10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2013

OR

o 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 000-22418

ITRON, INC.

(Exact name of registrant as specified in its charter)

Washington	91-1011792
(State of Incorporation)	(I.R.S. Employer Identification Number)

2111 N Molter Road, Liberty Lake, Washington 99019

(509) 924-9900

(Address and telephone number of registrant’s principal executive offices)

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.    Yes  x    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).    Yes  x    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.

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	o  (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 Exchange Act).    Yes  ¨    No  x

As of July 31, 2013 there were outstanding 39,111,850 shares of the registrant’s common stock, no par value, which is the only class of common stock of the registrant.

Itron, Inc.

Table of Contents

	Page
PART I: FINANCIAL INFORMATION
Item 1: Financial Statements (Unaudited)
Consolidated Statements of Operations	1
Consolidated Statements of Comprehensive Income (Loss)	2
Consolidated Balance Sheets	3
Consolidated Statements of Cash Flows	4
Notes to Condensed Consolidated Financial Statements	5
Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations	34
Item 3: Quantitative and Qualitative Disclosures About Market Risk	48
Item 4: Controls and Procedures	49
PART II: OTHER INFORMATION
Item 1: Legal Proceedings	50
Item 1A: Risk Factors	50
Item 2: Unregistered Sales of Equity Securities and Use of Proceeds	50
Item 5: Other Information	50
Item 6: Exhibits	51
SIGNATURE	52

PART I: FINANCIAL INFORMATION

Item 1: Financial Statements (Unaudited)

ITRON, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands, except per share data)
Revenues	$	482,175		$	579,140		$	929,711		$	1,150,780
Cost of revenues	322,587			382,395			630,000			770,930
Gross profit	159,588			196,745			299,711			379,850
Operating expenses
Sales and marketing	46,182			50,847			94,398			100,703
Product development	43,481			46,640			87,689			90,996
General and administrative	38,317			33,450			71,912			70,020
Amortization of intangible assets	10,247			12,025			20,991			23,938
Restructuring expense	3,385			7,720			4,398			8,509
Total operating expenses	141,612			150,682			279,388			294,166
Operating income	17,976			46,063			20,323			85,684
Other income (expense)
Interest income	194			177			1,255			370
Interest expense	(2,336		)	(2,606		)	(4,674		)	(5,043		)
Other income (expense), net	(1,742		)	(779		)	(2,559		)	(2,955		)
Total other income (expense)	(3,884		)	(3,208		)	(5,978		)	(7,628		)
Income before income taxes	14,092			42,855			14,345			78,056
Income tax benefit (provision)	(1,896		)	(10,564		)	1,347			(20,193		)
Net income	12,196			32,291			15,692			57,863
Net income (loss) attributable to noncontrolling interests	(203		)	676			723			895
Net income attributable to Itron, Inc.	$	12,399		$	31,615		$	14,969		$	56,968
Earnings per common share - Basic	$	0.31		$	0.79		$	0.38		$	1.43
Earnings per common share - Diluted	$	0.31		$	0.79		$	0.38		$	1.42
Weighted average common shares outstanding - Basic	39,431			39,887			39,426			39,900
Weighted average common shares outstanding - Diluted	39,678			40,126			39,724			40,170

The accompanying notes are an integral part of these condensed consolidated financial statements.

1

ITRON, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(UNAUDITED)

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Net income	$	12,196		$	32,291		$	15,692		$	57,863
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	7,180			(52,331		)	(24,120		)	(23,790		)
Net unrealized gain (loss) on derivative instruments, designated as cash flow hedges	845			(849		)	772			(849		)
Pension plan benefit liability adjustment	183			22			(197		)	45
Total other comprehensive income (loss), net of tax	8,208			(53,158		)	(23,545		)	(24,594		)
Total comprehensive income (loss), net of tax	20,404			(20,867		)	(7,853		)	33,269
Comprehensive income (loss) attributable to noncontrolling interests, net of tax:
Net income (loss) attributable to noncontrolling interests	(203		)	676			723			895
Foreign currency translation adjustments	5			40			—			40
Amounts attributable to noncontrolling interests	(198		)	716			723			935
Comprehensive income (loss) attributable to Itron, Inc.	$	20,602		$	(21,583	)	$	(8,576	)	$	32,334

The accompanying notes are an integral part of these consolidated financial statements.

