Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Sep. 30, 2017 | Oct. 27, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | VIAVI SOLUTIONS INC. | |
Entity Central Index Key | 912,093 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 227,421,473 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Sep. 30, 2017 | Oct. 01, 2016 | |
Revenues: | ||
Product revenue | $ 171.9 | $ 188.3 |
Service revenue | 23.3 | 22.5 |
Total net revenues | 195.2 | 210.8 |
Cost of revenues: | ||
Product cost of revenues | 63.5 | 68.6 |
Service cost of revenues | 11.4 | 13.3 |
Amortization of acquired technologies | 4.1 | 3.8 |
Total cost of revenues | 79 | 85.7 |
Gross profit | 116.2 | 125.1 |
Operating expenses: | ||
Research and development | 29.1 | 36.1 |
Selling, general and administrative | 72.5 | 75.4 |
Amortization of other intangibles | 3.1 | 3.5 |
Restructuring and related charges | 1.5 | 0 |
Total operating expenses | 106.2 | 115 |
Income from operations | 10 | 10.1 |
Interest and other income, net | 0.2 | 1.3 |
Gain on sale of investments | 0 | 81.5 |
Interest expense | (12.5) | (9.2) |
(Loss) income before taxes | (2.3) | 83.7 |
Provision for income taxes | 2.5 | 5.7 |
Net (loss) income | $ (4.8) | $ 78 |
Net (loss) income per share: | ||
Basic (in dollars per share) | $ (0.02) | $ 0.34 |
Diluted (in dollars per share) | $ (0.02) | $ 0.33 |
Shares used in per-share calculation - basic (in shares) | 228.1 | 232.4 |
Shares used in per-share calculation - diluted (in shares) | 228.1 | 236.8 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2017 | Oct. 01, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net (loss) income | $ (4.8) | $ 78 |
Other comprehensive income: | ||
Net change in cumulative translation adjustment, net of tax | 10.2 | 3.4 |
Net change in available-for-sale investments, net of tax: | ||
Unrealized holding gain arising during period | 0 | 84.4 |
Less: reclassification adjustments included in net (loss) income | 0 | (81.5) |
Net change in defined benefit obligation, net of tax: | ||
Amortization of actuarial losses | 0.4 | 0.5 |
Net change in accumulated other comprehensive loss | 10.6 | 6.8 |
Comprehensive income | $ 5.8 | $ 84.8 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2017 | Jul. 01, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 792.7 | $ 1,004.4 |
Short-term investments | 430.9 | 432.2 |
Restricted cash | 7.5 | 11.2 |
Accounts receivable, net | 121.2 | 120.4 |
Inventories, net | 68.9 | 48 |
Prepayments and other current assets | 47.9 | 50.8 |
Total current assets | 1,469.1 | 1,667 |
Property, plant and equipment, net | 140.2 | 136.9 |
Goodwill | 169.4 | 151.6 |
Intangibles, net | 50.8 | 31.1 |
Deferred income taxes | 113.7 | 109.5 |
Other non-current assets | 14.7 | 14.4 |
Total assets | 1,957.9 | 2,110.5 |
Current liabilities: | ||
Accounts payable | 40.5 | 32.6 |
Accrued payroll and related expenses | 45.7 | 43.8 |
Deferred revenue | 54.3 | 60.2 |
Accrued expenses | 29.1 | 30.8 |
Current portion of long-term debt | 443.3 | 0 |
Other current liabilities | 54.1 | 61.4 |
Total current liabilities | 667 | 228.8 |
Long-term debt, net of current portion | 358.8 | 931.4 |
Other non-current liabilities | 165.8 | 163.9 |
Commitments and contingencies (Note 16) | ||
Stockholders’ equity: | ||
Preferred Stock, $0.001 par value; 1 million shares authorized; 1 share at September 30, 2017 and July 1, 2017, issued and outstanding | 0 | 0 |
Common Stock, $0.001 par value; 1 billion shares authorized; 228 million shares at September 30, 2017 and 228 million shares at July 1, 2017, issued and outstanding | 0.2 | 0.2 |
Additional paid-in capital | 70,168.4 | 70,184.4 |
Accumulated deficit | (69,320.5) | (69,305.8) |
Accumulated other comprehensive loss | (81.8) | (92.4) |
Total stockholders’ equity | 766.3 | 786.4 |
Total liabilities and stockholders’ equity | $ 1,957.9 | $ 2,110.5 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2017 | Jul. 01, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred Stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred Stock, shares issued (in shares) | 1 | 1 |
Preferred Stock, shares outstanding (in shares) | 1 | 1 |
Common Stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common Stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common Stock, shares issued (in shares) | 228,000,000 | 228,000,000 |
Common Stock, shares outstanding (in shares) | 228,000,000 | 228,000,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2017 | Oct. 01, 2016 | |
OPERATING ACTIVITIES: | ||
Net (loss) income | $ (4.8) | $ 78 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation expense | 8.4 | 7.9 |
Amortization of acquired technologies and other intangibles | 7.2 | 7.3 |
Stock-based compensation | 7.5 | 8.7 |
Amortization of debt issuance costs and accretion of debt discount | 9.8 | 7.5 |
Amortization of discount and premium on investments, net | (0.1) | 0.1 |
Gain on sale of investments | 0 | (81.5) |
Loss on disposal of assets | 0.8 | 0.5 |
Loss on extinguishment of debt | 3.6 | 0 |
Other | 0.7 | 0.2 |
Changes in operating assets and liabilities, net of impact of acquisitions of businesses: | ||
Accounts receivable | 3.8 | (17.2) |
Inventories | (11) | 3 |
Other current and non-currents assets | 3.4 | (8.1) |
Accounts payable | 4.5 | (10.2) |
Income taxes payable | (5.3) | 1.2 |
Deferred revenue, current and non-current | (8.3) | (12.2) |
Deferred taxes, net | (0.1) | (0.4) |
Accrued payroll and related expenses | (1.7) | (2.7) |
Accrued expenses and other current and non-current liabilities | (7.4) | 32.8 |
Net cash provided by operating activities | 11 | 14.9 |
INVESTING ACTIVITIES: | ||
Purchases of available-for-sale investments | (150.4) | (233.7) |
Maturities of available-for-sale investments | 140.6 | 86.8 |
Sales of available-for-sale investments | 11.2 | 157.8 |
Changes in restricted cash | 4.2 | 0.9 |
Capital expenditures | (8.4) | (11.6) |
Proceeds from the sale of assets | 0.9 | 1.4 |
Acquisition of business, net of cash acquired | (55.3) | 0 |
Net cash (used in) provided by investing activities | (57.2) | 1.6 |
FINANCING ACTIVITIES: | ||
Repurchase and retirement of common stock | (9.2) | (25.5) |
Withholding tax payment on vesting of restricted stock awards | 5.2 | 4.6 |
Repurchase and redemption of convertible debt | (162) | 0 |
Payment of financing obligations | (0.7) | (0.2) |
Proceeds from exercise of employee stock options and employee stock purchase plan | 2.5 | 3.3 |
Net cash used in financing activities | (174.6) | (27) |
Effect of exchange rates on cash and cash equivalents | 9.1 | 1.9 |
Net decrease in cash and cash equivalents | (211.7) | (8.6) |
Cash and cash equivalents at the beginning of the period | 1,004.4 | 482.9 |
Cash and cash equivalents at the end of the period | $ 792.7 | $ 474.3 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Note 1. Basis of Presentation The financial information for Viavi Solutions Inc. (“Viavi” also referred to as “the Company”, “we”, “our” and “us”) as of September 30, 2017 and for the three months ended September 30, 2017 and October 1, 2016 is unaudited, and includes all normal and recurring adjustments Company management (“Management”) considers necessary for a fair statement of the financial information set forth herein, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, such information does not include all of the information and footnotes required by U.S. GAAP for annual consolidated financial statements. For further information, please refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended July 1, 2017 . The balance sheet as of July 1, 2017 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The results for the three months ended September 30, 2017 and October 1, 2016 may not be indicative of results for the fiscal year ending June 30, 2018 or any future periods. Fiscal Years The Company utilizes a 52 - 53 week fiscal year ending on the Saturday closest to June 30th. The Company’s fiscal 2018 is a 52 -week year ending on June 30, 2018 . The Company’s fiscal 2017 was a 52 -week year ending on July 1, 2017 . Principles of Consolidation The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the Company and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated. Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements, the reported amount of net revenues and expenses and the disclosure of commitments and contingencies during the reporting periods. The Company bases estimates on historical experience and on various assumptions about the future that are believed to be reasonable based on available information. The Company’s reported financial positions or results of operations may be materially different under changed conditions or when using different estimates and assumptions, particularly with respect to significant accounting policies. If estimates or assumptions differ from actual results, subsequent periods are adjusted to reflect more current information. |
Recently Issued Accounting Pron
Recently Issued Accounting Pronouncements | 3 Months Ended |
Sep. 30, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recently Issued Accounting Pronouncements | Note 2. Recently Issued Accounting Pronouncements In May 2017, the Financial Accounting Standards Board (“FASB”) issued guidance that clarifies the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under the relevant authoritative guidance. The guidance is to be applied prospectively, and is effective for the Company in the first quarter of fiscal 2019. Early adoption is permitted. The Company does not anticipate the adoption of this guidance to have a material impact on its consolidated financial statements, absent any award(s) modified on or after adoption date. In November 2016, the FASB issued guidance that will require that the amounts generally described as restricted cash and restricted cash equivalents would be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period amounts shown on the statement of cash flows. The new guidance also requires certain disclosures to supplement the statement of cash flows. The guidance is effective for the Company in the first quarter of fiscal 2019. Other than changes in the presentation within the statements of cash flows and additional required disclosures, the adoption of this new accounting guidance will not have an impact on the consolidated financial statements. In October 2016, the FASB issued guidance that requires entities to recognize at the transaction date the income tax consequences of intra-entity transfer of an asset other than inventory. The guidance is effective for the Company in the first quarter of fiscal 2019. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. In June 2016, the FASB issued guidance that changes the accounting for recognizing impairments of financial assets. Under the new guidance, credit losses for certain types of financial instruments will be estimated based on expected losses. The new guidance also modifies the impairment models for available-for-sale debt securities and for purchased financial assets with credit deterioration since their origination. The guidance is effective for the Company in the first quarter of fiscal 2021 and earlier adoption is permitted. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. In February 2016, the FASB issued guidance regarding both operating and financing leases, requiring lessees to recognize on their balance sheets “right-of-use assets” and corresponding lease liabilities, measured on a discounted basis over the lease term. Virtually all leases will be subject to this treatment except leases that meet the definition of a “short-term lease.” The guidance requires a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The guidance is effective for the Company in the first quarter of fiscal 2020. While the Company is not yet in a position to assess the full impact of the application of the new guidance, the Company expects adoption of this guidance will materially increase the assets and liabilities recorded on its Consolidated Balance Sheets. In May 2014, the FASB issued new authoritative guidance related to revenue recognition from contracts with customers. This new guidance will replace current U.S. GAAP guidance on this topic and eliminate industry-specific guidance. The new guidance provides a unified model to determine when and how revenue is recognized. The core principle of the new guidance is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. This new guidance allows for either full retrospective adoption or modified retrospective adoption. The FASB deferred the effective date for this new guidance by one year to December 15, 2017 for annual reporting periods beginning after such date.The Company will adopt the guidance in the first quarter of fiscal 2019 using the full retrospective method, reflecting the application of the new standard in each prior reporting period. In preparation for the implementation and adoption of the new guidance, the Company has established a cross-functional team and implementation plan to identify processes, systems and internal controls over financial reporting impacted by the new guidance. The implementation plan includes comparison of the Company’s historical accounting policies and practices to the requirements of the new guidance, and identifying differences from applying the requirements of the new guidance to the Company’s contracts, consolidated financial statements and related disclosures. While the Company’s assessment of the potential impacts of the new guidance is not yet complete, initially the Company believes the most significant impact on the accounting for contracts with customers will be for certain arrangements that include sales of software solutions bundled with post-contract support (PCS) and/or services, where VSOE has not been established for the PCS and/or the services. Due to lack of VSOE under the current guidance, the Company defers recognition of any revenue attributable to such arrangements until the services lacking VSOE are complete. Such revenue is then recognized ratably over the remaining support term. The requirement to have VSOE for undelivered elements to enable the separation of the revenue for delivered software is eliminated under the new guidance and the Company will be required to allocate total contract revenue to each element (referred to as a distinct performance obligation under the new standard) based on either an established or estimated standalone selling price. Accordingly, a portion of the revenue for these types of contracts with customers will be recognized when the software or software solution is transferred to the customer. Dependent on contract-specific terms, the Company expects the actual revenue recognition treatment and timing will vary under the new guidance for some of these arrangements. The Company will continue to evaluate the impact of this new guidance on its consolidated financial statements and related disclosures. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 3. Earnings Per Share The following table sets forth the computation of basic and diluted net (loss) income per share ( in millions, except per share data ): Three Months Ended September 30, 2017 October 1, 2016 Numerator: Net (loss) income $ (4.8 ) $ 78.0 Denominator: Weighted-average number of common shares outstanding Basic 228.1 232.4 Effect of dilutive securities from stock-based benefit plans — 4.4 Diluted 228.1 236.8 Net (loss) income per share: Basic $ (0.02 ) $ 0.34 Diluted $ (0.02 ) $ 0.33 The following table sets forth the weighted-average potentially dilutive securities excluded from the computation of the diluted net (loss) income per share because their effect would have been anti-dilutive ( in millions ): Three Months Ended September 30, 2017 (1) (2) October 1, 2016 (1) Stock options and ESPP 1.7 1.6 Restricted Stock Units 8.0 2.0 Total potentially dilutive securities 9.7 3.6 (1) The Company’s 0.625% Senior Convertible Notes due 2033 are not included in the table above. The par amount of convertible notes is payable in cash equal to the principal amount of the notes plus any accrued and unpaid interest and then the “in-the-money” conversion benefit feature at the conversion price above $11.28 per share is payable in cash, shares of the Company’s common stock or a combination of both at the Company’s election. Refer to “ Note 10. Debt ” for more details. (2) The Company’s 1.00% Senior Convertible Notes due 2024 are not included in the table above. The par amount of convertible notes is payable in cash equal to the principal amount of the notes plus any accrued and unpaid interest and then the “in-the-money” conversion benefit feature at the conversion price above $13.22 per share is payable in cash, shares of the Company’s common stock or a combination of both at the Company’s election. Refer to “ Note 10. Debt ” for more details. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | Note 4. Accumulated Other Comprehensive Loss The Company’s accumulated other comprehensive loss consists of the accumulated net unrealized gains and losses on available-for-sale investments, foreign currency translation adjustments and change in unrealized components of defined benefit obligations. For the three months ended September 30, 2017 the changes in accumulated other comprehensive loss by component net of tax were as follows ( in millions ): Unrealized gains (losses) on available-for sale investments Foreign currency translation adjustments Change in unrealized components of defined benefit obligations, net of tax (1) Total Beginning balance as of July 1, 2017 $ (5.3 ) $ (65.3 ) $ (21.8 ) $ (92.4 ) Other comprehensive income before reclassification — 10.2 — 10.2 Amounts reclassified out of accumulated other comprehensive loss — — 0.4 0.4 Net current-period other comprehensive income — 10.2 0.4 10.6 Ending balance as of September 30, 2017 $ (5.3 ) $ (55.1 ) $ (21.4 ) $ (81.8 ) (1) The amount reclassified out of accumulated other comprehensive loss represents the amortization of actuarial losses included as a component of cost of revenues, research and development (“R&D”) and selling, general and administrative expense (“SG&A”) in the Consolidated Statement of Operations for the three months ended September 30, 2017 . There was no tax impact for the three months ended September 30, 2017 . Refer to “ Note 15. Employee Pension and Other Benefit Plans ” for more details on the computation of net periodic cost for pension plans. |
