Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Apr. 03, 2015 | Apr. 30, 2015 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 3-Apr-15 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | HLIT | |
Entity Registrant Name | HARMONIC INC | |
Entity Central Index Key | 851310 | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 88,532,963 |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Apr. 03, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $79,656 | $73,032 |
Short-term investments | 22,203 | 31,847 |
Accounts receivable, net | 75,864 | 74,144 |
Inventories | 31,518 | 32,747 |
Deferred income taxes, short-term | 3,375 | 3,375 |
Prepaid expenses and other current assets | 30,526 | 17,539 |
Total current assets | 243,142 | 232,684 |
Property and equipment, net | 27,140 | 27,221 |
Goodwill | 197,776 | 197,884 |
Intangibles, net | 8,692 | 10,599 |
Other assets | 10,097 | 12,130 |
Total assets | 486,847 | 480,518 |
Current liabilities: | ||
Accounts payable | 18,497 | 15,318 |
Income taxes payable | 320 | 893 |
Deferred revenue | 48,124 | 38,601 |
Accrued liabilities | 29,248 | 35,118 |
Total current liabilities | 96,189 | 89,930 |
Income taxes payable, long-term | 5,032 | 4,969 |
Deferred tax liabilities, long-term | 3,095 | 3,095 |
Other non-current liabilities | 11,007 | 10,711 |
Total liabilities | 115,323 | 108,705 |
Commitments and contingencies (Note 16) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued or outstanding | 0 | 0 |
Common stock, $0.001 par value, 150,000 shares authorized; 88,750 and 87,700 shares issued and outstanding at April 3, 2015 and December 31, 2014, respectively | 89 | 88 |
Additional paid-in capital | 2,265,055 | 2,261,952 |
Accumulated deficit | -1,890,904 | -1,888,247 |
Accumulated other comprehensive loss | -2,716 | -1,980 |
Total stockholders’ equity | 371,524 | 371,813 |
Total liabilities and stockholders’ equity | $486,847 | $480,518 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Apr. 03, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 88,750,000 | 87,700,000 |
Common stock, shares outstanding | 88,750,000 | 87,700,000 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Income Statement [Abstract] | ||
Product revenue | $80,473 | $88,260 |
Service revenue | 23,543 | 19,772 |
Net revenue | 104,016 | 108,032 |
Product cost of revenue | 35,460 | 44,606 |
Service cost of revenue | 13,528 | 11,114 |
Total cost of revenue | 48,988 | 55,720 |
Gross profit | 55,028 | 52,312 |
Operating expenses: | ||
Research and development | 22,329 | 23,888 |
Selling, general and administrative | 31,196 | 33,547 |
Amortization of intangibles | 1,446 | 1,950 |
Restructuring and related charges | 44 | 149 |
Total operating expenses | 55,015 | 59,534 |
Income (loss) from operations | 13 | -7,222 |
Interest income, net | 55 | 77 |
Other income (expense), net | -506 | 12 |
Loss on impairment of long-term investment | -2,505 | 0 |
Loss before income taxes | -2,943 | -7,133 |
Benefit from income taxes | -286 | -1,723 |
Net loss | ($2,657) | ($5,410) |
Net loss per share: | ||
Basic | ($0.03) | ($0.06) |
Diluted | ($0.03) | ($0.06) |
Shares used in per share calculation: | ||
Basic | 88,655 | 97,921 |
Diluted | 88,655 | 97,921 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Net loss | ($2,657) | ($5,410) |
Other comprehensive income (loss) before tax: | ||
Unrealized losses arising during the period | -184 | 0 |
Gains reclassified into earnings | -49 | 0 |
Change in unrealized losses on cash flow hedges: | -233 | 0 |
Change in unrealized gains on available-for-sale securities: | 485 | 7 |
Change in foreign currency translation adjustments | -984 | 40 |
Other comprehensive income (loss) before tax | -732 | 47 |
Provision for (benefit from) income taxes | 4 | -1 |
Other comprehensive income (loss), net of tax | -736 | 48 |
Total Comprehensive loss | ($3,393) | ($5,362) |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Cash flows from operating activities: | ||
Net loss | ($2,657) | ($5,410) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Amortization of intangibles | 1,907 | 6,666 |
Depreciation | 3,493 | 4,227 |
Stock-based compensation | 4,134 | 3,807 |
Loss on impairment of long-term investment | 2,505 | 0 |
Deferred income taxes, net | 0 | 3,510 |
Provision for excess and obsolete inventories | 454 | 722 |
Allowance for doubtful accounts, returns and discounts | -367 | -536 |
Excess tax benefits from stock-based compensation | -120 | -185 |
Other non-cash adjustments, net | 154 | 462 |
Changes in assets and liabilities: | ||
Accounts receivable | -1,353 | -1,927 |
Inventories | 775 | 5,900 |
Prepaid expenses and other assets | -13,062 | -6,671 |
Accounts payable | 3,380 | -2,533 |
Deferred revenue | 10,105 | 6,382 |
Income taxes payable | -501 | 278 |
Accrued and other liabilities | -6,819 | -3,447 |
Net cash provided by operating activities | 2,028 | 11,245 |
Cash flows from investing activities: | ||
Purchases of investments | 0 | -14,084 |
Proceeds from maturities of investments | 9,497 | 15,382 |
Purchases of property and equipment | -3,651 | -3,431 |
Purchases of long-term investments | 85 | 0 |
Net cash provided by (used in) investing activities | 5,761 | -2,133 |
Cash flows from financing activities: | ||
Payments for repurchase of common stock | -5,182 | -29,075 |
Proceeds from (repurchases of) common stock issued to employees | 4,032 | -1,377 |
Excess tax benefits from stock-based compensation | 120 | 185 |
Net cash used in financing activities | -1,030 | -30,267 |
Effect of exchange rate changes on cash and cash equivalents | -135 | 18 |
Net increase (decrease) in cash and cash equivalents | 6,624 | -21,137 |
Cash and cash equivalents at beginning of period | 73,032 | 90,329 |
Cash and cash equivalents at end of period | $79,656 | $69,192 |
Basis_of_Presentation_and_Sign
Basis of Presentation and Significant Accounting Policies | 3 Months Ended |
Apr. 03, 2015 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES |
Basis of Presentation | |
The accompanying unaudited condensed consolidated financial statements, in the opinion of management, include all adjustments (consisting only of normal recurring adjustments) which Harmonic Inc. (“Harmonic,” or the “Company”) considers necessary for a fair statement of the results of operations for the interim periods covered and the consolidated financial condition of the Company at the date of the balance sheets. This Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements contained in the Company’s Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission on March 2, 2015 (“2014 Form 10-K”). The interim results presented herein are not necessarily indicative of the results of operations that may be expected for the full fiscal year ending December 31, 2015, or any other future period. The Company’s fiscal quarters are based on 13-week periods, except for the fourth quarter, which ends on December 31. | |
The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The year-end condensed balance sheet was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“U.S. GAAP”). | |
Use of Estimates | |
The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |
Significant Accounting Policies | |
The Company’s significant accounting policies are described in Note 2 to its audited Consolidated Financial Statements included in its 2014 Form 10-K. There have been no significant changes to these policies during the three months ended April 3, 2015. |
Recent_Accounting_Pronouncemen
Recent Accounting Pronouncements | 3 Months Ended |
Apr. 03, 2015 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | RECENT ACCOUNTING PRONOUNCEMENTS |
On May 28, 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers”, requiring an entity to recognize the amount of revenue that reflects the consideration to which it expects to be entitled for the transfer of promised goods or services to customers. The updated standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. Early adoption is not permitted. The updated standard becomes effective for the Company in the first quarter of fiscal 2017. In April 2015, the FASB announced a proposal to defer the effective date by one year, with early adoption on the original effective date permitted. The Company has not yet selected a transition method and it is currently evaluating the effect that the updated standard will have on its consolidated financial statements and related disclosures. | |
On November 3, 2014, the FASB issued ASU No. 2014-16, “Derivatives and Hedging (Topic 815) - Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share is More Akin to Debt or to Equity”. ASU 2014-16 was issued to clarify how current U.S. GAAP should be interpreted in evaluating the economic characteristics and risk of a host contract in a hybrid financial instrument that is issued in the form of a share. In addition, ASU 2014-16 was issued to clarify that in evaluating the nature of a host contract, an entity should assess the substance of the relevant terms and features (that is, the relative strength of the debt-like or equity-like terms and features given the facts and circumstances) when considering how to weight those terms and features. ASU 2014-16 is effective in the fiscal year beginning after December 15, 2015. Early adoption in an interim period is permitted. The Company is currently evaluating the impact of the adoption of ASU 2014-16 on its consolidated financial statements. | |
On February 18, 2015, the FASB issued ASU No. 2015-02, “Consolidation (Topic 810) - Amendments to the Consolidation Analysis”, intended to improve targeted areas of consolidation guidance for all entities. ASU 2015-02 is effective in the fiscal year beginning after December 15, 2015. Early adoption in an interim period is permitted. The Company is currently evaluating the impact of the adoption of ASU 2015-02 on its consolidated financial statements. | |
On April 15, 2015, the FASB issued ASU No. 2015-05, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) - Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement”. ASU 2015-05 amends ASC 350-40 to provide customers with guidance on whether a cloud computing arrangement contains a software license to be accounted for as internal-use software. ASU No. 2015-05 is effective in the fiscal year beginning after December 15, 2015. Early adoption in an interim period is permitted. The Company is currently evaluating the impact of the adoption of ASU 2015-05 on its consolidated financial statements. |
ShortTerm_Investments
Short-Term Investments | 3 Months Ended | |||||||||||||||
Apr. 03, 2015 | ||||||||||||||||
Cash and Cash Equivalents [Abstract] | ||||||||||||||||
Short-Term Investments | SHORT-TERM INVESTMENTS | |||||||||||||||
The following table summarizes the Company’s short-term investments (in thousands): | ||||||||||||||||
Amortized | Gross | Gross | Estimated | |||||||||||||
Cost | Unrealized | Unrealized | Fair Value | |||||||||||||
Gains | Losses | |||||||||||||||
As of April 3, 2015 | ||||||||||||||||
State, municipal and local government agencies bonds | $ | 11,228 | $ | 10 | $ | — | $ | 11,238 | ||||||||
Corporate bonds | 10,969 | 1 | (5 | ) | 10,965 | |||||||||||
Total short-term investments | $ | 22,197 | $ | 11 | $ | (5 | ) | $ | 22,203 | |||||||
As of December 31, 2014 | ||||||||||||||||
State, municipal and local government agencies bonds | $ | 13,946 | $ | 16 | $ | (1 | ) | $ | 13,961 | |||||||
Corporate bonds | 17,899 | 3 | (16 | ) | 17,886 | |||||||||||
Total short-term investments | $ | 31,845 | $ | 19 | $ | (17 | ) | $ | 31,847 | |||||||
The following table summarizes the maturities of the Company’s short-term investments (in thousands): | ||||||||||||||||
3-Apr-15 | 31-Dec-14 | |||||||||||||||
Less than one year | $ | 22,203 | $ | 30,946 | ||||||||||||
Due in 1 - 2 years | — | 901 | ||||||||||||||
Total short-term investments | $ | 22,203 | $ | 31,847 | ||||||||||||
These available-for-sale investments are presented as “Current Assets” in the Condensed Consolidated Balance Sheet as they are available for current operations. Realized gains and losses from the sale of investments for the three months ended April 3, 2015 and March 28, 2014 were not material. | ||||||||||||||||
As of April 3, 2015 and December 31, 2014, $6.7 million and $8.6 million, respectively, of investments in equity securities of other privately and publicly held companies were considered as long-term investments and were included in “Other assets” in the Condensed Consolidated Balance Sheet (See Note 4, “Investments in Other Equity Securities,” for additional information). | ||||||||||||||||
Impairment of Short-term Investments | ||||||||||||||||
The Company monitors its investment portfolio for impairment on a periodic basis. In the event that the carrying value of an investment exceeds its fair value and the decline in value is determined to be other-than-temporary, an impairment charge is recorded and a new cost basis for the investment is established. A decline of fair value below amortized costs of debt securities is considered other-than-temporary if the Company has the intent to sell the security or it is more likely than not that the Company will be required to sell the security before recovery of the entire amortized cost basis. At the present time, the Company does not intend to sell its investments that have unrealized losses in accumulated other comprehensive loss. In addition, the Company does not believe that it is more likely than not that it will be required to sell its investments that have unrealized losses in accumulated other comprehensive loss before the Company recovers the principal amounts invested. The Company believes that the unrealized losses are temporary and do not require an other-than-temporary impairment, based on its evaluation of available evidence as of April 3, 2015. | ||||||||||||||||
As of April 3, 2015, there were no individual available-for-sale securities in a material unrealized loss position and the amount of unrealized losses on the total investment balance was insignificant. |
Investments_in_Other_Equity_Se
Investments in Other Equity Securities | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Investments, All Other Investments [Abstract] | ||||||||
Investments in Equity Securities | INVESTMENTS IN OTHER EQUITY SECURITIES | |||||||
From time to time, the Company may acquire certain equity investments for the promotion of business objectives and these investments are classified as long-term investments and included in "Other assets" in the Condensed Consolidated Balance Sheet. | ||||||||
On September 2, 2014, the Company acquired a 3.3% interest in Vislink plc (“Vislink”), a U.K. public company listed on the AIM exchange, for $3.3 million, and also made a $3.3 million prepayment for future software license purchases. The investment in Vislink is being accounted for as a cost method investment as the Company does not have significant influence over the operational and financial policies of Vislink. Since the Vislink investment is also an available-for-sale security, its value is marked to market for the difference in fair value at period end. As of April 3, 2015, the carrying value of Vislink was $3.1 million and the accumulated unrealized loss of $0.2 million, net of taxes, on the Vislink investment is included in the Condensed Consolidated Balance Sheet as a component of “Accumulated other comprehensive income (loss)”. As of April 3, 2015, the balance of the prepayment to Vislink for future software license purchase was $1.1 million and it was included in “Prepaid expenses and other current assets” in the Condensed Consolidated Balance Sheet. The Company determined that there were no impairment indicators existing at April 3, 2015 that would indicate that the Vislink investment was impaired and the Company believes the decline in the fair value of the Vislink investment is temporary. As of April 3, 2015, the Company's maximum exposure to loss from the Vislink investment was limited to its initial investment cost of $3.3 million. As of December 31, 2014, the carrying value of Vislink was $2.6 million and the accumulated unrealized loss, net of taxes, was $0.7 million. | ||||||||
Unconsolidated Variable Interest Entities (“VIE”) | ||||||||
VJU | ||||||||
On September 26, 2014, the Company acquired a 19.8% interest in VJU iTV Development GmbH (“VJU”), a software company based in Austria, for $2.5 million. Since VJU's equity is deemed not sufficient to permit it to finance its activities without additional support from its shareholders, VJU is considered a variable interest entity (“VIE”). The Company determined that it is not the primary beneficiary of VJU because its financial interest in VJU's equity and its research and development agreement with VJU do not empower the Company to direct VJU's activities that will most significantly impact VJU's economic performance. VJU is accounted for as a cost method investment as the Company does not have significant influence over the operational and financial policies of VJU. | ||||||||
The Company attended a VJU board meeting on March 5, 2015 as an observer. At that meeting, the Company was made aware of significant decreases in VJU's business prospects, VJU’S existing working capital and prospects for additional funding, compared to the prior information the Company had received from VJU. Based on the Company’s assessment, the Company determined that its investment in VJU was impaired on an other-than-temporary basis. Factors considered included the severity of the impairment and recent events specific to VJU. Based on the Company's assessment of VJU's expected cash flows, the entire investment is expected to be non-recoverable. As a result, the Company recorded an impairment charge of $2.5 million in the first quarter of 2015. The Company's impairment loss in VJU is limited to its initial cost of investment of $2.5 million as well as the $0.1 million research and development cost expensed in September 2014. | ||||||||
EDC | ||||||||
On October 22, 2014, the Company acquired an 18.4% interest in Encoding.com, Inc. (“EDC”), a video transcoding service company headquartered in San Francisco, California, for $3.5 million by purchasing EDC's Series B preferred stock. Since EDC's equity is deemed not sufficient to permit it to finance its activities without additional support from its shareholders, EDC is considered a VIE. The Company determined that it is not the primary beneficiary of EDC because its financial interest in EDC's equity does not empower the Company to direct EDC's activities that will most significantly impact EDC's economic performance. In addition, the Company determined that its investment in EDC's Series B preferred stock does not have the risk and reward characteristics that are substantially similar to EDC’s common stock. Therefore, Harmonic does not hold an investment in EDC’s common stock or in-substance common stock. According to the applicable accounting guidance, the EDC investment is accounted for as a cost-method investment. | ||||||||