2

ITRON, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)

	June 30, 2013			December 31, 2012
	(unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	103,662		$	136,411
Accounts receivable, net	372,240			375,326
Inventories	190,414			170,719
Deferred tax assets current, net	33,138			33,536
Other current assets	112,014			104,958
Total current assets	811,468			820,950
Property, plant, and equipment, net	249,372			255,212
Deferred tax assets noncurrent, net	55,397			44,584
Other long-term assets	26,607			28,908
Intangible assets, net	210,849			238,771
Goodwill	696,215			701,016
Total assets	$	2,049,908		$	2,089,441
LIABILITIES AND EQUITY
Current liabilities
Accounts payable	$	203,092		$	227,739
Other current liabilities	54,988			49,950
Wages and benefits payable	84,831			91,802
Taxes payable	15,481			9,305
Current portion of debt	22,500			18,750
Current portion of warranty	24,709			27,115
Unearned revenue	50,799			42,712
Total current liabilities	456,400			467,373
Long-term debt	387,500			398,750
Long-term warranty	25,923			26,490
Pension plan benefit liability	89,948			90,533
Deferred tax liabilities noncurrent, net	11,235			16,682
Other long-term obligations	81,229			80,100
Total liabilities	1,052,235			1,079,928
Commitments and contingencies
Equity
Preferred stock	—			—
Common stock	1,290,226			1,294,213
Accumulated other comprehensive loss, net	(57,929		)	(34,384		)
Accumulated deficit	(251,893		)	(266,862		)
Total Itron, Inc. shareholders' equity	980,404			992,967
Noncontrolling interests	17,269			16,546
Total equity	997,673			1,009,513
Total liabilities and equity	$	2,049,908		$	2,089,441

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

ITRON, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Six Months Ended June 30,
	2013			2012
	(in thousands)
Operating activities
Net income	$	15,692		$	57,863
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	49,031			54,271
Stock-based compensation	10,122			9,256
Amortization of prepaid debt fees	829			763
Deferred taxes, net	(11,543		)	628
Restructuring expense, non-cash	27			1,487
Other adjustments, net	324			(11		)
Changes in operating assets and liabilities, net of acquisition:
Accounts receivable	(4,278		)	8,046
Inventories	(25,124		)	(2,786		)
Other current assets	(9,408		)	(13,663		)
Other long-term assets	4,489			3,559
Accounts payable, other current liabilities, and taxes payable	(10,280		)	(5,817		)
Wages and benefits payable	(5,661		)	(11,244		)
Unearned revenue	10,497			5,627
Warranty	(1,797		)	(11,991		)
Other operating, net	(3,946		)	(3,598		)
Net cash provided by operating activities	18,974			92,390
Investing activities
Acquisitions of property, plant, and equipment	(28,895		)	(23,547		)
Business acquisitions, net of cash and cash equivalents acquired	(860		)	(79,605		)
Other investing, net	241			3,993
Net cash used in investing activities	(29,514		)	(99,159		)
Financing activities
Proceeds from borrowings	15,000			70,000
Payments on debt	(22,500		)	(67,502		)
Issuance of common stock	2,590			2,407
Repurchase of common stock	(16,126		)	(25,976		)
Other financing, net	2,220			(271		)
Net cash used in financing activities	(18,816		)	(21,342		)
Effect of foreign exchange rate changes on cash and cash equivalents	(3,393		)	(2,175		)
Decrease in cash and cash equivalents	(32,749		)	(30,286		)
Cash and cash equivalents at beginning of period	136,411			133,086
Cash and cash equivalents at end of period	$	103,662		$	102,800
Non-cash transactions:
Property, plant, and equipment purchased but not yet paid	$	7,284		$	4,364
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Income taxes, net	$	8,200		$	20,173
Interest, net of amounts capitalized	3,804			4,275

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

ITRON, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2013

(UNAUDITED)

In this Quarterly Report on Form 10-Q, the terms “we,” “us,” “our,” “Itron,” and the “Company” refer to Itron, Inc.

Note 1:    Summary of Significant Accounting Policies

We were incorporated in the state of Washington in 1977. We provide a portfolio of products and services to utilities for the energy and water markets throughout the world.