Mergers and Acquisitions
Mergers and Acquisitions | 3 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Mergers and Acquisitions | Note 5. Mergers and Acquisitions On August 9, 2017, the Company completed the acquisition of Trilithic, Inc. (“Trilithic”), a privately-held provider of electronic test and measurement equipment for telecommunications service providers. The Company acquired all outstanding shares of Trilithic for $55.5 million in cash, subject to working capital adjustments. The Trilithic acquisition is being integrated into the Company’s Network Enablement (“NE”) segment. The Company accounted for the transaction in accordance with the authoritative guidance on business combinations. Therefore, the tangible and intangible assets acquired and liabilities assumed were recorded at fair value on the acquisition date, and acquisition-related costs totaling $0.9 million were included in selling, general, and administrative expenses in the Company’s Consolidated Statement of Operations during the three months ended September 30, 2017. The purchase price was allocated as follows (in millions) : Net tangible assets acquired $ 11.8 Intangible assets acquired: Developed technology 15.5 Customer relationships 11.0 Other 0.3 Goodwill 16.9 Total purchase price $ 55.5 The amounts above are considered preliminary and are subject to change once the Company receives additional information it believes is necessary to finalize its determination of the fair value of certain assets acquired in the acquisition. The following table summarizes the components of the tangible assets acquired at fair value (in millions) : Cash $ 0.2 Accounts receivable 3.2 Inventory 10.1 Property and equipment 1.2 Accounts payable (1.7 ) Other liabilities, net of other assets (1.2 ) Net tangible assets acquired $ 11.8 Acquired intangible assets are classified as Level 3 assets for which fair value is derived from valuation based on inputs that are unobservable and significant to the overall fair value measurement. The fair value of acquired developed technology, customer relationships, and other intangible assets was determined based on an income approach using the discounted cash flow method. The intangible assets are being amortized over their estimated useful lives that range from three to five years for the acquired developed technology and customer relationships. The goodwill arising from this acquisition is primarily attributed to sales of future products and services and the assembled workforce of Trilithic. Goodwill has been assigned to the NE segment and is not deductible for tax purposes. Goodwill is not being amortized but is reviewed annually for impairment or more frequently if impairment indicators arise, in accordance with authoritative guidance. Trilithic’s results of operations have been included in the Company’s consolidated financial statements subsequent to the date of acquisition. Pro forma results of operations have not been presented because the effect of the acquisition was not material to prior period financial statements. |
Balance Sheet and Other Details
Balance Sheet and Other Details | 3 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet and Other Details | Note 6. Balance Sheet and Other Details Accounts receivable reserves and allowances The components of accounts receivable reserves and allowances were as follows ( in millions ): September 30, 2017 July 1, 2017 Allowance for doubtful accounts $ 1.7 $ 1.6 Sales allowance 2.0 3.4 Total accounts receivable reserves and allowances $ 3.7 $ 5.0 The activities and balances for allowance for doubtful accounts are as follows (in millions): July 1, 2017 Acquisition of Trilithic (1) Charged to Costs and Expenses Adjustments September 30, 2017 Allowance for doubtful accounts $ 1.6 0.1 — — $ 1.7 (1) See “ Note 5. Mergers and Acquisitions ” of the Notes to Consolidated Financial Statements for detail of acquisition. Inventories, net The components of inventories, net were as follows ( in millions ): September 30, 2017 July 1, 2017 Finished goods $ 33.6 $ 24.9 Work in process 14.4 10.3 Raw materials 20.9 12.8 Inventories, net $ 68.9 $ 48.0 Prepayments and other current assets The components of prepayments and other current assets were as follo ws ( in millions ): September 30, 2017 July 1, 2017 Prepayments $ 8.9 $ 8.3 Other current assets 39.0 42.5 Prepayments and other current assets $ 47.9 $ 50.8 Other current liabilities The components of other current liabilities were as follows ( in millions ): September 30, 2017 July 1, 2017 Customer prepayments 35.5 35.2 Restructuring accrual 6.8 8.8 Income tax payable 1.5 3.3 Warranty accrual 3.4 2.9 VAT liabilities 1.4 2.2 Deferred compensation plan 2.1 2.0 Other 3.4 7.0 Other current liabilities $ 54.1 $ 61.4 Other non-current liabilities The components of other non-current liabilities were as follo ws ( in millions ): September 30, 2017 July 1, 2017 Pension and post-employment benefits $ 102.3 $ 99.4 Financing obligation 27.7 27.8 Long-term deferred revenue 12.6 14.0 Other 23.2 22.7 Other non-current liabilities $ 165.8 $ 163.9 |
Investments, Forward Contracts
Investments, Forward Contracts and Fair Value Measurements | 3 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Investments, Forward Contracts and Fair Value Measurements | Note 7. Investments, Forward Contracts and Fair Value Measurements Available-For-Sale Investments The Company’s investments in marketable debt securities were primarily classified as available-for-sale securities. As of September 30, 2017 , the Company’s available-for-sale securities were as follows ( in millions ): Amortized Cost/ Carrying Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale debt securities: U.S. treasuries $ 88.5 $ — $ (0.1 ) $ 88.4 U.S. agencies 13.9 — (0.1 ) 13.8 Municipal bonds and sovereign debt instruments 4.4 — — 4.4 Asset-backed securities 62.7 — (0.4 ) 62.3 Corporate securities 330.4 0.1 (0.1 ) 330.4 Total available-for-sale debt securities $ 499.9 $ 0.1 $ (0.7 ) $ 499.3 The Company generally classifies debt securities as cash equivalents, short-term investments or other non-current assets based on the stated maturities; however, certain securities with stated maturities of longer than twelve months which are highly liquid and available to support current operations are also classified as short-term investments. As of September 30, 2017 , of the total estimated fair value, $69.8 million was classified as cash equivalents, $428.8 million was classified as short-term investments and $0.7 million was classified as other non-current assets. In addition to the amounts presented above, as of September 30, 2017 , the Company’s short-term investments classified as trading securities related to the deferred compensation plan were $2.1 million , of which $0.4 million was invested in debt securities, $0.3 million was invested in money market instruments and funds and $1.4 million was invested in equity securities. Trading securities are reported at fair value, with the unrealized gains or losses resulting from changes in fair value recognized in Interest and other income, net. During the three months ended September 30, 2017 and October 1, 2016 , the Company recorded no other-than-temporary impairment charges in each respective period. As of September 30, 2017 , contractual maturities of the Company’s debt securities classified as available-for-sale securities were as follows ( in millions ): Amortized Cost/ Carrying Cost Estimated Fair Value Amounts maturing in less than 1 year $ 384.9 $ 384.8 Amounts maturing in 1 - 5 years 114.0 113.8 Amounts maturing in more than 5 years 1.0 0.7 Total debt available-for-sale securities $ 499.9 $ 499.3 As of July 1, 2017 , the Company’s available-for-sale securities were as follows ( in millions ): Amortized Cost/ Carrying Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale securities: U.S. treasuries $ 56.8 $ — $ (0.1 ) $ 56.7 U.S. agencies 45.0 — (0.1 ) 44.9 Municipal bonds and sovereign debt instruments 4.4 — — 4.4 Asset-backed securities 71.5 — (0.4 ) 71.1 Corporate securities 326.1 0.1 (0.2 ) 326.0 Certificates of deposit 6.0 — — 6.0 Total available-for-sale securities $ 509.8 $ 0.1 $ (0.8 ) $ 509.1 As of July 1, 2017 , of the total estimated fair value, $78.2 million was classified as cash equivalents, $430.2 million was classified as short-term investments and $0.7 million was classified as other non-current assets. In addition to the amounts presented above, as of July 1, 2017 , the Company’s short-term investments classified as trading securities, related to the deferred compensation plan, were $2.0 million , of which $0.5 million was invested in debt securities, $0.3 million was invested in money market instruments and funds and $1.2 million was invested in equity securities. Trading securities are reported at fair value, with the unrealized gains or losses resulting from changes in fair value recognized in Interest and other income, net. Fair Value Measurements Assets measured at fair value as of September 30, 2017 and July 1, 2017 are summarized below ( in millions ): Fair value measurement as of Fair value measurement as of September 30, 2017 July 1, 2017 Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Assets: Debt available-for-sale securities U.S. treasuries $ 88.4 $ 88.4 $ — $ 56.7 $ 56.7 $ — U.S. agencies 13.8 — 13.8 44.9 — 44.9 Municipal bonds and sovereign debt instruments 4.4 — 4.4 4.4 — 4.4 Asset-backed securities 62.3 — 62.3 71.1 — 71.1 Corporate securities 330.4 — 330.4 326.0 — 326.0 Certificate of deposits — — — 6.0 — 6.0 Total debt available-for-sale securities 499.3 88.4 410.9 509.1 56.7 452.4 Money market funds 530.5 530.5 — 726.4 726.4 — Trading securities 2.1 2.1 — 2.0 2.0 — Foreign currency forward contracts 4.0 — 4.0 7.3 — 7.3 Total assets (1) $ 1,035.9 $ 621.0 $ 414.9 $ 1,244.8 $ 785.1 $ 459.7 Liability: Foreign currency forward contracts 0.9 — 0.9 1.3 — 1.3 Total liabilities (2) $ 0.9 $ — $ 0.9 $ 1.3 $ — $ 1.3 (1) $ 588.7 million in cash and cash equivalents, $430.9 million in short-term investments, $7.3 million in restricted cash, $ 4.0 million in prepayments and other current assets, and $5.0 million in other non-current assets on the Company’s Consolidated Balance Sheets as of September 30, 2017 . $789.2 million in cash and cash equivalents, $432.2 million in short-term investments, $11.0 million in restricted cash, $7.3 million in prepayments and other current assets, and $5.1 million in other non-current assets on the Company’s Consolidated Balance Sheets as of July 1, 2017 . (2) $ 0.9 million in other current liabilities on the Company’s Consolidated Balance Sheets as of September 30, 2017 . $1.3 million in other current liabilities on the Company’s Consolidated Balance Sheets as of July 1, 2017 . Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. There is an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the assumptions about the factors that market participants would use in valuing the asset or liability. The Company’s cash and investment instruments are classified within Level 1 or Level 2 of the fair value hierarchy based on quoted prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. • Level 1 includes financial instruments for which quoted market prices for identical instruments are available in active markets. Level 1 assets of the Company include money market funds, U.S. Treasury securities and marketable equity securities as they are traded with sufficient volume and frequency of transactions. • Level 2 includes financial instruments for which the valuations are based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. Level 2 instruments of the Company generally include certain U.S. and foreign government and agency securities, commercial paper, corporate and municipal bonds and notes, asset-backed securities, certificates of deposit, and foreign currency forward contracts. To estimate their fair value, the Company utilizes pricing models based on market data. The significant inputs for the valuation model usually include benchmark yields, reported trades, broker and dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data, and industry and economic events. • Level 3 includes financial instruments for which fair value is derived from valuation based on inputs that are unobservable and significant to the overall fair value measurement. As of September 30, 2017 and July 1, 2017 , the Company did not hold any Level 3 investment securities. Non-Designated Foreign Currency Forward Contracts The Company has foreign subsidiaries that operate and sell the Company’s products in various markets around the world. As a result, the Company is exposed to foreign exchange risks. The Company utilizes foreign exchange forward contracts to manage foreign currency risk associated with foreign currency denominated monetary assets and liabilities, primarily certain short-term intercompany receivables and payables, and to reduce the volatility of earnings and cash flows related to foreign-currency transactions. The Company does not use these foreign currency forward contracts for trading purposes. As of September 30, 2017 , the Company had forward contracts that were effectively closed but not settled with the counterparties by quarter end. Therefore, the fair value of these contracts of $4.0 million and $0.9 million is reflected as prepayments and other current assets and other current liabilities in the Consolidated Balance Sheets as of September 30, 2017 , respectively. As of July 1, 2017, the fair value of these contracts of $7.3 million and $1.3 million is reflected as prepayments and other current assets and other current liabilities, respectively. The forward contracts outstanding and not effectively closed, with a term of less than 120 days, were transacted near quarter end; therefore, the fair value of the contracts is not significant. As of September 30, 2017 and July 1, 2017 , the notional amounts of the forward contracts the Company held to purchase foreign currencies were $135.2 million and $134.3 million , respectively, and the notional amounts of forward contracts the Company held to sell foreign currencies were $25.9 million and $25.4 million , respectively. The change in the fair value of foreign currency forward contracts is recorded as gain or loss in the Company’s Consolidated Statements of Operations as a component of Interest and other income, net. The cash flows related to the settlement of foreign currency forward contracts are classified as operating activities. The gains on foreign exchange forward contracts were $3.1 million and $0.3 million for the three months ended September 30, 2017 and October 1, 2016 , respectively. |
