QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(IRS Employer Identification No.) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
Large accelerated filer |
☐ |
☒ | ||||
Non-accelerated filer |
☐ |
Smaller reporting company |
||||
Emerging growth company |
No. |
Page |
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PART I. FINANCIAL INFORMATION |
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Item 1. |
Financial Statements (unaudited) |
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3 |
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4 |
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5 |
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6 |
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7 |
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Item 2. |
24 |
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Item 3. |
31 |
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Item 4. |
32 |
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PART II. OTHER INFORMATION |
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Item 1. |
33 |
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Item 1A. |
33 |
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Item 2. |
39 |
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Item 3. |
39 |
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Item 4. |
39 |
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Item 5. |
40 |
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Item 6. |
40 |
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41 |
Item 1. |
Financial Statements |
June 27, 2020 |
December 28, 2019 |
|||||||
(Unaudited) |
||||||||
(In thousands, except par value) |
||||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | |
$ | |
||||
Short-term investments |
|
|
||||||
Trade and other accounts receivable, net of allowances of $ |
|
|
||||||
Inventories |
|
|
||||||
Prepaid expenses and other current assets |
|
|
||||||
Total current assets |
|
|
||||||
Long-term investments |
|
|
||||||
Restricted cash |
|
|
||||||
Property, plant and equipment, net |
|
|
||||||
Operating lease right-of-use-assets |
|
|
||||||
Intangible assets, net of accumulated amortization of $ |
|
|
||||||
Deferred income taxes and other long-term assets |
|
|
||||||
Total assets |
$ | |
$ | |
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
Current liabilities: |
||||||||
Current operating lease liabilities |
$ | |
$ | |
||||
Accounts payable |
|
|
||||||
Accrued payroll and related liabilities |
|
|
||||||
Other accrued liabilities |
|
|
||||||
Customer advances |
|
|
||||||
Total current liabilities |
|
|
||||||
Noncurrent liabilities: |
||||||||
Noncurrent operating lease liabilities |
|
|
||||||
Other long-term liabilities |
|
|
||||||
Total noncurrent liabilities |
|
|
||||||
Stockholders’ equity: |
||||||||
Common stock, $ |
|
|
||||||
Additional paid-in capital |
|
|
||||||
Treasury stock, |
( |
) | ( |
) | ||||
Accumulated other comprehensive income |
|
|
||||||
Accumulated deficit |
( |
) | ( |
) | ||||
Total stockholders’ equity |
|
|
||||||
Total liabilities and stockholders’ equity |
$ | |
$ | |
||||
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
(Unaudited) |
||||||||||||||||
(In thousands, except per share amounts) |
||||||||||||||||
Net revenues: |
||||||||||||||||
Systems and components |
$ | |
$ | |
$ | |
$ | |
||||||||
Technology development |
|
|
|
|
||||||||||||
Total net revenues |
|
|
|
|
||||||||||||
Cost of net revenues: |
||||||||||||||||
Systems and components |
|
|
|
|
||||||||||||
Technology development |
|
|
|
|
||||||||||||
Total cost of net revenues |
|
|
|
|
||||||||||||
Gross profit |
|
|
|
|
||||||||||||
Operating expenses: |
||||||||||||||||
Research and development |
|
|
|
|
||||||||||||
Selling, general and administrative |
|
|
|
|
||||||||||||
Total operating expenses |
|
|
|
|
||||||||||||
Income (loss) from operations |
|
( |
) | |
( |
) | ||||||||||
Interest income and other income (expense), net |
|