The following table presents the carrying values and maximum exposure of the unconsolidated VIEs as of April 3, 2015 (in thousands): | ||||||||
Carrying Value | Maximum exposure to loss(1) | |||||||
VJU | — | — | ||||||
EDC(2) | 3,593 | 3,593 | ||||||
Total | $ | 3,593 | $ | 3,593 | ||||
(1) The Company did not provide financial support to any of its unconsolidated VIEs and as of April 3, 2015, there were no explicit arrangements or implicit variable interests that could require the Company to provide financial support to any of its unconsolidated VIEs. | ||||||||
(2) The Company's maximum exposure to loss with respect to EDC as of April 3, 2015 was limited to a total investment cost of $3.6 million, including $0.1 million of transaction costs. | ||||||||
Each reporting period, the Company reviews all of its unconsolidated VIE investments to determine whether there are any reconsideration events that may result in the Company being a primary beneficiary of the unconsolidated VIE which would then require the Company to consolidate the VIE. The Company also reviews all of its cost-method investments in each reporting period to determine whether a significant event of change in circumstances has occurred that may have an adverse effect on the fair value of each investment. |
Derivative_and_Hedgiing_Activi
Derivative and Hedgiing Activities Derivative and Hedging Activities | 3 Months Ended | ||||||||||||||||||||||
Apr. 03, 2015 | |||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure | DERIVATIVES AND HEDGING ACTIVITIES | ||||||||||||||||||||||
The Company uses forward contracts to manage exposures to foreign currency exchange rates. The Company's primary objective in holding derivative instruments is to reduce the volatility of earnings and cash flows associated with fluctuations in foreign currency exchange rates and the Company does not use derivative instruments for trading purposes. The use of derivative instruments expose the Company to credit risk to the extent that the counterparties may be unable to meet their contractual obligations, as such, the potential risk of loss with any one counterparty is closely monitored by the Company. | |||||||||||||||||||||||
Derivatives Designated as Hedging Instruments (Cash Flow Hedges) | |||||||||||||||||||||||
Beginning in December 2014, the Company entered into forward currency contracts to hedge forecasted operating expenses and service costs related to employee salaries and benefits denominated in Israeli shekels (“ILS”) for its subsidiaries in Israel. These ILS forward contacts mature generally within twelve months and are designated as cash flow hedges. For derivatives that are designated as hedges of forecasted foreign currency denominated operating expenses and service costs, the Company assesses effectiveness based on changes in spot currency exchange rates. Changes in spot rates on the derivative are recorded as a component of “Accumulated other comprehensive income (loss)” (“OCI”) in the Condensed Consolidated Balance Sheet until such time as the hedged transaction impacts earnings. The change in fair value of the forward points, which reflects the interest rate differential between the two countries on the derivative, is excluded from the effectiveness assessment. Gains or losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. | |||||||||||||||||||||||
Derivatives Not Designated as Hedging Instruments (Balance Sheet Hedges) | |||||||||||||||||||||||
Balance sheet hedges consist of foreign currency forward contracts, mature generally within three months, are carried at fair value and they are used to minimize the short-term impact of foreign currency exchange rate fluctuation on cash and certain trade and inter-company receivables and payables. Changes in the fair value of these foreign currency forward contracts are recognized in “Other income (expense), net” in the Condensed Consolidated Statement of Operations and are largely offset by the changes in the fair value of the assets or liabilities being hedged. | |||||||||||||||||||||||
The locations and amounts of designated and non-designated derivative instruments' gains and losses reported in the Company's Condensed Consolidated Statements of Operations were as follows (in thousands): | |||||||||||||||||||||||
Three months ended | |||||||||||||||||||||||
Financial Statement Location | 3-Apr-15 | 28-Mar-14 | |||||||||||||||||||||
Derivatives Designated as Hedging instruments: | |||||||||||||||||||||||
Gains in accumulated OCI on derivatives (effective portion) | Accumulated OCI | $ | 184 | $ | — | ||||||||||||||||||
Gains reclassified from accumulated OCI into income (effective portion) | Cost of Revenue | $ | 7 | $ | — | ||||||||||||||||||
Operating Expense | 42 | — | |||||||||||||||||||||
Total | $ | 49 | $ | — | |||||||||||||||||||
Loss recognized in income on derivatives (ineffectiveness portion and amount excluded from effectiveness testing) | Other income (expense), net | $ | (42 | ) | $ | — | |||||||||||||||||
Derivatives Not Designated as Hedging instruments: | |||||||||||||||||||||||
Gains (losses) recognized in income | Other income (expense), net | $ | 252 | $ | (177 | ) | |||||||||||||||||
The Company anticipates the accumulated OCI balance of 78,000 at April 3, 2015, relating to net unrealized gains from cash flow hedges, will be reclassified to earnings in 2015. | |||||||||||||||||||||||
The U.S. dollar equivalents of all outstanding notional amounts of foreign currency forward contracts are summarized as follows (in thousands): | |||||||||||||||||||||||
3-Apr-15 | 31-Dec-14 | ||||||||||||||||||||||
Derivatives designated as cash flow hedges: | |||||||||||||||||||||||
Purchase | $ | 12,728 | $ | 16,903 | |||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||
Purchase | $ | 6,585 | $ | 1,043 | |||||||||||||||||||
Sell | $ | 9,069 | $ | 4,925 | |||||||||||||||||||
The locations and fair value amounts of the Company's derivative instruments reported in its Condensed Consolidated Balance Sheets are as follows (in thousands): | |||||||||||||||||||||||
Asset Derivatives | Derivative Liabilities | ||||||||||||||||||||||
Balance Sheet Location | April 3, 2015 | December 31, 2014 | Balance Sheet Location | April 3, 2015 | December 31, 2014 | ||||||||||||||||||
Derivatives designated as hedging instruments: | |||||||||||||||||||||||
Foreign currency contracts | Prepaid expenses and other current assets | $ | 57 | $ | 329 | Accrued Liabilities | $ | — | $ | — | |||||||||||||
$ | 57 | $ | 329 | $ | — | $ | — | ||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||
Foreign currency contracts | Prepaid expenses and other current assets | $ | 91 | $ | 12 | Accrued Liabilities | $ | 18 | $ | 7 | |||||||||||||
$ | 91 | $ | 12 | $ | 18 | $ | 7 | ||||||||||||||||
Total derivatives | $ | 148 | $ | 341 | $ | 18 | $ | 7 | |||||||||||||||
Offsetting of Derivative Assets and Liabilities | |||||||||||||||||||||||
The Company recognizes all derivative instruments on a gross basis in the Condensed Consolidated Balance Sheet. However, the arrangements with its counterparties allows for net settlement, which are designed to reduce credit risk by permitting net settlement with the same counterparty. To further limit credit risk, the Company also enters into cash collateral security arrangements with the same counterparty. As of April 3, 2015, information related to the offsetting arrangements was as follows (in thousands): | |||||||||||||||||||||||
Gross Amounts of Derivatives Not Offset in the Condensed Consolidated Balance Sheets | |||||||||||||||||||||||
Gross Amounts of Derivatives | Gross Amounts of Derivatives Offset in the Condensed Consolidated Balance sheets | Net Amounts of Derivatives Presented in the Condensed Consolidated Balance Sheets | Financial Instrument | Cash Collateral Pledged | Net Amount | ||||||||||||||||||
Derivative Assets | $ | 148 | — | $ | 148 | $ | (18 | ) | — | $ | 130 | ||||||||||||
Derivative Liabilities | $ | 18 | — | $ | 18 | $ | (18 | ) | — | $ | — | ||||||||||||
As of December 31, 2014, there was no potential effect of rights of offset associated with the outstanding foreign currency forward contracts that would result in a net derivative asset or net derivative liability. |
Fair_Value_Measurements
Fair Value Measurements | 3 Months Ended | |||||||||||||||
Apr. 03, 2015 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Fair Value Measurements | FAIR VALUE MEASUREMENTS | |||||||||||||||
The applicable accounting guidance establishes a framework for measuring fair value and requires disclosure about the fair value measurements of assets and liabilities. This guidance requires the Company to classify and disclose assets and liabilities measured at fair value on a recurring basis, as well as fair value measurements of assets and liabilities measured on a nonrecurring basis in periods subsequent to initial measurement, in a three-tier fair value hierarchy as described below. | ||||||||||||||||
The guidance defines fair value as the exchange price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants on the measurement date. | ||||||||||||||||
Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The guidance describes three levels of inputs that may be used to measure fair value: | ||||||||||||||||
• | Level 1 — Observable inputs that reflect quoted prices for identical assets or liabilities in active markets. | |||||||||||||||
• | Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. The Company primarily uses broker quotes for valuation of its short-term investments. The forward exchange contracts are classified as Level 2 because they are valued using quoted market prices and other observable data for similar instruments in an active market. | |||||||||||||||
• | Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | |||||||||||||||
The Company uses the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. During the three months ended April 3, 2015, there were no nonrecurring fair value measurements of assets and liabilities subsequent to initial recognition. | ||||||||||||||||
The following table sets forth the fair value of the Company’s financial assets and liabilities measured at fair value based on the three-tier fair value hierarchy (in thousands): | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
As of April 3, 2015 | ||||||||||||||||
Cash equivalents | ||||||||||||||||
Money market funds | $ | 32,795 | $ | — | $ | — | $ | 32,795 | ||||||||
Short-term investments | ||||||||||||||||
State, municipal and local government agencies bonds | — | 11,238 | — | 11,238 | ||||||||||||
Corporate bonds | — | 10,965 | — | 10,965 | ||||||||||||
Prepaids and other current assets | ||||||||||||||||
Derivative assets | — | 148 | — | 148 | ||||||||||||
Other assets | ||||||||||||||||
Long-term investment | 3,082 | — | — | 3,082 | ||||||||||||
Total assets measured and recorded at fair value | $ | 35,877 | $ | 22,351 | $ | — | $ | 58,228 | ||||||||
Accrued liabilities | ||||||||||||||||
Derivative liabilities | $ | — | $ | 18 | $ | — | $ | 18 | ||||||||
Total liabilities measured and recorded at fair value | $ | — | $ | 18 | $ | — | $ | 18 | ||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
As of December 31, 2014 | ||||||||||||||||
Cash equivalents | ||||||||||||||||
Money market funds | $ | 23,121 | $ | — | $ | — | $ | 23,121 | ||||||||
Short-term investments | ||||||||||||||||
State, municipal and local government agencies bonds | — | 13,961 | — | 13,961 | ||||||||||||
Corporate bonds | — | 17,886 | — | 17,886 | ||||||||||||
Prepaids and other current assets | ||||||||||||||||
Derivative assets | — | 341 | — | 341 | ||||||||||||
Other assets | ||||||||||||||||
Long-term investment | 2,606 | — | — | 2,606 | ||||||||||||
Total assets measured and recorded at fair value | $ | 25,727 | $ | 32,188 | $ | — | $ | 57,915 | ||||||||
Accrued liabilities | ||||||||||||||||
Derivative liabilities | $ | — | $ | 7 | $ | — | $ | 7 | ||||||||
Total liabilities measured and recorded at fair value | $ | — | $ | 7 | $ | — | $ | 7 | ||||||||
Balance_Sheet_Components
Balance Sheet Components | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||
Balance Sheet Components | BALANCE SHEET COMPONENTS | |||||||
The following tables provide details of selected balance sheet components (in thousands): | ||||||||
3-Apr-15 | 31-Dec-14 | |||||||
Accounts receivable, net: | ||||||||
Accounts receivable | $ | 80,974 | $ | 81,201 | ||||
Less: allowances for doubtful accounts, returns and discounts | (5,110 | ) | (7,057 | ) | ||||
Total | $ | 75,864 | $ | 74,144 | ||||
Prepaid expenses and other current assets: | ||||||||
Prepaid inventories to contract manufacturer(1) | $ | 14,200 | $ | — | ||||
Prepaid software license to Vislink(2) | 1,090 | 1,233 | ||||||
Other Prepayments | 9,953 | 9,713 | ||||||
Deferred cost of revenue | 3,364 | 2,524 | ||||||
Income tax receivable | 1,664 | 2,316 | ||||||
Other | 255 | 1,753 | ||||||
$ | 30,526 | $ | 17,539 | |||||
(1) In the first quarter of 2015, the Company made a $14.2 million advance payment for future inventory requirements to a supplier in order to secure more favorable pricing. The Company anticipates that this amount will begin to offset in the fourth quarter of 2015 through the first quarter of 2016 against the accounts payable owed to this supplier. | ||||||||
(2) The prepaid inventories were related to prepayment for software licenses made to Vislink (see Note 4, “Investments in Other Equity Securities,” for additional information on Vislink). | ||||||||
Inventories: | ||||||||
Raw materials | $ | 1,844 | $ | 1,422 | ||||
Work-in-process | 1,439 | 1,255 | ||||||
Finished goods | 28,235 | 30,070 | ||||||
Total | $ | 31,518 | $ | 32,747 | ||||
Property and equipment, net: | ||||||||
Furniture and fixtures | $ | 7,690 | $ | 7,691 | ||||
Machinery and equipment | 116,895 | 116,031 | ||||||
Leasehold improvements | 9,550 | 8,140 | ||||||
Property and equipment, gross | 134,135 | 131,862 | ||||||
Less: accumulated depreciation and amortization | (106,995 | ) | (104,641 | ) | ||||
Total | $ | 27,140 | $ | 27,221 | ||||
Goodwill_and_Identified_Intang
Goodwill and Identified Intangible Assets | 3 Months Ended | |||||||||||||||||||||||||
Apr. 03, 2015 | ||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||
Goodwill and Identified Intangible Assets | GOODWILL AND IDENTIFIED INTANGIBLE ASSETS | |||||||||||||||||||||||||
Goodwill | ||||||||||||||||||||||||||
The following table presents goodwill by reportable segments (in thousands): | ||||||||||||||||||||||||||
Video | Cable Edge | Total | ||||||||||||||||||||||||
As of December 31, 2014 | $ | 136,975 | $ | 60,909 | $ | 197,884 | ||||||||||||||||||||
Foreign currency translation adjustment | (75 | ) | (33 | ) | (108 | ) | ||||||||||||||||||||
As of April 3, 2015 | $ | 136,900 | $ | 60,876 | $ | 197,776 | ||||||||||||||||||||
Identified Intangible Assets | ||||||||||||||||||||||||||
The following is a summary of identifiable intangible assets (in thousands): | ||||||||||||||||||||||||||
3-Apr-15 | 31-Dec-14 | |||||||||||||||||||||||||
Range of Useful Lives | Gross Carrying | Accumulated | Net Carrying | Gross Carrying | Accumulated | Net Carrying | ||||||||||||||||||||
Amount | Amortization | Amount | Amount | Amortization | Amount | |||||||||||||||||||||
Identifiable intangibles: | ||||||||||||||||||||||||||
Developed core technology | 4-6 years | $ | 136,145 | $ | (135,887 | ) | $ | 258 | $ | 136,145 | $ | (135,426 | ) | $ | 719 | |||||||||||
Customer relationships/contracts | 5-6 years | 67,098 | (60,001 | ) | 7,097 | 67,098 | (58,784 | ) | 8,314 | |||||||||||||||||
Maintenance agreements and related relationships | 6-7 years | 7,100 | (5,763 | ) | 1,337 | 7,100 | (5,534 | ) | 1,566 | |||||||||||||||||
Total identifiable intangibles | $ | 210,343 | $ | (201,651 | ) | $ | 8,692 | $ | 210,343 | $ | (199,744 | ) | $ | 10,599 | ||||||||||||
Amortization expense for the identifiable purchased intangible assets for the three months ended April 3, 2015 and March 28, 2014 was allocated as follows (in thousands): | ||||||||||||||||||||||||||
Three months ended | ||||||||||||||||||||||||||
April 3, | March 28, | |||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||
Included in cost of revenue | $ | 461 | $ | 4,716 | ||||||||||||||||||||||
Included in operating expenses | 1,446 | 1,950 | ||||||||||||||||||||||||
Total amortization expense | $ | 1,907 | $ | 6,666 | ||||||||||||||||||||||
The estimated future amortization expense of purchased intangible assets with definite lives is as follows (in thousands): | ||||||||||||||||||||||||||
Cost of Revenue | Operating | Total | ||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||
Year ended December 31, | ||||||||||||||||||||||||||
2015 (remaining 9 months) | $ | 258 | $ | 4,337 | $ | 4,595 | ||||||||||||||||||||
2016 | — | 4,097 | 4,097 | |||||||||||||||||||||||
Total future amortization expense | $ | 258 | $ | 8,434 | $ | 8,692 | ||||||||||||||||||||
Restructuring_and_Related_Char
Restructuring and Related Charges | 3 Months Ended | |||||||||||
Apr. 03, 2015 | ||||||||||||
Restructuring and Related Activities [Abstract] | ||||||||||||
Restructuring and Related Charges | RESTRUCTURING AND RELATED CHARGES | |||||||||||
The Company implemented several restructuring plans in the past few years. The goal of these plans was to bring operational expenses to appropriate levels relative to its net revenues, while simultaneously implementing extensive company-wide expense control programs. | ||||||||||||
The Company accounts for its restructuring plans under the authoritative guidance for exit or disposal activities. The restructuring and asset impairment charges are included in “Product cost of revenue” and “Operating expenses-restructuring and related charges” in the Condensed Consolidated Statements of Operations. The following table summarizes the restructuring and related charges (in thousands): | ||||||||||||
Three months ended | ||||||||||||
April 3, | March 28, | |||||||||||
2015 | 2014 | |||||||||||
Restructuring and related charges in: | ||||||||||||
Product cost of revenue | $ | — | $ | 79 | ||||||||
Operating expenses-Restructuring and related charges | 44 | 149 | ||||||||||
$ | 44 | $ | 228 | |||||||||
Harmonic 2015 Restructuring | ||||||||||||