Goodwill
Goodwill | 3 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Note 8. Goodwill The following table presents the changes in goodwill allocated to the Company’s reportable segments (in millions) : Network Enablement Optical Security and Performance Products Total Balance as of July 1, 2017 $ 143.3 $ 8.3 $ 151.6 Goodwill - Trilithic (1) 16.9 — 16.9 Currency translation adjustments 0.9 — 0.9 Balance as of September 30, 2017 $ 161.1 $ 8.3 $ 169.4 (1) See “ Note 5. Mergers and Acquisitions ” of the Notes to Consolidated Financial Statements for detail. The Company reviews goodwill for impairment during the fourth quarter of each fiscal year, or more frequently if events or circumstances indicate that an impairment loss may have occurred. In the fourth quarter of fiscal 2017 , the Company completed the annual impairment test of goodwill with no goodwill impairments for the NE and OSP reporting units. There were no events or changes in circumstances which triggered an impairment review during the three months ended September 30, 2017 . |
Acquired Developed Technology a
Acquired Developed Technology and Other Intangibles | 3 Months Ended |
Sep. 30, 2017 | |
Acquired Developed Technology and Other Intangibles | |
Acquired Developed Technology and Other Intangibles | Note 9. Acquired Developed Technology and Other Intangibles The following tables present details of the Company’s acquired developed technology, customer relationships and other intangibles ( in millions ): As of September 30, 2017 Gross Carrying Amount Accumulated Amortization Net Acquired developed technology $ 386.7 $ (357.6 ) $ 29.1 Customer relationships 106.4 (84.8 ) 21.6 Other (1) 10.2 (10.1 ) 0.1 Total intangibles $ 503.3 $ (452.5 ) $ 50.8 As of July 1, 2017 Gross Carrying Amount Accumulated Amortization Net Acquired developed technology $ 369.3 $ (352.0 ) $ 17.3 Customer relationships 94.9 (81.3 ) 13.6 Other (1) 9.9 (9.7 ) 0.2 Total intangibles $ 474.1 $ (443.0 ) $ 31.1 (1) Other intangibles consist of customer backlog, non-competition agreements, patents, proprietary know-how and trade secrets, trademarks and trade names. The following table presents the amortization recorded relating to acquired developed technology, customer relationships and other intangibles ( in millions ): Three Months Ended September 30, 2017 October 1, 2016 Cost of revenues $ 4.1 $ 3.8 Operating expenses 3.1 3.5 Total amortization of intangible assets $ 7.2 $ 7.3 Based on the carrying amount of acquired developed technology, customer relationships and other intangibles as of September 30, 2017 , and assuming no future impairment of the underlying assets, the estimated future amortization is as follows ( in millions ): Fiscal Years Remainder of 2018 $ 19.8 2019 16.3 2020 8.4 2021 4.1 2022 2.0 Thereafter 0.2 Total amortization $ 50.8 The acquired developed technology, customer relationships and other intangibles balance are adjusted quarterly to record the effect of currency translation adjustments. |
Debt
Debt | 3 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Debt | Note 10. Debt As of September 30, 2017 and July 1, 2017 , the Company’s short-term debt and long-term debt on the Consolidated Balance Sheets represented the carrying amount of the liability component, net of unamortized debt discounts and issuance cost, of the Senior Convertible Notes as discussed below. The following table presents the carrying amounts of the liability and equity components ( in millions ): September 30, 2017 July 1, 2017 Principal amount of 0.625% Senior Convertible Notes $ 463.5 $ 610.0 Principal amount of 1.00% Senior Convertible Notes 460.0 460.0 Unamortized discount of liability component (113.5 ) (129.4 ) Unamortized debt issuance cost (7.9 ) (9.2 ) Carrying amount of liability component $ 802.1 $ 931.4 Current portion of long-term debt 443.3 — Long-term debt, net of current portion $ 358.8 $ 931.4 Carrying amount of equity component (1) $ 210.4 $ 229.7 (1) Included in additional paid-in-capital on the Consolidated Balance Sheets. The Company was in compliance with all debt covenants as of September 30, 2017 and July 1, 2017 . 1.00% Senior Convertible Notes (“2024 Notes”) On March 3, 2017, the Company issued $400 million aggregate principal amount of 1.00% Senior Convertible Notes due 2024 in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. On March 22, 2017, the Company issued an additional $60 million upon exercise of the over-allotment option of the initial purchasers. The total proceeds from the 2024 Notes amounted to $451.1 million after issuance costs. The 2024 Notes are an unsecured obligation of the Company and bear interest at an annual rate of 1.00% payable in cash semi-annually in arrears on March 1 and September 1 of each year. The 2024 Notes mature on March 1, 2024 unless earlier converted or repurchased. The carrying value of the liability component at issuance was calculated as the present value of its cash flows using a discount rate of 4.8% based on the 7 -year swap rate plus credit spread as of the issuance date. Based on quoted market prices as of September 30, 2017 and July 1, 2017 , the fair value of the 2024 Notes was approximately $463.1 million and $481.7 million , respectively. The 2024 Notes are classified within Level 2 as they are not actively traded in markets. 0.625% Senior Convertible Notes (“2033 Notes”) On August 21, 2013, the Company issued $650.0 million aggregate principal amount of 0.625% Senior Convertible Notes due 2033 in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The proceeds from the 2033 Notes amounted to $636.3 million after issuance costs. The 2033 Notes are an unsecured obligation of the Company and bear interest at an annual rate of 0.625% payable in cash semi-annually in arrears on February 15 and August 15 of each year. The 2033 Notes mature on August 15, 2033 unless earlier converted, redeemed or repurchased. The carrying value of the liability component at issuance was calculated as the present value of its cash flows using a discount rate of 5.4% based on the 5 -year swap rate plus credit spread as of the issuance date. Holders of the 2033 Notes may require the Company to purchase all or a portion of the 2033 Notes on each of August 15, 2018, August 15, 2023 and August 15, 2028, or upon the occurrence of a fundamental change, in each case, at a price equal to 100% of the principal amount of the 2033 Notes to be purchased, plus accrued and unpaid interest to, but excluding the purchase date. As of September 30, 2017, the expected remaining term of the 2033 Notes is 0.9 years and thus was classified as current portion of long-term debt. During the first quarter of fiscal 2018, the Company repurchased $146.5 million aggregate principal amount of the notes for $162.0 million in cash. In connection with the repurchase, a loss on extinguishment of $3.6 million was recognized in interest and other income, net in compliance with the authoritative guidance. After giving effect to the repurchase, the total amount of 0.625% Senior Convertible Notes outstanding as of September 30, 2017 was $463.5 million . Based on quoted market prices as of September 30, 2017 and July 1, 2017 , the fair value of the 2033 Notes was approximately $488.0 million and $676.1 million , respectively. The 2033 Notes are classified within Level 2 as they are not actively traded in markets. Interest Expense The following table presents the interest expense for contractual interest, amortization of debt issuance cost and accretion of debt discount ( in millions ): Three Months Ended September 30, 2017 October 1, 2016 Interest expense-contractual interest $ 2.0 $ 1.0 Amortization of debt issuance cost 0.7 0.6 Accretion of debt discount 9.1 6.9 |
Restructuring and Related Charg
Restructuring and Related Charges | 3 Months Ended |
Sep. 30, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Charges | Note 11. Restructuring and Related Charges The Company has initiated various strategic restructuring events primarily intended to reduce its costs, consolidate its operations, rationalize the manufacturing of its products and align its businesses in response to market conditions. As of September 30, 2017 and July 1, 2017 , the Company’s total restructuring accrual was $9.1 million and $11.0 million , respectively. During the three months ended September 30, 2017 and October 1, 2016 , the Company recorded restructuring and related charges of $1.5 million and $0.0 million , respectively. The Company’s restructuring charges can include severance and benefit costs to eliminate a specified number of positions, facilities and equipment costs to vacate facilities and consolidate operations, and lease termination costs. The timing of associated cash payments is dependent upon the type of restructuring charge and can extend over multiple periods. Summary of Restructuring Plans The adjustments to the accrued restructuring expenses related to all of the Company’s restructuring plans described below for the three months ended September 30, 2017 were as follows (in millions) : Balance Three Months Ended September 30, 2017 Charges (Benefits) Cash Settlements Non-cash Settlements and Other Adjustments Balance September 30, 2017 Fiscal 2017 Plan OSP Restructuring Plan (1) $ 0.8 $ — $ — $ — $ 0.8 Focused NSE Restructuring Plan (1) (2) 4.9 1.2 (3.1 ) 0.4 3.4 Other Plans (2) — 0.4 (0.2 ) 0.1 0.3 Fiscal 2016 Plan NE, SE and Shared Services Agile Restructuring Plan (1) 0.2 (0.1 ) (0.1 ) — — NE and SE Agile Restructuring Plan (1) 0.4 — — — 0.4 Plans Prior to Fiscal 2016 NE Product Strategy Restructuring Plan (1) 0.9 — (0.1 ) — 0.8 NE Lease Restructuring Plan (2) 2.6 — (0.3 ) — 2.3 Other Plans (1)(2) 1.2 — (0.1 ) — 1.1 Total $ 11.0 $ 1.5 $ (3.9 ) $ 0.5 $ 9.1 (1) Plan type includes workforce reduction cost. (2) Plan type includes lease exit cost. As of September 30, 2017 and July 1, 2017 , $2.3 million and $2.2 million , respectively, of our restructuring liability was long-term in nature and included as a component of Other non-current liabilities, with the remaining short-term portion included as a component of Other current liabilities on the Consolidated Balance Sheets. Fiscal 2017 Plans OSP Restructuring Plan During the fourth quarter of fiscal 2017, Management approved a plan within the OSP business segment to realign its operations and exit from the printed security business. As a result approximately 30 employees in manufacturing and SG&A functions located in the United States were impacted. Payments related to the severance and benefits accrual are expected to be paid by the end of the third quarter of fiscal 2018. Focused NSE Restructuring Plan Q3FY17 and Q2FY17 During the third and second quarters of fiscal 2017, Management approved a plan within the NE and SE business segments as part of Viavi’s continued strategy to improve profitability in the Company’s Network and Service Enablement (NSE) business by narrowing the scope of the Service Enablement business and reducing costs by streamlining NSE operations. As a result approximately 320 employees in manufacturing, R&D and SG&A functions located in North America, Latin America, Europe and Asia were impacted. Payments related to the severance and benefits accrual are expected to be paid in the second quarter of fiscal 2018 . During the third quarter of fiscal 2017, Management also approved a plan in the NE and SE segment to exit the space in Colorado Springs, Colorado. As of September 30, 2017, the Company exited the workspace in Colorado Springs under the plan. The fair value of the remaining contractual obligations as of September 30, 2017 was $1.3 million . Payments related to the Colorado Springs lease costs are expected to be paid by the end of the third quarter of fiscal 2021. Fiscal 2016 Plans NE, SE and Shared Service Agile Restructuring Plan During the fourth quarter of fiscal 2016, Management approved a plan within the NE and SE business segments and Shared Services function for organizational alignment and consolidation as part of the Company’s continued commitment for a more cost effective organization. As a result approximately 170 employees primarily in manufacturing, R&D and SG&A functions located in North America, Latin America, Europe and Asia were impacted. Payments related to the remaining severance and benefits accrual were paid by the end of the first quarter of fiscal 2018 . NE and SE Agile Restructuring Plan During the sec ond quarter of fiscal 2016, Management approved a plan primarily impacting the NE and SE business segments as part of Company’s ongoing commitment for an agile and more efficient operating structure. As a result approximately 40 employees primarily in manufacturing, R&D and SG&A functions located in North America, Latin America, Europe and Asia were impacted. Payments related to the remaining severance and benefits accrual are expected to be paid by the end of the second quarter of fiscal 2018 . Plans Prior to Fiscal 2016 NE Product Strategy Restructuring Plan During the third quarter of fiscal 2014, Management approved a NE plan to realign its services, support and product resources in response to market conditions in the mobile assurance market and to increase focus on software products and next generation solutions through acquisitions and R&D. As a result, approximately 60 employees primarily in SG&A and manufacturing functions located in North America, Latin America, Asia and Europe were impacted. Payments related to the remaining severance and benefits accrual are expected to be paid by the end of the first quarter of fiscal 2020 . NE Lease Restructuring Plan During the second quarter of fiscal 2014, Management approved a NE plan to exit the remaining space in Germantown, Maryland. As of June 28, 2014, the Company exited the space in Germantown under the plan. The fair value of the remaining contractual obligations, net of sublease income, as of September 30, 2017 was $2.3 million . Payments related to the Germantown lease costs are expected to be paid by the end of the second quarter of fiscal 2019 . As of September 30, 2017 , the restructuring accrual for other plans that commenced prior to fiscal year 2016 was $1.1 million , which consists of immaterial accruals from various restructuring plans. |
Income Taxes
