Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Sep. 30, 2014 | Nov. 28, 2014 | Mar. 31, 2014 | |
Document And Entity Information [Abstract] | ' | ' | ' |
Entity Registrant Name | 'VITESSE SEMICONDUCTOR CORP | ' | ' |
Entity Central Index Key | '0000880446 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 30-Sep-14 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--09-30 | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' |
Document Fiscal Year Focus | '2014 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 67,903,274 | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Public Float | ' | ' | $240,177,399 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash | $71,903 | $68,863 |
Accounts receivable | 10,850 | 9,807 |
Inventories | 12,792 | 10,692 |
Restricted cash | 794 | 101 |
Prepaid expenses and other current assets | 1,047 | 1,796 |
Total current assets | 97,386 | 91,259 |
Property, plant and equipment, net | 2,858 | 3,107 |
Other intangible assets, net | 1,476 | 1,170 |
Other assets | 3,104 | 3,425 |
Total Assets | 104,824 | 98,961 |
Current liabilities: | ' | ' |
Accounts payable | 6,814 | 7,436 |
Accrued expenses and other current liabilities | 12,472 | 12,245 |
Current portion of debt, net | 32,727 | 0 |
Deferred revenue | 4,902 | 2,215 |
Total current liabilities | 56,915 | 21,896 |
Other long-term liabilities | 234 | 407 |
Long-term debt, net | 16,417 | 16,366 |
Convertible subordinated debt, net | 0 | 44,384 |
Total liabilities | 73,566 | 83,053 |
Commitments and contingencies, See notes 11 and 12 | ' | ' |
Stockholders’ equity: | ' | ' |
Preferred stock, $0.01 par value: 10,000 shares authorized; no shares issued or outstanding | 0 | 0 |
Common stock, $0.01 par value: 250,000 shares authorized; 67,703 and 57,545 shares outstanding at September 30, 2014 and 2013, respectively | 677 | 575 |
Additional paid-in-capital | 1,924,984 | 1,891,661 |
Accumulated deficit | -1,894,403 | -1,876,328 |
Total stockholders’ equity | 31,258 | 15,908 |
Total Liabilities and Stockholders' Deficit | $104,824 | $98,961 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
Statement of Financial Position [Abstract] | ' | ' |
Preferred stock, par value (in dollars per share) | $0.01 | $0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares outstanding | 67,703,000 | 57,545,000 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Net revenues: | ' | ' | ' |
Product revenues | $102,751 | $101,334 | $109,920 |
Intellectual property revenues | 5,746 | 2,439 | 9,563 |
Net revenues | 108,497 | 103,773 | 119,483 |
Costs and expenses: | ' | ' | ' |
Cost of product revenues | 44,480 | 46,763 | 46,407 |
Engineering, research and development | 42,450 | 41,927 | 42,713 |
Selling, general and administrative | 30,981 | 30,210 | 29,822 |
Restructuring and impairment | 0 | 0 | -1,424 |
Amortization of intangible assets | 360 | 347 | 330 |
Costs and expenses | 118,271 | 119,247 | 117,848 |
(Loss) income from operations | -9,774 | -15,474 | 1,635 |
Other expense (income): | ' | ' | ' |
Interest expense, net | 6,227 | 7,916 | 7,778 |
Gain on compound embedded derivative | 0 | -803 | -4,897 |
Loss on extinguishment of debt | 1,594 | 0 | 0 |
Other expense, net | 139 | 39 | 40 |
Other expense, net | 7,960 | 7,152 | 2,921 |
Loss before income tax expense (benefit) | -17,734 | -22,626 | -1,286 |
Income tax expense (benefit) | 341 | -548 | -174 |
Net loss | ($18,075) | ($22,078) | ($1,112) |
Net loss per common share - basic and diluted (in dollars per share) | ($0.30) | ($0.55) | ($0.04) |
Weighted average common shares outstanding - basic and diluted (in shares) | 60,887 | 40,311 | 25,121 |
CONSOLIDATED_STATEMENTS_OF_STO
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (EQUITY) DEFICIT (USD $) | Total | Parent | Preferred Stock | Common Stock | Additional Paid-in-Capital | Accumulated Deficit |
In Thousands, except Share data, unless otherwise specified | ||||||
Balance at Sep. 30, 2011 | ' | ($28,459) | $1 | $245 | $1,824,433 | ($1,853,138) |
Balance (in shares) at Sep. 30, 2011 | ' | ' | 135,000 | 24,471,000 | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' |
Net loss | -1,112 | -1,112 | ' | ' | ' | -1,112 |
Compensation expense related to stock options, awards and ESPP | ' | 4,442 | ' | ' | 4,442 | ' |
Issuance of common stock upon exercise of stock options (in shares) | ' | ' | ' | 6,000 | ' | ' |
Issuance of common stock upon exercise of stock options | ' | 16 | ' | ' | 16 | ' |
Issuance of shares under ESPP (in shares) | ' | ' | ' | 821,000 | ' | ' |
Issuance of shares under employee stock purchase plan | ' | 1,737 | ' | 8 | 1,729 | ' |
Release of restricted stock units (in shares) | ' | ' | ' | 721,000 | ' | ' |
Release of restricted stock units | ' | ' | ' | 7 | -7 | ' |
Repurchase and retirement of restricted stock units for payroll taxes (in shares) | ' | ' | ' | -207,000 | ' | ' |
Repurchase and retirement of restricted stock units for payroll taxes | ' | -639 | ' | -2 | -637 | ' |
Balance at Sep. 30, 2012 | ' | -24,015 | 1 | 258 | 1,829,976 | -1,854,250 |
Balance (in shares) at Sep. 30, 2012 | ' | ' | 135,000 | 25,812,000 | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' |
Net loss | -22,078 | -22,078 | ' | ' | ' | -22,078 |
Compensation expense related to stock options, awards and ESPP | ' | 4,396 | ' | ' | 4,396 | ' |
Issuance of common stock upon exercise of stock options (in shares) | ' | ' | ' | 9,000 | ' | ' |
Issuance of common stock upon exercise of stock options | ' | 20 | ' | ' | 20 | ' |
Issuance of shares under ESPP (in shares) | ' | ' | ' | 953,000 | ' | ' |
Issuance of shares under employee stock purchase plan | ' | 1,666 | ' | 9 | 1,657 | ' |
Issuance of common stock, net of offering costs (in shares) | ' | ' | ' | 29,371,000 | ' | ' |
Issuance of common stock, net of offering costs | ' | 54,441 | ' | 294 | 54,147 | ' |
Conversion of Series B Preferred Shares (in shares) | ' | ' | -135,000 | 674,000 | ' | ' |
Conversion of Series B Preferred Shares | ' | ' | -1 | 7 | -6 | ' |
Release of restricted stock units (in shares) | ' | ' | ' | 1,045,000 | ' | ' |
Release of restricted stock units | ' | ' | ' | 10 | -10 | ' |
Repurchase and retirement of restricted stock units for payroll taxes (in shares) | ' | ' | ' | -319,000 | ' | ' |
Repurchase and retirement of restricted stock units for payroll taxes | ' | -618 | ' | -3 | -615 | ' |
Reclassification of compound embedded derivative liability to additional paid-in capital | ' | 2,096 | ' | ' | 2,096 | ' |
Balance at Sep. 30, 2013 | ' | 15,908 | ' | 575 | 1,891,661 | -1,876,328 |
Balance (in shares) at Sep. 30, 2013 | ' | ' | ' | 57,545,000 | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' |
Net loss | -18,075 | -18,075 | ' | ' | ' | -18,075 |
Compensation expense related to stock options, awards and ESPP | ' | 6,075 | ' | ' | 6,075 | ' |
Issuance of common stock upon exercise of stock options (in shares) | ' | ' | ' | 52,000 | ' | ' |
Issuance of common stock upon exercise of stock options | ' | 122 | ' | 1 | 121 | ' |
Issuance of shares under ESPP (in shares) | ' | ' | ' | 722,000 | ' | ' |
Issuance of shares under employee stock purchase plan | ' | 1,815 | ' | 7 | 1,808 | ' |
Issuance of common stock, net of offering costs (in shares) | ' | ' | ' | 8,582,000 | ' | ' |
Issuance of common stock, net of offering costs | ' | 26,605 | ' | 86 | 26,519 | ' |
Release of restricted stock units (in shares) | ' | ' | ' | 1,183,000 | ' | ' |
Release of restricted stock units | ' | ' | ' | 12 | -12 | ' |
Repurchase and retirement of restricted stock units for payroll taxes (in shares) | ' | ' | ' | -381,000 | ' | ' |
Repurchase and retirement of restricted stock units for payroll taxes | ' | -1,254 | ' | -4 | -1,250 | ' |
Other | ' | 62 | ' | ' | 62 | ' |
Balance at Sep. 30, 2014 | ' | $31,258 | ' | $677 | $1,924,984 | ($1,894,403) |
Balance (in shares) at Sep. 30, 2014 | ' | ' | ' | 67,703,000 | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows (used in) provided by operating activities: | ' | ' | ' |
Net loss | ($18,075) | ($22,078) | ($1,112) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ' | ' | ' |
Depreciation and amortization | 2,041 | 2,375 | 2,963 |
Stock-based compensation | 6,075 | 4,396 | 4,442 |
Change in fair value of compound embedded derivative liability | 0 | -803 | -4,897 |
Deferred income taxes | -15 | 156 | -1,537 |
Restructuring charges | 0 | 0 | -1,424 |
Loss on asset impairment | 0 | 0 | 1,324 |
Gain on disposal of assets | -131 | -153 | 0 |
Loss on extinguishment of debt, net | 1,594 | 0 | 0 |
Amortization of debt issuance costs | 190 | 272 | 272 |
Amortization of debt discounts | 1,806 | 2,552 | 2,363 |
Accretion of debt premiums | -15 | -171 | -157 |
Change in operating assets and liabilities: | ' | ' | ' |
Accounts receivable | -1,043 | -404 | 188 |
Inventories | -2,100 | 1,368 | 8,797 |
Prepaids and other assets | 601 | 535 | 739 |
Accounts payable | -673 | 1,710 | 528 |
Accrued expenses and other current liabilities | 112 | -218 | -2,410 |
Deferred revenue | 2,687 | 1,344 | -3,007 |
Net cash (used in) provided by operating activities | -6,946 | -9,119 | 7,072 |
Cash flows used in investing activities: | ' | ' | ' |
Capital expenditures | -1,484 | -1,306 | -808 |
Payments under licensing agreements | -510 | -342 | -867 |
Proceeds from sale of fixed assets | 183 | 156 | 73 |
Net cash used in investing activities | -1,811 | -1,492 | -1,602 |
Cash flows provided by financing activities: | ' | ' | ' |
Proceeds from the exercise of stock options and issuances of shares under the employee stock purchase plan | 1,937 | 1,686 | 1,753 |
Net proceeds from the sale of common stock | 26,656 | 54,520 | 0 |
Repurchase of convertible subordinated debentures | -14,606 | 0 | 0 |
Consent fee on amendment of credit agreement | -308 | 0 | 0 |
Cash restricted under credit agreement | -687 | 0 | 0 |
Prepayment fee on senior debt | 0 | 0 | 0 |
Repurchase and retirement of restricted stock units for payroll taxes | -1,254 | -618 | -639 |
Other | 59 | -5 | -11 |
Net cash provided by financing activities | 11,797 | 55,583 | 1,103 |
Net increase in cash | 3,040 | 44,972 | 6,573 |
Cash at beginning of year | 68,863 | ' | 23,891 |
Cash at end of year | 71,903 | 68,863 | ' |
Cash paid (refunded) during the fiscal year for: | ' | ' | ' |
Interest | 4,861 | 5,323 | 5,341 |
Income taxes | -20 | -1,245 | 1,440 |
Non cash investing and financing activities: | ' | ' | ' |
Common stock issued in exchange for Series B Preferred Shares | 0 | 7 | 0 |
Licensing agreement obligation incurred but not paid | 156 | 0 | 0 |
2014 Debentures | ' | ' | ' |
Non cash investing and financing activities: | ' | ' | ' |
Equity offering costs incurred but not paid | 51 | 79 | 0 |
2024 Debentures | Common stock | ' | ' | ' |
Non cash investing and financing activities: | ' | ' | ' |
Reclassification of compound embedded derivative liability to additional paid-in-capital | $0 | $2,096 | $0 |
THE_COMPANY_AND_ITS_SIGNIFICAN
THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Sep. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES | ' |
THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES | |
Description of Business | |
Vitesse Semiconductor Corporation (“Vitesse,” the “Company,” “us,” “we” or “our”) is a leading supplier of high-performance integrated circuits (“ICs”), associated application and protocol software, and integrated turnkey systems solutions used primarily by manufacturers of networking systems for Carrier, Enterprise and Industrial Internet of Things (“IoT”) networking applications. With these solutions, we enable networking industries to transition from legacy networks to standards-based, ubiquitous ‘Ethernet Everywhere’ networking, starting from Enterprise networks and Carrier networks, and now penetrating Industrial-IoT networks. | |
Vitesse was incorporated in the state of Delaware in 1987. Our headquarters are located at 4721 Calle Carga, Camarillo, California, and our phone number is (805) 388-3700. Our stock trades on the NASDAQ Global Market under the ticker symbol VTSS. | |
Fiscal Year | |
Our fiscal year is October 1 through September 30. | |
Basis of Presentation | |
The accompanying consolidated financial statements are prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and accounting principles generally accepted in the United States of America (“GAAP”). Our reporting currency is the United States dollar. Our consolidated financial statements include the accounts of Vitesse and our subsidiaries. All inter-company accounts and transactions were eliminated in consolidation. | |
Reclassifications | |
Certain reclassifications have been made to prior fiscal year amounts and related footnotes to conform to current fiscal year presentation with no changes to stockholders’ equity (deficit) amounts or net loss for fiscal year 2013 or 2012. | |
Foreign Currency Translation | |
The functional currency of our foreign subsidiaries is the United States dollar; however, our foreign subsidiaries transact in local currencies. Consequently, assets and liabilities are translated into United States dollars at the exchange rate on the balance sheet date. Revenues and expenses are translated at the average exchange rate prevailing during the period. Foreign currency transaction and translation gains and losses are included in results of operations. | |
Use of Estimates | |
The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and disclosures made in the accompanying notes to the consolidated financial statements. Management regularly evaluates estimates and assumptions related to revenue recognition, allowances for doubtful accounts, warranty reserves, inventory valuation reserves, stock-based compensation, compound embedded derivative valuation, purchased intangible asset valuations and useful lives, asset retirement obligations, and deferred income tax asset valuation allowances. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The actual results we experience may differ materially and adversely from our original estimates. To the extent there are material differences between the estimates and the actual results, our future results of operations will be affected. | |
Revenue Recognition | |
Product Revenues | |
In accordance with Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition, we recognize product revenues when the following fundamental criteria are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the price to the customer is fixed or determinable; and (iv) collection of the sales price is reasonably assured. Delivery occurs when goods are shipped and title and risk of loss transfer to the customer, in accordance with the terms specified in the arrangement with the customer. Revenue recognition is deferred where the earnings process is incomplete. | |
A portion of our product sales is made through distributors under agreements allowing for pricing credits and/or right of return. Our past history with these pricing credits and/or right of return provisions prevent us from being able to reasonably estimate the final price of our inventory to be sold and the amount of inventory that could be returned pursuant to these agreements. As a result, the fixed and determinable revenue recognition criterion has not been met at the time we deliver products allowing for pricing credits or right of returns. Accordingly, product revenues from sales made through these distributors is not recognized until the distributors ship the product to their customers. We also maintain inventory, or hub, arrangements with certain customers. Pursuant to these arrangements, we deliver products to a customer or a designated third-party warehouse based upon the customer’s projected needs, but do not recognize revenue unless and until the customer reports that it has removed our product from the warehouse and taken title and risk of loss. | |
From time-to-time, we may ship goods to our distributors with no pricing credits and/or no or limited right of return. Under these circumstances, at the time of shipment, product prices are fixed or determinable and the amount of future returns and pricing allowances to be granted in the future can be reasonably estimated and are accrued. Accordingly, revenues are recorded net of these estimated amounts. | |
Intellectual Property Revenues | |
We derive intellectual property revenues from the sale and licensing of our intellectual property, maintenance and support and royalty revenues following the sale by our licensees of products incorporating the licensed technology. We enter into intellectual property licensing agreements that generally provide licensees the right to incorporate our intellectual property components in their products with terms and conditions that vary by licensee. Our intellectual property licensing agreements may include multiple elements with an intellectual property license bundled with support services. For such multiple element intellectual property licensing arrangements, we follow the guidance in ASC Topic 605-25, Multiple-Element Arrangements, to determine whether there is more than one unit of accounting. | |
We recognize revenue from the sale of patents when there is persuasive evidence of an arrangement, fees are fixed or determinable, delivery has occurred, and collectability is reasonably assured. All of the requirements are generally fulfilled upon execution of the patent sale arrangement. | |
License and contract revenues are recorded upon delivery of the technology when there is persuasive evidence of an arrangement, fees are fixed or determinable, delivery has occurred, and collectability is reasonably assured. The timing of delivery is dependent on, and varies with, the terms of each contract. Other than maintenance and support, there is no continuing obligation under these arrangements after delivery of the intellectual property. Deferred revenue is created when we bill a customer in accordance with a contract prior to having met the requirements for revenue recognition. | |
Certain of our agreements may contain support obligations. Under such agreements we provide unspecified fixes and technical support. No other upgrades, products, or post-contract support are provided. These arrangements may be renewable annually by the customer. Support revenues are recognized ratably over the period during which the obligation exists, typically 12 months or less. | |
We recognize royalty revenues in the period in which the licensee reports shipment of products incorporating our intellectual property components. Royalties are calculated on a per unit basis, as specified in our agreement with the licensee. We may, at our discretion and in accordance with our agreements, engage a third-party to perform royalty audits of our licensees. Any correction of royalties previously reported would occur when the results are resolved. | |
For multiple-element arrangements, we allocate revenue to all deliverables based on their relative selling prices. In such circumstances, we use a hierarchy to determine the selling price to be used for allocating revenues to deliverables: (i) vendor-specific objective evidence of fair value (“VSOE”); (ii) third-party evidence of selling price (“TPE”); and (iii) best estimate of the selling price (“ESP”). VSOE generally exists only when we sell the deliverable separately and revenue is the price actually charged by us for that deliverable. Generally, we are not able to determine TPE because our licensing arrangements differ from that of our peers. We have concluded that no VSOE or TPE exists because it is rare that either we or our competitors sell the deliverables on a stand-alone basis. ESPs reflect our best estimate of what the selling prices of the elements would be if they were sold regularly on a stand-alone basis. While changes in the allocation of the estimated sales price between the units of accounting will not affect the amount of total revenue recognized for a particular sales arrangement, any material changes in these allocations could impact the timing of revenue recognition, which could affect our results of operations. | |
In determining ESPs, we apply significant judgment as we weigh a variety of factors, based on the facts and circumstances of the arrangement. The facts and circumstances we may consider include, but are not limited to, prices charged for similar offerings, if any, our historical pricing practices as well as the nature and complexity of different technologies being licensed, geographies and the number of uses allowed for a given license. | |
Shipping and Handling Fees and Costs | |
Amounts billed to customers for shipping and handling is presented in product revenues. Costs incurred for shipping and handling are included in cost of revenues. | |
Engineering, Research and Development Costs | |
Engineering, research and development (“R&D”) costs are expensed when incurred. R&D expenses consist primarily of compensation expenses for employees and contractors engaged in research, design and development activities. R&D expenses also include costs of mask tooling, which we fully expense in the period, electronic design automation tools, software licensing contracts, subcontracting and fabrication, depreciation and amortization, and overhead including facilities expenses. | |
Intellectual property purchased from third parties is capitalized and amortized over the useful life of the intellectual property. | |
Marketing Costs | |
All of the costs related to marketing and advertising our products are expensed as incurred or at the time the marketing takes place. | |
Stock‑Based Compensation | |
ASC Topic 718, Compensation-Stock Compensation (“ASC 718”) requires that all stock‑based payments to employees, including grants of employee stock options and employee stock purchase rights, to be recognized in the financial statements based on their respective grant date fair values. The benefits of tax deductions in excess of recognized compensation cost are required to be reported as a financing cash flow, rather than operating cash flow, as required under previous literature. It is also required to calculate the compensation cost of full-value awards such as restricted stock based on the market value of the underlying stock at the date of the grant. We estimate the expected life of a stock award as the period of time that the award is expected to be outstanding. Expected lives are estimated in accordance with SEC Staff Accounting Bulletin (“SAB”) No. 107, as amended by SAB No. 110, which provides supplemental application guidance based on the views of the SEC. We are further required to estimate the fair value of stock‑based payment awards on the date of grant using an option‑pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense ratably over the requisite service periods. We estimate the fair value of each award as of the date of grant using the Black‑Scholes option pricing model, which was developed for use in estimating the value of traded options that have no vesting restrictions and that are freely transferable. The Black‑Scholes model considers, among other factors, the expected life of the award and the expected volatility of our stock price. Although the Black‑Scholes model meets the accounting guidance requirements, the fair values generated by the model may not be indicative of the actual fair values of our awards, as it does not consider other factors important to those stock-based payment awards, such as continued employment, periodic vesting requirements, and limited transferability. | |
We have elected to recognize compensation expense for all stock‑based awards on a straight-line basis over the requisite service period for the entire award. The amount of compensation expense recognized through the end of each reporting period is equal to the portion of the grant-date value of the awards that have vested, or for partially vested awards, the value of the portion of the award that is ultimately expected to vest for which the requisite services have been provided. | |
