10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

(MARK ONE)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 28, 2013

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission file number 0-26946

INTEVAC, INC.

(Exact name of registrant as specified in its charter)

Delaware	94-3125814
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

3560 Bassett Street

Santa Clara, California 95054

(Address of principal executive office, including Zip Code)

Registrant’s telephone number, including area code: (408) 986-9888

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes ¨ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). x Yes ¨ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ¨ Accelerated filer x Non-accelerated filer ¨
(Do not check if a smaller reporting company) Smaller reporting company ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ¨ Yes x No

On October 29, 2013, 24,006,002 shares of the Registrant’s Common Stock, $0.001 par value, were outstanding.

INTEVAC, INC.

INDEX

		Page No.
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Condensed Consolidated Balance Sheets		3
	Condensed Consolidated Statements of Operations		4
	Condensed Consolidated Statements of Comprehensive Income (Loss)		5
	Condensed Consolidated Statements of Cash Flows		6
	Notes to Condensed Consolidated Financial Statements		7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		32
Item 4.	Controls and Procedures		32
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings		34
Item 1A.	Risk Factors		34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		41
Item 3.	Defaults Upon Senior Securities		41
Item 4.	Mine Safety Disclosures		41
Item 5.	Other Information		41
Item 6.	Exhibits		42
SIGNATURES			43

2

PART I. FINANCIAL INFORMATION

Item 1.   Financial Statements

INTEVAC, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	September 28, 2013			December 31, 2012
	(Unaudited)
	(In thousands, except par value)
ASSETS
Current assets:
Cash and cash equivalents	$	16,626		$	24,261
Short-term investments		48,433			40,591
Trade and other accounts receivable, net of allowances of $0 at both September 28, 2013 and at December 31, 2012		16,114			19,822
Inventories		25,794			26,193
Prepaid expenses and other current assets		1,750			2,120
Total current assets		108,717			112,987
Property, plant and equipment, net		13,065			13,426
Long-term investments		20,661			27,317
Intangible assets, net of amortization of $3,205 at September 28, 2013 and $2,887 at December 31, 2012		5,180			5,868
Deferred income taxes and other long-term assets		13,730			12,905
Total assets	$	161,353		$	172,503
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	4,719		$	4,479
Accrued payroll and related liabilities		5,246			4,194
Other accrued liabilities		6,111			8,489
Customer advances		5,862			2,193
Deferred income taxes		1,281			1,281
Total current liabilities		23,219			20,636
Other long-term liabilities		9,250			9,232
Stockholders’ equity:
Common stock, $0.001 par value		24			23
Additional paid-in capital		155,701			151,996
Accumulated other comprehensive income		733			769
Accumulated deficit		(27,574	)		(10,153	)
Total stockholders’ equity		128,884			142,635
Total liabilities and stockholders’ equity	$	161,353		$	172,503

Note: Amounts as of December 31, 2012 are derived from the December 31, 2012 audited consolidated financial statements.

See accompanying notes to the condensed consolidated financial statements.

3

INTEVAC, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(Unaudited)
	(In thousands, except per share amounts)
Net revenues:
Systems and components	$	15,991		$	11,665		$	38,111		$	55,067
Technology development		3,124			5,169			10,970			10,874
Total net revenues		19,115			16,834			49,081			65,941
Cost of net revenues:
Systems and components		9,725			7,476			26,206			31,561
Technology development		2,495			3,626			8,638			7,569
Total cost of net revenues		12,220			11,102			34,844			39,130
Gross profit		6,895			5,732			14,237			26,811
Operating expenses:
Research and development		4,250			7,336			16,192			24,812
Selling, general and administrative		5,627			6,389			16,834			19,831
Bad debt expense		—			3,017			—			3,017
Total operating expenses		9,877			16,742			33,026			47,660
Gain (loss) on divestitures		—			—			(208	)		2,207
Loss from operations		(2,982	)		(11,010	)		(18,997	)		(18,642	)
Interest income and other, net		220			(8	)		392			411
Loss before income taxes		(2,762	)		(11,018	)		(18,605	)		(18,231	)
Benefit from income taxes		(17	)		(3,011	)		(1,184	)		(5,570	)
Net loss	$	(2,745	)	$	(8,007	)	$	(17,421	)	$	(12,661	)
Net loss per share:
Basic and diluted	$	(0.11	)	$	(0.34	)	$	(0.73	)	$	(0.54	)
Weighted average common shares outstanding:
Basic and diluted		23,931			23,397			23,793			23,293

See accompanying notes to the condensed consolidated financial statements.

4

INTEVAC, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(Unaudited)
	(In thousands)
Net loss	$	(2,745	)	$	(8,007	)	$	(17,421	)	$	(12,661	)
Other comprehensive income (loss), before tax
Change in unrealized net loss on available-for-sale investments		60			73			(29	)		305
Foreign currency translation gains (losses)		3			19			(7	)		5
Other comprehensive income (loss), before tax		63			92			(36	)		310
Income tax (expense) benefit related to items in other comprehensive income (loss)		—			(26	)		—			(107	)
Other comprehensive income (loss), net of tax		63			66			(36	)		203
Comprehensive loss	$	(2,682	)	$	(7,941	)	$	(17,457	)	$	(12,458	)

See accompanying notes to the condensed consolidated financial statements.

5

INTEVAC, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Nine months ended
	September 28, 2013			September 29, 2012
	(Unaudited)
	(In thousands)
Operating activities
Net loss	$	(17,421	)	$	(12,661	)
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:
Depreciation and amortization		3,280			3,391
Net amortization of investment premiums and discounts		655			1,076
Net loss on sale of investments		—			210
Bad debt expense		—			3,017
Equity-based compensation		1,836			2,941
Change in the fair value of acquisition-related contingent consideration		(24	)		443
Deferred income taxes		(1,013	)		(5,418	)
Loss (gain) on divestitures		208			(2,207	)
Loss (gain) on disposal of equipment		(153	)		168
Changes in operating assets and liabilities		4,285			(5,430	)
Total adjustments		9,074			(1,809	)
Net cash and cash equivalents used in operating activities		(8,347	)		(14,470	)
Investing activities
Purchases of investments		(32,606	)		(32,987	)
Proceeds from sales and maturities of investments		31,736			41,346
Proceeds from sale of DeltaNu assets		500			—
Proceeds from sale of mainframe technology		—			3,000
Proceeds from sale of equipment		153			—
Purchases of leasehold improvements and equipment		(928	)		(2,114	)
Net cash and cash equivalents provided by (used in) investing activities		(1,145	)		9,245
Financing activities
Payment of acquisition-related contingent consideration		(40	)		(3,345	)
Net proceeds from issuance of common stock		1,905			1,865
Net cash and cash equivalents provided by (used in) financing activities		1,865			(1,480	)
Effect of exchange rate changes on cash		(8	)		4
Net decrease in cash and cash equivalents		(7,635	)		(6,701	)
Cash and cash equivalents at beginning of period		24,261			23,560
Cash and cash equivalents at end of period	$	16,626		$	16,859
Non-cash investing activity
Finished goods inventory transferred to property, plant and equipment	$	1,551			—

See accompanying notes to the condensed consolidated financial statements.

6

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Basis of Presentation

In the opinion of management, the unaudited interim condensed consolidated financial statements of Intevac, Inc. and its subsidiaries (Intevac or the Company) included herein have been prepared on a basis consistent with the December 31, 2012 audited consolidated financial statements and include all material adjustments, consisting of normal recurring adjustments, necessary to fairly present the information set forth therein. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in Intevac’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012 (“2012 Form 10-K”). Intevac’s results of operations for the three and nine months ended September 28, 2013 are not necessarily indicative of future operating results.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make judgments, estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates.

2. Recent Accounting Pronouncement

Presentation of Unrecognized Tax Benefits: In July 2013, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”) to provide guidance on the presentation of unrecognized tax benefits. ASU 2013-11 requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows: to the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. ASU 2013-11 is effective for us in our first quarter of fiscal 2014 with earlier adoption permitted. ASU 2013-11 should be applied prospectively with retroactive application permitted. We are currently evaluating the impact of our pending adoption of ASU 2013-11 on our consolidated financial statements.

3. Inventories

Inventories are stated at the lower of average cost or market and consist of the following:

	September 28,		December 31,
	2013		2012
	(In thousands)
Raw materials	$	15,778	$	14,921
Work-in-progress		8,327		5,526
Finished goods		1,689		5,746
	$	25,794	$	26,193

Finished goods inventory consists primarily of completed systems at customer sites that are undergoing installation and acceptance testing and evaluation inventory.

7

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

4. Equity-Based Compensation

At September 28, 2013, Intevac had equity-based awards outstanding under the 2012 Equity Incentive Plan, the 2004 Equity Incentive Plan (the “Plans”) and the 2003 Employee Stock Purchase Plan (the “ESPP”). Intevac’s stockholders approved all of these plans. The Plans permit the grant of incentive or non-statutory stock options, restricted stock, stock appreciation rights, restricted stock units (“RSUs” also referred to as performance units) and performance shares.

The ESPP provides that eligible employees may purchase Intevac’s common stock through payroll deductions at a price equal to 85% of the lower of the fair market value at the beginning of the applicable offering period or at the end of each applicable purchase interval. Offering periods are generally two years in length, and consist of a series of six-month purchase intervals. Eligible employees may join the ESPP at the beginning of any six-month purchase interval. Under the terms of the ESPP, employees can choose to have up to 15% of their base earnings withheld to purchase Intevac common stock.

Compensation Expense

The effect of recording equity-based compensation for the three and nine months ended September 28, 2013 and September 29, 2012 was as follows:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(In thousands)
Equity-based compensation by type of award:
Stock options	$	375		$	523		$	651		$	1,843
RSUs		130			88			314			111
Employee stock purchase plan		249			332			871			987
Total equity-based compensation		754			943			1,836			2,941
Tax effect on equity-based compensation		(8	)		(205	)		(18	)		(706	)
Net effect on net loss	$	746		$	738		$	1,818		$	2,235

Equity-based compensation expense is based on awards ultimately expected to vest and such amount has been reduced for estimated forfeitures. Forfeitures were estimated based on Intevac’s historical experience, which Intevac believes to be indicative of Intevac’s future experience.

Stock Options and ESPP

The fair value of stock options and ESPP awards is estimated at the grant date using the Black-Scholes option valuation model. The determination of fair value of stock options and ESPP awards on the date of grant using an option-pricing model is affected by Intevac’s stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, our expected stock price volatility over the term of the awards and actual employee stock option exercise behavior.

8

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

Option activity as of September 28, 2013 and changes during the nine months ended September 28, 2013 were as follows:

	Shares			Weighted Average Exercise Price
Options outstanding at December 31, 2012		3,128,408		$	11.52
Options granted		902,770		$	5.59
Options cancelled and forfeited		(1,339,934	)	$	13.73
Options exercised		(69,838	)	$	3.91
Options outstanding at September 28, 2013		2,621,406		$	8.55
Vested and expected to vest at September 28, 2013		2,386,932		$	8.77
Options exercisable at September 28, 2013		1,412,001		$	10.34

Intevac issued 457,000 shares under the ESPP during the nine months ended September 28, 2013.

Intevac estimated the weighted-average fair value of stock options and employee stock purchase rights using the following weighted-average assumptions:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
Stock Options:
Weighed-average fair value of grants per share	$	2.81		$	2.87		$	2.48		$	3.90
Expected volatility		55.06	%		63.19	%		56.40	%		63.80	%
Risk free interest rate		1.04	%		0.41	%		1.09	%		0.74	%
Expected term of options (in years)		4.02			3.94			4.22			4.63
Dividend yield		None			None			None			None

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
Stock Purchase Rights:
Weighed-average fair value of grants per share	$	1.97		$	2.31		$	1.63		$	3.01
Expected volatility		43.09	%		63.23	%		51.54	%		62.36	%
Risk free interest rate		0.21	%		0.21	%		0.26	%		0.28	%
Expected term of purchase rights (in years)		1.00			1.85			1.77			1.68
Dividend yield		None			None			None			None

The computation of the expected volatility assumptions used in the Black-Scholes calculations for new grants and purchase rights is based on the historical volatility of Intevac’s stock price, measured over a period equal to the expected term of the grant or purchase right. The risk-free interest rate is based on the yield available on U.S. Treasury Strips with an equivalent remaining term. The expected term of employee stock options represents the weighted-average period that the stock options are expected to remain outstanding and was determined based on historical experience of similar awards, giving consideration to the contractual terms of the equity-based awards and vesting schedules. The expected term of purchase rights represents the period of time remaining in the current offering period.

9

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

The dividend yield assumption is based on Intevac’s history of not paying dividends and the assumption of not paying dividends in the future.

Stock Option Exchange Program

During our Annual Stockholder’s Meeting held on May 9, 2013, our stockholders approved a one-time Employee Stock Option Exchange Program (the “Exchange Program”) pursuant to which eligible employees were provided an opportunity to exchange, on a grant-by-grant basis, eligible outstanding stock options for a lesser number of new options, to be granted under our 2012 Equity Incentive Plan. Options eligible for the Exchange Program are those that were granted prior to the 12-month period preceding the start of the Exchange Program offering period, and have exercise prices per share that are greater than $8.49, 50% above our closing per share stock price measured as of July 5, 2013 which is shortly before the start of the Exchange Program. The Exchange Program offering period commenced on July 6, 2013 and closed on August 6, 2013, at which time a total of 87 eligible option holders exchanged 766,000 outstanding stock options for 336,000 stock options.

The Exchange Program was launched to increase the intended retention and incentive value of employee equity awards, reduce the potential dilutive effect of our equity incentive program, and reduce pressure to grant additional equity awards to employees in the short term. Participation in the Exchange Program was made available to all employees in the United States and Singapore except for the Named Executive Officers. Non-employee members of our board of directors were also not eligible to participate. The exchange of options under the Exchange Program resulted in a total incremental charge to compensation expense of $126,000. This incremental charge is being recognized over the vesting periods of the new options. These vesting periods range from one to three years beginning on the first anniversary of the grant.

RSUs

A summary of the RSU activity is as follows:

	Shares			Weighted Average Grant Date Fair Value
Non-vested RSUs at December 31, 2012		100,461		$	7.33
Granted		169,637		$	4.51
Vested		(21,327	)	$	7.54
Cancelled and forfeited		(11,922	)	$	6.72
Non-vested RSUs at September 28, 2013		236,849		$	5.32

RSUs are converted into shares of Intevac common stock upon vesting on a one-for-one basis. RSUs typically are scheduled to vest over four years. Vesting of RSUs is subject to the grantee’s continued service with Intevac. The compensation expense related to these awards is determined using the fair market value of Intevac common stock on the date of the grant, and the compensation expense is recognized over the vesting period.

Performance-based RSUs (“performance-based awards”) granted to certain executive officers are also subject to the achievement of specified performance goals. These performance-based awards become eligible to vest only if performance goals are achieved and then actually will vest only if the grantee remains employed by Intevac through each applicable vesting date. The fair value of these performance-based awards is estimated on the date of grant and assumes that the specified performance goals will be achieved. If the goals are achieved, these awards vest over a specified remaining service period, provided that the grantee remains employed by Intevac through each scheduled vesting date. If the performance goals are not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. The expected cost of each award is reflected over the service period and is reduced for estimated forfeitures. For performance-based awards granted during fiscal 2013, the performance goals require the achievement of targeted revenues and adjusted annual operating profit levels measured at the end of two and three-year periods.

10

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

5. Allowance for Doubtful Accounts

The following table represents a reconciliation of the allowance for doubtful accounts for the three and nine months ended September 29, 2012:

	Three Months Ended			Nine Months Ended
	September 29, 2012
	(In thousands)
Opening balance	$	—		$	41
Bad debt expense		3,017			3,017
Write-offs		(3,017	)		(3,058	)
Closing balance	$	—		$	—

Intevac held a promissory note from a customer which was secured by the equipment sold to this customer in a prior year under a product and sales agreement. The note was to be repaid in monthly installment payments ending in March 2015. The revenue associated with this sale had been accounted for under the installment method of accounting whereby revenue was recognized only to the extent cash had been received. During the quarter ended September 29, 2012, the customer became delinquent in its monthly installment payments and the note was put on non-accrual status. On September 27, 2012, the customer liquidated its operating assets in an auction. The equipment which collateralized the promissory note was sold in the liquidation auction and Intevac received the proceeds. On September 28, 2012, the customer announced that it was discontinuing its operations effective October 9, 2012 and Intevac concluded that none of the carrying value of the promissory note receivable was collectible and recorded a bad debt charge.

Intevac evaluates the collectibility of trade accounts receivables and notes receivable on an ongoing basis and provides reserves against potential losses when appropriate. Management analyzes historical bad debts, customer concentrations, customer creditworthiness, changes in customer payment tendencies and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. Customer accounts are written off against the allowance when the amount is deemed uncollectible.

The following table summarizes the components of the bad debt expense for the three- and nine month periods ended September 29, 2012 (in thousands):

Promissory note	$	4,085
Deferred profit on installment sale		(1,028	)
Cash recovery from liquidation sale		(40	)
Bad debt expense	$	3,017

The Company did not record any bad debt expense during the nine months ended September 28, 2013.

6. Purchased Intangible Assets

Intevac’s indefinite-lived intangible asset consisted of in-process research and development (“IPR&D”) in the amount of $4.0 million in the Equipment segment. During the quarter ended June 29, 2013, the related development project was completed, the product achieved commercialization and Intevac began amortizing the intangible asset over its expected useful life of 7 years. Immediately prior to commencement of amortization Intevac tested the intangible asset for impairment and determined that it was not impaired.

11

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

Details of finite-lived intangible assets by segment as of September 28, 2013, are as follows.

	September 28, 2013
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
	(In thousands)
Equipment	$	7,170	$	(2,551	)	$	4,619
Intevac Photonics		1,215		(654	)		561
	$	8,385	$	(3,205	)	$	5,180

Total amortization expense of finite-lived intangibles for the three and nine months ended September 28, 2013 was $279,000 and $598,000.

As of September 28, 2013, future amortization expense is expected to be as follows.

(In thousands)
2013	$	279
2014		934
2015		854
2016		853
2017		757
Thereafter		1,503
	$	5,180

7. Acquisition-Related Contingent Consideration

In connection with the acquisition of Solar Implant Technologies, Inc. (“SIT”), Intevac agreed to pay up to an aggregate of $7.0 million in cash to the selling shareholders if certain milestones were achieved over a specified period. Intevac has made payments to the selling shareholders for achievement of the first milestone in 2011 and for achievement of the second and third milestones in 2012. The fourth and final milestone was not achieved on the targeted date outlined in the acquisition agreement and will not be paid. There is no remaining contingent consideration obligation associated with the milestone payments at September 28, 2013.

In connection with the acquisition of SIT, Intevac also agreed to pay to the selling shareholders in cash a revenue earnout on Intevac’s net revenue from commercial sales of certain products over a specified period up to an aggregate of $9.0 million. Intevac estimated the fair value of this contingent consideration on September 28, 2013 based on probability-based forecasted revenues reflecting Intevac’s own assumptions concerning future revenue from such products. As of September 28, 2013, payments made in connection with the revenue earnout obligation have not been significant.

The fair value measurement of contingent consideration is based on significant inputs not observed in the market and thus represents a Level 3 measurement. Any change in fair value of the contingent consideration subsequent to the acquisition date is recognized in operating income within the statement of operations. The following table represents a reconciliation of the change in the fair value measurement of the contingent consideration liability for the three and nine month periods ended September 28, 2013 and September 29, 2012.

12

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(In thousands)
Opening balance	$	4,942		$	6,969		$	5,151		$	8,715
Changes in fair value		185			(200	)		(24	)		443
Cash payments made		(40	)		(956	)		(40	)		(3,345	)
Closing balance	$	5,087		$	5,813		$	5,087		$	5,813

The following table displays the balance sheet classification of the contingent consideration liability account at September 28, 2013 and at December 31, 2012:

	September 28,		December 31,
	2013		2012
	(In thousands)
Other accrued liabilities	$	42	$	265
Other long-term liabilities		5,045		4,886
Total acquisition-related contingent consideration	$	5,087	$	5,151

The following table represents the quantitative range of the significant unobservable inputs used in the calculation of fair value of the continent consideration liability as of September 28, 2013. Significant increases or decreases in any of these inputs in isolation would result in a significantly lower (higher) fair value measurement.

	Quantitative Information about Level 3 Fair Value Measurements at September  28, 2013
	Fair Value	Valuation Technique	Unobservable Input	Range (Weighted Average)
	(In thousands, except for percentages)
Revenue Earnout	$    5,087	Discounted cash flow	Weighted average cost of capital	16.0%
			Probability weighting of achieving revenue forecasts	15.0% - 50.0% (31.7%)

8. Divestitures

Sale of DeltaNu

On March 29, 2013, the Company sold certain assets, including existing tangible and intangible assets, which comprised its Raman spectroscopy instruments product line, also known as DeltaNu, for consideration not to exceed $1.5 million. Under the terms of the agreement, the acquirer also assumed certain liabilities related to the purchased assets. Payment terms included $500,000 which was paid on the closing date, with the remaining balance to be paid in the form of an earnout of 5% of the acquirer’s Raman spectroscopy instrument sales for 5 years following the closing date which will be due and payable on or before each anniversary of the closing date or a minimum earnout payment of $100,000 annually, whichever is higher. The maximum earnout payments during the payment period shall not exceed $1.0 million.