Income Taxes | 3 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 12. Income Taxes The Company recorded income tax expense of $2.5 million and $5.7 million for the three months ended September 30, 2017 and October 1, 2016, respectively. The income tax expense for the three months ended September 30, 2017 and October 1, 2016 primarily relates to income tax in certain foreign and state jurisdictions based on the Company’s forecasted pre-tax income or loss for the respective year. A tax benefit of $2.7 million was recorded in the Company’s income tax provision for the three months ended September 30, 2017 related to the income tax intraperiod tax allocation rules in relation to other comprehensive income. In accordance with authoritative guidance, the current quarter benefit may reverse during the year. Upon adoption of the new guidance on share-based payment awards, previously unrecognized excess tax benefits were recorded as a deferred tax asset, which was fully offset by a corresponding increase in valuation allowance, resulting in no impact to opening accumulated deficit. In addition, due to the full valuation allowance on the U.S. deferred tax assets, there was no impact to the income tax provision from excess tax benefits for the three months ended September 30, 2017. The income tax expense recorded differs from the expected tax expense that would be calculated by applying the federal statutory rate to the Company’s income from continuing operations before taxes primarily due to the changes in valuation allowance for deferred tax assets attributable to the Company’s domestic and foreign income (loss) from continuing operations and due to the income tax benefit recorded in continuing operations under the income tax intraperiod tax allocation rules. As of September 30, 2017 and July 1, 2017 , the Company’s unrecognized tax benefits totaled $39.0 million and $38.9 million , respectively, and are included in deferred taxes and other non-current tax liabilities, net. The Company had $1.9 million accrued for the payment of interest and penalties at September 30, 2017 . The unrecognized tax benefits that may be recognized during the next twelve months are approximately $0.1 million . |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Stockholders' Equity | Note 13. Stockholders' Equity Repurchase of Common Stock In September 2016, the Board of Directors increased the Company’s previously authorized stock repurchase program from $100 million to $150 million . Under the revised repurchase authorization, the Company may repurchase up to $150 million of the Company’s common stock from time to time at the discretion of the Company’s management. This stock repurchase authorization expires on December 31, 2017. During the three months ended September 30, 2017 , the Company repurchased approximately 0.9 million shares of its common stock for $9.2 million . As of September 30, 2017 , the Company had remaining authorization of $44.3 million for future share repurchases. The number of shares to be repurchased and the timing of such repurchases will be based on several factors, including business and financial market conditions. All common shares repurchased under this program have been canceled and retired. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Note 14. Stock-Based Compensation Overview The impact on the Company’s results of operations of recording stock-based compensation by function for the three months ended September 30, 2017 and October 1, 2016 was as follows (in millions): Three Months Ended September 30, 2017 October 1, 2016 Cost of revenues $ 0.9 $ 1.0 Research and development 1.1 1.7 Selling, general and administrative 5.5 6.0 Stock-based compensation $ 7.5 $ 8.7 Approximately $0.7 million and $0.8 million of stock-based compensation was capitalized to inventory at September 30, 2017 and October 1, 2016 respectively. Full Value Awards Full Value Awards refer to restricted stock units that are granted with the exercise price equal to zero and are converted to shares immediately upon vesting. These Full Value Awards are time-based, performance-based or a combination of both and expected to vest over three to four years. When converted into shares upon vesting, shares equivalent in value to the minimum withholding taxes liability on the vested shares are withheld by the Company for the payment of such taxes. During the three months ended September 30, 2017 and October 1, 2016 , the Company granted 2.9 million and 3.5 million time-based awards, respectively. The fair value of the time-based Full Value Awards is based on the closing market price of the Company’s common stock on the date of award. The majority of these time-based awards vest over three years , with 33% vesting after one year and the balance vesting quarterly over the remaining two years . During the three months ended September 30, 2017 and October 1, 2016 , the Company granted 0.5 million and 0.4 million , performance-based awards, respectively. These performance-based shares represent the target amount of grants, and the actual number of shares awarded upon vesting may vary depending upon the achievement of the relevant performance conditions. The shares attained over target upon vesting are reflected as awards granted during the period. Accordingly, during the three months ended September 30, 2017 and October 1, 2016 , the Company granted additional 0.2 million and 0.1 million shares due to performance-bases shares attained over target. The aggregate grant-date fair value of performance-based awards granted during the three months ended September 30, 2017 and October 1, 2016 were estimated to be $6.1 million and $3.3 million , respectively. The majority of performance-based awards vest in equal annual installments over three years based on the attainment of certain performance measures and the employee’s continued service through the vest date. The performance-based awards with market condition were valued using a Monte Carlo simulation. As of September 30, 2017 , $60.8 million of unrecognized stock-based compensation cost related to Full Value Awards remains to be amortized. That cost is expected to be recognized over an estimated amortization period of 2.1 years. The Company adopted the new authoritative guidance that simplified several aspects of accounting for share-based payment award transactions including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. Under the new guidance, companies can make an accounting policy election to either continue to estimate forfeitures or account for forfeitures as they occur. Upon adoption, the Company elected to account for forfeitures when they occur, on a modified retrospective basis. The Company recognized net cumulative effect of $0.6 million as an increase to accumulated deficit as of the first day of fiscal 2018. Additionally, the new authoritative guidance required the employee tax paid by withholding shares of restricted stock units on the statements of cash flows to be classified as financing cash flows. Accordingly, upon adoption, the Company reclassified $5.2 million and $4.6 million of tax payment withheld on vesting of restricted stock from operating cash flows to financing cash flows for the three months ended September 30, 2017 and October 1, 2016, respectively. Further, the new authoritative guidance required previously unrecognized deferred tax benefits to be recorded as deferred tax assets. Upon adoption, the Company had $117.7 million of net operating loss carryforwards resulting from excess tax benefit deductions. In accordance with the new authoritative guidance, there was no impact to retained earnings resulting from adoption, as the deferred tax assets associated with these net operating loss carryforwards were fully offset by a corresponding valuation allowance. All other aspects of the guidance did not have a material effect on the Company’s consolidated financial statements. |
Employee Pension and Other Bene
Employee Pension and Other Benefit Plans | 3 Months Ended |
Sep. 30, 2017 | |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |
Employee Pension and Other Benefit Plans | Note 15. Employee Pension and Other Benefit Plans The Company sponsors significant qualified and non-qualified pension plans for certain past and present employees in the United Kingdom (“U.K.”) and Germany. The Company also is responsible for the non-pension post-retirement benefit obligation assumed from a past acquisition. Most of the plans have been closed to new participants and no additional service costs are being accrued, except for certain plans in Germany assumed in connection with an acquisition during fiscal 2010. Benefits are generally based upon years of service and compensation or stated amounts for each year of service. As of September 30, 2017 the U.K. plan was partially funded while the other plans were unfunded. The Company’s policy for funded plans is to make contributions equal to or greater than the requirements prescribed by law or regulation. For unfunded plans, the Company pays the post-retirement benefits when due. During the three months ended September 30, 2017 , the Company contributed $1.0 million to the U.K. plan. The funded plan assets consist primarily of managed investments. The following table presents the components of the net periodic cost for the pension and benefits plans ( in millions ): Three Months Ended Pension Benefits September 30, 2017 October 1, 2016 Service cost $ — $ 0.1 Interest cost 0.7 0.4 Expected return on plan assets (0.4 ) (0.2 ) Amortization of net actuarial losses 0.4 0.5 Net periodic benefit cost $ 0.7 $ 0.8 Both the calculation of the projected benefit obligation and net periodic cost are based upon actuarial valuations. These valuations use participant-specific information such as salary, age, years of service, and assumptions about interest rates, compensation increases and other factors. At a minimum, the Company evaluates these assumptions annually and makes changes as necessary. The Company expects to incur cash outlays of approximately $8.0 million related to its defined benefit pension plans during fiscal 2018 to make current benefit payments and fund future obligations. As of September 30, 2017 , approximately $1.8 million had been incurred. These payments have been estimated based on the same assumptions used to measure the Company’s projected benefit obligation at July 1, 2017 . |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 16. Commitments and Contingencies Legal Proceedings In June 2016, the Company received a court decision regarding the validity of an amendment to a pension deed of trust related to one of its foreign subsidiaries which the Company contends contained an error requiring the Company to increase the pension plan’s benefit. The Company had subsequently further amended the deed to rectify the error. The court ruled that the amendment increasing the pension plan benefit was valid until the subsequent amendment. The Company determined that the likelihood of loss to be probable as of July 2, 2016 and accrued GBP 5.7 million (USD 7.6 million ), in accordance with authoritative guidance on contingencies. The Company is pursuing an appeal of the court decision and is also pursuing a claim against the U.K. law firm responsible for the error. As of September 30, 2017, there was no change to the accrual. The Company is subject to a variety of claims and suits that arise from time to time in the ordinary course of our business. While management currently believes that resolving claims against the Company, individually or in aggregate, will not have a material adverse impact on its financial position, results of operations or statement of cash flows, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future. Were an unfavorable final outcome to occur, there exists the possibility of a material adverse impact on the Company’s financial position, results of operations or cash flows for the period in which the effect becomes reasonably estimable. Guarantees In accordance with authoritative guidance which requires that upon issuance of a guarantee, the guarantor must recognize a liability for the fair value of the obligation it assumes under that guarantee. In addition, disclosures about the guarantees that an entity has issued, including a tabular reconciliation of the changes of the entity’s product warranty liabilities, are required. The Company from time to time enters into certain types of contracts that contingently require the Company to indemnify parties against third-party claims. These contracts primarily relate to: (i) divestiture agreements, under which the Company may provide customary indemnifications to purchasers of the Company’s businesses or assets; (ii) certain real estate leases, under which the Company may be required to indemnify property owners for environmental and other liabilities, and other claims arising from the Company’s use of the applicable premises; and (iii) certain agreements with the Company’s officers, directors and employees, under which the Company may be required to indemnify such persons for liabilities arising out of their employment relationship. The terms of such obligations vary. Generally, a maximum obligation is not explicitly stated. Because the obligated amounts of these types of agreements often are not explicitly stated, the overall maximum amount of the obligations cannot be reasonably estimated. Historically, the Company has not been obligated to make significant payments for these obligations, and no liabilities have been recorded for these obligations on the Consolidated Balance Sheets as of September 30, 2017 and July 1, 2017 . Outstanding Letters of Credit and Performance Bonds As of September 30, 2017 , the Company had standby letters of credit of $11.6 million and performance bonds of $2.1 million collateralized by restricted cash. Product Warranties In general, the Company offers a three -year warranty for most of its products. The Company provides reserves for the estimated costs of product warranties at the time revenue is recognized. The Company estimates the costs of its warranty obligations based on its historical experience of known product failure rates, use of materials to repair or replace defective products and service delivery costs incurred in correcting product failures. In addition, from time to time, specific warranty accruals may be made if unforeseen technical problems arise with specific products. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. The following table presents the changes in the Company’s warranty reserve during fiscal 2018 and fiscal 2017 ( in millions ): Three Months Ended September 30, 2017 October 1, 2016 Balance as of beginning of period $ 5.8 $ 4.9 Provision for warranty 0.5 1.6 Utilization of reserve (0.9 ) (1.1 ) Adjustments related to pre-existing warranties (including changes in estimates) 0.7 (0.2 ) Acquisition of Trilithic (1) 0.3 — Balance as of end of period $ 6.4 $ 5.2 (1) See “ Note 5. Mergers and Acquisitions ” of the Notes to Consolidated Financial Statements for detail of acquisition. |
Operating Segments and Geograph