Other Income, Net | |
Other income, net, consists of interest income, foreign exchange gains and losses and other non-operating gains and losses. | |
Income Taxes | |
We account for income taxes pursuant to the provisions of ASC Topic 740, Income Taxes (“ASC 740”). Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards. We assess the likelihood that our deferred tax assets will be recovered from future taxable income and to the extent we believe that recovery is not “more likely than not,” we establish a valuation allowance. To the extent we establish a valuation allowance or increase or decrease this allowance in a period, we include an expense or benefit within the tax provision in the statement of operations. ASC Topic 740-10 prescribes a “more likely than not” recognition threshold and measurement analysis for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. We recognize potential accrued interest and penalties related to unrecognized tax benefits within the consolidated statements of operations as income tax expense. | |
Net Loss per Share | |
Basic and diluted net income and loss per share is computed by dividing net income or loss by the weighted average number of common shares outstanding during the period. | |
For periods in which we report net income, the weighted average number of shares used to calculate diluted income per share is inclusive of common stock equivalents from unexercised stock options, restricted stock units, shares to be issued under our Employee Stock Purchase Plan (“ESPP”), convertible preferred stock, convertible subordinated debentures (“2014 Debentures”) and senior term B loan. Unexercised stock options, restricted stock units, and unvested shares to be issued under our ESPP, are considered to be common stock equivalents if, using the treasury stock method, they are determined to be dilutive. | |
Under the two-class method of determining earnings for each class of stock, we consider the dividend rights and participating rights in undistributed earnings for each class of stock. The allocation of undistributed earnings to preferred shares is equal to the amount of earnings per common share that would be distributed on an as-converted basis. | |
Risks and Uncertainties | |
Our future results of operations involve a number of risks and uncertainties. Factors that could affect our business or future results and cause actual results to vary materially from historical results include, but are not limited to, the highly cyclical nature of the semiconductor industry; our high fixed costs; declines in average selling prices; decisions by our IC manufacturer customers to curtail outsourcing; our substantial indebtedness; our ability to fund liquidity needs; our failure to maintain an effective system of internal controls; product return and liability risks; the absence of significant backlog in our business; our dependence on international operations and sales; proposed changes to United States tax laws; that our management information systems may prove inadequate; our ability to attract and retain qualified employees; difficulties consolidating and evolving our operational capabilities; our dependence on materials and equipment suppliers; our loss of customers; adverse tax consequences; the development of new proprietary technology and the enforcement of intellectual property rights by or against us; the complexity of packaging and test processes in our industry; competition; our need to comply with existing and future environmental regulations; and fire, flood or other calamity affecting us or others with whom we do business. | |
Financial instruments, which potentially subject us to concentrations of credit risk, consist principally of cash and accounts receivable. Cash consists of demand deposits maintained with several financial institutions, which often exceed Federal Deposit Insurance Corporation limits of $250,000. We have never experienced any losses related to these balances; however, our balances are significantly in excess of insured limits. | |
At September 30, 2014, there were two customers that accounted for 24.3% of accounts receivable. At September 30, 2013, there were two customers that accounted for 23.8% of accounts receivable. We believe that this concentration and the concentration of credit risk resulting from trade receivables owing from high-technology industry customers is substantially mitigated by our credit evaluation process, relatively short collection periods and maintaining an allowance for anticipated losses. We generally do not require collateral security for outstanding amounts. | |
We currently purchase wafers from a limited number of vendors. Additionally, since we do not maintain manufacturing facilities, we depend upon close relationships with contract manufacturers to assemble our products. We believe there are other vendors who can provide the same quality wafers at competitive prices and other contract manufacturers that can provide comparable services at competitive prices. We anticipate the continued use of a limited number of vendors and contract manufacturers in the near future. We are also dependent upon third parties for our probe testing. Under our fabless business model, our long-term revenue growth is dependent on our ability to obtain sufficient external manufacturing capacity, including wafer production capacity. We believe that in addition to the vendors currently utilized by us, other vendors would be able to provide these services. | |
Accounts Receivable and Allowance for Doubtful Accounts | |
Accounts receivable are recorded at the invoice amount and presented net of the allowance for doubtful accounts; they do not bear interest. We evaluate the collectability of accounts receivable at each balance sheet date using a combination of factors, such as historical experience, credit quality, age of the accounts receivable balances, and economic conditions that may affect a customer’s ability to pay. We include any accounts receivable balances that are determined to be uncollectible in the overall allowance for doubtful accounts using the specific identification method. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. Our allowance for doubtful accounts was nil as of September 30, 2014 and 2013. | |
Inventories | |
Inventories are stated at lower of cost or market and consist of materials, labor and overhead. Inventory costs are determined using standard costs which approximate actual costs under the first-in, first-out method. Costs include the costs of purchased finished products, sorted wafers, and outsourced assembly, testing and internal overhead. We evaluate inventories for excess quantities and obsolescence. Our evaluation considers market and economic conditions; technology changes, new product introductions, and changes in strategic business direction; and requires estimates that may include elements that are uncertain. In order to state the inventory at lower of cost or market, we maintain reserves against individual stocking units. Inventory write-downs, once established, are not reversed until the related inventories have been sold or scrapped. If future demand or market conditions are less favorable than our projections, a write-down of inventory may be required, and would be reflected in cost of product revenues sold in the period the revision is made. | |
Property, Plant and Equipment | |
Property, plant and equipment are carried at cost less depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the assets’ remaining estimated useful lives, ranging from two to five years for machinery and equipment, including product tooling; and the shorter of lease terms or estimated useful lives for leasehold improvements. When property, plant and equipment is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts. Gains and losses from retirements and asset disposals are recorded in selling, general and administrative (“SG&A”) expenses. | |
We evaluate the recoverability of property, plant and equipment in accordance with ASC Topic 360, Property, Plant, and Equipment. We perform periodic reviews to determine whether facts and circumstances exist that would indicate that the carrying amounts of property, plant and equipment exceeds their fair values. If facts and circumstances indicate that the carrying amount of property, plant and equipment might not be fully recoverable, projected undiscounted net cash flows associated with the related asset or group of assets over their estimated remaining useful lives are compared against their respective carrying amounts. In the event that the projected undiscounted cash flows are not sufficient to recover the carrying value of the assets, the assets are written down to their estimated fair values. All long-lived assets to be disposed of are reported at the lower of carrying amount or fair market value, less expected selling costs. | |
Intangible Assets | |
Our intangible assets consist primarily of technology licensing agreements with third-parties and are carried at cost less amortization. We account for intangible assets in accordance with ASC Topic 350, Intangibles - Goodwill and Other. We evaluate our finite-lived assets for impairment whenever events or changes in circumstances indicate the carrying value of an intangible asset or asset group may not be recoverable. The carrying value of an intangible asset or asset group is not recoverable if the amounts of undiscounted future cash flows the assets are expected to generate (including any net proceeds expected from the disposal of the asset) are less than its carrying value. When we identify that impairment has occurred, we reduce the carrying value of the asset to its comparable market value (if available and appropriate) or to its estimated fair value based on a discounted cash flow approach. Currently, we do not have goodwill or indefinite-lived intangible assets. | |
Fair Value | |
ASC Topic 820, Fair Value Measurements (“ASC 820”), establishes a framework for measuring fair value and requires disclosures about fair value measurement. ASC 820 emphasizes that a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820 established the following fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) the reporting entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs): | |
Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets; | |
Level 2: Other inputs observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborate inputs; and | |
Level 3: Unobservable inputs for which there is little or no market data and which requires the owner of the assets or liabilities to develop its own assumptions about how market participants would price these assets or liabilities. | |
Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy. | |
Financial Instruments | |
ASC Topic 825, Financial Instruments, defines the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. Our financial instruments include cash, accounts receivable, accounts payable, and accrued expenses. These financial instruments are stated at their carrying values, which are estimates of their fair values because of their nearness to cash settlement or the comparability of their terms to the terms we could obtain, for similar instruments, in the current market. Our debt instruments are included in current portion of debt, net, long-term debt, net, and convertible subordinated debt, net on our consolidated balance sheets. | |
Senior Term A Loan | |
At its inception, the fair value of our senior term A loan (the “Term A Loan”) was computed using a cash flow analysis in which the periodic cash coupon payments and the principal payment at maturity were discounted to the valuation date using an appropriate market discount rate. The discount rate was determined by analyzing the seniority and securitization of the instrument, our financial condition, and observing the quoted bond yields in the fixed income market as of the valuation date. The valuation was determined using Level 3 inputs. | |
Senior Term B Loan | |
At its inception, the fair value of our senior term B loan (“the Term B Loan”) was computed using a binomial-lattice model. The valuation was determined using Level 3 inputs. The valuation model combined expected cash outflows with market-based assumptions regarding risk-adjusted yields, stock price volatility, recent price quotes and trading information of our common stock into which the Term B Loan is convertible. | |
Convertible Subordinated Debt | |
The 2014 Debentures required bifurcation and accounting at fair value because the economic and contractual characteristics of the compound embedded derivative met the criteria for bifurcation and separate accounting due to the conversion price not being indexed to our own stock. The compound embedded derivative was comprised of the conversion option and a make-whole payment for foregone interest if the holder converted the debenture early. The make-whole payment for foregone interest expired October 30, 2012, and upon its expiration, the compound embedded derivative no longer met the criteria for bifurcation as all components of the conversion feature were indexed to our own common stock. | |
At its inception, the approximate fair value of the compound embedded derivative included in our 2014 Debentures was computed as the difference between the estimated value of the 2014 Debentures with and without the compound embedded derivative features. The fair value of the 2014 Debentures was estimated using a convertible bond valuation model within a binomial-lattice framework. These valuations were determined using Level 3 inputs. The valuation model combines expected cash outflows with market-based assumptions regarding risk-adjusted yields, stock price volatility, recent price quotes, and trading information of our common stock into which the 2014 Debentures are convertible. Significant increases (decreases) in any of those inputs in isolation would result in a significantly lower (higher) fair value measurement. | |
The compound embedded derivative was presented on the balance sheet at fair value and was marked-to-market, until the make-whole payment for foregone interest expired on October 30, 2012. The change in the fair value of the compound embedded derivative was a non-cash item primarily related to the change in price of the underlying common stock and is reflected in earnings. | |
The valuation methodologies we use as described above require considerable judgment and may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, although we believe our valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. | |
Warranty | |
We establish reserves for future product warranty costs that are expected to be incurred pursuant to specific warranty provisions with our customers. We generally warrant our products against defects for one year from date of shipment, with certain exceptions in which the warranty period can extend to more than one year based on contractual agreements. A warranty reserve is recorded against revenues when products are shipped. At each reporting period, we adjust our reserve for warranty claims based on our actual warranty claims experience as a percentage of net revenues for the preceding 12 months and also consider the effect of known operational issues that may have an impact that differs from historical trends. Historically, our warranty returns have not been material. | |
Contingencies | |
We assess our exposure to loss contingencies, including environmental, legal and income tax matters, and provide an accrual for exposure if it is judged to be probable and reasonably estimable. If the actual loss from a loss contingency differs from management’s estimates, results of operations could be adjusted upward or downward. | |
Recent Accounting Pronouncements | |
In July 2013, the FASB issued ASU 2013-11, Income Taxes (Topic 740): Presentation of Unrecognized Tax Benefit When a Net Operating Loss Carryforward, A Similar Tax Loss, or a Tax Credit Carryforward Exists (A Consensus the FASB Emerging Issues Task Force). ASU 2013-11 provides guidance on financial statement presentation of unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The FASB’s objective in issuing this ASU is to eliminate diversity in practice resulting from a lack of guidance on this topic in current GAAP. This ASU applies to all entities with unrecognized tax benefits that also have tax loss or tax credit carryforwards in the same tax jurisdiction as of the reporting date. This amendment is effective for public entities for fiscal years beginning after December 15, 2013, and interim periods within those years. We do not expect the adoption of this standard to have a material impact on our unaudited consolidated financial position and results of operations. | |
In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers, which supersedes nearly all existing revenue recognition guidance under GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP. The standard is effective for annual periods beginning after December 15, 2016, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). We are currently evaluating the impact of our pending adoption of ASU 2014-09 on our consolidated financial statements and have not yet determined the method by which we will adopt the standard in fiscal year 2018. | |
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements-Going Concern (Subtopic 205-40), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This standard sets forth management’s responsibility to evaluate, each reporting period, whether there is substantial doubt about our ability to continue as a going concern, and if so, to provide related footnote disclosures. The standard is effective for annual reporting periods ending after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016. We are currently evaluating this new standard and after adoption, we will incorporate this guidance in our assessment of going concern. |
COMPUTATION_OF_NET_LOSS_PER_SH
COMPUTATION OF NET LOSS PER SHARE | 12 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
COMPUTATION OF NET LOSS PER SHARE | ' | ||||||||
COMPUTATION OF NET LOSS PER SHARE | |||||||||
For fiscal years 2014, 2013 and 2012, we recorded a net loss. As such, all outstanding potential common shares were excluded from the diluted earnings per share computation. | |||||||||
The following potentially dilutive common shares are excluded from the computation of net loss per share. | |||||||||
Outstanding as of September 30, | |||||||||
2014 | 2013 | 2012 | |||||||
(in thousands) | |||||||||
Outstanding stock options | 2,940 | 2,089 | 1,813 | ||||||
Outstanding restricted stock units | 2,328 | 2,021 | 1,686 | ||||||
Employee Stock Purchase Plan shares | 491 | 368 | 506 | ||||||
Convertible preferred stock | — | — | 674 | ||||||
2014 Debentures | 7,298 | 10,332 | 10,332 | ||||||
Term B Loan | 1,887 | 1,887 | 1,887 | ||||||
Total potential common shares excluded from calculation | 14,944 | 16,697 | 16,898 | ||||||
DETAILS_OF_CERTAIN_FINANCIAL_S
DETAILS OF CERTAIN FINANCIAL STATEMENT COMPONENTS | 12 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Balance Sheet Related Disclosures [Abstract] | ' | |||||||
DETAILS OF CERTAIN FINANCIAL STATEMENT COMPONENTS | ' | |||||||
DETAILS OF CERTAIN FINANCIAL STATEMENT COMPONENTS | ||||||||
The following tables provide details of selected balance sheet items: | ||||||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Inventories: | ||||||||
Raw materials | $ | 1,840 | $ | 1,220 | ||||
Work-in-process | 4,503 | 3,652 | ||||||
Finished goods | 6,449 | 5,820 | ||||||
$ | 12,792 | $ | 10,692 | |||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Property, Plant and Equipment, Net: | ||||||||
Machinery and equipment | $ | 61,236 | $ | 77,865 | ||||
Furniture and fixtures | 505 | 704 | ||||||
Computer equipment | 7,356 | 8,736 | ||||||
Leasehold improvements | 1,829 | 3,163 | ||||||
Construction in progress | 44 | 305 | ||||||
70,970 | 90,773 | |||||||
Less: Accumulated depreciation | (68,112 | ) | (87,666 | ) | ||||
$ | 2,858 | $ | 3,107 | |||||
Depreciation expense totaled $1.7 million, $2.0 million, and $2.6 million for fiscal years 2014, 2013 and 2012, respectively. We retired or otherwise disposed of property, plant and equipment with cost and accumulated depreciation of $21.1 million and $21.0 million, respectively, for fiscal year 2014, and with cost and accumulated depreciation of $3.8 million and $3.7 million for fiscal year 2013. | ||||||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Other Intangible Assets, Net: | ||||||||
Intellectual property and technology license agreements | $ | 5,490 | $ | 4,824 | ||||
Less: Accumulated amortization | (4,014 | ) | (3,654 | ) | ||||
$ | 1,476 | $ | 1,170 | |||||
Intangible assets consisted primarily of technology licensing agreements with third-parties and acquired intellectual property. The weighted average period over which intangible assets acquired in fiscal years 2014 and 2013 are amortized is 6.48 years and 6.85 years, respectively. | ||||||||
The future amortization expense of amortizable intangible assets for the next five fiscal years is (in thousands): $372, $350, $245, $204, $168, and $137 in 2015, 2016, 2017, 2018, 2019 and thereafter, respectively. | ||||||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Other Assets: | ||||||||
Non-current portion of deferred tax asset, net | $ | 1,288 | $ | 1,273 | ||||
Restricted cash | 1,500 | 1,500 | ||||||
Debt issue costs, net | 8 | 287 | ||||||
Other | 308 | 365 | ||||||
$ | 3,104 | $ | 3,425 | |||||
Restricted cash consists of interest bearing certificates of deposit with a domestic bank collateralizing letters of credit and other commitments. | ||||||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Accrued Expenses and Other Current Liabilities: | ||||||||
Accrued software license agreements | $ | 3,335 | $ | 3,526 | ||||
Accrued vacation | 2,580 | 2,442 | ||||||
Accrued wages and benefits | 2,730 | 1,729 | ||||||
Interest payable | 1,645 | 2,196 | ||||||
Accrued income taxes | 408 | 332 | ||||||
Accrued warranty liability | 52 | 60 | ||||||
Accrued other | 1,722 | 1,960 | ||||||
$ | 12,472 | $ | 12,245 | |||||
DEBT
DEBT | 12 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||
DEBT | ' | |||||||||||
DEBT | ||||||||||||
September 30, | ||||||||||||
2014 | 2013 | |||||||||||
(in thousands) | ||||||||||||
Term A Loan, bearing interest at 9.0% and 10.5% as of September 30, 2014 and 2013, respectively, due August 2016 | $ | 7,791 | $ | 7,919 | ||||||||
Term B Loan, convertible until October 31, 2014, bearing interest at 9.0% and 8.0% as of September 30, 2014 and 2013, respectively, due August 2016 | 8,626 | 8,444 | ||||||||||
Other | — | 3 | ||||||||||
Long-term debt, net | 16,417 | 16,366 | ||||||||||
2014 Debentures, convertible, 8.0% fixed-rate notes, due October 2014 | 32,727 | 44,384 | ||||||||||
Total debt, net | $ | 49,144 | $ | 60,750 | ||||||||
Additional information about our debt is as follows: | ||||||||||||
Term A Loan | Term B Loan | 2014 Debentures | ||||||||||
(in thousands) | ||||||||||||
Principal | $ | 7,857 | $ | 9,342 | $ | 32,843 | ||||||
Unamortized debt discount | (66 | ) | (716 | ) | (116 | ) | ||||||
Carrying value | $ | 7,791 | $ | 8,626 | $ | 32,727 | ||||||
Interest payable terms | Quarterly, in arrears | Quarterly, in arrears | Semi-annually, in arrears | |||||||||
Annual effective interest rate | 9.5 | % | 13.5 | % | 12.2 | % | ||||||
Conversion price per common share | n/a | $ | 4.95 | $ | 4.5 | |||||||
