Interlink Electronics (LINK) 10-Q 12 Aug 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2016	Aug. 11, 2016
Document and Entity Information
Entity Registrant Name	INTERLINK ELECTRONICS INC
Entity Central Index Key	828,146
Document Type	10-Q
Document Period End Date	Jun. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	No
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		7,328,055
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q2

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 5,404	$ 4,435
Accounts receivable, net	1,735	1,599
Inventories	1,285	1,015
Prepaid expenses and other current assets	208	298
Total current assets	8,632	7,347
Property, plant and equipment, net	312	176
Intangibles, net	9	13
Other assets	61	26
Total assets	9,014	7,562
Current liabilities:
Accounts payable	604	484
Accrued liabilities	286	304
Deferred revenue, current	71	71
Total current liabilities	961	859
Deferred revenue, long term	13	40
Total liabilities	974	899
Commitments and contingencies (See note 9)
Stockholders' equity:
Common stock, $0.001 par value: 30,000 shares authorized, 7,326 and 7,326 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively	7	7
Additional paid-in-capital	60,294	60,251
Accumulated deficit	(52,261)	(53,595)
Total stockholders' equity	8,040	6,663
Total liabilities and stockholders' equity	$ 9,014	$ 7,562

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2016	Dec. 31, 2015
Condensed Consolidated Balance Sheets
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	30,000,000	30,000,000
Common stock, shares issued	7,326,000	7,326,000
Common stock, shares outstanding	7,326,000	7,326,000

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Condensed Consolidated Statements of Income
Revenue, net	$ 3,054	$ 2,841	$ 5,859	$ 5,098
Cost of revenue	1,211	1,387	2,345	2,503
Gross profit	1,843	1,454	3,514	2,595
Operating expenses:
Engineering, research and development	174	257	315	418
Selling, general and administrative	755	746	1,667	1,475
Total operating expenses	929	1,003	1,982	1,893
Income from operations	914	451	1,532	702
Other income
Other income, net	15	30	29	42
Income before income tax expense (benefit)	929	481	1,561	744
Income tax expense (benefit)	180		206	(11)
Net income	$ 749	$ 481	$ 1,355	$ 755
Earnings per share: basic and diluted	$ 0.10	$ 0.06	$ 0.18	$ 0.10
Weighted average common shares outstanding - basic	7,326	7,324	7,326	7,324
Weighted average common shares outstanding - diluted	7,406	7,324	7,400	7,324

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net income	$ 1,355	$ 755
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	34	51
Stock based compensation	43	27
Changes in operating assets and liabilities:
Accounts receivable	(136)	(309)
Inventories	(270)	86
Prepaid expenses and other current assets	90	49
Other assets	(35)	1
Accounts payable	120	(95)
Accrued liabilities	(18)	(19)
Deferred revenue	(27)	(3)
Net cash provided by operations	1,156	543
Cash flows from investing activities:
Purchases of property and equipment	(166)	(41)
Net cash used in investing activities	(166)	(41)
Effect of exchange rate changes on cash and cash equivalents	(21)	(1)
Increase in cash and cash equivalents	969	501
Cash and cash equivalents, beginning of year	4,435	2,386
Cash and cash equivalents, end of year	5,404	2,887
Supplemental disclosure of non-cash activities
Income taxes paid	$ 22	$ 1