Operating Segments and Geographic Information | 3 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Operating Segments and Geographic Information | Note 17. Operating Segments and Geographic Information The Company evaluates its reportable segments in accordance with the authoritative guidance on segment reporting. The Company’s Chief Executive Officer is the Company’s Chief Operating Decision Maker (“CODM”) pursuant to the guidance. The CODM allocates resources to the segments based on their business prospects, competitive factors, net revenue and operating results. The Company’s reportable segments are: (i) Network Enablement (“NE”): NE provides testing solutions that access the network to perform build-out and maintenance tasks. These solutions include instruments, software and services to design, build, activate, certify, troubleshoot and optimize networks. The company also offers a range of product support and professional services such as repair, calibration, software support and technical assistance for our products. (ii) Service Enablement (“SE”): SE solutions are embedded systems that yield network, service and application performance data. These solutions—including instruments, microprobes and software—monitor, collect and analyze network data to reveal the actual customer experience and to identify opportunities for new revenue streams and network optimization. (iii) Optical Security and Performance Products (“OSP”): OSP provides innovative, precision, high performance optical products for anti-counterfeiting, government, industrial, automotive and consumer electronic markets, including 3D sensing applications. The CODM manages the Company in two broad business categories: Network and Service Enablement ("NSE") and OSP. NSE operates in two segments, NE and SE, whereas OSP operates as a single segment. The CODM evaluates segment performance of the NSE business based on NE and SE segment gross margin and NSE operating margin as a whole. Operating expenses associated with the NSE business are not allocated to the NE and SE segments within NSE, as they are managed centrally at the business unit level. The CODM evaluates segment performance of the OSP business based on OSP segment operating margin. The Company does not allocate stock-based compensation, acquisition-related charges, amortization of intangibles, restructuring and related charges, impairment of goodwill, non-operating income and expenses, or other charges unrelated to core operating performance to its segments because Management does not include this information in its measurement of the performance of the operating segments. These items are presented as “Reconciling Items” in the table below. Additionally, the Company does not specifically identify and allocate all assets by operating segment. The segment information for all periods presented has been revised to be comparable with the changes in the Company’s segment reporting measures. Information on reportable segments is as follows (in millions): Three Months Ended September 30, 2017 Network and Service Enablement Network Enablement Service Enablement Network and Service Enablement Optical Security and Performance Products Total Segment Measures Reconciling Items Consolidated GAAP Measures Net revenue $ 111.8 $ 29.0 $ 140.8 $ 54.4 $ 195.2 $ — $ 195.2 Gross profit 70.6 20.5 91.1 31.4 122.5 (6.3 ) 116.2 Gross margin 63.1 % 70.7 % 64.7 % 57.7 % 62.8 % 59.5 % Operating income 7.2 22.2 29.4 (19.4 ) 10.0 Operating margin 5.1 % 40.8 % 15.1 % 5.1 % Three Months Ended October 1, 2016 Network and Service Enablement Network Enablement Service Enablement Network and Service Enablement Optical Security and Performance Products Total Segment Measures Reconciling Items Consolidated GAAP Measures Net revenue $ 118.6 $ 36.4 $ 155.0 $ 55.8 $ 210.8 $ — $ 210.8 Gross profit 77.4 21.3 98.7 31.6 130.3 (5.2 ) 125.1 Gross margin 65.3 % 58.5 % 63.7 % 56.6 % 61.8 % 59.3 % Operating income (loss) 4.1 23.4 27.5 (17.4 ) 10.1 Operating margin 2.6 % 41.9 % 13.0 % 4.8 % Three Months Ended September 30, 2017 October 1, 2016 Corporate reconciling items impacting gross profit: Total segment gross profit $ 122.5 $ 130.3 Stock-based compensation (0.9 ) (1.0 ) Amortization of intangibles (4.1 ) (3.8 ) Other charges unrelated to core operating performance (1) (1.3 ) (0.4 ) GAAP gross profit $ 116.2 $ 125.1 Corporate reconciling items impacting operating income: Total segment operating income $ 29.4 $ 27.5 Stock-based compensation (7.5 ) (8.7 ) Amortization of intangibles (7.2 ) (7.3 ) Other charges unrelated to core operating performance (1) (3.2 ) (1.4 ) Restructuring and related charges (1.5 ) — GAAP operating income $ 10.0 $ 10.1 (1) During the three months ended September 30, 2017 and October 1, 2016 , other charges unrelated to core operating performance primarily consisted of loss on disposal of long-lived assets, and transformational initiatives such as the implementation of simplified automated processes, site consolidations, reorganizations, and the insourcing or outsourcing of activities. Additionally, during the three months ended September 30, 2017 , the Company incurred acquisition related costs. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Repurchase of Common Stock Subsequent to our fiscal quarter ended September 30, 2017, the Company repurchased approximately 1.5 million shares of common stock purchases at an average price of $9.35 per share under the stock repurchase program authorized on February 1, 2016. All common shares repurchased have been canceled and retired. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fiscal Years | Fiscal Years The Company utilizes a 52 - 53 week fiscal year ending on the Saturday closest to June 30th. The Company’s fiscal 2018 is a 52 -week year ending on June 30, 2018 . The Company’s fiscal 2017 was a 52 -week year ending on July 1, 2017 . |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the Company and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements, the reported amount of net revenues and expenses and the disclosure of commitments and contingencies during the reporting periods. The Company bases estimates on historical experience and on various assumptions about the future that are believed to be reasonable based on available information. The Company’s reported financial positions or results of operations may be materially different under changed conditions or when using different estimates and assumptions, particularly with respect to significant accounting policies. If estimates or assumptions differ from actual results, subsequent periods are adjusted to reflect more current information. |
Recently Issued Accounting Pronouncements | In May 2017, the Financial Accounting Standards Board (“FASB”) issued guidance that clarifies the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under the relevant authoritative guidance. The guidance is to be applied prospectively, and is effective for the Company in the first quarter of fiscal 2019. Early adoption is permitted. The Company does not anticipate the adoption of this guidance to have a material impact on its consolidated financial statements, absent any award(s) modified on or after adoption date. In November 2016, the FASB issued guidance that will require that the amounts generally described as restricted cash and restricted cash equivalents would be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period amounts shown on the statement of cash flows. The new guidance also requires certain disclosures to supplement the statement of cash flows. The guidance is effective for the Company in the first quarter of fiscal 2019. Other than changes in the presentation within the statements of cash flows and additional required disclosures, the adoption of this new accounting guidance will not have an impact on the consolidated financial statements. In October 2016, the FASB issued guidance that requires entities to recognize at the transaction date the income tax consequences of intra-entity transfer of an asset other than inventory. The guidance is effective for the Company in the first quarter of fiscal 2019. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. In June 2016, the FASB issued guidance that changes the accounting for recognizing impairments of financial assets. Under the new guidance, credit losses for certain types of financial instruments will be estimated based on expected losses. The new guidance also modifies the impairment models for available-for-sale debt securities and for purchased financial assets with credit deterioration since their origination. The guidance is effective for the Company in the first quarter of fiscal 2021 and earlier adoption is permitted. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. In February 2016, the FASB issued guidance regarding both operating and financing leases, requiring lessees to recognize on their balance sheets “right-of-use assets” and corresponding lease liabilities, measured on a discounted basis over the lease term. Virtually all leases will be subject to this treatment except leases that meet the definition of a “short-term lease.” The guidance requires a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The guidance is effective for the Company in the first quarter of fiscal 2020. While the Company is not yet in a position to assess the full impact of the application of the new guidance, the Company expects adoption of this guidance will materially increase the assets and liabilities recorded on its Consolidated Balance Sheets. In May 2014, the FASB issued new authoritative guidance related to revenue recognition from contracts with customers. This new guidance will replace current U.S. GAAP guidance on this topic and eliminate industry-specific guidance. The new guidance provides a unified model to determine when and how revenue is recognized. The core principle of the new guidance is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. This new guidance allows for either full retrospective adoption or modified retrospective adoption. The FASB deferred the effective date for this new guidance by one year to December 15, 2017 for annual reporting periods beginning after such date.The Company will adopt the guidance in the first quarter of fiscal 2019 using the full retrospective method, reflecting the application of the new standard in each prior reporting period. In preparation for the implementation and adoption of the new guidance, the Company has established a cross-functional team and implementation plan to identify processes, systems and internal controls over financial reporting impacted by the new guidance. The implementation plan includes comparison of the Company’s historical accounting policies and practices to the requirements of the new guidance, and identifying differences from applying the requirements of the new guidance to the Company’s contracts, consolidated financial statements and related disclosures. While the Company’s assessment of the potential impacts of the new guidance is not yet complete, initially the Company believes the most significant impact on the accounting for contracts with customers will be for certain arrangements that include sales of software solutions bundled with post-contract support (PCS) and/or services, where VSOE has not been established for the PCS and/or the services. Due to lack of VSOE under the current guidance, the Company defers recognition of any revenue attributable to such arrangements until the services lacking VSOE are complete. Such revenue is then recognized ratably over the remaining support term. The requirement to have VSOE for undelivered elements to enable the separation of the revenue for delivered software is eliminated under the new guidance and the Company will be required to allocate total contract revenue to each element (referred to as a distinct performance obligation under the new standard) based on either an established or estimated standalone selling price. Accordingly, a portion of the revenue for these types of contracts with customers will be recognized when the software or software solution is transferred to the customer. Dependent on contract-specific terms, the Company expects the actual revenue recognition treatment and timing will vary under the new guidance for some of these arrangements. The Company will continue to evaluate the impact of this new guidance on its consolidated financial statements and related disclosures. |
Fair Value Measurements | The Company’s cash and investment instruments are classified within Level 1 or Level 2 of the fair value hierarchy based on quoted prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. • Level 1 includes financial instruments for which quoted market prices for identical instruments are available in active markets. Level 1 assets of the Company include money market funds, U.S. Treasury securities and marketable equity securities as they are traded with sufficient volume and frequency of transactions. • Level 2 includes financial instruments for which the valuations are based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. Level 2 instruments of the Company generally include certain U.S. and foreign government and agency securities, commercial paper, corporate and municipal bonds and notes, asset-backed securities, certificates of deposit, and foreign currency forward contracts. To estimate their fair value, the Company utilizes pricing models based on market data. The significant inputs for the valuation model usually include benchmark yields, reported trades, broker and dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data, and industry and economic events. • Level 3 includes financial instruments for which fair value is derived from valuation based on inputs that are unobservable and significant to the overall fair value measurement. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of computation of basic and diluted net (loss) income per share | The following table sets forth the computation of basic and diluted net (loss) income per share ( in millions, except per share data ): Three Months Ended September 30, 2017 October 1, 2016 Numerator: Net (loss) income $ (4.8 ) $ 78.0 Denominator: Weighted-average number of common shares outstanding Basic 228.1 232.4 Effect of dilutive securities from stock-based benefit plans — 4.4 Diluted 228.1 236.8 Net (loss) income per share: Basic $ (0.02 ) $ 0.34 Diluted $ (0.02 ) $ 0.33 |
Schedule of weighted average potentially dilutive securities excluded from the computation because their effect would have been anti-dilutive | The following table sets forth the weighted-average potentially dilutive securities excluded from the computation of the diluted net (loss) income per share because their effect would have been anti-dilutive ( in millions ): Three Months Ended September 30, 2017 (1) (2) October 1, 2016 (1) Stock options and ESPP 1.7 1.6 Restricted Stock Units 8.0 2.0 Total potentially dilutive securities 9.7 3.6 (1) The Company’s 0.625% Senior Convertible Notes due 2033 are not included in the table above. The par amount of convertible notes is payable in cash equal to the principal amount of the notes plus any accrued and unpaid interest and then the “in-the-money” conversion benefit feature at the conversion price above $11.28 per share is payable in cash, shares of the Company’s common stock or a combination of both at the Company’s election. Refer to “ Note 10. Debt ” for more details. (2) The Company’s 1.00% Senior Convertible Notes due 2024 are not included in the table above. The par amount of convertible notes is payable in cash equal to the principal amount of the notes plus any accrued and unpaid interest and then the “in-the-money” conversion benefit feature at the conversion price above $13.22 per share is payable in cash, shares of the Company’s common stock or a combination of both at the Company’s election. Refer to “ Note 10. Debt ” for more details. |
Accumulated Other Comprehensi27
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Schedule of components of accumulated other comprehensive loss | For the three months ended September 30, 2017 the changes in accumulated other comprehensive loss by component net of tax were as follows ( in millions ): Unrealized gains (losses) on available-for sale investments Foreign currency translation adjustments Change in unrealized components of defined benefit obligations, net of tax (1) Total Beginning balance as of July 1, 2017 $ (5.3 ) $ (65.3 ) $ (21.8 ) $ (92.4 ) Other comprehensive income before reclassification — 10.2 — 10.2 Amounts reclassified out of accumulated other comprehensive loss — — 0.4 0.4 Net current-period other comprehensive income — 10.2 0.4 10.6 Ending balance as of September 30, 2017 $ (5.3 ) $ (55.1 ) $ (21.4 ) $ (81.8 ) (1) The amount reclassified out of accumulated other comprehensive loss represents the amortization of actuarial losses included as a component of cost of revenues, research and development (“R&D”) and selling, general and administrative expense (“SG&A”) in the Consolidated Statement of Operations for the three months ended September 30, 2017 . There was no tax impact for the three months ended September 30, 2017 . Refer to “ Note 15. Employee Pension and Other Benefit Plans ” for more details on the computation of net periodic cost for pension plans. |
Mergers and Acquisitions (Table
Mergers and Acquisitions (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Schedule of purchase price allocation and components of tangible assets acquired | The following table summarizes the components of the tangible assets acquired at fair value (in millions) : Cash $ 0.2 Accounts receivable 3.2 Inventory 10.1 Property and equipment 1.2 Accounts payable (1.7 ) Other liabilities, net of other assets (1.2 ) Net tangible assets acquired $ 11.8 The purchase price was allocated as follows (in millions) : Net tangible assets acquired $ 11.8 Intangible assets acquired: Developed technology 15.5 Customer relationships 11.0 Other 0.3 Goodwill 16.9 Total purchase price $ 55.5 |
Balance Sheet and Other Detai29