As the earnout is collected over an extended period of time and in management’s judgment the degree of collectibility is uncertain, Intevac did not recognize the minimum earnout payments upon closing, but instead will record income in the period when the minimum earnout payments can be reasonably estimated for that period and payment is assured.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

The following table summarizes the components of the loss (in thousands):

Cash proceeds	$	500
Assets sold:
Accounts receivable		147
Inventories		320
Other current assets		27
Property, plant and equipment		159
Trade name		90
Total assets sold		743
Liabilities divested:
Accounts payable		59
Other accrued expenses		6
Total liabilities divested		65
Transaction and other costs		30
Loss on sale	$	(208	)

Sale of Mainframe Technology

On January 6, 2012, the Company sold certain assets including intellectual property and residual assets which comprised its semiconductor mainframe technology.

The following table summarizes the components of the gain (in thousands):

Cash proceeds	$	3,000
Assets sold:
Inventories		589
Property, plant and equipment		178
Transaction and other costs		26
Gain on sale	$	2,207

9. Warranty

Intevac provides for the estimated cost of warranty when revenue is recognized. Intevac’s warranty is per contract terms, and for systems sold directly the warranty typically ranges between 12 and 24 months from customer acceptance. For systems sold through a distributor, Intevac offers a 3 month warranty. The remainder of any warranty period is the responsibility of the distributor. During this warranty period any defective non-consumable parts are replaced and installed at no charge to the customer. The warranty period on consumable parts is limited to their reasonable usable lives. Intevac uses estimated repair or replacement costs along with its historical warranty experience to determine its warranty obligation. Intevac generally provides a twelve month warranty on its Intevac Photonics products. The provision for the estimated future costs of warranty is based upon historical cost and product performance experience. Intevac exercises judgment in determining the underlying estimates.

On the condensed consolidated balance sheets, the short-term portion of the warranty provision is included in other accrued liabilities, while the long-term portion is included in other long-term liabilities. The expense associated with product warranties issued or adjusted is included in cost of net revenues on the condensed consolidated statements of operations.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

The following table displays the activity in the warranty provision account for the three and nine months ended September 28, 2013 and September 29, 2012:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(In thousands)
Opening balance	$	2,087		$	2,858		$	2,349		$	2,724
Expenditures incurred under warranties		(309	)		(197	)		(773	)		(1,388	)
Accruals for product warranties issued during the reporting period		323			218			861			1,093
Adjustments to previously existing warranty accruals		(37	)		(330	)		(373	)		120
Closing balance	$	2,064		$	2,549		$	2,064		$	2,549

The following table displays the balance sheet classification of the warranty provision account at September 28, 2013 and at December 31, 2012:

	September 28,		December 31,
	2013		2012
	(In thousands)
Other accrued liabilities	$	1,974	$	2,259
Other long-term liabilities		90		90
Total warranty provision	$	2,064	$	2,349

10. Guarantees

Officer and Director Indemnifications

As permitted or required under Delaware law and to the maximum extent allowable under that law, Intevac has certain obligations to indemnify its current and former officers and directors for certain events or occurrences while the officer or director is, or was serving, at Intevac’s request in such capacity. These indemnification obligations are valid as long as the director or officer acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Company and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. The maximum potential amount of future payments Intevac could be required to make under these indemnification obligations is unlimited; however, Intevac has a director and officer insurance policy that mitigates Intevac’s exposure and enables Intevac to recover a portion of any future amounts paid. As a result of Intevac’s insurance policy coverage, Intevac believes the estimated fair value of these indemnification obligations is not material.

Other Indemnifications

As is customary in Intevac’s industry, many of Intevac’s contracts provide remedies to certain third parties such as defense, settlement, or payment of judgments for intellectual property claims related to the use of its products. Such indemnification obligations may not be subject to maximum loss clauses. Historically, payments made related to these indemnifications have been immaterial.

15

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

11. Cash, Cash Equivalents and Investments

Cash and cash equivalents, short-term investments and long-term investments consist of:

	September 28, 2013
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Fair Value
	(In thousands)
Cash and cash equivalents:
Cash	$	6,158	$	—	$	—	$	6,158
Money market funds		10,468		—		—		10,468
Total cash and cash equivalents	$	16,626	$	—	$	—	$	16,626
Short-term investments:
Commercial paper	$	997	$	—	$	—	$	997
Corporate bonds and medium-term notes		21,930		23		3		21,950
Municipal bonds		6,113		2		1		6,114
U.S. treasury and agency securities		19,199		13		—		19,212
Variable rate demand notes (“VRDNs”)		160		—		—		160
Total short-term investments	$	48,399	$	38	$	4	$	48,433
Long-term investments:
Corporate bonds and medium-term notes	$	15,576	$	9	$	3	$	15,582
Municipal bonds		1,065		2		—		1,067
U.S. treasury and agency securities		4,008		4		—		4,012
Total long-term investments	$	20,649	$	15	$	3	$	20,661
Total cash, cash equivalents, and investments	$	85,674	$	53	$	7	$	85,720

16

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

	December 31. 2012
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Fair Value
	(In thousands)
Cash and cash equivalents:
Cash	$	5,939	$	—	$	—	$	5,939
Money market funds		18,322		—		—		18,322
Total cash and cash equivalents	$	24,261	$	—	$	—	$	24,261
Short-term investments:
Commercial paper	$	2,495	$	—	$	—	$	2,495
Corporate bonds and medium-term notes		19,539		13		4		19,548
Municipal bonds		1,203		1		—		1,204
U.S. treasury and agency securities		16,976		23		—		16,999
VRDNs		345		—		—		345
Total short-term investments	$	40,558	$	37	$	4	$	40,591
Long-term investments:
Corporate bonds and medium-term notes	$	16,776	$	33	$	7	$	16,802
Municipal bonds		1,000		2		—		1,002
U.S. treasury and agency securities		9,499		14		—		9,513
Total long-term investments	$	27,275	$	49	$	7	$	27,317
Total cash, cash equivalents, and investments	$	92,094	$	86	$	11	$	92,169

The contractual maturities of available-for-sale securities at September 28, 2013 are presented in the following table.

	Amortized Cost		Fair Value
	(In thousands)
Due in one year or less	$	55,702	$	55,734
Due after one through two years		22,654		22,668
Due after ten years		1,160		1,160
	$	79,516	$	79,562

The following table provides the fair market value of Intevac’s investments with unrealized losses that are not deemed to be other-than temporarily impaired as of September 28, 2013.

	September 28, 2013
	In Loss Position for Less than 12 Months				In Loss Position for Greater than 12 Months
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(In thousands)
Corporate bonds and medium-term notes	$	7,802	$	6	$	—	$	—
Municipal bonds		3,112		1		—		—
	$	10,914	$	7	$	—	$	—

17

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

All prices for the fixed maturity securities including U.S. Treasury and agency securities, commercial paper, corporate bonds, VRDNs and municipal bonds are received from independent pricing services utilized by Intevac’s outside investment manager. This investment manager performs a review of the pricing methodologies and inputs utilized by the independent pricing services for each asset type priced by the vendor. In addition, on at least an annual basis, the investment manager conducts due diligence visits and interviews with each pricing vendor to verify the inputs utilized for each asset class. The due diligence visits include a review of the procedures performed by each vendor to ensure that pricing evaluations are representative of the price that would be received to sell a security in an orderly transaction. Any pricing where the input is based solely on a broker price is deemed to be a Level 3 price. Intevac uses the pricing data obtained from its outside investment manager as the primary input to make its assessments and determinations as to the ultimate valuation of the above-mentioned securities and has not made, during the periods presented, any material adjustments to such inputs.

The following table represents the fair value hierarchy of Intevac’s available-for-sale securities measured at fair value on a recurring basis as of September 28, 2013.

	Fair Value Measurements at September 28, 2013
	Total		Level 1		Level 2
	(In thousands)
Recurring fair value measurements:
Available-for-sale securities
Money market funds	$	10,468	$	10,468	$	—
U.S. treasury and agency securities		23,224		8,703		14,521
Commercial paper		997		—		997
Corporate bonds and medium-term notes		37,532		—		37,532
Municipal bonds		7,181		—		7,181
VRDNs		160		—		160
Total recurring fair value measurements	$	79,562	$	19,171	$	60,391

The following table presents the changes in Level 3 instruments which consisted of Auction Rate Securities (“ARS”) which were classified as available-for-sale securities and which were measured on a recurring basis for the nine month period ended September 29, 2012.

(In thousands)
Opening balance	$	4,490
Total gains (losses) for the period
Included in earnings		(229	)
Included in other comprehensive income		171
Proceeds from tender offers		(2,771	)
Closing balance	$	1,661

The Company did not hold any ARS as of or during the nine months ended September 28, 2013.

12. Derivative Instruments

The Company uses foreign currency forward contracts to mitigate variability in gains and losses generated from the re-measurement of certain monetary assets and liabilities denominated in foreign currencies. These hedges do not qualify for special hedge accounting treatment. These derivatives are carried at fair value with changes recorded in

18

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

interest income and other, net in the condensed consolidated statements of operations. Changes in the fair value of these derivatives are largely offset by re-measurement of the underlying assets and liabilities. Cash flows from such derivatives are classified as operating activities. The derivatives have maturities of approximately thirty and sixty days. The notional amount of Company’s foreign currency derivatives was $1.7 million at September 28, 2013 and $491,000 at December 31, 2012.

13. Accumulated Other Comprehensive Income

The changes in accumulated other comprehensive income by component for the three and nine months ended September 28, 2013, are as follows.

	Foreign currency			Unrealized holding gains on available- for-sale investments			Total
	(In thousands)
Balance at December 31, 2012	$	694		$	75		$	769
Other comprehensive loss before reclassification		(6	)		(15	)		(21	)
Amounts reclassified from other comprehensive income		—			—			—
Net current-period other comprehensive loss		(6	)		(15	)		(21	)
Balance at March 30, 2013	$	688		$	60		$	748
Other comprehensive loss before reclassification		(4	)		(74	)		(78	)
Amounts reclassified from other comprehensive income		—			—			—
Net current-period other comprehensive loss		(4	)		(74	)		(78	)
Balance at June 29, 2013	$	684		$	(14	)	$	670
Other comprehensive income (loss) before reclassification		3			60			63
Amounts reclassified from other comprehensive income		—			—			—
Net current-period other comprehensive income (loss)		3			60			63
Balance at September 28, 2013	$	687		$	46		$	733

14. Net Loss Per Share

The following table sets forth the computation of basic and diluted loss per share:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(in thousands, except per share amounts)
Net loss	$	(2,745	)	$	(8,007	)	$	(17,421	)	$	(12,661	)
Weighted-average shares — basic		23,931			23,397			23,793			23,293
Effect of dilutive potential common shares		—			—			—			—
Weighted-average shares — diluted		23,931			23,397			23,793			23,293
Net loss per share — basic and diluted	$	(0.11	)	$	(0.34	)	$	(0.73	)	$	(0.54	)
Antidilutive shares based on employee awards excluded		2,551			3,175			2,648			2,999

Potentially dilutive common shares consist of shares issuable upon exercise of employee stock options and vesting of RSUs and are excluded from the calculation of diluted EPS when their effect would be anti-dilutive.

19

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

15. 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 September 28, 2013 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 markets vacuum process equipment solutions for high-volume manufacturing of small substrates with precise thin film properties for hard drive and solar cell manufacturers.

The Intevac Photonics segment develops compact, cost-effective, high-sensitivity digital-optical products for the capture and display of low-light images. Intevac provides sensors, cameras and systems for government applications such as night vision and long-range target identification.

Information for each reportable segment for the three and nine months ended September 28, 2013 and September 29, 2012 is as follows:

Net Revenues

	Three Months Ended				Nine Months Ended
	September 28, 2013		September 29, 2012		September 28, 2013		September 29, 2012
	(in thousands)
Equipment	$	11,760	$	7,401	$	26,293	$	43,179
Intevac Photonics		7,355		9,433		22,788		22,762
Total segment net revenues	$	19,115	$	16,834	$	49,081	$	65,941

20

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

Operating Income (Loss)

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(in thousands)
Equipment	$	(1,423	)	$	(10,298	)	$	(14,607	)	$	(15,493	)
Intevac Photonics		192			717			254			(939	)
Total segment operating income (loss)		(1,231	)		(9,581	)		(14,353	)		(16,432	)
Unallocated costs		(1,751	)		(1,429	)		(4,436	)		(4,417	)
Gain (loss) on divestitures		—			—			(208	)		2,207
Loss from operations		(2,982	)		(11,010	)		(18,997	)		(18,642	)
Interest income and other, net		220			(8	)		392			411
Loss before income taxes	$	(2,762	)	$	(11,018	)	$	(18,605	)	$	(18,231	)

Total assets for each reportable segment as of September 28, 2013 and December 31, 2012 are as follows:

Assets

	September 28, 2013		December 31, 2012
	(In thousands)
Equipment	$	39,825	$	37,376
Intevac Photonics		19,847		27,052
Total segment assets		59,672		64,428
Cash, cash equivalents and investments		85,720		92,169
Deferred income taxes		13,189		12,176
Other current assets		1,011		1,870
Common property, plant and equipment		1,283		1,211
Other assets		478		649
Consolidated total assets	$	161,353	$	172,503

16. Restructuring Charges

On February 1, 2013, Intevac announced the 2013 cost reduction plan (the “Plan”) to reduce expenses including a reduction in its workforce. Implementation of the Plan was substantially completed in the first half of fiscal 2013 and the Company reduced its workforce by 18 percent. The cost of implementing the Plan was reported under cost of products sold and operating expenses in the condensed consolidated statements of operations. Substantially all cash outlays in connection with the Plan occurred in the first half of fiscal 2013. Implementation of the Plan is expected to reduce salary, wages and other employee-related expenses by approximately $5.5 million to $6.0 million on an annual basis.

21

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

The changes in restructuring reserves associated with the Plan for the nine months ended September 28, 2013, are as follows.

	Severance and other employee- related costs
	(In thousands)
Balance at December 31, 2012	$	—
Provision for restructuring reserves		742
Cash payments made		(742	)
Balance at September 28, 2013	$	—

17. Income Taxes

Intevac recorded income tax benefits of $17,000 and $1.2 million for the three and nine months ended September 28, 2013, respectively. Intevac recorded income tax benefits of $3.0 million and $5.6 million for the three and nine months ended September 29, 2012, respectively. The income tax provision for the three and nine month periods are based upon estimates of annual income (loss), annual permanent differences and statutory tax rates in the various jurisdictions in which Intevac operates, except that certain discrete items are treated separately. At the end of 2012 Intevac established a valuation allowance against the majority of the U.S. deferred tax assets. As a result, Intevac did not recognize a benefit on the U.S. net operating loss for the three and nine months ended September 28, 2013.

The income tax benefit for both the three and nine month periods ended September 28, 2013 includes a $213,000 tax benefit from the release of certain unrecognized tax benefit liabilities due to the lapse of statutes of limitation. The income tax benefit for the three and nine month periods ended September 28, 2013 was reduced by discrete income tax charges for accrued withholding tax in Singapore of $147,000 and $231,000, respectively. The income tax benefit for the nine months ended September 29, 2012 includes the following discrete income tax items: (i) $1.1 million tax benefit related to a bad debt write-off, (ii) $108,000 tax benefit from the release of a valuation allowance and (iii) $188,000 in tax refunds received from Singapore and California, which were offset in part by (iv) $554,000 discrete income tax charge related to the gain on the sale of the mainframe technology.

Intevac’s tax rate differs from the applicable statutory rates due primarily to establishment of valuation allowances, the utilization of deferred and current credits and the effect of permanent differences and adjustments of prior permanent differences. Intevac’s future effective income tax rate depends on various factors including, the level of Intevac’s projected earnings, the geographic composition of worldwide earnings, tax regulations governing each region, net operating loss carry-forwards, availability of tax credits and the effectiveness of Intevac’s tax planning strategies. Management carefully monitors these factors and timely adjusts the effective income tax rate accordingly.

Intevac has benefitted from a tax holiday in Singapore which is scheduled to expire at the end of 2015. The tax holiday provides a lower income tax rate on certain classes of income so long as certain thresholds of business investment and employment levels are met in Singapore. We are presently in discussion with the Singapore tax authority to terminate this tax holiday effective January 1, 2013 due to current conditions in the hard disk drive business, which will not allow Intevac to be able to meet the conditions required to continue benefitting from the tax holiday. We expect the Singapore tax authorities to issue the terms and conditions allowing us to terminate the tax holiday early during the fourth quarter of 2013.

Intevac is subject to income taxes in the U.S. federal jurisdiction, and various state and foreign jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, Intevac is not subject to U.S. federal, state and local, or international jurisdictions income tax examinations by tax authorities for the years before 2010. Tax years 1999 through 2010 are subject to income tax examinations by U.S. federal and California tax authorities to the extent of tax credit carry forwards remaining or utilized in an otherwise open year. Tax years 2010 through 2012 generally

22

INTEVAC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

remain open for examinations by the tax authorities. During 2012, the Internal Revenue Service completed its review of the Company’s fiscal year 2009 tax return which arose from an income tax refund generated by a carry-back claim. Additionally, the Singapore Inland Revenue Authority is conducting an examination of the fiscal 2009 and 2010 tax returns of the Company’s wholly-owned subsidiary, Intevac Asia Pte. Ltd. Presently there are no other active income tax examinations in the jurisdictions where Intevac operates.

18. Contingencies

From time to time, Intevac may have certain contingent liabilities that arise in the ordinary course of its business activities. Intevac accounts for contingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated.

23

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Quarterly Report on Form 10-Q contains forward-looking statements, which involve risks and uncertainties. Words such as “believes,” “expects,” “anticipates” and the like indicate forward-looking statements. These forward-looking statements include comments related to Intevac’s shipments, projected revenue recognition, product costs, gross margin, operating expenses, interest income, income taxes, cash balances and financial results in 2013 and beyond; projected customer requirements for Intevac’s new and existing products, and when, and if, Intevac’s customers will place orders for these products; Intevac’s ability to proliferate its Photonics technology into major military programs and to develop and introduce commercial imaging products; the timing of delivery and/or acceptance of the systems and products that comprise Intevac’s backlog for revenue and the Company’s ability to achieve cost savings. Intevac’s actual results may differ materially from the results discussed in the forward-looking statements for a variety of reasons, including those set forth under “Risk Factors” and in other documents we file from time to time with the Securities and Exchange Commission, including our Annual Report on Form 10-K filed on February 22, 2013, and our periodic Form 10-Q’s and Form 8-K’s.

Overview

Intevac provides process manufacturing equipment solutions to the hard disk drive industry and high-productivity process manufacturing equipment to the photovoltaic (“PV”) industry. Intevac also provides sensors, cameras and systems for government applications such as night vision and long-range target identification. Intevac’s customers include manufacturers of hard disk drives and PV cells as well as the U.S. government and its agencies and contractors. Intevac reports two segments: Equipment and Intevac Photonics. During the first quarter of 2012, Intevac sold certain assets comprising its semiconductor mainframe technology. During the third quarter of 2012, Intevac wrote-off a promissory note receivable and a deferred profit liability related to certain thin-film PV equipment sold in a previous year due to the insolvency of the customer. During the first quarter of 2013, Intevac sold certain assets comprising its Raman spectroscopy instruments product line, also known as DeltaNu. During the first quarter of 2013, Intevac also announced a cost reduction plan and reduced its workforce by 18 percent during the first half of the year.

Product development and manufacturing activities occur in North America and Asia. Intevac has field offices in Asia to support its equipment customers. Intevac’s equipment and service products are highly technical and are sold primarily through Intevac’s direct sales force. Intevac also sells its products through distributors in Japan and China.

Intevac’s Equipment results are driven by worldwide demand for hard disk drives, which in turn depends on the growth in digital data creation and storage, the rate of areal density improvements, the end-user demand for personal computers, enterprise data storage, including on-line, cloud storage and near-line applications, personal audio and video players and video game platforms that include such drives. Demand for Intevac’s equipment is impacted by Intevac’s customers’ relative market share positions and production capacity needs. Intevac continues to execute its strategy of equipment diversification into new markets and has introduced products for PV solar cell manufacturing. Intevac believes that expansion into this market will result in incremental equipment revenues for Intevac and decrease Intevac’s dependence on the hard disk drive industry. Intevac’s equipment business is subject to cyclical industry conditions, as demand for manufacturing equipment and services can change depending on supply and demand for hard disk drives and PV cells, as well as other factors such as global economic conditions and technological advances in fabrication processes. Intevac Photonics’ results are driven by the proliferation of Intevac’s technology into major military programs, continued defense spending, the ability to obtain export licenses for foreign customers, obtaining production subcontracts for these programs, and Intevac’s development and market acceptance of commercial products.