In the fourth quarter of 2014, the Company approved a new restructuring plan (the “Harmonic 2015 Restructuring Plan”) to reduce 2015 operating costs and the planned restructuring activities involve headcount reduction, exiting certain operating facilities and disposing of excess assets. The Company started the restructuring activities pursuant to this plan in the fourth quarter of 2014 and expects to complete its actions by end of 2015. The Company recorded $2.2 million of restructuring and asset impairment charges recorded under this plan in the fourth quarter of 2014 consisting of a $1.1 million fixed asset impairment charge related to software development costs incurred for a discontinued information technology (“IT”) project, $0.6 million of severance and benefits related to the termination of nineteen employees worldwide, $0.3 million of excess material costs associated with the termination of a research and development project and $0.1 million of other charges. In the three months ended April 3, 2015, the Company recorded an additional 44,000 restructuring charges under the Harmonic 2015 Restructuring Plan primarily related to severance and benefits for two employees. | ||||||||||||
The following table summarizes the activity in the Harmonic 2015 restructuring accrual during the three months ended April 3, 2015 (in thousands): | ||||||||||||
Severance and benefits | Other charges | Total | ||||||||||
Balance at December 31, 2014 | $ | 305 | $ | 17 | $ | 322 | ||||||
Restructuring charges | 56 | — | 56 | |||||||||
Adjustments to restructuring provisions | (5 | ) | (7 | ) | (12 | ) | ||||||
Cash payments | (312 | ) | (9 | ) | (321 | ) | ||||||
Non-cash write-offs | — | 2 | 2 | |||||||||
Balance at April 3, 2015 | $ | 44 | $ | 3 | $ | 47 | ||||||
Harmonic 2013 Restructuring | ||||||||||||
The Company implemented a series of restructuring plans in 2013 to reduce costs and improve efficiencies. These restructuring plans extended to actions taken through the third quarter of fiscal 2014. As a result, the Company recorded restructuring charges of $2.2 million and $0.9 million in fiscal 2013 and fiscal 2014, respectively. The restructuring charges in the three months ended March 28, 2014 were $0.2 million under these plans, consisting of severance and benefits related to the termination of eight employees worldwide and costs associated with vacating from excess facility in France. For a complete discussion of the restructuring actions related to the 2013 restructuring plans, see Note 11, "Restructuring and Asset Impairment Charges," of Notes to Consolidated Financial Statements in the 2014 Form 10-K. |
Credit_Facilities
Credit Facilities | 3 Months Ended |
Apr. 03, 2015 | |
Debt Disclosure [Abstract] | |
Credit Facilities | CREDIT FACILITIES |
On December 22, 2014, the Company entered into a Credit Agreement with JPMorgan Chase Bank, N.A. (“JPMorgan”) for a $20.0 million revolving credit facility, with a sublimit of $10.0 million for the issuance of commercial and standby letters of credit on the Company’s behalf. Revolving loans under the Credit Agreement may be borrowed, repaid and re-borrowed until December 22, 2015, at which time all amounts borrowed must be repaid. There were no borrowings under the Credit Agreement during the three months ended April 3, 2015. As of April 3, 2015, the amount available for borrowing under this facility, net of $0.2 million of standby letters of credit, was $19.8 million. | |
The revolving loan bears interest, at the Company's election, at either (a) an adjusted LIBOR rate for a term of one, two or three months, plus an applicable margin of 1.75% or (b) the prime rate plus an applicable margin of -1.30%, provided that such rate shall not be less than the one month adjusted LIBOR rate, plus 2.5%. In the event that the balance of the Company’s accounts held with JPMorgan falls below $30.0 million in aggregate total worldwide consolidated cash and short-term investments (the “Consolidated Cash Threshold”) for five consecutive business days, the Company is obligated to pay a one-time facility fee of $50,000 to JPMorgan. The Company is also obligated to pay JPMorgan a non-usage fee equal to the average daily unused portion of the credit facility multiplied by a per annum rate of 0.25% if, during any calendar month, the balance in the Company’s accounts held with JPMorgan falls below the Consolidated Cash Threshold for five consecutive business days. | |
The Company will pay a letter of credit fee with respect to any letters of credit issued under the Credit Agreement in an amount equal to (a) in the case of a standby letter of credit, the maximum amount available to be drawn under such standby letter of credit multiplied by a per annum rate of 1.75% and (b) in the case of a commercial letter of credit, the greater of $100 or 0.75% of the original maximum available amount of such commercial letter of credit. The Company will also pay other customary transaction fees and costs in connection with the issuance of letters of credit under the Credit Agreement. | |
Obligations under the Credit Agreement are secured only by a pledge of 66 2/3% of the Company’s equity interests in its foreign subsidiary, Harmonic International AG. Additionally, to the extent that the Company in the future forms any direct or indirect, domestic, material subsidiaries, those subsidiaries will be required to provide a guaranty of the Company’s obligations under the Credit Agreement. | |
The Credit Agreement contains customary affirmative and negative covenants, including covenants that limit the Company’s and its subsidiaries’ ability to, among other things, incur indebtedness, grant liens, merge or consolidate, dispose of assets, make investments or pay dividends, in each case subject to certain exceptions. The Company is also required to maintain, on a consolidated basis, total cash and marketable securities of at least $35.0 million and EBITDA of at least $20.0 million determined on a rolling four-quarter basis. As of April 3, 2015, the Company was in compliance with the covenants under the Credit Agreement. |
Employee_Benefit_Plans
Employee Benefit Plans | 3 Months Ended | ||||||||||||||||
Apr. 03, 2015 | |||||||||||||||||
Postemployment Benefits [Abstract] | |||||||||||||||||
Employee Benefit Plans | EMPLOYEE BENEFIT PLANS | ||||||||||||||||
Harmonic grants stock options and restricted stock units (“RSUs”) pursuant to stockholder approved equity incentive plans. These equity incentive plans are described in detail in Note 14, “Employee Benefit Plans”, of Notes to Consolidated Financial Statements in the 2014 Form 10-K. | |||||||||||||||||
Stock Options and Restricted Stock Units | |||||||||||||||||
The following table summarizes the Company’s stock option and RSU unit activity during the three months ended April 3, 2015 (in thousands, except per share amounts): | |||||||||||||||||
Stock Options Outstanding | Restricted Stock Units Outstanding | ||||||||||||||||
Shares | Number | Weighted | Number | Weighted | |||||||||||||
Available for | of | Average | of | Average | |||||||||||||
Grant | Shares | Exercise Price | Units | Grant | |||||||||||||
Date Fair | |||||||||||||||||
Value | |||||||||||||||||
Balance at December 31, 2014 | 7,480 | 7,255 | $ | 6.65 | 2,241 | $ | 6.4 | ||||||||||
Authorized | — | — | — | — | |||||||||||||
Granted | (3,037 | ) | 1,049 | 7.58 | 1,325 | 7.57 | |||||||||||
Options exercised | — | (617 | ) | 5.49 | — | — | |||||||||||
Shares released | — | — | — | (925 | ) | 6.56 | |||||||||||
Forfeited or cancelled | 283 | (172 | ) | 6.86 | (73 | ) | 6.23 | ||||||||||
Balance at April 3, 2015 | 4,726 | 7,515 | $ | 6.87 | 2,568 | $ | 7.01 | ||||||||||
The following table summarizes information about stock options outstanding as of April 3, 2015 (in thousands, except per share amounts): | |||||||||||||||||
Number | Weighted | Weighted | Aggregate | ||||||||||||||
of | Average | Average | Intrinsic | ||||||||||||||
Shares | Exercise | Remaining | Value | ||||||||||||||
Price | Contractual | ||||||||||||||||
Term (Years) | |||||||||||||||||
Vested and expected to vest | 7,126 | $ | 6.87 | 3.7 | $ | 6,331 | |||||||||||
Exercisable | 4,694 | 6.94 | 2.5 | 4,571 | |||||||||||||
The intrinsic value of options vested and expected to vest and exercisable as of April 3, 2015 is calculated based on the difference between the exercise price and the fair value of the Company’s common stock as of April 3, 2015. The intrinsic value of options exercised is calculated based on the difference between the exercise price and the fair value of the Company's common stock as of the exercise date. The intrinsic value of options exercised during the three months ended April 3, 2015 and March 28, 2014 was $1.3 million and $0.1 million, respectively. | |||||||||||||||||
The following table summarizes information about RSUs outstanding as of April 3, 2015 (in thousands, except per share amounts): | |||||||||||||||||
Number of | Weighted | Aggregate | |||||||||||||||
Shares | Average | Fair | |||||||||||||||
Underlying | Remaining | Value | |||||||||||||||
Restricted | Vesting | ||||||||||||||||
Stock | Period | ||||||||||||||||
Units | (Years) | ||||||||||||||||
Vested and expected to vest | 2,359 | 0.8 | $ | 17,407 | |||||||||||||
The fair value of RSUs vested and expected to vest as of April 3, 2015 is calculated based on the fair value of the Company's common stock as of April 3, 2015. | |||||||||||||||||
Employee Stock Purchase Plan | |||||||||||||||||
The 2002 Employee Stock Purchase Plan (“ESPP”) provides for the issuance of common stock purchase rights to employees of the Company. The ESPP is intended to qualify as an “employee stock purchase plan” under Section 423 of the Internal Revenue Code. The ESPP enables employees to purchase shares at 85% of the fair market value of the common stock at the beginning or end of the offering period, whichever is lower. Offering periods generally begin on the first trading day on or after January 1 and July 1 of each year. Employees may participate through payroll deductions of 1% to 10% of their earnings. In the event that there are insufficient shares in the plan to fully fund the issuance, the available shares will be allocated across all participants based on their contributions relative to the total contributions received for the offering period. | |||||||||||||||||
401(k) Plan | |||||||||||||||||
The Company has a retirement/savings plan which qualifies as a thrift plan under Section 401(k) of the Internal Revenue Code. This plan allows participants to contribute up to the applicable Internal Revenue Code limitations under the plan. The Company has made discretionary contributions to the plan of 25% of the first 4% contributed by eligible participants, up to a maximum contribution per participant of $1,000 per year. The contributions for the three months ended April 3, 2015 and March 28, 2014 were $161,000 and $173,000, respectively. |
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||
Stock-Based Compensation | STOCK-BASED COMPENSATION | |||||||
Stock-based compensation expense consists primarily of expenses for stock options and RSUs granted to employees and shares issued under the ESPP. The following table summarizes stock-based compensation expense (in thousands): | ||||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Stock-based compensation in: | ||||||||
Cost of revenue | $ | 528 | $ | 516 | ||||
Research and development expense | 1,148 | 1,101 | ||||||
Selling, general and administrative expense | 2,458 | 2,190 | ||||||
Total stock-based compensation in operating expense | 3,606 | 3,291 | ||||||
Total stock-based compensation | $ | 4,134 | $ | 3,807 | ||||
The Company is required to estimate forfeitures at the time of grant and revise those estimates in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate pre-vesting option forfeitures and records stock-based compensation expense only for those awards that are expected to vest. All stock-based payment awards are amortized on a straight-line basis over the requisite service periods of the awards, which are generally the vesting periods. | ||||||||
Stock Options | ||||||||
The Company estimated the fair value of all employee stock options using a Black-Scholes valuation model with the following weighted average assumptions: | ||||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Expected term (years) | 4.7 | 4.7 | ||||||
Volatility | 38 | % | 40 | % | ||||
Risk-free interest rate | 1.6 | % | 1.7 | % | ||||
Expected dividends | 0 | % | 0 | % | ||||
The expected term represents the weighted-average period that the stock options are expected to remain outstanding. The computation of the expected term was determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior. The Company uses its historical volatility for a period equivalent to the expected term of the options to estimate the expected volatility. The risk-free interest rate that the Company uses in the Black-Scholes option valuation model is based on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term. The Company has never declared or paid any cash dividends and does not plan to pay cash dividends in the foreseeable future, and, therefore, used an expected dividend yield of zero in the valuation model. | ||||||||
The weighted-average fair value per share of options granted was $2.63 and $2.35 for the three months ended April 3, 2015 and March 28, 2014, respectively. The fair value of all stock options vested during the three months ended April 3, 2015 and March 28, 2014 were both $1.3 million. The total realized tax benefit attributable to stock options exercised during the three months ended April 3, 2015 and March 28, 2014, in jurisdictions where this expense is deductible for tax purposes, were $120,000 and $185,000, respectively. | ||||||||
Restricted Stock Units | ||||||||
The aggregate fair value of all RSUs issued during the three months ended April 3, 2015 and March 28, 2014 were $6.1 million and $5.4 million, respectively. | ||||||||
Employee Stock Purchase Plan | ||||||||
The value of the stock purchase rights under the ESPP consists of: (1) the 15% discount on the purchase of the stock; (2) 85% of the fair value of the call option; and (3) 15% of the fair value of the put option. The call option and put option were valued using the Black-Scholes option pricing model. The weighted average fair value of the Company's ESPP shares at purchase dates was estimated using the following weighted average assumptions during the three months ended April 3, 2015 and March 28, 2014: | ||||||||
Purchase Period Ending | ||||||||
June 30, | June 30, | |||||||
2015 | 2014 | |||||||
Expected term (years) | 0.49 | 0.5 | ||||||
Volatility | 35 | % | 29 | % | ||||
Risk-free interest rate | 0.1 | % | 0.1 | % | ||||
Expected dividends | 0 | % | 0 | % | ||||
Estimated weighted average fair value per share at purchase date | $1.74 | $1.71 | ||||||
The expected term represents the period of time from the beginning of the offering period to the purchase date. The Company uses its historical volatility for a period equivalent to the expected term of the options to estimate the expected volatility. The risk-free interest rate that the Company uses in the Black-Scholes option valuation model is based on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term. The Company has never declared or paid any cash dividends and does not plan to pay cash dividends in the foreseeable future, and, therefore, used an expected dividend yield of zero in the valuation model. | ||||||||
Unrecognized Stock-Based Compensation | ||||||||
As of April 3, 2015, the Company had approximately $20.1 million of unrecognized stock-based compensation expense related to the unvested portion of its stock options and RSUs that is expected to be recognized over a weighted-average period of approximately 2.1 years. |
Income_Taxes
Income Taxes | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Income Tax Disclosure [Abstract] | ||||||||
Income Taxes | INCOME TAXES | |||||||
The Company reported the following operating results for the periods presented (in thousands): | ||||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Loss before income taxes | $ | (2,943 | ) | $ | (7,133 | ) | ||
Benefit from income taxes | (286 | ) | (1,723 | ) | ||||
Effective income tax rate | 9.7 | % | 24.2 | % | ||||
The Company's quarterly income taxes reflect an estimate of the corresponding fiscal year's annual effective tax rate and include, where applicable, adjustments for discrete tax items. | ||||||||
In the three months ended April 3, 2015, the Company's effective income tax rate was 9.7%. The rate for the three months ended April 3, 2015 is lower than the U.S. federal statutory rate of 35% primarily because the loss before income taxes for three months ended April 3, 2015 included the loss on impairment of VJU investment (see Note 4, "Investments in Other Equity Securities") for which no tax benefit can be recognized. The effective tax rate for the three months ended April 3, 2015 excluding the loss on impairment of VJU would be approximately 65% and this is higher than the U.S. federal rate of 35% primarily due to an increase in the Company's U.S. current and non-current income tax payable as well as maintaining a full valuation allowance against all of the Company's U.S. deferred tax assets. | ||||||||
In the three months ended March 28, 2014, the Company's effective rate was 24.2%, lower than the U.S. federal statutory rate of 35%, primarily due to favorable tax rates associated with certain earnings from operations in lower-tax jurisdictions, partially offset by the detriment from non-deductible stock-based compensation and non-deductible amortization of foreign intangibles, and various net discrete tax adjustments. For three months ended March 28, 2014, the discrete adjustments to the Company's tax benefit were primarily the accrual of interest on uncertain tax positions. | ||||||||
The Company files U.S. federal and state, and foreign income tax returns in jurisdictions with varying statutes of limitations during which such tax returns may be audited and adjusted by the relevant tax authorities. The 2011 through 2014 tax years generally remain subject to examination by U.S. federal and most state tax authorities. In significant foreign jurisdictions, the 2006 through 2014 tax years generally remain subject to examination by their respective tax authorities. In the first quarter of 2015, the Israeli tax authority commenced an audit of a subsidiary of the Company for the 2012 and 2013 tax years. If, upon the conclusion of this audit, the ultimate determination of taxes owed in Israel is for an amount in excess of the tax provision the Company has recorded in the applicable period, the Company's overall tax expense, effective tax rate, operating results and cash flow could be materially and adversely impacted in the period of adjustment. | ||||||||
The Company's operations in Switzerland are subject to a reduced tax rate under the Switzerland tax holiday which requires various thresholds of investment and employment in Switzerland. The Company has met these various thresholds and the Switzerland tax holiday is effective through the end of 2018. | ||||||||