Our long-term debt is comprised of our Term A Loan and our Term B Loan, which we collectively refer to as our “Term A and B Loans”. On November 5, 2013 we amended the credit agreements for the Term A and B Loans (the “Amendment”). The Amendment extends the maturity dates of our Term A and B Loans to August 31, 2016, and also provides that the Term A and B Loans each bear interest in cash at 9.0% per annum payable quarterly in arrears. In addition, the Amendment provides us with greater flexibility to sell assets and use the resulting proceeds for purposes other than repaying the Term A and B Loans after repayment of our 2014 Debentures. | ||||||||||||
Upon the occurrence of certain change in control events, the holders of the Term A and B Loans may require us to redeem all or a portion of the loans at 100% of the principal amount plus accrued and unpaid interest. | ||||||||||||
We have the right to optionally prepay the Term A and B Loans in whole or in part, at any time and from time to time, subject to the payment of a prepayment fee. The prepayment fee is 3% for prepayments made on or after October 30, 2014 but prior to October 30, 2015, and 2% for prepayment made on or after October 30, 2015. We are required to maintain an unrestricted cash balance of $8.0 million and achieve minimum quarterly revenues of $10.0 million. The Term A and B Loans are collateralized by substantially all of our assets. | ||||||||||||
The credit agreement for the Term A and B Loans provided the lenders with the right to convert the Term B Loan into shares of our common stock at a conversion price of $4.95 per share through October 30, 2014. At September 30, 2014, conversion of the outstanding principal amount of the Term B Loan would have resulted in the issuance of 1.9 million shares of common stock. On October 31, 2014, the conversion right expired unexercised. | ||||||||||||
In connection with Amendment, we paid the lenders a consent fee of $0.3 million and we repurchased $13.7 million principal amount of our 2014 Debentures at 107% of the principal amount thereof plus accrued interest. We recorded a loss on extinguishment of debt of $1.6 million due to the repurchase. After this transaction, $32.8 million principal amount of 2014 Debentures remained outstanding. | ||||||||||||
As of September 30, 2014, our current debt consisted of our 2014 Debentures. During fiscal year 2014, cash of $0.7 million was restricted for payment of the 2014 Debentures under the terms of the indenture following the sale of assets. At September 30, 2014, conversion of the outstanding principal amount of the 2014 Debentures would have resulted in the issuance of 7.3 million shares of common stock. We repaid the outstanding principal of $32.8 million of our 2014 Debentures, plus accrued interest, on October 30, 2014, the maturity date of the debentures. | ||||||||||||
The compound embedded derivative related to the 2014 Debentures, which expired October 30, 2012, was comprised of the conversion option and a make-whole payment for foregone interest if the holder converted the debenture early. Upon expiration of the make-whole payment for forgone interest, the compound embedded derivative no longer met the criteria for bifurcation as all components of the conversion feature were indexed to our own stock. A final valuation was completed on October 30, 2012. We recorded a gain of $0.8 million into earnings due to the change in value and reclassified the final liability value of $2.1 million, from other long-term liabilities, to equity. | ||||||||||||
The credit agreement for the Term A and B Loans provide for customary restrictions and limitations on our ability to incur indebtedness and liens on property, make restricted payments or investments, enter into mergers or consolidations, conduct asset sales, pay dividends or distributions and enter into specified transactions and activities, and also contain other customary default provisions. We were in compliance with all covenants as of September 30, 2014. | ||||||||||||
Debt Maturities | ||||||||||||
Principal maturity of our total aggregated outstanding debt is as follows: | ||||||||||||
Fiscal year | (in thousands) | |||||||||||
2015 | $ | 32,843 | ||||||||||
2016 | 17,199 | |||||||||||
Total | $ | 50,042 | ||||||||||
Except for required repurchases upon a change in control or in the event of certain asset sales, as described in the applicable credit agreements, we are not required to make any sinking fund or redemption payments with respect to this debt. |
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||||
FAIR VALUE MEASUREMENTS | ||||||||||||||||
We measure the fair value of our Term A and B Loans and 2014 Debentures, which are carried at amortized cost, on a quarterly basis for disclosure purposes. We use a binomial-lattice model to estimate fair values of these financial instruments. The key unobservable input utilized in the model for our Term B Loan and 2014 Debentures includes a discount rate of 4.0% and 3.3%, respectively. The estimated fair value of our Term A Loan is determined using Level 3 inputs based primarily on the comparability of its terms to the terms we could obtain, for similar instruments, in the current market. | ||||||||||||||||
The estimated fair values of our financial instruments are as follows: | ||||||||||||||||
September 30, | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Carrying value | Fair value | Carrying value | Fair value | |||||||||||||
(in thousands) | ||||||||||||||||
Term A Loan | $ | 7,791 | $ | 8,755 | $ | 7,919 | $ | 8,165 | ||||||||
Term B Loan | 8,626 | 10,245 | 8,444 | 9,781 | ||||||||||||
2014 Debentures | 32,727 | 33,040 | 44,384 | 49,282 | ||||||||||||
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Sep. 30, 2014 | |
Equity [Abstract] | ' |
Stockholders' Equity | ' |
STOCKHOLDERS’ EQUITY | |
Authorized Capital Stock | |
We are authorized to issue up to 250 million shares of common stock, par value $0.01, per share, of which 9.2 million shares are reserved for future potential issuance upon conversion of debt, 8.4 million shares of common stock have been reserved for issuance under our stock compensation plans, and 3.0 million remaining shares of common stock are reserved for issuance under our ESPP. | |
We are authorized to issue up to 10 million shares of preferred stock, with a par value of $0.01 per share, none of which are outstanding. | |
In December 2012, we raised $17.1 million, net of offering costs of $1.6 million, from the registered public sale of 10,651,280 shares of common stock at $1.75 per share, which was a discount to the market price of our common stock. | |
In June 2013, we raised an additional $37.4 million, net of offering expenses of $2.8 million, from the registered public sale of 18,720,000 shares of common stock at $2.15 per share, which was a discount to the market price of our common stock. | |
In June 2014, we raised $26.6 million, net of offering expenses of $2.1 million, from the registered public sale of 8,582,076 shares of common stock at $3.35 per share. |
STOCK_BASED_COMPENSATION
STOCK BASED COMPENSATION | 12 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||
STOCK BASED COMPENSATION | ' | ||||||||||||||||
STOCK BASED COMPENSATION | |||||||||||||||||
Stock Options | |||||||||||||||||
We have in effect one stock incentive plan, the 2013 Incentive Plan (the “Plan”) under which non-qualified stock options and restricted stock units have been granted to employees and non-employee directors. Options generally expire 10 years from the date of grant. | |||||||||||||||||
The Compensation Committee of the Board of Directors determines the stock-based compensation grants. The exercise price of options is the closing price on the date the options are granted. The fair value of each option grant is estimated on the date of the grant using the Black-Scholes option-pricing model. | |||||||||||||||||
Under the Plan, we have 1.9 million shares available for future grant as of September 30, 2014. The Plan permits the grant of stock options, stock appreciation rights, stock awards, performance awards, restricted stock and stock units, and other stock and cash-based awards. The Plan uses a “fungible share” concept, pursuant to which shares that are subject to appreciation awards (such as stock options and stock appreciation rights) are counted against the Plan share limit on a 1-for-1 basis for every such share subject to appreciation awards, and shares that are subject to full value awards (such as awards of stock, restricted stock and restricted stock units) are counted against the Plan share limit at a ratio of 1.5 shares for every share subject to the full value award. | |||||||||||||||||
As of September 30, 2014, none of our stock-based awards are classified as liabilities. We did not capitalize any stock-based compensation cost. | |||||||||||||||||
Compensation cost related to our Plan and ESPP is as follows: | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
(in thousands) | |||||||||||||||||
Cost of revenues | $ | 823 | $ | 617 | $ | 567 | |||||||||||
Engineering, research and development | 2,248 | 1,616 | 1,530 | ||||||||||||||
Selling, general and administrative | 3,004 | 2,163 | 2,345 | ||||||||||||||
Total stock-based compensation expense | $ | 6,075 | $ | 4,396 | $ | 4,442 | |||||||||||
As of September 30, 2014, there was $6.0 million of unrecognized stock-based compensation expense related to non-vested stock options, restricted stock units, and our ESPP. The weighted average period over which the unearned stock-based compensation for stock options and restricted stock units is expected to be recognized is approximately 1.2 years and 1.6 years, respectively. An estimated forfeiture rate of 4.2% has been applied to all unvested options and restricted stock outstanding as of September 30, 2014. On a quarterly basis, we assess changes to our estimate of expected equity award forfeitures based on our review of recent forfeiture activity and expected future employee attrition. We recognize the effect of adjustments made to the forfeiture rates, if any, in the period that we change the forfeiture estimate. The effect of forfeiture adjustments in fiscal years 2014, 2013, and 2012 was not significant. Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that we grant additional equity awards and our stock price increases. | |||||||||||||||||
Activity in stock option awards is as follows: | |||||||||||||||||
Shares (in thousands) | Weighted average | Weighted average | Aggregate | ||||||||||||||
exercise price | remaining | intrinsic value (in thousands) | |||||||||||||||
contractual life (in years) | |||||||||||||||||
Options outstanding, September 30, 2011 | 1,699 | $ | 29.77 | 6.37 | $ | — | |||||||||||
Granted | 401 | 2.55 | |||||||||||||||
Exercised | (6 | ) | 2.54 | 3 | |||||||||||||
Cancelled or expired | (281 | ) | 76.87 | ||||||||||||||
Options outstanding, September 30, 2012 | 1,813 | 16.57 | 6.61 | 2 | |||||||||||||
Granted | 464 | 2.12 | |||||||||||||||
Exercised | (9 | ) | 2.24 | 6 | |||||||||||||
Cancelled or expired | (179 | ) | 16.52 | ||||||||||||||
Options outstanding, September 30, 2013 | 2,089 | 13.43 | 6.67 | 591 | |||||||||||||
Granted | 1,014 | 2.53 | |||||||||||||||
Exercised | (52 | ) | 2.36 | 64 | |||||||||||||
Cancelled or expired | (111 | ) | 76.55 | ||||||||||||||
Options outstanding, September 30, 2014 | 2,940 | $ | 7.46 | 7 | $ | 2,059 | |||||||||||
Options exercisable, September 30, 2014 | 1,633 | $ | 11.36 | 5.63 | $ | 668 | |||||||||||
This intrinsic value represents the excess of the fair market value of our common stock on the date of exercise over the exercise price of such options. The aggregate intrinsic values in the preceding table for the options outstanding represent the total pretax intrinsic value, based on our closing stock price of $3.60, $3.04, and $2.44 as of September 30, 2014, 2013 and 2012, respectively, which would have been received by the option holders had those option holders exercised their in-the-money options as of those dates. There were 0.6 million in-the-money stock options that were exercisable as of September 30, 2014. | |||||||||||||||||
The fair value of stock‑based awards is estimated at the date of grant using the Black‑Scholes option valuation model; however, the value calculated using an option pricing model may not be indicative of the fair value observed in a willing buyer/willing seller market transaction, or actually realized by the employee upon exercise. Expected volatility used to estimate the fair value of options granted is based on the historical volatility of our common stock. The risk-free interest rate is based on the United States Treasury constant maturity rate for the expected life of the stock option. The expected life of a stock award is the period of time that the award is expected to be outstanding. Expected lives are estimated in accordance with SAB No. 107, as amended by SAB No. 110, which provides supplemental application guidance based on the views of the SEC. | |||||||||||||||||
The per share fair values of stock options granted in connection with stock incentive plans have been estimated using the following weighted average assumptions: | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Expected life (in years) | 5.79 | 5.66 | 6.61 | ||||||||||||||
Expected volatility: | |||||||||||||||||
Weighted-average | 81.50% | 82.00% | 86.90% | ||||||||||||||
Range | 79.5% - 81.6% | 79.8% - 82.1% | 82.2% - 87.1% | ||||||||||||||
Expected dividend | — | — | — | ||||||||||||||
Risk-free interest rate | 1.7% - 1.9% | 0.9% - 1.7% | 1.0% - 1.3% | ||||||||||||||
The weighted average fair value at the date of grant of options granted in fiscal years 2014, 2013 and 2012 was $1.75, $1.44 and $1.80, respectively. | |||||||||||||||||
On December 10, 2013, we granted 500,000 market-based stock options at an exercise price of $2.53 to executive officers. The market-based options vest if either of the following conditions is met prior to December 10, 2018: (i) the closing price of our common stock equals or exceeds twice the exercise price of $2.53 for 30 consecutive trading days; or (ii) a change in control occurs where the Company’s stockholders receive in consideration of their shares of common stock cash or other consideration with a value at least equal to twice the exercise price of $2.53. We evaluate stock awards with market conditions as to the probability that the market conditions will be met and estimate the date at which the market conditions will be met in order to properly recognize stock-based compensation expense over the requisite service period. We used the following assumptions to estimate the fair value of the options: expected life of 1.3 years, expected volatility of 80.0%, a zero dividend rate, and a risk-free rate of 2.79%. The market-based options had a grant date per share fair value of $1.86. | |||||||||||||||||
The following table provides additional information in regards to options outstanding as of September 30, 2014: | |||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||
Range of Exercise Price | Number Outstanding (in thousands) | Weighted Average Remaining Contractual Life (Years) | Weighted Average Exercise Price | Number Exercisable (in thousands) | Weighted Average Exercise Price | ||||||||||||
$2.10 - $2.26 | 424 | 8.43 | $ | 2.11 | 194 | $ | 2.1 | ||||||||||
2.53 | 987 | 9.19 | 2.53 | 116 | 2.53 | ||||||||||||
2.54 - 4.36 | 743 | 6.74 | 3.45 | 542 | 3.49 | ||||||||||||
4.60 - 47.20 | 589 | 4.83 | 7.84 | 583 | 7.87 | ||||||||||||
48.00 - 145.40 | 197 | 0.43 | 57.56 | 198 | 57.56 | ||||||||||||
$2.10 - $145.40 | 2,940 | 7 | $ | 7.46 | 1,633 | $ | 11.36 | ||||||||||
Restricted Stock Units | |||||||||||||||||
We grant restricted stock units to certain employees and to our non-employee directors. Grants vest over varying terms, to a maximum of four years from the date of the grant. Awards to non-employee directors upon their initial appointment or election to the board vest in installments of 33.3% each over the first three anniversaries of the grant date, and annual awards to non-employee directors vest 100% on the first anniversary of the grant date. Unvested restricted shares are forfeited if the recipient’s employment or board term terminates for any reason other than death, disability, or special circumstances as determined by the Compensation Committee of the Board of Directors. | |||||||||||||||||
Activity for our restricted stock award units is as follows: | |||||||||||||||||
Restricted | Weighted Average | Weighted average | Aggregate | ||||||||||||||
Stock Units (in thousands) | Grant-Date Fair | remaining | intrinsic value (in thousands) | ||||||||||||||
Value per Share | contractual life (in years) | ||||||||||||||||
Restricted stock units, September 30, 2011 | 1,296 | $ | 4.66 | 1.38 | $ | 3,823 | |||||||||||
Awarded | 1,258 | 2.57 | |||||||||||||||
Released | (721 | ) | 3.99 | ||||||||||||||
Forfeited | (147 | ) | 3.48 | ||||||||||||||
Restricted stock units, September 30, 2012 | 1,686 | 3.49 | 1.09 | 4,113 | |||||||||||||
Awarded | 1,527 | 2.12 | |||||||||||||||
Released | (1,045 | ) | 3.19 | ||||||||||||||
Forfeited | (147 | ) | 2.88 | ||||||||||||||
Restricted stock units, September 30, 2013 | 2,021 | 2.65 | 1.13 | 6,143 | |||||||||||||
Awarded | 1,600 | 2.62 | |||||||||||||||
Released | (1,183 | ) | 2.69 | ||||||||||||||
Forfeited | (110 | ) | 2.6 | ||||||||||||||
Restricted stock units, September 30, 2014 | 2,328 | $ | 2.61 | 0.96 | $ | 8,380 | |||||||||||
The aggregate intrinsic values in the preceding table for the restricted stock units outstanding represent the total pretax intrinsic value, based on our closing stock price of $3.60, $3.04, and $2.44 as of September 30, 2014, 2013 and 2012, respectively. We issue restricted stock units as part of our equity incentive plans. For the years ended September 30, 2014, 2013, and 2012, the total grant date fair value of shares vested from restricted stock unit grants was $3.2 million, $3.3 million and $2.9 million, respectively. For the majority of restricted stock units granted, the number of shares issued on the date the restricted stock units vest is net of the minimum statutory withholding requirements that we pay in cash to the appropriate taxing authorities on behalf of our employees. The impact of such withholding totaled $1.3 million, $0.6 million and $0.6 million for each of the years ended September 30, 2014, 2013, and 2012, respectively, and was recorded as settlement on restricted stock tax withholding in the accompanying consolidated statements of stockholders’ equity (deficit). Although shares withheld are not issued, they are treated as common stock repurchases in our consolidated financial statements, as they reduce the number of shares that would have been issued upon vesting. | |||||||||||||||||
Employee Stock Purchase Plan | |||||||||||||||||
Pursuant to our ESPP, eligible employees may authorize payroll deductions of up to 15% of their regular base salary subject to certain limits to purchase shares at the lower of 85% of the fair market value of the common stock on the date of the commencement of the offering or on the last day of the 6-month offering period. During fiscal years 2014, 2013 and 2012, a total of 721,900, 952,516 and 821,470 shares, respectively, were purchased by and distributed to employees at a weighted average price of $2.50, $1.75 and $2.11 per share, respectively. At fiscal 2014 year-end, we had 3.0 million shares of our common stock reserved for future issuance under the plan. We recognized $0.6 million, $0.6 million and $0.6 million stock compensation expense under the ESPP during the fiscal years ended September 30, 2014, 2013 and 2012, respectively. We determine the fair value of the ESPP awards using the Black-Scholes pricing model. Underlying assumptions used were as follows: | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Expected life (in years) | 0.5 | 0.5 | 0.5 | ||||||||||||||
Expected volatility (range) | 37.1% - 50.3% | 47.6% - 49.8% | 40.4% - 48.4% | ||||||||||||||
Expected dividend | — | — | — | ||||||||||||||
Risk-free interest rate | 0.07% - .08% | 0.11% - .14% | 0.09% - .20% |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||||||||||
INCOME TAXES | ' | ||||||||||||||||||||
INCOME TAXES | |||||||||||||||||||||
The components of loss before income tax expense (benefit) for the years ended September 30, 2014, 2013 and 2012 were as follows: | |||||||||||||||||||||
September 30, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||||
(Loss) income before income taxes: | |||||||||||||||||||||
Domestic | $ | (18,871 | ) | $ | (23,646 | ) | $ | (3,406 | ) | ||||||||||||
Foreign | 1,137 | 1,020 | 2,120 | ||||||||||||||||||
$ | (17,734 | ) | $ | (22,626 | ) | $ | (1,286 | ) | |||||||||||||
Income tax expense (benefit) consists of the following for the years ended September 30, 2014, 2013 and 2012: | |||||||||||||||||||||
September 30, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Income tax expense (benefit): | |||||||||||||||||||||
Current: | |||||||||||||||||||||
Federal | $ | (27 | ) | $ | — | $ | (188 | ) | |||||||||||||
State | 71 | 54 | 41 | ||||||||||||||||||
Foreign | 312 | (758 | ) | 1,510 | |||||||||||||||||
Total current | 356 | (704 | ) | 1,363 | |||||||||||||||||
Deferred: | |||||||||||||||||||||
Federal | — | — | — | ||||||||||||||||||
State | — | — | — | ||||||||||||||||||
Foreign | (15 | ) | 156 | (1,537 | ) | ||||||||||||||||
Total deferred | (15 | ) | 156 | (1,537 | ) | ||||||||||||||||
Total income tax expense (benefit): | $ | 341 | $ | (548 | ) | $ | (174 | ) | |||||||||||||
A reconciliation of the income tax expense (benefit) by applying the statutory United States federal income tax rate to loss before income tax expense (benefit) is as follows: | |||||||||||||||||||||
September 30, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
$ | % | $ | % | $ | % | ||||||||||||||||
(in thousands, except for percentages) | |||||||||||||||||||||
Federal income tax benefit at statutory rate | $ | (6,030 | ) | 34 | % | $ | (7,693 | ) | 34 | % | $ | (437 | ) | 34 | % | ||||||
State tax benefit net of federal benefit | (242 | ) | 1.4 | % | (536 | ) | 2.4 | % | (13 | ) | 1 | % | |||||||||
Foreign taxes | (68 | ) | 0.4 | % | (1,156 | ) | 5.1 | % | 1,102 | (85.7 | )% | ||||||||||
Tax credits | — | — | % | (438 | ) | 1.9 | % | (1,230 | ) | 95.6 | % | ||||||||||
Nondeductible expenses | 650 | (3.7 | )% | 771 | (3.4 | )% | 1,015 | (78.9 | )% | ||||||||||||
Other | — | — | % | 87 | (0.4 | )% | (100 | ) | 7.9 | % | |||||||||||
Change in valuation allowance | 6,131 | (34.6 | )% | 7,164 | (31.7 | )% | (1,147 | ) | 89.2 | % | |||||||||||
Rate change/other adjustments on deferred taxes | (100 | ) | 0.6 | % | 1,253 | (5.5 | )% | 636 | (49.5 | )% | |||||||||||
Income tax expense (benefit) | $ | 341 | (1.9 | )% | $ | (548 | ) | 2.4 | % | $ | (174 | ) | 13.6 | % | |||||||
Our effective tax rate was (1.9)% for the fiscal year ended September 30, 2014 compared to 2.4% and 13.6% for the comparable periods in the prior years. Our income tax expense (benefit) is primarily impacted by foreign taxes, certain nondeductible interest and share based expenses. The income tax expense (benefit) is also impacted by the release of a portion of the valuation allowances related to certain foreign jurisdictions’ deferred tax assets as such balances were more likely than not realizable within the applicable carryforward period based on our analysis of the available positive and negative evidence. | |||||||||||||||||||||
Deferred tax assets and liabilities are recognized for future tax consequences between the carrying amounts of assets and liabilities and their respective tax basis using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Significant deferred tax assets and liabilities, consist of the following: | |||||||||||||||||||||