THE COMPANY AND ITS SIGNIFICANT

THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2016
THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES
THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES	NOTE 1-THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES Description of Business Interlink Electronics, Inc. designs, develops, manufactures and sells a range of force-sensing technologies that incorporate our proprietary materials technology, firmware and software into a portfolio of standard products and custom solutions. These include sensor components, subassemblies, modules and products that support effective, efficient cursor control and novel 3 dimensional user inputs. Our principal executive office is located at 31248 Oak Crest Drive, Suite 110, Westlake Village, California 91361 and our telephone number is (805) 484-8855. Our website address is www.interlinkelectronics.com . Fiscal Year Our fiscal year is January 1 through December 31. Basis of Presentation The interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. They do not include all of the information and footnotes required by GAAP for complete financial statements. The December 31, 2015 balance sheet data was derived from audited consolidated financial statements, but does not include all disclosures required for annual periods. Therefore, these unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto for the year ended December 31, 2015, included in our Annual Report filed with the SEC on March 25, 2016. The condensed consolidated financial statements included herein are unaudited. However, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly our consolidated financial position and our consolidated results of operations and consolidated cash flows. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for future quarters or the full year. Our condensed consolidated financial statements include the accounts of Interlink Electronics and our subsidiaries in Shenzhen and Hong Kong, China, and Singapore. All inter-company accounts and transactions were eliminated in consolidation. Share and per share amounts and weighted-average grant date fair value reflect the two -for-one stock split effected on February 24, 2015 as well as the stock dividend paid on April 1, 2016 of one quarter of one share of common stock for every one share of common stock issued and outstanding on March 29, 2016. The number of authorized shares, common and preferred, and par values reflect the number of authorized shares and par values subsequent to increases to our common and preferred stock approved by the Board of Directors on February 24, 2015 and March 11, 2016, respectively. Use of Estimates The preparation of condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and disclosures made in the accompanying notes to the condensed consolidated financial statements. Management regularly evaluates estimates and assumptions related to revenue recognitions, allowances for doubtful accounts, warranty reserves, inventory valuations reserves, stock-based compensation, purchased intangible asset valuations and useful lives, asset retirement obligations, and deferred income tax asset valuation allowances. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. The actual results we experience may differ materially and adversely from our original estimates. To the extent there are material differences between the estimates and the actual results, our future results of operations will be affected. Risk and Uncertainties Our future results of operations involve a number of risks and uncertainties. Factors that could affect our business or future results and cause actual results to vary materially from historical results include, but are not limited to, the rapid change in our industry; problems with the performance, reliability or quality of our products; loss of customers; impacts of doing business internationally, including foreign currency fluctuations; potential shortages of the supplies we use to manufacture our products; disruptions in our manufacturing facilities; changes in environmental directives impacting our manufacturing process or product lines; the development of new proprietary technology and the enforcement of intellectual property rights by or against us; our ability to attract and retain qualified employees; and our ability to raise additional capital. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, No. 2014-09, “ Revenue from Contracts with Customers (Topic 606) .” The amendments to this update supersede nearly all existing revenue recognition guidance under GAAP. The standard was originally set to become effective in annual periods beginning after December 15, 2016 and for interim and annual reporting periods thereafter. In August 2015, the FASB issued ASU 2015-14 Revenue from Contracts with Customers; Deferral of the Effective Date, which defers the effective date of ASU 2014-09 for all entities by one year, thereby delaying the effective date of the standard to January 1, 2018, with an option that would permit companies to adopt the standard as early as the original effective date. Early adoption prior to the original effective date is not permitted. The core principle of this Topic is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. This Topic defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. The Company has not yet assessed the impact of ASU 2014-09 on its consolidated financial statements. In June 2014, the FASB issued ASU No. 2014-12, “ Compensation—Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force)”, effective for annual periods and interim periods within those annual periods, beginning after December 15, 2015. This update is intended to resolve the diverse accounting treatment of share-based payment awards whose performance target may be achieved after the requisite service period. An entity may apply the standards (1) prospectively to all share-based payment awards that are granted or modified on or after the effective date, or (2) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. Earlier application is permitted. Effective January 1, 2016, the Company adopted ASU No. 2014-12 and there was no impact to our consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, “ Presentation of Financial Statements – Going Concern (Sub-Topic 205-40) ”, which provides guidance in GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. This update is effective for annual periods ending after December 15, 2016 and for annual periods and interim periods thereafter. Early application is permitted. The Company has not yet assessed the impact of ASU 2014-15 on its consolidated financial statements. In February 2015, the Financial Accounts Standards Board, or FASB, issued ASU 2015-02, “Consolidation (Topic 810),” 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. Effective January 1, 2016, the Company adopted ASU No. 2015-12 and it had no impact on our consolidated financial statments. In July 2015, the FASB issued ASU 2015-11, “ Simplifying the Measurement of Inventory ,” which provides new guidance regarding the measurement of inventory. The new guidance requires most inventory to be measured at the lower of cost or net realizable value. The standard defines net realizable value as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The standard applies to companies other than those that measure inventory using last-in, first-out ("LIFO") or the retail inventory method. The standard will be effective for annual reporting periods beginning after December 15, 2016, including interim periods within those reporting periods. Early application is permitted. The Company has not yet evaluated the impact of the adoption of this accounting standard on its consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes,” which requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. The ASU may be applied prospectively or retrospectively. The Company adopted the ASU No. 2015-17 on January 1, 2016, and it had no impact on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which replaces the existing guidance in ASC 840, Leases . The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years and requires retrospective application. The Company is currently evaluating the impact of ASU 2016-02 to its consolidated financial statements .

INVENTORIES

INVENTORIES	6 Months Ended
	Jun. 30, 2016
INVENTORIES
INVENTORIES	NOTE 2-INVENTORIES Inventories consist of the following: June 30, December 31, 2016 2015 Inventories (in thousands) Raw materials $ $ Work-in-process Finished goods Total inventories $ $

STOCKHOLDERS EQUITY

STOCKHOLDERS EQUITY	6 Months Ended
	Jun. 30, 2016
STOCKHOLDERS EQUITY
STOCKHOLDERS' EQUITY	NOTE 3-STOCKHOLDERS’ EQUITY On February 24, 2015, we completed a two (2) share for one (1) share forward stock split of our common stock, and on April 1, 2016, we completed a stock dividend of one quarter of one share of common stock for every one share of common stock outstanding. All share amounts, exercise prices, and weighted-average grant date fair value for our common stock, stock options and restricted stock reflect the stock splits. In conjunction with the February 24, 2015 stock split, the board of directors authorized the adoption of an amendment to the Articles of Incorporation to increase the Company’s authorized Common Stock from 15,000,000 shares to 30,000,000 shares. The number of authorized shares, common and preferred, and par values in the accompanying unaudited condensed consolidated financial statements have been recast to reflect the number of authorized shares and par values on a post-split basis.