|
|
|
||||||||||||
Income (loss) before provision for income taxes |
|
( |
) | |
( |
) | ||||||||||
Provision for income taxes |
|
|
|
|
||||||||||||
Net income (loss) |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | ||||||
Net income (loss) per share: |
||||||||||||||||
Basic |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | ||||||
Diluted |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | ||||||
Weighted average common shares outstanding: |
||||||||||||||||
Basic |
|
|
|
|
||||||||||||
Diluted |
|
|
|
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
(Unaudited) |
||||||||||||||||
(In thousands) |
||||||||||||||||
Net income (loss) |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | ||||||
Other comprehensive income (loss), before tax: |
||||||||||||||||
Change in unrealized net gain on available-for-sale investments |
|
|
|
|
||||||||||||
Foreign currency translation gains (losses) |
|
( |
) | ( |
) | |
||||||||||
Other comprehensive income (loss), before tax |
|
( |
) | ( |
) | |
||||||||||
Income taxes related to items in other comprehensive income (loss) |
|
|
|
|
||||||||||||
Other comprehensive income (loss), net of tax |
|
( |
) | ( |
) | |
||||||||||
Comprehensive income (loss) |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | ||||||
Six months ended |
||||||||
June 27, 2020 |
June 29, 2019 |
|||||||
(Unaudited) |
||||||||
(In thousands) |
||||||||
Operating activities |
||||||||
Net income (loss) |
$ | |
$ | ( |
) | |||
Adjustments to reconcile the net income (loss) to net cash and cash equivalents provided by operating activities: |
||||||||
Depreciation and amortization |
|
|
||||||
Net amortization (accretion) of investment premiums and discounts |
( |
) | ( |
) | ||||
Equity-based compensation |
|
|
||||||
Straight-line rent adjustment and amortization of lease incentives |
( |
) | ( |
) | ||||
Change in the fair value of acquisition-related contingent consideration |
|
|
||||||
Deferred income taxes |
|
|
||||||
Loss on disposal of fixed assets |
|
|
||||||
Changes in operating assets and liabilities |
( |
) | |
|||||
Total adjustments |
|
|
||||||
Net cash and cash equivalents provided by operating activities |
|
|
||||||
Investing activities |
||||||||
Purchases of investments |
( |
) | ( |
) | ||||
Proceeds from sales and maturities of investments |
|
|
||||||
Purchases of leasehold improvements and equipment |
( |
) | ( |
) | ||||
Net cash and cash equivalents provided by investing activities |
|
|
||||||
Financing activities |
||||||||
Net proceeds from issuance of common stock |
|
|
||||||
Common stock repurchases |
( |
) | ( |
) | ||||
Taxes paid related to net share settlement |
( |
) | ( |
) | ||||
Payment of acquisition-related contingent consideration |
|
( |
) | |||||
Net cash and cash equivalents provided by financing activities |
|
|
||||||
Effect of exchange rate changes on cash and cash equivalents |
( |
) | |
|||||
Net increase in cash, cash equivalents and restricted cash |
|
|
||||||
Cash, cash equivalents and restricted cash at beginning of period |
|
|
||||||
Cash, cash equivalents and restricted cash at end of period |
$ | |
$ | |
||||
Non-cash investing and financing activity |
||||||||
Additions to right-of-use-assets obtained from new operating lease liabilities |
$ | |
$ | |
||||
1. |
Description of Business, Basis of Presentation and Significant Accounting Policy |
2. |
Revenue |
TFE |
Three Months Ended June 27, 2020 |
Three Months Ended June 29, 2019 |
||||||||||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||||||||||
HDD |
DCP |
PV |
Total |
HDD |
DCP |
PV |
Total |
|||||||||||||||||||||||||
Systems, upgrades |
$ | |
$ | — |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||||||
Field service |
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Total TFE net revenues |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||||||
Six Months Ended June 27, 2020 |
Six Months Ended June 29, 2019 |
|||||||||||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||||||||||