Financial Statement Preparation

The condensed consolidated financial statements presented in this Quarterly Report on Form 10-Q are unaudited and reflect entries necessary for the fair presentation of the Consolidated Statements of Operations and the Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended June 30, 2013 and 2012, the Consolidated Balance Sheets as of June 30, 2013 and December 31, 2012, and the Consolidated Statements of Cash Flows for the six months ended June 30, 2013 and 2012 of Itron, Inc. and its subsidiaries. All entries required for the fair presentation of the financial statements are of a normal recurring nature, except as disclosed.

Certain information and notes normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) regarding interim results. These condensed consolidated financial statements should be read in conjunction with the 2012 audited financial statements and notes included in our Annual Report on Form 10-K filed with the SEC on February 22, 2013. The results of operations for the three and six months ended June 30, 2013 are not necessarily indicative of the results expected for the full fiscal year or for any other fiscal period.

Basis of Consolidation

We consolidate all entities in which we have a greater than 50% ownership interest or in which we exercise control over the operations. We use the equity method of accounting for entities in which we have a 50% or less investment and exercise significant influence. Entities in which we have less than a 20% investment and where we do not exercise significant influence are accounted for under the cost method. Intercompany transactions and balances are eliminated upon consolidation.

Noncontrolling Interests

In several of our consolidated international subsidiaries, we have joint venture partners, who are minority shareholders. Although these entities are not wholly-owned by Itron, we consolidate them because we have a greater than 50% ownership interest or because we exercise control over the operations. The noncontrolling interest balance is adjusted each period to reflect the allocation of net income (loss) and other comprehensive income (loss) attributable to the noncontrolling interests, as shown in our Consolidated Statements of Operations and our Consolidated Statements of Comprehensive Income (Loss). The noncontrolling interest balance in our Consolidated Balance Sheets represents the proportional share of the equity of the joint venture entities, which is attributable to the minority shareholders.

Business Acquisitions

On May 1, 2012, we completed the acquisition of SmartSynch, Inc. (SmartSynch). SmartSynch provides smart grid solutions that utilize cellular networks for communications.

In January 2011, we completed the acquisition of a software and consulting services company in France, which included contingent and deferred consideration amounts that were paid in the first quarters of 2012 and 2013. See Business Combinations policy below.

Cash and Cash Equivalents

We consider all highly liquid instruments with remaining maturities of three months or less at the date of acquisition to be cash equivalents.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded for invoices issued to customers in accordance with our contractual arrangements. Interest and late payment fees are minimal. Unbilled receivables are recorded when revenues are recognized upon product shipment or service delivery and invoicing occurs at a later date. We record an allowance for doubtful accounts representing our estimate of the probable losses in accounts receivable at the date of the balance sheet based on our historical experience of bad debts and our specific review

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of outstanding receivables. Accounts receivable are written-off against the allowance when we believe an account, or a portion thereof, is no longer collectible.

Inventories

Inventories are stated at the lower of cost or market using the first-in, first-out method. Cost includes raw materials and labor, plus applied direct and indirect costs.

Derivative Instruments

All derivative instruments, whether designated in hedging relationships or not, are recorded on the Consolidated Balance Sheets at fair value as either assets or liabilities. The components and fair values of our derivative instruments are determined using the fair value measurements of significant other observable inputs (Level 2), as defined by GAAP. The net fair value of our derivative instruments may switch between a net asset and a net liability depending on market circumstances at the end of the period. We include the effect of our counterparty credit risk based on current published credit default swap rates when the net fair value of our derivative instruments are in a net asset position and the effect of our own nonperformance risk when the net fair value of our derivative instruments are in a net liability position.

For any derivative designated as a fair value hedge, the changes in the fair value of the derivative and of the hedged item attributable to the hedged risk are recognized in earnings. For any derivative designated as a cash flow hedge, the effective portions of changes in the fair value of the derivative are recorded as a component of other comprehensive income (loss) (OCI) and are recognized in earnings when the hedged item affects earnings. Ineffective portions of cash flow hedges are recognized in other income (expense) in the Consolidated Statements of Operations. For a hedge of a net investment, the effective portion of any unrealized gain or loss from the foreign currency revaluation of the hedging instrument is reported in OCI as a net unrealized gain or loss on derivative instruments. Upon termination of a net investment hedge, the net derivative gain/loss will remain in accumulated OCI until such time when earnings are impacted by a sale or liquidation of the associated operations. Ineffective portions of fair value changes or the changes in fair value of derivative instruments that do not qualify for hedging activities are recognized in other income (expense) in the Consolidated Statements of Operations. We classify cash flows from our derivative programs as cash flows from operating activities in the Consolidated Statements of Cash Flows.