STOCK BASED COMPENSATION

STOCK BASED COMPENSATION	6 Months Ended
	Jun. 30, 2016
STOCK BASED COMPENSATION
STOCK BASED COMPENSATION	NOTE 4-STOCK BASED COMPENSATION Under the terms of our 2016 Omnibus Incentive Plan (the “Plan”), officers and key employees could be granted restricted stock units, as well as non-qualified or incentive stock options. The Plan replaces the 1996 Stock Incentive Plan which was terminated in December 2015; however, all grants issued under the 1996 Stock Incentive Plan prior to its termination will continue to vest, expire or terminate in accordance with the Plan document and the terms of each award. Share amounts and weighted-average grant date fair values reflect the two -for-one stock split effected on February 24, 2015 and the one quarter of one share of common stock for every one share of common stock dividend effected on April 1, 2016. Restricted Stock Units Our outstanding restricted stock unit grants vest over five years in installments of 50% on the fourth anniversary of the grant date and the remaining 50% on the fifth anniversary of the grant date. Unvested restricted shares are forfeited if the recipient’s employment terminates for any reason other than death, disability or special circumstances as determined by the Compensation Committee of the Board of Directors. Activity for our restricted stock units is as follows: Weighted Average Restricted Stock Weighted-Average Grant Remaining Aggregate Intrinsic Units Date Fair Value Contractual Life Value (in thousands) (years) (in thousands) Restricted stock units, December 31, 2015 $ $ Awarded — $ — Released — $ — Forfeited $ Restricted stock units, June 30, 2016 $ $ The aggregate intrinsic values in the preceding table for the restricted stock units outstanding represent the total pretax intrinsic value, based on our closing stock price of $11.78 and $5.71 as of June 30, 2016 and December 31, 2015, respectively. No restricted stock units vested in the six months ended June 30, 2016 or 2015. Stock Options The exercise price of our stock options is the closing price on the date the options are granted. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model. Options generally expire 10 years from the date of grant. The following table summarizes the activity for the remaining options outstanding under the Plan: Weighted Average Weighted Average Remaining Aggregate Intrinsic Shares Exercise Price Contractual Life Value (in thousands) (years) (in thousands) Options outstanding, December 31, 2015 $ $ Granted — $ — Exercised — $ — Cancelled or expired $ Options outstanding, June 30, 2016 $ $ Options exercisable, June 30, 2016 $ $ This intrinsic value represents the excess of the fair market value of our common stock on the date of exercise over the exercise price of such options. The aggregate intrinsic values in the preceding table for the options outstanding represent the total pretax intrinsic value, based on our closing stock price of $11.78 and $5.71 as of June 30, 2016 and December 31, respectively, which would have been received by the option holders had those option holders exercised their in-the-money options as of those dates. The fair value of stock-based option awards is estimated at the date of grant using the Black-Scholes option pricing model; however, the value calculated using an option pricing model may not be indicative of the fair value observed in a willing buyer/willing seller market transaction, or actually realized by the employee upon exercise. Expected volatility used to estimate the fair value of options granted is based on the historical volatility of our common stock. The risk-free interest rate is based on the United States Treasury constant maturity rate for the expected life of the stock option. The expected life of a stock award is the period of time that the award is expected to be outstanding. We have not granted options since 2008. The following table provides additional information in regards to options outstanding as of June 30, 2016: Options Outstanding Options Exercisable Weighted Range of Number Weighted Average Weighted Average Number Average Exercise Exercise Price Outstanding Remaining Contractual Life Exercise Price Exercisable Price (in thousands) (years) (in thousands) $ — - 1.56 $ $ $ - 5.30 $ $ $ $

EARNINGS PER SHARE

EARNINGS PER SHARE	6 Months Ended
	Jun. 30, 2016
EARNINGS PER SHARE
EARNINGS PER SHARE	NOTE 5-EARNINGS PER SHARE Basic earnings per share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period, plus the dilutive effect of outstanding stock options and restricted stock-based awards using the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share: Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 (in thousands) (in thousands) Net income $ $ $ Weighted average outstanding shares of common stock Dilutive potential common shares from stock options and restricted stock units - — Common stock and common stock equivalents Earnings per share: Earnings per share, basic and diluted $ $ $ $ Shares subject to anti-dilutive stock options and restricted stock-based awards excluded from calculation

SIGNIFICANT CUSTOMERS, CONCENTR

SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION	6 Months Ended
	Jun. 30, 2016
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION	NOTE 6-SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION We manage and operate our business through one operating segment. Net revenues from customers equal to, or greater than, 10% of total net revenues are as follows: Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 (in thousands) (in thousands) Customer A % % % % Customer B % * % % * % Customer C % % % % Customer D % % % % Customer E % * % * * Less than 10% of total net revenues Net revenues by geographic area are as follows: Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 (in thousands) (in thousands) United States $ $ $ $ Asia Europe and other Revenue, net $ $ $ $ Revenues by geographic area are based on the country of shipment. The geographic location of distributors and third-party manufacturing service providers may be different from the geographic location of the purchasers and/or ultimate end users. We provide credit only to creditworthy third parties who are subject to our credit verification procedures. Accounts receivable balances are monitored on an ongoing basis, and accounts deemed to have credit risk are fully reserved. At June 30, 2016, four customers accounted for 24% , 21% , 12% and 12% of total accounts receivable, respectively. At December 31, 2015, four customers accounted for approximately 33% , 19% , 14% and 11% of total accounts receivable, respectively. Our allowance for doubtful accounts was nil and $10,000 as of June 30, 2016 and December 31, 2015, respectively. Our long-lived assets were geographically located as follows: June 30, December 31, 2016 2015 (in thousands) United States $ $ Asia Total long-lived assets $ $