HDD |
DCP |
PV |
Total |
HDD |
DCP |
PV |
Total |
|||||||||||||||||||||||||
Systems, upgrades and spare parts |
$ | |
$ | — |
$ | |
$ | |
$ | |
$ | — |
$ | |
$ | |
||||||||||||||||
Field service |
|
— |
|
|
|
|
— |
|
||||||||||||||||||||||||
Total TFE net revenues |
$ | |
$ | — |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
Three Months Ended |
Six Months Ended |
|||||||||||||||
Photonics |
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
||||||||||||
(In thousands) |
||||||||||||||||
Products: |
||||||||||||||||
Military products |
$ | |
$ | |
$ | |
$ | |
||||||||
Commercial products |
|
|
|
|
||||||||||||
Repair and other services |
|
|
|
|
||||||||||||
Total Photonics product net revenues |
|
|
|
|
||||||||||||
Technology development: |
||||||||||||||||
Firm Fixed Price (“FFP”) |
|
|
|
|
||||||||||||
Cost Plus Fixed Fee (“CPFF”) |
|
|
|
|
||||||||||||
Time and materials |
|
|
|
|
||||||||||||
Total technology development net revenues |
|
|
|
|
||||||||||||
Total Photonics net revenues |
$ | |
$ | |
$ | |
$ | |
||||||||
Three Months Ended |
Three Months Ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
United States |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Asia |
|
— |
|
|
|
|
||||||||||||||||||
Europe |
— |
|
|
— |
|
|
||||||||||||||||||
Total net revenues |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Six Months Ended |
Six Months Ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
United States |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Asia |
|
— |
|
|
|
|
||||||||||||||||||
Europe |
— |
|
|
— |
|
|
||||||||||||||||||
Total net revenues |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Three Months Ended |
Three Months Ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
Products transferred at a point in time |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Products and services transferred over time |
— |
|
|
— |
|
|
||||||||||||||||||
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
Six Months Ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
Products transferred at a point in time |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Products and services transferred over time |
— |
|
|
— |
|
|
||||||||||||||||||
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
June 27, 2020 |
December 28, 2019 |
Six Months Change |
||||||||||
(In thousands) |
||||||||||||
TFE: |
||||||||||||
Contract assets: |
||||||||||||
Accounts receivable, unbilled |
$ | |
$ | |
$ | ( |
) | |||||
Contract liabilities: |
||||||||||||
Deferred revenue |
$ | |
$ | |
$ | |
||||||
Customer advances |
|
|
( |
) | ||||||||
$ | |
$ | |
$ | ( |
) | ||||||
Photonics: |
||||||||||||
Contract assets: |
||||||||||||
Accounts receivable, unbilled |
$ | |
$ | |
$ | ( |
) | |||||
Retainage |
|
|
|
|||||||||
$ | |
$ | |
$ | ( |
) | ||||||
Contract liabilities: |
||||||||||||
Deferred revenue |
$ | |
$ | — |
$ | |
||||||
3. |
Inventories |
June 27, 2020 |
December 28, 2019 |
|||||||
(In thousands) |
||||||||
Raw materials |
$ | |
$ | |
||||
Work-in-progress |
|
|
||||||
Finished goods |
|
|
||||||
$ | |
$ | |
|||||
4. |
Equity-Based Compensation |
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
(In thousands) |
||||||||||||||||
Equity-based compensation by type of award: |
||||||||||||||||
Stock options |
$ | |
$ | |
$ | |
$ | |
||||||||
RSUs |
|
|
|
|
||||||||||||
Employee stock purchase plan |
|
|
|
|
||||||||||||
Total equity-based compensation |
$ | |
$ | |
$ | |
$ | |
||||||||
Shares |
Weighted-Average Exercise Price |
|||||||
Options outstanding at December 28, 2019 |
|
$ | |
|||||
Options granted |
|
$ | |
|||||
Options cancelled and forfeited |
( |
) | $ | |
||||
Options exercised |
( |
) | $ | |
||||
Options outstanding at June 27, 2020 |
|
$ | |
|||||
Options exercisable at June 27, 2020 |
|
$ | |
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
Stock Options: |
||||||||||||||||
Weighted-average fair value of grants per share |
|
$ | |
$ | |
$ | |
|||||||||