24

The following table presents certain significant measurements for the three and nine months ended September 28, 2013 and September 29, 2012:

	Three months ended								Nine months ended
	September 28, 2013			September 29, 2012			Change over prior period		September 28, 2013			September 29 2012			Change over prior period
	(In thousands, except percentages and per share amounts)
Net revenues	$	19,115		$	16,834		$	2,281	$	49,081		$	65,941		$	(16,860	)
Gross profit	$	6,895		$	5,732		$	1,163	$	14,237		$	26,811		$	(12,574	)
Gross margin percent		36.1	%		34.1	%		2.0 points		29.0	%		40.7	%		(11.7) points
Net loss	$	(2,745	)	$	(8,007	)	$	5,262	$	(17,421	)	$	(12,661	)	$	(4,760	)
Loss per diluted share	$	(0.11	)	$	(0.34	)	$	0.23	$	(0.73	)	$	(0.54	)	$	(0.19	)

Financial results for the third quarter of fiscal 2013 improved compared to the same period in the prior year. Net revenues increased for the third quarter of fiscal 2013 compared to the same period in the prior year primarily due to higher equipment sales to disk manufacturers offset by lower Intevac Photonics’ contract research and development (“R&D”). Intevac recognized revenue on one 200 Lean^® system in the third quarter of 2013 and did not recognize revenue on any 200 Lean systems in the third quarter of 2012. The net loss for the third quarter of fiscal 2013 decreased compared to the same period in the prior year due to higher revenues, higher gross margins and lower operating expenses as a result of savings from the cost reduction program implemented during the first half of 2013 and costs recovered under a non-recurring engineering (“NRE”) arrangement, offset in part by recognition of a smaller income tax benefit. Also the third quarter of fiscal 2012 included a bad debt charge of $3.0 million which did not re-occur in fiscal 2013. Financial results for the first nine months of fiscal 2013 declined compared to the same period in the prior year. Net revenues decreased for the first nine months of fiscal 2013 compared to the same period in the prior year due to lower equipment sales to disk manufacturers. The net loss for the first nine months of fiscal 2013 increased compared to the same period in the prior year due to lower revenues and lower gross margins and recognition of a smaller income tax benefit, offset in part by lower operating expenses. Also in the first nine months of fiscal 2012, Intevac recognized a gain on the sale of its semiconductor mainframe technology in the amount of $2.2 million which did not re-occur in fiscal 2013. The income tax benefit declined from $5.6 million in the prior year to $1.2 million in the first nine months of fiscal 2013 primarily due to the fact that Intevac did not recognize a benefit on the U.S. net operating loss in the first nine months of fiscal 2013.

In the remainder of fiscal 2013, Intevac expects that the effect of macro-economic environment conditions on demand for personal computers for both consumers and corporations, the transition to centralized or “cloud” storage and the proliferation of tablets will continue to negatively impact the hard drive equipment business. The Company therefore expects that shipments of Intevac equipment to hard disk drive manufacturers will be approximately at the same levels as fiscal 2012. In the remainder of fiscal 2013, Intevac also expects sales of PV equipment to solar cell manufacturers will be relatively flat compared to fiscal 2012. Intevac expects that capital spending for the solar cell manufacturing market will remain at these low levels through the remainder of 2013 and into 2014. For the remainder of fiscal 2013, Intevac expects that Intevac Photonics business levels will be relatively flat as compared to 2012 as the business completes its major contract with the U.S. Army to develop a pilot night vision system for the Apache helicopter in advance of the first large scale production shipments that will begin in late 2013.

Intevac’s trademarks include the following: “200 Lean^®,” “AccuLuber™,” “EBAPS^®,” “ENERGi™,” “I-Port™,” “LEAN SOLAR™,” “LithoPrime™,” “LIVAR^®,” “MicroVista^®,” “NanoVista™”, “LEAN SOLAR NanoTexture™,” “NightVista^®,” and “Night Port™^”.

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Results of Operations

Net revenues

	Three months ended							Nine months ended
	September 28, 2013		September 29, 2012		Change over prior period			September 28, 2013		September 29, 2012		Change over prior period
	(In thousands)
Equipment	$	11,760	$	7,401	$	4,359		$	26,293	$	43,179	$	(16,886	)
Intevac Photonics
Contract R&D	$	3,124	$	5,169	$	(2,045	)	$	10,970	$	10,874	$	96
Products		4,231		4,264		(33	)		11,818		11,888		(70	)
		7,355		9,433		(2,078	)		22,788		22,762		26
Total net revenues	$	19,115	$	16,834	$	2,281		$	49,081	$	65,941	$	(16,860	)

Equipment revenue for the three months ended September 28, 2013 increased compared to the same period in the prior year as a result of higher sales of disk sputtering systems and technology upgrades, offset in part by lower sales of disk lubrication systems and spare parts. During the third quarter of 2013 Intevac recognized revenue on one 200 Lean system, disk equipment technology upgrades, and spare parts. During the third quarter of 2012 Intevac recognized revenue on AccuLuber^TM systems, disk equipment technology upgrades, and spare parts. Equipment revenue for the nine months ended September 28, 2013 decreased over the same period in the prior year as a result of lower sales of disk sputtering systems, disk lubrication systems, technology upgrades and spare parts. Equipment revenue for the nine months ended September 28, 2013 included revenue recognition for one 200 Lean system, one solar implant ENERGi™ system, AccuLuber systems, upgrades and spare parts. Equipment revenue for the nine months ended September 29, 2012 included revenue recognition for two 200 Lean systems, AccuLuber systems, one LEAN SOLAR NanoTexture™ etch system, upgrades and spare parts.

Intevac Photonics revenue for the three months ended September 28, 2013 decreased over the same period in the prior year as a result of lower contract R&D work as the business completed several contracts during 2013. Intevac Photonics revenue for the nine months ended September 28, 2013 was relatively flat compared to the same period in the prior year. Both the three and nine month periods ended September 28, 2013 reflected lower sales of Raman spectroscopy products compared to the same periods in the prior year. On March 29, 2013, Intevac sold certain assets comprising its Raman spectroscopy instruments product line, also known as DeltaNu, and no longer offers Raman spectroscopy products.

Backlog

	September 28, 2013		December 31, 2012		September 29, 2012
	(In thousands)
Equipment	$	19,759	$	8,902	$	15,729
Intevac Photonics		50,988		26,282		24,315
Total backlog	$	70,747	$	35,184	$	40,044

Equipment backlog at September 28, 2013 included two 200 Lean systems. Equipment backlog at December 31, 2012 and September 29, 2012 did not include any 200 Lean systems. Photonics backlog at September 28, 2013 includes $24.6 million in revenue that will be earned beyond the next twelve months.

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Revenue by geographic region

	Three months ended							Nine months ended
	September 28, 2013		September 29, 2012		Change over prior period			September 28, 2013		September 29, 2012		Change over prior period
	(In thousands)
United States	$	7,306	$	9,949	$	(2,643	)	$	24,352	$	22,607	$	1,745
Asia		10,127		5,421		4,706			20,495		39,349		(18,854	)
Europe		1,682		670		1,012			4,234		3,188		1,046
Rest of world		—		794		(794	)		—		797		(797	)
Total net revenues	$	19,115	$	16,834	$	2,281		$	49,081	$	65,941	$	(16,860	)

The decrease in U.S. sales for the three months ended September 28, 2013 was primarily due to lower contract R&D. The increase in U.S. sales for the nine months ended September 28, 2013 was primarily due to higher U.S. sales of technology upgrades. International sales include products shipped to overseas operations of U.S. companies. The increase in sales to the Asia region for the three months ended September 28, 2013 was primarily due to an increase in net revenues from disk sputtering systems and technology upgrades. The decrease in sales to the Asia region for the nine months ended September 28, 2013 was primarily due to a decrease in net revenues from disk sputtering systems, disk lubrication systems and technology upgrades. The increase in sales to the Europe region for the three and nine months ended September 28, 2013 was primarily due to higher sales of Intevac Photonics’ digital night-vision cameras to a NATO customer. The mix of domestic versus international sales will change from period to period depending on the location of Intevac’s largest customers in each period.

Gross profit

	Three months ended									Nine months ended
	September 28, 2013			September 29, 2012			Change over prior period			September 28, 2013			September 29, 2012			Change over prior period
	(In thousands, except percentages)
Equipment gross profit	$	4,664		$	2,637		$	2,027		$	7,218		$	19,285		$	(12,067	)
% of Equipment net revenues		39.7	%		35.6	%					27.4	%		44.7	%
Intevac Photonics gross profit	$	2,231		$	3,095		$	(864	)	$	7,019		$	7,526		$	(507	)
% of Intevac Photonics net revenues		30.3	%		32.8	%					30.8	%		33.1	%
Total gross profit	$	6,895		$	5,732		$	1,163		$	14,237		$	26,811		$	(12,574	)
% of net revenues		36.1	%		34.1	%					29.0	%		40.7	%

Cost of net revenues consists primarily of purchased materials and costs attributable to contract research and development, and also includes fabrication, assembly, test and installation labor and overhead, customer-specific engineering costs, warranty costs, royalties, provisions for inventory reserves and scrap.

Equipment gross margin was 39.7% in the three months ended September 28, 2013 compared to 35.6% in the three months ended September 29, 2012 and was 27.4% in the nine months ended September 28, 2013 compared to 44.7% in the nine months ended September 29, 2012. The higher gross margin for the three months ended September 28, 2013 was due primarily to higher revenues, product mix which included higher-margin upgrades, and higher factory utilization. The lower gross margin for the nine months ended September 28, 2013 was due primarily to lower revenues and lower factory utilization. Gross margins in the Equipment business will vary depending on a number of factors, including product mix, product cost, system configuration and pricing, factory utilization, and provisions for excess and obsolete inventory.

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Intevac Photonics gross margin was 30.3% in the three months ended September 28, 2013 compared to 32.8% in the three months ended September 29, 2012 and was 30.8% in the nine months ended September 28, 2013 compared to 33.1% in the nine months ended September 29, 2012. Gross margin percentages declined during the three and nine months ended September 28, 2013 compared to the same periods in the prior year due to lower margins on contract R&D, offset in part by of higher-margin product sales and cost reductions associated with digital night-vision products and warranty. Gross margins in the Intevac Photonics business will vary depending on a number of factors, including product mix, product cost, pricing, factory utilization, and provisions for excess and obsolete inventory.

Research and development

	Three months ended							Nine months ended
	September 28, 2013		September 29, 2012		Change over prior period			September 28, 2013		September 29, 2012		Change over prior period
	(In thousands)
Research and development expense	$	4,250	$	7,336	$	(3,086	)	$	16,192	$	24,812	$	(8,620	)

Research and development spending decreased in Equipment during the three and nine month periods ended September 28, 2013 as compared to the same periods in the prior year. The decrease in Equipment spending was due primarily to decreased PV development and costs recovered under a NRE arrangement. Intevac Photonics research and development spending during the three months ended September 28, 2013 was relatively flat compared to the same period in the prior year. Intevac Photonics research and development spending decreased during the nine months ended September 28, 2013 as compared to the same period in the prior year due to a higher volume of billable contract R&D efforts. Research and development expenses do not include costs of $2.5 million and $8.6 million for the three and nine months ended September 28, 2013 respectively, or $3.6 million and $7.6 million for the three and nine months ended September 29, 2012, respectively, which are related to customer-funded contract R&D programs at Intevac Photonics and therefore included in cost of net revenues.

Selling, general and administrative

	Three months ended							Nine months ended
	September 28, 2013		September 29, 2012		Change over prior period			September 28, 2013		September 29, 2012		Change over prior period
	(In thousands)
Selling, general and administrative expense	$	5,627	$	6,389	$	(762	)	$	16,834	$	19,831	$	(2,997	)

Selling, general and administrative expense consists primarily of selling, marketing, customer support, financial and management costs. The decrease in selling, general and administrative spending in the three and nine months ended September 28, 2013 compared to the three and nine months ended September 29, 2012 was primarily the result of lower charges associated with the change in the fair value of the contingent consideration obligations related to the SIT acquisition, lower equity compensation expense and savings from the global cost reduction program offset in part by increased accruals for variable compensation programs and costs associated with the implementation of the global cost reduction program.

Bad debt expense

During the quarter ended September 29, 2012 Intevac wrote off a promissory note receivable and the related deferred profit liability from the sale of certain thin-film PV equipment in a previous year and incurred bad debt expense of $3.0 million due to the insolvency of the customer. See Note 5 “Allowance for Doubtful Accounts” in the notes to the condensed consolidated financial statements for additional information related to the write-off.

Indefinite-lived intangible asset

Intevac acquired IPR&D of $4.0 million in connection with the acquisition of SIT in November 2010. The fair value of the IPR&D was determined through estimates and valuation techniques based on the terms of the acquisition. This IPR&D was the initial development of Intevac’s ENERGi ion implantation process module for use

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in the manufacturing of PV solar cells. Intevac completed development on this process module during the second quarter of fiscal 2013. Upon completion of development and commercialization of the product, Intevac began amortization of the acquired IPR&D over its expected useful life of 7 years.

Immediately prior to the commencement of amortization, the Company assessed the valuation of the IPR&D from the SIT acquisition. The review involved determining the present value of future cash flows from the resulting product based on estimates, judgments, and assumptions that management believes are appropriate for the circumstances. Based upon updated management projections related to the IPR&D and on a discounted cash flow model, Intevac determined the fair value of the IPR&D exceeded its carrying value and no impairment existed.

2013 cost reduction plan

During the first quarter of fiscal 2013, Intevac announced the 2013 cost reduction plan (the “Plan”) to reduce expenses including a reduction in its workforce. Implementation of the Plan was substantially completed in the first half of fiscal 2013 and the workforce was reduced by 18 percent. The total cost of implementing the Plan was $742,000 of which $315,000 was reported under cost of products sold and $427,000 was reported under operating expenses. Substantially all cash outlays in connection with the Plan occurred in the first half of fiscal 2013. Implementation of the Plan is expected to reduce salary, wages and other employee-related expenses by approximately $5.5 million to $6.0 million on an annual basis.

Gain (loss) on divestitures

On March 29, 2013, the Company sold certain assets, including existing tangible and intangible assets, which comprised its Raman spectroscopy instruments product line, also known as DeltaNu, for consideration not to exceed $1.5 million, of which $500,000 was received in cash upon closing, and recorded a loss of $208,000. On January 6, 2012, the Company sold certain assets, including intellectual property and residual assets, which comprised its semiconductor mainframe technology for $3.0 million in cash and recorded a gain of $2.2 million. See Note 8 “Divestitures” in the notes to the condensed consolidated financial statements for additional information related to the gain (loss) on divestitures.

Interest income and other, net

	Three months ended							Nine months ended
	September 28, 2013		September 29, 2012			Change over prior period		September 28, 2013		September 29, 2012		Change over prior period
	(In thousands)
Interest income and other, net	$	220	$	(8	)	$	228	$	392	$	411	$	(19	)

Interest income and other, net is comprised of interest income and realized gains and losses on sales of investments, foreign currency gains and losses, and other income and expense such as gains and losses on sales of fixed assets.

Income tax provision (benefit)

				Three months ended					Nine months ended
	September 28, 2013			September 29, 2012			Change over prior period		September 28, 2013			September 29, 2012			Change over prior period
	(In thousands)
Income tax benefit	$	(17	)	$	(3,011	)	$	2,994	$	(1,184	)	$	(5,570	)	$	4,386

Intevac recorded income tax benefits of $17,000 and $1.2 million for the three and nine months ended September 28, 2013, respectively. Intevac recorded income tax benefits of $3.0 million and $5.6 million for the three and nine months ended September 29, 2012, respectively. The income tax provision for the three and nine month

29

periods are based upon estimates of annual income (loss), annual permanent differences and statutory tax rates in the various jurisdictions in which Intevac operates, except that certain discrete items are treated separately. At the end of 2012 Intevac established a valuation allowance against the majority of the U.S. deferred tax assets. As a result, Intevac did not recognize a benefit on the U.S. net operating loss for the three and nine months ended September 28, 2013.

The income tax benefit for both the three and nine month periods ended September 28, 2013 includes a $213,000 tax benefit from the release of certain unrecognized tax benefit liabilities due to the lapse of statutes of limitation. The income tax benefit for the three and nine month periods ended September 28, 2013 was reduced by discrete income tax charges for accrued withholding tax in Singapore of $147,000 and $231,000, respectively. The income tax benefit for the nine months ended September 29, 2012 includes the following discrete income tax items: (i) $1.1 million tax benefit related to a bad debt write-off, (ii) $108,000 tax benefit from the release of a valuation allowance and (iii) $188,000 in tax refunds received from Singapore and California, which were offset in part by (iv) $554,000 discrete income tax charge related to the gain on the sale of the mainframe technology.

Intevac’s tax rate differs from the applicable statutory rates due primarily to establishment of valuation allowances, the utilization of deferred and current credits and the effect of permanent differences and adjustments of prior permanent differences. Intevac’s future effective income tax rate depends on various factors including, the level of Intevac’s projected earnings, the geographic composition of worldwide earnings, tax regulations governing each region, net operating loss carry-forwards, availability of tax credits and the effectiveness of Intevac’s tax planning strategies. Management carefully monitors these factors and timely adjusts the effective income tax rate accordingly.

Intevac has benefitted from a tax holiday in Singapore which is scheduled to expire at the end of 2015. The tax holiday provides a lower income tax rate on certain classes of income so long as certain thresholds of business investment and employment levels are met in Singapore. We are presently in discussion with the Singapore tax authority to terminate this tax holiday effective January 1, 2013 due to current conditions in the hard disk drive business, which will not allow Intevac to be able to meet the conditions required to continue benefitting from the tax holiday. We expect the Singapore tax authorities to issue the terms and conditions allowing us to terminate the tax holiday early during the fourth quarter of 2013.

Liquidity and Capital Resources

At September 28, 2013, Intevac had $85.7 million in cash, cash equivalents, and investments compared to $92.2 million at December 31, 2012. During the first nine months of 2013 cash, cash equivalents and investments decreased by $6.5 million due primarily to cash used in operating activities and purchases of fixed assets, partially offset by cash received from the sale of Intevac common stock to Intevac’s employees through Intevac’s employee benefit plans, and cash received from the sale of the assets of DeltaNu.

Cash, cash equivalents and investments consist of the following:

	September 28, 2013		December 31, 2012
	(In thousands)
Cash and cash equivalents	$	16,626	$	24,261
Short-term investments		48,433		40,591
Long-term investments		20,661		27,317
Total cash, cash equivalents and investments	$	85,720	$	92,169

Operating activities used cash of $8.3 million during the first nine months of 2013 and of $14.5 million during the first nine months of 2012. The decrease in cash used in operating activities was due primarily to changes in working capital during the first nine months of 2013, which was mostly offset by a larger net loss.

30

Accounts receivable totaled $16.1 million at September 28, 2013, compared to $19.8 million at December 31, 2012. The decrease of $3.7 million in the receivable balance was due primarily to lower revenue levels and the collection of outstanding receivables from the U.S. government. Total net inventories decreased slightly to $25.8 million at September 28, 2013, compared to $26.2 million at December 31, 2012 as the Company transferred a solar implant ENERGi system in finished goods inventory to property, plant and equipment, offset in part by inventory procured for the production of two 200 Lean systems in backlog. Accounts payable increased slightly to $4.7 million at September 28, 2013 compared to $4.5 million at December 31, 2012. Customer deposits increased to $5.9 million at September 28, 2013 compared to $2.2 million at December 31, 2012. The increase of $3.7 million in the customer deposit balance was due primarily to deposits on orders for two 200 Lean systems.

Investing activities in the first nine months of 2013 used cash of $1.1 million. Purchase of investments net of proceeds from sales and maturities totaled $870,000. On March 29, 2013, the Company sold certain assets which comprised its Raman spectroscopy instruments product line, also known as DeltaNu, and received $500,000 in cash upon closing. See Note 8 “Divestitures” in the notes to the condensed consolidated financial statements for additional information related the sale of the assets of DeltaNu. Capital expenditures for the nine months ended September 28, 2013 were $928,000.

Financing activities in the first nine months of 2013 generated cash of $1.9 million from the sale of Intevac common stock to Intevac’s employees through Intevac’s employee benefit plans.

Intevac’s investment portfolio consists principally of investment grade money market mutual funds, U.S. Treasury and agency securities, commercial paper, municipal bonds, corporate bonds and VRDNs. Intevac regularly monitors the credit risk in its investment portfolio and takes measures, which may include the sale of certain securities, to manage such risks in accordance with its investment policies.

As of September 28, 2013, approximately $6.6 million of cash and cash equivalents and $3.6 million of investments were domiciled in foreign tax jurisdictions. Intevac expects a significant portion of these funds to remain off shore in the short term. If the Company chose to repatriate these funds to the United States, it would be required to accrue and pay additional taxes on any portion of the repatriation where no United States income tax had been previously provided.

Intevac believes that its existing cash, cash equivalents and investments will be sufficient to meet its cash requirements for the foreseeable future. Intevac intends to undertake approximately $1.5 million to $2.0 million in capital expenditures during the remainder of 2013.

Critical Accounting Policies and Estimates

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) requires management to make judgments, assumptions and estimates that affect the amounts reported. Intevac’s significant accounting policies are described in Note 1 to the consolidated financial statements included in Item 8 of Intevac’s Annual Report on Form 10-K filed on February 22, 2013. Certain of these significant accounting policies are considered to be critical accounting policies, as defined below.

A critical accounting policy is defined as one that is both material to the presentation of Intevac’s financial statements and requires management to make difficult, subjective or complex judgments that could have a material effect on Intevac’s financial conditions and results of operations. Specifically, critical accounting estimates have the following attributes: 1) Intevac is required to make assumptions about matters that are highly uncertain at the time of the estimate; and 2) different estimates Intevac could reasonably have used, or changes in the estimate that are reasonably likely to occur, would have a material effect on Intevac’s financial condition or results of operations.

Estimates and assumptions about future events and their effects cannot be determined with certainty. Intevac bases its estimates on historical experience and on various other assumptions believed to be applicable and reasonable under the circumstances. These estimates may change as new events occur, as additional information is

31

obtained and as Intevac’s operating environment changes. These changes have historically been minor and have been included in the consolidated financial statements as soon as they become known. In addition, management is periodically faced with uncertainties, the outcomes of which are not within its control and will not be known for prolonged periods of time. Many of these uncertainties are discussed in the section below entitled “Risk Factors.” Based on a critical assessment of Intevac’s accounting policies and the underlying judgments and uncertainties affecting the application of those policies, management believes that Intevac’s consolidated financial statements are fairly stated in accordance with US GAAP, and provide a meaningful presentation of Intevac’s financial condition and results of operation.

For further information about Intevac’s other critical accounting policies, see the discussion of critical accounting policies in Intevac’s 2012 Form 10-K. Management believes that there has been no significant change during the nine months ended September 28, 2013 to the items identified as critical accounting policies in Intevac’s 2012 Form 10-K.

