Segment Reporting

3 Months Ended

Mar. 31, 2012

Segment Reporting [Abstract]

Segment Reporting

12. Segment Reporting

Intevac’s two reportable segments are: Equipment and Intevac Photonics. Intevac’s chief operating decision-maker has been identified as the President and CEO, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Segment information is presented based upon Intevac’s management organization structure as of March 31, 2012 and the distinctive nature of each segment. Future changes to this internal financial structure may result in changes to the reportable segments disclosed.

Each reportable segment is separately managed and has separate financial results that are reviewed by Intevac’s chief operating decision-maker. Each reportable segment contains closely related products that are unique to the particular segment. Segment operating profit is determined based upon internal performance measures used by the chief operating decision-maker.

Intevac derives the segment results from its internal management reporting system. The accounting policies Intevac uses to derive reportable segment results are substantially the same as those used for external reporting purposes. Management measures the performance of each reportable segment based upon several metrics, including orders, net revenues and operating income. Management uses these results to evaluate the performance of, and to assign resources to, each of the reportable segments. Intevac manages certain operating expenses separately at the corporate level. Intevac allocates certain of these corporate expenses to the segments in an amount equal to 3% of net revenues. Segment operating income excludes interest income/expense and other financial charges and income taxes according to how a particular reportable segment’s management is measured. Management does not consider impairment charges, gains and losses on divestitures and sales of intellectual property, and unallocated costs in measuring the performance of the reportable segments.

The Equipment segment designs, develops and manufactures equipment and solutions to the hard disk drive industry and offers high-productivity technology solutions to the photovoltaic (“PV”) industry. Historically, the majority of Intevac’s revenue has been derived from the Equipment segment and Intevac expects that the majority of its revenues for the next several years will continue to be derived from the Equipment segment.

The Intevac Photonics segment develops and manufactures leading-edge, high-sensitivity imaging products and vision systems as well as materials identification instruments utilizing Raman technology. Intevac provides sensors, cameras and systems for government applications such as night vision and long-range target identification and for commercial applications in the inspection, scientific and medical industries.

Information for each reportable segment for the three months ended March 31, 2012 and April 2, 2011 is as follows:

Net Revenues

	Three months ended
	March 31, 2012		April 2, 2011
	(In thousands)
Equipment	$	10,719	$	10,180
Intevac Photonics		6,596		7,243
Total segment net revenues	$	17,315	$	17,423

Operating Loss

	Three months ended
	March 31, 2012			April 2, 2011
	(In thousands)
Equipment	$	(6,325	)	$	(6,270	)
Intevac Photonics		(1,039	)		(1,583	)
Loss from segment operations		(7,364	)		(7,853	)
Unallocated costs		(1,798	)		(1,664	)
Gain on sale of mainframe technology		2,207			—
Loss from operations		(6,955	)		(9,517	)
Interest income, net		211			246
Other income and expense, net		161			(117	)
Loss before income taxes	$	(6,583	)	$	(9,388	)

Total assets for each reportable segment as of March 31, 2012 and December 31, 2011 are as follows:

Assets

	March 31, 2012		December 31, 2011
	(In thousands)
Equipment	$	51,036	$	48,133
Intevac Photonics		29,387		29,947
Total segment assets		80,423		78,080
Cash, cash equivalents and investments		111,726		114,822
Deferred income taxes		27,590		23,919
Other current assets		6,766		6,848
Common property, plant and equipment		1,255		1,366
Other assets		841		786
Consolidated total assets	$	228,601	$	225,821