September 30, | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Deferred Tax Assets: | |||||||||||||||||||||
Net operating loss carryforward | $ | 31,418 | $ | 27,110 | |||||||||||||||||
Research and development tax credits | 10,165 | 10,574 | |||||||||||||||||||
Deferred income | 2,724 | 2,664 | |||||||||||||||||||
Stock based compensation(1) | 3,354 | 12,313 | |||||||||||||||||||
Fixed assets and intangible property | 7,293 | 7,955 | |||||||||||||||||||
Inventories | 1,714 | 2,256 | |||||||||||||||||||
Allowances and reserves | 9,436 | 9,277 | |||||||||||||||||||
Foreign tax credit/AMT credit | 88 | 88 | |||||||||||||||||||
Other | 3 | 11 | |||||||||||||||||||
Total deferred tax assets | 66,195 | 72,248 | |||||||||||||||||||
Deferred Tax Liabilities: | |||||||||||||||||||||
Debt amortization | (11 | ) | (2,065 | ) | |||||||||||||||||
Total deferred tax liabilities | (11 | ) | (2,065 | ) | |||||||||||||||||
Net deferred income taxes | 66,184 | 70,183 | |||||||||||||||||||
Valuation allowance(1) | (64,788 | ) | (68,802 | ) | |||||||||||||||||
Net deferred tax assets | $ | 1,396 | $ | 1,381 | |||||||||||||||||
-1 | The Company identified an overstatement of its previously disclosed deferred tax asset for stock based compensation and the related valuation allowance in the amount of $9.1 million as of September 30, 2013. The Company evaluated the impact of this error in accordance with SAB No. 99 and concluded that it was not material. Further, the Company maintains a full valuation allowance on all of its U.S. and state deferred tax assets, and there was no impact on the Company's financial position and results of operations. As of September 30, 2014 the Company recorded an adjustment of $9.1 million to decrease both the deferred tax asset for stock based compensation and the related valuation allowance. The previously reported amounts have not been revised. | ||||||||||||||||||||
At September 30, 2014, we had approximately $53.9 million, $27.3 million, and $119.2 million of federal, state, and foreign Net Operating Losses (“NOLs”) respectively, that can be used in future tax years. We also have available state research and development tax credit carryforwards of approximately $10.2 million. The federal NOLs and tax credits may be carried forward through 2034; state NOLs may be carried forward through 2034; state tax credits may be carried forward indefinitely; and foreign NOLs have various carryforward provisions in several jurisdictions. | |||||||||||||||||||||
In December 2012, we issued 10.7 million shares of common stock in a public offering which resulted in a Section 382 ownership change. In general, a Section 382 ownership change occurs if there is a cumulative change in our ownership by “5%” shareholders (as defined in the Internal Revenue Code of 1986, as amended) that exceeds 50 percentage points over a rolling three-year period. An ownership change generally affects the rate at which NOLs and potentially other deferred tax assets are permitted to offset future taxable income. Of our federal NOL amount as of September 30, 2014, $25.4 million is subject to an annual Section 382 limitation of $1.4 million due to the December 2012 ownership change. Since we maintain a full valuation allowance on all of our U.S. and state deferred tax assets, the impact of the ownership change on the future realizability of our U.S. and state deferred tax assets did not result in an impact to our provision for income taxes for the year ended September 30, 2014, or on our net deferred tax asset as of September 30, 2014. | |||||||||||||||||||||
In June 2013, we issued an additional 18.7 million shares of common stock in a public offering. Based on a preliminary evaluation we do not believe this offering caused another Section 382 ownership change. As additional relevant information becomes available we will update our evaluation. If an additional ownership change did occur or does occur in the future, our ability to utilize our NOL carryforwards and other deferred tax assets to offset future taxable income may be further limited and the value and recoverability of our NOLs and other deferred tax assets could be further diminished. | |||||||||||||||||||||
We analyzed our need to maintain the valuation allowance against our otherwise recognizable deferred tax assets in the federal, state, and foreign jurisdictions and have recorded a total valuation allowance of $64.8 million of as September 30, 2014, which represents a decrease of $4.0 million from the prior fiscal year. Because we have historically experienced net tax losses, the benefits of which resulted in recognized deferred tax assets, we have placed a $55.0 million valuation allowance against all of our otherwise recognizable deferred tax assets in the federal and state jurisdictions. Furthermore, we have also placed a $9.8 million valuation allowance against most of our deferred tax assets in our foreign jurisdictions as we have concluded that it is more likely than not that the majority of our foreign deferred tax assets will not be realized. | |||||||||||||||||||||
Accounting guidance prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The total amount of gross unrecognized tax benefits was approximately $10.3 million as of September 30, 2014 and approximately $10.6 million as of September 30, 2013. The total amount of gross unrecognized tax benefits decreased by $0.3 million, the majority of which related to state research and development tax credits that have not been utilized. | |||||||||||||||||||||
As of September 30, 2014, approximately $0.2 million of the $10.3 million unrecognized tax benefits related to our state tax liability is recorded in accrued expenses and other current liabilities on the consolidated balance sheets. The remaining $10.1 million, which relates to research and development tax credits that have not been utilized, is reflected as a reduction to the deferred tax asset arising from the research and development tax credits. As of September 30, 2013, approximately $0.2 million of the $10.6 million unrecognized tax benefits, related to our state tax liability, was recorded in accrued expenses and other current liabilities on the consolidated balance sheets. The remaining $10.4 million related to research and development tax credits that have not been utilized, was reflected as a reduction to the deferred tax asset arising from the research and development tax credits. | |||||||||||||||||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefit is as follows: | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Beginning balance as of September 30: | $ | (10,615 | ) | $ | (10,822 | ) | $ | (10,215 | ) | ||||||||||||
Gross decreases - tax positions in prior period | 290 | 354 | — | ||||||||||||||||||
Gross increases - current-period tax positions | — | (147 | ) | (47 | ) | ||||||||||||||||
Gross increases - tax positions in prior period | — | — | (560 | ) | |||||||||||||||||
Ending balance as of September 30: | $ | (10,325 | ) | $ | (10,615 | ) | $ | (10,822 | ) | ||||||||||||
We recognize accrued interest and penalties related to unrecognized tax benefits within the consolidated statements of operations as income tax expense. As of September 30, 2014, there were no material interest or penalties accrued due to significant net operating losses. | |||||||||||||||||||||
We are subject to taxation in the United States and various state and foreign jurisdictions. The 2010 through 2014 tax years generally remain subject to examination by their respective tax authorities. Effectively, all our tax years in which a tax NOL is carried forward to the present are subject to examination by federal, state and foreign tax authorities. Therefore, we cannot estimate the range of unrecognized tax benefits that may significantly change within the next 12 months. |
SIGNIFICANT_CUSTOMERS_CONCENTR
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION | 12 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||
SIGNIFICANT CUSTOMERS, CONCENTRATIONS OF CREDIT RISK AND GEOGRAPHIC INFORMATION | ' | |||||||||||
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION | ||||||||||||
We manage and operate our business through one operating segment. | ||||||||||||
Net revenues from customers equal to or greater than 10% of total net revenues is as follows: | ||||||||||||
September 30, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Nu Horizons Electronics** | * | * | 13.5 | % | ||||||||
WPG Holdings** | 23.8 | % | 17.7 | % | 10.7 | % | ||||||
__________________________________________________ | ||||||||||||
*Less than 10% of total net revenues for period indicated. | ||||||||||||
**Distributors | ||||||||||||
Net revenues by geographic area are as follows: | ||||||||||||
September 30, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(in thousands) | ||||||||||||
United States | $ | 25,284 | $ | 28,454 | $ | 41,559 | ||||||
China, including Hong Kong | 31,653 | 32,545 | 30,786 | |||||||||
Taiwan | 23,649 | 17,430 | 15,871 | |||||||||
Other Asia Pacific | 14,258 | 11,479 | 15,603 | |||||||||
Europe, Middle East and Africa | 13,653 | 13,865 | 15,664 | |||||||||
Total net revenues | $ | 108,497 | $ | 103,773 | $ | 119,483 | ||||||
Revenues by geographic area are based upon the country of billing. The geographic location of distributors and third-party manufacturing service providers may be different from the geographic location of the ultimate end users. | ||||||||||||
We believe a substantial portion of the products billed to OEM and third-party manufacturing service providers in the Asia Pacific region are ultimately shipped to end-markets in the United States and Europe. | ||||||||||||
We also classify our product revenues based on our three product lines: (i) Ethernet switching, (ii) Connectivity and (iii) Transport processing. Product revenues by product lines are as follows: | ||||||||||||
September 30, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(in thousands) | ||||||||||||
Ethernet switching | $ | 50,914 | $ | 38,675 | $ | 32,607 | ||||||
Connectivity | 41,017 | 42,885 | 52,933 | |||||||||
Transport processing | 10,820 | 19,774 | 24,380 | |||||||||
Product revenues | $ | 102,751 | $ | 101,334 | $ | 109,920 | ||||||
Long-lived assets, which consist of property, plant and equipment, net of accumulated depreciation, are summarized as follows: | ||||||||||||
September 30, | ||||||||||||
2014 | 2013 | |||||||||||
(in thousands) | ||||||||||||
Located within the United States | $ | 1,628 | $ | 1,615 | ||||||||
Located outside the United States | 1,230 | 1,492 | ||||||||||
$ | 2,858 | $ | 3,107 | |||||||||
RETIREMENT_SAVINGS_PLAN
RETIREMENT SAVINGS PLAN | 12 Months Ended |
Sep. 30, 2014 | |
Compensation and Retirement Disclosure [Abstract] | ' |
Retirement Savings Plan | ' |
RETIREMENT SAVINGS PLAN | |
We have a qualified retirement plan under the provisions of Section 401(k) of the Internal Revenue Code covering substantially all U.S. employees. Participants in this plan may defer up to the maximum annual amount allowable under IRS regulations. Employee contributions are fully vested and non-forfeitable at all times. Beginning July 1, 2014, contributions by participants to the plan were matched by us and our matching contributions totaled $0.2 million for fiscal year 2014. Employees vest in matching contributions at 25% per year until they become 100% vested after four years of service. In compliance with governing regulations, we made contributions to the retirement savings plans of employees of our foreign subsidiaries in the amount of $0.9 million for fiscal year 2014, $0.8 million for fiscal year 2013, and $0.7 million for fiscal year 2012. |
COMMITMENTS
COMMITMENTS | 12 Months Ended | |||||||||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||||||||||||||
COMMITMENTS | ' | |||||||||||||||||||||||||||
COMMITMENTS | ||||||||||||||||||||||||||||
Operating Leases and Software Licenses | ||||||||||||||||||||||||||||
We lease facilities under non-cancellable operating leases. The leases expire at various dates through fiscal year 2018 and frequently include renewal provisions for varying periods of time, provisions which require us to pay taxes, insurance, maintenance costs or provisions for minimum rent increases. Minimum lease payments, including scheduled rent increases, are recognized as rent expenses on a straight-line basis over the applicable lease term. Lease incentives received are recognized as a reduction of rental expense on a straight-line basis over the term of the lease. Rent expense, including common area maintenance expense, under operating leases totaled $3.0 million for fiscal year 2014, $3.5 million for fiscal year 2013, and $3.0 million for fiscal year 2012. | ||||||||||||||||||||||||||||
Software license commitments represent non-cancellable licenses of intellectual property from third-parties used in the development of our products. | ||||||||||||||||||||||||||||
Future minimum lease payments under non-cancellable operating leases that have remaining non-cancellable lease terms in excess of one year and software licenses are as follows: | ||||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | Total | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||
Operating leases | $ | 2,002 | $ | 651 | $ | 169 | $ | 60 | $ | — | $ | — | $ | 2,882 | ||||||||||||||
Software licenses | 8,084 | 4,555 | 4,275 | 4,175 | — | — | 21,089 | |||||||||||||||||||||
Total | $ | 10,086 | $ | 5,206 | $ | 4,444 | $ | 4,235 | $ | — | $ | — | $ | 23,971 | ||||||||||||||
CONTINGENCIES | ||||||||||||||||||||||||||||
We are involved in legal proceedings in the ordinary course of business, including actions against us which assert or may assert claims or seek to impose fines and penalties in substantial amounts. Related legal defense costs are expensed as incurred. | ||||||||||||||||||||||||||||
Patents and Technology Licenses | ||||||||||||||||||||||||||||
We have entered into various licensing agreements requiring primarily fixed fee royalty payments. Certain of these agreements contain provisions for the payment of guaranteed or minimum royalty amounts. In the event that we fail to pay any minimum annual royalties, these licenses may automatically be terminated. | ||||||||||||||||||||||||||||
Warranties | ||||||||||||||||||||||||||||
We establish reserves for future product warranty costs that are expected to be incurred pursuant to specific warranty provisions with our customers. We generally warrant our products against defects for one year from date of shipment, with certain exceptions in which the warranty period can extend to more than one year based on contractual agreements. Our warranty reserves are established at the time of sale and updated throughout the warranty period based upon numerous factors including historical warranty return rates and expenses over various warranty periods. Historically, our warranty returns have not been material. | ||||||||||||||||||||||||||||
Intellectual Property Indemnities | ||||||||||||||||||||||||||||
We indemnify certain customers and our contract manufacturers against liability arising from third-party claims of intellectual property rights infringement related to our products. These indemnities appear in development and supply agreements with our customers as well as manufacturing service agreements with our contract manufacturers, are not limited in amount or duration and generally survive the expiration of the contract. Given that the amount of any potential liabilities related to such indemnities cannot be determined until an infringement claim has been made, we are unable to determine the maximum amount of losses that we could incur related to such indemnifications. | ||||||||||||||||||||||||||||
Director and Officer Indemnities and Contractual Guarantees | ||||||||||||||||||||||||||||
We have entered into indemnification agreements with our directors and executive officers, which require us to indemnify such individuals to the fullest extent permitted by Delaware law. Our indemnification obligations under such agreements are not limited in amount or duration. Certain costs incurred in connection with such indemnifications may be recovered under certain circumstances under various insurance policies. Given that the amount of any potential liabilities related to such indemnities cannot be determined until a lawsuit has been filed, we are unable to determine the maximum amount of losses that we could incur relating to such indemnities. | ||||||||||||||||||||||||||||
We have also entered into severance and change in control agreements with certain of our executives. These agreements provide for the payment of specific compensation benefits to such executives upon the termination of their employment with us. | ||||||||||||||||||||||||||||
Guarantees and Indemnities | ||||||||||||||||||||||||||||
In the normal course of business, we are occasionally required to undertake indemnification for which we may be required to make future payments under specific circumstances. We review our exposure under such obligations no less than annually, or more frequently as required. The amount of any potential liabilities related to such obligations cannot be accurately determined until a formal claim is filed. Historically, any such amounts that become payable have not had a material negative effect our business, financial condition or results of operations. We maintain general and product liability insurance which may provide a source of recovery to us in the event of an indemnification claim. |
CONTINGENCIES
CONTINGENCIES | 12 Months Ended | |||||||||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||||||||||||||
CONTINGENCIES | ' | |||||||||||||||||||||||||||
COMMITMENTS | ||||||||||||||||||||||||||||
Operating Leases and Software Licenses | ||||||||||||||||||||||||||||
We lease facilities under non-cancellable operating leases. The leases expire at various dates through fiscal year 2018 and frequently include renewal provisions for varying periods of time, provisions which require us to pay taxes, insurance, maintenance costs or provisions for minimum rent increases. Minimum lease payments, including scheduled rent increases, are recognized as rent expenses on a straight-line basis over the applicable lease term. Lease incentives received are recognized as a reduction of rental expense on a straight-line basis over the term of the lease. Rent expense, including common area maintenance expense, under operating leases totaled $3.0 million for fiscal year 2014, $3.5 million for fiscal year 2013, and $3.0 million for fiscal year 2012. | ||||||||||||||||||||||||||||
Software license commitments represent non-cancellable licenses of intellectual property from third-parties used in the development of our products. | ||||||||||||||||||||||||||||
Future minimum lease payments under non-cancellable operating leases that have remaining non-cancellable lease terms in excess of one year and software licenses are as follows: | ||||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | Total | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||
Operating leases | $ | 2,002 | $ | 651 | $ | 169 | $ | 60 | $ | — | $ | — | $ | 2,882 | ||||||||||||||
Software licenses | 8,084 | 4,555 | 4,275 | 4,175 | — | — | 21,089 | |||||||||||||||||||||
Total | $ | 10,086 | $ | 5,206 | $ | 4,444 | $ | 4,235 | $ | — | $ | — | $ | 23,971 | ||||||||||||||
CONTINGENCIES | ||||||||||||||||||||||||||||
We are involved in legal proceedings in the ordinary course of business, including actions against us which assert or may assert claims or seek to impose fines and penalties in substantial amounts. Related legal defense costs are expensed as incurred. | ||||||||||||||||||||||||||||
Patents and Technology Licenses | ||||||||||||||||||||||||||||
We have entered into various licensing agreements requiring primarily fixed fee royalty payments. Certain of these agreements contain provisions for the payment of guaranteed or minimum royalty amounts. In the event that we fail to pay any minimum annual royalties, these licenses may automatically be terminated. | ||||||||||||||||||||||||||||
Warranties | ||||||||||||||||||||||||||||
We establish reserves for future product warranty costs that are expected to be incurred pursuant to specific warranty provisions with our customers. We generally warrant our products against defects for one year from date of shipment, with certain exceptions in which the warranty period can extend to more than one year based on contractual agreements. Our warranty reserves are established at the time of sale and updated throughout the warranty period based upon numerous factors including historical warranty return rates and expenses over various warranty periods. Historically, our warranty returns have not been material. | ||||||||||||||||||||||||||||
Intellectual Property Indemnities | ||||||||||||||||||||||||||||
We indemnify certain customers and our contract manufacturers against liability arising from third-party claims of intellectual property rights infringement related to our products. These indemnities appear in development and supply agreements with our customers as well as manufacturing service agreements with our contract manufacturers, are not limited in amount or duration and generally survive the expiration of the contract. Given that the amount of any potential liabilities related to such indemnities cannot be determined until an infringement claim has been made, we are unable to determine the maximum amount of losses that we could incur related to such indemnifications. | ||||||||||||||||||||||||||||
Director and Officer Indemnities and Contractual Guarantees | ||||||||||||||||||||||||||||
We have entered into indemnification agreements with our directors and executive officers, which require us to indemnify such individuals to the fullest extent permitted by Delaware law. Our indemnification obligations under such agreements are not limited in amount or duration. Certain costs incurred in connection with such indemnifications may be recovered under certain circumstances under various insurance policies. Given that the amount of any potential liabilities related to such indemnities cannot be determined until a lawsuit has been filed, we are unable to determine the maximum amount of losses that we could incur relating to such indemnities. | ||||||||||||||||||||||||||||
We have also entered into severance and change in control agreements with certain of our executives. These agreements provide for the payment of specific compensation benefits to such executives upon the termination of their employment with us. | ||||||||||||||||||||||||||||
Guarantees and Indemnities | ||||||||||||||||||||||||||||
In the normal course of business, we are occasionally required to undertake indemnification for which we may be required to make future payments under specific circumstances. We review our exposure under such obligations no less than annually, or more frequently as required. The amount of any potential liabilities related to such obligations cannot be accurately determined until a formal claim is filed. Historically, any such amounts that become payable have not had a material negative effect our business, financial condition or results of operations. We maintain general and product liability insurance which may provide a source of recovery to us in the event of an indemnification claim. |
SUBSEQUENT_EVENT
SUBSEQUENT EVENT | 12 Months Ended |
Sep. 30, 2014 | |
Subsequent Events [Abstract] | ' |
SUBSEQUENT EVENT | ' |
SUBSEQUENT EVENT | |
We repaid the outstanding principal of $32.8 million of our 2014 Debentures, plus accrued interest, on October 30, 2014, the maturity date of the debentures. |