Balance Sheet and Other Details (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of components of accounts receivable reserves and allowances | The components of accounts receivable reserves and allowances were as follows ( in millions ): September 30, 2017 July 1, 2017 Allowance for doubtful accounts $ 1.7 $ 1.6 Sales allowance 2.0 3.4 Total accounts receivable reserves and allowances $ 3.7 $ 5.0 The activities and balances for allowance for doubtful accounts are as follows (in millions): July 1, 2017 Acquisition of Trilithic (1) Charged to Costs and Expenses Adjustments September 30, 2017 Allowance for doubtful accounts $ 1.6 0.1 — — $ 1.7 (1) See “ Note 5. Mergers and Acquisitions ” of the Notes to Consolidated Financial Statements for detail of acquisition. |
Schedule of components of Inventories | The components of inventories, net were as follows ( in millions ): September 30, 2017 July 1, 2017 Finished goods $ 33.6 $ 24.9 Work in process 14.4 10.3 Raw materials 20.9 12.8 Inventories, net $ 68.9 $ 48.0 |
Schedule of components of Prepayments and other current assets | The components of prepayments and other current assets were as follo ws ( in millions ): September 30, 2017 July 1, 2017 Prepayments $ 8.9 $ 8.3 Other current assets 39.0 42.5 Prepayments and other current assets $ 47.9 $ 50.8 |
Schedule of components of Other current liabilities | The components of other current liabilities were as follows ( in millions ): September 30, 2017 July 1, 2017 Customer prepayments 35.5 35.2 Restructuring accrual 6.8 8.8 Income tax payable 1.5 3.3 Warranty accrual 3.4 2.9 VAT liabilities 1.4 2.2 Deferred compensation plan 2.1 2.0 Other 3.4 7.0 Other current liabilities $ 54.1 $ 61.4 |
Schedule of components of Other non-current liabilities | The components of other non-current liabilities were as follo ws ( in millions ): September 30, 2017 July 1, 2017 Pension and post-employment benefits $ 102.3 $ 99.4 Financing obligation 27.7 27.8 Long-term deferred revenue 12.6 14.0 Other 23.2 22.7 Other non-current liabilities $ 165.8 $ 163.9 |
Investments, Forward Contract30
Investments, Forward Contracts and Fair Value Measurements (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of available-for-sale securities | As of September 30, 2017 , the Company’s available-for-sale securities were as follows ( in millions ): Amortized Cost/ Carrying Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale debt securities: U.S. treasuries $ 88.5 $ — $ (0.1 ) $ 88.4 U.S. agencies 13.9 — (0.1 ) 13.8 Municipal bonds and sovereign debt instruments 4.4 — — 4.4 Asset-backed securities 62.7 — (0.4 ) 62.3 Corporate securities 330.4 0.1 (0.1 ) 330.4 Total available-for-sale debt securities $ 499.9 $ 0.1 $ (0.7 ) $ 499.3 As of July 1, 2017 , the Company’s available-for-sale securities were as follows ( in millions ): Amortized Cost/ Carrying Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale securities: U.S. treasuries $ 56.8 $ — $ (0.1 ) $ 56.7 U.S. agencies 45.0 — (0.1 ) 44.9 Municipal bonds and sovereign debt instruments 4.4 — — 4.4 Asset-backed securities 71.5 — (0.4 ) 71.1 Corporate securities 326.1 0.1 (0.2 ) 326.0 Certificates of deposit 6.0 — — 6.0 Total available-for-sale securities $ 509.8 $ 0.1 $ (0.8 ) $ 509.1 |
Schedule of contractual maturities of available-for-sale securities | As of September 30, 2017 , contractual maturities of the Company’s debt securities classified as available-for-sale securities were as follows ( in millions ): Amortized Cost/ Carrying Cost Estimated Fair Value Amounts maturing in less than 1 year $ 384.9 $ 384.8 Amounts maturing in 1 - 5 years 114.0 113.8 Amounts maturing in more than 5 years 1.0 0.7 Total debt available-for-sale securities $ 499.9 $ 499.3 |
Schedule of assets measured at fair value | Assets measured at fair value as of September 30, 2017 and July 1, 2017 are summarized below ( in millions ): Fair value measurement as of Fair value measurement as of September 30, 2017 July 1, 2017 Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Assets: Debt available-for-sale securities U.S. treasuries $ 88.4 $ 88.4 $ — $ 56.7 $ 56.7 $ — U.S. agencies 13.8 — 13.8 44.9 — 44.9 Municipal bonds and sovereign debt instruments 4.4 — 4.4 4.4 — 4.4 Asset-backed securities 62.3 — 62.3 71.1 — 71.1 Corporate securities 330.4 — 330.4 326.0 — 326.0 Certificate of deposits — — — 6.0 — 6.0 Total debt available-for-sale securities 499.3 88.4 410.9 509.1 56.7 452.4 Money market funds 530.5 530.5 — 726.4 726.4 — Trading securities 2.1 2.1 — 2.0 2.0 — Foreign currency forward contracts 4.0 — 4.0 7.3 — 7.3 Total assets (1) $ 1,035.9 $ 621.0 $ 414.9 $ 1,244.8 $ 785.1 $ 459.7 Liability: Foreign currency forward contracts 0.9 — 0.9 1.3 — 1.3 Total liabilities (2) $ 0.9 $ — $ 0.9 $ 1.3 $ — $ 1.3 (1) $ 588.7 million in cash and cash equivalents, $430.9 million in short-term investments, $7.3 million in restricted cash, $ 4.0 million in prepayments and other current assets, and $5.0 million in other non-current assets on the Company’s Consolidated Balance Sheets as of September 30, 2017 . $789.2 million in cash and cash equivalents, $432.2 million in short-term investments, $11.0 million in restricted cash, $7.3 million in prepayments and other current assets, and $5.1 million in other non-current assets on the Company’s Consolidated Balance Sheets as of July 1, 2017 . (2) $ 0.9 million in other current liabilities on the Company’s Consolidated Balance Sheets as of September 30, 2017 . $1.3 million in other current liabilities on the Company’s Consolidated Balance Sheets as of July 1, 2017 . |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in goodwill | The following table presents the changes in goodwill allocated to the Company’s reportable segments (in millions) : Network Enablement Optical Security and Performance Products Total Balance as of July 1, 2017 $ 143.3 $ 8.3 $ 151.6 Goodwill - Trilithic (1) 16.9 — 16.9 Currency translation adjustments 0.9 — 0.9 Balance as of September 30, 2017 $ 161.1 $ 8.3 $ 169.4 (1) See “ Note 5. Mergers and Acquisitions ” of the Notes to Consolidated Financial Statements for detail. |
Acquired Developed Technology32
Acquired Developed Technology and Other Intangibles (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Acquired Developed Technology and Other Intangibles | |
Schedule of acquired developed technology and other intangibles | The following tables present details of the Company’s acquired developed technology, customer relationships and other intangibles ( in millions ): As of September 30, 2017 Gross Carrying Amount Accumulated Amortization Net Acquired developed technology $ 386.7 $ (357.6 ) $ 29.1 Customer relationships 106.4 (84.8 ) 21.6 Other (1) 10.2 (10.1 ) 0.1 Total intangibles $ 503.3 $ (452.5 ) $ 50.8 As of July 1, 2017 Gross Carrying Amount Accumulated Amortization Net Acquired developed technology $ 369.3 $ (352.0 ) $ 17.3 Customer relationships 94.9 (81.3 ) 13.6 Other (1) 9.9 (9.7 ) 0.2 Total intangibles $ 474.1 $ (443.0 ) $ 31.1 (1) Other intangibles consist of customer backlog, non-competition agreements, patents, proprietary know-how and trade secrets, trademarks and trade names. |
Finite-lived intangible assets amortization expense | The following table presents the amortization recorded relating to acquired developed technology, customer relationships and other intangibles ( in millions ): Three Months Ended September 30, 2017 October 1, 2016 Cost of revenues $ 4.1 $ 3.8 Operating expenses 3.1 3.5 Total amortization of intangible assets $ 7.2 $ 7.3 |
Schedule of estimated future amortization | Based on the carrying amount of acquired developed technology, customer relationships and other intangibles as of September 30, 2017 , and assuming no future impairment of the underlying assets, the estimated future amortization is as follows ( in millions ): Fiscal Years Remainder of 2018 $ 19.8 2019 16.3 2020 8.4 2021 4.1 2022 2.0 Thereafter 0.2 Total amortization $ 50.8 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of carrying amounts of the liability and equity components of convertible debt | The following table presents the carrying amounts of the liability and equity components ( in millions ): September 30, 2017 July 1, 2017 Principal amount of 0.625% Senior Convertible Notes $ 463.5 $ 610.0 Principal amount of 1.00% Senior Convertible Notes 460.0 460.0 Unamortized discount of liability component (113.5 ) (129.4 ) Unamortized debt issuance cost (7.9 ) (9.2 ) Carrying amount of liability component $ 802.1 $ 931.4 Current portion of long-term debt 443.3 — Long-term debt, net of current portion $ 358.8 $ 931.4 Carrying amount of equity component (1) $ 210.4 $ 229.7 (1) Included in additional paid-in-capital on the Consolidated Balance Sheets. |
Summary of effective interest rate and the interest expense for the contractual interest and the accretion of debt discount | The following table presents the interest expense for contractual interest, amortization of debt issuance cost and accretion of debt discount ( in millions ): Three Months Ended September 30, 2017 October 1, 2016 Interest expense-contractual interest $ 2.0 $ 1.0 Amortization of debt issuance cost 0.7 0.6 Accretion of debt discount 9.1 6.9 |
Restructuring and Related Cha34
Restructuring and Related Charges (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Restructuring and Related Activities [Abstract] | |
Schedule of various restructuring plans | The adjustments to the accrued restructuring expenses related to all of the Company’s restructuring plans described below for the three months ended September 30, 2017 were as follows (in millions) : Balance Three Months Ended September 30, 2017 Charges (Benefits) Cash Settlements Non-cash Settlements and Other Adjustments Balance September 30, 2017 Fiscal 2017 Plan OSP Restructuring Plan (1) $ 0.8 $ — $ — $ — $ 0.8 Focused NSE Restructuring Plan (1) (2) 4.9 1.2 (3.1 ) 0.4 3.4 Other Plans (2) — 0.4 (0.2 ) 0.1 0.3 Fiscal 2016 Plan NE, SE and Shared Services Agile Restructuring Plan (1) 0.2 (0.1 ) (0.1 ) — — NE and SE Agile Restructuring Plan (1) 0.4 — — — 0.4 Plans Prior to Fiscal 2016 NE Product Strategy Restructuring Plan (1) 0.9 — (0.1 ) — 0.8 NE Lease Restructuring Plan (2) 2.6 — (0.3 ) — 2.3 Other Plans (1)(2) 1.2 — (0.1 ) — 1.1 Total $ 11.0 $ 1.5 $ (3.9 ) $ 0.5 $ 9.1 (1) Plan type includes workforce reduction cost. (2) Plan type includes lease exit cost. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of the impact on the entity's results of operations of recording stock-based compensation by function | The impact on the Company’s results of operations of recording stock-based compensation by function for the three months ended September 30, 2017 and October 1, 2016 was as follows (in millions): Three Months Ended September 30, 2017 October 1, 2016 Cost of revenues $ 0.9 $ 1.0 Research and development 1.1 1.7 Selling, general and administrative 5.5 6.0 Stock-based compensation $ 7.5 $ 8.7 |
Employee Pension and Other Be36
Employee Pension and Other Benefit Plans (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract] | |
Schedule of net periodic cost for the pension and benefits plans | The following table presents the components of the net periodic cost for the pension and benefits plans ( in millions ): Three Months Ended Pension Benefits September 30, 2017 October 1, 2016 Service cost $ — $ 0.1 Interest cost 0.7 0.4 Expected return on plan assets (0.4 ) (0.2 ) Amortization of net actuarial losses 0.4 0.5 Net periodic benefit cost $ 0.7 $ 0.8 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of changes in the entity's warranty reserve | The following table presents the changes in the Company’s warranty reserve during fiscal 2018 and fiscal 2017 ( in millions ): Three Months Ended September 30, 2017 October 1, 2016 Balance as of beginning of period $ 5.8 $ 4.9 Provision for warranty 0.5 1.6 Utilization of reserve (0.9 ) (1.1 ) Adjustments related to pre-existing warranties (including changes in estimates) 0.7 (0.2 ) Acquisition of Trilithic (1) 0.3 — Balance as of end of period $ 6.4 $ 5.2 (1) See “ Note 5. Mergers and Acquisitions ” of the Notes to Consolidated Financial Statements for detail of acquisition. |
Operating Segments and Geogra38
Operating Segments and Geographic Information (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of information on reportable segments | Information on reportable segments is as follows (in millions): Three Months Ended September 30, 2017 Network and Service Enablement Network Enablement Service Enablement Network and Service Enablement Optical Security and Performance Products Total Segment Measures Reconciling Items Consolidated GAAP Measures Net revenue $ 111.8 $ 29.0 $ 140.8 $ 54.4 $ 195.2 $ — $ 195.2 Gross profit 70.6 20.5 91.1 31.4 122.5 (6.3 ) 116.2 Gross margin 63.1 % 70.7 % 64.7 % 57.7 % 62.8 % 59.5 % Operating income 7.2 22.2 29.4 (19.4 ) 10.0 Operating margin 5.1 % 40.8 % 15.1 % 5.1 % Three Months Ended October 1, 2016 Network and Service Enablement Network Enablement Service Enablement Network and Service Enablement Optical Security and Performance Products Total Segment Measures Reconciling Items Consolidated GAAP Measures Net revenue $ 118.6 $ 36.4 $ 155.0 $ 55.8 $ 210.8 $ — $ 210.8 Gross profit 77.4 21.3 98.7 31.6 130.3 (5.2 ) 125.1 Gross margin 65.3 % 58.5 % 63.7 % 56.6 % 61.8 % 59.3 % Operating income (loss) 4.1 23.4 27.5 (17.4 ) 10.1 Operating margin 2.6 % 41.9 % 13.0 % 4.8 % Three Months Ended September 30, 2017 October 1, 2016 Corporate reconciling items impacting gross profit: Total segment gross profit $ 122.5 $ 130.3 Stock-based compensation (0.9 ) (1.0 ) Amortization of intangibles (4.1 ) (3.8 ) Other charges unrelated to core operating performance (1) (1.3 ) (0.4 ) GAAP gross profit $ 116.2 $ 125.1 Corporate reconciling items impacting operating income: Total segment operating income $ 29.4 $ 27.5 Stock-based compensation (7.5 ) (8.7 ) Amortization of intangibles (7.2 ) (7.3 ) Other charges unrelated to core operating performance (1) (3.2 ) (1.4 ) Restructuring and related charges (1.5 ) — GAAP operating income $ 10.0 $ 10.1 (1) During the three months ended September 30, 2017 and October 1, 2016 , other charges unrelated to core operating performance primarily consisted of loss on disposal of long-lived assets, and transformational initiatives such as the implementation of simplified automated processes, site consolidations, reorganizations, and the insourcing or outsourcing of activities. Additionally, during the three months ended September 30, 2017 , the Company incurred acquisition related costs. |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | ||
Sep. 30, 2017 | Oct. 01, 2016 | Aug. 21, 2013 | |
Numerator: | |||
Net income (loss) | $ (4.8) | $ 78 | |
Weighted-average number of common shares outstanding | |||
Basic (in shares) | 228.1 | 232.4 | |
Effect of dilutive securities from stock-based benefit plans (in shares) | 0 | 4.4 | |
Diluted (in shares) | 228.1 | 236.8 | |
Net (loss) income per share: | |||
Basic (in dollars per share) | $ (0.02) | $ 0.34 | |
Diluted (in dollars per share) | $ (0.02) | $ 0.33 | |
Anti-dilutive securities excluded from computation of earnings per share | |||
Total potentially dilutive securities (in shares) | 9.7 | 3.6 | |
2033 Notes | Convertible Notes | |||
Convertible notes | |||
Interest rate on senior convertible notes | 0.625% | 0.625% | |
Conversion price of debt (in dollars per share) | $ 11.28 | ||
2024 Notes | Convertible Notes | |||
Convertible notes | |||
Interest rate on senior convertible notes | 1.00% | ||
Conversion price of debt (in dollars per share) | $ 13.22 | ||
Stock options and ESPP | |||
Anti-dilutive securities excluded from computation of earnings per share | |||
Total potentially dilutive securities (in shares) | 1.7 | 1.6 | |
Restricted Stock Units | |||
Anti-dilutive securities excluded from computation of earnings per share | |||
Total potentially dilutive securities (in shares) | 8 | 2 |
Accumulated Other Comprehensi40
Accumulated Other Comprehensive Loss (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2017 | Oct. 01, 2016 | |
Changes in accumulated other comprehensive income (loss) by component | ||
Balance at the beginning of the period | $ 786,400,000 | |
Other comprehensive income before reclassification | 10,200,000 | |
Amounts reclassified out of accumulated other comprehensive loss | 400,000 | |
Net change in accumulated other comprehensive loss | 10,600,000 | $ 6,800,000 |
Balance at the end of the period | 766,300,000 | |