As of April 3, 2015, the total amount of gross unrecognized tax benefits, including interest and penalties, was approximately $16.3 million, that if recognized, would affect the Company's effective tax rate. The Company recognizes interest and penalties related to unrecognized tax positions in income tax expense. The Company had $0.6 million of gross interest and penalties accrued as of April 3, 2015. The Company will continue to review its tax positions and provide for, or reverse, unrecognized tax benefits as issues arise. As of April 3, 2015, the Company anticipates that the balance of gross unrecognized tax benefits will decrease up to approximately $1.0 million due to expiration of the applicable statues of limitations over the next twelve months. |
Income_Loss_Per_Share
Income (Loss) Per Share | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Earnings Per Share [Abstract] | ||||||||
Income (Loss) Per Share | INCOME (LOSS) PER SHARE | |||||||
The following table sets forth the computation of the basic and diluted net loss per share (in thousands, except per share amounts): | ||||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Numerator: | ||||||||
Net loss | $ | (2,657 | ) | $ | (5,410 | ) | ||
Denominator: | ||||||||
Weighted average number of common shares outstanding | ||||||||
Basic and diluted | 88,655 | 97,921 | ||||||
Net loss per share: | ||||||||
Basic and diluted | $ | (0.03 | ) | $ | (0.06 | ) | ||
The following table sets forth the potentially dilutive shares from stock options, RSUs and the ESPP, for the periods presented, that were excluded from the net loss per share computations because their effect was anti-dilutive (in thousands): | ||||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Potentially dilutive equity awards outstanding | 9,641 | 11,072 | ||||||
Segment_Information
Segment Information | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Segment Reporting [Abstract] | ||||||||
Segment Information | SEGMENT INFORMATION | |||||||
Operating segments are defined as components of an enterprise that engage in business activities for which separate financial information is available and evaluated by the Company's Chief Operating Decision Maker ( “CODM”), which for Harmonic is its Chief Executive Officer, in deciding how to allocate resources and assess performance. Prior to the fourth quarter of 2014, the Company operated its business in one reportable segment. In connection with the 2015 annual planning process, the Company changed its operating segments to align with how the CODM expected to evaluate the financial information used to allocate resources and assess performance of the Company. The new reporting structure consists of two operating segments: Video and Cable Edge. As a result, the segment information presented has been conformed to the new operating segments for all prior periods. | ||||||||
The new operating segments were determined based on the nature of the products offered. The Video segment sells video processing and production and playout solutions and services worldwide to broadcast and media companies, streaming new media companies, cable operators, and satellite and telecommunications (telco) Pay-TV service providers. The Cable Edge segment sells cable edge solutions and related services to cable operators globally. | ||||||||
The Company does not allocate amortization of intangibles, stock-based compensation, restructuring and asset impairment charges, and certain other non-recurring charges to the operating income for each segment because management does not include this information in the measurement of the performance of the operating segments. A measure of assets by segment is not applicable as segment assets are not included in the discrete financial information provided to the CODM. | ||||||||
The following tables provide summary financial information by reportable segment (in thousands): | ||||||||
Three months ended | ||||||||
April 3, 2015 | March 28, 2014 | |||||||
Net revenue: | ||||||||
Video | $ | 69,282 | $ | 81,152 | ||||
Cable Edge | 34,734 | 26,880 | ||||||
Total consolidated net revenue | $ | 104,016 | $ | 108,032 | ||||
Operating income (loss): | ||||||||
Video | $ | (90 | ) | $ | 2,435 | |||
Cable Edge | 6,188 | 1,044 | ||||||
Total segment operating income | 6,098 | 3,479 | ||||||
Unallocated corporate expenses* | (44 | ) | (228 | ) | ||||
Stock-based compensation | (4,134 | ) | (3,807 | ) | ||||
Amortization of intangibles | (1,907 | ) | (6,666 | ) | ||||
Income (loss) from operations | 13 | (7,222 | ) | |||||
Non-operating income (expense) | (2,956 | ) | 89 | |||||
Loss before income taxes | $ | (2,943 | ) | $ | (7,133 | ) | ||
*Unallocated corporate expenses include certain corporate-level operating expenses and charges such as restructuring and related charges. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ||||||||
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES | |||||||
Leases | ||||||||
Future minimum lease payments under non-cancelable operating leases as of April 3, 2015, after giving effect to $131,000 of future sublease income, are as follows (in thousands): | ||||||||
Years ending December 31, | ||||||||
2015 (remaining 9 months) | $ | 7,591 | ||||||
2016 | 8,788 | |||||||
2017 | 8,067 | |||||||
2018 | 7,933 | |||||||
2019 | 7,885 | |||||||
Thereafter | 6,133 | |||||||
Total | $ | 46,397 | ||||||
Warranties | ||||||||
The Company accrues for estimated warranty costs at the time of product shipment. Management periodically reviews the estimated fair value of its warranty liability and records adjustments based on the terms of warranties provided to customers, historical and anticipated warranty claims experience, and estimates of the timing and cost of warranty claims. Activity for the Company’s warranty accrual, which is included in accrued liabilities, is summarized below (in thousands): | ||||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Balance at beginning of period | $ | 4,242 | $ | 3,606 | ||||
Accrual for current period warranties | 1,595 | 1,749 | ||||||
Warranty costs incurred | (1,746 | ) | (1,696 | ) | ||||
Balance at end of period | $ | 4,091 | $ | 3,659 | ||||
Purchase Commitments with Contract Manufacturers and Other Suppliers | ||||||||
The Company relies on a limited number of contract manufacturers and suppliers to provide manufacturing services for a substantial majority of its products. In addition, some components, sub-assemblies and modules are obtained from a sole supplier or limited group of suppliers. During the normal course of business, in order to reduce manufacturing lead times and ensure adequate component supply, the Company enters into agreements with certain contract manufacturers and suppliers that allow them to procure inventory and services based upon criteria defined by the Company. The Company had approximately $22.6 million of non-cancelable purchase commitments with contract manufacturers and other suppliers as of April 3, 2015. | ||||||||
Standby Letters of Credit | ||||||||
As of April 3, 2015, the Company’s financial guarantees consisted of standby letters of credit outstanding, which were principally related to performance bonds and state requirements imposed on employers. The maximum amount of potential future payments under these arrangements was $0.4 million as of April 3, 2015. | ||||||||
Indemnification | ||||||||
Harmonic is obligated to indemnify its officers and the members of its Board of Directors pursuant to its bylaws and contractual indemnity agreements. Harmonic also indemnifies some of its suppliers and most of its customers for specified intellectual property matters pursuant to certain contractual arrangements, subject to certain limitations. The scope of these indemnities varies, but, in some instances, includes indemnification for damages and expenses (including reasonable attorneys’ fees). There have been no amounts accrued in respect of these indemnification provisions through April 3, 2015. | ||||||||
Guarantees | ||||||||
The Company has $0.4 million of guarantees in Israel as of April 3, 2015, with the majority relating to rent obligations for buildings used by its Israeli subsidiaries. | ||||||||
Legal proceedings | ||||||||
From time to time, the Company is involved in lawsuits as well as subject to various legal proceedings, claims, threats of litigation, and investigations in the ordinary course of business, including claims of alleged infringement of third-party patents and other intellectual property rights, commercial, employment, and other matters. The Company assesses potential liabilities in connection with each lawsuit and threatened lawsuits and accrues an estimated loss for these loss contingencies if both of the following conditions are met: information available prior to issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of loss can be reasonably estimated. While certain matters to which the Company is a party specify the damages claimed, such claims may not represent reasonably possible losses. Given the inherent uncertainties of litigation, the ultimate outcome of these matters cannot be predicted at this time, nor can the amount of possible loss or range of loss, if any, be reasonably estimated. | ||||||||
In October 2011, Avid Technology, Inc. (“Avid”) filed a complaint in the United States District Court for the District of Delaware alleging that the Company’s Media Grid product infringes two patents held by Avid. A jury trial on this complaint commenced on January 23, 2014 and, on February 4, 2014, the jury returned a unanimous verdict in favor of the Company, rejecting Avid's infringement allegations in their entirety. On May 23, 2014, Avid filed a post-trial motion asking the court to set aside the jury’s verdict, and the judge issued an order on December 17, 2014, denying the motion. On January 5, 2015, Avid filed an appeal with respect to the jury’s verdict with the Federal Circuit, which was docketed on January 9, 2015, as Case No. 2015-1246. Avid filed its opening brief with respect to this appeal on March 24, 2015, and the Company filed its response brief on May 7, 2015. | ||||||||
In June 2012, Avid served a subsequent complaint in the United States District Court for the District of Delaware alleging that the Company’s Spectrum product infringes one patent held by Avid. The complaint seeks injunctive relief and unspecified damages. In September 2013, the U.S. Patent Trial and Appeal Board (“PTAB”) authorized an inter partes review to be instituted as to claims 1-16 of the patent asserted in this second complaint. A hearing before the PTAB was conducted on May 20, 2014. On July 10, 2014, the PTAB issued a decision finding claims 1 - 10 invalid and claims 11 - 16 not invalid. The Company filed an appeal with respect to the PTAB’s decision on claims 11 - 16 on September 11, 2014. The appeal was docketed with the Federal Circuit on October 22, 2014, as Case No. 2015-1072, and the Company filed its opening brief with respect to this appeal on January 29, 2015. Avid and PTAB each filed a response brief on April 27, 2015. | ||||||||
An unfavorable outcome on any litigation matter could require that the Company pay substantial damages, or, in connection with any intellectual property infringement claims, could require that the Company pay ongoing royalty payments or could prevent the Company from selling certain of its products. As a result, a settlement of, or an unfavorable outcome on, any of the matters referenced above or other litigation matters could have a material adverse effect on the Company’s business, operating results, financial position and cash flows. |
Stockholders_Equity
Stockholders' Equity | 3 Months Ended | |||||||||||||||
Apr. 03, 2015 | ||||||||||||||||
Equity [Abstract] | ||||||||||||||||
Stockholders' Equity | STOCKHOLDERS’ EQUITY | |||||||||||||||
Accumulated Other Comprehensive Loss (“AOCI”) | ||||||||||||||||
The components of accumulated other comprehensive loss, on an after-tax basis where applicable, were as follows (in thousands): | ||||||||||||||||
Foreign Currency Translation Adjustments | Unrealized Gains (Losses) on Cash Flow Hedges | Unrealized Gains (Losses) on Available-for-Sale Investments | Total | |||||||||||||
Balance as of December 31, 2014 | $ | (1,523 | ) | $ | 311 | $ | (768 | ) | $ | (1,980 | ) | |||||
Other comprehensive income (loss) before reclassifications | (984 | ) | (184 | ) | 485 | $ | (683 | ) | ||||||||
Amounts reclassified from AOCI | — | (49 | ) | — | (49 | ) | ||||||||||
Provision for income taxes | — | — | (4 | ) | (4 | ) | ||||||||||
Balance as of April 3, 2015 | $ | (2,507 | ) | $ | 78 | (287 | ) | (2,716 | ) | |||||||
The effects of amounts reclassified from AOCI into the condensed consolidated statement of operations were as follows (in thousands): | ||||||||||||||||
Three months ended | ||||||||||||||||
3-Apr-15 | 28-Mar-14 | |||||||||||||||
Gains on cash flow hedges from foreign currency contracts: | ||||||||||||||||
Cost of revenue | $ | 7 | $ | — | ||||||||||||
Operating expenses | 42 | — | ||||||||||||||
Total reclassifications from AOCI | $ | 49 | $ | — | ||||||||||||
Common Stock Repurchases | ||||||||||||||||
On April 24, 2012, the Company's Board of Directors (the “Board”) approved a stock repurchase program that provided for the repurchase of up to $25 million of our outstanding common stock. During 2013, the Board approved $195 million of increases to the program, increasing the aggregate authorized amount of the program to $220 million. On February 6, 2013, the Board approved a modification to the program that permits the Company to also repurchase its common stock pursuant to a plan that meets the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. On May 14, 2014, the Board approved an additional $80 million increase to the program, resulting in an aggregate authorized purchase of $300 million under the program and the repurchase period was extended through the end of 2016. | ||||||||||||||||
As of April 3, 2015, the Company had purchased 37.9 million shares of common stock under this program at a weighted average price of $6.23 per share for an aggregate purchase price of $237.5 million, including $1.0 million of expenses. The remaining authorized amount for stock repurchases under this program was $63.5 million as of April 3, 2015. For additional information, see “Item 2 - Unregistered sales of equity securities and use of proceeds” of this Quarterly Report on Form 10-Q. |
Basis_of_Presentation_and_Sign1
Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended | |||||
Apr. 03, 2015 | ||||||
Accounting Policies [Abstract] | ||||||
Use of Estimates | Use of Estimates | |||||
The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | ||||||
Significant Accounting Policies | The Company’s significant accounting policies are described in Note 2 to its audited Consolidated Financial Statements included in its 2014 Form 10-K. There have been no significant changes to these policies during the three months ended April 3, 2015. | |||||
Recent Accounting Pronouncements | RECENT ACCOUNTING PRONOUNCEMENTS | |||||
On May 28, 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers”, requiring an entity to recognize the amount of revenue that reflects the consideration to which it expects to be entitled for the transfer of promised goods or services to customers. The updated standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. Early adoption is not permitted. The updated standard becomes effective for the Company in the first quarter of fiscal 2017. In April 2015, the FASB announced a proposal to defer the effective date by one year, with early adoption on the original effective date permitted. The Company has not yet selected a transition method and it is currently evaluating the effect that the updated standard will have on its consolidated financial statements and related disclosures. | ||||||
On November 3, 2014, the FASB issued ASU No. 2014-16, “Derivatives and Hedging (Topic 815) - Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share is More Akin to Debt or to Equity”. ASU 2014-16 was issued to clarify how current U.S. GAAP should be interpreted in evaluating the economic characteristics and risk of a host contract in a hybrid financial instrument that is issued in the form of a share. In addition, ASU 2014-16 was issued to clarify that in evaluating the nature of a host contract, an entity should assess the substance of the relevant terms and features (that is, the relative strength of the debt-like or equity-like terms and features given the facts and circumstances) when considering how to weight those terms and features. ASU 2014-16 is effective in the fiscal year beginning after December 15, 2015. Early adoption in an interim period is permitted. The Company is currently evaluating the impact of the adoption of ASU 2014-16 on its consolidated financial statements. | ||||||
On February 18, 2015, the FASB issued ASU No. 2015-02, “Consolidation (Topic 810) - Amendments to the Consolidation Analysis”, intended to improve targeted areas of consolidation guidance for all entities. ASU 2015-02 is effective in the fiscal year beginning after December 15, 2015. Early adoption in an interim period is permitted. The Company is currently evaluating the impact of the adoption of ASU 2015-02 on its consolidated financial statements. | ||||||
On April 15, 2015, the FASB issued ASU No. 2015-05, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) - Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement”. ASU 2015-05 amends ASC 350-40 to provide customers with guidance on whether a cloud computing arrangement contains a software license to be accounted for as internal-use software. ASU No. 2015-05 is effective in the fiscal year beginning after December 15, 2015. Early adoption in an interim period is permitted. The Company is currently evaluating the impact of the adoption of ASU 2015-05 on its consolidated financial statements. | ||||||
Impairment of Investments | Impairment of Short-term Investments | |||||
The Company monitors its investment portfolio for impairment on a periodic basis. In the event that the carrying value of an investment exceeds its fair value and the decline in value is determined to be other-than-temporary, an impairment charge is recorded and a new cost basis for the investment is established. A decline of fair value below amortized costs of debt securities is considered other-than-temporary if the Company has the intent to sell the security or it is more likely than not that the Company will be required to sell the security before recovery of the entire amortized cost basis. At the present time, the Company does not intend to sell its investments that have unrealized losses in accumulated other comprehensive loss. In addition, the Company does not believe that it is more likely than not that it will be required to sell its investments that have unrealized losses in accumulated other comprehensive loss before the Company recovers the principal amounts invested. The Company believes that the unrealized losses are temporary and do not require an other-than-temporary impairment, based on its evaluation of available evidence as of April 3, 2015. | ||||||