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2016
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS	NOTE 7-RELATED PARTY TRANSACTIONS BKF Capital Group - We entered into an agreement, dated March 1, 2015 (the “Agreement”) with BKF Capital Group, Inc. (“BKF”). Pursuant to the Agreement, commencing on March 1, 2015, BKF shall occupy and use one furnished office, telephone and other services, located at our corporate offices. Pursuant to the Agreement, BKF shall pay to the Company a fee of $1,000 per month. BKF paid $3,000 and $4,000 for the three months ended June 30, 2016 and 2015, respectively. BKF paid $6,000 and $4,000 for the six months ended June 30, 2016 and 2015, respectively Steven N. Bronson, our CEO and Chairman, is also the Chairman, CEO and majority shareholder of BKF. Qualstar Corporation (QBAK)- The Company agreed to reimburse, or be reimbursed by, Qualstar Corporation (“Qualstar”) for our occupation and use of a portion of their Simi Valley manufacturing location and other expenses paid by or on behalf of our Company. Steven N. Bronson, our CEO and Chairman, is also the Chairman and CEO of Qualstar. Transactions with Qualstar are as follows: Three months ended June 30, 2016 2015 Due from Qualstar Due to Qualstar Due from Qualstar Due to Qualstar (in thousands) Balance at March 31, $ — $ $ — $ Billed to Qualstar by Interlink — — Paid by Qualstar to Interlink — — — — Billed to Interlink by Qualstar — — Paid by Interlink to Qualstar — — Balance at June 30, $ $ $ $ Six months ended June 30, 2016 2015 Due from Qualstar Due to Qualstar Due from Qualstar Due to Qualstar (in thousands) Balance at January 1, $ — $ $ $ Billed to Qualstar by Interlink — — Paid by Qualstar to Interlink — — Billed to Interlink by Qualstar — — Paid by Interlink to Qualstar — — Balance at June 30, $ $ $ $

INCOME TAXES

INCOME TAXES	6 Months Ended
	Jun. 30, 2016
INCOME TAXES
INCOME TAXES	NOTE 8-INCOME TAXES Income tax expense (benefit) as a percentage of income from operations before incomes taxes was 13.2% for the six months ended June 30, 2016 compared to (1.5)% for the comparable period in the prior year. Our income tax expense (benefit) is primarily impacted by domestic and foreign taxes as well as our ability to utilize our NOLs. During the year ended December 31, 2015 we conducted an IRC Section 382 study to determine if we had experienced an ownership change. The results of the study concluded that the Company experienced an ownership change in February 2010. Of our federal NOL amount as of December 31, 2015, $49.1 million is subject to an annual Section 382 limitation due to the February 2010 ownership change. As of December 31, 2015, the available NOL carryforward is $1.6 million, $2.4 million and $176,000 for federal, state and foreign jurisdictions, respectively. The federal and state NOL carryforward is limited for use by IRC Section 382 at approximately $71,000 per year.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2016
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	NOTE 9-COMMITMENTS AND CONTINGENCIES Operating Leases We lease facilities under non-cancellable operating leases. The leases expire at various dates through fiscal 2020 and frequently include renewal provisions for varying periods of time, provisions which require us to pay taxes, insurance and maintenance costs, and provisions for minimum rent increases. Minimum lease payments, including scheduled rent increases are recognized as rent expenses on a straight-line basis over the term of the lease. Future minimum lease payments under non-cancellable operating leases that have remaining non-cancellable lease terms in excess of one year are as follows: Remaining 2016 2017 2018 2019 Thereafter Total (in thousands) Operating Leases $ $ $ $ $ $ Litigation From time to time, we are involved in legal proceedings in the ordinary course of business, including actions against us which assert or may assert claims or seek to impose fines and penalties in substantial amounts. Related legal defense costs are expensed as incurred. We are not currently a party to any legal proceedings that we believe would reasonably be expected to have a material adverse effect on our business, financial condition or results of operation or cash flows. Warranties We establish reserves for future product warranty costs that are expected to be incurred pursuant to specific warranty provisions with our customers. We generally warrant our products against defects for one year from date of shipment, with certain exceptions in which the warranty period can extend to more than one year based on contractual agreements. Our warranty reserves are established at the time of sale and updated throughout the warranty period based upon numerous factors including historical warranty return rates and expenses over various warranty periods. Historically, our warranty returns have not been material. Intellectual Property Indemnities We indemnify certain customers and our contract manufacturers against liability arising from third-party claims of intellectual property rights infringement related to our products. These indemnities appear in development and supply agreements with our customers as well as manufacturing service agreements with our contract manufacturers, are not limited in amount or duration and generally survive the expiration of the contract. Given that the amount of any potential liabilities related to such indemnities cannot be determined until an infringement claim has been made, we are unable to determine the maximum amount of losses that we could incur related to such indemnifications. Director and Officer Indemnities and Contractual Guarantees We have entered into indemnification agreements with our directors and executive officers, which require us to indemnify such individuals to the fullest extent permitted by Nevada law. Our indemnification obligations under such agreements are not limited in amount or duration. Certain costs incurred in connection with such indemnifications may be recovered under certain circumstances under various insurance policies. Given that the amount of any potential liabilities related to such indemnities cannot be determined until a lawsuit has been filed, we are unable to determine the maximum amount of losses that we could incur relating to such indemnities. We have also entered into severance and change in control agreements with certain of our executives. These agreements provide for the payment of specific compensation benefits to such executives upon the termination of their employment with us. Guarantees and Indemnities In the normal course of business, we are occasionally required to undertake indemnification for which we may be required to make future payments under specific circumstances. We review our exposure under such obligations no less than annually, or more frequently as required. The amount of any potential liabilities related to such obligations cannot be accurately determined until a formal claim is filed. Historically, any such amounts that become payable have not had a material negative effect our business, financial condition or results of operations. We maintain general and product liability insurance which may provide a source of recovery to us in the event of an indemnification claim.