Tax impact of amortization of actuarial gains (losses) | 0 | |
Total | ||
Changes in accumulated other comprehensive income (loss) by component | ||
Balance at the beginning of the period | (92,400,000) | |
Balance at the end of the period | (81,800,000) | |
Unrealized gains (losses) on available-for-sale investments | ||
Changes in accumulated other comprehensive income (loss) by component | ||
Balance at the beginning of the period | (5,300,000) | |
Other comprehensive income before reclassification | 0 | |
Amounts reclassified out of accumulated other comprehensive loss | 0 | |
Net change in accumulated other comprehensive loss | 0 | |
Balance at the end of the period | (5,300,000) | |
Foreign currency translation adjustments | ||
Changes in accumulated other comprehensive income (loss) by component | ||
Balance at the beginning of the period | (65,300,000) | |
Other comprehensive income before reclassification | 10,200,000 | |
Amounts reclassified out of accumulated other comprehensive loss | 0 | |
Net change in accumulated other comprehensive loss | 10,200,000 | |
Balance at the end of the period | (55,100,000) | |
Change in unrealized components of defined benefit obligations, net of tax | ||
Changes in accumulated other comprehensive income (loss) by component | ||
Balance at the beginning of the period | (21,800,000) | |
Other comprehensive income before reclassification | 0 | |
Amounts reclassified out of accumulated other comprehensive loss | 400,000 | |
Net change in accumulated other comprehensive loss | 400,000 | |
Balance at the end of the period | $ (21,400,000) |
Mergers and Acquisitions - Narr
Mergers and Acquisitions - Narrative (Details) - Trilithic, Inc - USD ($) $ in Millions | Aug. 09, 2017 | Sep. 30, 2017 |
Business Acquisition [Line Items] | ||
Total purchase price | $ 55.5 | |
Acquisition-related costs | $ 0.9 | |
Minimum | ||
Business Acquisition [Line Items] | ||
Estimated useful life | 3 years | |
Maximum | ||
Business Acquisition [Line Items] | ||
Estimated useful life | 5 years |
Mergers and Acquisitions - Purc
Mergers and Acquisitions - Purchase Price Allocation (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Aug. 09, 2017 | Jul. 01, 2017 |
Business Acquisition [Line Items] | |||
Goodwill | $ 169.4 | $ 151.6 | |
Trilithic, Inc | |||
Business Acquisition [Line Items] | |||
Net tangible assets acquired | $ 11.8 | ||
Goodwill | 16.9 | ||
Total purchase price | 55.5 | ||
Developed technology | Trilithic, Inc | |||
Business Acquisition [Line Items] | |||
Intangible assets acquired: | 15.5 | ||
Customer relationships | Trilithic, Inc | |||
Business Acquisition [Line Items] | |||
Intangible assets acquired: | 11 | ||
Other | Trilithic, Inc | |||
Business Acquisition [Line Items] | |||
Intangible assets acquired: | $ 0.3 |
Mergers and Acquisitions - Asse
Mergers and Acquisitions - Assets Acquired (Details) - Trilithic, Inc $ in Millions | Aug. 09, 2017USD ($) |
Business Acquisition [Line Items] | |
Cash | $ 0.2 |
Accounts receivable | 3.2 |
Inventory | 10.1 |
Property and equipment | 1.2 |
Accounts payable | (1.7) |
Other liabilities, net of other assets | (1.2) |
Net tangible assets acquired | $ 11.8 |
Balance Sheet and Other Detai44
Balance Sheet and Other Details - Accounts Receivable Reserves and Allowances (Details) $ in Millions | 3 Months Ended |
Sep. 30, 2017USD ($) | |
Allowance for doubtful accounts | |
Components of accounts receivable reserves and allowances | |
Beginning balance | $ 1.6 |
Acquisition of Trilithic | 0.1 |
Charged to Costs and Expenses | 0 |
Adjustments | 0 |
Ending balance | 1.7 |
Sales allowance | |
Components of accounts receivable reserves and allowances | |
Beginning balance | 3.4 |
Ending balance | 2 |
Total accounts receivable reserves and allowances | |
Components of accounts receivable reserves and allowances | |
Beginning balance | 5 |
Ending balance | $ 3.7 |
Balance Sheet and Other Detai45
Balance Sheet and Other Details - Inventories (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Jul. 01, 2017 |
Inventories, net | ||
Finished goods | $ 33.6 | $ 24.9 |
Work in process | 14.4 | 10.3 |
Raw materials | 20.9 | 12.8 |
Inventories, net | $ 68.9 | $ 48 |
Balance Sheet and Other Detai46
Balance Sheet and Other Details - Prepayments and Other Current Assets (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Jul. 01, 2017 |
Prepayments and other current assets | ||
Prepayments | $ 8.9 | $ 8.3 |
Other current assets | 39 | 42.5 |
Prepayments and other current assets | $ 47.9 | $ 50.8 |
Balance Sheet and Other Detai47
Balance Sheet and Other Details - Other Current Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Jul. 01, 2017 |
Other current liabilities | ||
Customer prepayments | $ 35.5 | $ 35.2 |
Restructuring accrual | 6.8 | 8.8 |
Income taxes payable | 1.5 | 3.3 |
Warranty accrual | 3.4 | 2.9 |
VAT liabilities | 1.4 | 2.2 |
Deferred compensation plan | 2.1 | 2 |
Other | 3.4 | 7 |
Other current liabilities | $ 54.1 | $ 61.4 |
Balance Sheet and Other Detai48
Balance Sheet and Other Details - Other Non-Current Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Jul. 01, 2017 |
Other non-current liabilities | ||
Pension and post-employment benefits | $ 102.3 | $ 99.4 |
Financing obligation | 27.7 | 27.8 |
Long-term deferred revenue | 12.6 | 14 |
Other | 23.2 | 22.7 |
Other non-current liabilities | $ 165.8 | $ 163.9 |
Investments, Forward Contract49
Investments, Forward Contracts and Fair Value Measurements - Amortized Cost to Fair Value Reconciliation (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Jul. 01, 2017 |
Available-For-Sale Investments | ||
Amortized Cost/ Carrying Cost | $ 499.9 | |
Gross Unrealized Gains | 0.1 | |
Gross Unrealized Losses | (0.7) | |
Fair Value | 499.3 | |
Total debt securities | ||
Available-For-Sale Investments | ||
Amortized Cost/ Carrying Cost | $ 509.8 | |
Gross Unrealized Gains | 0.1 | |
Gross Unrealized Losses | (0.8) | |
Fair Value | 509.1 | |
U.S. treasuries | ||
Available-For-Sale Investments | ||
Amortized Cost/ Carrying Cost | 88.5 | 56.8 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (0.1) | (0.1) |
Fair Value | 88.4 | 56.7 |
U.S. agencies | ||
Available-For-Sale Investments | ||
Amortized Cost/ Carrying Cost | 13.9 | 45 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (0.1) | (0.1) |
Fair Value | 13.8 | 44.9 |
Municipal bonds and sovereign debt instruments | ||
Available-For-Sale Investments | ||
Amortized Cost/ Carrying Cost | 4.4 | 4.4 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 4.4 | 4.4 |
Asset-backed securities | ||
Available-For-Sale Investments | ||
Amortized Cost/ Carrying Cost | 62.7 | 71.5 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (0.4) | (0.4) |
Fair Value | 62.3 | 71.1 |
Corporate securities | ||
Available-For-Sale Investments | ||
Amortized Cost/ Carrying Cost | 330.4 | 326.1 |
Gross Unrealized Gains | 0.1 | 0.1 |
Gross Unrealized Losses | (0.1) | (0.2) |
Fair Value | $ 330.4 | 326 |
Certificates of deposit | ||
Available-For-Sale Investments | ||
Amortized Cost/ Carrying Cost | 6 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Fair Value | $ 6 |
Investments, Forward Contract50
Investments, Forward Contracts and Fair Value Measurements - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Sep. 30, 2017 | Oct. 01, 2016 | Jul. 01, 2017 | |
Investments, Forward Contracts and Fair Value Measurements | |||
Term of maturities of securities classified as current assets included in short-term investments | 12 months | ||
Fair Value | $ 499,300,000 | ||
Other-than-temporary impairment loss | 0 | $ 0 | |
Not designated | Foreign exchange forward contracts | |||
Foreign Currency Forward Contracts | |||
Derivative asset, fair value | 4,000,000 | $ 7,300,000 | |
Derivative liability, fair value | $ 900,000 | 1,300,000 | |
Derivative, term of contract | 120 days | ||
Gains (losses) on derivatives | $ 3,100,000 | $ 300,000 | |
Not designated | Foreign exchange forward contracts | Held to purchase | |||
Foreign Currency Forward Contracts | |||
Notional amount of forward contracts | 135,200,000 | 134,300,000 | |
Not designated | Foreign exchange forward contracts | Held to sell | |||
Foreign Currency Forward Contracts | |||
Notional amount of forward contracts | 25,900,000 | 25,400,000 | |
Cash equivalents | |||
Investments, Forward Contracts and Fair Value Measurements | |||
Fair Value | 69,800,000 | 78,200,000 | |
Short-term investments | |||
Investments, Forward Contracts and Fair Value Measurements | |||
Fair Value | 428,800,000 | 430,200,000 | |
Other non-current assets | |||
Investments, Forward Contracts and Fair Value Measurements | |||
Fair Value | 700,000 | 700,000 | |
Trading securities | Short-term investments | |||
Investments, Forward Contracts and Fair Value Measurements | |||
Deferred compensation plan assets | 2,100,000 | 2,000,000 | |
Trading securities | Short-term investments | Debt securities | |||
Investments, Forward Contracts and Fair Value Measurements | |||
Deferred compensation plan assets | 400,000 | 500,000 | |
Trading securities | Short-term investments | Money market instruments and funds | |||
Investments, Forward Contracts and Fair Value Measurements | |||
Deferred compensation plan assets | 300,000 | 300,000 | |
Trading securities | Short-term investments | Marketable equity investments | |||
Investments, Forward Contracts and Fair Value Measurements | |||
Deferred compensation plan assets | $ 1,400,000 | $ 1,200,000 |
Investments, Forward Contract51
Investments, Forward Contracts and Fair Value Measurements - Contractual Maturities (Details) - Total debt securities $ in Millions | Sep. 30, 2017USD ($) |
Amortized Cost/ Carrying Cost | |
Amounts maturing in less than 1 year | $ 384.9 |
Amounts maturing in 1 - 5 years | 114 |
Amounts maturing in more than 5 years | 1 |
Total debt available-for-sale securities | 499.9 |
Estimated Fair Value | |
Amounts maturing in less than 1 year | 384.8 |
Amounts maturing in 1 - 5 years | 113.8 |
Amounts maturing in more than 5 years | 0.7 |
Total debt available-for-sale securities | $ 499.3 |
Investments, Forward Contract52
Investments, Forward Contracts and Fair Value Measurements - Measured at Fair Value (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Jul. 01, 2017 |
Other current liabilities | ||
Liability: | ||
Total liabilities | $ 0.9 | $ 1.3 |
Recurring basis | Cash and cash equivalents | ||
Debt available-for-sale securities | ||
Total assets | 588.7 | 789.2 |
Recurring basis | Short-term investments | ||
Debt available-for-sale securities | ||
Total assets | 430.9 | 432.2 |
Recurring basis | Restricted cash | ||
Debt available-for-sale securities | ||
Total assets | 7.3 | 11 |
Recurring basis | Prepayments and other current assets | ||
Debt available-for-sale securities | ||
Total assets | 4 | |
Recurring basis | Other current assets | ||
Debt available-for-sale securities | ||
Total assets | 7.3 | |
Recurring basis | Other non-current assets | ||
Debt available-for-sale securities | ||
Total assets | 5 | 5.1 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 88.4 | 56.7 |
Money market funds | 530.5 | 726.4 |
Trading securities | 2.1 | 2 |
Foreign currency forward contracts | 0 | 0 |
Total assets | 621 | 785.1 |
Liability: | ||
Foreign currency forward contracts | 0 | 0 |
Total liabilities | 0 | 0 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. treasuries | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 88.4 | 56.7 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. agencies | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 0 | 0 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Municipal bonds and sovereign debt instruments | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 0 | 0 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Asset-backed securities | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 0 | 0 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Corporate securities | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 0 | 0 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Certificates of deposit | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 0 | 0 |
Recurring basis | Significant Other Observable Inputs (Level 2) | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 410.9 | 452.4 |
Money market funds | 0 | 0 |
Trading securities | 0 | 0 |
Foreign currency forward contracts | 4 | 7.3 |
Total assets | 414.9 | 459.7 |
Liability: | ||
Foreign currency forward contracts | 0.9 | 1.3 |
Total liabilities | 0.9 | 1.3 |
Recurring basis | Significant Other Observable Inputs (Level 2) | U.S. treasuries | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 0 | 0 |
Recurring basis | Significant Other Observable Inputs (Level 2) | U.S. agencies | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 13.8 | 44.9 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Municipal bonds and sovereign debt instruments | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 4.4 | 4.4 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Asset-backed securities | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 62.3 | 71.1 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Corporate securities | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 330.4 | 326 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Certificates of deposit | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 0 | 6 |
Recurring basis | Total | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 499.3 | 509.1 |
Money market funds | 530.5 | 726.4 |
Trading securities | 2.1 | 2 |
Foreign currency forward contracts | 4 | 7.3 |
Total assets | 1,035.9 | 1,244.8 |
Liability: | ||
Foreign currency forward contracts | 0.9 | 1.3 |
Total liabilities | 0.9 | 1.3 |
Recurring basis | Total | U.S. treasuries | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 88.4 | 56.7 |
Recurring basis | Total | U.S. agencies | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 13.8 | 44.9 |
Recurring basis | Total | Municipal bonds and sovereign debt instruments | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 4.4 | 4.4 |
Recurring basis | Total | Asset-backed securities | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 62.3 | 71.1 |
Recurring basis | Total | Corporate securities | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | 330.4 | 326 |
Recurring basis | Total | Certificates of deposit | ||
Debt available-for-sale securities | ||
Total debt available-for-sale securities | $ 0 | $ 6 |
Goodwill (Details)
Goodwill (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2017 | Jul. 01, 2017 | |
Changes in goodwill | ||
Balance at the beginning of the period | $ 151,600,000 | |
Goodwill - Trilithic | 16,900,000 | |
Currency translation adjustments | 900,000 | |
Balance at the end of the period | 169,400,000 | $ 151,600,000 |
Network Enablement | ||
Changes in goodwill | ||
Balance at the beginning of the period | 143,300,000 | |
Goodwill - Trilithic | 16,900,000 | |
Currency translation adjustments | 900,000 | |
Balance at the end of the period | 161,100,000 | 143,300,000 |
Goodwill impairment | 0 | |
Optical Security and Performance Products | ||
Changes in goodwill | ||
Balance at the beginning of the period | 8,300,000 | |
Goodwill - Trilithic | 0 | |
Currency translation adjustments | 0 | |
Balance at the end of the period | $ 8,300,000 | 8,300,000 |
Goodwill impairment | $ 0 |
Acquired Developed Technology54
Acquired Developed Technology and Other Intangibles (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 30, 2017 | Oct. 01, 2016 | Jul. 01, 2017 | |
Acquired developed technology, customer relationships and other intangibles | |||
Gross Carrying Amount | $ 503.3 | $ 474.1 | |
Accumulated Amortization | (452.5) | (443) | |
Net | 50.8 | 31.1 | |
Cost of revenues | 4.1 | $ 3.8 | |
Amortization of other intangibles | 3.1 | 3.5 | |
Total amortization of intangible assets | 7.2 | $ 7.3 | |
Estimated future amortization expense | |||
Remainder of 2018 | 19.8 | ||
2,019 | 16.3 | ||
2,020 | 8.4 | ||
2,021 | 4.1 | ||
2,022 | 2 | ||
Thereafter | 0.2 | ||
Total amortization | 50.8 | ||
Acquired developed technology | |||
Acquired developed technology, customer relationships and other intangibles | |||
