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 |
|||||
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 | 22 | ||||
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk | 30 | ||||
Item 4. |
Controls and Procedures | 30 | ||||
Item 1. |
Legal Proceedings | 31 | ||||
Item 1A. |
Risk Factors | 31 | ||||
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds | 37 | ||||
Item 3. |
Defaults upon Senior Securities | 37 | ||||
Item 4. |
Mine Safety Disclosures | 37 | ||||
Item 5. |
Other Information | 38 | ||||
Item 6. |
Exhibits | 38 | ||||
39 |
Item 1. |
Financial Statements |
October 2, 2021 |
January 2, 2021 |
|||||||
(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 |
||||||||
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 |
||||||||
|
|
|
|
|||||
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 |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
(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 loss |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
|
|
|
|
|
|
|
|
|||||||||
Net loss per share: |
||||||||||||||||
Basic and Diluted |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
Weighted average common shares outstanding: |
||||||||||||||||
Basic and Diluted |
Three Months Ended |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
(Unaudited) (In thousands) |
||||||||||||||||
Net loss |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
|
|
|
|
|
|
|
|
|||||||||
Other comprehensive income (loss), before tax |
||||||||||||||||
Change in unrealized net gain on available-for-sale |
( |
) | ( |
) | ( |
) | ||||||||||
Foreign currency translation gains (losses) |
( |
) | ( |
) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Other comprehensive income (loss), before tax |
( |
) | ( |
) | ||||||||||||
Income tax (expense) benefit related to items in other comprehensive income (loss) |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Other comprehensive income (loss), net of tax |
( |
) | ( |
) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Comprehensive income (loss) |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ||||||
|
|
|
|
|
|
|
|
Nine months ended |
||||||||
October 2, 2021 |
September 26, 2020 |
|||||||
(Unaudited) (In thousands) |
||||||||
Operating activities |
||||||||
Net loss |
$ | ( |
) | $ | ( |
) | ||
Adjustments to reconcile net loss to net cash and cash equivalents provided by (used in) 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 |
( |
) | ( |
) | ||||
Deferred income taxes |
( |
) | ||||||
Changes in operating assets and liabilities |
||||||||
|
|
|
|
|||||
Total adjustments |
||||||||
|
|
|
|
|||||
Net cash and cash equivalents provided by (used in) 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 (used in) investing activities |
( |
) | ||||||
Financing activities |
||||||||
Net proceeds from issuance of common stock |
||||||||
Common stock repurchases |
( |
) | ||||||
Taxes paid related to net share settlement |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Net cash and cash equivalents provided by financing activities |
||||||||
Effect of exchange rate changes on cash |
( |
) | ||||||
|
|
|
|
|||||
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 |
$ | $ | ||||||
|
|
|
|
1. |
Description of Business and Basis of Presentation |
2. |
Revenue |
TFE |
Three Months Ended October 2, 2021 |
Three Months Ended September 26, 2020 |
||||||||||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||||||||||
HDD |
DCP |
PV |
ASP |
Total |
HDD |
PV |
Total |
|||||||||||||||||||||||||
Systems, upgrades and spare parts |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||||||||
Field service |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total TFE net revenues |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended October 2, 2021 |
Nine Months Ended September 26, 2020 |
|||||||||||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||||||||||
HDD |
DCP |
PV |
ASP |
Total |
HDD |
PV |
Total |
|||||||||||||||||||||||||
Systems, upgrades and spare parts |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||||||||
Field service |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total TFE net revenues |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||
Photonics |
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
||||||||||||