As of April 3, 2015, there were no individual available-for-sale securities in a material unrealized loss position and the amount of unrealized losses on the total investment balance was insignificant. | ||||||
Investments in Other Equity Securities | Each reporting period, the Company reviews all of its unconsolidated VIE investments to determine whether there are any reconsideration events that may result in the Company being a primary beneficiary of the unconsolidated VIE which would then require the Company to consolidate the VIE. The Company also reviews all of its cost-method investments in each reporting period to determine whether a significant event of change in circumstances has occurred that may have an adverse effect on the fair value of each investment. | |||||
Derivatives and Hedging Activities | Offsetting of Derivative Assets and Liabilities | |||||
The Company recognizes all derivative instruments on a gross basis in the Condensed Consolidated Balance Sheet. However, the arrangements with its counterparties allows for net settlement, which are designed to reduce credit risk by permitting net settlement with the same counterparty. To further limit credit risk, the Company also enters into cash collateral security arrangements with the same counterparty. | ||||||
The Company uses forward contracts to manage exposures to foreign currency exchange rates. The Company's primary objective in holding derivative instruments is to reduce the volatility of earnings and cash flows associated with fluctuations in foreign currency exchange rates and the Company does not use derivative instruments for trading purposes. The use of derivative instruments expose the Company to credit risk to the extent that the counterparties may be unable to meet their contractual obligations, as such, the potential risk of loss with any one counterparty is closely monitored by the Company. | ||||||
Derivatives Designated as Hedging Instruments (Cash Flow Hedges) | ||||||
Beginning in December 2014, the Company entered into forward currency contracts to hedge forecasted operating expenses and service costs related to employee salaries and benefits denominated in Israeli shekels (“ILS”) for its subsidiaries in Israel. These ILS forward contacts mature generally within twelve months and are designated as cash flow hedges. For derivatives that are designated as hedges of forecasted foreign currency denominated operating expenses and service costs, the Company assesses effectiveness based on changes in spot currency exchange rates. Changes in spot rates on the derivative are recorded as a component of “Accumulated other comprehensive income (loss)” (“OCI”) in the Condensed Consolidated Balance Sheet until such time as the hedged transaction impacts earnings. The change in fair value of the forward points, which reflects the interest rate differential between the two countries on the derivative, is excluded from the effectiveness assessment. Gains or losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. | ||||||
Derivatives Not Designated as Hedging Instruments (Balance Sheet Hedges) | ||||||
Balance sheet hedges consist of foreign currency forward contracts, mature generally within three months, are carried at fair value and they are used to minimize the short-term impact of foreign currency exchange rate fluctuation on cash and certain trade and inter-company receivables and payables. Changes in the fair value of these foreign currency forward contracts are recognized in “Other income (expense), net” in the Condensed Consolidated Statement of Operations and are largely offset by the changes in the fair value of the assets or liabilities being hedged. | ||||||
Fair Value of Financial Instruments | The applicable accounting guidance establishes a framework for measuring fair value and requires disclosure about the fair value measurements of assets and liabilities. This guidance requires the Company to classify and disclose assets and liabilities measured at fair value on a recurring basis, as well as fair value measurements of assets and liabilities measured on a nonrecurring basis in periods subsequent to initial measurement, in a three-tier fair value hierarchy as described below. | |||||
The guidance defines fair value as the exchange price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants on the measurement date. | ||||||
Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The guidance describes three levels of inputs that may be used to measure fair value: | ||||||
• | Level 1 — Observable inputs that reflect quoted prices for identical assets or liabilities in active markets. | |||||
• | Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. The Company primarily uses broker quotes for valuation of its short-term investments. The forward exchange contracts are classified as Level 2 because they are valued using quoted market prices and other observable data for similar instruments in an active market. | |||||
• | Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | |||||
The Company uses the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. During the three months ended April 3, 2015, there were no nonrecurring fair value measurements of assets and liabilities subsequent to initial recognition. | ||||||
Share-based Compensation Expense | Stock Options | |||||
The Company estimated the fair value of all employee stock options using a Black-Scholes valuation model with the following weighted average assumptions: | ||||||
Three months ended | ||||||
April 3, | March 28, | |||||
2015 | 2014 | |||||
Expected term (years) | 4.7 | 4.7 | ||||
Volatility | 38 | % | 40 | % | ||
Risk-free interest rate | 1.6 | % | 1.7 | % | ||
Expected dividends | 0 | % | 0 | % | ||
The expected term represents the weighted-average period that the stock options are expected to remain outstanding. The computation of the expected term was determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior. The Company uses its historical volatility for a period equivalent to the expected term of the options to estimate the expected volatility. The risk-free interest rate that the Company uses in the Black-Scholes option valuation model is based on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term. The Company has never declared or paid any cash dividends and does not plan to pay cash dividends in the foreseeable future, and, therefore, used an expected dividend yield of zero in the valuation model. | ||||||
The weighted-average fair value per share of options granted was $2.63 and $2.35 for the three months ended April 3, 2015 and March 28, 2014, respectively. The fair value of all stock options vested during the three months ended April 3, 2015 and March 28, 2014 were both $1.3 million. The total realized tax benefit attributable to stock options exercised during the three months ended April 3, 2015 and March 28, 2014, in jurisdictions where this expense is deductible for tax purposes, were $120,000 and $185,000, respectively. | ||||||
Restricted Stock Units | ||||||
The aggregate fair value of all RSUs issued during the three months ended April 3, 2015 and March 28, 2014 were $6.1 million and $5.4 million, respectively. | ||||||
Employee Stock Purchase Plan | ||||||
The value of the stock purchase rights under the ESPP consists of: (1) the 15% discount on the purchase of the stock; (2) 85% of the fair value of the call option; and (3) 15% of the fair value of the put option. The call option and put option were valued using the Black-Scholes option pricing model. The weighted average fair value of the Company's ESPP shares at purchase dates was estimated using the following weighted average assumptions during the three months ended April 3, 2015 and March 28, 2014: | ||||||
Purchase Period Ending | ||||||
June 30, | June 30, | |||||
2015 | 2014 | |||||
Expected term (years) | 0.49 | 0.5 | ||||
Volatility | 35 | % | 29 | % | ||
Risk-free interest rate | 0.1 | % | 0.1 | % | ||
Expected dividends | 0 | % | 0 | % | ||
Estimated weighted average fair value per share at purchase date | $1.74 | $1.71 | ||||
The expected term represents the period of time from the beginning of the offering period to the purchase date. The Company uses its historical volatility for a period equivalent to the expected term of the options to estimate the expected volatility. The risk-free interest rate that the Company uses in the Black-Scholes option valuation model is based on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term. The Company has never declared or paid any cash dividends and does not plan to pay cash dividends in the foreseeable future, and, therefore, used an expected dividend yield of zero in the valuation model. | ||||||
Unrecognized Stock-Based Compensation | ||||||
As of April 3, 2015, the Company had approximately $20.1 million of unrecognized stock-based compensation expense related to the unvested portion of its stock options and RSUs that is expected to be recognized over a weighted-average period of approximately 2.1 years. | ||||||
Income Tax | As of April 3, 2015, the total amount of gross unrecognized tax benefits, including interest and penalties, was approximately $16.3 million, that if recognized, would affect the Company's effective tax rate. The Company recognizes interest and penalties related to unrecognized tax positions in income tax expense. The Company had $0.6 million of gross interest and penalties accrued as of April 3, 2015. The Company will continue to review its tax positions and provide for, or reverse, unrecognized tax benefits as issues arise. As of April 3, 2015, the Company anticipates that the balance of gross unrecognized tax benefits will decrease up to approximately $1.0 million due to expiration of the applicable statues of limitations over the next twelve months. | |||||
Warranties and Indemnification | The Company accrues for estimated warranty costs at the time of product shipment. Management periodically reviews the estimated fair value of its warranty liability and records adjustments based on the terms of warranties provided to customers, historical and anticipated warranty claims experience, and estimates of the timing and cost of warranty claims. | |||||
Harmonic is obligated to indemnify its officers and the members of its Board of Directors pursuant to its bylaws and contractual indemnity agreements. Harmonic also indemnifies some of its suppliers and most of its customers for specified intellectual property matters pursuant to certain contractual arrangements, subject to certain limitations. The scope of these indemnities varies, but, in some instances, includes indemnification for damages and expenses (including reasonable attorneys’ fees). | ||||||
Segment Information | Operating segments are defined as components of an enterprise that engage in business activities for which separate financial information is available and evaluated by the Company's Chief Operating Decision Maker ( “CODM”), which for Harmonic is its Chief Executive Officer, in deciding how to allocate resources and assess performance. Prior to the fourth quarter of 2014, the Company operated its business in one reportable segment. In connection with the 2015 annual planning process, the Company changed its operating segments to align with how the CODM expected to evaluate the financial information used to allocate resources and assess performance of the Company. The new reporting structure consists of two operating segments: Video and Cable Edge. As a result, the segment information presented has been conformed to the new operating segments for all prior periods. | |||||
The new operating segments were determined based on the nature of the products offered. The Video segment sells video processing and production and playout solutions and services worldwide to broadcast and media companies, streaming new media companies, cable operators, and satellite and telecommunications (telco) Pay-TV service providers. The Cable Edge segment sells cable edge solutions and related services to cable operators globally. | ||||||
The Company does not allocate amortization of intangibles, stock-based compensation, restructuring and asset impairment charges, and certain other non-recurring charges to the operating income for each segment because management does not include this information in the measurement of the performance of the operating segments. A measure of assets by segment is not applicable as segment assets are not included in the discrete financial information provided to the CODM. |
ShortTerm_Investments_Tables
Short-Term Investments (Tables) | 3 Months Ended | |||||||||||||||
Apr. 03, 2015 | ||||||||||||||||
Cash and Cash Equivalents [Abstract] | ||||||||||||||||
Summary of Short-Term Investments | The following table summarizes the Company’s short-term investments (in thousands): | |||||||||||||||
Amortized | Gross | Gross | Estimated | |||||||||||||
Cost | Unrealized | Unrealized | Fair Value | |||||||||||||
Gains | Losses | |||||||||||||||
As of April 3, 2015 | ||||||||||||||||
State, municipal and local government agencies bonds | $ | 11,228 | $ | 10 | $ | — | $ | 11,238 | ||||||||
Corporate bonds | 10,969 | 1 | (5 | ) | 10,965 | |||||||||||
Total short-term investments | $ | 22,197 | $ | 11 | $ | (5 | ) | $ | 22,203 | |||||||
As of December 31, 2014 | ||||||||||||||||
State, municipal and local government agencies bonds | $ | 13,946 | $ | 16 | $ | (1 | ) | $ | 13,961 | |||||||
Corporate bonds | 17,899 | 3 | (16 | ) | 17,886 | |||||||||||
Total short-term investments | $ | 31,845 | $ | 19 | $ | (17 | ) | $ | 31,847 | |||||||
Maturities of Short-Term Investments | The following table summarizes the maturities of the Company’s short-term investments (in thousands): | |||||||||||||||
3-Apr-15 | 31-Dec-14 | |||||||||||||||
Less than one year | $ | 22,203 | $ | 30,946 | ||||||||||||
Due in 1 - 2 years | — | 901 | ||||||||||||||
Total short-term investments | $ | 22,203 | $ | 31,847 | ||||||||||||
Investments_in_Other_Equity_Se1
Investments in Other Equity Securities Schedule of Cost Method Investments (Tables) | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Investments, All Other Investments [Abstract] | ||||||||
Cost Method Investments | The following table presents the carrying values and maximum exposure of the unconsolidated VIEs as of April 3, 2015 (in thousands): | |||||||
Carrying Value | Maximum exposure to loss(1) | |||||||
VJU | — | — | ||||||
EDC(2) | 3,593 | 3,593 | ||||||
Total | $ | 3,593 | $ | 3,593 | ||||
Derivative_and_Hedging_Activit
Derivative and Hedging Activities (Tables) | 3 Months Ended | ||||||||||||||||||||||
Apr. 03, 2015 | |||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||
Schedule of Derivative Instruments gain and losses by Statement of Operations locations | The locations and amounts of designated and non-designated derivative instruments' gains and losses reported in the Company's Condensed Consolidated Statements of Operations were as follows (in thousands): | ||||||||||||||||||||||
Three months ended | |||||||||||||||||||||||
Financial Statement Location | 3-Apr-15 | 28-Mar-14 | |||||||||||||||||||||
Derivatives Designated as Hedging instruments: | |||||||||||||||||||||||
Gains in accumulated OCI on derivatives (effective portion) | Accumulated OCI | $ | 184 | $ | — | ||||||||||||||||||
Gains reclassified from accumulated OCI into income (effective portion) | Cost of Revenue | $ | 7 | $ | — | ||||||||||||||||||
Operating Expense | 42 | — | |||||||||||||||||||||
Total | $ | 49 | $ | — | |||||||||||||||||||
Loss recognized in income on derivatives (ineffectiveness portion and amount excluded from effectiveness testing) | Other income (expense), net | $ | (42 | ) | $ | — | |||||||||||||||||
Derivatives Not Designated as Hedging instruments: | |||||||||||||||||||||||
Gains (losses) recognized in income | Other income (expense), net | $ | 252 | $ | (177 | ) | |||||||||||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions | The U.S. dollar equivalents of all outstanding notional amounts of foreign currency forward contracts are summarized as follows (in thousands): | ||||||||||||||||||||||
3-Apr-15 | 31-Dec-14 | ||||||||||||||||||||||
Derivatives designated as cash flow hedges: | |||||||||||||||||||||||
Purchase | $ | 12,728 | $ | 16,903 | |||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||
Purchase | $ | 6,585 | $ | 1,043 | |||||||||||||||||||
Sell | $ | 9,069 | $ | 4,925 | |||||||||||||||||||
Schedule of Derivatives Instruments Balance Sheet Location | The locations and fair value amounts of the Company's derivative instruments reported in its Condensed Consolidated Balance Sheets are as follows (in thousands): | ||||||||||||||||||||||
Asset Derivatives | Derivative Liabilities | ||||||||||||||||||||||
Balance Sheet Location | April 3, 2015 | December 31, 2014 | Balance Sheet Location | April 3, 2015 | December 31, 2014 | ||||||||||||||||||
Derivatives designated as hedging instruments: | |||||||||||||||||||||||
Foreign currency contracts | Prepaid expenses and other current assets | $ | 57 | $ | 329 | Accrued Liabilities | $ | — | $ | — | |||||||||||||
$ | 57 | $ | 329 | $ | — | $ | — | ||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||
Foreign currency contracts | Prepaid expenses and other current assets | $ | 91 | $ | 12 | Accrued Liabilities | $ | 18 | $ | 7 | |||||||||||||
$ | 91 | $ | 12 | $ | 18 | $ | 7 | ||||||||||||||||
Total derivatives | $ | 148 | $ | 341 | $ | 18 | $ | 7 | |||||||||||||||
Changes in fair values of non-designated foreign currency forward contracts | As of April 3, 2015, information related to the offsetting arrangements was as follows (in thousands): | ||||||||||||||||||||||
Gross Amounts of Derivatives Not Offset in the Condensed Consolidated Balance Sheets | |||||||||||||||||||||||
Gross Amounts of Derivatives | Gross Amounts of Derivatives Offset in the Condensed Consolidated Balance sheets | Net Amounts of Derivatives Presented in the Condensed Consolidated Balance Sheets | Financial Instrument | Cash Collateral Pledged | Net Amount | ||||||||||||||||||
Derivative Assets | $ | 148 | — | $ | 148 | $ | (18 | ) | — | $ | 130 | ||||||||||||
Derivative Liabilities | $ | 18 | — | $ | 18 | $ | (18 | ) | — | $ | — | ||||||||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 3 Months Ended | |||||||||||||||
Apr. 03, 2015 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Financial Assets and Liabilities Measured at Fair Value Based on Three-Tier Fair Value Hierarchy | The following table sets forth the fair value of the Company’s financial assets and liabilities measured at fair value based on the three-tier fair value hierarchy (in thousands): | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
As of April 3, 2015 | ||||||||||||||||
Cash equivalents | ||||||||||||||||
Money market funds | $ | 32,795 | $ | — | $ | — | $ | 32,795 | ||||||||
Short-term investments | ||||||||||||||||