Item 3.     Quantitative and Qualitative Disclosures About Market Risk

Interest rate risk. Intevac’s exposure to market risk for changes in interest rates relates primarily to its investment portfolio. Intevac does not use derivative financial instruments in Intevac’s investment portfolio. The Company has adopted an investment policy and established guidelines relating to credit quality, diversification and maturities of its investments in order to preserve principal and maintain liquidity. All investment securities in Intevac’s portfolio have an investment grade credit rating. Investments typically consist of commercial paper, obligations of the U.S. government and its agencies, corporate debt securities, municipal bonds and VRDNs.

The table below presents principal amounts and related weighted-average interest rates by year of expected maturity for Intevac’s investment portfolio at September 28, 2013.

	2013			2014			2015			Total		Fair Value
	(In thousands, except percentages)
Cash equivalents
Variable rate amounts	$	10,468			—			—		$	10,468	$	10,468
Weighted-average rate		0.03	%		—			—
Short-term investments
Fixed rate amounts	$	9,950		$	34,277			—		$	44,227	$	44,258
Weighted-average rate		0.32	%		2.22	%		—
Variable rate amounts	$	4,172			—			—		$	4,172	$	4,175
Weighted-average rate		1.18	%		—			—
Long-term investments
Fixed rate amounts		—		$	10,726		$	9,923		$	20,649	$	20,661
Weighted-average rate		—			1.45	%		2.88	%
Total investment portfolio	$	24,590		$	45,003		$	9,923		$	79,516	$	79,562

Foreign exchange risk. From time to time, Intevac enters into foreign currency forward exchange contracts to hedge certain of its anticipated foreign currency re-measurement exposures. The objective of these contracts is to minimize the impact of foreign currency exchange rate movements on Intevac’s operating results. The notional amount of Company’s foreign currency derivatives was $1.7 million at September 28, 2013.

Item 4.     Controls and Procedures

    Evaluation of disclosure controls and procedures

Intevac maintains a set of disclosure controls and procedures that are designed to ensure that information relating to Intevac, Inc. required to be disclosed in periodic filings under the Securities Exchange Act of 1934, or

32

Exchange Act, is recorded, processed, summarized and reported in a timely manner under the Exchange Act. In connection with the filing of this Form 10-Q for the quarter ended September 28, 2013, as required under Rule 13a-15(b) of the Exchange Act, an evaluation was carried out under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of Intevac’s disclosure controls and procedures as of the end of the period covered by this quarterly report. Based on this evaluation, Intevac’s Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 28, 2013.

Attached as exhibits to this Quarterly Report are certifications of the CEO and the CFO, which are required in accordance with Rule 13a-14 of the Exchange Act. This Controls and Procedures section includes the information concerning the controls evaluation referred to in the certifications, and it should be read in conjunction with the certifications for a more complete understanding of the topics presented.

Definition of disclosure controls

Disclosure Controls are controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act, such as this Quarterly Report, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure Controls are also designed to ensure that such information is accumulated and communicated to our management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure. Our Disclosure Controls include components of our internal control over financial reporting, which consists of control processes designed to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles in the U.S. To the extent that components of our internal control over financial reporting are included within our Disclosure Controls, they are included in the scope of our quarterly controls evaluation.

Limitations on the effectiveness of controls

Intevac’s management, including the CEO and CFO, does not expect that Intevac’s Disclosure Controls or Intevac’s internal control over financial reporting will prevent all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within Intevac have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Changes in internal controls over financial reporting

There were no changes in our internal controls over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, Intevac’s internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1.     Legal Proceedings

From time to time, Intevac is involved in claims and legal proceedings that arise in the ordinary course of business. Intevac expects that the number and significance of these matters will increase as Intevac’s business expands. Any claims or proceedings against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time, result in the diversion of significant operational resources, or require us to enter into royalty or licensing agreements which, if required, may not be available on terms favorable to us or at all. Intevac is not presently a party to any lawsuit or proceeding that, in Intevac’s opinion, is likely to seriously harm Intevac’s business.

Item 1A.     Risk Factors

The following factors could materially affect Intevac’s business, financial condition or results of operations and should be carefully considered in evaluating the Company and its business, in addition to other information presented elsewhere in this report.

The industries we serve are cyclical, volatile and unpredictable.

The majority of our revenue is derived from the sale of equipment used to manufacture commodity technology products such as disk drives and PV solar cells. This subjects us to business cycles, the timing, length and volatility of which can be difficult to predict. When demand for commodity technology products exceeds production capacity, then demand for new capital equipment such as ours tends to be amplified. Conversely, when supply of commodity technology products exceeds demand, then demand for new capital equipment such as ours tends to be depressed. For example, sales of systems for magnetic disk production were depressed from late 2007 through 2009. The number of new systems delivered increased in 2010 as customers increased their production capacity in response to increased demand for digital storage, but decreased in 2011, 2012 and 2013, as the hard disk drive industry did not add the same level of capacity that it did in 2010. We cannot predict with any certainty when these cycles will begin or end. For example, while we previously believed that our sales would continue to be depressed through 2013, we now believe that the cycle will continue into at least 2014.

Our equipment represents only a portion of the capital expenditure that our customers incur when they upgrade or add production capacity. Accordingly, our customers generally commit to making large capital expenditures far in excess of the cost of our systems alone when they decide to purchase our systems. The magnitude of these capital expenditures requires our customers to have access to large amounts of capital. Our customers generally reduce their level of capital investment during downturns in the overall economy or during a downturn in their industries.

We must effectively manage our resources and production capacity to meet rapidly changing demand. Our business experiences rapid growth and contraction, which stresses our infrastructure, internal systems and managerial resources. During periods of increasing demand for our products, we must have sufficient manufacturing capacity and inventory to meet customer demand; attract, retain and motivate a sufficient number of qualified individuals; and effectively manage our supply chain. During periods of decreasing demand for our products, we must be able to align our cost structure with prevailing market conditions; motivate and retain key employees and effectively manage our supply chain.

Sales of our equipment are primarily dependent on our customers’ upgrade and capacity expansion plans and whether our customers select our equipment.

We have no control over our customers’ upgrade and capacity expansion plans, and we cannot be sure they will select, or continue to select, our equipment when they upgrade or expand their capacity. The sales cycle for our equipment systems can be a year or longer, involving individuals from many different areas of Intevac and numerous product presentations and demonstrations for our prospective customers. Our sales process also commonly includes production of samples, customization of our products, and installation of evaluation systems in the factories of our prospective customers. We do not enter into long-term contracts with our customers, and until an order is actually submitted by a customer there is no binding commitment to purchase our systems.

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Intevac Photonics’ business is also subject to long sales cycles because many of its products, such as our military imaging products, often must be designed into the customers’ end products, which are often complex state-of-the-art products. These development cycles are typically multi-year, and our sales are contingent on our customers successfully integrating our product into their product, completing development of their product and then obtaining production orders for their product from the U.S. government or its allies.

Sales of new manufacturing systems are also dependent on obsolescence and replacement of the installed base of our customers’ existing equipment with newer, more capable equipment. If upgrades are developed that extend the useful life of the installed base of systems, then we tend to sell more upgrade products and fewer new systems, which can significantly reduce total revenue. For example, some of our 200 Lean customers continue to use legacy systems for the production of perpendicular media, which delayed the replacement of such systems with new 200 Lean systems.

Our 200 Lean customers also experience competition from companies that produce alternative storage technologies like flash memory, which offer smaller size, lower power consumption and more rugged designs. These storage technologies are being used increasingly in enterprise applications and smaller form factors such as tablets, smart-phones, ultra-books and notebook personal computers instead of hard disk drives. Tablet computing devices and smart-phones have never contained, nor are they likely in the future to contain, a disk drive. Products using alternative technologies, such as flash memory, optical storage and other storage technologies are becoming increasingly common and could become a significant source of competition to particular applications of the products of our 200 Lean customers, which could adversely affect our results of operations. If alternative technologies, such as flash memory, replace hard disk drives as a significant method of digital storage, then demand for our hard disk manufacturing products would decrease.

We operate in an intensely competitive marketplace, and our competitors have greater resources than we do.

In the market for our disk sputtering systems, we experience competition primarily from Canon Anelva, which has sold a substantial number of systems worldwide. In the PV equipment market, Intevac faces competition from large established competitors including Applied Materials, Centrotherm Photovoltaics, Amtech, Jusung and Von Ardenne. In the market for our military imaging products we experience competition from companies such as ITT Exelis and L-3 Communications. Some of our competitors have substantially greater financial, technical, marketing, manufacturing and other resources than we do, especially in the PV equipment market. Our competitors may develop enhancements to, or future generations of, competitive products that offer superior price or performance features, and new competitors may enter our markets and develop such enhanced products. Moreover, competition for our customers is intense, and our competitors have historically offered substantial pricing concessions and incentives to attract our customers or retain their existing customers.

We are exposed to risks associated with a highly concentrated customer base.

Historically, a significant portion of our revenue in any particular period has been attributable to sales of our disk sputtering systems to a limited number of customers. This concentration of customers, when combined with changes in the customers’ specific capacity plans and market share shifts can lead to extreme variability in our revenue and financial results from period to period.

The concentration of our customer base may enable our customers to demand pricing and other terms unfavorable to Intevac, and makes us more vulnerable to changes in demand by a given customer. Orders from a relatively limited number of manufacturers have accounted for, and will likely continue to account for, a substantial portion of our revenues. The loss of one of these large customers, or delays in purchasing by them, could have a material and adverse effect on our revenues.

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Our growth depends on development of technically advanced new products and processes.

We have invested heavily, and continue to invest, in the development of new and existing products, such as our 200 Lean system, our LEAN SOLAR systems for PV applications, our digital night-vision products and our near-eye display products. Our success in developing and selling new products depends upon a variety of factors, including our ability to: predict future customer requirements, make technological advances, achieve a low total cost of ownership for our products, introduce new products on schedule, manufacture products cost-effectively including transitioning production to volume manufacturing; commercialize and attain customer acceptance of our products; and achieve acceptable and reliable performance of our new products in the field. Our new product decisions and development commitments must anticipate continuously evolving industry requirements significantly in advance of sales. In addition, we are attempting to expand into new or related markets, including the PV market. Our expansion into the PV market is dependent upon the success of our customers’ development plans. To date we have not recognized material revenue from such products. Failure to correctly assess the size of the markets, to successfully develop cost effective products to address the markets or to establish effective sales and support of the new products would have a material adverse effect on future revenues and profits.

Rapid technological change in our served markets requires us to rapidly develop new technically advanced products. Our future success depends in part on our ability to develop and offer new products with improved capabilities and to continue to enhance our existing products. If new products have reliability or quality problems, our performance may be impacted by reduced orders, higher manufacturing costs, delays in acceptance and payment for new products and additional service and warranty expenses.

Our operating results fluctuate significantly from quarter to quarter, which can lead to volatility in the price of our common stock.

Our quarterly revenues and common stock price have fluctuated significantly. We anticipate that our revenues, operating margins and common stock price will continue to fluctuate for a variety of reasons, including: (1) changes in the demand, due to seasonality, cyclicality and other factors in the markets for computer systems, storage subsystems and consumer electronics containing disks our customers produce with our systems; (2) delays or problems in the introduction and acceptance of our new products, or delivery of existing products; (3) timing of orders, acceptance of new systems by our customers or cancellation of those orders; (4) new products, services or technological innovations by our competitors or us; (5) changes in our manufacturing costs and operating expense; (6) changes in general economic, political, stock market and industry conditions; and (7) any failure of our operating results to meet the expectations of investment research analysts or investors.

Any of these, or other factors, could lead to volatility and/or a rapid change in the trading price of our common shares. In the past, securities class action litigation has been instituted against companies following periods of volatility in the market price of their securities. Any such litigation, if instituted against Intevac, could result in substantial costs and diversion of management time and attention.

Adverse economic conditions and volatility and disruption of the capital and credit markets may negatively impact our revenues and our ability to access financing.

Economic conditions worldwide have contributed to decreased spending by our customers and a slowdown in the hard disk drive industry. These factors have adversely impacted our operating results and have caused us to be cautious about our future outlook. Our customers also continue to remain cautious about the economy. Negative macroeconomic and global recessionary factors, further volatility or disruption in the capital and credit markets or further uncertainty or weakening in key markets could negatively impact spending for our products and may materially adversely affect our business, operating results and financial condition.

In addition, while we intend to finance operations with existing cash and cash flow from operations, if necessary, we may require financing to support our continued operations. Due to the existing uncertainty in the capital and credit markets, our access to capital may not be available on terms acceptable to us or at all.

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We may not be able to obtain export licenses from the U.S. government permitting delivery of our products to international customers.

Many of our products, especially Intevac Photonics’ products, require export licenses from U.S. government agencies under the Export Administration Act, the Trading with the Enemy Act of 1917, the Arms Export Act of 1976 or the International Traffic in Arms Regulations. These regulations limit the potential market for some of our products. We can give no assurance that we will be successful in obtaining all the licenses necessary to export our products. Heightened government scrutiny of export licenses for defense related products has resulted in lengthened review periods for our license applications. Exports to countries that are not considered by the U.S. government to be allies are likely to be prohibited, and even sales to U.S. allies may be limited. Failure to comply with export control laws, including identification and reporting of all exports and re-exports of controlled technology or exports made without correct license approval or improper license use could result in severe penalties and revocation of licenses. Failure to obtain export licenses, delays in obtaining licenses, or revocation of previously issued licenses would prevent us from selling the affected products outside the United States and could negatively impact our results of operations.

The Intevac Photonics business is dependent on U.S. government contracts, which are subject to fixed pricing, immediate termination and a number of procurement rules and regulations.

We sell our Photonics products and services directly to the U.S. government, as well as to prime contractors for various U.S. government programs. The U.S government is considering significant changes in the level of existing, follow-on or replacement programs. We cannot predict the impact of potential changes in priorities due to military transformations and/or the nature of future war-related activities. A shift of government priorities to programs in which we do not participate and/or reductions in funding for or the termination of programs in which we do participate, unless offset by other programs and opportunities, could have a material adverse effect on our financial position, results of operations, or cash flows.

Funding of multi-year government programs is subject to congressional appropriations, and there is no guarantee that the U.S. government will make further appropriations, particularly given the U.S. government’s recent focus on spending in other areas and spending reductions. Sales to the U.S. government and its prime contractors may also be affected by changes in procurement policies, budget considerations and political developments in the United States or abroad. For example, if the U.S. government is less focused on defense spending or there is a decrease in hostilities, demand for our products could decrease. The loss of funding for a government program would result in a loss of future revenues attributable to that program. The influence of any of these factors, which are beyond our control, could negatively impact our results of operations.

A significant portion of our U.S. government revenue is derived from fixed-price development and production contracts. Under fixed-price contracts, unexpected increases in the cost to develop or manufacture a product, whether due to inaccurate estimates in the bidding process, unanticipated increases in material costs, reduced production volumes, inefficiencies or other factors, are borne by us. We have experienced cost overruns in the past that have resulted in losses on certain contracts, and may experience additional cost overruns in the future. We are required to recognize the total estimated impact of cost overruns in the period in which they are first identified. Such cost overruns could have a material adverse effect on our results of operations.

Generally, government contracts contain provisions permitting termination, in whole or in part, without prior notice at the government’s convenience upon the payment of compensation only for work done and commitments made at the time of termination. We cannot ensure that one or more of the government contracts under which we, or our customers, operate will not be terminated under these circumstances. Also, we cannot ensure that we, or our customers, would be able to procure new government contracts to offset the revenues lost as a result of any termination of existing contracts, nor can we ensure that we, or our customers, will continue to remain in good standing as federal contractors.

As a U.S. government contractor we must comply with specific government rules and regulations and are subject to routine audits and investigations by U.S. government agencies. If we fail to comply with these rules and regulations, the results could include: (1) reductions in the value of our contracts; (2) reductions in amounts previously billed and recognized as revenue; (3) contract modifications or termination; (4) the assessment of penalties and fines; and (5) suspension or debarment from government contracting or subcontracting for a period of time or permanently.

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Changes to our effective tax rate affect our results of operations.

As a global company, we are subject to taxation in the United States, Singapore and various other countries. Significant judgment is required to determine and estimate worldwide tax liabilities. Our future effective tax rate could be affected by: (1) changes in tax laws; (2) the allocation of earnings to countries with differing tax rates; (3) changes in worldwide projected annual earnings in current and future years: (4) accounting pronouncements; or (5) changes in the valuation of our deferred tax assets and liabilities. Although we believe our tax estimates are reasonable, there can be no assurance that any final determination will not be different from the treatment reflected in our historical income tax provisions and accruals, which could result in additional payments by Intevac.

Intevac has benefitted from a tax holiday in Singapore which is scheduled to expire at the end of 2015. The tax holiday provides a lower income tax rate on certain classes of income so long as certain thresholds of business investment and employment levels are met in Singapore. We are presently in discussion with the Singapore tax authority to terminate this tax holiday effective January 1, 2013 due to current conditions in the hard disk drive business, which will not allow Intevac to be able to meet the conditions required to continue benefitting from the tax holiday. We expect the Singapore tax authorities to issue the terms and conditions allowing us to terminate the tax holiday early during the fourth quarter of 2013. The terms and conditions could include a claw back by the Singapore government of tax benefits received in previous years. A claw back of all or part of these tax benefits would adversely affect our results of operations and cash flows.

We booked significant tax benefits in 2008, 2009, and 2011 based on our belief that we could both carry back losses and tax credits to years Intevac paid income taxes and carry forward losses and tax credits to future years where we believed we would generate taxable income. In 2012, the Company established a $23.4 million non-cash valuation allowance against certain of its U.S. deferred tax assets based upon an evaluation of all available objectively verifiable evidence, including but not limited to the cumulative loss incurred over the three-year period ended December 31, 2012 by the Company’s U.S. operations. The establishment of the non-cash valuation allowance on the Company’s U.S. deferred tax assets did not have any impact on its cash, nor does such an allowance preclude the Company from utilizing its tax losses, tax credits or other deferred tax assets in future periods.

Intevac will need to generate approximately $49.5 million of taxable income in Singapore in order to fully realize the foreign deferred tax assets recorded as of September 28, 2013. If our expectations of future income are incorrect, we could be required to establish additional valuation allowance against some or the entire remaining deferred tax assets which are primarily attributable to our Singapore operation.

Our success depends on international sales and the management of global operations.

The majority of our revenues come from regions outside the United States. Most of our international sales are to customers in Asia, which includes products shipped to overseas operations of U.S. companies. We currently have manufacturing facilities in California and Singapore and international customer support offices in Singapore, China, and Malaysia. We expect that international sales will continue to account for a significant portion of our total revenue in future years. Certain of our suppliers are also located outside the United States.

Managing our global operations presents challenges including, but not limited to, those arising from: (1) global trade issues; (2) variations in protection of intellectual property and other legal rights in different countries; (3) concerns of U.S. governmental agencies regarding possible national commercial and/or security issues posed by growing manufacturing business in Asia; (4) fluctuation of interest rates, raw material costs, labor and operating costs, and exchange rates, including the weakening relative position of the U.S. dollar; (5) variations in the ability to develop relationships with suppliers and other local businesses; (6) changes in the laws and regulations of the United States, including export restrictions, and other countries, as well as their interpretation and application; (7) the need to provide technical and spares support in different locations; (8) political and economic instability; (9) cultural differences; (10) varying government incentives to promote development; (11) shipping costs and delays; (12) adverse conditions in credit markets; (13) variations in tariffs, quotas, tax codes and other market barriers; and (14) barriers to movement of cash.

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We must regularly assess the size, capability and location of our global infrastructure and make appropriate changes to address these issues.

We may be subject to additional impairment charges due to potential declines in the fair value of our assets.

As a result of our acquisitions, we have significant intangible assets and had significant goodwill on our balance sheet. We test these assets for impairment on a periodic basis as required, and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The events or changes that could require us to test our intangible assets for impairment include: a significant reduction in our stock price, and as a result market capitalization, changes in our estimated future cash flows, as well as changes in rates of growth in our industry or in any of our reporting units. In the fourth quarter of 2012, as a result of a decline in our market capitalization and a reduction in our revenue expectations we recorded a goodwill impairment charge in the amount of $18.4 million. We will continue to evaluate the carrying value of our intangible assets and if we determine in the future that there is a potential further impairment, we may be required to record additional charges to earnings which could materially adversely affect our financial results and could also materially adversely affect our business. See Note 6 “Purchased Intangible Assets” in the notes to the condensed consolidated financial statements for additional information related to impairment of intangible assets.

Our success is dependent on recruiting and retaining a highly talented work force.

Our employees are vital to our success, and our key management, engineering and other employees are difficult to replace. We generally do not have employment contracts with our key employees. Further, we do not maintain key person life insurance on any of our employees. The expansion of high technology companies worldwide has increased demand and competition for qualified personnel, and has made companies increasingly protective of prior employees. It may be difficult for us to locate employees who are not subject to non-competition agreements and other restrictions.

The majority of our U.S. operations are located in California where the cost of living and of recruiting employees is high. Our operating results depend, in large part, upon our ability to retain and attract qualified management, engineering, marketing, manufacturing, customer support, sales and administrative personnel. Furthermore, we compete with industries such as the hard disk drive, semiconductor, and solar industries for skilled employees. Failure to retain existing key personnel, or to attract, assimilate or retain additional highly qualified employees to meet our needs in the future, could have a material and adverse effect on our business, financial condition and results of operations.

We are dependent on certain suppliers for parts used in our products.