(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”) |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total technology development net revenues |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Photonics net revenues |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
Three Months Ended |
Three Months Ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
United States |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||
Asia |
||||||||||||||||||||||||
Europe |
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net revenues |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended |
Nine Months Ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
United States |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||
Asia |
||||||||||||||||||||||||
Europe |
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net revenues |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
Three Months Ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
Products transferred at a point in time |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||
Products and services transferred over time |
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
$ |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended |
Nine Months Ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
Products transferred at a point in time |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||
Products and services transferred over time |
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
$ |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
October 2, 2021 |
January 2, 2021 |
Nine 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 |
October 2, |
January 2, |
|||||||
2021 |
2021 |
|||||||
(In thousands) |
||||||||
Raw materials |
$ | $ | ||||||
Work-in-progress |
||||||||
Finished goods |
||||||||
|
|
|
|
|||||
$ | $ | |||||||
|
|
|
|
4. |
Equity-Based Compensation |
Three Months Ended |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
(In thousands) |
||||||||||||||||
Equity-based compensation by type of award: |
||||||||||||||||
Stock options |
$ | $ | $ | $ | ||||||||||||
RSUs |
||||||||||||||||
ESPP awards |
||||||||||||||||
Total equity-based compensation |
$ | $ | $ | $ | ||||||||||||
Shares |
Weighted-Average Exercise Price |
|||||||
Options outstanding at January 2, 2021 |
$ | |||||||
Options granted |
$ | |||||||
Options cancelled and forfeited |
( |
) | $ | |||||
Options exercised |
( |
) | $ | |||||
Options outstanding at October 2, 2021 |
$ | |||||||
Options exercisable at October 2, 2021 |
$ |
Three Months Ended |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
Stock Options: |
||||||||||||||||
Weighted-average fair value of grants per share |
$ |
$ |
$ |
$ |
||||||||||||
Expected volatility |
% | |||||||||||||||
Risk-free interest rate |
% | |||||||||||||||
Expected term of options (in years) |
||||||||||||||||
Dividend yield |
Three Months Ended |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
Stock 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 |
Shares |
Weighted-Average Grant Date Fair Value |
|||||||
Non-vested RSUs at January 2, 2021 |
$ | |||||||
Granted |
$ | |||||||
Vested |
( |
) | $ | |||||
Cancelled and forfeited |
( |
) | $ | |||||
Non-vested RSUs at October 2, 2021 |
$ | |||||||
Nine Months Ended |
||||
October 2, 2021 |
||||
Weighted-average fair value of grants per share |
$ | |||
Expected volatility |
% | |||
Risk-free interest rate |
% | |||
Dividend yield |
Nine Months Ended |
||||
September 26, 2020 |
||||
Weighted-average fair value of grants per share |
$ | |||
Expected volatility |
% | |||
Risk-free interest rate |
% | |||
Dividend yield |
5. |
Warranty |
Three Months Ended |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
(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 |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
October 2, 2021 |
January 2, 2021 |
|||||||
(In thousands) |
||||||||
Other accrued liabilities |
$ | $ | ||||||
Other long-term liabilities |
||||||||
|
|
|
|
|||||
Total warranty provision |
$ | $ | ||||||
|
|
|
|
6. |
Guarantees |
7. |
Cash, Cash Equivalents and Investments |
October 2, 2021 |
||||||||||||||||
Amortized Cost |
Unrealized Holding Gains |
Unrealized Holding Losses |
Fair Value |
|||||||||||||
(In thousands) |
||||||||||||||||
Cash and cash equivalents: |
||||||||||||||||
Cash |
$ | $ | — | $ | — | $ | ||||||||||
Money market funds |