Expected volatility |
|
|
% | |
% | |
% | |||||||||
Risk-free interest rate |
|
|
% | |
% | |
% | |||||||||
Expected term of options (in years) |
— |
|
|
|
||||||||||||
Dividend yield |
|
|
|
|
Six Months Ended |
||||||||
June 27, 2020 |
June 29, 2019 |
|||||||
ESPP Purchase Rights: |
||||||||
Weighted-average fair value of grants per share |
$ | |
$ | |
||||
Expected volatility |
|
% | |
% | ||||
Risk-free interest rate |
|
% | |
% | ||||
Expected term of purchase rights (in years) |
|
|
||||||
Dividend yield |
|
|
Three Months Ended |
||||
June 29, 2019 |
||||
Weighted-average fair value of grants per share |
$ | |
||
Expected volatility |
|
% | ||
Risk-free interest rate |
|
% | ||
Expected term (in years) |
|
|||
Dividend yield |
|
Shares |
Weighted - Average Grant Date Fair Value |
|||||||
Non-vested RSUs at December 28, 2019 |
|
$ | |
|||||
Granted |
|
$ | |
|||||
Vested |
( |
) | $ | |
||||
Cancelled and forfeited |
( |
) | $ | |
||||
Non-vested RSUs at June 27, 2020 |
|
$ | |
|||||
Three Months Ended |
||||
June 27, 2020 |
||||
Weighted-average fair value of grants per share |
$ | |
||
Expected volatility |
|
% | ||
Risk-free interest rate |
|
% | ||
Dividend yield |
|
5. |
Purchased Intangible Assets |
June 27, 2020 |
||||||||||||
Gross Carrying Amount |
Accumulated Amortization |
Net Carrying Amount |
||||||||||
(In thousands) |
||||||||||||
TFE |
$ | |
$ | ( |
) | $ | |
|||||
Photonics |
|
( |
) | |
||||||||
$ | |
$ | ( |
) | $ | |
||||||
(In thousands) |
||||
2020 |
$ | |
||
6. |
Acquisition-Related Contingent Consideration |
Three Months End |
Six Months End |
|||||||
June 29, 2019 |
June 29, 2019 |
|||||||
(In thousands) |
||||||||
Opening balance |
$ | |
$ | |
||||
Changes in fair value |
|
|
||||||
Cash payments made |
( |
) | ( |
) | ||||
Closing balance |
$ | |
$ | |
||||
7. |
Warranty |
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
(In thousands) |
||||||||||||||||
Opening balance |
$ | |
$ | |
$ | |
$ | |
||||||||
Expenditures incurred under warranties |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Accruals for product warranties issued during the reporting period |
|
|
|
|
||||||||||||
Adjustments to previously existing warranty accruals |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Closing balance |
$ | |
$ | |
$ | |
$ | |
||||||||
June 27, |
December 28, |
|||||||
2020 |
2019 |
|||||||
(In thousands) |
||||||||
Other accrued liabilities |
$ | |
$ | |
||||
Other long-term liabilities |
|
|
||||||
Total warranty provision |
$ | |
$ | |
||||
8. |
Guarantees |
9. |
Cash, Cash Equivalents and Investments |
June 27, 2020 |
||||||||||||||||
Amortized Cost |
Unrealized Holding Gains |
Unrealized Holding Losses |
Fair Value |
|||||||||||||
(In thousands) |
||||||||||||||||
Cash and cash equivalents: |
||||||||||||||||
Cash |
$ | |
$ | — |
$ | — |
$ | |
||||||||
Money market funds |
|
— |
— |
|
||||||||||||
Total cash and cash equivalents |
$ | |
$ | — |
$ | — |
$ | |
||||||||
Short-term investments: |
||||||||||||||||
Certificates of deposit |
$ | |
$ | |
$ | |
$ | |
||||||||
Commercial paper |
|
|
— |
|
||||||||||||
Corporate bonds and medium-term notes |
|
|
|
|
||||||||||||
U.S. treasury and agency securities |
|
|
— |
|
||||||||||||
Total short-term investments |
$ | |
$ | |
$ | |
$ | |
||||||||
Long-term investments: |
||||||||||||||||
Certificates of deposit |
$ | |
$ | — |
$ | — |
$ | |
||||||||
Corporate bonds and medium-term notes |
|
|
— |
|
||||||||||||
U.S. treasury and agency securities |
|
|
— |
|
||||||||||||
Total long-term investments |
$ | |
$ | |
$ | — |
$ | |
||||||||
Total cash, cash equivalents, and investments |
$ | |
$ | |
$ | |
$ | |
||||||||
December 28, 2019 |
||||||||||||||||
Amortized Cost |
Unrealized Holding Gains |
Unrealized Holding Losses |
Fair Value |
|||||||||||||
(in thousands) |
||||||||||||||||
Cash and cash equivalents: |
||||||||||||||||
Cash |
$ | |
$ | — |
$ | — |
$ | |
||||||||
Money market funds |
|
— |
— |
|
||||||||||||
Total cash and cash equivalents |
$ | |