State, municipal and local government agencies bonds | — | 11,238 | — | 11,238 | ||||||||||||
Corporate bonds | — | 10,965 | — | 10,965 | ||||||||||||
Prepaids and other current assets | ||||||||||||||||
Derivative assets | — | 148 | — | 148 | ||||||||||||
Other assets | ||||||||||||||||
Long-term investment | 3,082 | — | — | 3,082 | ||||||||||||
Total assets measured and recorded at fair value | $ | 35,877 | $ | 22,351 | $ | — | $ | 58,228 | ||||||||
Accrued liabilities | ||||||||||||||||
Derivative liabilities | $ | — | $ | 18 | $ | — | $ | 18 | ||||||||
Total liabilities measured and recorded at fair value | $ | — | $ | 18 | $ | — | $ | 18 | ||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
As of December 31, 2014 | ||||||||||||||||
Cash equivalents | ||||||||||||||||
Money market funds | $ | 23,121 | $ | — | $ | — | $ | 23,121 | ||||||||
Short-term investments | ||||||||||||||||
State, municipal and local government agencies bonds | — | 13,961 | — | 13,961 | ||||||||||||
Corporate bonds | — | 17,886 | — | 17,886 | ||||||||||||
Prepaids and other current assets | ||||||||||||||||
Derivative assets | — | 341 | — | 341 | ||||||||||||
Other assets | ||||||||||||||||
Long-term investment | 2,606 | — | — | 2,606 | ||||||||||||
Total assets measured and recorded at fair value | $ | 25,727 | $ | 32,188 | $ | — | $ | 57,915 | ||||||||
Accrued liabilities | ||||||||||||||||
Derivative liabilities | $ | — | $ | 7 | $ | — | $ | 7 | ||||||||
Total liabilities measured and recorded at fair value | $ | — | $ | 7 | $ | — | $ | 7 | ||||||||
Balance_Sheet_Components_Table
Balance Sheet Components (Tables) | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||
Accounts Receivable, Net | ||||||||
3-Apr-15 | 31-Dec-14 | |||||||
Accounts receivable, net: | ||||||||
Accounts receivable | $ | 80,974 | $ | 81,201 | ||||
Less: allowances for doubtful accounts, returns and discounts | (5,110 | ) | (7,057 | ) | ||||
Total | $ | 75,864 | $ | 74,144 | ||||
Prepaid, and Other Current Assets | ||||||||
Prepaid expenses and other current assets: | ||||||||
Prepaid inventories to contract manufacturer(1) | $ | 14,200 | $ | — | ||||
Prepaid software license to Vislink(2) | 1,090 | 1,233 | ||||||
Other Prepayments | 9,953 | 9,713 | ||||||
Deferred cost of revenue | 3,364 | 2,524 | ||||||
Income tax receivable | 1,664 | 2,316 | ||||||
Other | 255 | 1,753 | ||||||
$ | 30,526 | $ | 17,539 | |||||
Inventories | ||||||||
Inventories: | ||||||||
Raw materials | $ | 1,844 | $ | 1,422 | ||||
Work-in-process | 1,439 | 1,255 | ||||||
Finished goods | 28,235 | 30,070 | ||||||
Total | $ | 31,518 | $ | 32,747 | ||||
Property and Equipment, Net | ||||||||
Property and equipment, net: | ||||||||
Furniture and fixtures | $ | 7,690 | $ | 7,691 | ||||
Machinery and equipment | 116,895 | 116,031 | ||||||
Leasehold improvements | 9,550 | 8,140 | ||||||
Property and equipment, gross | 134,135 | 131,862 | ||||||
Less: accumulated depreciation and amortization | (106,995 | ) | (104,641 | ) | ||||
Total | $ | 27,140 | $ | 27,221 | ||||
Goodwill_and_Identified_Intang1
Goodwill and Identified Intangible Assets (Tables) | 3 Months Ended | |||||||||||||||||||||||||
Apr. 03, 2015 | ||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||
Changes in Carrying Amount of Goodwill | The following table presents goodwill by reportable segments (in thousands): | |||||||||||||||||||||||||
Video | Cable Edge | Total | ||||||||||||||||||||||||
As of December 31, 2014 | $ | 136,975 | $ | 60,909 | $ | 197,884 | ||||||||||||||||||||
Foreign currency translation adjustment | (75 | ) | (33 | ) | (108 | ) | ||||||||||||||||||||
As of April 3, 2015 | $ | 136,900 | $ | 60,876 | $ | 197,776 | ||||||||||||||||||||
Summary of Goodwill and Identified Intangible Assets | The following is a summary of identifiable intangible assets (in thousands): | |||||||||||||||||||||||||
3-Apr-15 | 31-Dec-14 | |||||||||||||||||||||||||
Range of Useful Lives | Gross Carrying | Accumulated | Net Carrying | Gross Carrying | Accumulated | Net Carrying | ||||||||||||||||||||
Amount | Amortization | Amount | Amount | Amortization | Amount | |||||||||||||||||||||
Identifiable intangibles: | ||||||||||||||||||||||||||
Developed core technology | 4-6 years | $ | 136,145 | $ | (135,887 | ) | $ | 258 | $ | 136,145 | $ | (135,426 | ) | $ | 719 | |||||||||||
Customer relationships/contracts | 5-6 years | 67,098 | (60,001 | ) | 7,097 | 67,098 | (58,784 | ) | 8,314 | |||||||||||||||||
Maintenance agreements and related relationships | 6-7 years | 7,100 | (5,763 | ) | 1,337 | 7,100 | (5,534 | ) | 1,566 | |||||||||||||||||
Total identifiable intangibles | $ | 210,343 | $ | (201,651 | ) | $ | 8,692 | $ | 210,343 | $ | (199,744 | ) | $ | 10,599 | ||||||||||||
Amortization Expense for Identifiable Purchased Intangible Assets | Amortization expense for the identifiable purchased intangible assets for the three months ended April 3, 2015 and March 28, 2014 was allocated as follows (in thousands): | |||||||||||||||||||||||||
Three months ended | ||||||||||||||||||||||||||
April 3, | March 28, | |||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||||
Included in cost of revenue | $ | 461 | $ | 4,716 | ||||||||||||||||||||||
Included in operating expenses | 1,446 | 1,950 | ||||||||||||||||||||||||
Total amortization expense | $ | 1,907 | $ | 6,666 | ||||||||||||||||||||||
Estimated Future Amortization Expense of Purchased Intangible Assets | The estimated future amortization expense of purchased intangible assets with definite lives is as follows (in thousands): | |||||||||||||||||||||||||
Cost of Revenue | Operating | Total | ||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||
Year ended December 31, | ||||||||||||||||||||||||||
2015 (remaining 9 months) | $ | 258 | $ | 4,337 | $ | 4,595 | ||||||||||||||||||||
2016 | — | 4,097 | 4,097 | |||||||||||||||||||||||
Total future amortization expense | $ | 258 | $ | 8,434 | $ | 8,692 | ||||||||||||||||||||
Restructuring_and_Related_Char1
Restructuring and Related Charges (Tables) | 3 Months Ended | |||||||||||
Apr. 03, 2015 | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Summary of restructuring activities | The following table summarizes the restructuring and related charges (in thousands): | |||||||||||
Three months ended | ||||||||||||
April 3, | March 28, | |||||||||||
2015 | 2014 | |||||||||||
Restructuring and related charges in: | ||||||||||||
Product cost of revenue | $ | — | $ | 79 | ||||||||
Operating expenses-Restructuring and related charges | 44 | 149 | ||||||||||
$ | 44 | $ | 228 | |||||||||
Harmonic Two Thousand And Fifteen Restructuring [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Schedule of Restructuring Reserve by Type of Cost | The following table summarizes the activity in the Harmonic 2015 restructuring accrual during the three months ended April 3, 2015 (in thousands): | |||||||||||
Severance and benefits | Other charges | Total | ||||||||||
Balance at December 31, 2014 | $ | 305 | $ | 17 | $ | 322 | ||||||
Restructuring charges | 56 | — | 56 | |||||||||
Adjustments to restructuring provisions | (5 | ) | (7 | ) | (12 | ) | ||||||
Cash payments | (312 | ) | (9 | ) | (321 | ) | ||||||
Non-cash write-offs | — | 2 | 2 | |||||||||
Balance at April 3, 2015 | $ | 44 | $ | 3 | $ | 47 | ||||||
Employee_Benefit_Plans_Tables
Employee Benefit Plans (Tables) | 3 Months Ended | ||||||||||||||||
Apr. 03, 2015 | |||||||||||||||||
Postemployment Benefits [Abstract] | |||||||||||||||||
Summary of Company's Stock Option and Restricted Stock Unit Activity | The following table summarizes the Company’s stock option and RSU unit activity during the three months ended April 3, 2015 (in thousands, except per share amounts): | ||||||||||||||||
Stock Options Outstanding | Restricted Stock Units Outstanding | ||||||||||||||||
Shares | Number | Weighted | Number | Weighted | |||||||||||||
Available for | of | Average | of | Average | |||||||||||||
Grant | Shares | Exercise Price | Units | Grant | |||||||||||||
Date Fair | |||||||||||||||||
Value | |||||||||||||||||
Balance at December 31, 2014 | 7,480 | 7,255 | $ | 6.65 | 2,241 | $ | 6.4 | ||||||||||
Authorized | — | — | — | — | |||||||||||||
Granted | (3,037 | ) | 1,049 | 7.58 | 1,325 | 7.57 | |||||||||||
Options exercised | — | (617 | ) | 5.49 | — | — | |||||||||||
Shares released | — | — | — | (925 | ) | 6.56 | |||||||||||
Forfeited or cancelled | 283 | (172 | ) | 6.86 | (73 | ) | 6.23 | ||||||||||
Balance at April 3, 2015 | 4,726 | 7,515 | $ | 6.87 | 2,568 | $ | 7.01 | ||||||||||
Summary of Stock Options Outstanding | The following table summarizes information about stock options outstanding as of April 3, 2015 (in thousands, except per share amounts): | ||||||||||||||||
Number | Weighted | Weighted | Aggregate | ||||||||||||||
of | Average | Average | Intrinsic | ||||||||||||||
Shares | Exercise | Remaining | Value | ||||||||||||||
Price | Contractual | ||||||||||||||||
Term (Years) | |||||||||||||||||
Vested and expected to vest | 7,126 | $ | 6.87 | 3.7 | $ | 6,331 | |||||||||||
Exercisable | 4,694 | 6.94 | 2.5 | 4,571 | |||||||||||||
Summary of Restricted Stock Units Outstanding | The following table summarizes information about RSUs outstanding as of April 3, 2015 (in thousands, except per share amounts): | ||||||||||||||||
Number of | Weighted | Aggregate | |||||||||||||||
Shares | Average | Fair | |||||||||||||||
Underlying | Remaining | Value | |||||||||||||||
Restricted | Vesting | ||||||||||||||||
Stock | Period | ||||||||||||||||
Units | (Years) | ||||||||||||||||
Vested and expected to vest | 2,359 | 0.8 | $ | 17,407 | |||||||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||
Summary of Stock-Based Compensation Expense | The following table summarizes stock-based compensation expense (in thousands): | |||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Stock-based compensation in: | ||||||||
Cost of revenue | $ | 528 | $ | 516 | ||||
Research and development expense | 1,148 | 1,101 | ||||||
Selling, general and administrative expense | 2,458 | 2,190 | ||||||
Total stock-based compensation in operating expense | 3,606 | 3,291 | ||||||
Total stock-based compensation | $ | 4,134 | $ | 3,807 | ||||
Valuation Assumptions for Stock Options | The Company estimated the fair value of all employee stock options using a Black-Scholes valuation model with the following weighted average assumptions: | |||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Expected term (years) | 4.7 | 4.7 | ||||||
Volatility | 38 | % | 40 | % | ||||
Risk-free interest rate | 1.6 | % | 1.7 | % | ||||
Expected dividends | 0 | % | 0 | % | ||||
Employee Stock Purchase Plan | The call option and put option were valued using the Black-Scholes option pricing model. The weighted average fair value of the Company's ESPP shares at purchase dates was estimated using the following weighted average assumptions during the three months ended April 3, 2015 and March 28, 2014: | |||||||
Purchase Period Ending | ||||||||
June 30, | June 30, | |||||||
2015 | 2014 | |||||||
Expected term (years) | 0.49 | 0.5 | ||||||
Volatility | 35 | % | 29 | % | ||||
Risk-free interest rate | 0.1 | % | 0.1 | % | ||||
Expected dividends | 0 | % | 0 | % | ||||
Estimated weighted average fair value per share at purchase date | $1.74 | $1.71 |
Income_Taxes_Tables
Income Taxes (Tables) | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Income Tax Disclosure [Abstract] | ||||||||
Schedule of income before income tax | The Company reported the following operating results for the periods presented (in thousands): | |||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Loss before income taxes | $ | (2,943 | ) | $ | (7,133 | ) | ||
Benefit from income taxes | (286 | ) | (1,723 | ) | ||||
Effective income tax rate | 9.7 | % | 24.2 | % | ||||
Income_Loss_Per_Share_Tables
Income (Loss) Per Share (Tables) | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Earnings Per Share [Abstract] | ||||||||
Numerators and Denominators of Basic and Diluted Net Income (Loss) Per Share Computations | The following table sets forth the computation of the basic and diluted net loss per share (in thousands, except per share amounts): | |||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Numerator: | ||||||||
Net loss | $ | (2,657 | ) | $ | (5,410 | ) | ||
Denominator: | ||||||||
Weighted average number of common shares outstanding | ||||||||
Basic and diluted | 88,655 | 97,921 | ||||||
Net loss per share: | ||||||||
Basic and diluted | $ | (0.03 | ) | $ | (0.06 | ) | ||
Anti-dilutive Securities | The following table sets forth the potentially dilutive shares from stock options, RSUs and the ESPP, for the periods presented, that were excluded from the net loss per share computations because their effect was anti-dilutive (in thousands): | |||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Potentially dilutive equity awards outstanding | 9,641 | 11,072 | ||||||
Segment_Information_Tables
Segment Information (Tables) | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Segment Reporting [Abstract] | ||||||||
Segment Reporting Information, by Segment | The following tables provide summary financial information by reportable segment (in thousands): | |||||||
Three months ended | ||||||||
April 3, 2015 | March 28, 2014 | |||||||
Net revenue: | ||||||||
Video | $ | 69,282 | $ | 81,152 | ||||
Cable Edge | 34,734 | 26,880 | ||||||
Total consolidated net revenue | $ | 104,016 | $ | 108,032 | ||||
Operating income (loss): | ||||||||
Video | $ | (90 | ) | $ | 2,435 | |||
Cable Edge | 6,188 | 1,044 | ||||||
Total segment operating income | 6,098 | 3,479 | ||||||
Unallocated corporate expenses* | (44 | ) | (228 | ) | ||||
Stock-based compensation | (4,134 | ) | (3,807 | ) | ||||
Amortization of intangibles | (1,907 | ) | (6,666 | ) | ||||
Income (loss) from operations | 13 | (7,222 | ) | |||||
Non-operating income (expense) | (2,956 | ) | 89 | |||||
Loss before income taxes | $ | (2,943 | ) | $ | (7,133 | ) | ||
*Unallocated corporate expenses include certain corporate-level operating expenses and charges such as restructuring and related charges. |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 3 Months Ended | |||||||
Apr. 03, 2015 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ||||||||
Future Minimum Lease Payments Under Non-cancelable Operating Leases | Future minimum lease payments under non-cancelable operating leases as of April 3, 2015, after giving effect to $131,000 of future sublease income, are as follows (in thousands): | |||||||
Years ending December 31, | ||||||||
2015 (remaining 9 months) | $ | 7,591 | ||||||
2016 | 8,788 | |||||||
2017 | 8,067 | |||||||
2018 | 7,933 | |||||||
2019 | 7,885 | |||||||
Thereafter | 6,133 | |||||||
Total | $ | 46,397 | ||||||
Summary of Warranty Accrual Included in Accrued Liabilities | Activity for the Company’s warranty accrual, which is included in accrued liabilities, is summarized below (in thousands): | |||||||
Three months ended | ||||||||
April 3, | March 28, | |||||||
2015 | 2014 | |||||||
Balance at beginning of period | $ | 4,242 | $ | 3,606 | ||||
Accrual for current period warranties | 1,595 | 1,749 | ||||||
Warranty costs incurred | (1,746 | ) | (1,696 | ) | ||||
Balance at end of period | $ | 4,091 | $ | 3,659 | ||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 3 Months Ended | |||||||||||||||
Apr. 03, 2015 | ||||||||||||||||
Equity [Abstract] | ||||||||||||||||
Components of Accumulated Other Comprehensive Loss | The components of accumulated other comprehensive loss, on an after-tax basis where applicable, were as follows (in thousands): | |||||||||||||||
Foreign Currency Translation Adjustments | Unrealized Gains (Losses) on Cash Flow Hedges | Unrealized Gains (Losses) on Available-for-Sale Investments | Total | |||||||||||||
Balance as of December 31, 2014 | $ | (1,523 | ) | $ | 311 | $ | (768 | ) | $ | (1,980 | ) | |||||
Other comprehensive income (loss) before reclassifications | (984 | ) | (184 | ) | 485 | $ | (683 | ) | ||||||||
Amounts reclassified from AOCI | — | (49 | ) | — | (49 | ) | ||||||||||
Provision for income taxes | — | — | (4 | ) | (4 | ) | ||||||||||
Balance as of April 3, 2015 | $ | (2,507 | ) | $ | 78 | (287 | ) | (2,716 | ) | |||||||
The effects of amounts reclassified from AOCI into the condensed consolidated statement of operations were as follows (in thousands): | ||||||||||||||||
Three months ended | ||||||||||||||||
3-Apr-15 | 28-Mar-14 | |||||||||||||||
Gains on cash flow hedges from foreign currency contracts: | ||||||||||||||||
Cost of revenue | $ | 7 | $ | — | ||||||||||||
Operating expenses | 42 | — | ||||||||||||||
Total reclassifications from AOCI | $ | 49 | $ | — | ||||||||||||
ShortTerm_Investments_Summary_
Short-Term Investments - Summary of Short-Term Investments (Detail) (USD $) | Apr. 03, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | $22,197 | $31,845 |
Gross Unrealized Gains | 11 | 19 |
Gross Unrealized Losses | -5 | -17 |
Total short-term investments, Estimated Fair Value | 22,203 | 31,847 |
State, municipal and local government agencies bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 11,228 | 13,946 |
Gross Unrealized Gains | 10 | 16 |
Gross Unrealized Losses | 0 | -1 |
Total short-term investments, Estimated Fair Value | 11,238 | 13,961 |
Corporate bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 10,969 | 17,899 |
Gross Unrealized Gains | 1 | 3 |
Gross Unrealized Losses | -5 | -16 |
Total short-term investments, Estimated Fair Value | $10,965 | $17,886 |
ShortTerm_Investments_Maturiti
Short-Term Investments - Maturities of Short-Term Investments (Detail) (USD $) | Apr. 03, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Investments, Debt and Equity Securities [Abstract] | ||
Less than one year | $22,203 | $30,946 |
Due in 1 - 2 years | 0 | 901 |
Total short-term investments, Estimated Fair Value | $22,203 | $31,847 |
ShortTerm_Investments_Addition
Short-Term Investments - Additional Information (Detail) (USD $) | Apr. 03, 2015 | Dec. 31, 2014 |
Investments, Debt and Equity Securities [Abstract] | ||
Cost Method Investments | $6,700,000 | $8,600,000 |
Available-for-sale securities in a material unrealized loss position | $0 |
Investments_in_Other_Equity_Se2
Investments in Other Equity Securities Investments in Other Equity Securities (Details) (USD $) | 3 Months Ended | 1 Months Ended | 12 Months Ended | |||||
Apr. 03, 2015 | Mar. 28, 2014 | Sep. 30, 2014 | Dec. 31, 2014 | Sep. 26, 2014 | Sep. 02, 2014 | Oct. 22, 2014 | ||
Schedule of Cost-method Investments [Line Items] | ||||||||
Prepaid expenses and other current assets | $30,526,000 | $17,539,000 | ||||||
Cost Method Investments Carrying Value | 6,700,000 | 8,600,000 | ||||||
Loss on impairment of long-term investment | 2,505,000 | 0 | ||||||
Research and development | 22,329,000 | 23,888,000 | ||||||
VJU GmbH [Member] | ||||||||
Schedule of Cost-method Investments [Line Items] | ||||||||
Noncontrolling Interest, Ownership Percentage by Parent | 19.80% | |||||||