QUARTERLY_FINANCIAL_DATA_UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended | |||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||||||
Quarterly Financial Data (Unaudited) | ' | |||||||||||||||||||
UARTERLY FINANCIAL DATA (UNAUDITED) | ||||||||||||||||||||
The following tables set forth the consolidated statements of operations for each of our last eight quarters. This quarterly information is derived from unaudited interim financial statements and has been prepared on the same basis as the annual consolidated financial statements. The per-share computation for the fiscal year is a separate, annual calculation. Accordingly, the sum of the quarterly per-share amounts does not necessarily equal the annual per-share amount. In management’s opinion, this quarterly information reflects all adjustments necessary for fair presentation of the information for the periods presented. The operating results for any quarter are not indicative of results for any future period. | ||||||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | Total Year | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Fiscal Year 2014: | ||||||||||||||||||||
Net revenues: | ||||||||||||||||||||
Product revenues | $ | 24,863 | $ | 24,869 | $ | 26,012 | $ | 27,007 | $ | 102,751 | ||||||||||
Intellectual property revenues | 2,220 | 723 | 1,139 | 1,664 | 5,746 | |||||||||||||||
Net revenues | 27,083 | 25,592 | 27,151 | 28,671 | 108,497 | |||||||||||||||
Cost of product revenues | 10,676 | 10,979 | 12,254 | 10,571 | 44,480 | |||||||||||||||
Loss from operations | (2,214 | ) | (4,379 | ) | (2,527 | ) | (654 | ) | (9,774 | ) | ||||||||||
Net loss | (5,371 | ) | (5,831 | ) | (4,388 | ) | (2,485 | ) | (18,075 | ) | ||||||||||
Net loss per share - basic and diluted | $ | (0.09 | ) | $ | (0.10 | ) | $ | (0.07 | ) | $ | (0.04 | ) | $ | (0.30 | ) | |||||
Weighted average shares outstanding: | ||||||||||||||||||||
Basic and diluted | 57,610 | 58,327 | 59,965 | 67,580 | 60,887 | |||||||||||||||
Fiscal Year 2013: | ||||||||||||||||||||
Net revenues: | ||||||||||||||||||||
Product revenues | $ | 23,905 | $ | 24,689 | $ | 26,285 | $ | 26,455 | $ | 101,334 | ||||||||||
Intellectual property revenues | 1,822 | 64 | 133 | 420 | 2,439 | |||||||||||||||
Net revenues | 25,727 | 24,753 | 26,418 | 26,875 | 103,773 | |||||||||||||||
Cost of product revenues | 10,975 | 11,369 | 11,666 | 12,753 | 46,763 | |||||||||||||||
Loss from operations | (3,819 | ) | (3,872 | ) | (4,291 | ) | (3,492 | ) | (15,474 | ) | ||||||||||
Net loss | (5,032 | ) | (4,847 | ) | (6,434 | ) | (5,765 | ) | (22,078 | ) | ||||||||||
Net loss per share - basic and diluted | $ | (0.18 | ) | $ | (0.13 | ) | $ | (0.17 | ) | $ | (0.10 | ) | $ | (0.55 | ) | |||||
Weighted average shares outstanding: | ||||||||||||||||||||
Basic and diluted | 28,059 | 37,215 | 38,630 | 57,254 | 40,311 | |||||||||||||||
In the first quarter of fiscal year 2014, we recorded a loss on extinguishment of debt of $1.6 million due to the repurchase in November 2013 of $13.7 million principal amount of our 2014 Debentures at 107% of the principal amount thereof. | ||||||||||||||||||||
In the first quarter of fiscal year 2013, we recorded a gain on our compound embedded derivative of $0.8 million related to our 2014 Debentures. |
SCHEDULE_II_Valuation_and_Qual
SCHEDULE II - Valuation and Qualifying Accounts | 12 Months Ended | |||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ' | |||||||||||||||||||
SCHEDULE II - Valuation and Qualifying Accounts | ' | |||||||||||||||||||
SCHEDULE II-Valuation and Qualifying Accounts | ||||||||||||||||||||
Balance at Beginning of Year | Charged to Costs and Expenses | Charged to Other Accounts | Deductions/Write-offs | Balance at End of Year | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Year ended September 30, 2014 | ||||||||||||||||||||
Deducted from accounts receivable: | ||||||||||||||||||||
Allowance for doubtful accounts | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||
Deducted from deferred tax asset | ||||||||||||||||||||
Valuation allowance | 68,802 | 6,287 | — | (10,335 | ) | 64,754 | ||||||||||||||
Year ended September 30, 2013 | ||||||||||||||||||||
Deducted from accounts receivable: | ||||||||||||||||||||
Allowance for doubtful accounts | 258 | (142 | ) | — | (116 | ) | — | |||||||||||||
Deducted from deferred tax asset | ||||||||||||||||||||
Valuation allowance(1) | 102,408 | (487 | ) | — | (33,119 | ) | 68,802 | |||||||||||||
Year ended September 30, 2012 | ||||||||||||||||||||
Deducted from accounts receivable: | ||||||||||||||||||||
Allowance for doubtful accounts | 2,212 | (1,954 | ) | — | — | 258 | ||||||||||||||
Deducted from deferred tax asset | ||||||||||||||||||||
Valuation allowance(1) | $ | 92,671 | $ | (1,147 | ) | $ | — | $ | 10,884 | $ | 102,408 | |||||||||
-1 | As discussed in Note 8, the Company identified an overstatement of its previously disclosed deferred tax asset for stock based compensation and the related deferred tax asset valuation allowance in the amount of $9.1 million, $9.4 million, and $8.1 million as of September 30, 2013, 2012 and 2011, respectively. The Company evaluated the impact of these errors in accordance with SAB No. 99 and concluded that they were not material. Further, the Company maintains a full valuation allowance on all of its U.S. and state deferred tax assets, and there was no impact on the Company’s financial position and results of operations. As of September 30, 2014 the Company recorded an adjustment of $9.1 million to decrease both the deferred tax asset for stock based compensation and the related valuation allowance. The previously reported amounts have not been revised. |
THE_COMPANY_AND_ITS_SIGNIFICAN1
THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Sep. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Fiscal Year | ' |
Fiscal Year | |
Our fiscal year is October 1 through September 30. | |
Basis of Presentation | ' |
Basis of Presentation | |
The accompanying consolidated financial statements are prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and accounting principles generally accepted in the United States of America (“GAAP”). Our reporting currency is the United States dollar. Our consolidated financial statements include the accounts of Vitesse and our subsidiaries. All inter-company accounts and transactions were eliminated in consolidation. | |
Reclassifications | ' |
Reclassifications | |
Certain reclassifications have been made to prior fiscal year amounts and related footnotes to conform to current fiscal year presentation with no changes to stockholders’ equity (deficit) amounts or net loss for fiscal year 2013 or 2012. | |
Foreign Currency Translation | ' |
Foreign Currency Translation | |
The functional currency of our foreign subsidiaries is the United States dollar; however, our foreign subsidiaries transact in local currencies. Consequently, assets and liabilities are translated into United States dollars at the exchange rate on the balance sheet date. Revenues and expenses are translated at the average exchange rate prevailing during the period. Foreign currency transaction and translation gains and losses are included in results of operations. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and disclosures made in the accompanying notes to the consolidated financial statements. Management regularly evaluates estimates and assumptions related to revenue recognition, allowances for doubtful accounts, warranty reserves, inventory valuation reserves, stock-based compensation, compound embedded derivative valuation, purchased intangible asset valuations and useful lives, asset retirement obligations, and deferred income tax asset valuation allowances. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The actual results we experience may differ materially and adversely from our original estimates. To the extent there are material differences between the estimates and the actual results, our future results of operations will be affected. | |
Revenue Recognition, Product Revenues | ' |
Product Revenues | |
In accordance with Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition, we recognize product revenues when the following fundamental criteria are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the price to the customer is fixed or determinable; and (iv) collection of the sales price is reasonably assured. Delivery occurs when goods are shipped and title and risk of loss transfer to the customer, in accordance with the terms specified in the arrangement with the customer. Revenue recognition is deferred where the earnings process is incomplete. | |
A portion of our product sales is made through distributors under agreements allowing for pricing credits and/or right of return. Our past history with these pricing credits and/or right of return provisions prevent us from being able to reasonably estimate the final price of our inventory to be sold and the amount of inventory that could be returned pursuant to these agreements. As a result, the fixed and determinable revenue recognition criterion has not been met at the time we deliver products allowing for pricing credits or right of returns. Accordingly, product revenues from sales made through these distributors is not recognized until the distributors ship the product to their customers. We also maintain inventory, or hub, arrangements with certain customers. Pursuant to these arrangements, we deliver products to a customer or a designated third-party warehouse based upon the customer’s projected needs, but do not recognize revenue unless and until the customer reports that it has removed our product from the warehouse and taken title and risk of loss. | |
From time-to-time, we may ship goods to our distributors with no pricing credits and/or no or limited right of return. Under these circumstances, at the time of shipment, product prices are fixed or determinable and the amount of future returns and pricing allowances to be granted in the future can be reasonably estimated and are accrued. Accordingly, revenues are recorded net of these estimated amounts. | |
Revenue Recognition, Intellectual Property Revenues | ' |
Intellectual Property Revenues | |
We derive intellectual property revenues from the sale and licensing of our intellectual property, maintenance and support and royalty revenues following the sale by our licensees of products incorporating the licensed technology. We enter into intellectual property licensing agreements that generally provide licensees the right to incorporate our intellectual property components in their products with terms and conditions that vary by licensee. Our intellectual property licensing agreements may include multiple elements with an intellectual property license bundled with support services. For such multiple element intellectual property licensing arrangements, we follow the guidance in ASC Topic 605-25, Multiple-Element Arrangements, to determine whether there is more than one unit of accounting. | |
We recognize revenue from the sale of patents when there is persuasive evidence of an arrangement, fees are fixed or determinable, delivery has occurred, and collectability is reasonably assured. All of the requirements are generally fulfilled upon execution of the patent sale arrangement. | |
License and contract revenues are recorded upon delivery of the technology when there is persuasive evidence of an arrangement, fees are fixed or determinable, delivery has occurred, and collectability is reasonably assured. The timing of delivery is dependent on, and varies with, the terms of each contract. Other than maintenance and support, there is no continuing obligation under these arrangements after delivery of the intellectual property. Deferred revenue is created when we bill a customer in accordance with a contract prior to having met the requirements for revenue recognition. | |
Certain of our agreements may contain support obligations. Under such agreements we provide unspecified fixes and technical support. No other upgrades, products, or post-contract support are provided. These arrangements may be renewable annually by the customer. Support revenues are recognized ratably over the period during which the obligation exists, typically 12 months or less. | |
We recognize royalty revenues in the period in which the licensee reports shipment of products incorporating our intellectual property components. Royalties are calculated on a per unit basis, as specified in our agreement with the licensee. We may, at our discretion and in accordance with our agreements, engage a third-party to perform royalty audits of our licensees. Any correction of royalties previously reported would occur when the results are resolved. | |
Revenue Recognition, Multiple Element Transactions | ' |
For multiple-element arrangements, we allocate revenue to all deliverables based on their relative selling prices. In such circumstances, we use a hierarchy to determine the selling price to be used for allocating revenues to deliverables: (i) vendor-specific objective evidence of fair value (“VSOE”); (ii) third-party evidence of selling price (“TPE”); and (iii) best estimate of the selling price (“ESP”). VSOE generally exists only when we sell the deliverable separately and revenue is the price actually charged by us for that deliverable. Generally, we are not able to determine TPE because our licensing arrangements differ from that of our peers. We have concluded that no VSOE or TPE exists because it is rare that either we or our competitors sell the deliverables on a stand-alone basis. ESPs reflect our best estimate of what the selling prices of the elements would be if they were sold regularly on a stand-alone basis. While changes in the allocation of the estimated sales price between the units of accounting will not affect the amount of total revenue recognized for a particular sales arrangement, any material changes in these allocations could impact the timing of revenue recognition, which could affect our results of operations. | |
In determining ESPs, we apply significant judgment as we weigh a variety of factors, based on the facts and circumstances of the arrangement. The facts and circumstances we may consider include, but are not limited to, prices charged for similar offerings, if any, our historical pricing practices as well as the nature and complexity of different technologies being licensed, geographies and the number of uses allowed for a given license. | |
Shipping and Handling Fees and Costs | ' |
Shipping and Handling Fees and Costs | |
Amounts billed to customers for shipping and handling is presented in product revenues. Costs incurred for shipping and handling are included in cost of revenues. | |
Engineering, Research and Development Costs | ' |
Engineering, Research and Development Costs | |
Engineering, research and development (“R&D”) costs are expensed when incurred. R&D expenses consist primarily of compensation expenses for employees and contractors engaged in research, design and development activities. R&D expenses also include costs of mask tooling, which we fully expense in the period, electronic design automation tools, software licensing contracts, subcontracting and fabrication, depreciation and amortization, and overhead including facilities expenses. | |
Intellectual property purchased from third parties is capitalized and amortized over the useful life of the intellectual property. | |
Marketing Costs | ' |
Marketing Costs | |
All of the costs related to marketing and advertising our products are expensed as incurred or at the time the marketing takes place. | |
Stock-based Compensation | ' |
Stock‑Based Compensation | |
ASC Topic 718, Compensation-Stock Compensation (“ASC 718”) requires that all stock‑based payments to employees, including grants of employee stock options and employee stock purchase rights, to be recognized in the financial statements based on their respective grant date fair values. The benefits of tax deductions in excess of recognized compensation cost are required to be reported as a financing cash flow, rather than operating cash flow, as required under previous literature. It is also required to calculate the compensation cost of full-value awards such as restricted stock based on the market value of the underlying stock at the date of the grant. We estimate the expected life of a stock award as the period of time that the award is expected to be outstanding. Expected lives are estimated in accordance with SEC Staff Accounting Bulletin (“SAB”) No. 107, as amended by SAB No. 110, which provides supplemental application guidance based on the views of the SEC. We are further required to estimate the fair value of stock‑based payment awards on the date of grant using an option‑pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense ratably over the requisite service periods. We estimate the fair value of each award as of the date of grant using the Black‑Scholes option pricing model, which was developed for use in estimating the value of traded options that have no vesting restrictions and that are freely transferable. The Black‑Scholes model considers, among other factors, the expected life of the award and the expected volatility of our stock price. Although the Black‑Scholes model meets the accounting guidance requirements, the fair values generated by the model may not be indicative of the actual fair values of our awards, as it does not consider other factors important to those stock-based payment awards, such as continued employment, periodic vesting requirements, and limited transferability. | |
We have elected to recognize compensation expense for all stock‑based awards on a straight-line basis over the requisite service period for the entire award. The amount of compensation expense recognized through the end of each reporting period is equal to the portion of the grant-date value of the awards that have vested, or for partially vested awards, the value of the portion of the award that is ultimately expected to vest for which the requisite services have been provided. | |
Other Income, Net | ' |
Other Income, Net | |
Other income, net, consists of interest income, foreign exchange gains and losses and other non-operating gains and losses. | |
Income Taxes | ' |
Income Taxes | |
We account for income taxes pursuant to the provisions of ASC Topic 740, Income Taxes (“ASC 740”). Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards. We assess the likelihood that our deferred tax assets will be recovered from future taxable income and to the extent we believe that recovery is not “more likely than not,” we establish a valuation allowance. To the extent we establish a valuation allowance or increase or decrease this allowance in a period, we include an expense or benefit within the tax provision in the statement of operations. ASC Topic 740-10 prescribes a “more likely than not” recognition threshold and measurement analysis for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. We recognize potential accrued interest and penalties related to unrecognized tax benefits within the consolidated statements of operations as income tax expense. | |
Net Loss per Share | ' |
Net Loss per Share | |
Basic and diluted net income and loss per share is computed by dividing net income or loss by the weighted average number of common shares outstanding during the period. | |
For periods in which we report net income, the weighted average number of shares used to calculate diluted income per share is inclusive of common stock equivalents from unexercised stock options, restricted stock units, shares to be issued under our Employee Stock Purchase Plan (“ESPP”), convertible preferred stock, convertible subordinated debentures (“2014 Debentures”) and senior term B loan. Unexercised stock options, restricted stock units, and unvested shares to be issued under our ESPP, are considered to be common stock equivalents if, using the treasury stock method, they are determined to be dilutive. | |
Under the two-class method of determining earnings for each class of stock, we consider the dividend rights and participating rights in undistributed earnings for each class of stock. The allocation of undistributed earnings to preferred shares is equal to the amount of earnings per common share that would be distributed on an as-converted basis. | |
Allowance for Doubtful Accounts | ' |
Accounts Receivable and Allowance for Doubtful Accounts | |
Accounts receivable are recorded at the invoice amount and presented net of the allowance for doubtful accounts; they do not bear interest. We evaluate the collectability of accounts receivable at each balance sheet date using a combination of factors, such as historical experience, credit quality, age of the accounts receivable balances, and economic conditions that may affect a customer’s ability to pay. We include any accounts receivable balances that are determined to be uncollectible in the overall allowance for doubtful accounts using the specific identification method. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. | |
Inventory | ' |
Inventories | |
Inventories are stated at lower of cost or market and consist of materials, labor and overhead. Inventory costs are determined using standard costs which approximate actual costs under the first-in, first-out method. Costs include the costs of purchased finished products, sorted wafers, and outsourced assembly, testing and internal overhead. We evaluate inventories for excess quantities and obsolescence. Our evaluation considers market and economic conditions; technology changes, new product introductions, and changes in strategic business direction; and requires estimates that may include elements that are uncertain. In order to state the inventory at lower of cost or market, we maintain reserves against individual stocking units. Inventory write-downs, once established, are not reversed until the related inventories have been sold or scrapped. If future demand or market conditions are less favorable than our projections, a write-down of inventory may be required, and would be reflected in cost of product revenues sold in the period the revision is made. | |
Property, Plant and Equipment | ' |
Property, Plant and Equipment | |
Property, plant and equipment are carried at cost less depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the assets’ remaining estimated useful lives, ranging from two to five years for machinery and equipment, including product tooling; and the shorter of lease terms or estimated useful lives for leasehold improvements. When property, plant and equipment is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts. Gains and losses from retirements and asset disposals are recorded in selling, general and administrative (“SG&A”) expenses. | |
We evaluate the recoverability of property, plant and equipment in accordance with ASC Topic 360, Property, Plant, and Equipment. We perform periodic reviews to determine whether facts and circumstances exist that would indicate that the carrying amounts of property, plant and equipment exceeds their fair values. If facts and circumstances indicate that the carrying amount of property, plant and equipment might not be fully recoverable, projected undiscounted net cash flows associated with the related asset or group of assets over their estimated remaining useful lives are compared against their respective carrying amounts. In the event that the projected undiscounted cash flows are not sufficient to recover the carrying value of the assets, the assets are written down to their estimated fair values. All long-lived assets to be disposed of are reported at the lower of carrying amount or fair market value, less expected selling costs. | |