Derivatives are not used for trading or speculative purposes. Our derivatives are with credit-worthy multinational commercial banks, with whom we have master netting agreements; however, our derivative positions are not disclosed on a net basis. There are no credit-risk-related contingent features within our derivative instruments. Refer to Note 7 and Note 13 for further disclosures of our derivative instruments and their impact on OCI.

Property, Plant, and Equipment

Property, plant, and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally 30 years for buildings and improvements and three to ten years for machinery and equipment, computers and software, and furniture. Leasehold improvements are capitalized and depreciated over the term of the applicable lease, including renewable periods if reasonably assured, or over the useful lives, whichever is shorter. Construction in process represents capital expenditures incurred for assets not yet placed in service. Costs related to internally developed software and software purchased for internal uses are capitalized and are amortized over the estimated useful lives of the assets. Repair and maintenance costs are expensed as incurred. We have no major planned maintenance activities.

We review long-lived assets for impairment whenever events or circumstances indicate the carrying amount of an asset group may not be recoverable. Assets held for sale are classified within other current assets in the Consolidated Balance Sheets, are reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. Gains and losses from asset disposals and impairment losses are classified within the Consolidated Statement of Operations according to the use of the asset, except those gains and losses recognized in conjunction with our restructuring activities, which are classified as restructuring expense.

Prepaid Debt Fees

Prepaid debt fees represent the capitalized direct costs incurred related to the issuance of debt and are recorded as noncurrent assets. These costs are amortized to interest expense over the lives of the respective borrowings, including contingent maturity or call features, using the effective interest method, or straight-line method when associated with a revolving credit facility. When debt is repaid early, the related portion of unamortized prepaid debt fees is written off and included in interest expense.

Business Combinations

On the date of acquisition, the assets acquired, liabilities assumed, and any noncontrolling interests in the acquiree are recorded at their fair values. The acquiree's results of operations are also included as of the date of acquisition in our consolidated results. Intangible assets that arise from contractual/legal rights, or are capable of being separated, as well as in-process research and

6

development (IPR&D), are measured and recorded at fair value, and amortized over the estimated useful life. IPR&D is not amortized until such time as the associated development projects are completed or terminated. If a development project is completed, the IPR&D is reclassified as a core technology intangible asset and amortized over its estimated useful life. If the development project is terminated, the recorded value of the associated IPR&D is immediately expensed. If practicable, assets acquired and liabilities assumed arising from contingencies are measured and recorded at fair value. If not practicable, such assets and liabilities are measured and recorded when it is probable that a gain or loss has occurred and the amount can be reasonably estimated. The residual balance of the purchase price, after fair value allocations to all identified assets and liabilities, represents goodwill. Acquisition-related costs are expensed as incurred. Restructuring costs associated with an acquisition are generally expensed in periods subsequent to the acquisition date, and changes in deferred tax asset valuation allowances and acquired income tax uncertainties, including penalties and interest, after the measurement period are recognized as a component of the provision for income taxes. Our acquisitions may include contingent consideration, which require us to recognize the fair value of the estimated liability at the time of the acquisition. Subsequent changes in the estimate of the amount to be paid under the contingent consideration arrangement are recognized in the consolidated statements of operations. Cash payments for contingent or deferred consideration are classified within cash flows from investing activities within the consolidated statements of cash flows.

Goodwill and Intangible Assets

Goodwill and intangible assets may result from our acquisitions. We use estimates, including estimates of useful lives of intangible assets, the amount and timing of related future cash flows, and fair values of the related operations, in determining the value assigned to goodwill and intangible assets. Our finite-lived intangible assets are amortized over their estimated useful lives based on estimated discounted cash flows. IPR&D is considered an indefinite-lived intangible asset and is not subject to amortization until the associated projects are completed or terminated. Finite-lived intangible assets are tested for impairment at the asset group level when events or changes in circumstances indicate the carrying value may not be recoverable. Indefinite-lived intangible assets are tested for impairment annually, when events or changes in circumstances indicate the asset may be impaired, or at the time when their useful lives are determined to be no longer indefinite.

