Discontinued Operations and Assets Held For Sale

12 Months Ended

Mar. 31, 2013

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations and Assets Held For Sale

Discontinued Operations

On September 26, 2011, the Company completed the transfer of certain assets related to IDT’s Hollywood Quality Video (HQV) and Frame Rate Conversion (FRC) video processing product lines to Qualcomm pursuant to an Asset Purchase Agreement. The sale of these HQV and FRC video processing assets was intended to allow the Company to intensify focus on its analog-intensive mixed-signal, timing, and interface and solutions. Upon the closing of the transaction, Qualcomm paid the Company $58.7 million in cash consideration, of which $6.0 million has been withheld in an escrow account for a period of two years and is included in the Company’s balance sheet as other current assets. The Company’s HQV and FRC product lines represented a significant portion of the Company’s video business assets. In the second quarter of fiscal 2012, the Company recorded a gain of $45.9 million related to this divestiture. The following table summarizes the components of the gain (in thousands):

	Amount
Cash proceeds from sale (including amounts held in escrow)	$	58,744
Less book value of assets sold and direct costs related to the sale:
Fixed assets	(434		)
Goodwill	(8,568		)
Intangible assets	(1,818		)
License	(525		)
Transaction and other costs	(1,460		)
Gain on divestiture	$	45,939

On August 1, 2012, the Company completed the transfer of the remaining assets of its video business to Synaptics for $5.0 million in cash pursuant to an Asset Purchase Agreement. In connection with the divestiture, 47 employees were transferred to Synaptics. In the second quarter of fiscal 2013, the Company recorded a gain of $0.9 million related to this divestiture. The following table summarizes the components of the gain (in thousands):

	Amount
Cash proceeds from sale	$	5,000
Less book value of assets sold and direct costs related to the sale:
Fixed assets	(1,963		)
Goodwill	(700		)
Inventories	(1,288		)
Transaction and other costs	(163		)
Gain on divestiture	$	886

Prior to second quarter of fiscal 2012, the video business was part of the Company’s Computing and Consumer reportable segment. For financial statement purposes, the results of operations for the video business are presented in the Company's consolidated financial statements as discontinued operations.

The results of discontinued operations for the fiscal years 2013, 2012 and 2011 are as follows (in thousands):

	For the Fiscal Year Ended
	March 31, 2013			April 1, 2012			April 3, 2011
Revenues	$	2,429		$	9,620		$	20,316
Cost of revenue	3,006			11,271			16,627
Operating expenses	4,554			23,240			27,949
Gain on divestiture	886			45,939			—
Income tax expense (benefit)	3			(89		)	(85		)
Net income (loss) from discontinued operations	$	(4,248	)	$	21,137		$	(24,175	)