Cost Method Investments Original Cost | 2,500,000 | |||||||
Loss on impairment of long-term investment | 2,500,000 | |||||||
Research and development | 100,000 | |||||||
Vislink plc [Member] | ||||||||
Schedule of Cost-method Investments [Line Items] | ||||||||
Noncontrolling Interest, Ownership Percentage by Parent | 3.30% | |||||||
Cost Method Investments Original Cost | 3,300,000 | |||||||
Prepaid expenses and other current assets | 1,100,000 | 3,300,000 | ||||||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 3,300,000 | |||||||
Cost Method Investments Carrying Value | 3,100,000 | 2,600,000 | ||||||
Unrealized Loss on Cost Method Investments | 200,000 | 700,000 | ||||||
Loss on impairment of long-term investment | 0 | |||||||
EDC [Member] | ||||||||
Schedule of Cost-method Investments [Line Items] | ||||||||
Noncontrolling Interest, Ownership Percentage by Parent | 18.40% | |||||||
Cost Method Investments Original Cost | 3,500,000 | |||||||
Variable Interest Entity, Not Primary Beneficiary [Member] | ||||||||
Schedule of Cost-method Investments [Line Items] | ||||||||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 3,593,000 | [1] | ||||||
Cost Method Investments Carrying Value | 3,593,000 | |||||||
Variable Interest Entity, Not Primary Beneficiary [Member] | VJU GmbH [Member] | ||||||||
Schedule of Cost-method Investments [Line Items] | ||||||||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 0 | [1] | ||||||
Variable Interest Entity, Not Primary Beneficiary [Member] | EDC [Member] | ||||||||
Schedule of Cost-method Investments [Line Items] | ||||||||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 3,593,000 | [1],[2] | ||||||
Cost Method Investments Carrying Value | 3,593,000 | [2] | ||||||
Business Acquisition, Transaction Costs | 100,000 | [2] | ||||||
Cost-method Investments [Member] | Variable Interest Entity, Not Primary Beneficiary [Member] | VJU GmbH [Member] | ||||||||
Schedule of Cost-method Investments [Line Items] | ||||||||
Cost Method Investments Carrying Value | $0 | |||||||
[1] | The Company did not provide financial support to any of its unconsolidated VIEs and as of April 3, 2015, there were no explicit arrangements or implicit variable interests that could require the Company to provide financial support to any of its unconsolidated VIEs. | |||||||
[2] | maximum exposure to loss with respect to EDC as of April 3, 2015 was limited to a total investment cost of $3.6 million, including $0.1 million of transaction costs. |
Derivative_and_Hedgiing_Activi1
Derivative and Hedgiing Activities Derivatives and Hedging Activities - Additional Information (Details) (USD $) | 12 Months Ended | 3 Months Ended | |
Dec. 31, 2014 | Apr. 03, 2015 | Mar. 28, 2014 | |
Derivative [Line Items] | |||
Accumulated Other Comprehensive Income (Loss), Cumulative Changes in Net Gain (Loss) from Cash Flow Hedges, Effect Net of Tax | 311,000 | $78,000 | |
Designated as Hedging Instrument [Member] | Forward Contracts [Member] | |||
Derivative [Line Items] | |||
Derivative, Term of Contract | 12 months | ||
Not Designated as Hedging Instrument [Member] | Forward Contracts [Member] | |||
Derivative [Line Items] | |||
Derivative, Term of Contract | 3 months | ||
Other Comprehensive Income (Loss) [Member] | |||
Derivative [Line Items] | |||
Net unrealized gains in AOCI | 184,000 | 0 | |
Operating Expense [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||
Derivative [Line Items] | |||
Accumulated Other Comprehensive Income (Loss), Cumulative Changes in Net Gain (Loss) from Cash Flow Hedges, Effect Net of Tax | $78,000 |
Derivative_and_Hedgiing_Activi2
Derivative and Hedgiing Activities Derivative and Hedging Activities gain losses in Statement of Operations (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Derivatives, Fair Value [Line Items] | ||
Gains reclassified from accumulated OCI into income (effective portion) | $49 | $0 |
Other Comprehensive Income (Loss) [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Gains in accumulated OCI on derivatives (effective portion) | 184 | 0 |
Product cost of revenue [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Gains reclassified from accumulated OCI into income (effective portion) | 7 | 0 |
Operating Expense [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Gains reclassified from accumulated OCI into income (effective portion) | 42 | 0 |
Other Nonoperating Income (Expense) [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Loss recognized in income on derivatives (ineffectiveness portion and amount excluded from effectiveness testing) | -42 | 0 |
Other Nonoperating Income (Expense) [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Gains (losses) recognized in income | $252 | ($177) |
Derivative_and_Hedgiing_Activi3
Derivative and Hedgiing Activities Derivatives and Hedging Activities Notional Amounts (Details) (Foreign Exchange Forward [Member], USD $) | Apr. 03, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Long [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Asset, Notional Amount | $12,728 | $16,903 |
Long [Member] | Not Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Asset, Notional Amount | 6,585 | 1,043 |
Short [Member] | Not Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Liability, Notional Amount | $9,069 | $4,925 |
Derivative_and_Hedgiing_Activi4
Derivative and Hedgiing Activities Derivatives and Hedging Activities Assets Liabilities Balance Sheet Location (Details) (Foreign Exchange Contract [Member], USD $) | Apr. 03, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Current | $148 | $341 |
Derivative Liability, Current | 18 | 7 |
Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Current | 57 | 329 |
Derivative Liability, Current | 0 | 0 |
Designated as Hedging Instrument [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Current | 57 | 329 |
Designated as Hedging Instrument [Member] | Accrued Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability, Current | 0 | 0 |
Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Current | 91 | 12 |
Derivative Liability, Current | 18 | 7 |
Not Designated as Hedging Instrument [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Current | 91 | 12 |
Not Designated as Hedging Instrument [Member] | Accrued Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability, Current | $18 | $7 |
Derivative_and_Hedgiing_Activi5
Derivative and Hedgiing Activities Derivatives and Hedging Activities Asset and Liability Offset (Details) (USD $) | Apr. 03, 2015 |
In Thousands, unless otherwise specified | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Asset, Fair Value, Gross Asset | $148 |
Derivative Asset, Not Offset, Policy Election Deduction | 0 |
Derivative Asset Fair Value Net Amount After Not Offset Policy Election Deduction | 148 |
Derivative Asset, Collateral, Obligation to Return Cash, Offset | -18 |
Derivative Asset, Fair Value of Collateral | 0 |
Derivative Asset, Fair Value, Amount Offset Against Collateral | 130 |
Derivative Liability, Fair Value, Gross Liability | 18 |
Derivative Liability, Not Offset, Policy Election Deduction | 0 |
Derivative Liability Fair Value Net Amount After Not Offset Policy Election | 18 |
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | -18 |
Derivative Liability, Fair Value of Collateral | 0 |
Derivative Liability, Fair Value, Amount Offset Against Collateral | $0 |
Fair_Value_Measurements_Financ
Fair Value Measurements - Financial Assets and Liabilities Measured at Fair Value Based on Three-Tier Fair Value Hierarchy (Detail) (USD $) | Apr. 03, 2015 | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities, Fair Value Disclosure, Nonrecurring | $0 | |
Assets, Fair Value Disclosure, Nonrecurring | 0 | |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 58,228,000 | 57,915,000 |
Total liabilities measured and recorded at fair value | 18,000 | 7,000 |
Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 35,877,000 | 25,727,000 |
Total liabilities measured and recorded at fair value | 0 | 0 |
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 22,351,000 | 32,188,000 |
Total liabilities measured and recorded at fair value | 18,000 | 7,000 |
Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Total liabilities measured and recorded at fair value | 0 | 0 |
Cash equivalents [Member] | Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 32,795,000 | 23,121,000 |
Cash equivalents [Member] | Level 1 [Member] | Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 32,795,000 | 23,121,000 |
Cash equivalents [Member] | Level 2 [Member] | Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Cash equivalents [Member] | Level 3 [Member] | Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Short-term investments [Member] | State, municipal and local government agencies bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 11,238,000 | 13,961,000 |
Short-term investments [Member] | Corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 10,965,000 | 17,886,000 |
Short-term investments [Member] | Level 1 [Member] | State, municipal and local government agencies bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Short-term investments [Member] | Level 1 [Member] | Corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Short-term investments [Member] | Level 2 [Member] | State, municipal and local government agencies bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 11,238,000 | 13,961,000 |
Short-term investments [Member] | Level 2 [Member] | Corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 10,965,000 | 17,886,000 |
Short-term investments [Member] | Level 3 [Member] | State, municipal and local government agencies bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Short-term investments [Member] | Level 3 [Member] | Corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Prepaids and other current assets [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 148,000 | 341,000 |
Prepaids and other current assets [Member] | Level 1 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Prepaids and other current assets [Member] | Level 2 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 148,000 | 341,000 |
Prepaids and other current assets [Member] | Level 3 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Cost-method Investments [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 3,082,000 | 2,606,000 |
Cost-method Investments [Member] | Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 3,082,000 | 2,606,000 |
Accrued Liabilities [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 18,000 | 7,000 |
Accrued Liabilities [Member] | Level 1 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 0 | 0 |
Accrued Liabilities [Member] | Level 2 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 18,000 | 7,000 |
Accrued Liabilities [Member] | Level 3 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | $0 | $0 |
Balance_Sheet_Components_Accou
Balance Sheet Components - Accounts Receivable, Net, Prepaid Expenses and Other Current Assets, Inventories, Property and Equipment, Net (Detail) (USD $) | Apr. 03, 2015 | Dec. 31, 2014 | ||
In Thousands, unless otherwise specified | ||||
Accounts receivable, net: | ||||
Accounts receivable | $80,974 | $81,201 | ||
Less: allowances for doubtful accounts, returns and discounts | -5,110 | -7,057 | ||
Total | 75,864 | 74,144 | ||
Prepaid expenses and other current assets: | ||||
Prepaid inventories to contract manufacturer(1) | 14,200 | [1] | 0 | [1] |
Prepaid software license to Vislink(2) | 1,090 | [2] | 1,233 | [2] |
Other Prepayments | 9,953 | 9,713 | ||
Deferred cost of revenue | 3,364 | 2,524 | ||
Income tax receivable | 1,664 | 2,316 | ||
Other | 255 | 1,753 | ||
Prepaid Expense and Other Assets, Current | 30,526 | 17,539 | ||
Inventories: | ||||
Raw materials | 1,844 | 1,422 | ||
Work-in-process | 1,439 | 1,255 | ||
Finished goods | 28,235 | 30,070 | ||
Total inventories, net | 31,518 | 32,747 | ||
Property and equipment, net: | ||||
Furniture and fixtures | 7,690 | 7,691 | ||
Machinery and equipment | 116,895 | 116,031 | ||
Leasehold improvements | 9,550 | 8,140 | ||
Property and equipment, gross | 134,135 | 131,862 | ||
Less: accumulated depreciation and amortization | -106,995 | -104,641 | ||
Property and equipment, net | $27,140 | $27,221 | ||
[1] | In the first quarter of 2015, the Company made a $14.2 million advance payment for future inventory requirements to a supplier in order to secure more favorable pricing. The Company anticipates that this amount will begin to offset in the fourth quarter of 2015 through the first quarter of 2016 against the accounts payable owed to this supplier. | |||
[2] | The prepaid inventories were related to prepayment for software licenses made to Vislink (see Note 4, “Investments in Other Equity Securities,†for additional information on Vislink). |
Goodwill_and_Identified_Intang2
Goodwill and Identified Intangible Assets - Changes in Carrying Amount of Goodwill (Detail) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Apr. 03, 2015 |
Goodwill [Line Items] | |
Balance at beginning of period | $197,884 |
Foreign currency translation adjustment | -108 |
Balance at end of period | 197,776 |
Video [Member] | |
Goodwill [Line Items] | |
Balance at beginning of period | 136,975 |
Foreign currency translation adjustment | -75 |
Balance at end of period | 136,900 |
Cable Edge [Member] | |
Goodwill [Line Items] | |
Balance at beginning of period | 60,909 |
Foreign currency translation adjustment | -33 |
Balance at end of period | $60,876 |
Goodwill_and_Identified_Intang3
Goodwill and Identified Intangible Assets - Summary of Goodwill and Identified Intangible Assets (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Dec. 31, 2014 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 210,343 | $210,343 |
Accumulated Amortization | -201,651 | -199,744 |
Total future amortization expense | 8,692 | 10,599 |
Developed core technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 136,145 | 136,145 |
Accumulated Amortization | -135,887 | -135,426 |
Total future amortization expense | 258 | 719 |
Developed core technology [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 4 years | |
Developed core technology [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 6 years | |
Customer relationships/contracts [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 67,098 | 67,098 |
Accumulated Amortization | -60,001 | -58,784 |
Total future amortization expense | 7,097 | 8,314 |
Customer relationships/contracts [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 5 years | |
Customer relationships/contracts [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 6 years | |
Maintenance agreements and related relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 7,100 | 7,100 |
Accumulated Amortization | -5,763 | -5,534 |
Total future amortization expense | 1,337 | $1,566 |
Maintenance agreements and related relationships [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 6 years | |
Maintenance agreements and related relationships [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 7 years |
Goodwill_and_Identified_Intang4
Goodwill and Identified Intangible Assets - Amortization Expense for Identifiable Purchased Intangible Assets (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total amortization expense | $1,907 | $6,666 |
Included in cost of revenue [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total amortization expense | 461 | 4,716 |
Included in operating expenses [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total amortization expense | $1,446 | $1,950 |
Goodwill_and_Identified_Intang5
Goodwill and Identified Intangible Assets - Estimated Future Amortization Expense of Purchased Intangible Assets (Detail) (USD $) | Apr. 03, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
2015 (remaining 9 months) | $4,595 | |
2016 | 4,097 | |
Total future amortization expense | 8,692 | 10,599 |
Product cost of revenue [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
2015 (remaining 9 months) | 258 | |
2016 | 0 | |
Total future amortization expense | 258 | |
Operating Expenses [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
2015 (remaining 9 months) | 4,337 | |
2016 | 4,097 | |
Total future amortization expense | $8,434 |
Restructuring_and_Related_Char2
Restructuring and Related Charges - Activities in Restructuring Accrual (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |
Apr. 03, 2015 | Mar. 28, 2014 | Dec. 31, 2014 | |
Restructuring Cost and Reserve [Line Items] | |||
Product cost of revenue | $0 | $79,000 | |
Restructuring and related charges | 44,000 | 149,000 | |
Restructuring and Related Cost, Incurred Cost | 44,000 | 228,000 | |
Harmonic Two Thousand And Fifteen Restructuring [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Beginning Balance | 322,000 | ||
Restructuring charges | 56,000 | 2,200,000 | |
Adjustments to restructuring provisions | -12,000 | ||
Cash payments | -321,000 | ||
Non-cash write-offs | 2,000 | ||
Ending Balance | 47,000 | 322,000 | |
Harmonic Two Thousand And Fifteen Restructuring [Member] | Employee Severance And Benefit Arrangements [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and Related Cost, Incurred Cost | 44,000 | ||
Restructuring Reserve [Roll Forward] | |||
Beginning Balance | 305,000 | ||
Restructuring charges | 56,000 | 600,000 | |
Adjustments to restructuring provisions | -5,000 | ||
Cash payments | -312,000 | ||
Non-cash write-offs | 0 | ||
Ending Balance | 44,000 | 305,000 | |
Harmonic Two Thousand And Fifteen Restructuring [Member] | Other Restructuring [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Beginning Balance | 17,000 | ||
Restructuring charges | 0 | 100,000 | |
Adjustments to restructuring provisions | -7,000 | ||
Cash payments | -9,000 | ||
Non-cash write-offs | 2,000 | ||
Ending Balance | $3,000 | $17,000 |
Restructuring_and_Related_Char3
Restructuring and Related Charges - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||
Apr. 03, 2015 | Mar. 28, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | $44,000 | $228,000 | ||
Harmonic Two Thousand And Fifteen Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 56,000 | 2,200,000 | ||
Harmonic 2013 Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | 200,000 | 900,000 | 2,200,000 | |
Fixed Asset Impairment [Member] | Harmonic Two Thousand And Fifteen Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 1,100,000 | |||
Contract Termination [Member] | Harmonic Two Thousand And Fifteen Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 300,000 | |||
Other Restructuring [Member] | Harmonic Two Thousand And Fifteen Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 0 | 100,000 | ||
Employee Severance And Benefit Arrangements [Member] | Harmonic Two Thousand And Fifteen Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 56,000 | 600,000 | ||
Number of positions eliminated | 2 | 19 | ||