Goodwill is assigned to our reporting units based on the expected benefit from the synergies arising from each business combination, determined by using certain financial metrics, including the forecasted discounted cash flows associated with each reporting unit.

We test goodwill for impairment each year as of October 1, or more frequently should a significant impairment indicator occur. As part of the impairment test, we may elect to perform an assessment of qualitative factors. If this qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit, including goodwill, is less than its carrying amount, or if we elect to bypass the qualitative assessment, we would then proceed with the two-step impairment test. The impairment test involves comparing the fair values of the reporting units to their carrying amounts. If the carrying amount of a reporting unit exceeds its fair value, a second step is required to measure the goodwill impairment loss amount. This second step determines the current fair values of all assets and liabilities of the reporting unit and then compares the implied fair value of the reporting unit's goodwill to the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in an amount equal to the excess.

Determining the fair value of a reporting unit is judgmental in nature and involves the use of significant estimates and assumptions. We forecast discounted future cash flows at the reporting unit level using risk-adjusted discount rates and estimated future revenues and operating costs, which take into consideration factors such as existing backlog, expected future orders, supplier contracts, and expectations of competitive and economic environments. We also identify similar publicly traded companies and develop a correlation, referred to as a multiple, to apply to the operating results of the reporting units. These combined fair values are then reconciled to the aggregate market value of our common stock on the date of valuation, while considering a reasonable control premium.

Contingencies

A loss contingency is recorded if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. We evaluate, among other factors, the degree of probability of an unfavorable outcome and our ability to make a reasonable estimate of the amount of the ultimate loss. Loss contingencies that we determine to be reasonably possible, but not probable, are disclosed but not recorded. Changes in these factors and related estimates could materially affect our financial position and results of operations. Legal costs to defend against contingent liabilities are expensed as incurred.

Bonus and Profit Sharing

We have various employee bonus and profit sharing plans, which provide award amounts for the achievement of annual financial and nonfinancial targets. If management determines it is probable that the targets will be achieved, and the amounts can be reasonably estimated, a compensation accrual is recorded based on the proportional achievement of the financial and nonfinancial targets. Although we monitor and accrue expenses quarterly based on our progress toward the achievement of the annual targets,

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the actual results at the end of the year may require awards that are significantly greater or less than the estimates made in earlier quarters.

Warranty

We offer standard warranties on our hardware products and large application software products. We accrue the estimated cost of new product warranties based on historical and projected product performance trends and costs during the warranty period. Testing of new products in the development stage helps identify and correct potential warranty issues prior to manufacturing. Continuing quality control efforts during manufacturing reduce our exposure to warranty claims. When our quality control efforts fail to detect a fault in one of our products, we experience an increase in warranty claims. We track warranty claims to identify potential warranty trends. If an unusual trend is noted, an additional warranty accrual may be assessed and recorded when a failure event is probable and the cost can be reasonably estimated. When new products are introduced, our process relies on historical averages of similar products until sufficient data is available. As actual experience becomes available, it is used to modify the original estimate to ensure the expected warranty costs are within a range of likely outcomes. Management continually evaluates the sufficiency of the warranty provisions and makes adjustments when necessary. The warranty allowances may fluctuate due to higher than anticipated material, labor, and other costs we may incur to repair or replace projected product failures, and we may incur additional warranty and related expenses in the future with respect to new or established products, which could adversely affect our financial position and results of operations. The long-term warranty balance includes estimated warranty claims beyond one year. Warranty expense is classified within cost of revenues.

Restructuring and Asset Impairments

We record a liability for costs associated with an exit or disposal activity at its fair value in the period in which the liability is incurred. Employee termination benefits considered postemployement benefits are accrued when the obligation is probable and estimable, such as benefits stipulated by human resource policies and practices or statutory requirements. One-time termination benefits are expensed at the date the employee is notified. If the employee must provide future service greater than 60 days, such benefits are expensed ratably over the future service period. For contract termination costs, we record a liability upon the later of when we terminate a contract in accordance with the contract terms or when we cease using the rights conveyed by the contract.

