurring basis (at least quarterly). See “Note 5 – Fair Value Measurements.” |
Receivables, Policy [Policy Text Block] | Allowance for Doubtful Accounts We estimate our allowance for doubtful accounts based on an assessment of the collectability of specific accounts and the overall condition of accounts receivable. In evaluating the adequacy of the allowance for doubtful accounts, specific trade receivables, historical bad debts, customer credits, customer credit-worthiness and changes in customers’ payment terms and patterns are analyzed. If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make additional payments, then additional allowances may be needed. Likewise, if it is determined that more of our receivables may be realized in the future than previously estimated, we would adjust the allowance to increase income in the period of this determination. |
Inventory, Policy [Policy Text Block] | Inventory Valuation We record inventories at the lower of cost (first-in, first-out basis) or market value. We assess the value of our inventories periodically based upon numerous factors including expected product or material demand, current market conditions, technological obsolescence, current cost and net realizable value. If necessary, we write down our inventory for estimated obsolescence, potential shrinkage, or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions. If technology changes more rapidly than expected, or market conditions become less favorable than those projected by management, additional inventory write-downs may be required. |
Standard Product Warranty, Policy [Policy Text Block] | Warranty Obligations We provide for the estimated cost of product warranties at the time the related revenue is recognized. We engage in extensive product quality programs and processes, including active monitoring and evaluation of product failure rates, material usage and estimation of service delivery costs incurred in correcting a product failure. However, should actual product failure rates, material usage, or service delivery costs differ from our estimates, then revisions to the estimated warranty liability would be required. Historically, our warranty costs have not been significant. |
Legal Costs, Policy [Policy Text Block] | Legal and Other Contingencies The outcomes of legal proceedings and claims brought against us are subject to significant uncertainty. An estimated loss from a loss contingency such as a legal proceeding or claim is accrued by a charge to income if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. When legal costs that the entity expects to incur in defending itself in connection with a loss contingency accrual are expected to be material, the loss should factor in all costs and, if the legal costs are reasonably estimable, they should be accrued in accordance with ASC 450, regardless of whether a liability can be estimated for the contingency itself. Disclosure of a contingency is required if there is at least a reasonable possibility that a loss has been incurred. Changes in these factors could materially impact our condensed consolidated financial statements. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Share-Based Compensation Share-based compensation is accounted for in accordance with ASC 718, “Compensation – Stock Compensation.” The Black-Scholes option-pricing model is used to determine fair value of the award at the date of grant and recognize compensation expense over the vesting period. The inputs for the model require the use of judgment, estimates and assumptions regarding the expected volatility of the stock, the expected term the average employee will hold the option prior to the date of exercise, expected future dividends, and the amount of share-based awards that are expected to be forfeited. Changes in these inputs and assumptions could occur and actual results could differ from these estimates, and our results of operations could be impacted. |