We are a manufacturing business. Purchased parts constitute the largest component of our product cost. Our ability to manufacture depends on the timely delivery of parts, components and subassemblies from suppliers. We obtain some of the key components and subassemblies used in our products from a single supplier or a limited group of suppliers. If any of our suppliers fail to deliver quality parts on a timely basis, we may experience delays in manufacturing, which could result in delayed product deliveries, increased costs to expedite deliveries or develop alternative suppliers, or require redesign of our products to accommodate alternative suppliers. Some of our suppliers are thinly capitalized and may be vulnerable to failure given recent economic conditions.

Our business depends on the integrity of our intellectual property rights.

The success of our business depends upon the integrity of our intellectual property rights, and we cannot ensure that: (1) any of our pending or future patent applications will be allowed or that any of the allowed applications will be issued as patents or will issue with claims of the scope we sought; (2) any of our patents will not be invalidated, deemed unenforceable, circumvented or challenged; (3) the rights granted under our patents will provide competitive advantages to us; (4) other parties will not develop similar products, duplicate our products or design around our patents; or (5) our patent rights, intellectual property laws or our agreements will adequately protect our intellectual property or competitive position.

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From time to time, we have received claims that we are infringing third parties’ intellectual property rights or seeking to invalidate our rights. We cannot ensure that third parties will not in the future claim that we have infringed current or future patents, trademarks or other proprietary rights relating to our products. Any claims, with or without merit, could be time-consuming, result in costly litigation, cause product shipment delays or require us to enter into royalty or licensing agreements. Such royalty or licensing agreements, if required, may not be available on terms acceptable to us.

We could be involved in litigation.

From time to time we may be involved in litigation of various types, including litigation alleging infringement of intellectual property rights and other claims. Litigation is expensive, subjects us to the risk of significant damages and requires significant management time and attention and could have a material and adverse effect on our business, financial condition and results of operations.

Difficulties in integrating past or future acquisitions could adversely affect our business.

We have completed a number of acquisitions during our operating history. For example, in 2007, we acquired certain assets of DeltaNu, LLC and certain assets of Creative Display Systems, LLC, in 2008 we acquired certain assets of OC Oerlikon Balzers Ltd., in 2010 we acquired the outstanding shares of SIT, in 2012 we completed the sale of certain semiconductor mainframe technology assets and in 2013 we completed the sale of the assets of DeltaNu. We have spent and may continue to spend significant resources identifying and pursuing future acquisition opportunities. Acquisitions involve numerous risks including: (1) difficulties in integrating the operations, technologies and products of the acquired companies; (2) the diversion of our management’s attention from other business concerns; and (3) the potential loss of key employees of the acquired companies. Failure to achieve the anticipated benefits of the prior and any future acquisitions or to successfully integrate the operations of the companies we acquire could have a material and adverse effect on our business, financial condition and results of operations. Any future acquisitions could also result in potentially dilutive issuance of equity securities, acquisition-or divestiture-related write-offs or the assumption of debt and contingent liabilities. In addition, we have made and will continue to consider making strategic divestitures. With any divestiture, there are risks that future operating results could be unfavorably impacted if targeted objectives, such as cost savings, are not achieved or if other business disruptions occur as a result of the divestiture or activities related to the divestiture.

We are subject to risks of non-compliance with environmental and other governmental regulations.

We are subject to a variety of governmental regulations relating to the use, storage, discharge, handling, emission, generation, manufacture, treatment and disposal of toxic or otherwise hazardous substances, chemicals, materials or waste. If we fail to comply with current or future regulations, such failure could result in suspension of our operations, alteration of our manufacturing process, remediation costs or substantial civil penalties or criminal fines against us or our officers, directors or employees. Additionally, these regulations could require us to acquire expensive remediation or abatement equipment or to incur substantial expenses to comply with them.

We are also subject to a variety of other governmental regulations and may incur significant costs associated with the compliance with these regulations. For example rules adopted by the SEC to implement the Dodd-Frank Wall Street Reform and Consumer Protection Act impose diligence and disclosure requirements regarding the use of “conflict” minerals mined from the Democratic Republic of Congo and adjoining countries in the products we manufacture. Compliance with these regulations is likely to result in additional costs and expenses or may affect the sourcing and availability of the components used in the products we manufacture.

Business interruptions could adversely affect our operations.

Our operations are vulnerable to interruption by fire, earthquake, floods or other natural disaster, quarantines or other disruptions associated with infectious diseases, national catastrophe, terrorist activities, war, disruptions in our computing and communications infrastructure due to power loss, telecommunications failure, human error, physical or electronic security breaches and computer viruses, and other events beyond our control. We do not have a detailed disaster recovery plan. Despite our implementation of network security measures, our tools and servers may

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be vulnerable to computer viruses, break-ins and similar disruptions from unauthorized tampering with our computer systems and tools located at customer sites. Political instability could cause us to incur increased costs in transportation, make such transportation unreliable, increase our insurance costs or cause international currency markets to fluctuate. All these unforeseen disruptions and instabilities could have the same effects on our suppliers and their ability to timely deliver their products. In addition, we do not carry sufficient business interruption insurance to compensate us for all losses that may occur, and any losses or damages incurred by us could have a material adverse effect on our business and results of operations. For example, we self-insure earthquake risks because we believe this is the prudent financial decision based on the high cost of the limited coverage available in the earthquake insurance market. An earthquake could significantly disrupt our operations, most of which are conducted in California. It could also significantly delay our research and engineering effort on new products, most of which is also conducted in California. We take steps to minimize the damage that would be caused by business interruptions, but there is no certainty that our efforts will prove successful.

We are required to evaluate our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002, and any adverse results from such evaluation could result in a loss of investor confidence in our financial reports and have an adverse effect on our stock price.

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, our management must perform evaluations of our internal control over financial reporting. Beginning in 2004, our Form 10-K has included a report by management of their assessment of the adequacy of such internal control. Additionally, our independent registered public accounting firm must publicly attest to the effectiveness of our internal control over financial reporting.

We have completed the evaluation of our internal controls over financial reporting as required by Section 404 of the Sarbanes-Oxley Act. Although our assessment, testing, and evaluation resulted in our conclusion that as of December 31, 2012, our internal controls over financial reporting were effective, we cannot predict the outcome of our testing in future periods. Ongoing compliance with this requirement is complex, costly and time-consuming. If Intevac fails to maintain effective internal control over financial reporting; our management does not timely assess the adequacy of such internal control; or our independent registered public accounting firm does not deliver an unqualified opinion as to the effectiveness of our internal control over financial reporting, then we could be subject to restatement of previously reported financial results, regulatory sanctions and a decline in the public’s perception of Intevac, which could have a material and adverse effect on our business, financial condition and results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

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Item 6. Exhibits

The following exhibits are filed herewith:

Exhibit Number	Description
31.1	Certification of President and Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Executive Vice President, Finance and Administration, Chief Financial Officer, Treasurer and Secretary Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certifications Pursuant to U.S.C. 1350 Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	INTEVAC, INC.
Date: October 29, 2013	By:	/S/ WENDELL BLONIGAN
		Wendell Blonigan
		President, Chief Executive Officer and Director   (Principal Executive Officer)

Date: October 29, 2013	By:	/S/ JEFFREY ANDRESON
		Jeffrey Andreson
		Executive Vice President, Finance and   Administration, Chief Financial Officer,   Treasurer and Secretary   (Principal Financial and Accounting Officer)

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EX-31.1

Exhibit 31.1

I, Wendell Blonigan certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Intevac, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 29, 2013

/s/ WENDELL BLONIGAN

Wendell Blonigan

President, Chief Executive Officer and Director

EX-31.2

Exhibit 31.2

I, Jeffrey Andreson certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Intevac, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 29, 2013

/s/ JEFFREY ANDRESON

Jeffrey Andreson

Executive Vice President, Finance and Administration, Chief Financial Officer, Treasurer and Secretary

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Wendell Blonigan, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Intevac, Inc. on Form 10-Q for the quarterly period ended September 28, 2013 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-Q fairly presents in all material respects the financial condition and results of operations of Intevac, Inc.

Date: October 29, 2013

/s/ WENDELL BLONIGAN

Wendell Blonigan

President, Chief Executive Officer and Director

I, Jeffrey Andreson, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Intevac, Inc. on Form 10-Q for the quarterly period ended September 28, 2013 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-Q fairly presents in all material respects the financial condition and results of operations of Intevac, Inc.

Date: October 29, 2013

/s/ JEFFREY ANDRESON

Jeffrey Andreson

Executive Vice President, Finance and Administration,
Chief Financial Officer, Treasurer and Secretary

A signed original of this written statement required by Section 906 has been provided to Intevac, Inc. and will be retained by Intevac, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

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Cash, Cash Equivalents and Investments

9 Months Ended

Sep. 28, 2013

Cash, Cash Equivalents and Investments

11. Cash, Cash Equivalents and Investments

Cash and cash equivalents, short-term investments and long-term investments consist of:

	September 28, 2013
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Fair Value
	(In thousands)
Cash and cash equivalents:
Cash	$	6,158	$	—	$	—	$	6,158
Money market funds		10,468		—		—		10,468
Total cash and cash equivalents	$	16,626	$	—	$	—	$	16,626
Short-term investments:
Commercial paper	$	997	$	—	$	—	$	997
Corporate bonds and medium-term notes		21,930		23		3		21,950
Municipal bonds		6,113		2		1		6,114
U.S. treasury and agency securities		19,199		13		—		19,212
Variable rate demand notes (“VRDNs”)		160		—		—		160
Total short-term investments	$	48,399	$	38	$	4	$	48,433
Long-term investments:
Corporate bonds and medium-term notes	$	15,576	$	9	$	3	$	15,582
Municipal bonds		1,065		2		—		1,067
U.S. treasury and agency securities		4,008		4		—		4,012
Total long-term investments	$	20,649	$	15	$	3	$	20,661
Total cash, cash equivalents, and investments	$	85,674	$	53	$	7	$	85,720

	December 31. 2012
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Fair Value
	(In thousands)
Cash and cash equivalents:
Cash	$	5,939	$	—	$	—	$	5,939
Money market funds		18,322		—		—		18,322
Total cash and cash equivalents	$	24,261	$	—	$	—	$	24,261
Short-term investments:
Commercial paper	$	2,495	$	—	$	—	$	2,495
Corporate bonds and medium-term notes		19,539		13		4		19,548
Municipal bonds		1,203		1		—		1,204
U.S. treasury and agency securities		16,976		23		—		16,999
VRDNs		345		—		—		345
Total short-term investments	$	40,558	$	37	$	4	$	40,591
Long-term investments:
Corporate bonds and medium-term notes	$	16,776	$	33	$	7	$	16,802
Municipal bonds		1,000		2		—		1,002
U.S. treasury and agency securities		9,499		14		—		9,513
Total long-term investments	$	27,275	$	49	$	7	$	27,317
Total cash, cash equivalents, and investments	$	92,094	$	86	$	11	$	92,169

The contractual maturities of available-for-sale securities at September 28, 2013 are presented in the following table.

	Amortized Cost		Fair Value
	(In thousands)
Due in one year or less	$	55,702	$	55,734
Due after one through two years		22,654		22,668
Due after ten years		1,160		1,160
	$	79,516	$	79,562

The following table provides the fair market value of Intevac’s investments with unrealized losses that are not deemed to be other-than temporarily impaired as of September 28, 2013.

	September 28, 2013
	In Loss Position for Less than 12 Months				In Loss Position for Greater than 12 Months
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(In thousands)
Corporate bonds and medium-term notes	$	7,802	$	6	$	—	$	—
Municipal bonds		3,112		1		—		—
	$	10,914	$	7	$	—	$	—

All prices for the fixed maturity securities including U.S. Treasury and agency securities, commercial paper, corporate bonds, VRDNs and municipal bonds are received from independent pricing services utilized by Intevac’s outside investment manager. This investment manager performs a review of the pricing methodologies and inputs utilized by the independent pricing services for each asset type priced by the vendor. In addition, on at least an annual basis, the investment manager conducts due diligence visits and interviews with each pricing vendor to verify the inputs utilized for each asset class. The due diligence visits include a review of the procedures performed by each vendor to ensure that pricing evaluations are representative of the price that would be received to sell a security in an orderly transaction. Any pricing where the input is based solely on a broker price is deemed to be a Level 3 price. Intevac uses the pricing data obtained from its outside investment manager as the primary input to make its assessments and determinations as to the ultimate valuation of the above-mentioned securities and has not made, during the periods presented, any material adjustments to such inputs.

The following table represents the fair value hierarchy of Intevac’s available-for-sale securities measured at fair value on a recurring basis as of September 28, 2013.

	Fair Value Measurements at September 28, 2013
	Total		Level 1		Level 2
	(In thousands)
Recurring fair value measurements:
Available-for-sale securities
Money market funds	$	10,468	$	10,468	$	—
U.S. treasury and agency securities		23,224		8,703		14,521
Commercial paper		997		—		997
Corporate bonds and medium-term notes		37,532		—		37,532
Municipal bonds		7,181		—		7,181
VRDNs		160		—		160
Total recurring fair value measurements	$	79,562	$	19,171	$	60,391

The following table presents the changes in Level 3 instruments which consisted of Auction Rate Securities (“ARS”) which were classified as available-for-sale securities and which were measured on a recurring basis for the nine month period ended September 29, 2012.

(In thousands)
Opening balance	$	4,490
Total gains (losses) for the period
Included in earnings		(229	)
Included in other comprehensive income		171
Proceeds from tender offers		(2,771	)
Closing balance	$	1,661

The Company did not hold any ARS as of or during the nine months ended September 28, 2013.

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Divestitures - Additional Information (Detail) (DeltaNu, USD $)	3 Months Ended
	Mar. 30, 2013
Divestitures [Line Items]
Proceeds from sale of assets	$ 500,000
Percentage of Earn-out receivable	5.00%
Earn-out period	5 years
Maximum earn-out payments during payment period	1,000,000
Maximum
Divestitures [Line Items]
Maximum consideration receivable from assets sold	1,500,000
Minimum
Divestitures [Line Items]
Annual minimum earn-out payment receivable	$ 100,000

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Condensed Consolidated Statements Of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013	Sep. 29, 2012
Net revenues:
Systems and components	$ 15,991	$ 11,665	$ 38,111	$ 55,067
Technology development	3,124	5,169	10,970	10,874
Total net revenues	19,115	16,834	49,081	65,941
Cost of net revenues:
Systems and components	9,725	7,476	26,206	31,561
Technology development	2,495	3,626	8,638	7,569
Total cost of net revenues	12,220	11,102	34,844	39,130
Gross profit	6,895	5,732	14,237	26,811
Operating expenses:
Research and development	4,250	7,336	16,192	24,812
Selling, general and administrative	5,627	6,389	16,834	19,831
Bad debt expense		3,017		3,017
Total operating expenses	9,877	16,742	33,026	47,660
Gain (loss) on divestitures			(208)	2,207
Loss from operations	(2,982)	(11,010)	(18,997)	(18,642)
Interest income and other, net	220	(8)	392	411
Loss before income taxes	(2,762)	(11,018)	(18,605)	(18,231)
Benefit from income taxes	(17)	(3,011)	(1,184)	(5,570)
Net loss	$ (2,745)	$ (8,007)	$ (17,421)	$ (12,661)
Net loss per share:
Basic and diluted	$ (0.11)	$ (0.34)	$ (0.73)	$ (0.54)
Weighted average common shares outstanding:
Basic and diluted	23,931	23,397	23,793	23,293

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Equity-Based Compensation

9 Months Ended

Sep. 28, 2013

Equity-Based Compensation

4. Equity-Based Compensation

At September 28, 2013, Intevac had equity-based awards outstanding under the 2012 Equity Incentive Plan, the 2004 Equity Incentive Plan (the “Plans”) and the 2003 Employee Stock Purchase Plan (the “ESPP”). Intevac’s stockholders approved all of these plans. The Plans permit the grant of incentive or non-statutory stock options, restricted stock, stock appreciation rights, restricted stock units (“RSUs” also referred to as performance units) and performance shares.

The ESPP provides that eligible employees may purchase Intevac’s common stock through payroll deductions at a price equal to 85% of the lower of the fair market value at the beginning of the applicable offering period or at the end of each applicable purchase interval. Offering periods are generally two years in length, and consist of a series of six-month purchase intervals. Eligible employees may join the ESPP at the beginning of any six-month purchase interval. Under the terms of the ESPP, employees can choose to have up to 15% of their base earnings withheld to purchase Intevac common stock.

Compensation Expense

The effect of recording equity-based compensation for the three and nine months ended September 28, 2013 and September 29, 2012 was as follows:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(In thousands)
Equity-based compensation by type of award:
Stock options	$	375		$	523		$	651		$	1,843
RSUs		130			88			314			111
Employee stock purchase plan		249			332			871			987
Total equity-based compensation		754			943			1,836			2,941
Tax effect on equity-based compensation		(8	)		(205	)		(18	)		(706	)
Net effect on net loss	$	746		$	738		$	1,818		$	2,235

Equity-based compensation expense is based on awards ultimately expected to vest and such amount has been reduced for estimated forfeitures. Forfeitures were estimated based on Intevac’s historical experience, which Intevac believes to be indicative of Intevac’s future experience.

Stock Options and ESPP

The fair value of stock options and ESPP awards is estimated at the grant date using the Black-Scholes option valuation model. The determination of fair value of stock options and ESPP awards on the date of grant using an option-pricing model is affected by Intevac’s stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, our expected stock price volatility over the term of the awards and actual employee stock option exercise behavior.

Option activity as of September 28, 2013 and changes during the nine months ended September 28, 2013 were as follows:

	Shares			Weighted Average Exercise Price
Options outstanding at December 31, 2012		3,128,408		$	11.52
Options granted		902,770		$	5.59
Options cancelled and forfeited		(1,339,934	)	$	13.73
Options exercised		(69,838	)	$	3.91
Options outstanding at September 28, 2013		2,621,406		$	8.55
Vested and expected to vest at September 28, 2013		2,386,932		$	8.77
Options exercisable at September 28, 2013		1,412,001		$	10.34

Intevac issued 457,000 shares under the ESPP during the nine months ended September 28, 2013.

Intevac estimated the weighted-average fair value of stock options and employee stock purchase rights using the following weighted-average assumptions:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
Stock Options:
Weighed-average fair value of grants per share	$	2.81		$	2.87		$	2.48		$	3.90
Expected volatility		55.06	%		63.19	%		56.40	%		63.80	%
Risk free interest rate		1.04	%		0.41	%		1.09	%		0.74	%
Expected term of options (in years)		4.02			3.94			4.22			4.63
Dividend yield		None			None			None			None

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
Stock Purchase Rights:
Weighed-average fair value of grants per share	$	1.97		$	2.31		$	1.63		$	3.01
Expected volatility		43.09	%		63.23	%		51.54	%		62.36	%
Risk free interest rate		0.21	%		0.21	%		0.26	%		0.28	%
Expected term of purchase rights (in years)		1.00			1.85			1.77			1.68
Dividend yield		None			None			None			None

The computation of the expected volatility assumptions used in the Black-Scholes calculations for new grants and purchase rights is based on the historical volatility of Intevac’s stock price, measured over a period equal to the expected term of the grant or purchase right. The risk-free interest rate is based on the yield available on U.S. Treasury Strips with an equivalent remaining term. The expected term of employee stock options represents the weighted-average period that the stock options are expected to remain outstanding and was determined based on historical experience of similar awards, giving consideration to the contractual terms of the equity-based awards and vesting schedules. The expected term of purchase rights represents the period of time remaining in the current offering period.

The dividend yield assumption is based on Intevac’s history of not paying dividends and the assumption of not paying dividends in the future.

Stock Option Exchange Program

During our Annual Stockholder’s Meeting held on May 9, 2013, our stockholders approved a one-time Employee Stock Option Exchange Program (the “Exchange Program”) pursuant to which eligible employees were provided an opportunity to exchange, on a grant-by-grant basis, eligible outstanding stock options for a lesser number of new options, to be granted under our 2012 Equity Incentive Plan. Options eligible for the Exchange Program are those that were granted prior to the 12-month period preceding the start of the Exchange Program offering period, and have exercise prices per share that are greater than $8.49, 50% above our closing per share stock price measured as of July 5, 2013 which is shortly before the start of the Exchange Program. The Exchange Program offering period commenced on July 6, 2013 and closed on August 6, 2013, at which time a total of 87 eligible option holders exchanged 766,000 outstanding stock options for 336,000 stock options.

The Exchange Program was launched to increase the intended retention and incentive value of employee equity awards, reduce the potential dilutive effect of our equity incentive program, and reduce pressure to grant additional equity awards to employees in the short term. Participation in the Exchange Program was made available to all employees in the United States and Singapore except for the Named Executive Officers. Non-employee members of our board of directors were also not eligible to participate. The exchange of options under the Exchange Program resulted in a total incremental charge to compensation expense of $126,000. This incremental charge is being recognized over the vesting periods of the new options. These vesting periods range from one to three years beginning on the first anniversary of the grant.

RSUs

A summary of the RSU activity is as follows:

	Shares			Weighted Average Grant Date Fair Value
Non-vested RSUs at December 31, 2012		100,461		$	7.33
Granted		169,637		$	4.51
Vested		(21,327	)	$	7.54
Cancelled and forfeited		(11,922	)	$	6.72
Non-vested RSUs at September 28, 2013		236,849		$	5.32

RSUs are converted into shares of Intevac common stock upon vesting on a one-for-one basis. RSUs typically are scheduled to vest over four years. Vesting of RSUs is subject to the grantee’s continued service with Intevac. The compensation expense related to these awards is determined using the fair market value of Intevac common stock on the date of the grant, and the compensation expense is recognized over the vesting period.