Restructuring and Related Cost, Incurred Cost | $44,000 | |||
Employee Severance And Benefit Arrangements [Member] | Harmonic 2013 Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Number of positions eliminated | 8 |
Credit_Facilities_Additional_I
Credit Facilities - Additional Information (Detail) (JPMorgan Chase [Member], USD $) | 3 Months Ended | |
Apr. 03, 2015 | Dec. 22, 2014 | |
Commercial Letters of Credit [Member] | Maximum [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Commitment Fee Percentage | 0.75% | |
Line of Credit Facility, Commitment Fee Amount | $100 | |
Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Percentage of Equity Interest Pledged as Collateral for Letter of Credit | 66.67% | |
Line of Credit Facility, Current Borrowing Capacity | 20,000,000 | |
Line of Credit Facility, Remaining Borrowing Capacity | 19,800,000 | |
Borrowings under bank line of credit facility | 0 | |
Credit facility collateral | Obligations under the Credit Agreement are secured only by a pledge of 66 2/3% of the Company’s equity interests in its foreign subsidiary, Harmonic International AG. Additionally, to the extent that the Company in the future forms any direct or indirect, domestic, material subsidiaries, those subsidiaries will be required to provide a guaranty of the Company’s obligations under the Credit Agreement. | |
Line of Credit Facility, Threshold Consecutive Business Days | 5 days | |
Debt Instrument, Fee Amount | 50,000 | |
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.25% | |
Line of Credit, Covenant, Consolidated Cash and Marketable Securities Minimum | 35,000,000 | |
Line of Credit Covenant, EBITDA, Minimum | 20,000,000 | |
Revolving Credit Facility [Member] | Minimum [Member] | ||
Line of Credit Facility [Line Items] | ||
Consolidated Cash Threshold | 30,000,000 | |
Standby letters of credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Current Borrowing Capacity | 10,000,000 | |
Line of Credit Facility, Remaining Borrowing Capacity | $200,000 | |
Line of Credit Facility, Commitment Fee Percentage | 1.75% | |
LIBOR [Member] | Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
LIBOR rate duration | LIBOR | |
Adjusted LIBOR Rate, Variable Rate, Period End Month One | 1 month | |
Adjusted LIBOR Rate, Variable Rate, Period End Month Two | 2 months | |
Adjusted LIBOR Rate, Variable Rate, Period End Month Three | 3 months | |
LIBOR [Member] | Revolving Credit Facility [Member] | Minimum [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit LIBOR margin | 2.50% | |
Adjusted LIBOR Rate Applicable Margin Rate [Member] | Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit LIBOR margin | 1.75% | |
Prime Rate [Member] | Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
LIBOR rate duration | prime | |
Adjusted Prime Rate Applicable Margin Rate [Member] | Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit LIBOR margin | -1.30% |
Employee_Benefit_Plans_Summary
Employee Benefit Plans - Summary of Company's Stock Option and Restricted Stock Unit Activity (Detail) (USD $) | 3 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Apr. 03, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares Available for Grant, Beginning balance | 7,480 |
Shares Available for Grant, Authorized | |
Shares Available for Grant, Granted | -3,037 |
Shares Available for Grant, Options exercised | 0 |
Shares Available for Grant, Shares released | 0 |
Shares Available for Grant, Forfeited or cancelled | 283 |
Shares Available for Grant, Ending balance | 4,726 |
Restricted Stock Units Outstanding [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Units, Beginning balance | 2,241 |
Number of Shares, Authorized | 0 |
Number of Units, Granted | 1,325 |
Number of Units, exercised | 0 |
Number of Units, Shares released | -925 |
Number of Units, Forfeited or cancelled | -73 |
Number of Units, Ending balance | 2,568 |
Weighted Average Grant Date Fair Value, Beginning balance | 6.4 |
Weighted Average Grant Date Fair Value, Authorized | 0 |
Estimated weighted average fair value per share at purchase date | 7.57 |
Weighted Average Grant Date Fair Value, Exercised | 0 |
Weighted Average Grant Date Fair Value, Shares released | 6.56 |
Weighted Average Grant Date Fair Value, Forfeited or cancelled | 6.23 |
Weighted Average Grant Date Fair Value, Ending balance | 7.01 |
Stock Options Outstanding [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares, Beginning balance | 7,255 |
Number of Shares, Authorized | 0 |
Number of Shares, Granted | 1,049 |
Number of Shares, Options exercised | -617 |
Number of Shares, Forfeited or cancelled | -172 |
Number of Shares, Ending balance | 7,515 |
Weighted Average Exercise Price, Beginning balance | 6.65 |
Weighted Average Exercise Price, Authorized | 0 |
Weighted Average Exercise Price, Granted | 7.58 |
Weighted Average Exercise Price, Options exercised | 5.49 |
Weighted Average Exercise Price, Forfeited or cancelled | 6.86 |
Weighted Average Exercise Price, Ending balance | 6.87 |
Employee_Benefit_Plans_Summary1
Employee Benefit Plans - Summary of Stock Options Outstanding (Detail) (Stock Options Outstanding [Member], USD $) | 3 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Apr. 03, 2015 |
Stock Options Outstanding [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares, Vested and expected to vest | 7,126 |
Weighted Average Exercise Price, Vested and expected to vest | $6.87 |
Weighted Average Remaining Contractual Term (Years), Vested and expected to vest | 3 years 8 months 12 days |
Aggregate Intrinsic Value, Vested and expected to vest | $6,331 |
Number of Shares, Exercisable | 4,694 |
Weighted Average Exercise Price, Exercisable | $6.94 |
Weighted Average Remaining Contractual Term (Years), Exercisable | 2 years 6 months |
Aggregate Intrinsic Value, Exercisable | $4,571 |
Employee_Benefit_Plans_Summary2
Employee Benefit Plans - Summary of Restricted Stock Units Outstanding (Detail) (Restricted Stock Units Outstanding [Member], USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Apr. 03, 2015 |
Restricted Stock Units Outstanding [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares Underlying Restricted Stock Units | 2,359 |
Weighted Average Remaining Vesting Period (Years) | 0 years 9 months 28 days |
Aggregate Fair Value | $17,407 |
Employee_Benefit_Plans_Additio
Employee Benefit Plans - Additional Information (Detail) (USD $) | 3 Months Ended | |
Apr. 03, 2015 | Mar. 28, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Intrinsic value of options exercised | $1,300,000 | $100,000 |
Increase in authorized shares for ESPP | ||
Discretionary contributions of plan | 25.00% | |
Percent of employees' gross pay eligible for matching | 4.00% | |
Maximum contribution amount per participant | 1,000 | |
Contributions in period | $161,000 | $173,000 |
Defined contribution plan description | The Company has a retirement/savings plan which qualifies as a thrift plan under Section 401(k) of the Internal Revenue Code. This plan allows participants to contribute up to the applicable Internal Revenue Code limitations under the plan. The Company has made discretionary contributions to the plan of 25% of the first 4% contributed by eligible participants, up to a maximum contribution per participant of $1,000 per year. | |
Employee Stock Purchase Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percentage of fair market value of Common Stock to purchase shares | 85.00% | |
Minimum [Member] | Employee Stock Purchase Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Employee Stock Purchase Plan Payroll Deductions | 1.00% | |
Maximum [Member] | Employee Stock Purchase Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Employee Stock Purchase Plan Payroll Deductions | 10.00% |
StockBased_Compensation_Summar
Stock-Based Compensation - Summary of Stock-Based Compensation Expense (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation | $4,134 | $3,807 |
Product cost of revenue [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation | 528 | 516 |
Research and development expense [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation | 1,148 | 1,101 |
Selling, general and administrative expense [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation | 2,458 | 2,190 |
Operating Expense [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation | $3,606 | $3,291 |
StockBased_Compensation_Valuat
Stock-Based Compensation - Valuation Assumptions for Stock Options (Detail) (USD $) | 3 Months Ended | 6 Months Ended | ||
Apr. 03, 2015 | Mar. 28, 2014 | Jun. 30, 2014 | Jun. 30, 2015 | |
Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected dividends | 0.00% | |||
Stock Options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 4 years 8 months 13 days | 4 years 8 months 13 days | ||
Volatility | 38.00% | 40.00% | ||
Risk-free interest rate | 1.60% | 1.70% | ||
Expected dividends | 0.00% | 0.00% | ||
Purchase Period June 30, 2014 [Member] | Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 0 years 6 months 1 day | |||
Volatility | 29.00% | |||
Risk-free interest rate | 0.10% | |||
Expected dividends | 0.00% | |||
Estimated weighted average fair value per share at purchase date | $1.71 | |||
Purchase Period June 30, 2015 [Member] | Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 0 years 5 months 27 days | |||
Volatility | 35.00% | |||
Risk-free interest rate | 0.10% | |||
Expected dividends | 0.00% | |||
Scenario, Forecast [Member] | Purchase Period June 30, 2015 [Member] | Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Estimated weighted average fair value per share at purchase date | $1.74 |
StockBased_Compensation_Additi
Stock-Based Compensation - Additional Information (Detail) (USD $) | 3 Months Ended | |
Apr. 03, 2015 | Mar. 28, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted-average fair value per share of options granted | $2.63 | $2.35 |
Fair value of options vested | $1,300,000 | $1,300,000 |
Total realized tax benefit | 120,000 | 185,000 |
Increase in authorized shares for ESPP | ||
Total unamortized stock-based compensation cost related to unvested stock options and restricted stock units | 20,100,000 | |
Remaining weighted-average amortization period | 2 years 1 month 21 days | |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected dividend yield | 0.00% | 0.00% |
Employee Stock Purchase Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected dividend yield | 0.00% | |
Discount percentage on purchase of stock | 15.00% | |
Fair Value of stock purchase rights percentage of call option | 85.00% | |
Value of stock purchase rights percentage of put option | 15.00% | |
Restricted Stock Units Outstanding [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Issuance of restricted stocks fair value | $6,100,000 | $5,400,000 |
StockBased_Compensation_Employ
Stock-Based Compensation - Employee Stock Purchase Plan (Detail) (Employee Stock Purchase Plan [Member], USD $) | 3 Months Ended | 6 Months Ended | |
Apr. 03, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected dividends | 0.00% | ||
Purchase Period June 30, 2014 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (years) | 0 years 6 months 1 day | ||
Volatility | 29.00% | ||
Risk-free interest rate | 0.10% | ||
Expected dividends | 0.00% | ||
Estimated weighted average fair value per share at purchase date | $1.71 | ||
Purchase Period June 30, 2015 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (years) | 0 years 5 months 27 days | ||
Volatility | 35.00% | ||
Risk-free interest rate | 0.10% | ||
Expected dividends | 0.00% | ||
Scenario, Forecast [Member] | Purchase Period June 30, 2015 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Estimated weighted average fair value per share at purchase date | $1.74 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Income Tax Disclosure [Abstract] | ||
Loss before income taxes | ($2,943) | ($7,133) |
Benefit from income taxes | ($286) | ($1,723) |
Effective income tax rate | 9.70% | 24.20% |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Income Tax Contingency [Line Items] | ||
Effective income tax rate | 9.70% | 24.20% |
Federal statutory income tax rate | 35.00% | 35.00% |
Unrecognized tax benefits that would impact the provision for income taxes | $16.30 | |
Interest and possible penalties related to uncertain tax positions | 0.6 | |
Potential decrease over the next twelve months for uncertain tax positions due to expiration of applicable statute of limitations | $1 | |
SWITZERLAND | ||
Income Tax Contingency [Line Items] | ||
Income Tax Holiday, Description | The Company's operations in Switzerland are subject to a reduced tax rate under the Switzerland tax holiday which requires various thresholds of investment and employment in Switzerland. The Company has met these various thresholds and the Switzerland tax holiday is effective through the end of 2018. | |
Pro Forma [Member] | ||
Income Tax Contingency [Line Items] | ||
Federal statutory income tax rate | 65.00% |
Income_Loss_Per_Share_Numerato
Income (Loss) Per Share - Numerators and Denominators of Basic and Diluted Net Income (Loss) Per Share Computations (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Numerator: | ||
Net loss | ($2,657) | ($5,410) |
Denominator: | ||
Basic and diluted | 88,655 | 97,921 |
Net loss per share: | ||
Basic and diluted | ($0.03) | ($0.06) |
Income_Loss_Per_Share_Antidilu
Income (Loss) Per Share - Anti-dilutive Securities (Detail) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Earnings Per Share [Abstract] | ||
Potentially dilutive equity awards outstanding | 9,641 | 11,072 |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 | Dec. 31, 2014 | Dec. 31, 2013 |
segment | segment | |||
Segment Reporting Information [Line Items] | ||||
Revenue, Net | $104,016 | $108,032 | ||
Number of Reportable Segments | 2 | 1 | ||
Income (loss) from operations | 13 | -7,222 | ||
Operating Expenses | -55,015 | -59,534 | ||
Stock-based compensation | -4,134 | -3,807 | ||
Amortization of Intangible Assets | -1,907 | -6,666 | ||
Nonoperating Income (Expense) | -2,956 | 89 | ||
Loss before income taxes | -2,943 | -7,133 | ||
Video [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue, Net | 69,282 | 81,152 | ||
Cable Edge [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue, Net | 34,734 | 26,880 | ||
Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Income (loss) from operations | 6,098 | 3,479 | ||
Operating Segments [Member] | Video [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Income (loss) from operations | -90 | 2,435 | ||
Operating Segments [Member] | Cable Edge [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Income (loss) from operations | 6,188 | 1,044 | ||
Corporate, Non-Segment [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Operating Expenses | ($44) | ($228) |
Commitments_and_Contingencies_1
Commitments and Contingencies - Additional Information (Detail) (USD $) | Apr. 03, 2015 | Jun. 29, 2012 | Oct. 31, 2011 |
Patents | Patents | ||
Contingencies And Commitments [Line Items] | |||
Future sublease income | $131,000 | ||
Non-cancelable purchase commitments | 22,600,000 | ||
Maximum amount of potential future payments under the company's financial guarantees | 400,000 | ||
Infringements of number of patents held | 1 | 2 | |
Israel [Member] | |||
Contingencies And Commitments [Line Items] | |||
Guarantees related to rent obligations | 400,000 | ||
Indemnification [Member] | |||
Contingencies And Commitments [Line Items] | |||
Accrual for indemnification provisions | $0 |
Commitments_and_Contingencies_2
Commitments and Contingencies - Future Minimum Lease Payments Under Non-cancelable Operating Leases (Detail) (USD $) | Apr. 03, 2015 |
In Thousands, unless otherwise specified | |
Commitments and Contingencies Disclosure [Abstract] | |
2015 (remaining 9 months) | $7,591 |
2016 | 8,788 |
2017 | 8,067 |
2018 | 7,933 |
2019 | 7,885 |
Thereafter | 6,133 |
Total | $46,397 |
Commitments_and_Contingencies_3
Commitments and Contingencies - Summary of Warranty Accrual Included in Accrued Liabilities (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Commitments and Contingencies Disclosure [Abstract] | ||
Balance at beginning of period | $4,242 | $3,606 |
Accrual for current period warranties | 1,595 | 1,749 |
Warranty costs incurred | -1,746 | -1,696 |
Balance at end of period | $4,091 | $3,659 |
Stockholders_Equity_Components
Stockholders' Equity - Components of Accumulated Other Comprehensive Loss (Detail) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 | Dec. 31, 2014 |
Equity [Abstract] | |||
Foreign currency translation adjustments | ($2,507) | ($1,523) | |
Accumulated Other Comprehensive Income (Loss), Cumulative Changes in Net Gain (Loss) from Cash Flow Hedges, Effect Net of Tax | 78 | 311 | |
Unrealized gain on investments | -287 | -768 | |
Accumulated Other Comprehensive Loss | -2,716 | -1,980 | |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, before Tax | -984 | 40 | |
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | -184 | 0 | |
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, before Tax | 485 | 7 | |
Other Comprehensive Income (Loss), before Reclassifications, before Tax | -683 | ||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, before Tax | 0 | ||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, before Tax | -49 | 0 | |
Other Comprehensive (Income) Loss, Reclassification Adjustment from AOCI for Write-down of Securities, before Tax | 0 | ||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | -49 | ||
Other Comprehensive Income (Loss), Foreign Currency Translation Gain (Loss) Arising During Period, Tax | 0 | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Tax | 0 | ||
Other Comprehensive Income (Loss), Available-for-sale Securities, Tax | -4 | ||
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent | ($4) |
Stockholders_Equity_Stockholde
Stockholders' Equity Stockholders' Equity - Reclassification from AOCI to Statement of Operations (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Apr. 03, 2015 | Mar. 28, 2014 |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion | $49 | $0 |
Product cost of revenue [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion | 7 | 0 |
Operating Expense [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion | $42 | $0 |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | 35 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | 14-May-14 | Dec. 31, 2013 | Apr. 03, 2015 | 14-May-14 | Apr. 24, 2012 |
Stockholders' Equity Note [Abstract] | |||||
Authorized stock repurchase value | $220 | $300 | $25 | ||
Increase in stock repurchase program | 80 | 195 | |||
Stock Repurchased and Retired During Period, Shares | 37.9 | ||||
Weighted average purchase price per share | $6.23 | ||||
Stock Repurchased and Retired During Period, Value | 237.5 | ||||
Stock Repurchased and Retired During Period, Expenses | 1 | ||||
Remaining authorized repurchase amount | $63.50 |