Asset impairments are determined at the asset group level. An impairment may be recorded for assets that are to be abandoned, are to be sold for less than net book value, or are held for sale in which the estimated proceeds less costs to sell are less than the net book value. We may also recognize impairment on an asset group, which is held and used, when the carrying value is not recoverable and exceeds the asset group's fair value. If an asset group is considered a business, a portion of the Company's goodwill balance is allocated to it based on relative fair value.

Defined Benefit Pension Plans

We sponsor both funded and unfunded defined benefit pension plans for certain international employees. We recognize a liability for the projected benefit obligation in excess of plan assets or an asset for plan assets in excess of the projected benefit obligation. We also recognize the funded status of our defined benefit pension plans on our Consolidated Balance Sheets and recognize as a component of OCI, net of tax, the actuarial gains or losses and prior service costs or credits, if any, that arise during the period but that are not recognized as components of net periodic benefit cost.

Share Repurchase Plan

We may repurchase up to $50 million of shares of Itron common stock under a twelve-month program, which was authorized by our Board of Directors on March 8, 2013. Share repurchases are made in the open market or in privately negotiated transactions and in accordance with applicable securities laws. Under applicable Washington State law, shares repurchased are retired and not displayed separately as treasury stock on the financial statements; the value of the repurchased shares is deducted from common stock.

Revenue Recognition

Revenues consist primarily of hardware sales, software license fees, software implementation, project management services, installation, consulting, and post-sale maintenance support. Revenues are recognized when (1) persuasive evidence of an arrangement exists, (2) delivery has occurred or services have been rendered, (3) the sales price is fixed or determinable, and (4) collectability is reasonably assured.

The majority of our revenue arrangements involve multiple deliverables, which combine two or more of the following: hardware, meter reading system software, installation, and/or project management services. Revenue arrangements with multiple deliverables are divided into separate units of accounting if the delivered item(s) has value to the customer on a standalone basis and delivery/performance of the undelivered item(s) is probable. The total arrangement consideration is allocated among the separate units of accounting based on their relative fair values and the applicable revenue recognition criteria considered for each unit of accounting. The amount allocable to a delivered item is limited to the amount that we are entitled to collect and that is not contingent upon

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the delivery/performance of additional items. Revenues for each deliverable are then recognized based on the type of deliverable, such as 1) when the products are shipped, 2) services are delivered, 3) percentage-of-completion when implementation services are essential to other deliverables in the arrangement, 4) upon receipt of customer acceptance, or 5) transfer of title and risk of loss. The majority of our revenue is recognized when products are shipped to or received by a customer or when services are provided.

If, among other factors, the data collection system does not use standard internet protocols and network design services are deemed complex and extensive, hardware revenues are recognized at the time of shipment, receipt by customer, or, if applicable, upon completion of customer acceptance provisions. Revenue from network software and services is recognized using the units-of-delivery method of contract accounting, as network design services and network software are essential to the functionality of the related hardware (network). This methodology results in the deferral of costs and revenues as professional services and software implementation commence prior to deployment of hardware.

In all other instances, hardware revenues are recognized at the time of shipment, receipt by customer, or, if applicable, upon completion of customer acceptance provisions. Network software is recognized when shipped if all other revenue recognition criteria are met and services are not essential to the functionality of the software. If implementation services are essential to the functionality of the network software, software and implementation revenues are recognized using the percentage-of-completion methodology of contract accounting when project costs are reliably estimated.

We also enter into multiple deliverable software arrangements that do not include hardware. For this type of arrangement, revenue recognition is dependent upon the availability of vendor specific objective evidence (VSOE) of fair value for each of the deliverables. The lack of VSOE, or the existence of extended payment terms or other inherent risks, may affect the timing of revenue recognition for multiple deliverable software arrangements.

Certain of our revenue arrangements include an extended or noncustomary warranty provision that covers all or a portion of a customer's replacement or repair costs beyond the standard or customary warranty period. Whether or not the extended warranty is separately priced in the arrangement, a portion of the arrangement's total consideration is allocated to this extended warranty deliverable. This revenue is deferred and recognized over the extended warranty coverage period. Extended or noncustomary warranties do not represent a significant portion of our revenue.