Income Tax, Policy [Policy Text Block] | Accounting for Income Taxes We estimate our tax liabilities based on current tax laws in the statutory jurisdictions in which we operate in accordance with ASC 740, “Income Taxes.” These estimates include judgments about deferred tax assets and liabilities resulting from temporary differences between assets and liabilities recognized for financial reporting purposes and such amounts recognized for tax purposes, as well as about the realization of deferred tax assets. We may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and income tax disclosures. We maintain a valuation allowance to reduce our deferred tax assets due to the uncertainty surrounding the timing of realizing the benefits of net deferred tax assets in future years. We have considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for such a valuation allowance. In the event we were to determine that we would be able to realize all or part of our net deferred tax asset in the future, the valuation allowance would be decreased accordingly. We may periodically undergo examinations by the federal and state regulatory authorities and the Internal Revenue Service. We may be assessed additional taxes and/or penalties contingent on the outcome of these examinations. Our previous examinations have not resulted in any unfavorable or significant assessments. |
Note 3 - Significant Customer21
Note 3 - Significant Customers, Concentration of Credit Risk, and Geographic Information (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Notes Tables | |
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block] | Three Months Ended March 31 , 2016 2015 (unaudited) (unaudited) Revenue – geographic activity (in thousands): $ % $ % North America $ 1,251 58.2 % $ 1,225 43.7 % Europe 488 22.7 % 485 17.3 % Asia Pacific 402 18.7 % 936 33.3 % Other 9 0.4 % 159 5.7 % $ 2,150 100.0 % $ 2,805 100.0 % |
Note 4 - Net Loss Per Share (Ta
Note 4 - Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three Months Ended March 31, 2016 2015 (unaudited) (unaudited) In thousands (except per share amounts): Net loss (a) $ (414 ) $ (487 ) Weighted average outstanding shares of common stock (b) 12,253 12,253 Dilutive potential common shares from employee stock options — — Common stock and common stock equivalents (c) 12,253 12,253 Loss per share: Basic net loss per share (a)/(b) $ (0.03 ) $ (0.04 ) Diluted net loss per share (a)/(c) $ (0.03 ) $ (0.04 ) |
Note 5 - Fair Value Measureme23
Note 5 - Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Notes Tables | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | Level 1: March 31, 2016 December 31 , 201 5 (unaudited) Cash $ 709 $ 928 Money Market Funds 3,037 3,035 Total cash and cash equivalents $ 3,746 $ 3,963 |
Note 6 - Balance Sheet Details
Note 6 - Balance Sheet Details (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | March 31, 2016 December 31, 2015 (unaudited) Raw materials $ 313 $ 263 Finished goods 1,905 2,181 Net inventory balance $ 2,218 $ 2,444 |
Schedule of Other Accrued Liabilities [Table Text Block] | March 31, 2016 December 31 , 201 5 (unaudited) Accrued commissions $ 37 $ 37 Accrued audit fees 17 149 Deferred rent 52 42 Accrued warranty 205 187 Other accrued liabilities 15 52 Total other accrued liabilities $ 326 $ 467 |
Note 7 - Contingencies (Tables)
Note 7 - Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Notes Tables | |
Schedule of Product Warranty Liability [Table Text Block] | Three months Ended March 31, 2016 2015 (unaudited) (unaudited) Beginning balance $ 187 $ 168 Cost of warranty claims (42 ) (13 ) Accruals for product warranties 60 9 Ending balance $ 205 $ 164 |
Note 8 - Commitments (Tables)