— | — | ||||||||||||||
Municipal bonds |
— | — | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total cash and cash equivalents |
$ | $ | — | $ | — | $ | ||||||||||
Short-term investments: |
||||||||||||||||
Certificates of deposit |
$ | $ | $ | — | $ | |||||||||||
Commercial paper |
— | — | ||||||||||||||
Corporate bonds and medium-term notes |
— | |||||||||||||||
Municipal bonds |
— | — | ||||||||||||||
U.S. treasury and agency securities |
— | — | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total short-term investments |
$ | $ | $ | — | $ | |||||||||||
Long-term investments: |
||||||||||||||||
Asset backed securities |
$ | $ | — | $ | — | $ | ||||||||||
Certificates of deposit |
— | |||||||||||||||
Corporate bonds and medium-term notes |
||||||||||||||||
Municipal bonds |
— | |||||||||||||||
U.S. treasury and agency securities |
— | — | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total long-term investments |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total cash, cash equivalents, and investments |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
January 2, 2021 |
||||||||||||||||
Amortized Cost |
Unrealized Holding Gains |
Unrealized Holding Losses |
Fair Value |
|||||||||||||
(In thousands) |
||||||||||||||||
Cash and cash equivalents: |
||||||||||||||||
Cash |
$ | $ | — | $ | — | $ | ||||||||||
Money market funds |
— | — | ||||||||||||||
Certificates of deposit |
— | — | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total cash and cash equivalents |
$ | $ | — | $ | — | $ | ||||||||||
Short-term investments: |
||||||||||||||||
Certificates of deposit |
$ | $ | $ | $ | ||||||||||||
Commercial paper |
||||||||||||||||
Corporate bonds and medium-term notes |
||||||||||||||||
Municipal bonds |
— | — | ||||||||||||||
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 |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
October 2, 2021 |
||||||||
Amortized Cost |
Fair Value |
|||||||
(In thousands) |
||||||||
Due in one year or less |
$ | $ | ||||||
Due after one through three years |
||||||||
|
|
|
|
|||||
$ | $ | |||||||
|
|
|
|
October 2, 2021 |
||||||||||||||||
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 |
||||||||||||||||
Municipal bond |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | $ | $ | $ | |||||||||||||
|
|
|
|
|
|
|
|
Fair Value Measurements at October 2, 2021 |
||||||||||||
Total |
Level 1 |
Level 2 |
||||||||||
(In thousands) |
||||||||||||
Recurring fair value measurements: |
||||||||||||
Available-for-sale |
||||||||||||
Money market funds |
$ | $ | $ | — | ||||||||
U.S. treasury and agency securities |
— | |||||||||||
Asset backed securities |
— | |||||||||||
Certificates of deposit |
— | |||||||||||
Commercial paper |
— | |||||||||||
Corporate bonds and medium-term notes |
— | |||||||||||
Municipal bonds |
— | |||||||||||
|
|
|
|
|
|
|||||||
Total recurring fair value measurements |
$ | $ | $ | |||||||||
|
|
|
|
|
|
8. |
Derivative Instruments |
Notional Amounts |
Derivative Liabilities |
|||||||||||||||||||||||
Derivative Instrument |
October 2 2021 |
January 2, 2021 |
October 2, 2021 |
January 2, 2021 |
||||||||||||||||||||
Balance Sheet Line |
Fair Value |
Balance Sheet Line |
Fair Value |
|||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Undesignated Hedges: |
||||||||||||||||||||||||
Forward Foreign Currency Contracts |
$ | $ | (a |
) |
$ | (a |
) |
$ | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Total Hedges |
$ | $ | $ | $ | ||||||||||||||||||||
|
|
|
|
|
|
|
|
(a) | Other accrued liabilities |
9. |
Equity |
Three months ended October 2, 2021 |
||||||||||||||||||||
Common Stock and Additional Paid-in Capital |
Treasury Stock |
Accumulated Other Comprehensive Income |
Accumulated Deficit |
Total Stockholders’ Equity |
||||||||||||||||
Balance at July 3, 2021 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
Common stock issued under employee plans |
— | — | — | |||||||||||||||||
Shares withheld for net share settlement of RSUs |
( |
) | — | — | — | ( |
) | |||||||||||||
Equity-based compensation expense |
— | — | — | |||||||||||||||||
Net loss |
— | — | — | ( |
) | ( |
) | |||||||||||||
Other comprehensive loss |
— | — | ( |
) | — | ( |
) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance at October 2, 2021 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
|
|
|
|
|
|
|