Intangible Assets | ' |
Intangible Assets | |
Our intangible assets consist primarily of technology licensing agreements with third-parties and are carried at cost less amortization. We account for intangible assets in accordance with ASC Topic 350, Intangibles - Goodwill and Other. We evaluate our finite-lived assets for impairment whenever events or changes in circumstances indicate the carrying value of an intangible asset or asset group may not be recoverable. The carrying value of an intangible asset or asset group is not recoverable if the amounts of undiscounted future cash flows the assets are expected to generate (including any net proceeds expected from the disposal of the asset) are less than its carrying value. When we identify that impairment has occurred, we reduce the carrying value of the asset to its comparable market value (if available and appropriate) or to its estimated fair value based on a discounted cash flow approach. Currently, we do not have goodwill or indefinite-lived intangible assets. | |
Fair Value | ' |
Fair Value | |
ASC Topic 820, Fair Value Measurements (“ASC 820”), establishes a framework for measuring fair value and requires disclosures about fair value measurement. ASC 820 emphasizes that a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820 established the following fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) the reporting entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs): | |
Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets; | |
Level 2: Other inputs observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborate inputs; and | |
Level 3: Unobservable inputs for which there is little or no market data and which requires the owner of the assets or liabilities to develop its own assumptions about how market participants would price these assets or liabilities. | |
Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy. | |
Financial Instruments | ' |
Financial Instruments | |
ASC Topic 825, Financial Instruments, defines the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. Our financial instruments include cash, accounts receivable, accounts payable, and accrued expenses. These financial instruments are stated at their carrying values, which are estimates of their fair values because of their nearness to cash settlement or the comparability of their terms to the terms we could obtain, for similar instruments, in the current market. Our debt instruments are included in current portion of debt, net, long-term debt, net, and convertible subordinated debt, net on our consolidated balance sheets. | |
Senior Term A Loan | |
At its inception, the fair value of our senior term A loan (the “Term A Loan”) was computed using a cash flow analysis in which the periodic cash coupon payments and the principal payment at maturity were discounted to the valuation date using an appropriate market discount rate. The discount rate was determined by analyzing the seniority and securitization of the instrument, our financial condition, and observing the quoted bond yields in the fixed income market as of the valuation date. The valuation was determined using Level 3 inputs. | |
Senior Term B Loan | |
At its inception, the fair value of our senior term B loan (“the Term B Loan”) was computed using a binomial-lattice model. The valuation was determined using Level 3 inputs. The valuation model combined expected cash outflows with market-based assumptions regarding risk-adjusted yields, stock price volatility, recent price quotes and trading information of our common stock into which the Term B Loan is convertible. | |
Convertible Subordinated Debt | |
The 2014 Debentures required bifurcation and accounting at fair value because the economic and contractual characteristics of the compound embedded derivative met the criteria for bifurcation and separate accounting due to the conversion price not being indexed to our own stock. The compound embedded derivative was comprised of the conversion option and a make-whole payment for foregone interest if the holder converted the debenture early. The make-whole payment for foregone interest expired October 30, 2012, and upon its expiration, the compound embedded derivative no longer met the criteria for bifurcation as all components of the conversion feature were indexed to our own common stock. | |
At its inception, the approximate fair value of the compound embedded derivative included in our 2014 Debentures was computed as the difference between the estimated value of the 2014 Debentures with and without the compound embedded derivative features. The fair value of the 2014 Debentures was estimated using a convertible bond valuation model within a binomial-lattice framework. These valuations were determined using Level 3 inputs. The valuation model combines expected cash outflows with market-based assumptions regarding risk-adjusted yields, stock price volatility, recent price quotes, and trading information of our common stock into which the 2014 Debentures are convertible. Significant increases (decreases) in any of those inputs in isolation would result in a significantly lower (higher) fair value measurement. | |
The compound embedded derivative was presented on the balance sheet at fair value and was marked-to-market, until the make-whole payment for foregone interest expired on October 30, 2012. The change in the fair value of the compound embedded derivative was a non-cash item primarily related to the change in price of the underlying common stock and is reflected in earnings. | |
The valuation methodologies we use as described above require considerable judgment and may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, although we believe our valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. | |
Warranty | ' |
Warranty | |
We establish reserves for future product warranty costs that are expected to be incurred pursuant to specific warranty provisions with our customers. We generally warrant our products against defects for one year from date of shipment, with certain exceptions in which the warranty period can extend to more than one year based on contractual agreements. A warranty reserve is recorded against revenues when products are shipped. At each reporting period, we adjust our reserve for warranty claims based on our actual warranty claims experience as a percentage of net revenues for the preceding 12 months and also consider the effect of known operational issues that may have an impact that differs from historical trends. Historically, our warranty returns have not been material. | |
Contingencies | ' |
Contingencies | |
We assess our exposure to loss contingencies, including environmental, legal and income tax matters, and provide an accrual for exposure if it is judged to be probable and reasonably estimable. If the actual loss from a loss contingency differs from management’s estimates, results of operations could be adjusted upward or downward. | |
Recent Accounting Pronouncements | ' |
Recent Accounting Pronouncements | |
In July 2013, the FASB issued ASU 2013-11, Income Taxes (Topic 740): Presentation of Unrecognized Tax Benefit When a Net Operating Loss Carryforward, A Similar Tax Loss, or a Tax Credit Carryforward Exists (A Consensus the FASB Emerging Issues Task Force). ASU 2013-11 provides guidance on financial statement presentation of unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The FASB’s objective in issuing this ASU is to eliminate diversity in practice resulting from a lack of guidance on this topic in current GAAP. This ASU applies to all entities with unrecognized tax benefits that also have tax loss or tax credit carryforwards in the same tax jurisdiction as of the reporting date. This amendment is effective for public entities for fiscal years beginning after December 15, 2013, and interim periods within those years. We do not expect the adoption of this standard to have a material impact on our unaudited consolidated financial position and results of operations. | |
In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers, which supersedes nearly all existing revenue recognition guidance under GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP. The standard is effective for annual periods beginning after December 15, 2016, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). We are currently evaluating the impact of our pending adoption of ASU 2014-09 on our consolidated financial statements and have not yet determined the method by which we will adopt the standard in fiscal year 2018. | |
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements-Going Concern (Subtopic 205-40), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This standard sets forth management’s responsibility to evaluate, each reporting period, whether there is substantial doubt about our ability to continue as a going concern, and if so, to provide related footnote disclosures. The standard is effective for annual reporting periods ending after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016. We are currently evaluating this new standard and after adoption, we will incorporate this guidance in our assessment of going concern. |
COMPUTATION_IF_NET_LOSS_PER_SH
COMPUTATION IF NET LOSS PER SHARE (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Schedule of potenital common shares excluded from the diluted computation | ' | ||||||||
The following potentially dilutive common shares are excluded from the computation of net loss per share. | |||||||||
Outstanding as of September 30, | |||||||||
2014 | 2013 | 2012 | |||||||
(in thousands) | |||||||||
Outstanding stock options | 2,940 | 2,089 | 1,813 | ||||||
Outstanding restricted stock units | 2,328 | 2,021 | 1,686 | ||||||
Employee Stock Purchase Plan shares | 491 | 368 | 506 | ||||||
Convertible preferred stock | — | — | 674 | ||||||
2014 Debentures | 7,298 | 10,332 | 10,332 | ||||||
Term B Loan | 1,887 | 1,887 | 1,887 | ||||||
Total potential common shares excluded from calculation | 14,944 | 16,697 | 16,898 | ||||||
DETAILS_OF_CERTAIN_FINANCIAL_S1
DETAILS OF CERTAIN FINANCIAL STATEMENT COMPONENTS (Tables) | 12 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Balance Sheet Related Disclosures [Abstract] | ' | |||||||
Schedule of Inventory | ' | |||||||
The following tables provide details of selected balance sheet items: | ||||||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Inventories: | ||||||||
Raw materials | $ | 1,840 | $ | 1,220 | ||||
Work-in-process | 4,503 | 3,652 | ||||||
Finished goods | 6,449 | 5,820 | ||||||
$ | 12,792 | $ | 10,692 | |||||
Schedule of Property, Plant and Equipment | ' | |||||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Property, Plant and Equipment, Net: | ||||||||
Machinery and equipment | $ | 61,236 | $ | 77,865 | ||||
Furniture and fixtures | 505 | 704 | ||||||
Computer equipment | 7,356 | 8,736 | ||||||
Leasehold improvements | 1,829 | 3,163 | ||||||
Construction in progress | 44 | 305 | ||||||
70,970 | 90,773 | |||||||
Less: Accumulated depreciation | (68,112 | ) | (87,666 | ) | ||||
$ | 2,858 | $ | 3,107 | |||||
Schedule of Intangible Assets | ' | |||||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Other Intangible Assets, Net: | ||||||||
Intellectual property and technology license agreements | $ | 5,490 | $ | 4,824 | ||||
Less: Accumulated amortization | (4,014 | ) | (3,654 | ) | ||||
$ | 1,476 | $ | 1,170 | |||||
Schedule of Other Assets | ' | |||||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Other Assets: | ||||||||
Non-current portion of deferred tax asset, net | $ | 1,288 | $ | 1,273 | ||||
Restricted cash | 1,500 | 1,500 | ||||||
Debt issue costs, net | 8 | 287 | ||||||
Other | 308 | 365 | ||||||
$ | 3,104 | $ | 3,425 | |||||
Schedule of Accrued Expenses and Other Current Liabilities | ' | |||||||
September 30, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Accrued Expenses and Other Current Liabilities: | ||||||||
Accrued software license agreements | $ | 3,335 | $ | 3,526 | ||||
Accrued vacation | 2,580 | 2,442 | ||||||
Accrued wages and benefits | 2,730 | 1,729 | ||||||
Interest payable | 1,645 | 2,196 | ||||||
Accrued income taxes | 408 | 332 | ||||||
Accrued warranty liability | 52 | 60 | ||||||
Accrued other | 1,722 | 1,960 | ||||||
$ | 12,472 | $ | 12,245 | |||||
DEBT_Tables
DEBT (Tables) | 12 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||
Schedule of Long-term Debt Instruments | ' | |||||||||||
September 30, | ||||||||||||
2014 | 2013 | |||||||||||
(in thousands) | ||||||||||||
Term A Loan, bearing interest at 9.0% and 10.5% as of September 30, 2014 and 2013, respectively, due August 2016 | $ | 7,791 | $ | 7,919 | ||||||||
Term B Loan, convertible until October 31, 2014, bearing interest at 9.0% and 8.0% as of September 30, 2014 and 2013, respectively, due August 2016 | 8,626 | 8,444 | ||||||||||
Other | — | 3 | ||||||||||
Long-term debt, net | 16,417 | 16,366 | ||||||||||
2014 Debentures, convertible, 8.0% fixed-rate notes, due October 2014 | 32,727 | 44,384 | ||||||||||
Total debt, net | $ | 49,144 | $ | 60,750 | ||||||||
Additional information about our debt is as follows: | ||||||||||||
Term A Loan | Term B Loan | 2014 Debentures | ||||||||||
(in thousands) | ||||||||||||
Principal | $ | 7,857 | $ | 9,342 | $ | 32,843 | ||||||
Unamortized debt discount | (66 | ) | (716 | ) | (116 | ) | ||||||
Carrying value | $ | 7,791 | $ | 8,626 | $ | 32,727 | ||||||
Interest payable terms | Quarterly, in arrears | Quarterly, in arrears | Semi-annually, in arrears | |||||||||
Annual effective interest rate | 9.5 | % | 13.5 | % | 12.2 | % | ||||||
Conversion price per common share | n/a | $ | 4.95 | $ | 4.5 | |||||||
Schedule of Maturities of Long-term Debt | ' | |||||||||||
Principal maturity of our total aggregated outstanding debt is as follows: | ||||||||||||
Fiscal year | (in thousands) | |||||||||||
2015 | $ | 32,843 | ||||||||||
2016 | 17,199 | |||||||||||
Total | $ | 50,042 | ||||||||||
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Schedule of the fair value of the loans and compound embedded derivative | ' | |||||||||||||||
The estimated fair values of our financial instruments are as follows: | ||||||||||||||||
September 30, | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Carrying value | Fair value | Carrying value | Fair value | |||||||||||||
(in thousands) | ||||||||||||||||
Term A Loan | $ | 7,791 | $ | 8,755 | $ | 7,919 | $ | 8,165 | ||||||||
Term B Loan | 8,626 | 10,245 | 8,444 | 9,781 | ||||||||||||
2014 Debentures | 32,727 | 33,040 | 44,384 | 49,282 | ||||||||||||
STOCK_BASED_COMPENSATION_Table
STOCK BASED COMPENSATION (Tables) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||
Compensation costs related to the stock-based compensation plans | ' | ||||||||||||||||
Compensation cost related to our Plan and ESPP is as follows: | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
(in thousands) | |||||||||||||||||
Cost of revenues | $ | 823 | $ | 617 | $ | 567 | |||||||||||
Engineering, research and development | 2,248 | 1,616 | 1,530 | ||||||||||||||
Selling, general and administrative | 3,004 | 2,163 | 2,345 | ||||||||||||||
Total stock-based compensation expense | $ | 6,075 | $ | 4,396 | $ | 4,442 | |||||||||||
Activity under all stock option plans | ' | ||||||||||||||||
Activity in stock option awards is as follows: | |||||||||||||||||
Shares (in thousands) | Weighted average | Weighted average | Aggregate | ||||||||||||||
exercise price | remaining | intrinsic value (in thousands) | |||||||||||||||
contractual life (in years) | |||||||||||||||||
Options outstanding, September 30, 2011 | 1,699 | $ | 29.77 | 6.37 | $ | — | |||||||||||
Granted | 401 | 2.55 | |||||||||||||||
Exercised | (6 | ) | 2.54 | 3 | |||||||||||||
Cancelled or expired | (281 | ) | 76.87 | ||||||||||||||
Options outstanding, September 30, 2012 | 1,813 | 16.57 | 6.61 | 2 | |||||||||||||
Granted | 464 | 2.12 | |||||||||||||||
Exercised | (9 | ) | 2.24 | 6 | |||||||||||||
Cancelled or expired | (179 | ) | 16.52 | ||||||||||||||
Options outstanding, September 30, 2013 | 2,089 | 13.43 | 6.67 | 591 | |||||||||||||
Granted | 1,014 | 2.53 | |||||||||||||||
Exercised | (52 | ) | 2.36 | 64 | |||||||||||||
Cancelled or expired | (111 | ) | 76.55 | ||||||||||||||
Options outstanding, September 30, 2014 | 2,940 | $ | 7.46 | 7 | $ | 2,059 | |||||||||||
Options exercisable, September 30, 2014 | 1,633 | $ | 11.36 | 5.63 | $ | 668 | |||||||||||
Schedule of stock option by exercise price range | ' | ||||||||||||||||
The following table provides additional information in regards to options outstanding as of September 30, 2014: | |||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||
Range of Exercise Price | Number Outstanding (in thousands) | Weighted Average Remaining Contractual Life (Years) | Weighted Average Exercise Price | Number Exercisable (in thousands) | Weighted Average Exercise Price | ||||||||||||
$2.10 - $2.26 | 424 | 8.43 | $ | 2.11 | 194 | $ | 2.1 | ||||||||||
2.53 | 987 | 9.19 | 2.53 | 116 | 2.53 | ||||||||||||
2.54 - 4.36 | 743 | 6.74 | 3.45 | 542 | 3.49 | ||||||||||||
4.60 - 47.20 | 589 | 4.83 | 7.84 | 583 | 7.87 | ||||||||||||
48.00 - 145.40 | 197 | 0.43 | 57.56 | 198 | 57.56 | ||||||||||||
$2.10 - $145.40 | 2,940 | 7 | $ | 7.46 | 1,633 | $ | 11.36 | ||||||||||
Summary of restricted stock unit activity | ' | ||||||||||||||||
Activity for our restricted stock award units is as follows: | |||||||||||||||||
Restricted | Weighted Average | Weighted average | Aggregate | ||||||||||||||
Stock Units (in thousands) | Grant-Date Fair | remaining | intrinsic value (in thousands) | ||||||||||||||
Value per Share | contractual life (in years) | ||||||||||||||||
Restricted stock units, September 30, 2011 | 1,296 | $ | 4.66 | 1.38 | $ | 3,823 | |||||||||||
Awarded | 1,258 | 2.57 | |||||||||||||||
Released | (721 | ) | 3.99 | ||||||||||||||
Forfeited | (147 | ) | 3.48 | ||||||||||||||
Restricted stock units, September 30, 2012 | 1,686 | 3.49 | 1.09 | 4,113 | |||||||||||||
Awarded | 1,527 | 2.12 | |||||||||||||||
Released | (1,045 | ) | 3.19 | ||||||||||||||
Forfeited | (147 | ) | 2.88 | ||||||||||||||
Restricted stock units, September 30, 2013 | 2,021 | 2.65 | 1.13 | 6,143 | |||||||||||||
Awarded | 1,600 | 2.62 | |||||||||||||||
Released | (1,183 | ) | 2.69 | ||||||||||||||
Forfeited | (110 | ) | 2.6 | ||||||||||||||
Restricted stock units, September 30, 2014 | 2,328 | $ | 2.61 | 0.96 | $ | 8,380 | |||||||||||
Summary of assumptions used to value stock options granted in connection with stock incentive plans | ' | ||||||||||||||||
We determine the fair value of the ESPP awards using the Black-Scholes pricing model. Underlying assumptions used were as follows: | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Expected life (in years) | 0.5 | 0.5 | 0.5 | ||||||||||||||
Expected volatility (range) | 37.1% - 50.3% | 47.6% - 49.8% | 40.4% - 48.4% | ||||||||||||||
Expected dividend | — | — | — | ||||||||||||||
Risk-free interest rate | 0.07% - .08% | 0.11% - .14% | 0.09% - .20% | ||||||||||||||
The per share fair values of stock options granted in connection with stock incentive plans have been estimated using the following weighted average assumptions: | |||||||||||||||||
September 30, | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Expected life (in years) | 5.79 | 5.66 | 6.61 | ||||||||||||||
Expected volatility: | |||||||||||||||||
Weighted-average | 81.50% | 82.00% | 86.90% | ||||||||||||||
Range | 79.5% - 81.6% | 79.8% - 82.1% | 82.2% - 87.1% | ||||||||||||||
Expected dividend | — | — | — | ||||||||||||||
Risk-free interest rate | 1.7% - 1.9% | 0.9% - 1.7% | 1.0% - 1.3% |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||||||||||
Schedule of the Components of Loss From Continuing Operations Before (Benefit) Provision for Income Taxes | ' | ||||||||||||||||||||
The components of loss before income tax expense (benefit) for the years ended September 30, 2014, 2013 and 2012 were as follows: | |||||||||||||||||||||
September 30, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||||
(Loss) income before income taxes: | |||||||||||||||||||||
Domestic | $ | (18,871 | ) | $ | (23,646 | ) | $ | (3,406 | ) | ||||||||||||
Foreign | 1,137 | 1,020 | 2,120 | ||||||||||||||||||
$ | (17,734 | ) | $ | (22,626 | ) | $ | (1,286 | ) | |||||||||||||
Schedule of Components of Income Tax Expense (Benefit) | ' | ||||||||||||||||||||
Income tax expense (benefit) consists of the following for the years ended September 30, 2014, 2013 and 2012: | |||||||||||||||||||||
September 30, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Income tax expense (benefit): | |||||||||||||||||||||
Current: | |||||||||||||||||||||
Federal | $ | (27 | ) | $ | — | $ | (188 | ) | |||||||||||||
State | 71 | 54 | 41 | ||||||||||||||||||
Foreign | 312 | (758 | ) | 1,510 | |||||||||||||||||
Total current | 356 | (704 | ) | 1,363 | |||||||||||||||||
Deferred: | |||||||||||||||||||||
Federal | — | — | — | ||||||||||||||||||
State | — | — | — | ||||||||||||||||||
Foreign | (15 | ) | 156 | (1,537 | ) | ||||||||||||||||
Total deferred | (15 | ) | 156 | (1,537 | ) | ||||||||||||||||
Total income tax expense (benefit): | $ | 341 | $ | (548 | ) | $ | (174 | ) | |||||||||||||
Schedule of Effective Income Tax Rate Reconciliation | ' | ||||||||||||||||||||
A reconciliation of the income tax expense (benefit) by applying the statutory United States federal income tax rate to loss before income tax expense (benefit) is as follows: | |||||||||||||||||||||
September 30, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
$ | % | $ | % | $ | % | ||||||||||||||||
(in thousands, except for percentages) | |||||||||||||||||||||
Federal income tax benefit at statutory rate | $ | (6,030 | ) | 34 | % | $ | (7,693 | ) | 34 | % | $ | (437 | ) | 34 | % | ||||||
State tax benefit net of federal benefit | (242 | ) | 1.4 | % | (536 | ) | 2.4 | % | (13 | ) | 1 | % | |||||||||
Foreign taxes | (68 | ) | 0.4 | % | (1,156 | ) | 5.1 | % | 1,102 | (85.7 | )% | ||||||||||
Tax credits | — | — | % | (438 | ) | 1.9 | % | (1,230 | ) | 95.6 | % | ||||||||||
Nondeductible expenses | 650 | (3.7 | )% | 771 | (3.4 | )% | 1,015 | (78.9 | )% | ||||||||||||
Other | — | — | % | 87 | (0.4 | )% | (100 | ) | 7.9 | % | |||||||||||
Change in valuation allowance | 6,131 | (34.6 | )% | 7,164 | (31.7 | )% | (1,147 | ) | 89.2 | % | |||||||||||
Rate change/other adjustments on deferred taxes | (100 | ) | 0.6 | % | 1,253 | (5.5 | )% | 636 | (49.5 | )% | |||||||||||
Income tax expense (benefit) | $ | 341 | (1.9 | )% | $ | (548 | ) | 2.4 | % | $ | (174 | ) | 13.6 | % | |||||||
Schedule of Deferred Tax Assets and Liabilities | ' | ||||||||||||||||||||
Significant deferred tax assets and liabilities, consist of the following: | |||||||||||||||||||||
September 30, | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Deferred Tax Assets: | |||||||||||||||||||||
Net operating loss carryforward | $ | 31,418 | $ | 27,110 | |||||||||||||||||
Research and development tax credits | 10,165 | 10,574 | |||||||||||||||||||
Deferred income | 2,724 | 2,664 | |||||||||||||||||||
Stock based compensation(1) | 3,354 | 12,313 | |||||||||||||||||||
Fixed assets and intangible property | 7,293 | 7,955 | |||||||||||||||||||
Inventories | 1,714 | 2,256 | |||||||||||||||||||
Allowances and reserves | 9,436 | 9,277 | |||||||||||||||||||
Foreign tax credit/AMT credit | 88 | 88 | |||||||||||||||||||
Other | 3 | 11 | |||||||||||||||||||
Total deferred tax assets | 66,195 | 72,248 | |||||||||||||||||||
Deferred Tax Liabilities: | |||||||||||||||||||||
Debt amortization | (11 | ) | (2,065 | ) | |||||||||||||||||
Total deferred tax liabilities | (11 | ) | (2,065 | ) | |||||||||||||||||
Net deferred income taxes | 66,184 | 70,183 | |||||||||||||||||||
Valuation allowance(1) | (64,788 | ) | (68,802 | ) | |||||||||||||||||
