Derivative Financial Instruments

6 Months Ended

Jun. 28, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments

We operate and sell our products in various global markets. As a result, we are exposed to changes in foreign currency exchange rates. We utilize foreign currency forward contracts to hedge against future movements in foreign exchange rates that affect certain existing foreign currency denominated assets and liabilities. Under this program, our strategy is to have increases or decreases in our foreign currency exposures offset by gains or losses on the foreign currency forward contracts to mitigate the risks and volatility associated with foreign currency transaction gains or losses. We do not use derivative financial instruments for speculative or trading purposes. Our derivative instruments are not designated as hedging instruments. We record the fair value of these contracts as of the end of our reporting period to our Condensed Consolidated Balance Sheet with changes in fair value recorded within “Other income, net” in our Condensed Consolidated Statement of Operations for both realized and unrealized gains and losses.

The following table provides information about our foreign currency forward contracts outstanding as of June 28, 2014 (in thousands): 

Currency	Contract Position	Contract Amount (Local Currency)		Contract Amount (U.S. Dollars)
Japanese Yen	Sell	1,013,703		$	9,987
Taiwan Dollar	Buy	(23,963	)	(805		)
Korean Won	Buy	1,155,279		(1,143		)
Total USD notional amount of outstanding foreign exchange contracts				$	8,039

The contracts were entered into on June 27, 2014 and matured on July 25, 2014. Our foreign currency contracts are classified within Level 2 of the fair value hierarchy as they are valued using pricing models that utilize observable market inputs. There was no change in the value of these contracts as of June 28, 2014. Additionally, no gains or losses relating to the outstanding derivative contracts were recorded in the three and six months endedJune 28, 2014.

The location and amount of gains and losses related to non-designated derivative instruments that matured in the three and six months endedJune 28, 2014 and June 29, 2013 in the Condensed Consolidated Statement of Operations are as follows (in thousands):

		Amount of Loss Recognized on Derivatives
		Three Months Ended						Six Months Ended
Derivatives Not Designated as Hedging Instruments	Location of Loss Recognized on Derivatives	June 28, 2014			June 29, 2013				June 28, 2014			June 29, 2013
Foreign exchange forward contracts	Other income (expense), net	$	(101	)	$	(23	)		$	(275	)	$	(251	)