Note 8 - Commitments (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Notes Tables | |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | Years Ending December 31, Minimum Lease Payment Sublease Revenue Net Minimum Lease Payment 2016 $ 272 $ (91 ) $ 181 2017 288 (139 ) 149 2018 161 (143 ) 18 2019 134 (147 ) (13 ) 2020 11 (12 ) (1 ) Total Commitment $ 866 $ (532 ) $ 334 |
Note 12 - Segment Information (
Note 12 - Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
(Loss) Income before Taxes by Segment [Member] | |
Notes Tables | |
Reconciliation of Other Significant Reconciling Items from Segments to Consolidated [Table Text Block] | Three Months Ended March 31 , 2016 2015 (unaudited) (unaudited) Loss before Income Taxes Power Supplies $ (125 ) $ (188 ) Data Storage (289 ) (299 ) Net loss $ (414 ) $ (487 ) |
Reconciliation of Revenue from Segments to Consolidated [Table Text Block] | Three Months Ended March 31 , 2016 2015 (unaudited) (unaudited) Revenue Power Supplies $ 1,349 $ 1,582 Data Storage: Product 328 718 Service 473 505 Total data storage 801 1,223 Total revenue $ 2,150 $ 2,805 |
Reconciliation of Assets from Segment to Consolidated [Table Text Block] | March 31, 2016 December 31 , 2015 (unaudited) Total Assets Cash and cash equivalents $ 3,746 $ 3,963 Power Supplies and Data Storage - Other assets: Power Supplies 1,750 2,092 Data Storage 2,488 2,672 Total Power Supplies and Data Storage - Other assets $ 4,238 $ 4,764 Total Assets $ 7,984 $ 8,727 |
Note 1 - Summary of Significa28
Note 1 - Summary of Significant Accounting Policies (Details Textual) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Deferred Revenue | $ 1,016,000 | $ 1,098,000 |
Note 3 - Significant Customer29
Note 3 - Significant Customers, Concentration of Credit Risk, and Geographic Information (Details Textual) - Customer Concentration Risk [Member] | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Sales Revenue, Net [Member] | Customer 1 [Member] | ||
Concentration Risk, Percentage | 15.00% | 13.70% |
Sales Revenue, Net [Member] | Customer 2 [Member] | ||
Concentration Risk, Percentage | 9.40% | 13.50% |
Sales Revenue, Net [Member] | ||
Number of Major Customers Concentration Risk | 2 | 2 |
Accounts Receivable [Member] | Customer 1 [Member] | ||
Concentration Risk, Percentage | 17.00% | 21.40% |
Accounts Receivable [Member] | Customer 2 [Member] | ||
Concentration Risk, Percentage | 14.40% | 15.60% |
Note 3 - Geographic Activity, R
Note 3 - Geographic Activity, Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
North America [Member] | Geographic Concentration Risk [Member] | Sales Revenue, Services, Net [Member] | ||
Concentration Risk, Percentage | 58.20% | 43.70% |
North America [Member] | ||
Net revenues | $ 1,251 | $ 1,225 |
Europe [Member] | Geographic Concentration Risk [Member] | Sales Revenue, Services, Net [Member] | ||
Concentration Risk, Percentage | 22.70% | 17.30% |
Europe [Member] | ||
Net revenues | $ 488 | $ 485 |
Asia Pacific [Member] | Geographic Concentration Risk [Member] | Sales Revenue, Services, Net [Member] | ||
Concentration Risk, Percentage | 18.70% | 33.30% |
Asia Pacific [Member] | ||
Net revenues | $ 402 | $ 936 |
Other Geographic Areas [Member] | Geographic Concentration Risk [Member] | Sales Revenue, Services, Net [Member] | ||
Concentration Risk, Percentage | 0.40% | 5.70% |
Other Geographic Areas [Member] | ||
Net revenues | $ 9 | $ 159 |
Geographic Concentration Risk [Member] | Sales Revenue, Services, Net [Member] | ||
Concentration Risk, Percentage | 100.00% | 100.00% |
Net revenues | $ 2,150 | $ 2,805 |
Note 4 - Computation of Basic a
Note 4 - Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Net loss (a) | $ (414) | $ (487) |
Weighted average outstanding shares of common stock (b) (in shares) | 12,253 | 12,253 |
Dilutive potential common shares from employee stock options (in shares) | ||
Common stock and common stock equivalents (c) (in shares) | 12,253 | 12,253 |