Net deferred tax assets | $ | 1,396 | $ | 1,381 | |||||||||||||||||
Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefit | ' | ||||||||||||||||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefit is as follows: | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Beginning balance as of September 30: | $ | (10,615 | ) | $ | (10,822 | ) | $ | (10,215 | ) | ||||||||||||
Gross decreases - tax positions in prior period | 290 | 354 | — | ||||||||||||||||||
Gross increases - current-period tax positions | — | (147 | ) | (47 | ) | ||||||||||||||||
Gross increases - tax positions in prior period | — | — | (560 | ) | |||||||||||||||||
Ending balance as of September 30: | $ | (10,325 | ) | $ | (10,615 | ) | $ | (10,822 | ) |
SIGNIFICANT_CUSTOMERS_CONCENTR1
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||
Schedule of Revenue by Major Customers by Reporting Segments | ' | |||||||||||
Net revenues from customers equal to or greater than 10% of total net revenues is as follows: | ||||||||||||
September 30, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Nu Horizons Electronics** | * | * | 13.5 | % | ||||||||
WPG Holdings** | 23.8 | % | 17.7 | % | 10.7 | % | ||||||
__________________________________________________ | ||||||||||||
*Less than 10% of total net revenues for period indicated. | ||||||||||||
**Distributors | ||||||||||||
Net Revenues By Geographic Area | ' | |||||||||||
Net revenues by geographic area are as follows: | ||||||||||||
September 30, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(in thousands) | ||||||||||||
United States | $ | 25,284 | $ | 28,454 | $ | 41,559 | ||||||
China, including Hong Kong | 31,653 | 32,545 | 30,786 | |||||||||
Taiwan | 23,649 | 17,430 | 15,871 | |||||||||
Other Asia Pacific | 14,258 | 11,479 | 15,603 | |||||||||
Europe, Middle East and Africa | 13,653 | 13,865 | 15,664 | |||||||||
Total net revenues | $ | 108,497 | $ | 103,773 | $ | 119,483 | ||||||
Product Revenues by the Three Product Lines | ' | |||||||||||
We also classify our product revenues based on our three product lines: (i) Ethernet switching, (ii) Connectivity and (iii) Transport processing. Product revenues by product lines are as follows: | ||||||||||||
September 30, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
(in thousands) | ||||||||||||
Ethernet switching | $ | 50,914 | $ | 38,675 | $ | 32,607 | ||||||
Connectivity | 41,017 | 42,885 | 52,933 | |||||||||
Transport processing | 10,820 | 19,774 | 24,380 | |||||||||
Product revenues | $ | 102,751 | $ | 101,334 | $ | 109,920 | ||||||
Schedule of Long-lived Assets (excluding intangible assets) by Country | ' | |||||||||||
Long-lived assets, which consist of property, plant and equipment, net of accumulated depreciation, are summarized as follows: | ||||||||||||
September 30, | ||||||||||||
2014 | 2013 | |||||||||||
(in thousands) | ||||||||||||
Located within the United States | $ | 1,628 | $ | 1,615 | ||||||||
Located outside the United States | 1,230 | 1,492 | ||||||||||
$ | 2,858 | $ | 3,107 | |||||||||
COMMITMENTS_Tables
COMMITMENTS (Tables) | 12 Months Ended | |||||||||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||||||||||||||
Schedule of Future Minimum Lease Payments and Software Licenses | ' | |||||||||||||||||||||||||||
Future minimum lease payments under non-cancellable operating leases that have remaining non-cancellable lease terms in excess of one year and software licenses are as follows: | ||||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | Total | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||
Operating leases | $ | 2,002 | $ | 651 | $ | 169 | $ | 60 | $ | — | $ | — | $ | 2,882 | ||||||||||||||
Software licenses | 8,084 | 4,555 | 4,275 | 4,175 | — | — | 21,089 | |||||||||||||||||||||
Total | $ | 10,086 | $ | 5,206 | $ | 4,444 | $ | 4,235 | $ | — | $ | — | $ | 23,971 | ||||||||||||||
QUARTERLY_FINANCIAL_DATA_Table
QUARTERLY FINANCIAL DATA (Tables) | 12 Months Ended | |||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||||||
Schedule of Quarterly Financial Information | ' | |||||||||||||||||||
The operating results for any quarter are not indicative of results for any future period. | ||||||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | Total Year | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Fiscal Year 2014: | ||||||||||||||||||||
Net revenues: | ||||||||||||||||||||
Product revenues | $ | 24,863 | $ | 24,869 | $ | 26,012 | $ | 27,007 | $ | 102,751 | ||||||||||
Intellectual property revenues | 2,220 | 723 | 1,139 | 1,664 | 5,746 | |||||||||||||||
Net revenues | 27,083 | 25,592 | 27,151 | 28,671 | 108,497 | |||||||||||||||
Cost of product revenues | 10,676 | 10,979 | 12,254 | 10,571 | 44,480 | |||||||||||||||
Loss from operations | (2,214 | ) | (4,379 | ) | (2,527 | ) | (654 | ) | (9,774 | ) | ||||||||||
Net loss | (5,371 | ) | (5,831 | ) | (4,388 | ) | (2,485 | ) | (18,075 | ) | ||||||||||
Net loss per share - basic and diluted | $ | (0.09 | ) | $ | (0.10 | ) | $ | (0.07 | ) | $ | (0.04 | ) | $ | (0.30 | ) | |||||
Weighted average shares outstanding: | ||||||||||||||||||||
Basic and diluted | 57,610 | 58,327 | 59,965 | 67,580 | 60,887 | |||||||||||||||
Fiscal Year 2013: | ||||||||||||||||||||
Net revenues: | ||||||||||||||||||||
Product revenues | $ | 23,905 | $ | 24,689 | $ | 26,285 | $ | 26,455 | $ | 101,334 | ||||||||||
Intellectual property revenues | 1,822 | 64 | 133 | 420 | 2,439 | |||||||||||||||
Net revenues | 25,727 | 24,753 | 26,418 | 26,875 | 103,773 | |||||||||||||||
Cost of product revenues | 10,975 | 11,369 | 11,666 | 12,753 | 46,763 | |||||||||||||||
Loss from operations | (3,819 | ) | (3,872 | ) | (4,291 | ) | (3,492 | ) | (15,474 | ) | ||||||||||
Net loss | (5,032 | ) | (4,847 | ) | (6,434 | ) | (5,765 | ) | (22,078 | ) | ||||||||||
Net loss per share - basic and diluted | $ | (0.18 | ) | $ | (0.13 | ) | $ | (0.17 | ) | $ | (0.10 | ) | $ | (0.55 | ) | |||||
Weighted average shares outstanding: | ||||||||||||||||||||
Basic and diluted | 28,059 | 37,215 | 38,630 | 57,254 | 40,311 | |||||||||||||||
THE_COMPANY_AND_ITS_SIGNIFICAN2
THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
major_customer | major_customer | |
Organization, Consolidation and Presentation [Line Items] | ' | ' |
Allowance for Doubtful Accounts | 0 | 0 |
Standard Product Warranty Period | '1 year | ' |
Reserve Adjustment Period | '12 months | ' |
Minimum | ' | ' |
Organization, Consolidation and Presentation [Line Items] | ' | ' |
Property, Plant and Equipment, Useful Life | '2 years | ' |
Maximum | ' | ' |
Organization, Consolidation and Presentation [Line Items] | ' | ' |
Property, Plant and Equipment, Useful Life | '5 years | ' |
Accounts Receivable | Customer Concentration Risk | ' | ' |
Organization, Consolidation and Presentation [Line Items] | ' | ' |
Number of Major Customers | 2 | 2 |
Concentration Risk, Percentage | 24.30% | 23.80% |
COMPUTATION_OF_NET_LOSS_PER_SH1
COMPUTATION OF NET LOSS PER SHARE Schedule of Potential Common Shares Excluded from the Diluted Computation (Details) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Total potential common shares excluded from calculation | 14,944 | 16,697 | 16,898 |
Outstanding stock options | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Total potential common shares excluded from calculation | 2,940 | 2,089 | 1,813 |
Outstanding restricted stock units | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Total potential common shares excluded from calculation | 2,328 | 2,021 | 1,686 |
Employee Stock Purchase Plan shares | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Total potential common shares excluded from calculation | 491 | 368 | 506 |
Convertible preferred stock | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Total potential common shares excluded from calculation | 0 | 0 | 674 |
2014 Debentures | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Total potential common shares excluded from calculation | 7,298 | 10,332 | 10,332 |
Term B Loan | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Total potential common shares excluded from calculation | 1,887 | 1,887 | 1,887 |
DETAILS_OF_CERTAIN_FINANCIAL_S2
DETAILS OF CERTAIN FINANCIAL STATEMENT COMPONENTS Schedule of Inventory (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | ||
Inventory: | ' | ' |
Raw materials | $1,840 | $1,220 |
Work-in-process | 4,503 | 3,652 |
Finished goods | 6,449 | 5,820 |
Total | $12,792 | $10,692 |
DETAILS_OF_CERTAIN_FINANCIAL_S3
DETAILS OF CERTAIN FINANCIAL STATEMENT COMPONENTS Schedule of Property, Plant and Equipment (Details) (USD $) | 12 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property, plant and equipment, gross | $70,970,000 | $90,773,000 | ' |
Less: Accumulated depreciation | -68,112,000 | -87,666,000 | ' |
Total | 2,858,000 | 3,107,000 | ' |
Depreciation expense | 1,700,000 | 2,000,000 | 2,600,000 |
Cost of property, plant and equipment disposed of | 21,100,000 | 3,800,000 | ' |
Accumulated depreciation of property, plant and equipment disposed of | 21,000,000 | 3,700,000 | ' |
Machinery and equipment | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property, plant and equipment, gross | 61,236,000 | 77,865,000 | ' |
Furniture and fixtures | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property, plant and equipment, gross | 505,000 | 704,000 | ' |
Computer equipment | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property, plant and equipment, gross | 7,356,000 | 8,736,000 | ' |
Leasehold improvements | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property, plant and equipment, gross | 1,829,000 | 3,163,000 | ' |
Construction in progress | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Property, plant and equipment, gross | $44,000 | $305,000 | ' |
DETAILS_OF_CERTAIN_FINANCIAL_S4
DETAILS OF CERTAIN FINANCIAL STATEMENT COMPONENTS Schedulee of Intangible Assets (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Intangible Assets: | ' | ' |
Total | $1,476 | $1,170 |
Weighted average useful life | '6 years 5 months 23 days | '6 years 10 months 6 days |
Fiscal Year Maturity | ' | ' |
2015 | 372 | ' |
2016 | 350 | ' |
2017 | 245 | ' |
2018 | 204 | ' |
2019 | 168 | ' |
Thereafter | 137 | ' |
Licensing Agreements | ' | ' |
Intangible Assets: | ' | ' |
Intellectual property and technology license agreements | 5,490 | 4,824 |
Less: Accumulated amortization | -4,014 | -3,654 |
Total | $1,476 | $1,170 |
DETAILS_OF_CERTAIN_FINANCIAL_S5
DETAILS OF CERTAIN FINANCIAL STATEMENT COMPONENTS Schedule of Other Assets (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | ||
Other Assets: | ' | ' |
Non-current portion of deferred tax asset, net | $1,288 | $1,273 |
Restricted cash | 1,500 | 1,500 |
Debt issue costs, net | 8 | 287 |
Other | 308 | 365 |
Total | $3,104 | $3,425 |
DETAILS_OF_CERTAIN_FINANCIAL_S6
DETAILS OF CERTAIN FINANCIAL STATEMENT COMPONENTS Schedule of Accrued Expenses and Other Current Liabilities (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | ||
Accrued Expenses and Other Current Liabilities: | ' | ' |
Accrued software license agreements | $3,335 | $3,526 |
Accrued vacation | 2,580 | 2,442 |
Accrued wages and benefits | 2,730 | 1,729 |
Interest payable | 1,645 | 2,196 |
Accrued income taxes | 408 | 332 |
Accrued warranty liability | 52 | 60 |
Accrued other | 1,722 | 1,960 |
Accrued expenses and other current liabilities | $12,472 | $12,245 |
DEBT_Schedule_of_Longterm_Debt
DEBT Schedule of Long-term Debt Instruments (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | ||
Debt Instrument [Line Items] | ' | ' |
Long-term debt, net | $16,417 | $16,366 |
Total debt, net | 49,144 | 60,750 |
Notes Payable to Banks | Term A Loan 1 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, net | 7,791 | 7,919 |
Interest rate | 9.00% | 10.50% |
Convertible Notes Payable | Term B Loan 1 | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, net | 8,626 | 8,444 |
Interest rate | 9.00% | 8.00% |
Capital Lease Obligations | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, net | 0 | 3 |
Convertible Debt | 2014 Debentures | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Convertible Subordinated Debt | $32,727 | $44,384 |
Interest rate | 8.00% | 8.00% |
DEBT_Schedule_of_Outstanding_D
DEBT Schedule of Outstanding Debt (Details) (USD $) | Sep. 30, 2014 |
In Thousands, except Per Share data, unless otherwise specified | |
Notes Payable to Banks | Term A Loan 1 [Member] | ' |
Debt Instrument [Line Items] | ' |
Principal | $7,857 |
Unamortized debt discount | -66 |
Carrying value | 7,791 |
Annual effective interest rate | 9.50% |
Convertible Notes Payable | Term B Loan 1 | ' |
Debt Instrument [Line Items] | ' |
Principal | 9,342 |
Unamortized debt discount | -716 |
Carrying value | 8,626 |
Annual effective interest rate | 13.50% |
Conversion price per common share | $4.95 |
Convertible Debt | 2014 Debentures | ' |
Debt Instrument [Line Items] | ' |
Principal | 32,843 |
Unamortized debt discount | -116 |
Carrying value | $32,727 |
Annual effective interest rate | 12.20% |
Conversion price per common share | $4.50 |
DEBT_Narrative_Details
DEBT (Narrative) (Details) (USD $) | 3 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 12 Months Ended | ||||||||||||||
Share data in Millions, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Nov. 05, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Oct. 30, 2012 | Sep. 30, 2014 | Nov. 05, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Nov. 05, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Oct. 30, 2014 |
Convertible Debt | Term A Loan 1 [Member] | Term A Loan 1 [Member] | Term B Loan, convertible, bearing interest at 9.0% and 8.0% as of September 30, 2014 and 2013, respectively, due August 2016 | Term B Loan, convertible, bearing interest at 9.0% and 8.0% as of September 30, 2014 and 2013, respectively, due August 2016 | 2014 Debentures | 2014 Debentures | 2014 Debentures | 2014 Debentures | Term A and B Loans | Term A and B Loans | Term A and B Loans | Term A and B Loans | Subsequent Event | ||||||
Notes Payable to Banks | Notes Payable to Banks | Convertible Notes Payable | Convertible Notes Payable | Convertible Debt | Convertible Debt | Convertible Debt | Convertible Debt | After October 30, 2014 but prior to October 30, 2015 | On or after October 30, 2015 | 2014 Debentures | |||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate | ' | ' | ' | ' | ' | ' | 9.00% | 10.50% | 9.00% | 8.00% | ' | 8.00% | ' | 8.00% | 9.00% | ' | ' | ' | ' |
Prepayment fee, percent | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.00% | 2.00% | ' |
Unrestricted cash balance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $8,000,000 | ' | ' | ' | ' |
Quarterly revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' |
Conversion price per common share | ' | ' | ' | ' | ' | ' | ' | ' | $4.95 | ' | ' | $4.50 | ' | ' | ' | ' | ' | ' | ' |
Conversion of outstanding principal that would convert to common stock (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 1.9 | ' | ' | 7.3 | ' | ' | ' | ' | ' | ' | ' |
Consent fee | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300,000 | ' | ' | ' |
Repurchase amount | ' | ' | ' | ' | ' | 13,700,000 | ' | ' | ' | ' | ' | ' | 13,700,000 | ' | ' | ' | ' | ' | ' |
Prepayment repurchase percentage | ' | ' | ' | ' | ' | 107.00% | ' | ' | ' | ' | ' | ' | 107.00% | ' | ' | ' | ' | ' | ' |
Gains (Losses) on Extinguishment of Debt | -1,594,000 | ' | -1,594,000 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term Debt, Gross | ' | ' | ' | ' | ' | ' | 7,857,000 | ' | 9,342,000 | ' | ' | 32,843,000 | ' | ' | ' | ' | ' | ' | ' |
Cash restricted under credit agreement | ' | ' | -687,000 | 0 | 0 | ' | ' | ' | ' | ' | ' | 700,000 | ' | ' | ' | ' | ' | ' | ' |
Current portion of debt, net | ' | ' | 32,727,000 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 32,800,000 |
Gain from final valuation | ' | 803,000 | 0 | 803,000 | 4,897,000 | ' | ' | ' | ' | ' | 800,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Reclassification of compound embedded derivative liability to additional paid-in capital | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,100,000 | ' | ' | ' | ' | ' | ' | ' | ' |
DEBT_Schedule_of_Maturities_of
DEBT Schedule of Maturities of Long-term Debt (Details) (USD $) | Sep. 30, 2014 |
In Thousands, unless otherwise specified | |
Debt Disclosure [Abstract] | ' |
2015 | $32,843 |
2016 | 17,199 |
Total | $50,042 |
FAIR_VALUE_MEASUREMENTS_Schedu
FAIR VALUE MEASUREMENTS Schedule of the fair value of the loans and compound embedded derivative (Details) (USD $) | 12 Months Ended | |||||||||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Term B Loan | Convertible Debt | Estimate of Fair Value Measurement [Member] | Estimate of Fair Value Measurement [Member] | Estimate of Fair Value Measurement [Member] | Estimate of Fair Value Measurement [Member] | Estimate of Fair Value Measurement [Member] | Estimate of Fair Value Measurement [Member] | Reported Value Measurement [Member] | Reported Value Measurement [Member] | Reported Value Measurement [Member] | Reported Value Measurement [Member] | Reported Value Measurement [Member] | Reported Value Measurement [Member] | |
Term A Loan | Term A Loan | Term B Loan | Term B Loan | Convertible Debt | Convertible Debt | Term A Loan | Term A Loan | Term B Loan | Term B Loan | Convertible Debt | Convertible Debt | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Discount rate | 4.00% | 3.30% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term Debt, Fair Value | ' | ' | $8,755 | $8,165 | $10,245 | $9,781 | $33,040 | $49,282 | $7,791 | $7,919 | $8,626 | $8,444 | $32,727 | $44,384 |
STOCKHOLDERS_EQUITY_Narrative_
STOCKHOLDERS' EQUITY (Narrative) (Details) (USD $) | 1 Months Ended | ||||
Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Common stock, shares authorized | ' | ' | ' | 250,000,000 | 250,000,000 |
Common stock, par value (in dollars per share) | ' | ' | ' | $0.01 | $0.01 |
Preferred stock, shares authorized | ' | ' | ' | 10,000,000 | 10,000,000 |
Preferred stock, par value (in dollars per share) | ' | ' | ' | $0.01 | $0.01 |
Value of stock issued | $26,600,000 | $37,400,000 | $17,100,000 | ' | ' |
Offering costs | $2,100,000 | $2,800,000 | $1,600,000 | ' | ' |
Stock issued (in shares) | 8,582,076 | 18,720,000 | 10,651,280 | ' | ' |
Price per share (in dollars per share) | $3.35 | $2.15 | $1.75 | ' | ' |
Stock Options | ' | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Common stock, shares reserved for future issuance | ' | ' | ' | 8,400,000 | ' |
Employee Stock Purchase Plan shares | ' | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Common stock, shares reserved for future issuance | ' | ' | ' | 3,000,000 | ' |
Conversion of debt | ' | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Common stock, shares reserved for future issuance | ' | ' | ' | 9,200,000 | ' |
STOCK_BASED_COMPENSATION_Compe
STOCK BASED COMPENSATION Compensation costs related to the stock-based compensations plans (Details) (USD $) | 12 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Contractual life | '10 years | ' | ' |
Number of shares available for future grant | 1,900,000 | ' | ' |
Share limit, current year (in shares) | 1.5 | ' | ' |
Unrecognized stock-based compensation expense | $6,000,000 | ' | ' |
In-the-money stock options exercisable | $3.60 | $3.04 | $2.44 |
Total stock-based compensation expense | 6,075,000 | 4,396,000 | 4,442,000 |
Cost of revenues | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Total stock-based compensation expense | 823,000 | 617,000 | 567,000 |
Engineering, research and development | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Total stock-based compensation expense | 2,248,000 | 1,616,000 | 1,530,000 |
Selling, general and administrative | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Total stock-based compensation expense | $3,004,000 | $2,163,000 | $2,345,000 |
Stock Options And Restricted Stock | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Estimated forfeiture rate | 4.20% | ' | ' |
Stock Options | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Weighted average period over which the unearned stock-based compensation is expected to be recognized | '1 year 2 months 12 days | ' | ' |
Outstanding restricted stock units | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Weighted average period over which the unearned stock-based compensation is expected to be recognized | '1 year 7 months 6 days | ' | ' |
STOCK_BASED_COMPENSATION_Activ
STOCK BASED COMPENSATION Activity under all stock option plans (Details) (USD $) | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ' | ' | ' | ' |
Options outstanding, Shares, Beginning balance | 2,089,000 | 1,813,000 | 1,699,000 | ' |
Options outstanding, Weighted average exercise price, Beginning balance | $13.43 | $16.57 | $29.77 | ' |
Options outstanding,Weighted average remaining contractual life (in years), Beginning balance | '7 years | '6 years 8 months 1 day | '6 years 7 months 10 days | '6 years 4 months 13 days |
Options outstanding, Aggregate intrinsic value, Beginninging balance | $591 | $2 | $0 | ' |
Shares, Granted | 1,014,000 | 464,000 | 401,000 | ' |
Weighted average exercise price, Granted | $2.53 | $2.12 | $2.55 | ' |
Shares, Exercised | -52,000 | -9,000 | -6,000 | ' |
Weighted average exercise price, Exercised | $2.36 | $2.24 | $2.54 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | 64 | 6 | 3 | ' |
Shares, Cancelled or expired | -111,000 | -179,000 | -281,000 | ' |
Weighted average exercise price, Cancelled or expired | $76.55 | $16.52 | $76.87 | ' |
Options outstanding, Shares, Ending balance | 2,940,000 | 2,089,000 | 1,813,000 | 1,699,000 |
Options outstanding, Weighted average exercise price, Ending balance | $7.46 | $13.43 | $16.57 | $29.77 |
Options outstanding, Weighted average remaining contractual life (in years), Ending balance | '7 years | '6 years 8 months 1 day | '6 years 7 months 10 days | '6 years 4 months 13 days |
Options outstanding, Aggregate intrinsic value, Ending balance | 2,059 | 591 | 2 | 0 |
Options exercisable, Shares, Ending balance | 1,633,000 | ' | ' | ' |
Options exercisable, Weighted average exercise price, Ending balance | $11.36 | ' | ' | ' |
Options exercisable, Weighted average remaining contractual life (in years), Ending balance | '5 years 7 months 17 days | ' | ' | ' |
Aggregate intrinsic value, Options exercisbale | $668 | ' | ' | ' |
In-the-money stock options exercisable | $3.60 | $3.04 | $2.44 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, In The Money Stock Options That Were Exercisable | 600,000 | ' | ' | ' |
STOCK_BASED_COMPENSATION_Summa
STOCK BASED COMPENSATION Summary of assumptions used to value stock options granted in connection with stock incentives (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 10, 2013 |
Stock Options | Stock Options | Stock Options | Executive Officer [Member] | ||||
Stock Options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $64 | $6 | $3 | ' | ' | ' | ' |
Expected life (in years) | ' | ' | ' | '5 years 9 months 15 days | '5 years 7 months 28 days | '6 years 7 months 10 days | '1 year 3 months 18 days |
Expected volatility, Weighted-average | ' | ' | ' | 81.50% | 82.00% | 86.90% | 80.00% |
Expected volatility, range, minimum | ' | ' | ' | 79.50% | 79.80% | 82.20% | ' |
Expected volatility, range, maximum | ' | ' | ' | 81.60% | 82.10% | 87.10% | ' |
Expected dividend | ' | ' | ' | 0.00% | 0.00% | 0.00% | 0.00% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | ' | ' | ' | ' | ' | ' | 2.79% |
Risk-free interest rate, range, minimum | ' | ' | ' | 1.70% | 0.09% | 1.00% | ' |
Risk-free interest rate, range, maximum | ' | ' | ' | 1.90% | 1.70% | 1.30% | ' |