$ | — |
$ | — |
$ | |
||||||||
Short-term investments: |
||||||||||||||||
Certificates of deposit |
$ | |
$ | |
$ | |
$ | |
||||||||
Commercial paper |
|
|
|
|
||||||||||||
Corporate bonds and medium-term notes |
|
|
|
|
||||||||||||
U.S. treasury and agency securities |
|
|
— |
|
||||||||||||
Total short-term investments |
$ | |
$ | |
$ | |
$ | |
||||||||
Long-term investments: |
||||||||||||||||
Certificates of deposit |
$ | |
$ | |
$ | |
$ | |
||||||||
Corporate bonds and medium-term notes |
|
|
|
|
||||||||||||
U.S. treasury and agency securities |
|
|
|
|
||||||||||||
Total long-term investments |
$ | |
$ | |
$ | |
$ | |
||||||||
Total cash, cash equivalents, and investments |
$ | |
$ | |
$ | |
$ | |
||||||||
Amortized Cost |
Fair Value |
|||||||
(In thousands) |
||||||||
Due in one year or less |
$ | |
$ | |
||||
Due after one through five years |
|
|
||||||
$ | |
$ | |
|||||
June 27, 2020 |
||||||||||||||||
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) |
||||||||||||||||
Certificates of deposit |
$ | |
$ | |
$ | |
$ | |
||||||||
Corporate bonds and medium-term notes |
|
|
|
|
||||||||||||
$ | |
$ | |
$ | |
$ | |
|||||||||
Fair Value Measurements at June 27, 2020 |
||||||||||||
Total |
Level 1 |
Level 2 |
||||||||||
(In thousands) |
||||||||||||
Recurring fair value measurements: |
||||||||||||
Available-for-sale securities |
||||||||||||
Money market funds |
$ | |
$ | |
$ | — |
||||||
U.S. treasury and agency securities |
|
|
— |
|||||||||
Certificates of deposit |
|
— |
|
|||||||||
Commercial paper |
|
— |
|
|||||||||
Corporate bonds and medium-term notes |
|
— |
|
|||||||||
Total recurring fair value measurements |
$ | |
$ | |
$ | |
||||||
10. |
Derivative Instruments |
Notional Amounts |
Derivative Liabilities |
|||||||||||||||||||||||
Derivative Instrument |
June 27, 2020 |
December 28, 2019 |
June 27, 2020 |
December 28, 2019 |
||||||||||||||||||||
Balance Sheet Line |
Fair Value |
Balance Sheet Line |
Fair Value |
|||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Undesignated Hedges: |
||||||||||||||||||||||||
Forward Foreign Currency Contracts |
$ | |
$ | |
* |
$ | |
* |
$ | |
||||||||||||||
Total Hedges |
$ | |
$ | |
$ | |
$ | |
||||||||||||||||
* | Other accrued liabilities |
11. |
Equity |
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
(In thousands, except per share amounts) |
||||||||||||||||
Shares of common stock repurchased |
|
|
|
|
||||||||||||
Cost of stock repurchased |
$ | |
$ | |
$ | |
$ | |
||||||||
Average price paid per share |
$ | |
$ | |
$ | |
$ | |
Three months ended June 27, 2020 |
||||||||||||||||||||
Common Stock and Additional Paid-in Capital |
Treasury Stock |
Accumulated Other Comprehensive Income |
Accumulated Deficit |
Total Stockholders’ Equity |
||||||||||||||||
Balance at March 28, 2020 |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | $ | |
||||||||
Common stock issued under employee plans |
|
— |
— |
— |
|
|||||||||||||||
Shares withheld for net share settlement of RSUs |
( |
) | — |
— |
— |
( |
) | |||||||||||||
Equity-based compensation expense |
|
— |
— |
— |
|
|||||||||||||||
Net income |
— |
— |
— |
|
|
|||||||||||||||
Other comprehensive income |
— |
— |
|
— |
|
|||||||||||||||
Balance at June 27, 2020 |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | $ | |
||||||||
Six months ended June 27, 2020 |
||||||||||||||||||||
Common Stock and Additional Paid-in Capital |
Treasury Stock |
Accumulated Other Comprehensive Income |
Accumulated Deficit |
Total Stockholders’ Equity |
||||||||||||||||
Balance at December 28, 2019 |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | $ | |
||||||||
Common stock issued under employee plans |
|
— |
— |
— |
|
|||||||||||||||
Shares withheld for net share settlement of RSUs |
( |
) | — |
— |
— |
( |
) | |||||||||||||
Equity-based compensation expense |
|
— |
— |
— |
|
|||||||||||||||
Net income |
— |
— |
— |
|
|
|||||||||||||||
Other comprehensive loss |
— |
— |
( |
) | — |
( |
) | |||||||||||||
Common stock repurchases |