Performance-based RSUs (“performance-based awards”) granted to certain executive officers are also subject to the achievement of specified performance goals. These performance-based awards become eligible to vest only if performance goals are achieved and then actually will vest only if the grantee remains employed by Intevac through each applicable vesting date. The fair value of these performance-based awards is estimated on the date of grant and assumes that the specified performance goals will be achieved. If the goals are achieved, these awards vest over a specified remaining service period, provided that the grantee remains employed by Intevac through each scheduled vesting date. If the performance goals are not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. The expected cost of each award is reflected over the service period and is reduced for estimated forfeitures. For performance-based awards granted during fiscal 2013, the performance goals require the achievement of targeted revenues and adjusted annual operating profit levels measured at the end of two and three-year periods.

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Contingencies

9 Months Ended

Sep. 28, 2013

Contingencies

18. Contingencies

From time to time, Intevac may have certain contingent liabilities that arise in the ordinary course of its business activities. Intevac accounts for contingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated.

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Information for Each Reportable Segment (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013	Sep. 29, 2012
Segment Reporting Information [Line Items]
Total segment net revenues	$ 19,115	$ 16,834	$ 49,081	$ 65,941
Unallocated costs	(1,751)	(1,429)	(4,436)	(4,417)
Gain (loss) on divestitures			(208)	2,207
Loss from operations	(2,982)	(11,010)	(18,997)	(18,642)
Interest income and other, net	220	(8)	392	411
Loss before income taxes	(2,762)	(11,018)	(18,605)	(18,231)
Operating Segments
Segment Reporting Information [Line Items]
Loss from operations	(1,231)	(9,581)	(14,353)	(16,432)
Equipment
Segment Reporting Information [Line Items]
Total segment net revenues	11,760	7,401	26,293	43,179
Equipment | Operating Segments
Segment Reporting Information [Line Items]
Loss from operations	(1,423)	(10,298)	(14,607)	(15,493)
Intevac Photonics
Segment Reporting Information [Line Items]
Total segment net revenues	7,355	9,433	22,788	22,762
Intevac Photonics | Operating Segments
Segment Reporting Information [Line Items]
Loss from operations	$ 192	$ 717	$ 254	$ (939)

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Activity in Warranty Provision Account (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013	Sep. 29, 2012
Movement in Standard Product Warranty Accrual [Roll Forward]
Opening balance	$ 2,087	$ 2,858	$ 2,349	$ 2,724
Expenditures incurred under warranties	(309)	(197)	(773)	(1,388)
Accruals for product warranties issued during the reporting period	323	218	861	1,093
Adjustments to previously existing warranty accruals	(37)	(330)	(373)	120
Closing balance	$ 2,064	$ 2,549	$ 2,064	$ 2,549

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Derivative Instruments

9 Months Ended

Sep. 28, 2013

Derivative Instruments

12. Derivative Instruments

The Company uses foreign currency forward contracts to mitigate variability in gains and losses generated from the re-measurement of certain monetary assets and liabilities denominated in foreign currencies. These hedges do not qualify for special hedge accounting treatment. These derivatives are carried at fair value with changes recorded in interest income and other, net in the condensed consolidated statements of operations. Changes in the fair value of these derivatives are largely offset by re-measurement of the underlying assets and liabilities. Cash flows from such derivatives are classified as operating activities. The derivatives have maturities of approximately thirty and sixty days. The notional amount of Company’s foreign currency derivatives was $1.7 million at September 28, 2013 and $491,000 at December 31, 2012.

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Future Amortization Expense (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
2013	$ 279
2014	934
2015	854
2016	853
2017	757
Thereafter	1,503
Net Carrying Amount	$ 5,180

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Balance Sheet Classification of Warranty Provision Account (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013	Jun. 29, 2013	Dec. 31, 2012	Sep. 29, 2012	Jun. 30, 2012	Jan. 06, 2012
Product Warranty [Line Items]
Other accrued liabilities	$ 1,974		$ 2,259
Other long-term liabilities	90		90
Total warranty provision	$ 2,064	$ 2,087	$ 2,349	$ 2,549	$ 2,858	$ 2,724

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Equity-Based Compensation - Additional information (Detail) (USD $)	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013 EquityPlan	Sep. 29, 2012	Dec. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Purchase of common stock through payroll deductions			85.00%
Offering periods			2 years
Purchase intervals of a series			6 months
Maximum employee salary withholdings for purchase of common stock under the terms of the ESPP			15.00%
Number of shares issued under employee stock purchase plan			457,000
Number of outstanding stock options	2,621,406		2,621,406		3,128,408
Compensation expense	$ 754,000	$ 943,000	$ 1,836,000	$ 2,941,000
RSU conversion ratio			1
Stock Option Exchange Program
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of option holders exchanged options	87		87
Number of stock options exchanged			766,000
Compensation expense			$ 126,000
Stock Option Exchange Program | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options exercise price per share			$ 8.49
Minimum percentage of closing stock price for exchange to occur			50.00%
Award, vesting period			1 year
Stock Option Exchange Program | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award, vesting period			3 years
2012 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of outstanding stock options	336,000		336,000
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award, vesting period			4 years

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Allowance for Doubtful Accounts (Tables)

9 Months Ended

Sep. 28, 2013

Reconciliation of Allowance for Doubtful Accounts

The following table represents a reconciliation of the allowance for doubtful accounts for the three and nine months ended September 29, 2012:

	Three Months Ended			Nine Months Ended
	September 29, 2012
	(In thousands)
Opening balance	$	—		$	41
Bad debt expense		3,017			3,017
Write-offs		(3,017	)		(3,058	)
Closing balance	$	—		$	—

Bad Debt Expense

The following table summarizes the components of the bad debt expense for the three- and nine month periods ended September 29, 2012 (in thousands):

Promissory note	$	4,085
Deferred profit on installment sale		(1,028	)
Cash recovery from liquidation sale		(40	)
Bad debt expense	$	3,017

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Equity-Based Compensation (Tables)

9 Months Ended

Sep. 28, 2013

Effect of Recording Equity-Based Compensation

The effect of recording equity-based compensation for the three and nine months ended September 28, 2013 and September 29, 2012 was as follows:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(In thousands)
Equity-based compensation by type of award:
Stock options	$	375		$	523		$	651		$	1,843
RSUs		130			88			314			111
Employee stock purchase plan		249			332			871			987
Total equity-based compensation		754			943			1,836			2,941
Tax effect on equity-based compensation		(8	)		(205	)		(18	)		(706	)
Net effect on net loss	$	746		$	738		$	1,818		$	2,235

Option Activity and Changes

Option activity as of September 28, 2013 and changes during the nine months ended September 28, 2013 were as follows:

	Shares			Weighted Average Exercise Price
Options outstanding at December 31, 2012		3,128,408		$	11.52
Options granted		902,770		$	5.59
Options cancelled and forfeited		(1,339,934	)	$	13.73
Options exercised		(69,838	)	$	3.91
Options outstanding at September 28, 2013		2,621,406		$	8.55
Vested and expected to vest at September 28, 2013		2,386,932		$	8.77
Options exercisable at September 28, 2013		1,412,001		$	10.34

Weighted-Average Fair Value of Stock Options and Employee Stock Purchase Rights using Weighted-Average Assumptions

Intevac estimated the weighted-average fair value of stock options and employee stock purchase rights using the following weighted-average assumptions:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
Stock Options:
Weighed-average fair value of grants per share	$	2.81		$	2.87		$	2.48		$	3.90
Expected volatility		55.06	%		63.19	%		56.40	%		63.80	%
Risk free interest rate		1.04	%		0.41	%		1.09	%		0.74	%
Expected term of options (in years)		4.02			3.94			4.22			4.63
Dividend yield		None			None			None			None

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
Stock Purchase Rights:
Weighed-average fair value of grants per share	$	1.97		$	2.31		$	1.63		$	3.01
Expected volatility		43.09	%		63.23	%		51.54	%		62.36	%
Risk free interest rate		0.21	%		0.21	%		0.26	%		0.28	%
Expected term of purchase rights (in years)		1.00			1.85			1.77			1.68
Dividend yield		None			None			None			None

Summary of Restricted Stock Units Activity

A summary of the RSU activity is as follows:

	Shares			Weighted Average Grant Date Fair Value
Non-vested RSUs at December 31, 2012		100,461		$	7.33
Granted		169,637		$	4.51
Vested		(21,327	)	$	7.54
Cancelled and forfeited		(11,922	)	$	6.72
Non-vested RSUs at September 28, 2013		236,849		$	5.32

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Purchased Intangible Assets - Additional Information (Detail) (USD $)	3 Months Ended	9 Months Ended	3 Months Ended
	Sep. 28, 2013	Sep. 28, 2013	Jun. 29, 2013 Equipment	Jun. 29, 2013 In Process Research And Development
Acquired Finite-Lived Intangible Assets [Line Items]
Indefinite-lived intangible asset				$ 4,000,000
Intangible asset , Expected useful life			7 years
Total amortization expense of finite-lived intangibles	$ 279,000	$ 598,000

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Net Loss Per Share (Tables)

9 Months Ended

Sep. 28, 2013

Computation of Basic and Diluted Income (Loss) Per Share

The following table sets forth the computation of basic and diluted loss per share:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(in thousands, except per share amounts)
Net loss	$	(2,745	)	$	(8,007	)	$	(17,421	)	$	(12,661	)
Weighted-average shares — basic		23,931			23,397			23,793			23,293
Effect of dilutive potential common shares		—			—			—			—
Weighted-average shares — diluted		23,931			23,397			23,793			23,293
Net loss per share — basic and diluted	$	(0.11	)	$	(0.34	)	$	(0.73	)	$	(0.54	)
Antidilutive shares based on employee awards excluded		2,551			3,175			2,648			2,999

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Option Activity and Changes (Detail) (USD $)	9 Months Ended
	Sep. 28, 2013
Shares
Options outstanding at December 31, 2012	3,128,408
Options granted	902,770
Options cancelled and forfeited	(1,339,934)
Options exercised	(69,838)
Options outstanding at September 28, 2013	2,621,406
Vested and expected to vest at September 28, 2013	2,386,932
Options exercisable at September 28, 2013	1,412,001
Weighted Average Exercise Price
Options outstanding at December 31, 2012	$ 11.52
Options granted	$ 5.59
Options cancelled and forfeited	$ 13.73
Options exercised	$ 3.91
Options outstanding at September 28, 2013	$ 8.55
Vested and expected to vest at September 28, 2013	$ 8.77
Options exercisable at September 28, 2013	$ 10.34

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Acquisition-Related Contingent Consideration - Additional Information (Detail) (Solar Implant Technologies, USD $) In Millions, unless otherwise specified	Nov. 19, 2010
Milestone
Business Acquisition [Line Items]
Maximum amount of cash potentially earned in contingent compensation arrangements	$ 7.0
Revenue Earnout
Business Acquisition [Line Items]
Maximum amount of cash potentially earned in contingent compensation arrangements	$ 9.0

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Warranty (Tables)

9 Months Ended

Sep. 28, 2013

Activity in Warranty Provision Account

The following table displays the activity in the warranty provision account for the three and nine months ended September 28, 2013 and September 29, 2012:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(In thousands)
Opening balance	$	2,087		$	2,858		$	2,349		$	2,724
Expenditures incurred under warranties		(309	)		(197	)		(773	)		(1,388	)
Accruals for product warranties issued during the reporting period		323			218			861			1,093
Adjustments to previously existing warranty accruals		(37	)		(330	)		(373	)		120
Closing balance	$	2,064		$	2,549		$	2,064		$	2,549

The following table displays the balance sheet classification of the warranty provision account at September 28, 2013 and at December 31, 2012:

	September 28,		December 31,
	2013		2012
	(In thousands)
Other accrued liabilities	$	1,974	$	2,259
Other long-term liabilities		90		90
Total warranty provision	$	2,064	$	2,349

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Changes in Accumulated Other Comprehensive Income by Component (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Sep. 28, 2013	Jun. 29, 2013	Mar. 30, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	$ 670	$ 748	$ 769
Other comprehensive income (loss) before reclassification	63	(78)	(21)
Amounts reclassified from other comprehensive income
Net current-period other comprehensive income (loss)	63	(78)	(21)
Ending Balance	733	670	748
Accumulated Translation Adjustment
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	684	688	694
Other comprehensive income (loss) before reclassification	3	(4)	(6)
Amounts reclassified from other comprehensive income
Net current-period other comprehensive income (loss)	3	(4)	(6)
Ending Balance	687	684	688
Accumulated Net Unrealized Investment Gain (Loss)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	(14)	60	75
Other comprehensive income (loss) before reclassification	60	(74)	(15)
Amounts reclassified from other comprehensive income
Net current-period other comprehensive income (loss)	60	(74)	(15)
Ending Balance	$ 46	$ (14)	$ 60

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Derivative Instruments - Additional Information (Detail) (USD $)	9 Months Ended
	Sep. 28, 2013 Minimum	Sep. 28, 2013 Maximum	Sep. 28, 2013 Foreign currency forward contracts	Dec. 31, 2012 Foreign currency forward contracts
Derivative [Line Items]
Maturity of foreign currency derivative	30 days	60 days
Notional amount of foreign currency derivative			$ 1,700,000	$ 491,000

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Reconciliation of Allowance for Doubtful Accounts (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 29, 2012	Sep. 29, 2012
Provisions for Doubtful Accounts [Line Items]
Opening balance		$ 41
Bad debt expense	3,017	3,017
Write-offs	$ (3,017)	$ (3,058)

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Restructuring Charges - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	1 Months Ended
	Feb. 01, 2013
Restructuring Cost and Reserve [Line Items]
Percentage of reduction of global workforce	18.00%
Minimum
Restructuring Cost and Reserve [Line Items]
Reduction in salary, wages and other employee-related expenses due to implementation of plan	$ 5.5
Maximum
Restructuring Cost and Reserve [Line Items]
Reduction in salary, wages and other employee-related expenses due to implementation of plan	$ 6.0

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Inventories (Tables)

9 Months Ended

Sep. 28, 2013

Inventories Stated at Lower of Average Cost or Market

Inventories are stated at the lower of average cost or market and consist of the following:

	September 28,		December 31,
	2013		2012
	(In thousands)
Raw materials	$	15,778	$	14,921
Work-in-progress		8,327		5,526
Finished goods		1,689		5,746
	$	25,794	$	26,193

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Condensed Consolidated Statements Of Cash Flows (USD $)	9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012
Operating activities
Net loss	$ (17,421,000)	$ (12,661,000)
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:
Depreciation and amortization	3,280,000	3,391,000
Net amortization of investment premiums and discounts	655,000	1,076,000
Net loss on sale of investments		210,000
Bad debt expense		3,017,000
Equity-based compensation	1,836,000	2,941,000
Change in the fair value of acquisition-related contingent consideration	(24,000)	443,000
Deferred income taxes	(1,013,000)	(5,418,000)
Loss (gain) on divestitures	208,000	(2,207,000)
Loss (gain) on disposal of equipment	(153,000)	168,000
Changes in operating assets and liabilities	4,285,000	(5,430,000)
Total adjustments	9,074,000	(1,809,000)
Net cash and cash equivalents used in operating activities	(8,347,000)	(14,470,000)
Investing activities
Purchases of investments	(32,606,000)	(32,987,000)
Proceeds from sales and maturities of investments	31,736,000	41,346,000
Proceeds from sale of equipment	153,000
Purchases of leasehold improvements and equipment	(928,000)	(2,114,000)
Net cash and cash equivalents provided by (used in) investing activities	(1,145,000)	9,245,000
Financing activities
Payment of acquisition-related contingent consideration	(40,000)	(3,345,000)
Net proceeds from issuance of common stock	1,905,000	1,865,000
Net cash and cash equivalents provided by (used in) financing activities	1,865,000	(1,480,000)
Effect of exchange rate changes on cash	(8,000)	4,000
Net decrease in cash and cash equivalents	(7,635,000)	(6,701,000)
Cash and cash equivalents at beginning of period	24,261,000	23,560,000
Cash and cash equivalents at end of period	16,626,000	16,859,000
Non-cash investing activity
Finished goods inventory transferred to property, plant and equipment	1,551,000
DeltaNu
Investing activities
Proceeds from sale of assets	500,000
Mainframe Technology
Investing activities
Proceeds from sale of assets		$ 3,000,000

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Recent Accounting Pronouncement

9 Months Ended

Sep. 28, 2013

Recent Accounting Pronouncement

2. Recent Accounting Pronouncement

Presentation of Unrecognized Tax Benefits: In July 2013, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”) to provide guidance on the presentation of unrecognized tax benefits. ASU 2013-11 requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows: to the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. ASU 2013-11 is effective for us in our first quarter of fiscal 2014 with earlier adoption permitted. ASU 2013-11 should be applied prospectively with retroactive application permitted. We are currently evaluating the impact of our pending adoption of ASU 2013-11 on our consolidated financial statements.

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Allowance for Doubtful Accounts

9 Months Ended

Sep. 28, 2013

Allowance for Doubtful Accounts

5. Allowance for Doubtful Accounts

The following table represents a reconciliation of the allowance for doubtful accounts for the three and nine months ended September 29, 2012:

	Three Months Ended			Nine Months Ended
	September 29, 2012
	(In thousands)
Opening balance	$	—		$	41
Bad debt expense		3,017			3,017
Write-offs		(3,017	)		(3,058	)
Closing balance	$	—		$	—

Intevac held a promissory note from a customer which was secured by the equipment sold to this customer in a prior year under a product and sales agreement. The note was to be repaid in monthly installment payments ending in March 2015. The revenue associated with this sale had been accounted for under the installment method of accounting whereby revenue was recognized only to the extent cash had been received. During the quarter ended September 29, 2012, the customer became delinquent in its monthly installment payments and the note was put on non-accrual status. On September 27, 2012, the customer liquidated its operating assets in an auction. The equipment which collateralized the promissory note was sold in the liquidation auction and Intevac received the proceeds. On September 28, 2012, the customer announced that it was discontinuing its operations effective October 9, 2012 and Intevac concluded that none of the carrying value of the promissory note receivable was collectible and recorded a bad debt charge.

Intevac evaluates the collectibility of trade accounts receivables and notes receivable on an ongoing basis and provides reserves against potential losses when appropriate. Management analyzes historical bad debts, customer concentrations, customer creditworthiness, changes in customer payment tendencies and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. Customer accounts are written off against the allowance when the amount is deemed uncollectible.

The following table summarizes the components of the bad debt expense for the three- and nine month periods ended September 29, 2012 (in thousands):

Promissory note	$	4,085
Deferred profit on installment sale		(1,028	)
Cash recovery from liquidation sale		(40	)
Bad debt expense	$	3,017

The Company did not record any bad debt expense during the nine months ended September 28, 2013.

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Inventories

9 Months Ended

Sep. 28, 2013

Inventories

3. Inventories

Inventories are stated at the lower of average cost or market and consist of the following:

	September 28,		December 31,
	2013		2012
	(In thousands)
Raw materials	$	15,778	$	14,921
Work-in-progress		8,327		5,526
Finished goods		1,689		5,746
	$	25,794	$	26,193

Finished goods inventory consists primarily of completed systems at customer sites that are undergoing installation and acceptance testing and evaluation inventory.

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Weighted-Average Fair Value of Stock Options and Employee Stock Purchase Rights using Weighted-Average Assumptions (Detail) (USD $)	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013	Sep. 29, 2012
Stock Options
Employee stock options weighted-average assumptions
Weighed-average fair value of grants per share	$ 2.81	$ 2.87	$ 2.48	$ 3.90
Expected volatility	55.06%	63.19%	56.40%	63.80%
Risk free interest rate	1.04%	0.41%	1.09%	0.74%
Expected term of options/purchase rights (in years)	4 years 7 days	3 years 11 months 9 days	4 years 2 months 19 days	4 years 7 months 17 days
Dividend yield
Stock Purchase Rights
Employee stock options weighted-average assumptions
Weighed-average fair value of grants per share	$ 1.97	$ 2.31	$ 1.63	$ 3.01
Expected volatility	43.09%	63.23%	51.54%	62.36%
Risk free interest rate	0.21%	0.21%	0.26%	0.28%
Expected term of options/purchase rights (in years)	1 year	1 year 10 months 6 days	1 year 9 months 7 days	1 year 8 months 5 days
Dividend yield

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Purchased Intangible Assets (Tables)

9 Months Ended

Sep. 28, 2013

Details of Finite-lived Intangible Assets by Segment

Details of finite-lived intangible assets by segment as of September 28, 2013, are as follows.

	September 28, 2013
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
	(In thousands)
Equipment	$	7,170	$	(2,551	)	$	4,619
Intevac Photonics		1,215		(654	)		561
	$	8,385	$	(3,205	)	$	5,180

Future Amortization Expense

As of September 28, 2013, future amortization expense is expected to be as follows.