Gross Carrying Amount | 386.7 | 369.3 | |
Accumulated Amortization | (357.6) | (352) | |
Net | 29.1 | 17.3 | |
Customer relationships | |||
Acquired developed technology, customer relationships and other intangibles | |||
Gross Carrying Amount | 106.4 | 94.9 | |
Accumulated Amortization | (84.8) | (81.3) | |
Net | 21.6 | 13.6 | |
Other | |||
Acquired developed technology, customer relationships and other intangibles | |||
Gross Carrying Amount | 10.2 | 9.9 | |
Accumulated Amortization | (10.1) | (9.7) | |
Net | $ 0.1 | $ 0.2 |
Debt - Carrying Amounts of the
Debt - Carrying Amounts of the Liability and Equity Components (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Jul. 01, 2017 | Aug. 21, 2013 |
Carrying amounts of the liability and equity components: | |||
Current portion of long-term debt | $ 443.3 | $ 0 | |
Long-term debt, net of current portion | 358.8 | 931.4 | |
Convertible Notes | |||
Carrying amounts of the liability and equity components: | |||
Unamortized discount of liability component | (113.5) | (129.4) | |
Unamortized debt issuance cost | (7.9) | (9.2) | |
Carrying amount of liability component | 802.1 | 931.4 | |
Carrying amount of equity component | 210.4 | 229.7 | |
Convertible Notes | 0.625% Senior Convertible Notes | |||
Carrying amounts of the liability and equity components: | |||
Principal amount of notes | $ 463.5 | 610 | |
Interest rate on senior convertible notes | 0.625% | 0.625% | |
Convertible Notes | 1.00% Senior Convertible Notes | |||
Carrying amounts of the liability and equity components: | |||
Principal amount of notes | $ 460 | $ 460 | |
Interest rate on senior convertible notes | 1.00% |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Mar. 03, 2017 | Aug. 21, 2013 | Mar. 31, 2017 | Sep. 30, 2017 | Oct. 01, 2016 | Jul. 01, 2017 | Mar. 22, 2017 |
Debt details | |||||||
Loss on extinguishment of debt | $ 3,600,000 | $ 0 | |||||
1.00% Senior Convertible Notes | Convertible Notes | |||||||
Debt details | |||||||
Interest rate on senior convertible notes | 1.00% | ||||||
Aggregate principal amount of convertible debt | $ 400,000,000 | $ 60,000,000 | |||||
Proceeds from debt, net of issuance costs | $ 451,100,000 | ||||||
Discount rate | 4.80% | ||||||
Derivative, term of contract | 7 years | ||||||
Fair market value of convertible debt | $ 463,100,000 | $ 481,700,000 | |||||
Amount outstanding | $ 460,000,000 | 460,000,000 | |||||
0.625% Senior Convertible Notes | Convertible Notes | |||||||
Debt details | |||||||
Interest rate on senior convertible notes | 0.625% | 0.625% | |||||
Aggregate principal amount of convertible debt | $ 650,000,000 | ||||||
Proceeds from debt, net of issuance costs | $ 636,300,000 | ||||||
Discount rate | 5.40% | ||||||
Derivative, term of contract | 5 years | ||||||
Redemption percentage | 100.00% | ||||||
Fair market value of convertible debt | $ 488,000,000 | 676,100,000 | |||||
Expected remaining term | 10 months 15 days | ||||||
Principal amount of debt repurchased | $ 146,500,000 | ||||||
Repurchase of debt | 162,000,000 | ||||||
Loss on extinguishment of debt | 3,600,000 | ||||||
Amount outstanding | $ 463,500,000 | $ 610,000,000 |
Debt - Interest Expense (Detail
Debt - Interest Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2017 | Oct. 01, 2016 | |
Debt Disclosure [Abstract] | ||
Interest expense-contractual interest | $ 2 | $ 1 |
Amortization of debt issuance cost | 0.7 | 0.6 |
Accretion of debt discount | $ 9.1 | $ 6.9 |
Restructuring and Related Cha58
Restructuring and Related Charges (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Sep. 30, 2017USD ($) | Jul. 01, 2017USD ($)employee | Oct. 01, 2016USD ($) | Jul. 02, 2016employee | Jan. 02, 2016employee | Mar. 29, 2014employee | Apr. 01, 2017USD ($)employee | |
Summary of various restructuring plans | |||||||
Accrual balance at the beginning of the period | $ 11 | ||||||
Restructuring Charges (Benefits) | $ 1.5 | $ 0 | |||||
Cash Settlements | (3.9) | ||||||
Non-cash Settlements and Other Adjustments | 0.5 | ||||||
Accrual balance at the end of the period | 9.1 | 11 | |||||
Long-term restructuring accrual | 2.3 | $ 2.2 | |||||
OSP Restructuring Plan | |||||||
Summary of various restructuring plans | |||||||
Accrual balance at the beginning of the period | 0.8 | ||||||
Restructuring Charges (Benefits) | 0 | ||||||
Cash Settlements | 0 | ||||||
Non-cash Settlements and Other Adjustments | 0 | ||||||
Accrual balance at the end of the period | 0.8 | 0.8 | |||||
Focused NSE Restructuring Plan | |||||||
Summary of various restructuring plans | |||||||
Accrual balance at the beginning of the period | $ 4.9 | ||||||
Restructuring Charges (Benefits) | 1.2 | ||||||
Cash Settlements | (3.1) | ||||||
Non-cash Settlements and Other Adjustments | 0.4 | ||||||
Accrual balance at the end of the period | 3.4 | 4.9 | |||||
Number of employees impacted (employee) | employee | 30 | 320 | |||||
Fair value of remaining contractual obligation | 1.3 | ||||||
Other Plan | |||||||
Summary of various restructuring plans | |||||||
Accrual balance at the beginning of the period | $ 0 | ||||||
Restructuring Charges (Benefits) | 0.4 | ||||||
Cash Settlements | (0.2) | ||||||
Non-cash Settlements and Other Adjustments | 0.1 | ||||||
Accrual balance at the end of the period | 0.3 | 0 | |||||
NE, SE and Shared Services Agile Restructuring Plan | |||||||
Summary of various restructuring plans | |||||||
Accrual balance at the beginning of the period | 0.2 | ||||||
Restructuring Charges (Benefits) | (0.1) | ||||||
Cash Settlements | (0.1) | ||||||
Non-cash Settlements and Other Adjustments | 0 | ||||||
Accrual balance at the end of the period | 0 | 0.2 | |||||
Number of employees impacted (employee) | employee | 170 | ||||||
NE and SE Agile Restructuring Plan | |||||||
Summary of various restructuring plans | |||||||
Accrual balance at the beginning of the period | 0.4 | ||||||
Restructuring Charges (Benefits) | 0 | ||||||
Cash Settlements | 0 | ||||||
Non-cash Settlements and Other Adjustments | 0 | ||||||
Accrual balance at the end of the period | 0.4 | 0.4 | |||||
Number of employees impacted (employee) | employee | 40 | ||||||
Plans Prior to Fiscal 2015 | |||||||
Summary of various restructuring plans | |||||||
Accrual balance at the end of the period | 1.1 | ||||||
NE Product Strategy Restructuring Plan | |||||||
Summary of various restructuring plans | |||||||
Accrual balance at the beginning of the period | 0.9 | ||||||
Restructuring Charges (Benefits) | 0 | ||||||
Cash Settlements | (0.1) | ||||||
Non-cash Settlements and Other Adjustments | 0 | ||||||
Accrual balance at the end of the period | 0.8 | 0.9 | |||||
Number of employees impacted (employee) | employee | 60 | ||||||
NE Lease Restructuring Plan | |||||||
Summary of various restructuring plans | |||||||
Accrual balance at the beginning of the period | 2.6 | ||||||
Restructuring Charges (Benefits) | 0 | ||||||
Cash Settlements | (0.3) | ||||||
Non-cash Settlements and Other Adjustments | 0 | ||||||
Accrual balance at the end of the period | 2.3 | 2.6 | |||||
Contractual obligations under the operating lease, net of sublease income, fair value | 2.3 | ||||||
Other Plans | |||||||
Summary of various restructuring plans | |||||||
Accrual balance at the beginning of the period | $ 1.2 | ||||||
Restructuring Charges (Benefits) | 0 | ||||||
Cash Settlements | (0.1) | ||||||
Non-cash Settlements and Other Adjustments | 0 | ||||||
Accrual balance at the end of the period | $ 1.1 | $ 1.2 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 30, 2017 | Oct. 01, 2016 | Jul. 01, 2017 | |
Income Tax Disclosure [Abstract] | |||
Income tax expense (benefit) | $ 2.5 | $ 5.7 | |
Tax benefit related to income tax intraperiod tax allocation | 2.7 | ||
Unrecognized tax benefits | 39 | $ 38.9 | |
Interest and penalties accrued | 1.9 | ||
Unrecognized tax benefits that may be recognized during the next twelve months | $ 0.1 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) shares in Millions | 3 Months Ended | |||
Sep. 30, 2017 | Oct. 01, 2016 | Sep. 30, 2016 | Sep. 29, 2016 | |
Class of Stock [Line Items] | ||||
Authorized amount under stock repurchase program | $ 150,000,000 | $ 100,000,000 | ||
Payment for share repurchase | $ 9,200,000 | $ 25,500,000 | ||
Common stock | ||||
Class of Stock [Line Items] | ||||
Shares delivered and retired (in shares) | 0.9 | |||
Remaining authorization for future share repurchases | $ 44,300,000 |
Stock-Based Compensation - Comp
Stock-Based Compensation - Compensation by Function (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2017 | Oct. 01, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation | $ 7.5 | $ 8.7 |
Cost of revenues | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation | 0.9 | 1 |
Research and development | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation | 1.1 | 1.7 |
Selling, general and administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation | $ 5.5 | $ 6 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | ||
Sep. 30, 2017 | Oct. 01, 2016 | Jul. 02, 2017 | |
Stock-Based Compensation | |||
Stock-based compensation capitalized to inventory | $ 0.7 | $ 0.8 | |
Reclassification out of operating cash flows | 11 | 14.9 | |
Reclassification to financing cash flows | $ 174.6 | $ 27 | |
Operating loss carryforward | $ 117.7 | ||
Full Value Awards - Total | |||
Stock-Based Compensation | |||
Exercise price (in dollars per share) | $ 0 | ||
Unrecognized stock-based compensation | $ 60.8 | ||
Estimated amortization period for unrecognized compensation | 2 years 1 month 2 days | ||
Full Value Awards - Total | Minimum | |||
Stock-Based Compensation | |||
Vesting period | 3 years | ||
Full Value Awards - Total | Maximum | |||
Stock-Based Compensation | |||
Vesting period | 4 years | ||
RSUs | |||
Stock-Based Compensation | |||
Granted (in shares) | 2.9 | 3.5 | |
Restricted Stock Units with Performance Conditions Over Target | |||
Stock-Based Compensation | |||
Granted (in shares) | 0.2 | 0.1 | |
Restricted Stock Units with Time Based Conditions | |||
Stock-Based Compensation | |||
Vesting period | 3 years | ||
Percentage of first tranche vested | 33.00% | ||
Initial vesting period | 1 year | ||
Subsequent vesting period | 2 years | ||
Restricted Stock Units with Market and Performance Conditions | |||
Stock-Based Compensation | |||
Vesting period | 3 years | ||
Granted (in shares) | 0.5 | 0.4 | |
Aggregate grant-date fair value | $ 6.1 | $ 3.3 | |
Accounting Standards Update 2016-09 | |||
Stock-Based Compensation | |||
Reclassification out of operating cash flows | 5.2 | 4.6 | |
Reclassification to financing cash flows | $ 5.2 | $ 4.6 | |
Accounting Standards Update 2016-09 | Retained Earnings | |||
Stock-Based Compensation | |||
Cumulative effect adjustment | $ 0.6 |
Employee Pension and Other Be63
Employee Pension and Other Benefit Plans (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2017 | Oct. 01, 2016 | |
Employee Defined Benefit Plans | ||
Employer contributions | $ 1.8 | |
Components of the net periodic cost for the pension and benefits plans | ||
Cash outlays expected during current fiscal year | 8 | |
Pension Benefit Plans | ||
Components of the net periodic cost for the pension and benefits plans | ||
Service cost | 0 | $ 0.1 |
Interest cost | 0.7 | 0.4 |
Expected return on plan assets | (0.4) | (0.2) |
Amortization of net actuarial losses | 0.4 | 0.5 |
Net periodic benefit cost | 0.7 | $ 0.8 |
U.K. | Foreign Pension Plan | ||
Employee Defined Benefit Plans | ||
Employer contributions | $ 1 |
Commitments and Contingencies64
Commitments and Contingencies (Details) £ in Millions | 3 Months Ended | ||||
Sep. 30, 2017USD ($) | Oct. 01, 2016USD ($) | Jul. 01, 2017USD ($) | Jul. 02, 2016USD ($) | Jul. 02, 2016GBP (£) | |
Loss Contingencies [Line Items] | |||||
Guarantee liabilities | $ 0 | $ 0 | |||
Standby letters of credit | $ 11,600,000 | ||||
Product Warranties | |||||
Warranty Term for most products | 3 years | ||||
Changes in warranty reserve | |||||
Balance as of beginning of period | $ 5,800,000 | $ 4,900,000 | |||
Provision for warranty | 500,000 | 1,600,000 | |||
Utilization of reserve | (900,000) | (1,100,000) | |||
Adjustments related to pre-existing warranties (including changes in estimates) | 700,000 | (200,000) | |||
Acquisition of Trilithic | 300,000 | 0 | |||
Balance as of end of period | 6,400,000 | $ 5,200,000 | |||
Performance bond | |||||
Loss Contingencies [Line Items] | |||||
Guarantee liabilities | $ 2,100,000 | ||||
Judicial ruling | Case related to amendment of pension for foreign subsidiary | |||||
Loss Contingencies [Line Items] | |||||
Loss contingency accrual | $ 7,600,000 | £ 5.7 |
Operating Segments and Geogra65
Operating Segments and Geographic Information - Information on Reportable Segments (Details) $ in Millions | 3 Months Ended | |
Sep. 30, 2017USD ($)segmentsubsegment | Oct. 01, 2016USD ($) | |
Information on reportable segments | ||
Number of broad business categories (in segment) | segment | 2 | |
Net revenue | $ 195.2 | $ 210.8 |
Gross profit | $ 116.2 | $ 125.1 |
Gross margin (as a percent) | 59.50% | 59.30% |
Operating income (loss) | $ 10 | $ 10.1 |
Operating margin (as a percent) | 5.10% | 4.80% |
Segment Measures | ||
Information on reportable segments | ||
Net revenue | $ 195.2 | $ 210.8 |
Gross profit | $ 122.5 | $ 130.3 |
Gross margin (as a percent) | 62.80% | 61.80% |
Operating income (loss) | $ 29.4 | $ 27.5 |
Operating margin (as a percent) | 15.10% | 13.00% |
Reconciling Items | ||
Information on reportable segments | ||
Net revenue | $ 0 | $ 0 |
Gross profit | (6.3) | (5.2) |
Operating income (loss) | $ (19.4) | (17.4) |
Network and Service Enablement | ||
Information on reportable segments | ||
Number of subsegment (in subsegment) | subsegment | 2 | |
Network and Service Enablement | Segment Measures | ||
Information on reportable segments | ||
Net revenue | $ 140.8 | 155 |
Gross profit | $ 91.1 | $ 98.7 |
Gross margin (as a percent) | 64.70% | 63.70% |
Operating income (loss) | $ 7.2 | $ 4.1 |
Operating margin (as a percent) | 5.10% | 2.60% |
Network and Service Enablement | Network Enablement | Segment Measures | ||
Information on reportable segments | ||
Net revenue | $ 111.8 | $ 118.6 |
Gross profit | $ 70.6 | $ 77.4 |
Gross margin (as a percent) | 63.10% | 65.30% |
Network and Service Enablement | Service Enablement | Segment Measures | ||
Information on reportable segments | ||
Net revenue | $ 29 | $ 36.4 |
Gross profit | $ 20.5 | $ 21.3 |
Gross margin (as a percent) | 70.70% | 58.50% |
Optical Security and Performance Products | Segment Measures | ||
Information on reportable segments | ||
Net revenue | $ 54.4 | $ 55.8 |
Gross profit | $ 31.4 | $ 31.6 |
Gross margin (as a percent) | 57.70% | 56.60% |
Operating income (loss) | $ 22.2 | $ 23.4 |
Operating margin (as a percent) | 40.80% | 41.90% |
Operating Segments and Geogra66
Operating Segments and Geographic Information - Segment Reconciling Items (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2017 | Oct. 01, 2016 | |
Information on reportable segments | ||
Gross profit | $ 116.2 | $ 125.1 |
Amortization of intangibles | (4.1) | (3.8) |
Operating income | 10 | 10.1 |
Stock-based compensation | (7.5) | (8.7) |
Amortization of intangibles | (3.1) | (3.5) |
Restructuring and related charges | (1.5) | 0 |
Segment Measures | ||
Information on reportable segments | ||
Gross profit | 122.5 | 130.3 |
Operating income | 29.4 | 27.5 |
Reconciling Items | ||
Information on reportable segments | ||
Gross profit | (6.3) | (5.2) |
Stock-based compensation | (0.9) | (1) |
Amortization of intangibles | (4.1) | (3.8) |
Other charges related to non-recurring activities | (1.3) | (0.4) |
Operating income | (19.4) | (17.4) |
Stock-based compensation | (7.5) | (8.7) |
Amortization of intangibles | (7.2) | (7.3) |
Other charges related to non-recurring activities | (3.2) | (1.4) |
Restructuring and related charges | $ (1.5) | $ 0 |
Subsequent Events Narrative (De
Subsequent Events Narrative (Details) - Subsequent Event shares in Millions | 1 Months Ended |
Nov. 08, 2017$ / sharesshares | |
Subsequent Event [Line Items] | |
Shares repurchased (in shares) | shares | 1.5 |
Shares repurchased, price per share (in dollars per share) | $ / shares | $ 9.35 |