— |
( |
) | — |
— |
( |
) | |||||||||||||
Balance at June 27, 2020 |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | $ | |
||||||||
Three months ended June 29, 2019 |
||||||||||||||||||||
Common Stock and Additional Paid-in Capital |
Treasury Stock |
Accumulated Other Comprehensive Income |
Accumulated Deficit |
Total Stockholders’ Equity |
||||||||||||||||
Balance at March 30, 2019 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
Shares withheld for net share settlement of RSUs |
( |
) | — |
— |
— |
( |
) | |||||||||||||
Equity-based compensation expense |
— |
— |
— |
|||||||||||||||||
Net loss |
— |
— |
— |
( |
) | ( |
) | |||||||||||||
Other comprehensive loss |
— |
— |
( |
) | — |
( |
) | |||||||||||||
Common stock repurchases |
— |
( |
) | — |
— |
( |
) | |||||||||||||
Balance at June 29, 2019 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
Six months ended June 29, 2019 |
||||||||||||||||||||
Common Stock and Additional Paid-in Capital |
Treasury Stock |
Accumulated Other Comprehensive Income |
Accumulated Deficit |
Total Stockholders’ Equity |
||||||||||||||||
Balance at December 29, 2018 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
Common stock issued under employee plans |
— |
— |
— |
|||||||||||||||||
Shares withheld for net share settlement of RSUs |
( |
) | — |
— |
— |
( |
) | |||||||||||||
Equity-based compensation expense |
— |
— |
— |
|||||||||||||||||
Net loss |
— |
— |
— |
( |
) | ( |
) | |||||||||||||
Other comprehensive income |
— |
— |
— |
|||||||||||||||||
Common stock repurchases |
— |
( |
) | — |
— |
( |
) | |||||||||||||
Balance at June 29, 2019 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||
June 27, 2020 |
||||||||||||||||||||||||
Foreign currency |
Unrealized holding gain ons available-for-sale investments |
Total |
Foreign currency |
Unrealized holding gains onavailable-for-sale investments |
Total |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Beginning balance |
$ | $ | $ | $ | $ | $ | ||||||||||||||||||
Other comprehensive income (loss) before reclassification |
( |
) | ( |
) | ||||||||||||||||||||
Amounts reclassified from other comprehensive income |
— |
— |
— |
— |
— |
— |
||||||||||||||||||
Net current-period other comprehensive income (loss) |
( |
) | ( |
) | ||||||||||||||||||||
Ending balance |
$ | $ | $ | $ | $ | $ | ||||||||||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||
June 29, 2019 |
||||||||||||||||||||||||
Foreign currency |
Unrealized holding gains on available-for-sale investments |
Total |
Foreign currency |
Unrealized holding gains (losses) on available-for-sale investments |
Total |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Beginning balance |
$ | $ | $ | $ | $ | ( |
) | $ | ||||||||||||||||
Other comprehensive income (loss) before reclassification |
( |
) | ( |
) | ||||||||||||||||||||
Amounts reclassified from other comprehensive income |
— |
— |
— |
— |
— |
— |
||||||||||||||||||
Net current-period other comprehensive income (loss) |
( |
) | ( |
) | ||||||||||||||||||||
Ending balance |
$ | $ | $ | $ | $ | $ | ||||||||||||||||||
12. |
Net Income (Loss) Per Share |
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
(In thousands, except per share amounts) |
||||||||||||||||
Net income (loss) |
$ | $ | ( |
) | $ | $ | ( |
) | ||||||||
Weighted-average shares – basic |
||||||||||||||||
Effect of dilutive potential common shares |
||||||||||||||||
Weighted-average shares – diluted |
||||||||||||||||
Net income (loss) per share – basic |
$ | $ | ( |
) | $ | $ | ( |
) | ||||||||
Net income (loss) per share –diluted |
$ | $ | ( |
) | $ | $ | ( |
) | ||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
(In thousands) |
||||||||||||||||
Stock options to purchase common stock |
||||||||||||||||
RSUs |
||||||||||||||||
Employee stock purchase plan |
13. |
Segment Reporting |
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
(In thousands) |
||||||||||||||||
TFE |
$ | |
$ | |
$ | |
$ | |
||||||||
Photonics |
|
|
|
|