We allocate consideration to each deliverable in an arrangement based on its relative selling price. We determine selling price using VSOE, if it exists, otherwise we use third-party evidence (TPE). We define VSOE as a median price of recent standalone transactions that are priced within a narrow range. TPE is determined based on the prices charged by our competitors for a similar deliverable when sold separately. If neither VSOE nor TPE of selling price exists for a unit of accounting, we use estimated selling price (ESP) to determine the price at which we would transact if the product or service were regularly sold by us on a standalone basis. Our determination of ESP involves a weighting of several factors based on the specific facts and circumstances of the arrangement. The factors considered include the cost to produce the deliverable, the anticipated margin on that deliverable, our ongoing pricing strategy and policies, and the characteristics of the varying markets in which the deliverable is sold.

We analyze the selling prices used in our allocation of arrangement consideration on an annual basis. Selling prices are analyzed on a more frequent basis if a significant change in our business necessitates a more timely analysis or if we experience significant variances in our selling prices.

Unearned revenue is recorded when a customer pays for products or services, but the criteria for revenue recognition have not been met as of the balance sheet date. Unearned revenues of $83.7 million and $74.9 million at June 30, 2013 and December 31, 2012 related primarily to professional services and software associated with our smart metering contracts, extended or noncustomary warranty, and prepaid post-contract support. Deferred costs are recorded for products or services for which ownership (typically defined as title and risk of loss) has transferred to the customer, but the criteria for revenue recognition have not been met as of the balance sheet date. Deferred costs were $27.7 million and $24.4 million at June 30, 2013 and December 31, 2012 and are recorded within other assets in the Consolidated Balance Sheets.

Hardware and software post-sale maintenance support fees are recognized ratably over the life of the related service contract. Shipping and handling costs and incidental expenses billed to customers are recorded as revenue, with the associated cost charged to cost of revenues. We record sales, use, and value added taxes billed to our customers on a net basis.

Product and Software Development Costs

Product and software development costs primarily include employee compensation and third party contracting fees. We do not capitalize product development costs, and we do not generally capitalize software development expenses as the costs incurred are immaterial for the relatively short period of time between technological feasibility and the completion of software development.

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Stock-Based Compensation

We measure and recognize compensation expense for all stock-based awards made to employees and directors, including stock options, stock sold pursuant to our Employee Stock Purchase Plan (ESPP), and the issuance of restricted stock units and unrestricted stock awards, based on estimated fair values. The fair value of stock options is estimated at the date of grant using the Black-Scholes option-pricing model, which includes assumptions for the dividend yield, expected volatility, risk-free interest rate, and expected term. For ESPP awards, the fair value is the difference between the market close price of our common stock on the date of purchase and the discounted purchase price. For performance-based restricted stock units and unrestricted stock awards with no market conditions, the fair value is the market close price of our common stock on the date of grant. For restricted stock units with market conditions, the fair value is estimated at the date of award using a Monte Carlo simulation model, which includes assumptions for dividend yield and expected volatility for our common stock and the common stock for companies within the Russell 3000 index, as well as the risk-free interest rate and expected term of the awards. We expense stock-based compensation at the date of grant for unrestricted stock awards. For awards with only a service condition, we expense stock-based compensation, adjusted for estimated forfeitures, using the straight-line method over the requisite service period for the entire award. For awards with performance and service conditions, if vesting is probable, we expense the stock-based compensation, adjusted for estimated forfeitures, on a straight-line basis over the requisite service period for each separately vesting portion of the award. For awards with a market condition, we expense the fair value over the requisite service period. Excess tax benefits are credited to common stock when the deduction reduces cash taxes payable. When we have tax deductions in excess of the compensation cost, they are classified as financing cash inflows in the Consolidated Statements of Cash Flows.

Income Taxes

We compute our interim income tax provision through the use of an estimated annual effective tax rate (ETR) applied to year-to-date operating results and specific events that are discretely recognized as they occur. In determining the estimated annual ETR, we analyze various factors, including the forecasted mix of earnings in domestic and international jurisdictions, new or revised tax legislation and accounting pronouncements, tax credits, state income taxes, adjustments to valuation allowances, and uncertain tax positions, amount other items. Discrete items, including the effect of changes in tax laws, tax rates, and certain circumstances with respect to valuation allowances or other unusual or non-recurring tax adjustments, are reflected in the period in which they occur as an addition to, or reduction from, the income tax provision, rather than included in the estimated annual ETR.