(In thousands)
2013	$	279
2014		934
2015		854
2016		853
2017		757
Thereafter		1,503
	$	5,180

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Cash, Cash Equivalents and Investments (Tables)

9 Months Ended

Sep. 28, 2013

Cash, Cash Equivalents and Short-Term Investments and Long-Term Investments

Cash and cash equivalents, short-term investments and long-term investments consist of:

	September 28, 2013
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Fair Value
	(In thousands)
Cash and cash equivalents:
Cash	$	6,158	$	—	$	—	$	6,158
Money market funds		10,468		—		—		10,468
Total cash and cash equivalents	$	16,626	$	—	$	—	$	16,626
Short-term investments:
Commercial paper	$	997	$	—	$	—	$	997
Corporate bonds and medium-term notes		21,930		23		3		21,950
Municipal bonds		6,113		2		1		6,114
U.S. treasury and agency securities		19,199		13		—		19,212
Variable rate demand notes (“VRDNs”)		160		—		—		160
Total short-term investments	$	48,399	$	38	$	4	$	48,433
Long-term investments:
Corporate bonds and medium-term notes	$	15,576	$	9	$	3	$	15,582
Municipal bonds		1,065		2		—		1,067
U.S. treasury and agency securities		4,008		4		—		4,012
Total long-term investments	$	20,649	$	15	$	3	$	20,661
Total cash, cash equivalents, and investments	$	85,674	$	53	$	7	$	85,720

	December 31. 2012
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Fair Value
	(In thousands)
Cash and cash equivalents:
Cash	$	5,939	$	—	$	—	$	5,939
Money market funds		18,322		—		—		18,322
Total cash and cash equivalents	$	24,261	$	—	$	—	$	24,261
Short-term investments:
Commercial paper	$	2,495	$	—	$	—	$	2,495
Corporate bonds and medium-term notes		19,539		13		4		19,548
Municipal bonds		1,203		1		—		1,204
U.S. treasury and agency securities		16,976		23		—		16,999
VRDNs		345		—		—		345
Total short-term investments	$	40,558	$	37	$	4	$	40,591
Long-term investments:
Corporate bonds and medium-term notes	$	16,776	$	33	$	7	$	16,802
Municipal bonds		1,000		2		—		1,002
U.S. treasury and agency securities		9,499		14		—		9,513
Total long-term investments	$	27,275	$	49	$	7	$	27,317
Total cash, cash equivalents, and investments	$	92,094	$	86	$	11	$	92,169

Contractual Maturities of Available-for-Sale Securities

The contractual maturities of available-for-sale securities at September 28, 2013 are presented in the following table.

	Amortized Cost		Fair Value
	(In thousands)
Due in one year or less	$	55,702	$	55,734
Due after one through two years		22,654		22,668
Due after ten years		1,160		1,160
	$	79,516	$	79,562

Fair Market Value of Investments with Unrealized Losses Not Deemed to be Other-Than Temporarily Impaired

The following table provides the fair market value of Intevac’s investments with unrealized losses that are not deemed to be other-than temporarily impaired as of September 28, 2013.

	September 28, 2013
	In Loss Position for Less than 12 Months				In Loss Position for Greater than 12 Months
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(In thousands)
Corporate bonds and medium-term notes	$	7,802	$	6	$	—	$	—
Municipal bonds		3,112		1		—		—
	$	10,914	$	7	$	—	$	—

Fair Value Hierarchy of Available-for-Sale Securities Measured at Fair Value on Recurring Basis

The following table represents the fair value hierarchy of Intevac’s available-for-sale securities measured at fair value on a recurring basis as of September 28, 2013.

	Fair Value Measurements at September 28, 2013
	Total		Level 1		Level 2
	(In thousands)
Recurring fair value measurements:
Available-for-sale securities
Money market funds	$	10,468	$	10,468	$	—
U.S. treasury and agency securities		23,224		8,703		14,521
Commercial paper		997		—		997
Corporate bonds and medium-term notes		37,532		—		37,532
Municipal bonds		7,181		—		7,181
VRDNs		160		—		160
Total recurring fair value measurements	$	79,562	$	19,171	$	60,391

Changes in Level Three Instruments Consisting of Auction Rate Securities Classified As Available-for-Sale Securities and Measured on Recurring Basis

The following table presents the changes in Level 3 instruments which consisted of Auction Rate Securities (“ARS”) which were classified as available-for-sale securities and which were measured on a recurring basis for the nine month period ended September 29, 2012.

(In thousands)
Opening balance	$	4,490
Total gains (losses) for the period
Included in earnings		(229	)
Included in other comprehensive income		171
Proceeds from tender offers		(2,771	)
Closing balance	$	1,661

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Income Taxes - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013	Sep. 29, 2012
Income Taxes [Line Items]
Income tax benefits	$ (17,000)	$ (3,011,000)	$ (1,184,000)	$ (5,570,000)
Tax benefit from release of certain unrecognized tax benefit liabilities due to lapse of statutes of limitation	213,000		213,000
Discrete income tax charges for accrued withholding tax in Singapore	147,000		231,000
Income tax benefit to bad debt write off				1,100,000
Income tax benefit from valuation allowance				108,000
Income tax benefit refunds received				188,000
Discrete income tax charge related to the gain on sale of mainframe technology				$ 554,000
Foreign Tax Authority
Income Taxes [Line Items]
Tax holiday ending years			2015

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Inventories Stated at Lower of Average Cost or Market (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013	Dec. 31, 2012
Inventory [Line Items]
Raw materials	$ 15,778	$ 14,921
Work-in-progress	8,327	5,526
Finished goods	1,689	5,746
Inventories	$ 25,794	$ 26,193

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Changes in Restructuring Reserves (Detail) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 28, 2013
Restructuring Cost and Reserve [Line Items]
Beginning balance
Provision for restructuring reserves	742
Cash payments made	(742)
Ending balance

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Warranty - Additional Information (Detail)	9 Months Ended
	Sep. 28, 2013
Warranties [Line Items]
Minimum product warranty range	12 months
Maximum product warranty range	24 months
Product warranty offer on sale	3 months

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Reconciliation of Change in Fair Value Measurement of Contingent Consideration Liability (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013	Sep. 29, 2012
Business Acquisition, Contingent Consideration [Line Items]
Opening balance	$ 4,942	$ 6,969	$ 5,151	$ 8,715
Changes in fair value	185	(200)	(24)	443
Cash payments made	(40)	(956)	(40)	(3,345)
Closing balance	$ 5,087	$ 5,813	$ 5,087	$ 5,813

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Bad Debt Expense (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 29, 2012	Sep. 29, 2012
Allowance for Sales Return and Doubtful Accounts [Line Items]
Bad debt expense	$ 3,017	$ 3,017
Promissory note
Allowance for Sales Return and Doubtful Accounts [Line Items]
Bad debt expense		4,085
Deferred profit on installment sale
Allowance for Sales Return and Doubtful Accounts [Line Items]
Bad debt expense		(1,028)
Cash recovery from liquidation sale
Allowance for Sales Return and Doubtful Accounts [Line Items]
Bad debt expense		$ (40)

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Condensed Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Per Share data, unless otherwise specified	Sep. 28, 2013	Dec. 31, 2012
Net of allowances of trade, note and other accounts receivable	$ 0	$ 0
Net of amortization of intangible assets	$ 3,205	$ 2,887
Common Stock, par value	$ 0.001	$ 0.001

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Divestitures

9 Months Ended

Sep. 28, 2013

Divestitures

8. Divestitures

Sale of DeltaNu

On March 29, 2013, the Company sold certain assets, including existing tangible and intangible assets, which comprised its Raman spectroscopy instruments product line, also known as DeltaNu, for consideration not to exceed $1.5 million. Under the terms of the agreement, the acquirer also assumed certain liabilities related to the purchased assets. Payment terms included $500,000 which was paid on the closing date, with the remaining balance to be paid in the form of an earnout of 5% of the acquirer’s Raman spectroscopy instrument sales for 5 years following the closing date which will be due and payable on or before each anniversary of the closing date or a minimum earnout payment of $100,000 annually, whichever is higher. The maximum earnout payments during the payment period shall not exceed $1.0 million.

As the earnout is collected over an extended period of time and in management’s judgment the degree of collectibility is uncertain, Intevac did not recognize the minimum earnout payments upon closing, but instead will record income in the period when the minimum earnout payments can be reasonably estimated for that period and payment is assured.

The following table summarizes the components of the loss (in thousands):

Cash proceeds	$	500
Assets sold:
Accounts receivable		147
Inventories		320
Other current assets		27
Property, plant and equipment		159
Trade name		90
Total assets sold		743
Liabilities divested:
Accounts payable		59
Other accrued expenses		6
Total liabilities divested		65
Transaction and other costs		30
Loss on sale	$	(208	)

Sale of Mainframe Technology

On January 6, 2012, the Company sold certain assets including intellectual property and residual assets which comprised its semiconductor mainframe technology.

The following table summarizes the components of the gain (in thousands):

Cash proceeds	$	3,000
Assets sold:
Inventories		589
Property, plant and equipment		178
Transaction and other costs		26
Gain on sale	$	2,207

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Condensed Consolidated Statements Of Comprehensive Income (Loss) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013	Sep. 29, 2012
Net loss	$ (2,745)	$ (8,007)	$ (17,421)	$ (12,661)
Other comprehensive income (loss), before tax
Change in unrealized net loss on available-for-sale investments	60	73	(29)	305
Foreign currency translation gains (losses)	3	19	(7)	5
Other comprehensive income (loss), before tax	63	92	(36)	310
Income tax (expense) benefit related to items in other comprehensive income (loss)		(26)		(107)
Other comprehensive income (loss), net of tax	63	66	(36)	203
Comprehensive loss	$ (2,682)	$ (7,941)	$ (17,457)	$ (12,458)

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Cash, Cash Equivalents and Short-Term Investments and Long-Term Investments (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013	Dec. 31, 2012
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 85,674	$ 92,094
Unrealized Holdings Gains	53	86
Unrealized Holdings Losses	7	11
Fair Value	85,720	92,169
Cash
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	6,158	5,939
Fair Value	6,158	5,939
Money market funds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	10,468	18,322
Fair Value	10,468	18,322
Cash and Cash Equivalents
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	16,626	24,261
Fair Value	16,626	24,261
Short-term Investments
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	48,399	40,558
Unrealized Holdings Gains	38	37
Unrealized Holdings Losses	4	4
Fair Value	48,433	40,591
Short-term Investments | Commercial Paper
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	997	2,495
Fair Value	997	2,495
Short-term Investments | Corporate bonds and medium-term notes
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	21,930	19,539
Unrealized Holdings Gains	23	13
Unrealized Holdings Losses	3	4
Fair Value	21,950	19,548
Short-term Investments | Municipal bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	6,113	1,203
Unrealized Holdings Gains	2	1
Unrealized Holdings Losses	1
Fair Value	6,114	1,204
Short-term Investments | US Government Agencies Debt Securities
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	19,199	16,976
Unrealized Holdings Gains	13	23
Fair Value	19,212	16,999
Short-term Investments | Variable rate demand notes ("VRDNs")
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	160	345
Fair Value	160	345
Other Long-term Investments
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	20,649	27,275
Unrealized Holdings Gains	15	49
Unrealized Holdings Losses	3	7
Fair Value	20,661	27,317
Other Long-term Investments | Corporate bonds and medium-term notes
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	15,576	16,776
Unrealized Holdings Gains	9	33
Unrealized Holdings Losses	3	7
Fair Value	15,582	16,802
Other Long-term Investments | Municipal bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	1,065	1,000
Unrealized Holdings Gains	2	2
Fair Value	1,067	1,002
Other Long-term Investments | US Government Agencies Debt Securities
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	4,008	9,499
Unrealized Holdings Gains	4	14
Fair Value	$ 4,012	$ 9,513

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 16,626	$ 24,261
Short-term investments	48,433	40,591
Trade and other accounts receivable, net of allowances of $0 at both September 28, 2013 and at December 31, 2012	16,114	19,822
Inventories	25,794	26,193
Prepaid expenses and other current assets	1,750	2,120
Total current assets	108,717	112,987
Property, plant and equipment, net	13,065	13,426
Long-term investments	20,661	27,317
Intangible assets, net of amortization of $3,205 at September 28, 2013 and $2,887 at December 31, 2012	5,180	5,868
Deferred income taxes and other long-term assets	13,730	12,905
Total assets	161,353	172,503
Current liabilities:
Accounts payable	4,719	4,479
Accrued payroll and related liabilities	5,246	4,194
Other accrued liabilities	6,111	8,489
Customer advances	5,862	2,193
Deferred income taxes	1,281	1,281
Total current liabilities	23,219	20,636
Other long-term liabilities	9,250	9,232
Stockholders' equity:
Common stock, $0.001 par value	24	23
Additional paid-in capital	155,701	151,996
Accumulated other comprehensive income	733	769
Accumulated deficit	(27,574)	(10,153)
Total stockholders' equity	128,884	142,635
Total liabilities and stockholders' equity	$ 161,353	$ 172,503

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Balance Sheet Classification of Contingent Consideration Liability (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013	Dec. 31, 2012
Business Combination, Transactions [Line Items]
Contingent consideration liability	$ 5,087	$ 5,151
Other accrued liabilities
Business Combination, Transactions [Line Items]
Contingent consideration liability	42	265
Other long-term liabilities
Business Combination, Transactions [Line Items]
Contingent consideration liability	$ 5,045	$ 4,886

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Acquisition-Related Contingent Consideration (Tables)

9 Months Ended

Sep. 28, 2013

Reconciliation of Change in Fair Value Measurement of Contingent Consideration Liability

The following table represents a reconciliation of the change in the fair value measurement of the contingent consideration liability for the three and nine month periods ended September 28, 2013 and September 29, 2012.

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(In thousands)
Opening balance	$	4,942		$	6,969		$	5,151		$	8,715
Changes in fair value		185			(200	)		(24	)		443
Cash payments made		(40	)		(956	)		(40	)		(3,345	)
Closing balance	$	5,087		$	5,813		$	5,087		$	5,813

Balance Sheet Classification of Contingent Consideration Liability

The following table displays the balance sheet classification of the contingent consideration liability account at September 28, 2013 and at December 31, 2012:

	September 28,		December 31,
	2013		2012
	(In thousands)
Other accrued liabilities	$	42	$	265
Other long-term liabilities		5,045		4,886
Total acquisition-related contingent consideration	$	5,087	$	5,151

Quantitative Information of Significant Unobservable Inputs of Contingent Consideration Liability

The following table represents the quantitative range of the significant unobservable inputs used in the calculation of fair value of the continent consideration liability as of September 28, 2013. Significant increases or decreases in any of these inputs in isolation would result in a significantly lower (higher) fair value measurement.

	Quantitative Information about Level 3 Fair Value Measurements at September  28, 2013
	Fair Value	Valuation Technique	Unobservable Input	Range (Weighted Average)
	(In thousands, except for percentages)
Revenue Earnout	$    5,087	Discounted cash flow	Weighted average cost of capital	16.0%
			Probability weighting of achieving revenue forecasts	15.0% - 50.0% (31.7%)

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Income Taxes

9 Months Ended

Sep. 28, 2013

Income Taxes

17. Income Taxes

Intevac recorded income tax benefits of $17,000 and $1.2 million for the three and nine months ended September 28, 2013, respectively. Intevac recorded income tax benefits of $3.0 million and $5.6 million for the three and nine months ended September 29, 2012, respectively. The income tax provision for the three and nine month periods are based upon estimates of annual income (loss), annual permanent differences and statutory tax rates in the various jurisdictions in which Intevac operates, except that certain discrete items are treated separately. At the end of 2012 Intevac established a valuation allowance against the majority of the U.S. deferred tax assets. As a result, Intevac did not recognize a benefit on the U.S. net operating loss for the three and nine months ended September 28, 2013.

The income tax benefit for both the three and nine month periods ended September 28, 2013 includes a $213,000 tax benefit from the release of certain unrecognized tax benefit liabilities due to the lapse of statutes of limitation. The income tax benefit for the three and nine month periods ended September 28, 2013 was reduced by discrete income tax charges for accrued withholding tax in Singapore of $147,000 and $231,000, respectively. The income tax benefit for the nine months ended September 29, 2012 includes the following discrete income tax items: (i) $1.1 million tax benefit related to a bad debt write-off, (ii) $108,000 tax benefit from the release of a valuation allowance and (iii) $188,000 in tax refunds received from Singapore and California, which were offset in part by (iv) $554,000 discrete income tax charge related to the gain on the sale of the mainframe technology.

Intevac’s tax rate differs from the applicable statutory rates due primarily to establishment of valuation allowances, the utilization of deferred and current credits and the effect of permanent differences and adjustments of prior permanent differences. Intevac’s future effective income tax rate depends on various factors including, the level of Intevac’s projected earnings, the geographic composition of worldwide earnings, tax regulations governing each region, net operating loss carry-forwards, availability of tax credits and the effectiveness of Intevac’s tax planning strategies. Management carefully monitors these factors and timely adjusts the effective income tax rate accordingly.

Intevac has benefitted from a tax holiday in Singapore which is scheduled to expire at the end of 2015. The tax holiday provides a lower income tax rate on certain classes of income so long as certain thresholds of business investment and employment levels are met in Singapore. We are presently in discussion with the Singapore tax authority to terminate this tax holiday effective January 1, 2013 due to current conditions in the hard disk drive business, which will not allow Intevac to be able to meet the conditions required to continue benefitting from the tax holiday. We expect the Singapore tax authorities to issue the terms and conditions allowing us to terminate the tax holiday early during the fourth quarter of 2013.

Intevac is subject to income taxes in the U.S. federal jurisdiction, and various state and foreign jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, Intevac is not subject to U.S. federal, state and local, or international jurisdictions income tax examinations by tax authorities for the years before 2010. Tax years 1999 through 2010 are subject to income tax examinations by U.S. federal and California tax authorities to the extent of tax credit carry forwards remaining or utilized in an otherwise open year. Tax years 2010 through 2012 generally remain open for examinations by the tax authorities. During 2012, the Internal Revenue Service completed its review of the Company’s fiscal year 2009 tax return which arose from an income tax refund generated by a carry-back claim. Additionally, the Singapore Inland Revenue Authority is conducting an examination of the fiscal 2009 and 2010 tax returns of the Company’s wholly-owned subsidiary, Intevac Asia Pte. Ltd. Presently there are no other active income tax examinations in the jurisdictions where Intevac operates.

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Allowance for Doubtful Accounts - Additional Information (Detail) (USD $)	Sep. 29, 2012
Allowance for Sales Return and Doubtful Accounts [Line Items]
Carrying value of promissory note receivable	$ 0

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Components of Gain (Loss) (Detail) (USD $) In Thousands, unless otherwise specified	9 Months Ended		3 Months Ended	1 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Mar. 30, 2013 DeltaNu	Jan. 06, 2012 Mainframe Technology
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash proceeds			$ 500	$ 3,000
Assets sold:
Accounts receivable			147
Inventories			320	589
Other current assets			27
Property, plant and equipment			159	178
Trade name			90
Total assets sold			743
Liabilities divested:
Accounts payable			59
Other accrued expenses			6
Total liabilities divested			65
Transaction and other costs			30	26
Gain (Loss) on sale	$ (208)	$ 2,207	$ (208)	$ 2,207

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Computation of Basic and Diluted Income (Loss) Per Share (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013	Sep. 29, 2012
Schedule Of Computation Of Basic And Diluted Earnings Per Common Share [Line Items]
Net loss	$ (2,745)	$ (8,007)	$ (17,421)	$ (12,661)
Weighted-average shares - basic	23,931	23,397	23,793	23,293
Effect of dilutive potential common shares
Weighted-average shares - diluted	23,931	23,397	23,793	23,293
Net loss per share - basic and diluted	$ (0.11)	$ (0.34)	$ (0.73)	$ (0.54)
Antidilutive shares based on employee awards excluded	2,551	3,175	2,648	2,999

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Effect of Recording Equity-Based Compensation (Detail) (USD $)	3 Months Ended		9 Months Ended
	Sep. 28, 2013	Sep. 29, 2012	Sep. 28, 2013	Sep. 29, 2012
Equity Based Compensation Related to Employee Stock Purchase Programs [Line Items]
Total equity-based compensation	$ 754,000	$ 943,000	$ 1,836,000	$ 2,941,000
Tax effect on equity-based compensation	(8,000)	(205,000)	(18,000)	(706,000)
Net effect on net loss	746,000	738,000	1,818,000	2,235,000
Stock Options
Equity Based Compensation Related to Employee Stock Purchase Programs [Line Items]
Total equity-based compensation	375,000	523,000	651,000	1,843,000
RSUs
Equity Based Compensation Related to Employee Stock Purchase Programs [Line Items]
Total equity-based compensation	130,000	88,000	314,000	111,000
Employee Stock Purchase Plan
Equity Based Compensation Related to Employee Stock Purchase Programs [Line Items]
Total equity-based compensation	$ 249,000	$ 332,000	$ 871,000	$ 987,000

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Segment Reporting (Tables)

9 Months Ended

Sep. 28, 2013

Information for Each Reportable Segment

Information for each reportable segment for the three and nine months ended September 28, 2013 and September 29, 2012 is as follows:

Net Revenues

	Three Months Ended				Nine Months Ended
	September 28, 2013		September 29, 2012		September 28, 2013		September 29, 2012
	(in thousands)
Equipment	$	11,760	$	7,401	$	26,293	$	43,179
Intevac Photonics		7,355		9,433		22,788		22,762
Total segment net revenues	$	19,115	$	16,834	$	49,081	$	65,941

Operating Income (Loss)

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(in thousands)
Equipment	$	(1,423	)	$	(10,298	)	$	(14,607	)	$	(15,493	)
Intevac Photonics		192			717			254			(939	)
Total segment operating income (loss)		(1,231	)		(9,581	)		(14,353	)		(16,432	)
Unallocated costs		(1,751	)		(1,429	)		(4,436	)		(4,417	)
Gain (loss) on divestitures		—			—			(208	)		2,207
Loss from operations		(2,982	)		(11,010	)		(18,997	)		(18,642	)
Interest income and other, net		220			(8	)		392			411
Loss before income taxes	$	(2,762	)	$	(11,018	)	$	(18,605	)	$	(18,231	)

Assets for Each Reportable Segment

Total assets for each reportable segment as of September 28, 2013 and December 31, 2012 are as follows:

Assets

	September 28, 2013		December 31, 2012
	(In thousands)
Equipment	$	39,825	$	37,376
Intevac Photonics		19,847		27,052
Total segment assets		59,672		64,428
Cash, cash equivalents and investments		85,720		92,169
Deferred income taxes		13,189		12,176
Other current assets		1,011		1,870
Common property, plant and equipment		1,283		1,211
Other assets		478		649
Consolidated total assets	$	161,353	$	172,503

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Restructuring Charges (Tables)

9 Months Ended

Sep. 28, 2013

Changes in Restructuring Reserves

The changes in restructuring reserves associated with the Plan for the nine months ended September 28, 2013, are as follows.