THE COMPANY AND ITS SIGNIFICA15

THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2016
THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES
Description of Business	Description of Business Interlink Electronics, Inc. designs, develops, manufactures and sells a range of force-sensing technologies that incorporate our proprietary materials technology, firmware and software into a portfolio of standard products and custom solutions. These include sensor components, subassemblies, modules and products that support effective, efficient cursor control and novel 3 dimensional user inputs. Our principal executive office is located at 31248 Oak Crest Drive, Suite 110, Westlake Village, California 91361 and our telephone number is (805) 484-8855. Our website address is www.interlinkelectronics.com .
Fiscal Year	Fiscal Year Our fiscal year is January 1 through December 31.
Basis of Presentation	Basis of Presentation The interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. They do not include all of the information and footnotes required by GAAP for complete financial statements. The December 31, 2015 balance sheet data was derived from audited consolidated financial statements, but does not include all disclosures required for annual periods. Therefore, these unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto for the year ended December 31, 2015, included in our Annual Report filed with the SEC on March 25, 2016. The condensed consolidated financial statements included herein are unaudited. However, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly our consolidated financial position and our consolidated results of operations and consolidated cash flows. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for future quarters or the full year. Our condensed consolidated financial statements include the accounts of Interlink Electronics and our subsidiaries in Shenzhen and Hong Kong, China, and Singapore. All inter-company accounts and transactions were eliminated in consolidation. Share and per share amounts and weighted-average grant date fair value reflect the two -for-one stock split effected on February 24, 2015 as well as the stock dividend paid on April 1, 2016 of one quarter of one share of common stock for every one share of common stock issued and outstanding on March 29, 2016. The number of authorized shares, common and preferred, and par values reflect the number of authorized shares and par values subsequent to increases to our common and preferred stock approved by the Board of Directors on February 24, 2015 and March 11, 2016, respectively.
Use of Estimates	Use of Estimates The preparation of condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and disclosures made in the accompanying notes to the condensed consolidated financial statements. Management regularly evaluates estimates and assumptions related to revenue recognitions, allowances for doubtful accounts, warranty reserves, inventory valuations reserves, stock-based compensation, purchased intangible asset valuations and useful lives, asset retirement obligations, and deferred income tax asset valuation allowances. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. The actual results we experience may differ materially and adversely from our original estimates. To the extent there are material differences between the estimates and the actual results, our future results of operations will be affected.
Risk and Uncertainties	Risk and Uncertainties Our future results of operations involve a number of risks and uncertainties. Factors that could affect our business or future results and cause actual results to vary materially from historical results include, but are not limited to, the rapid change in our industry; problems with the performance, reliability or quality of our products; loss of customers; impacts of doing business internationally, including foreign currency fluctuations; potential shortages of the supplies we use to manufacture our products; disruptions in our manufacturing facilities; changes in environmental directives impacting our manufacturing process or product lines; the development of new proprietary technology and the enforcement of intellectual property rights by or against us; our ability to attract and retain qualified employees; and our ability to raise additional capital.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, No. 2014-09, “ Revenue from Contracts with Customers (Topic 606) .” The amendments to this update supersede nearly all existing revenue recognition guidance under GAAP. The standard was originally set to become effective in annual periods beginning after December 15, 2016 and for interim and annual reporting periods thereafter. In August 2015, the FASB issued ASU 2015-14 Revenue from Contracts with Customers; Deferral of the Effective Date, which defers the effective date of ASU 2014-09 for all entities by one year, thereby delaying the effective date of the standard to January 1, 2018, with an option that would permit companies to adopt the standard as early as the original effective date. Early adoption prior to the original effective date is not permitted. The core principle of this Topic is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. This Topic defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. The Company has not yet assessed the impact of ASU 2014-09 on its consolidated financial statements. In June 2014, the FASB issued ASU No. 2014-12, “ Compensation—Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force)”, effective for annual periods and interim periods within those annual periods, beginning after December 15, 2015. This update is intended to resolve the diverse accounting treatment of share-based payment awards whose performance target may be achieved after the requisite service period. An entity may apply the standards (1) prospectively to all share-based payment awards that are granted or modified on or after the effective date, or (2) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. Earlier application is permitted. Effective January 1, 2016, the Company adopted ASU No. 2014-12 and there was no impact to our consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, “ Presentation of Financial Statements – Going Concern (Sub-Topic 205-40) ”, which provides guidance in GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. This update is effective for annual periods ending after December 15, 2016 and for annual periods and interim periods thereafter. Early application is permitted. The Company has not yet assessed the impact of ASU 2014-15 on its consolidated financial statements. In February 2015, the Financial Accounts Standards Board, or FASB, issued ASU 2015-02, “Consolidation (Topic 810),” 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. Effective January 1, 2016, the Company adopted ASU No. 2015-12 and it had no impact on our consolidated financial statments. In July 2015, the FASB issued ASU 2015-11, “ Simplifying the Measurement of Inventory ,” which provides new guidance regarding the measurement of inventory. The new guidance requires most inventory to be measured at the lower of cost or net realizable value. The standard defines net realizable value as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The standard applies to companies other than those that measure inventory using last-in, first-out ("LIFO") or the retail inventory method. The standard will be effective for annual reporting periods beginning after December 15, 2016, including interim periods within those reporting periods. Early application is permitted. The Company has not yet evaluated the impact of the adoption of this accounting standard on its consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes,” which requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. The ASU may be applied prospectively or retrospectively. The Company adopted the ASU No. 2015-17 on January 1, 2016, and it had no impact on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which replaces the existing guidance in ASC 840, Leases . The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years and requires retrospective application. The Company is currently evaluating the impact of ASU 2016-02 to its consolidated financial statements