|
|
|
Nine months ended October 2, 2021 |
||||||||||||||||||||
Common Stock and Additional Paid-in Capital |
Treasury Stock |
Accumulated Other Comprehensive Income |
Accumulated Deficit |
Total Stockholders’ Equity |
||||||||||||||||
Balance at January 2, 2021 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
Common stock issued under employee plans |
— | — | — | |||||||||||||||||
Shares withheld for net share settlement of RSUs |
( |
) | — | — | — | ( |
) | |||||||||||||
Equity-based compensation expense |
— | — | — | |||||||||||||||||
Net loss |
— | — | — | ( |
) | ( |
) | |||||||||||||
Other comprehensive loss |
— | — | ( |
) | — | ( |
) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance at October 2, 2021 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
|
|
|
|
|
|
|
|
|
|
Three months ended September 26, 2020 |
||||||||||||||||||||
Common Stock and Additional Paid-in Capital |
Treasury Stock |
Accumulated Other Comprehensive Income |
Accumulated Deficit |
Total Stockholders’ Equity |
||||||||||||||||
Balance at June 27, 2020 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
Common stock issued under employee plans |
— | — | — | |||||||||||||||||
Shares withheld for net share settlement of RSUs |
( |
) | — | — | — | ( |
) | |||||||||||||
Equity-based compensation expense |
— | — | — | |||||||||||||||||
Net loss |
— | — | — | ( |
) | ( |
) | |||||||||||||
Other comprehensive income |
— | — | — | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance at September 26, 2020 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
|
|
|
|
|
|
|
|
|
|
Nine months ended September 26, 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 loss |
— | — | — | ( |
) | ( |
) | |||||||||||||
Other comprehensive income |
— | — | — | |||||||||||||||||
Common stock repurchases |
— | ( |
) | — | — | ( |
) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance at September 26, 2020 |
$ | $ | ( |
) | $ | $ | ( |
) | $ | |||||||||||
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||||||||||
October 2, 2021 |
||||||||||||||||||||||||
Foreign currency |
Unrealized holding gains (losses) on available-for-sale investments |
Total |
Foreign currency |
Unrealized holding gains (losses) on available-for-sale investments |
Total |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Beginning balance |
$ | $ | $ | $ | $ | $ | ||||||||||||||||||
Other comprehensive loss before reclassification |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||
Amounts reclassified from other comprehensive income (loss) |
— | — | — | — | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net current-period other comprehensive loss |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Ending balance |
$ | $ | $ | $ | $ | $ | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||||||||||
September 26, 2020 |
||||||||||||||||||||||||
Foreign currency |
Unrealized holding gains (losses) on available-for-sale investments |
Total |
Foreign currency |
Unrealized holding gains on available-for-sale investments |
Total |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Beginning balance |
$ | $ | $ | $ | $ | $ | ||||||||||||||||||
Other comprehensive income (loss) before reclassification |
( |
) | ||||||||||||||||||||||
Amounts reclassified from other comprehensive income (loss) |
— | — | — | — | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net current-period other comprehensive income |
( |
) | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Ending balance |
$ | $ | $ | $ | $ | $ | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
(In thousands, except per share amounts) |
||||||||||||||||
Shares of common stock repurchased |
||||||||||||||||
Cost of stock repurchased |
$ | $ | $ | $ | ||||||||||||
Average price paid per share |
$ | $ | $ | $ |
10. |
Net Loss Per Share |
Three Months Ended |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
(In thousands, except per share amounts) |
||||||||||||||||
Net loss |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
|
|
|
|
|
|
|
|
|||||||||
Weighted-average shares – basic |
||||||||||||||||
Effect of dilutive potential common shares |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Weighted-average shares – diluted |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net loss per share – basic |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