	Severance and other employee- related costs
	(In thousands)
Balance at December 31, 2012	$	—
Provision for restructuring reserves		742
Cash payments made		(742	)
Balance at September 28, 2013	$	—

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Acquisition-Related Contingent Consideration

9 Months Ended

Sep. 28, 2013

Acquisition-Related Contingent Consideration

7. Acquisition-Related Contingent Consideration

In connection with the acquisition of Solar Implant Technologies, Inc. (“SIT”), Intevac agreed to pay up to an aggregate of $7.0 million in cash to the selling shareholders if certain milestones were achieved over a specified period. Intevac has made payments to the selling shareholders for achievement of the first milestone in 2011 and for achievement of the second and third milestones in 2012. The fourth and final milestone was not achieved on the targeted date outlined in the acquisition agreement and will not be paid. There is no remaining contingent consideration obligation associated with the milestone payments at September 28, 2013.

In connection with the acquisition of SIT, Intevac also agreed to pay to the selling shareholders in cash a revenue earnout on Intevac’s net revenue from commercial sales of certain products over a specified period up to an aggregate of $9.0 million. Intevac estimated the fair value of this contingent consideration on September 28, 2013 based on probability-based forecasted revenues reflecting Intevac’s own assumptions concerning future revenue from such products. As of September 28, 2013, payments made in connection with the revenue earnout obligation have not been significant.

The fair value measurement of contingent consideration is based on significant inputs not observed in the market and thus represents a Level 3 measurement. Any change in fair value of the contingent consideration subsequent to the acquisition date is recognized in operating income within the statement of operations. The following table represents a reconciliation of the change in the fair value measurement of the contingent consideration liability for the three and nine month periods ended September 28, 2013 and September 29, 2012.

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(In thousands)
Opening balance	$	4,942		$	6,969		$	5,151		$	8,715
Changes in fair value		185			(200	)		(24	)		443
Cash payments made		(40	)		(956	)		(40	)		(3,345	)
Closing balance	$	5,087		$	5,813		$	5,087		$	5,813

The following table displays the balance sheet classification of the contingent consideration liability account at September 28, 2013 and at December 31, 2012:

	September 28,		December 31,
	2013		2012
	(In thousands)
Other accrued liabilities	$	42	$	265
Other long-term liabilities		5,045		4,886
Total acquisition-related contingent consideration	$	5,087	$	5,151

The following table represents the quantitative range of the significant unobservable inputs used in the calculation of fair value of the continent consideration liability as of September 28, 2013. Significant increases or decreases in any of these inputs in isolation would result in a significantly lower (higher) fair value measurement.

	Quantitative Information about Level 3 Fair Value Measurements at September  28, 2013
	Fair Value	Valuation Technique	Unobservable Input	Range (Weighted Average)
	(In thousands, except for percentages)
Revenue Earnout	$    5,087	Discounted cash flow	Weighted average cost of capital	16.0%
			Probability weighting of achieving revenue forecasts	15.0% - 50.0% (31.7%)

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Changes in Level Three Instruments Consisting of Auction Rate Securities Classified As Available-for-Sale Securities and Measured on Recurring Basis (Detail) (Fair Value, Measurements, Recurring, Auction rate securities ("ARS"), Fair Value, Inputs, Level 3, USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 29, 2012
Fair Value, Measurements, Recurring | Auction rate securities ("ARS") | Fair Value, Inputs, Level 3
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Opening balance	$ 4,490
Total gains (losses) for the period Included in earnings	(229)
Included in other comprehensive income	171
Proceeds from tender offers	(2,771)
Closing balance	$ 1,661

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Divestitures (Tables)

9 Months Ended

Sep. 28, 2013

DeltaNu

Summary of Components of Gain (Loss)

The following table summarizes the components of the loss (in thousands):

Cash proceeds	$	500
Assets sold:
Accounts receivable		147
Inventories		320
Other current assets		27
Property, plant and equipment		159
Trade name		90
Total assets sold		743
Liabilities divested:
Accounts payable		59
Other accrued expenses		6
Total liabilities divested		65
Transaction and other costs		30
Loss on sale	$	(208	)

Mainframe Technology

Summary of Components of Gain (Loss)

The following table summarizes the components of the gain (in thousands):

Cash proceeds	$	3,000
Assets sold:
Inventories		589
Property, plant and equipment		178
Transaction and other costs		26
Gain on sale	$	2,207

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Summary of Restricted Stock Units Activity (Detail) (Restricted Stock Units (RSUs), USD $)	9 Months Ended
	Sep. 28, 2013
Restricted Stock Units (RSUs)
Shares
Non-vested RSUs at December 31, 2012	100,461
Granted	169,637
Vested	(21,327)
Cancelled and forfeited	(11,922)
Non-vested RSUs at September 28, 2013	236,849
Weighted Average Grant Date Fair Value
Non-vested RSUs at December 31, 2012	$ 7.33
Granted	$ 4.51
Vested	$ 7.54
Cancelled and forfeited	$ 6.72
Non-vested RSUs at September 28, 2013	$ 5.32

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Guarantees

9 Months Ended

Sep. 28, 2013

Guarantees

10. Guarantees

Officer and Director Indemnifications

As permitted or required under Delaware law and to the maximum extent allowable under that law, Intevac has certain obligations to indemnify its current and former officers and directors for certain events or occurrences while the officer or director is, or was serving, at Intevac’s request in such capacity. These indemnification obligations are valid as long as the director or officer acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Company and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. The maximum potential amount of future payments Intevac could be required to make under these indemnification obligations is unlimited; however, Intevac has a director and officer insurance policy that mitigates Intevac’s exposure and enables Intevac to recover a portion of any future amounts paid. As a result of Intevac’s insurance policy coverage, Intevac believes the estimated fair value of these indemnification obligations is not material.

Other Indemnifications

As is customary in Intevac’s industry, many of Intevac’s contracts provide remedies to certain third parties such as defense, settlement, or payment of judgments for intellectual property claims related to the use of its products. Such indemnification obligations may not be subject to maximum loss clauses. Historically, payments made related to these indemnifications have been immaterial.

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Purchased Intangible Assets

9 Months Ended

Sep. 28, 2013

Purchased Intangible Assets

6. Purchased Intangible Assets

Intevac’s indefinite-lived intangible asset consisted of in-process research and development (“IPR&D”) in the amount of $4.0 million in the Equipment segment. During the quarter ended June 29, 2013, the related development project was completed, the product achieved commercialization and Intevac began amortizing the intangible asset over its expected useful life of 7 years. Immediately prior to commencement of amortization Intevac tested the intangible asset for impairment and determined that it was not impaired.

Details of finite-lived intangible assets by segment as of September 28, 2013, are as follows.

	September 28, 2013
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
	(In thousands)
Equipment	$	7,170	$	(2,551	)	$	4,619
Intevac Photonics		1,215		(654	)		561
	$	8,385	$	(3,205	)	$	5,180

Total amortization expense of finite-lived intangibles for the three and nine months ended September 28, 2013 was $279,000 and $598,000.

As of September 28, 2013, future amortization expense is expected to be as follows.

(In thousands)
2013	$	279
2014		934
2015		854
2016		853
2017		757
Thereafter		1,503
	$	5,180

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Basis of Presentation

9 Months Ended

Sep. 28, 2013

Basis of Presentation

1. Basis of Presentation

In the opinion of management, the unaudited interim condensed consolidated financial statements of Intevac, Inc. and its subsidiaries (Intevac or the Company) included herein have been prepared on a basis consistent with the December 31, 2012 audited consolidated financial statements and include all material adjustments, consisting of normal recurring adjustments, necessary to fairly present the information set forth therein. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in Intevac’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012 (“2012 Form 10-K”). Intevac’s results of operations for the three and nine months ended September 28, 2013 are not necessarily indicative of future operating results.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make judgments, estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates.

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Quantitative Range of Significant Unobservable Inputs Used in Calculation of Fair Value of Continent Consideration Liability (Detail) (USD $) In Thousands, unless otherwise specified			9 Months Ended
	Sep. 28, 2013	Dec. 31, 2012	Sep. 28, 2013 Fair Value, Inputs, Level 3 Revenue Earnout	Sep. 28, 2013 Fair Value, Inputs, Level 3 Revenue Earnout Weighted Average	Sep. 28, 2013 Fair Value, Inputs, Level 3 Revenue Earnout Minimum	Sep. 28, 2013 Fair Value, Inputs, Level 3 Revenue Earnout Maximum
Business Acquisition, Contingent Consideration [Line Items]
Weighted average cost of capital				16.00%
Probability weighting of achieving revenue forecasts				31.70%	15.00%	50.00%
Discounted cash flow			Discounted cash flow
Fair Value	$ 5,087	$ 5,151	$ 5,087

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Details of Finite-lived Intangible Assets by Segment (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013	Dec. 31, 2012
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 8,385
Accumulated Amortization	(3,205)	(2,887)
Net Carrying Amount	5,180
Equipment
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	7,170
Accumulated Amortization	(2,551)
Net Carrying Amount	4,619
Intevac Photonics
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	1,215
Accumulated Amortization	(654)
Net Carrying Amount	$ 561

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Accumulated Other Comprehensive Income (Tables)

9 Months Ended

Sep. 28, 2013

Change in Accumulated Other Comprehensive Income by Component

The changes in accumulated other comprehensive income by component for the three and nine months ended September 28, 2013, are as follows.

	Foreign currency			Unrealized holding gains on available- for-sale investments			Total
	(In thousands)
Balance at December 31, 2012	$	694		$	75		$	769
Other comprehensive loss before reclassification		(6	)		(15	)		(21	)
Amounts reclassified from other comprehensive income		—			—			—
Net current-period other comprehensive loss		(6	)		(15	)		(21	)
Balance at March 30, 2013	$	688		$	60		$	748
Other comprehensive loss before reclassification		(4	)		(74	)		(78	)
Amounts reclassified from other comprehensive income		—			—			—
Net current-period other comprehensive loss		(4	)		(74	)		(78	)
Balance at June 29, 2013	$	684		$	(14	)	$	670
Other comprehensive income (loss) before reclassification		3			60			63
Amounts reclassified from other comprehensive income		—			—			—
Net current-period other comprehensive income (loss)		3			60			63
Balance at September 28, 2013	$	687		$	46		$	733

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Segment Reporting - Additional Information (Detail)	9 Months Ended
	Sep. 28, 2013 Segment
Segment Reporting Disclosure [Line Items]
Number of reportable segments	2
Allocation of corporate expenses to the segments	3.00%

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Contractual Maturities of Available-For-Sale Securities (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013
Amortized Cost
Amortized Cost, Due in one year or less	$ 55,702
Amortized Cost, Due after one through two years	22,654
Amortized Cost, Due after ten years	1,160
Amortized Cost	79,516
Fair Value
Fair Value, Due in one year or less	55,734
Fair Value, Due after one through two years	22,668
Fair Value, Due after ten years	1,160
Fair Value	$ 79,562

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Accumulated Other Comprehensive Income

9 Months Ended

Sep. 28, 2013

Accumulated Other Comprehensive Income

13. Accumulated Other Comprehensive Income

The changes in accumulated other comprehensive income by component for the three and nine months ended September 28, 2013, are as follows.

	Foreign currency			Unrealized holding gains on available- for-sale investments			Total
	(In thousands)
Balance at December 31, 2012	$	694		$	75		$	769
Other comprehensive loss before reclassification		(6	)		(15	)		(21	)
Amounts reclassified from other comprehensive income		—			—			—
Net current-period other comprehensive loss		(6	)		(15	)		(21	)
Balance at March 30, 2013	$	688		$	60		$	748
Other comprehensive loss before reclassification		(4	)		(74	)		(78	)
Amounts reclassified from other comprehensive income		—			—			—
Net current-period other comprehensive loss		(4	)		(74	)		(78	)
Balance at June 29, 2013	$	684		$	(14	)	$	670
Other comprehensive income (loss) before reclassification		3			60			63
Amounts reclassified from other comprehensive income		—			—			—
Net current-period other comprehensive income (loss)		3			60			63
Balance at September 28, 2013	$	687		$	46		$	733

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Warranty

9 Months Ended

Sep. 28, 2013

Warranty

9. Warranty

Intevac provides for the estimated cost of warranty when revenue is recognized. Intevac’s warranty is per contract terms, and for systems sold directly the warranty typically ranges between 12 and 24 months from customer acceptance. For systems sold through a distributor, Intevac offers a 3 month warranty. The remainder of any warranty period is the responsibility of the distributor. During this warranty period any defective non-consumable parts are replaced and installed at no charge to the customer. The warranty period on consumable parts is limited to their reasonable usable lives. Intevac uses estimated repair or replacement costs along with its historical warranty experience to determine its warranty obligation. Intevac generally provides a twelve month warranty on its Intevac Photonics products. The provision for the estimated future costs of warranty is based upon historical cost and product performance experience. Intevac exercises judgment in determining the underlying estimates.

On the condensed consolidated balance sheets, the short-term portion of the warranty provision is included in other accrued liabilities, while the long-term portion is included in other long-term liabilities. The expense associated with product warranties issued or adjusted is included in cost of net revenues on the condensed consolidated statements of operations.

The following table displays the activity in the warranty provision account for the three and nine months ended September 28, 2013 and September 29, 2012:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(In thousands)
Opening balance	$	2,087		$	2,858		$	2,349		$	2,724
Expenditures incurred under warranties		(309	)		(197	)		(773	)		(1,388	)
Accruals for product warranties issued during the reporting period		323			218			861			1,093
Adjustments to previously existing warranty accruals		(37	)		(330	)		(373	)		120
Closing balance	$	2,064		$	2,549		$	2,064		$	2,549

The following table displays the balance sheet classification of the warranty provision account at September 28, 2013 and at December 31, 2012:

	September 28,		December 31,
	2013		2012
	(In thousands)
Other accrued liabilities	$	1,974	$	2,259
Other long-term liabilities		90		90
Total warranty provision	$	2,064	$	2,349

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Assets for Each Reportable Segment (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013	Dec. 31, 2012
Segment Reporting, Asset Reconciling Item [Line Items]
Cash, cash equivalents and investments	$ 85,720	$ 92,169
Deferred income taxes	13,189	12,176
Other current assets	1,011	1,870
Common property, plant and equipment	1,283	1,211
Other assets	478	649
Consolidated total assets	161,353	172,503
Operating Segments
Segment Reporting, Asset Reconciling Item [Line Items]
Consolidated total assets	59,672	64,428
Operating Segments | Equipment
Segment Reporting, Asset Reconciling Item [Line Items]
Consolidated total assets	39,825	37,376
Operating Segments | Intevac Photonics
Segment Reporting, Asset Reconciling Item [Line Items]
Consolidated total assets	$ 19,847	$ 27,052

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Restructuring Charges

9 Months Ended

Sep. 28, 2013

Restructuring Charges

16. Restructuring Charges

On February 1, 2013, Intevac announced the 2013 cost reduction plan (the “Plan”) to reduce expenses including a reduction in its workforce. Implementation of the Plan was substantially completed in the first half of fiscal 2013 and the Company reduced its workforce by 18 percent. The cost of implementing the Plan was reported under cost of products sold and operating expenses in the condensed consolidated statements of operations. Substantially all cash outlays in connection with the Plan occurred in the first half of fiscal 2013. Implementation of the Plan is expected to reduce salary, wages and other employee-related expenses by approximately $5.5 million to $6.0 million on an annual basis.

The changes in restructuring reserves associated with the Plan for the nine months ended September 28, 2013, are as follows.

	Severance and other employee- related costs
	(In thousands)
Balance at December 31, 2012	$	—
Provision for restructuring reserves		742
Cash payments made		(742	)
Balance at September 28, 2013	$	—

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Net Loss Per Share

9 Months Ended

Sep. 28, 2013

Net Loss Per Share

14. Net Loss Per Share

The following table sets forth the computation of basic and diluted loss per share:

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(in thousands, except per share amounts)
Net loss	$	(2,745	)	$	(8,007	)	$	(17,421	)	$	(12,661	)
Weighted-average shares — basic		23,931			23,397			23,793			23,293
Effect of dilutive potential common shares		—			—			—			—
Weighted-average shares — diluted		23,931			23,397			23,793			23,293
Net loss per share — basic and diluted	$	(0.11	)	$	(0.34	)	$	(0.73	)	$	(0.54	)
Antidilutive shares based on employee awards excluded		2,551			3,175			2,648			2,999

Potentially dilutive common shares consist of shares issuable upon exercise of employee stock options and vesting of RSUs and are excluded from the calculation of diluted EPS when their effect would be anti-dilutive.

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Document and Entity Information	9 Months Ended
	Sep. 28, 2013	Oct. 29, 2013
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 28, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3
Trading Symbol	IVAC
Entity Registrant Name	INTEVAC INC
Entity Central Index Key	0001001902
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		24,006,002

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Segment Reporting

9 Months Ended

Sep. 28, 2013

Segment Reporting

15. 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 September 28, 2013 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 markets vacuum process equipment solutions for high-volume manufacturing of small substrates with precise thin film properties for hard drive and solar cell manufacturers.

The Intevac Photonics segment develops compact, cost-effective, high-sensitivity digital-optical products for the capture and display of low-light images. Intevac provides sensors, cameras and systems for government applications such as night vision and long-range target identification.

Information for each reportable segment for the three and nine months ended September 28, 2013 and September 29, 2012 is as follows:

Net Revenues

	Three Months Ended				Nine Months Ended
	September 28, 2013		September 29, 2012		September 28, 2013		September 29, 2012
	(in thousands)
Equipment	$	11,760	$	7,401	$	26,293	$	43,179
Intevac Photonics		7,355		9,433		22,788		22,762
Total segment net revenues	$	19,115	$	16,834	$	49,081	$	65,941

Operating Income (Loss)

	Three Months Ended						Nine Months Ended
	September 28, 2013			September 29, 2012			September 28, 2013			September 29, 2012
	(in thousands)
Equipment	$	(1,423	)	$	(10,298	)	$	(14,607	)	$	(15,493	)
Intevac Photonics		192			717			254			(939	)
Total segment operating income (loss)		(1,231	)		(9,581	)		(14,353	)		(16,432	)
Unallocated costs		(1,751	)		(1,429	)		(4,436	)		(4,417	)
Gain (loss) on divestitures		—			—			(208	)		2,207
Loss from operations		(2,982	)		(11,010	)		(18,997	)		(18,642	)
Interest income and other, net		220			(8	)		392			411
Loss before income taxes	$	(2,762	)	$	(11,018	)	$	(18,605	)	$	(18,231	)

Total assets for each reportable segment as of September 28, 2013 and December 31, 2012 are as follows:

Assets

	September 28, 2013		December 31, 2012
	(In thousands)
Equipment	$	39,825	$	37,376
Intevac Photonics		19,847		27,052
Total segment assets		59,672		64,428
Cash, cash equivalents and investments		85,720		92,169
Deferred income taxes		13,189		12,176
Other current assets		1,011		1,870
Common property, plant and equipment		1,283		1,211
Other assets		478		649
Consolidated total assets	$	161,353	$	172,503

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Fair Value Hierarchy of Available-for-Sale Securities Measured at Fair Value on Recurring Basis (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	$ 79,562
Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	79,562
Fair Value, Measurements, Recurring | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	10,468
Fair Value, Measurements, Recurring | US treasury and agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	23,224
Fair Value, Measurements, Recurring | Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	997
Fair Value, Measurements, Recurring | Corporate bonds and medium-term notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	37,532
Fair Value, Measurements, Recurring | Municipal bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	7,181
Fair Value, Measurements, Recurring | Variable rate demand notes ("VRDNs")
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	160
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	19,171
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	10,468
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | US treasury and agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	8,703
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	60,391
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | US treasury and agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	14,521
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	997
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Corporate bonds and medium-term notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	37,532
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Municipal bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	7,181
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Variable rate demand notes ("VRDNs")
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total recurring fair value measurements	$ 160

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Fair Market Value of Investments with Unrealized Losses Not Deemed to be Other-Than Temporarily Impaired (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 28, 2013
Schedule of Available-for-sale Securities [Line Items]
Unrealized Loss Position, Less than 12 Months, Fair Value	$ 10,914
Unrealized Loss Position, Less than 12 Months, Gross Unrealized Losses	7
Unrealized Loss Position, Greater than 12 Months, Fair Value
Unrealized Loss Position, Greater than 12 Months, Gross Unrealized Losses
Corporate bonds and medium-term notes
Schedule of Available-for-sale Securities [Line Items]
Unrealized Loss Position, Less than 12 Months, Fair Value	7,802
Unrealized Loss Position, Less than 12 Months, Gross Unrealized Losses	6
Unrealized Loss Position, Greater than 12 Months, Fair Value
Unrealized Loss Position, Greater than 12 Months, Gross Unrealized Losses
Municipal bonds
Schedule of Available-for-sale Securities [Line Items]
Unrealized Loss Position, Less than 12 Months, Fair Value	3,112
Unrealized Loss Position, Less than 12 Months, Gross Unrealized Losses	1
Unrealized Loss Position, Greater than 12 Months, Fair Value
Unrealized Loss Position, Greater than 12 Months, Gross Unrealized Losses