Basic net loss per share (a)/(b) (in dollars per share) | $ (0.03) | $ (0.04) |
Diluted net loss per share (a)/(c) (in dollars per share) | $ (0.03) | $ (0.04) |
Note 5 - Financial Assets and L
Note 5 - Financial Assets and Liabilities Measured and Recorded at Fair Value On a Recurring Basis (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 | Dec. 31, 2014 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Cash [Member] | ||||
Cash and cash equivalents | $ 709 | $ 928 | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Money Market Funds [Member] | ||||
Cash and cash equivalents | 3,037 | 3,035 | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||||
Cash and cash equivalents | 3,746 | 3,963 | ||
Cash and cash equivalents | $ 3,746 | $ 3,963 | $ 5,453 | $ 5,242 |
Note 6 - Inventories (Details)
Note 6 - Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Raw materials | $ 313 | $ 263 |
Finished goods | 1,905 | 2,181 |
Net inventory balance | $ 2,218 | $ 2,444 |
Note 6 - Other Accrued Liabilit
Note 6 - Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Accrued Audit Fees [Member] | ||
Accrued audit fees | $ 17 | $ 149 |
Other Accrued Liabilities [Member] | ||
Other accrued liabilities | 15 | 52 |
Accrued commissions | 37 | 37 |
Deferred rent | 52 | 42 |
Accrued warranty | 205 | 187 |
Other accrued liabilities | $ 326 | $ 467 |
Note 7 - Contingencies (Details
Note 7 - Contingencies (Details Textual) | 3 Months Ended |
Mar. 31, 2016 | |
Product Warranty Accrual, Tape Libraries Parts and Labor, Term | 3 years |
Product Warranty Accrual, Power Supplies, Term | 3 years |
Note 7 - Product Warranty Liabi
Note 7 - Product Warranty Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Beginning balance | $ 187 | $ 168 |
Cost of warranty claims | (42) | (13) |
Accruals for product warranties | 60 | 9 |
Ending balance | $ 205 | $ 164 |
Note 8 - Commitments (Details T
Note 8 - Commitments (Details Textual) | Apr. 01, 2016USD ($)ft² | Mar. 21, 2016USD ($) | Jul. 01, 2015USD ($)ft² | Mar. 31, 2016USD ($)ft² | Mar. 31, 2015USD ($) | May. 01, 2016ft² |
Simi Valley California [Member] | ||||||
Area of Real Estate Property | ft² | 15,160 | |||||
Operating Lease Monthly Rent | $ 10,000 | |||||
Monthly Rent Step-up Percentage | 3.00% | |||||
Westlake Village, California [Member] | Subsequent Event [Member] | ||||||
Area of Real Estate Property | ft² | 5,400 | |||||
Westlake Village, California [Member] | ||||||
Area of Real Estate Property | ft² | 5,400 | |||||
Operating Lease Monthly Rent | $ 10,000 | |||||
Monthly Rent Step-up Percentage | 3.00% | |||||
Operating Leases, Monthly Sublease Rent | $ 11,000 | |||||
Operating Leases, Sublease, Monthly Rent Step-up Percentage | 3.00% | |||||
Singapore [Member] | Subsequent Event [Member] | ||||||
Area of Real Estate Property | ft² | 1,359 | |||||
Operating Lease Monthly Rent | $ 2,200 | |||||
Lessee Leasing Arrangements, Operating Leases, Term of Contract | 2 years | |||||
Interlink Electronics, Inc. [Member] | Sublease Agreement With Related Party [Member] | Qualstar Facility in Simi Valley [Member] | ||||||
Area of Real Estate Property | ft² | 608 | |||||
Sublease Agreement, Term | 1 year | |||||
Monthly Sublease Revenue | $ 1,000 | |||||
Operating Leases, Rent Expense, Net | $ 64,000 | $ 108,000 |
Note 8 - Future Minimum Lease P
Note 8 - Future Minimum Lease Payments (Details) $ in Thousands | Mar. 31, 2016USD ($) |
2,016 | $ 272 |
2,016 | (91) |
2,016 | 181 |
2,017 | 288 |
2,017 | (139) |
2,017 | 149 |
2,018 | 161 |
2,018 | (143) |
2,018 | 18 |
2,019 | 134 |
2,019 | (147) |
2,019 | (13) |
2,020 | 11 |
2,020 | (12) |
2,020 | (1) |
Total Commitment | 866 |
Total Commitment | (532) |
Total Commitment | $ 334 |
Note 9 - Stock Incentive Plan39
Note 9 - Stock Incentive Plans and Share-based Compensation (Details Textual) - USD ($) | Apr. 01, 2014 | Mar. 31, 2016 | Mar. 31, 2015 |