INVENTORIES (Tables)

INVENTORIES (Tables)	6 Months Ended
	Jun. 30, 2016
INVENTORIES
Schedule of inventories	June 30, December 31, 2016 2015 Inventories (in thousands) Raw materials $ $ Work-in-process Finished goods Total inventories $ $

STOCK BASED COMPENSATION (Table

STOCK BASED COMPENSATION (Tables)	6 Months Ended
	Jun. 30, 2016
STOCK BASED COMPENSATION
Schedule of activity for restricted stock units	Weighted Average Restricted Stock Weighted-Average Grant Remaining Aggregate Intrinsic Units Date Fair Value Contractual Life Value (in thousands) (years) (in thousands) Restricted stock units, December 31, 2015 $ $ Awarded — $ — Released — $ — Forfeited $ Restricted stock units, June 30, 2016 $ $
Schedule of activity for remaining options outstanding under the plan	Weighted Average Weighted Average Remaining Aggregate Intrinsic Shares Exercise Price Contractual Life Value (in thousands) (years) (in thousands) Options outstanding, December 31, 2015 $ $ Granted — $ — Exercised — $ — Cancelled or expired $ Options outstanding, June 30, 2016 $ $ Options exercisable, June 30, 2016 $ $
Schedule of additional information in regards to options outstanding	Options Outstanding Options Exercisable Weighted Range of Number Weighted Average Weighted Average Number Average Exercise Exercise Price Outstanding Remaining Contractual Life Exercise Price Exercisable Price (in thousands) (years) (in thousands) $ — - 1.56 $ $ $ - 5.30 $ $ $ $

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	6 Months Ended
	Jun. 30, 2016
EARNINGS PER SHARE
Schedule of computation of basic and diluted earnings per share	Three Months Ended Six Months Ended June 30, June 30, 2016 2015 2016 2015 (in thousands) (in thousands) Net income $ $ $ Weighted average outstanding shares of common stock Dilutive potential common shares from stock options and restricted stock units - — Common stock and common stock equivalents Earnings per share: Earnings per share, basic and diluted $ $ $ $ Shares subject to anti-dilutive stock options and restricted stock-based awards excluded from calculation

SIGNIFICANT CUSTOMERS, CONCEN19

SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION (Tables)	6 Months Ended
	Jun. 30, 2016
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION
Schedule of net revenues from customers	Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 (in thousands) (in thousands) Customer A % % % % Customer B % * % % * % Customer C % % % % Customer D % % % % Customer E % * % * * Less than 10% of total net revenues
Schedule of net revenues by geographical area	Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 (in thousands) (in thousands) United States $ $ $ $ Asia Europe and other Revenue, net $ $ $ $
Schedule of assets by geographical area	June 30, December 31, 2016 2015 (in thousands) United States $ $ Asia Total long-lived assets $ $

RELATED PARTY TRANSACTIONS (Tab

RELATED PARTY TRANSACTIONS (Tables)	6 Months Ended
	Jun. 30, 2016
RELATED PARTY TRANSACTIONS
Schedule of related party transactions	Three months ended June 30, 2016 2015 Due from Qualstar Due to Qualstar Due from Qualstar Due to Qualstar (in thousands) Balance at March 31, $ — $ $ — $ Billed to Qualstar by Interlink — — Paid by Qualstar to Interlink — — — — Billed to Interlink by Qualstar — — Paid by Interlink to Qualstar — — Balance at June 30, $ $ $ $ Six months ended June 30, 2016 2015 Due from Qualstar Due to Qualstar Due from Qualstar Due to Qualstar (in thousands) Balance at January 1, $ — $ $ $ Billed to Qualstar by Interlink — — Paid by Qualstar to Interlink — — Billed to Interlink by Qualstar — — Paid by Interlink to Qualstar — — Balance at June 30, $ $ $ $

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	6 Months Ended
	Jun. 30, 2016
COMMITMENTS AND CONTINGENCIES
Schedule of future minimum lease payments under non-cancellable operating leases	Remaining 2016 2017 2018 2019 Thereafter Total (in thousands) Operating Leases $ $ $ $ $ $

THE COMPANY AND ITS SIGNIFICA22

THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES (Details)	Feb. 24, 2015	Apr. 01, 2016shares
THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES
Stock spilt	2
Common stock dividend for each outstanding share (in shares)		0.25

INVENTORIES (Details)

INVENTORIES (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Inventories
Raw materials	$ 688	$ 681
Work-in-process	365	172
Finished goods	232	162
Total inventories	$ 1,285	$ 1,015

STOCKHOLDERS EQUITY (Details)