||||||||||||
Total segment net revenues |
$ | |
$ | |
$ | |
$ | |
||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 27, 2020 |
June 29, 2019 |
June 27, 2020 |
June 29, 2019 |
|||||||||||||
(In thousands) |
||||||||||||||||
TFE |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
Photonics |
|
|
|
|
||||||||||||
Total income (loss) from segment operations |
|
|
|
( |
) | |||||||||||
Unallocated costs |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Income (loss) from operations |
|
( |
) | |
( |
) | ||||||||||
Interest income and other income (expense), net |
|
|
|
|
||||||||||||
Income (loss) before provision for income taxes |
$ | |
$ | ( |
) | $ | |
$ | ( |
) | ||||||
June 27, 2020 |
December 28, 2019 |
|||||||
(In thousands) |
||||||||
TFE |
$ | |
$ | |
||||
Photonics |
|
|
||||||
Total segment assets |
|
|
||||||
Cash, cash equivalents and investments |
|
|
||||||
Restricted cash |
|
|
||||||
Deferred income taxes |
|
|
||||||
Other current assets |
|
|
||||||
Common property, plant and equipment |
|
|
||||||
Common operating lease right-of-use assets |
|
|
||||||
Other assets |
|
|
||||||
Consolidated total assets |
$ | |
$ | |
||||
14. |
Income Taxes |
15. |
Contingencies |
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Three months ended |
Six months ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
Change over prior period |
June 27, 2020 |
June 29, 2019 |
Change over prior period |
|||||||||||||||||||
(In thousands, except percentages and per share amounts) |
||||||||||||||||||||||||
Net revenues |
$ | 28,842 | $ | 22,314 | $ | 6,528 | $ | 47,682 | $ | 47,141 | $ | 541 | ||||||||||||
Gross profit |
$ | 11,420 | $ | 8,357 | $ | 3,063 | $ | 19,577 | $ | 15,597 | $ | 3,980 | ||||||||||||
Gross margin percent |
39.6 | % | 37.5 | % | 2.1 points | 41.1 | % | 33.1 | % | 8.0 points | ||||||||||||||
Income (loss) from operations |
$ | 2,104 | $ | (928 | ) | $ | 3,032 | $ | 1,005 | $ | (2,925 | ) | $ | 3,930 | ||||||||||
Net income (loss) |
$ | 1,524 | $ | (1,182 | ) | $ | 2,706 | $ | 300 | $ | (3,574 | ) | $ | 3,874 | ||||||||||
Net income (loss) per diluted share |
$ | 0.06 | $ | (0.05 | ) | $ | 0.11 | $ | 0.01 | $ | (0.16 | ) | $ | 0.17 |
Three months ended |
Six months ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
Change over prior period |
June 27, 2020 |
June 29, 2019 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
$ | 16,595 | $ | 13,264 | $ | 3,331 | $ | 24,557 | $ | 32,209 | $ | (7,652 | ) | |||||||||||
Photonics: |
||||||||||||||||||||||||
Products |
6,130 | 3,973 | 2,157 | 12,004 | 6,665 | 5,339 | ||||||||||||||||||
Contract R&D |
6,117 | 5,077 | 1,040 | 11,121 | 8,267 | 2,854 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
12,247 |
9,050 |
3,197 |
23,125 |
14,932 |
8,193 |
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net revenues |
$ | 28,842 | $ | 22,314 | $ | 6,528 | $ | 47,682 | $ | 47,141 | $ | 541 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
June 27, 2020 |
December 28, 2019 |
June 29, 2019 |
||||||||||
(In thousands) |
||||||||||||
TFE |
$ | 14,567 | $ | 21,391 | $ | 50,251 | ||||||
Photonics |
54,424 | 71,015 | 43,403 | |||||||||
|
|
|
|
|
|
|||||||
Total backlog |
$ | 68,991 | $ | 92,406 | $ | 93,654 | ||||||
|
|
|
|
|
|
Three Months Ended |
Three Months Ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
United States |
$ | 313 | $ | 12,125 | $ | 12,438 | $ | 356 | $ | 8,811 | $ | 9,167 | ||||||||||||
Asia |
16,282 | — | 16,282 | 12,908 | — | 12,908 | ||||||||||||||||||
Europe |
— | 122 | 122 | — | 239 | 239 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net revenues |
$ | 16,595 | $ | 12,247 | $ | 28,842 | $ | 13,264 | $ | 9,050 | $ | 22,314 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
Six Months Ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
United States |
$ | 832 |
$ | 22,981 |
$ | 23,813 |
$ | 517 |
$ | 14,527 |
$ | 15,044 |
||||||||||||
Asia |
23,725 |
— |
23,725 |
31,692 |
— |
31,692 |
||||||||||||||||||
Europe |
— |
144 |
144 |
— |