Weighted average fair value at the date of grant | ' | ' | ' | $1.75 | $1.44 | $1.80 | $1.86 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | ' | ' | ' | ' | ' | ' | 500,000 |
Weighted average exercise price, Granted | $2.53 | $2.12 | $2.55 | ' | ' | ' | $2.53 |
Share-based Compensation Arrangement by Share-based Payment Award, Threshold Consecutive Trading Days | ' | ' | ' | ' | ' | ' | '30 days |
STOCK_BASED_COMPENSATION_Sched
STOCK BASED COMPENSATION Schedule of stock option by exercise price range (Details) (USD $) | 12 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 |
$2.10 - $145.40 | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Range of Exercise Price, Lower Limit (in dollars per share) | $2.10 |
Range of Exercise Price, Upper Limit (in dollars per share) | $145 |
Number of Outstanding Options (in shares) | 2,940 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | '7 years |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $7.46 |
Number of Exercisable Options (in shares) | 1,633 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $11.36 |
$2.10 - $2.26 | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Range of Exercise Price, Lower Limit (in dollars per share) | $2.10 |
Range of Exercise Price, Upper Limit (in dollars per share) | $2.26 |
Number of Outstanding Options (in shares) | 424 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | '8 years 5 months 4 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $2.11 |
Number of Exercisable Options (in shares) | 194 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $2.10 |
2.53 | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Range of Exercise Price, Lower Limit (in dollars per share) | $2.53 |
Range of Exercise Price, Upper Limit (in dollars per share) | $2.53 |
Number of Outstanding Options (in shares) | 987 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | '9 years 2 months 8 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $2.53 |
Number of Exercisable Options (in shares) | 116 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $2.53 |
2.54 - 4.36 | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Range of Exercise Price, Lower Limit (in dollars per share) | $2.54 |
Range of Exercise Price, Upper Limit (in dollars per share) | $4.36 |
Number of Outstanding Options (in shares) | 743 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | '6 years 8 months 26 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $3.45 |
Number of Exercisable Options (in shares) | 542 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $3.49 |
4.60 - 47.20 | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Range of Exercise Price, Lower Limit (in dollars per share) | $4.60 |
Range of Exercise Price, Upper Limit (in dollars per share) | $47.20 |
Number of Outstanding Options (in shares) | 589 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | '4 years 9 months 29 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $7.84 |
Number of Exercisable Options (in shares) | 583 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $7.87 |
48.00 - 145.40 | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Range of Exercise Price, Lower Limit (in dollars per share) | $48 |
Range of Exercise Price, Upper Limit (in dollars per share) | $145 |
Number of Outstanding Options (in shares) | 197 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | '5 months 4 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $57.56 |
Number of Exercisable Options (in shares) | 198 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $57.56 |
STOCK_BASED_COMPENSATION_Summa1
STOCK BASED COMPENSATION Summary of restricted stock unit activity (Details) (Restricted Stock Units (RSUs), USD $) | 12 Months Ended | |||
In Millions, except Share data in Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value | $3.20 | $3.30 | $2.90 | ' |
Impact of retaining common stock from employees upon vesting of restricted shares and restricted stock units to cover income tax withholding | $1.30 | $0.60 | $0.60 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | ' | ' | ' | ' |
Restricted stock units, Restricted Stock Units, Beginning balance | 2,021 | 1,686 | 1,296 | ' |
Restricted stock units, Weighted Average Grant-Date Fair Value per Share, Beginning balance | $2.65 | $3.49 | $4.66 | ' |
Restricted stock units, Weighted average remaining contractual life (in years), Beginning balance | '11 months 15 days | '1 year 1 month 17 days | '1 year 1 month 2 days | '1 year 4 months 17 days |
Aggregate intrinsic value, Beginning balance, Restricted stock | $6,143,000 | $4,113,000 | $3,823,000 | ' |
Restricted Stock Units, Awarded | 1,600 | 1,527 | 1,258 | ' |
Weighted Average Grant-Date Fair Value per Share, Awarded | $2.62 | $2.12 | $2.57 | ' |
Restricted Stock Units, Released | -1,183 | -1,045 | -721 | ' |
Weighted Average Grant-Date Fair Value per Share, Released | $2.69 | $3.19 | $3.99 | ' |
Restricted Stock Units, Forfeited | -110 | -147 | -147 | ' |
Weighted Average Grant-Date Fair Value per Share, Forfeited | $2.60 | $2.88 | $3.48 | ' |
Restricted stock units, Restricted Stock Units, Ending balance | 2,328 | 2,021 | 1,686 | 1,296 |
Restricted stock units, Weighted Average Grant-Date Fair Value per Share, Ending balance | $2.61 | $2.65 | $3.49 | $4.66 |
Restricted stock units, Weighted average remaining contractual life (in years), Ending balance | '11 months 15 days | '1 year 1 month 17 days | '1 year 1 month 2 days | '1 year 4 months 17 days |
Aggregate intrinsic value, Ending balance, Restricted stock | $8,380,000 | $6,143,000 | $4,113,000 | $3,823,000 |
Maximum | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Vesting period | '4 years | ' | ' | ' |
Non-employee Director | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Vesting percentage after one year | 33.33% | ' | ' | ' |
Vesting percentage after two years | 33.33% | ' | ' | ' |
Vesting percentage after three years | 33.33% | ' | ' | ' |
Annual award vesting percentage | 100.00% | ' | ' | ' |
STOCK_BASED_COMPENSATION_Emplo
STOCK BASED COMPENSATION Employee Stock Purchase Plan (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Stock compensation recognized | $6,075 | $4,396 | $4,442 |
Employee Stock Purchase Plan shares | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Maximum annual contributions per employee, percent | 15.00% | ' | ' |
Call option for percent of share of stock | 85.00% | ' | ' |
ESPP shares issued | 721,900 | 952,516 | 821,470 |
Per share price of ESPP shares issued | $2.50 | $1.75 | $2.11 |
Total number of common stock shares reserved for issuance | 3,000,000 | ' | ' |
Stock compensation recognized | $600 | $600 | $600 |
Expected life (in years) | '6 months | '6 months | '6 months |
Expected volatility, range, minimum | 37.10% | 47.60% | 40.40% |
Expected volatility, range, maximum | 50.30% | 49.80% | 48.40% |
Expected dividend rate | 0.00% | 0.00% | 0.00% |
Risk-free interest rate, range, minimum | 0.07% | 0.11% | 0.09% |
Risk-free interest rate, range, maximum | 0.08% | 0.14% | 0.20% |
INCOME_TAXES_Schedule_of_the_C
INCOME TAXES Schedule of the Components of Loss From Continuing Operations Before (Benefit) Provision for Income Taxes (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Domestic | ($18,871) | ($23,646) | ($3,406) |
Foreign | 1,137 | 1,020 | 2,120 |
Loss before income tax expense (benefit) | ($17,734) | ($22,626) | ($1,286) |
INCOME_TAXES_Schedule_of_Compo
INCOME TAXES Schedule of Components of Income Tax Expense (Benefit) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Current: | ' | ' | ' |
Federal | ($27) | $0 | ($188) |
State | 71 | 54 | 41 |
Foreign | 312 | -758 | 1,510 |
Total current | 356 | -704 | 1,363 |
Deferred: | ' | ' | ' |
Federal | 0 | 0 | 0 |
State | 0 | 0 | 0 |
Foreign | -15 | 156 | -1,537 |
Total deferred | -15 | 156 | -1,537 |
Total income tax expense (benefit): | $341 | ($548) | ($174) |
INCOME_TAXES_Schedule_of_Effec
INCOME TAXES Schedule of Effective Income Tax Rate Reconciliation (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Effective Income Tax Rate, Continuing Operations, Tax Rate Reconciliation: | ' | ' | ' |
Federal income tax benefit at statutory rate | ($6,030) | ($7,693) | ($437) |
Federal income tax benefit at statutory rate, Percent | 34.00% | 34.00% | 34.00% |
State tax benefit net of federal benefit | -242 | -536 | -13 |
State tax benefit net of federal benefit, Percent | 1.40% | 2.40% | 1.00% |
Foreign taxes | -68 | -1,156 | 1,102 |
Foreign taxes, Percent | 0.40% | 5.10% | -85.70% |
Tax credits | 0 | -438 | -1,230 |
Tax credits, Percent | 0.00% | 1.90% | 95.60% |
Nondeductible expenses | 650 | 771 | 1,015 |
Nondeductible expenses, Percent | -3.70% | -3.40% | -78.90% |
Other | 0 | 87 | -100 |
Other, Percent | 0.00% | -0.40% | 7.90% |
Change in valuation allowance | 6,131 | 7,164 | -1,147 |
Change in valuation allowance, Percent | -34.60% | -31.70% | 89.20% |
Rate change/other adjustments on deferred taxes | -100 | 1,253 | 636 |
Rate change/other adjustments on deferred taxes, Percent | 0.60% | -5.50% | -49.50% |
Total income tax expense (benefit): | $341 | ($548) | ($174) |
Income tax (benefit) expense, Percent | -1.90% | 2.40% | 13.60% |
INCOME_TAXES_Schedule_of_Defer
INCOME TAXES Schedule of Deferred Tax Assets and Liabilities (Details) (USD $) | 1 Months Ended | 12 Months Ended | |||||||
Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |||
Deferred Tax Assets: | ' | ' | ' | ' | ' | ' | ' | ||
Net operating loss carryforward | ' | ' | ' | $31,418,000 | $27,110,000 | ' | ' | ||
Research and development tax credits | ' | ' | ' | 10,165,000 | 10,574,000 | ' | ' | ||
Deferred income | ' | ' | ' | 2,724,000 | 2,664,000 | ' | ' | ||
Stock based compensation | ' | ' | ' | 3,354,000 | [1] | 12,313,000 | [1] | ' | ' |
Fixed assets and intangible property | ' | ' | ' | 7,293,000 | 7,955,000 | ' | ' | ||
Inventories | ' | ' | ' | 1,714,000 | 2,256,000 | ' | ' | ||
Allowances and reserves | ' | ' | ' | 9,436,000 | 9,277,000 | ' | ' | ||
Foreign tax credit/AMT credit | ' | ' | ' | 88,000 | 88,000 | ' | ' | ||
Other | ' | ' | ' | 3,000 | 11,000 | ' | ' | ||
Total deferred tax assets | ' | ' | ' | 66,195,000 | 72,248,000 | ' | ' | ||
Deferred Tax Liabilities: | ' | ' | ' | ' | ' | ' | ' | ||
Debt amortization | ' | ' | ' | -11,000 | -2,065,000 | ' | ' | ||
Total deferred tax liabilities | ' | ' | ' | -11,000 | -2,065,000 | ' | ' | ||
Net deferred income taxes | ' | ' | ' | 66,184,000 | 70,183,000 | ' | ' | ||
Valuation allowance | ' | ' | ' | -64,788,000 | [1] | -68,802,000 | [1] | ' | ' |
Net deferred tax assets | ' | ' | ' | 1,396,000 | 1,381,000 | ' | ' | ||
Stock issued (in shares) | 8,582,076 | 18,720,000 | 10,651,280 | ' | ' | ' | ' | ||
Percent of shareholder change to limit the net loss carryforwards | ' | ' | 5.00% | ' | ' | ' | ' | ||
Change in shareholder owner percentage points to limit the net loss carryforwards | ' | ' | 0.50% | ' | ' | ' | ' | ||
Rolling period over which shareholder basis points must be over to limit the net loss carryforwards | ' | ' | '3 years | ' | ' | ' | ' | ||
Federal NOL subject to annual limitation | ' | ' | 25,400,000 | ' | ' | ' | ' | ||
Federal NOL annual limit | ' | ' | 1,400,000 | ' | ' | ' | ' | ||
Decrease in valuation allowance | ' | ' | ' | -4,000,000 | ' | ' | ' | ||
Unrecognized tax benefits | ' | ' | ' | -10,325,000 | -10,615,000 | -10,822,000 | -10,215,000 | ||
Stock Based Compensation | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Tax Liabilities: | ' | ' | ' | ' | ' | ' | ' | ||
Overstatement of Deferred Tax Asset | ' | ' | ' | ' | 9,100,000 | ' | ' | ||
Adjustment to deferred tax assets | ' | ' | ' | 9,100,000 | ' | ' | ' | ||
Overstatement (Understatement) of Deferred Tax Asset Valuation Allowance | ' | ' | ' | ' | 9,100,000 | 9,400,000 | 8,100,000 | ||
Decrease in valuation allowance | ' | ' | ' | 9,100,000 | ' | ' | ' | ||
Federal and State Jurisdiction | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Tax Liabilities: | ' | ' | ' | ' | ' | ' | ' | ||
Valuation allowance | ' | ' | ' | -55,000,000 | ' | ' | ' | ||
Internal Revenue Service (IRS) | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Tax Liabilities: | ' | ' | ' | ' | ' | ' | ' | ||
Net operating losses | ' | ' | ' | 53,900,000 | ' | ' | ' | ||
State and Local Jurisdiction | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Tax Assets: | ' | ' | ' | ' | ' | ' | ' | ||
Research and development tax credits | ' | ' | ' | 10,200,000 | ' | ' | ' | ||
Deferred Tax Liabilities: | ' | ' | ' | ' | ' | ' | ' | ||
Net operating losses | ' | ' | ' | 27,300,000 | ' | ' | ' | ||
Foreign Tax Authority | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Tax Liabilities: | ' | ' | ' | ' | ' | ' | ' | ||
Valuation allowance | ' | ' | ' | -9,800,000 | ' | ' | ' | ||
Net operating losses | ' | ' | ' | 119,200,000 | ' | ' | ' | ||
Accrued liabilities and other current liabilities | State and Local Jurisdiction | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Tax Liabilities: | ' | ' | ' | ' | ' | ' | ' | ||
Unrecognized tax benefits | ' | ' | ' | -200,000 | -200,000 | ' | ' | ||
Research Tax Credit Carryforward | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Tax Liabilities: | ' | ' | ' | ' | ' | ' | ' | ||
Unrecognized tax benefits | ' | ' | ' | -10,100,000 | -10,400,000 | ' | ' | ||
Research Tax Credit Carryforward | State and Local Jurisdiction | ' | ' | ' | ' | ' | ' | ' | ||
Deferred Tax Liabilities: | ' | ' | ' | ' | ' | ' | ' | ||
Decrease in gross unrecognized tax benefits | ' | ' | ' | $300,000 | ' | ' | ' | ||
[1] | The Company identified an overstatement of its previously disclosed deferred tax asset for stock based compensation and the related valuation allowance in the amount of $9.1 million as of September 30, 2013. The Company evaluated the impact of this error in accordance with SAB No. 99 and concluded that it was not material. Further, the Company maintains a full valuation allowance on all of its U.S. and state deferred tax assets, and there was no impact on the Company's financial position and results of operations. As of September 30, 2014 the Company recorded an adjustment of $9.1 million to decrease both the deferred tax asset for stock based compensation and the related valuation allowance. The previously reported amounts have not been revised. |
INCOME_TAXES_Reconciliation_of
INCOME TAXES Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefit (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ' | ' | ' |
Beginning balance | ($10,615) | ($10,822) | ($10,215) |
Gross decreases - tax positions in prior period | 290 | 354 | 0 |
Gross increases - current-period tax positions | 0 | -147 | -47 |
Gross increases - tax positions in prior period | 0 | 0 | -560 |
Ending balance | ($10,325) | ($10,615) | ($10,822) |
SIGNIFICANT_CUSTOMERS_CONCENTR2
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION Schedule of Revenue by Major Customers by Reporting Segments (Details) | 12 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' |
Number of Operating Segments | 1 | ' | ' |
Nu Horizons Electronics | Customer Concentration Risk | Sales | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' |
Concentration Risk, Percentage | ' | ' | 13.50% |
WPG | Customer Concentration Risk | Sales | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' |
Concentration Risk, Percentage | 23.80% | 17.70% | 10.70% |
SIGNIFICANT_CUSTOMERS_CONCENTR3
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION Net Revenues By Geographic Area (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | $28,671 | $27,151 | $25,592 | $27,083 | $26,875 | $26,418 | $24,753 | $25,727 | $108,497 | $103,773 | $119,483 |
United States | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | ' | ' | ' | ' | ' | ' | ' | ' | 25,284 | 28,454 | 41,559 |
China, including Hong Kong | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | ' | ' | ' | ' | ' | ' | ' | ' | 31,653 | 32,545 | 30,786 |
Taiwan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | ' | ' | ' | ' | ' | ' | ' | ' | 23,649 | 17,430 | 15,871 |
Other Asia Pacific | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | ' | ' | ' | ' | ' | ' | ' | ' | 14,258 | 11,479 | 15,603 |
Europe, Middle East and Africa | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | ' | ' | ' | ' | ' | ' | ' | ' | $13,653 | $13,865 | $15,664 |
SIGNIFICANT_CUSTOMERS_CONCENTR4
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION Product Revenues by the Three Product Lines (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
product_line | |||||||||||
Revenue from External Customer [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of product lines | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' |
Product revenues | $27,007 | $26,012 | $24,869 | $24,863 | $26,455 | $26,285 | $24,689 | $23,905 | $102,751 | $101,334 | $109,920 |
Ethernet switching | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue from External Customer [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | ' | ' | ' | ' | ' | ' | ' | ' | 50,914 | 38,675 | 32,607 |
Connectivity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue from External Customer [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | ' | ' | ' | ' | ' | ' | ' | ' | 41,017 | 42,885 | 52,933 |
Transport processing | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue from External Customer [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | ' | ' | ' | ' | ' | ' | ' | ' | $10,820 | $19,774 | $24,380 |
SIGNIFICANT_CUSTOMERS_CONCENTR5
SIGNIFICANT CUSTOMERS, CONCENTRATION OF CREDIT RISK AND GEOGRAPHIC INFORMATION Schedule of Lovg-lived Assets (excluding intangible assets) by Country (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Long-lived assets (excluding intangible assts) | $2,858 | $3,107 |
Located within the United States | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Long-lived assets (excluding intangible assts) | 1,628 | 1,615 |
Located outside the United States | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Long-lived assets (excluding intangible assts) | $1,230 | $1,492 |
RETIREMENT_SAVINGS_PLAN_Narrat
RETIREMENT SAVINGS PLAN (Narrative) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Defined Contribution Plan [Line Items] | ' | ' | ' |
Employer contibution | $0.20 | ' | ' |
Requisite service period | 25.00% | ' | ' |
Deferred Compensation Arrangement with Individual, Requisite Service Period | 'P4Y | ' | ' |
Foreign Subsidiary | ' | ' | ' |
Defined Contribution Plan [Line Items] | ' | ' | ' |
Employer contibution | $0.90 | $0.80 | $0.70 |
COMMITMENTS_Schedule_of_Future
COMMITMENTS Schedule of Future Minimum Lease Payments and Software Licenses (Details) (USD $) | 12 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |
Commitments and Contingencies Disclosure [Abstract] | ' | ' | ' |
Rent expense | $3,000,000 | $3,500,000 | $3,000,000 |
Operating leases | ' | ' | ' |
Operating leases, 2015 | 2,002,000 | ' | ' |
Operating leases, 2016 | 651,000 | ' | ' |
Operating leases, 2017 | 169,000 | ' | ' |
Operating leases, 2018 | 60,000 | ' | ' |
Operating leases, 2019 | 0 | ' | ' |
Operating leases, Thereafter | 0 | ' | ' |
Operating leases, Total | 2,882,000 | ' | ' |
Software licenses | ' | ' | ' |
Software licenses, 2015 | 8,084,000 | ' | ' |
Software licenses, 2016 | 4,555,000 | ' | ' |
Software licenses, 2017 | 4,275,000 | ' | ' |
Software licenses, 2018 | 4,175,000 | ' | ' |
Software licenses, 2019 | 0 | ' | ' |
Software licenses, Thereafter | 0 | ' | ' |
Software licenses, Total | 21,089,000 | ' | ' |
Total | ' | ' | ' |
Operating leases and Software licenses, 2015 | 10,086,000 | ' | ' |
Operating leases and Software licenses, 2016 | 5,206,000 | ' | ' |
Operating leases and Software licenses, 2017 | 4,444,000 | ' | ' |
Operating leases and Software licenses, 2018 | 4,235,000 | ' | ' |
Operating leases and Software licenses, 2019 | 0 | ' | ' |
Operating leases and Software licenses, Thereafter | 0 | ' | ' |
Operating leases and Software licenses, Total | $23,971,000 | ' | ' |
SUBSEQUENT_EVENT_Subsequent_Ev
SUBSEQUENT EVENT Subsequent Event (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 | Oct. 30, 2014 |
In Thousands, unless otherwise specified | 2014 Debentures | ||
Subsequent Event | |||
Debt Instrument [Line Items] | ' | ' | ' |
Current portion of debt, net | $32,727 | $0 | $32,800 |
QUARTERLY_FINANCIAL_DATA_UNAUD1
QUARTERLY FINANCIAL DATA (UNAUDITED) Schedule of Quarterly Financial Information (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||
Share data in Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Nov. 05, 2013 |
Convertible Debt | ||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gains (Losses) on Extinguishment of Debt | ' | ' | ' | ($1,594,000) | ' | ' | ' | ' | ($1,594,000) | $0 | $0 | ' |
Repurchase amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13,700,000 |
Prepayment repurchase percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 107.00% |
Gain from final valuation | ' | ' | ' | ' | ' | ' | ' | 803,000 | 0 | 803,000 | 4,897,000 | ' |
Net revenues: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | 27,007,000 | 26,012,000 | 24,869,000 | 24,863,000 | 26,455,000 | 26,285,000 | 24,689,000 | 23,905,000 | 102,751,000 | 101,334,000 | 109,920,000 | ' |
Intellectual property revenues | 1,664,000 | 1,139,000 | 723,000 | 2,220,000 | 420,000 | 133,000 | 64,000 | 1,822,000 | 5,746,000 | 2,439,000 | 9,563,000 | ' |
Net revenues | 28,671,000 | 27,151,000 | 25,592,000 | 27,083,000 | 26,875,000 | 26,418,000 | 24,753,000 | 25,727,000 | 108,497,000 | 103,773,000 | 119,483,000 | ' |
Cost of product revenues | 10,571,000 | 12,254,000 | 10,979,000 | 10,676,000 | 12,753,000 | 11,666,000 | 11,369,000 | 10,975,000 | 44,480,000 | 46,763,000 | 46,407,000 | ' |
Loss from operations | -654,000 | -2,527,000 | -4,379,000 | -2,214,000 | -3,492,000 | -4,291,000 | -3,872,000 | -3,819,000 | -9,774,000 | -15,474,000 | 1,635,000 | ' |
Net loss | ($2,485,000) | ($4,388,000) | ($5,831,000) | ($5,371,000) | ($5,765,000) | ($6,434,000) | ($4,847,000) | ($5,032,000) | ($18,075,000) | ($22,078,000) | ($1,112,000) | ' |
Net loss per share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic and diluted (in dollars per sahre) | ($0.04) | ($0.07) | ($0.10) | ($0.09) | ($0.10) | ($0.17) | ($0.13) | ($0.18) | ($0.30) | ($0.55) | ($0.04) | ' |
Weighted average shares outstanding: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic and diluted (in shares) | 67,580 | 59,965 | 58,327 | 57,610 | 57,254 | 38,630 | 37,215 | 28,059 | 60,887 | 40,311 | 25,121 | ' |
SCHEDULE_II_Valuation_and_Qual1
SCHEDULE II - Valuation and Qualifying Accounts (Details) (USD $) | 12 Months Ended | |||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
Allowance for doubtful accounts | Allowance for doubtful accounts | Allowance for doubtful accounts | Valuation allowance | Valuation allowance | Valuation allowance | Stock Based Compensation | Stock Based Compensation | Stock Based Compensation | Stock Based Compensation | |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Overstatement (Understatement) of Deferred Tax Asset Valuation Allowance | ' | ' | ' | ' | ' | ' | ' | $9,100,000 | $9,400,000 | $8,100,000 |
Deferred Tax Asset, Change in Amount | ' | ' | ' | ' | ' | ' | -9,100,000 | ' | ' | ' |
Movement in Valuation Allowances and Reserves [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at Beginning of Year | 0 | 258,000 | 2,212,000 | 68,802,000 | 102,408,000 | 92,671,000 | ' | ' | ' | ' |
Charged to Cost and Expenses | 0 | -142,000 | -1,954,000 | 6,287,000 | -487,000 | -1,147,000 | ' | ' | ' | ' |
Charged to Other Accounts | 0 | 0 | 0 | 0 | 0 | 0 | ' | ' | ' | ' |
Deductions/Write-offs | 0 | -116,000 | 0 | -10,335,000 | -33,119,000 | 10,884,000 | ' | ' | ' | ' |
Balance at End of Year | $0 | $0 | $258,000 | $64,754,000 | $68,802,000 | $102,408,000 | ' | ' | ' | ' |