STOCKHOLDERS EQUITY (Details)	Feb. 24, 2015shares	Jun. 30, 2016shares	Apr. 01, 2016shares	Dec. 31, 2015shares	Feb. 23, 2015shares
STOCKHOLDERS EQUITY
Stock spilt	2
Common stock dividend for each outstanding share (in shares)			0.25
Common stock, shares authorized	30,000,000	30,000,000		30,000,000	15,000,000

STOCK BASED COMPENSATION - Rest

STOCK BASED COMPENSATION - Restricted Stock Units (Details) $ / shares in Units, $ in Thousands	Feb. 24, 2015	Jun. 30, 2016USD ($)$ / sharesshares	Jun. 30, 2015shares	Dec. 31, 2015USD ($)$ / sharesshares	Apr. 01, 2016shares
Restricted Stock Units
Stock spilt	2
Common stock dividend for each outstanding share (in shares)					0.25
Restricted Stock Units
Restricted Stock Units
Vesting period		5 years
Restricted Stock Units
Restricted stock units at the beginning of the period (in shares)		161,000
Awarded (in shares)
Released (in shares)		0	0
Forfeited (in shares)		(6,000)
Restricted stock units at the end of the period (in shares)		155,000		161,000
Weighted-Average Grant Date Fair Value
Restricted stock units at the beginning of the period (in dollars per share) | $ / shares		$ 3.16
Awarded (in dollars per share) | $ / shares
Forfeited (in dollars per share) | $ / shares		6
Restricted stock units at the end of the period (in dollars per share) | $ / shares		$ 3.05		$ 3.16
Weighted Average Remaining Contractual Life
Restricted stock units		2 years 8 months 19 days		3 years 3 months 18 days
Aggregate Intrinsic Value
Restricted stock units | $		$ 1,826		$ 921
Stock price | $ / shares		$ 11.78		$ 5.71
Restricted Stock Units | First installment
Restricted Stock Units
Vesting (as a percent)		50.00%
Restricted Stock Units | Second installment
Restricted Stock Units
Vesting (as a percent)		50.00%

STOCK BASED COMPENSATION - Stoc

STOCK BASED COMPENSATION - Stock Options (Details) - Stock Options - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2016	Dec. 31, 2015
Stock Options
Expiration period	10 years
Shares
Options outstanding at the beginning of the period (in shares)	18
Cancelled or expired (in shares)	(6)
Options outstanding at the end of the period (in share)	12	18
Options exercisable at the end of the period (in shares)	12
Weighted Average Exercise Price
Options outstanding at the beginning of the period (in dollars per share)	$ 4.70
Cancelled or expired (in dollars per share)	6.32
Options outstanding at the end of the period (in dollars per share)	3.80	$ 4.70
Options exercisable at the end of the period (in dollars per share)	$ 3.80
Weighted Average Remaining Contractual Life
Options outstanding	1 year 1 month 13 days	1 year 1 month 10 days
Options exercisable	1 year 1 month 13 days
Intrinsic value of options outstanding	$ 93	$ 22
Intrinsic value of options exercisable	$ 93
Stock price	$ 11.78	$ 5.71

STOCK BASED COMPENSATION - Opti

STOCK BASED COMPENSATION - Option Pricing (Details) shares in Thousands	6 Months Ended
	Jun. 30, 2016$ / sharesshares
Exercise price ranges
Number Outstanding (in shares) | shares	12
Weighted Average Remaining Contractual Life	1 year 1 month 13 days
Weighted Average Exercise Price (in dollars per share)	$ 3.80
Number Exercisable | shares	12
Weighted Average Exercise Price (in dollars per share)	$ 3.80
$0 - $1.56
Exercise price ranges
Exercise price range, upper limit (in dollars per share)	$ 1.56
Number Outstanding (in shares) | shares	4
Weighted Average Remaining Contractual Life	1 year 9 months 7 days
Weighted Average Exercise Price (in dollars per share)	$ 1.56
Number Exercisable | shares	4
Weighted Average Exercise Price (in dollars per share)	$ 1.56
$4.80 - $5.30
Exercise price ranges
Exercise price range, lower limit (in dollars per share)	4.80
Exercise price range, upper limit (in dollars per share)	$ 5.30
Number Outstanding (in shares) | shares	8
Weighted Average Remaining Contractual Life	9 months 15 days
Weighted Average Exercise Price (in dollars per share)	$ 4.97
Number Exercisable | shares	8
Weighted Average Exercise Price (in dollars per share)	$ 4.97

EARNINGS PER SHARE (Details)

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Basic and diluted earnings
Net income	$ 749	$ 481	$ 1,355	$ 755
Weighted average outstanding shares of common stock	7,326	7,324	7,326	7,324
Dilutive potential common shares from stock options and restricted stock units	80		74
Common stock and common stock equivalents	7,406	7,324	7,400	7,324
Earnings per share:
Earnings per share , basic and diluted	$ 0.10	$ 0.06	$ 0.18	$ 0.10
Shares subject to anti-dilutive stock options and restricted stock-based awards excluded from calculation	87	124	93	123