405 |
405 |
||||||||||||||||||
Total net revenues |
$ | 24,557 |
$ | 23,125 |
$ | 47,682 |
$ | 32,209 |
$ | 14,932 |
$ | 47,141 |
||||||||||||
Three months ended |
Six months ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
Change over prior period |
June 27, 2020 |
June 29, 2019 |
Change over prior period |
|||||||||||||||||||
(In thousands, except percentages) |
||||||||||||||||||||||||
TFE gross profit |
$ | 6,047 |
$ | 5,156 |
$ | 891 |
$ | 9,547 |
$ | 11,134 |
$ | (1,587 |
) | |||||||||||
% of TFE net revenues |
36.4 |
% | 38.9 |
% | 38.9 |
% | 34.6 |
% | ||||||||||||||||
Photonics gross profit |
$ | 5,373 |
$ | 3,201 |
$ | 2,172 |
$ | 10,030 |
$ | 4,463 |
$ | 5,567 |
||||||||||||
% of Photonics net revenues |
43.9 |
% | 35.4 |
% | 43.4 |
% | 29.9 |
% | ||||||||||||||||
Total gross profit |
$ | 11,420 |
$ | 8,357 |
$ | 3,063 |
$ | 19,577 |
$ | 15,597 |
$ | 3,980 |
||||||||||||
% of net revenues |
39.6 |
% | 37.5 |
% | 41.1 |
% | 33.1 |
% |
Three months ended |
Six months ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
Change over prior period |
June 27, 2020 |
June 29, 2019 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Research and development expense |
$ | 3,707 |
$ | 3,431 |
$ | 276 |
$ | 6,991 |
$ | 7,417 |
$ | (426 |
) |
Three months ended |
Six months ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
Change over prior period |
June 27, 2020 |
June 29, 2019 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Selling, general and administrative expense |
$ | 5,609 |
$ | 5,854 |
$ | (245 |
) | $ | 11,581 |
$ | 11,105 |
$ | 476 |
Three months ended |
Six months ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
Change over prior period |
June 27, 2020 |
June 29, 2019 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Interest income and other, income (expense), net |
$ | 62 |
$ | 163 |
$ | (101 |
) | $ | 204 |
$ | 322 |
$ | (118 |
) |
Three months ended |
Six months ended |
|||||||||||||||||||||||
June 27, 2020 |
June 29, 2019 |
Change over prior period |
June 27, 2020 |
June 29, 2019 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Provision for income taxes |
$ | 642 |
$ | 417 |
$ | 225 |
$ | 909 |
$ | 971 |
$ | (62 |
) |
June 27, 2020 |
December 28, 2019 |
|||||||
(In thousands) |
||||||||
Cash and cash equivalents |
$ | 23,944 |
$ | 19,767 |
||||
Restricted cash |
787 |
787 |
||||||
Short-term investments |
14,435 |
16,720 |
||||||
Long-term investments |
5,604 |
5,537 |
||||||
Total cash, cash equivalents, restricted cash and investments |
$ | 44,770 |
$ | 42,811 |
||||
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk |
Item 4. |
Controls and Procedures |
Item 1. |
Legal Proceedings |
Item 1A. |
Risk Factors |
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds |
Item 3. |
Defaults upon Senior Securities |
Item 4. |
Mine Safety Disclosures |
Item 5. |
Other Information |
Item 6. |
Exhibits |
* | Previously filed as an exhibit to the Registrant’s Definitive Proxy Statement filed April 6, 2020. |
** | Previously filed as an exhibit to the Registrant’s Registration Statement on Form S-8 filed May 14, 2020. |
*** | The certification attached as Exhibit 32.1 is deemed “furnished” and not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 and is not to be incorporated by reference into any filing of Intevac, Inc. under the Securities Exchange Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof, irrespective of any general incorporation by reference language contained in any such filing, except to the extent that the registrant specifically incorporates it by reference. |
INTEVAC, INC. | ||||||
Date: July 28, 2020 |
By: |
/s/ WENDELL BLONIGAN | ||||
Wendell Blonigan | ||||||
President and Chief Executive Officer | ||||||
(Principal Executive Officer) |
Date: July 28, 2020 |
By: |
/s/ JAMES MONIZ | ||||
James Moniz | ||||||
Executive Vice President, Finance and Administration, | ||||||
Chief Financial Officer, Secretary and Treasurer | ||||||
(Principal Financial and Accounting Officer) |