|
|
|
|
|
|
|
|
|||||||||
Net loss per share –diluted |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
|
|
|
|
|
|
|
|
11. |
Segment Reporting |
Three Months Ended |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
(In thousands) |
||||||||||||||||
TFE |
$ | $ | $ | $ | ||||||||||||
Photonics |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total segment net revenues |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||
October 2, 2021 |
September 26, 2020 |
October 2, 2021 |
September 26, 2020 |
|||||||||||||
(In thousands) |
||||||||||||||||
TFE |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
Photonics |
( |
) | ( |
) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total segment operating income (loss) |
( |
) | ( |
) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Unallocated costs |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from operations |
( |
) | ( |
) | ( |
) | ||||||||||
Interest income and other income (expense), net |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) before provision for income taxes |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ||||||
|
|
|
|
|
|
|
|
October 2, 2021 |
January 2, 2021 |
|||||||
(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 |
||||||||
Other assets |
||||||||
|
|
|
|
|||||
Consolidated total assets |
$ | $ | ||||||
|
|
|
|
12. |
Income Taxes |
13. |
Restructuring Charges |
Three Months Ended October 2, 2021 |
Nine Months Ended October 2, 2021 |
Three and Nine Months Ended September 26, 2020 |
||||||||||
(In thousands) |
||||||||||||
Severance and other employee-related costs |
||||||||||||
Beginning balance |
$ | — | $ | — | $ | — | ||||||
Provision for restructuring reserves |
||||||||||||
Cash payments made |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Ending balance |
$ | — | $ | — | $ | — | ||||||
|
|
|
|
|
|
14. |
Contingencies |
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Three months ended |
Nine months ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
Change over prior period |
October 2, 2021 |
September 26, 2020 |
Change over prior period |
|||||||||||||||||||
(In thousands, except percentages and per share amounts) |
||||||||||||||||||||||||
Net revenues |
$ | 14,793 | $ | 21,565 | $ | (6,772 | ) | $ | 44,847 | $ | 69,248 | $ | (24,401 | ) | ||||||||||
Gross profit |
$ | 5,527 | $ | 9,300 | $ | (3,773 | ) | $ | 11,689 | $ | 28,876 | $ | (17,187 | ) | ||||||||||
Gross margin percent |
37.4 | % | 43.1 | % | (5.7) points | 26.1 | % | 41.7 | % | (15.6)points | ||||||||||||||
Income (loss) from operations |
$ | (3,968 | ) | $ | (148 | ) | $ | (3,820 | ) | $ | (16,781 | ) | $ | 856 | $ | (17,637 | ) | |||||||
Net loss |
$ | (4,233 | ) | $ | (357 | ) | $ | (3,876 | ) | $ | (16,863 | ) | $ | (57 | ) | $ | (16,806 | ) | ||||||
Net loss per diluted share |
$ | (0.17 | ) | $ | (0.02 | ) | $ | (0.15 | ) | $ | (0.69 | ) | $ | (0.00 | ) | $ | (0.69 | ) |
Three months ended |
Nine months ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
Change over prior period |
October 2, 2021 |
September 26, 2020 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
$ | 7,998 | $ | 9,367 | $ | (1,369 | ) | $ | 22,605 | $ | 33,925 | $ | (11,320 | ) | ||||||||||
Photonics: |
||||||||||||||||||||||||
Contract R&D |
3,093 | 6,538 | (3,445 | ) | 9,437 | 17,659 | (8,222 | ) | ||||||||||||||||
Products |
3,702 | 5,660 | (1,958 | ) | 12,805 | 17,664 | (4,859 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
6,795 | 12,198 | (5,403 | ) | 22,242 | 35,323 | (13,081 | ) | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net revenues |
$ | 14,793 | $ | 21,565 | $ | (6,772 | ) | $ | 44,847 | $ | 69,248 | $ | (24,401 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
October 2, 2021 |
January 2, 2021 |
September 26, 2020 |
||||||||||
(In thousands) |
||||||||||||
TFE |
$ | 16,925 | $ | 5,623 | $ | 18,092 | ||||||
Photonics |
27,942 | 41,317 | 45,159 | |||||||||
|
|
|
|
|
|
|||||||
Total backlog |
$ | 44,867 | $ | 46,940 | $ | 63,251 | ||||||
|
|
|
|
|
|
Three Months Ended |
Three Months Ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
United States |
$ |
220 |
$ |
6,738 |
$ |
6,958 |
$ |
1,764 |
$ |
12,079 |
$ |
13,843 |
||||||||||||
Asia |
7,778 |
— |
7,778 |
7,536 |
— |
7,536 |
||||||||||||||||||
Europe |
— |
57 |
57 |
67 |
119 |