Restricted Stock [Member] | Executive Vice President [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 100,000 | ||
Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 0 | 0 | |
Allocated Share-based Compensation Expense | $ 1,000 | $ 38,000 | |
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense | 0 | $ 0 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options | $ 1,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 0 |
Note 10 - Legal Proceedings (De
Note 10 - Legal Proceedings (Details Textual) | Mar. 31, 2016USD ($) |
Loss Contingency, Accrual, Current | $ 23,000 |
Note 11 - Income Taxes (Details
Note 11 - Income Taxes (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Tax Expense (Benefit) | $ 0 | $ 0 |
Note 12 - Segment Information42
Note 12 - Segment Information (Details Textual) | 3 Months Ended |
Mar. 31, 2016 | |
Number of Operating Segments | 2 |
Note 12 - Segment Revenue (Deta
Note 12 - Segment Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Power Supplies [Member] | ||
Revenue | ||
Power Supplies | $ 1,349 | $ 1,582 |
Data Storage: | ||
Power Supplies | 1,349 | 1,582 |
Tape Libraries [Member] | Product [Member] | ||
Revenue | ||
Power Supplies | 328 | 718 |
Data Storage: | ||
Power Supplies | 328 | 718 |
Tape Libraries [Member] | Service [Member] | ||
Revenue | ||
Power Supplies | 473 | 505 |
Data Storage: | ||
Power Supplies | 473 | 505 |
Tape Libraries [Member] | ||
Revenue | ||
Power Supplies | 801 | 1,223 |
Data Storage: | ||
Power Supplies | 801 | 1,223 |
Power Supplies | 2,150 | 2,805 |
Power Supplies | $ 2,150 | $ 2,805 |
Note 12 - Income (Loss) Before
Note 12 - Income (Loss) Before Taxes by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Power Supplies [Member] | ||
Loss before taxes | $ (125) | $ (188) |
Data Storage [Member] | ||
Loss before taxes | (289) | (299) |
Loss before taxes | $ (414) | $ (487) |
Note 12 - Total Assets by Segme
Note 12 - Total Assets by Segment (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 | Dec. 31, 2014 |
Power Supplies [Member] | ||||
Power Supplies and Data Storage - Other assets: | ||||
Power Supplies and Data Storage | $ 1,750 | $ 2,092 | ||
Data Storage [Member] | ||||
Power Supplies and Data Storage - Other assets: | ||||
Power Supplies and Data Storage | 2,488 | 2,672 | ||
Cash and cash equivalents | 3,746 | 3,963 | $ 5,453 | $ 5,242 |
Power Supplies and Data Storage | 4,238 | 4,764 | ||
Total Assets | $ 7,984 | $ 8,727 |
Note 13 - Related Party Trans46
Note 13 - Related Party Transactions (Details Textual) | Jul. 01, 2015USD ($)ft² | Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) | May. 01, 2014USD ($) |
Interlink Electronics, Inc. [Member] | Administrative Services Provided to Related Party [Member] | ||||
Revenue from Related Parties | $ 2,000 | $ 17,000 | ||
Interlink Electronics, Inc. [Member] | Reimbursement of Expenses Paid By Related Party [Member] | ||||
Related Party Transaction, Amounts of Transaction | 11,000 | 10,000 | ||
Due to Related Parties | 135 | 127 | ||
Interlink Electronics, Inc. [Member] | Sublease Agreement With Related Party [Member] | Qualstar Facility in Simi Valley [Member] | ||||
Sublease Agreement, Term | 1 year | |||
Area of Real Estate Property | ft² | 608 | |||
Monthly Sublease Revenue | $ 1,000 | |||
Interlink Electronics, Inc. [Member] | ||||
Due from Related Parties | $ 3,800 | 5,700 | ||
BKF Capital Group [Member] | License Agreement [Member] | ||||
Monthly License Fee Receivable | $ 1,200 | |||
Proceeds from License Fees Received | $ 2,400 |
Note 14 - Subsequent Events (De
Note 14 - Subsequent Events (Details Textual) - Westlake Village, California [Member] | May. 01, 2016ft²$ / ft² | Mar. 31, 2016ft² |
Subsequent Event [Member] | ||
Area of Real Estate Property | 5,400 | |
Sublease, Monthly Rent Per Square Foot | $ / ft² | 2.1 | |
Area of Real Estate Property | 5,400 |