SIGNIFICANT CUSTOMERS, CONCEN29

SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION (Details)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2016USD ($)	Jun. 30, 2015USD ($)	Jun. 30, 2016USD ($)segmentcustomer	Jun. 30, 2015USD ($)	Dec. 31, 2015USD ($)customer
Significant Customers, Concentration of Credit Risk and Geographic Information
Number of operating segments | segment			1
Revenue, net	$ 3,054,000	$ 2,841,000	$ 5,859,000	$ 5,098,000
Allowance for doubtful accounts	$ 0		$ 0		$ 10,000
Net revenue | Customer Concentration Risk | Customer A
Significant Customers, Concentration of Credit Risk and Geographic Information
Concentration risk (as a percent)	20.00%	23.00%	20.00%	20.00%
Net revenue | Customer Concentration Risk | Customer B
Significant Customers, Concentration of Credit Risk and Geographic Information
Concentration risk (as a percent)	14.00%		13.00%
Net revenue | Customer Concentration Risk | Customer C
Significant Customers, Concentration of Credit Risk and Geographic Information
Concentration risk (as a percent)	12.00%	16.00%	11.00%	19.00%
Net revenue | Customer Concentration Risk | Customer D
Significant Customers, Concentration of Credit Risk and Geographic Information
Concentration risk (as a percent)	12.00%	23.00%	10.00%	20.00%
Net revenue | Customer Concentration Risk | Customer E
Significant Customers, Concentration of Credit Risk and Geographic Information
Concentration risk (as a percent)	10.00%		10.00%
Net revenue | Geographic Concentration Risk
Significant Customers, Concentration of Credit Risk and Geographic Information
Revenue, net	$ 3,054,000	$ 2,841,000	$ 5,859,000	$ 5,098,000
Net revenue | Geographic Concentration Risk | United states
Significant Customers, Concentration of Credit Risk and Geographic Information
Revenue, net	1,913,000	1,576,000	3,492,000	2,872,000
Net revenue | Geographic Concentration Risk | Asia
Significant Customers, Concentration of Credit Risk and Geographic Information
Revenue, net	632,000	862,000	1,317,000	1,387,000
Net revenue | Geographic Concentration Risk | Europe and other
Significant Customers, Concentration of Credit Risk and Geographic Information
Revenue, net	509,000	$ 403,000	$ 1,050,000	$ 839,000
Accounts receivable | Credit Concentration Risk
Significant Customers, Concentration of Credit Risk and Geographic Information
Number of customers | customer			4		4
Accounts receivable | Credit Concentration Risk | Customer One
Significant Customers, Concentration of Credit Risk and Geographic Information
Concentration risk (as a percent)			24.00%		33.00%
Accounts receivable | Credit Concentration Risk | Customer Two
Significant Customers, Concentration of Credit Risk and Geographic Information
Concentration risk (as a percent)			21.00%		19.00%
Accounts receivable | Credit Concentration Risk | Customer Three
Significant Customers, Concentration of Credit Risk and Geographic Information
Concentration risk (as a percent)			12.00%		14.00%
Accounts receivable | Credit Concentration Risk | Customer Four
Significant Customers, Concentration of Credit Risk and Geographic Information
Concentration risk (as a percent)			12.00%		11.00%
Assets | Geographic Concentration Risk
Significant Customers, Concentration of Credit Risk and Geographic Information
Total long-lived assets	321,000		$ 321,000		$ 189,000
Assets | Geographic Concentration Risk | United states
Significant Customers, Concentration of Credit Risk and Geographic Information
Total long-lived assets	60,000		60,000		45,000
Assets | Geographic Concentration Risk | Asia
Significant Customers, Concentration of Credit Risk and Geographic Information
Total long-lived assets	$ 261,000		$ 261,000		$ 144,000

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details)	Mar. 01, 2016USD ($)item	Jun. 30, 2016USD ($)	Jun. 30, 2015USD ($)	Jun. 30, 2016USD ($)	Jun. 30, 2015USD ($)
BKF Capital
RELATED PARTY TRANSACTIONS
Number of offices leased out | item	1
Revenue from related parties per month	$ 1,000
Revenue from related parties		$ 3,000	$ 4,000	$ 6,000	$ 4,000
Qualstar
Due from Qualstar
Due from Qualstar, beginning balance					5,000
Billed to Qualstar by Interlink		4,000	1,000	6,000	11,000
Paid by Qualstar to Interlink				(2,000)	(15,000)
Due from Qualstar, end balance		4,000	1,000	4,000	1,000
Due to Qualstar
Due to Qualstar, beginning balance		4,000	6,000	6,000	2,000
Billed to Interlink by Qualstar		9,000	13,000	20,000	30,000
Paid by Interlink to Qualstar		(10,000)	(15,000)	(23,000)	(28,000)
Due to Qualstar, end balance		$ 3,000	$ 4,000	$ 3,000	$ 4,000

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Operating Loss Carryforwards [Line Items]
Income tax expense (benefit) (as a percent)	13.20%	(1.50%)
Annual NOL carryforward available for use			$ 71,000
Federal
Operating Loss Carryforwards [Line Items]
NOL amount subject to section 382 limitation due to ownership change			49,100,000
Operating Loss Carryforwards			1,600,000
State
Operating Loss Carryforwards [Line Items]
Operating Loss Carryforwards			2,400,000
Foreign
Operating Loss Carryforwards [Line Items]
Operating Loss Carryforwards			$ 176,000

COMMITMENTS AND CONTINGENCIES32

COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2016USD ($)
Future minimum lease payments under non-cancellable operating leases
Remaining 2,016	$ 128
2,017	220
2,018	184
2,019	187
Thereafter	195
Total	$ 914
Minimum
Future minimum lease payments under non-cancellable operating leases
Period of warranty from date of shipment	1 year