186 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net revenues |
$ |
7,998 |
$ |
6,795 |
$ |
14,793 |
$ |
9,367 |
$ |
12,198 |
$ |
21,565 |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended |
Nine Months Ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
|||||||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
TFE |
Photonics |
Total |
TFE |
Photonics |
Total |
|||||||||||||||||||
United States |
$ |
2,708 |
$ |
22,069 |
$ |
24,777 |
$ |
2,596 |
$ |
35,060 |
$ |
37,656 |
||||||||||||
Asia |
16,047 |
— |
16,047 |
31,262 |
— |
31,262 |
||||||||||||||||||
Europe |
3,850 |
173 |
4,023 |
67 |
263 |
330 |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net revenues |
$ |
22,605 |
$ |
22,242 |
$ |
44,847 |
$ |
33,925 |
$ |
35,323 |
$ |
69,248 |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
Nine months ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
Change over prior period |
October 2, 2021 |
September 26, 2020 |
Change over prior period |
|||||||||||||||||||
(In thousands, except percentages) |
||||||||||||||||||||||||
TFE gross profit |
$ | 3,350 | $ | 4,075 | $ | (725 | ) | $ | 6,491 | $ | 13,622 | $ | (7,131 | ) | ||||||||||
% of TFE net revenues |
41.9 | % | 43.5 | % | 28.7 | % | 40.2 | % | ||||||||||||||||
Photonics gross profit |
$ | 2,177 | $ | 5,225 | $ | (3,048 | ) | $ | 5,198 | $ | 15,254 | $ | (10,056 | ) | ||||||||||
% of Photonics net revenues |
32.0 | % | 42.8 | % | 23.4 | % | 43.2 | % | ||||||||||||||||
Total gross profit |
$ | 5,527 | $ | 9,300 | $ | (3,773 | ) | $ | 11,689 | $ | 28,876 | $ | (17,187 | ) | ||||||||||
% of net revenues |
37.4 | % | 43.1 | % | 26.1 | % | 41.7 | % |
Three months ended |
Nine months ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
Change over prior period |
October 2, 2021 |
September 26, 2020 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Research and development expense |
$ | 3,743 | $ | 3,603 | $ | 140 | $ | 11,262 | $ | 10,594 | $ | 668 |
Three months ended |
Nine months ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
Change over prior period |
October 2, 2021 |
September 26, 2020 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Selling, general and administrative expense |
$ | 5,752 | $ | 5,845 | $ | (93 | ) | $ | 17,208 | $ | 17,426 | $ | (218 | ) |
Three months ended |
Nine months ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
Change over prior period |
October 2, 2021 |
September 26, 2020 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Interest income and other income (expense), net |
$ | 25 | $ | 8 | $ | 17 | $ | 75 | $ | 212 | $ | (137 | ) |
Three months ended |
Nine months ended |
|||||||||||||||||||||||
October 2, 2021 |
September 26, 2020 |
Change over prior period |
October 2, 2021 |
September 26, 2020 |
Change over prior period |
|||||||||||||||||||
(In thousands) |
||||||||||||||||||||||||
Provision for income taxes |
$ | 290 | $ | 217 | $ | 73 | $ | 157 | $ | 1,125 | $ | (968 | ) |
October 2, 2021 |
January 2, 2021 |
|||||||
(In thousands) |
||||||||
Cash and cash equivalents |
$ | 33,696 | $ | 29,341 | ||||
Restricted cash |
786 | 787 | ||||||
Short-term investments |
11,137 | 14,839 | ||||||
Long-term investments |
5,825 | 5,388 | ||||||
|
|
|
|
|||||
Total cash, cash equivalents, restricted cash and investments |
$ | 51,444 | $ | 50,355 | ||||
|
|
|
|
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 |
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 and Treasurer 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 | The following financial statements from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 2, 2021, formatted in Inline XBRL (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Comprehensive Income (Loss), (iv) Condensed Consolidated Statements of Cash Flows, and (v) Notes to Condensed Consolidated Financial Statements. | |
104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |
* | 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: November 2, 2021 |
||||||
By: |
/s/ WENDELL BLONIGAN | |||||
Wendell Blonigan | ||||||
President, Chief Executive Officer and Director | ||||||
(Principal Executive Officer) | ||||||
Date: November 2, 2021 |
||||||
By: |
/s/ JAMES MONIZ | |||||
James Moniz | ||||||
Executive Vice President, Finance and Administration, | ||||||
Chief Financial Officer, Secretary and Treasurer | ||||||
(Principal Financial and Accounting Officer) |