Deferred tax assets and liabilities are recognized based upon anticipated future tax consequences, in each of the jurisdictions in which we operate, attributable to: (1) the differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases; and (2) operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The calculation of our tax liabilities involves applying complex tax regulations in different jurisdictions to our tax positions. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying amount of deferred tax assets if it is more likely than not that such assets will not be realized. We do not record tax liabilities on undistributed earnings of international subsidiaries that are permanently reinvested.

We utilize a two step approach to account for uncertain tax positions. A tax position is first evaluated for recognition based on its technical merits. Tax positions that have a greater than fifty percent likelihood of being realized upon ultimate settlement are then measured to determine amounts to be recognized in the financial statements. This measurement incorporates information about potential settlements with taxing authorities. A previously recognized tax position is derecognized in the first period in which the position no longer meets the more-likely-than-not recognition threshold or upon expiration of the statute of limitations. We classify interest expense and penalties related to uncertain tax positions and interest income on tax overpayments as part of income tax expense.

Foreign Exchange

Our consolidated financial statements are reported in U.S. dollars. Assets and liabilities of international subsidiaries with non-U.S. dollar functional currencies are translated to U.S. dollars at the exchange rates in effect on the balance sheet date, or the last business day of the period, if applicable. Revenues and expenses for each subsidiary are translated to U.S. dollars using a weighted average rate for the relevant reporting period. Translation adjustments resulting from this process are included, net of tax, in OCI. Gains and losses that arise from exchange rate fluctuations for monetary asset and liability balances that are not denominated in an entity’s functional currency are included within other income (expense), net in the Consolidated Statements of Operations. Currency gains and losses of intercompany balances deemed to be long-term in nature or designated as a hedge of the net investment in international subsidiaries are included, net of tax, in OCI.

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Fair Value Measurements

For assets and liabilities measured at fair value, the GAAP fair value hierarchy prioritizes the inputs used in different valuation methodologies, assigning the highest priority to unadjusted quoted prices for identical assets and liabilities in actively traded markets (Level 1) and the lowest priority to unobservable inputs (Level 3). Level 2 inputs consist of quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in non-active markets; and model-derived valuations in which significant inputs are corroborated by observable market data either directly or indirectly through correlation or other means. Inputs may include yield curves, volatility, credit risks, and default rates.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Due to various factors affecting future costs and operations, actual results could differ materially from these estimates.

New Accounting Pronouncements

The Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2013.11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists" on July 18, 2013. The ASU concludes an unrecognized tax benefit should be presented as a reduction of a deferred tax asset when settlement in this manner is available under the law. We will adopt this amendment as of January 2014. The result of adoption may be to reclassify certain long term liabilities to long term deferred tax assets, and the adoption will not result in a change to the tax provision. Management does not believe that the impact on the balance sheet will be significant.

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Note 2:    Earnings Per Share and Capital Structure

The following table sets forth the computation of basic and diluted earnings per share (EPS):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands, except per share data)
Net income available to common shareholders	$	12,399	$	31,615	$	14,969	$	56,968
Weighted average common shares outstanding - Basic	39,431		39,887		39,426		39,900
Dilutive effect of stock-based awards	247		239		298		270
Weighted average common shares outstanding - Diluted	39,678		40,126		39,724		40,170
Earnings per common share - Basic	$	0.31	$	0.79	$	0.38	$	1.43
Earnings per common share - Diluted	$	0.31	$	0.79	$	0.38	$	1.42

Stock-based Awards

For stock-based awards, the dilutive effect is calculated using the treasury stock method. Under this method, the dilutive effect is computed as if the awards were exercised at the beginning of the period (or at time of issuance, if later) and assumes the related proceeds were used to repurchase common stock at the average market price during the period. Related proceeds include the amount the employee must pay upon exercise, future compensation cost associated with the stock award, and the amount of excess tax benefits, if any. Approximately 1.1 million and 1.2 million stock-based awards were excluded from the calculation of diluted EPS for each of the three and six months ended June 30, 2013, and approximately 1.4 million and 1.3 million stock-based awards were excluded from the calculation of diluted EPS for each of the three and six months ended June 30, 2012, because they were anti-dilutive. These stock-based awards could be dilutive in future periods.

Preferred Stock

We have authorized the issuance of 10 million shares of preferred stock with no par value. In the event of a liquidation, dissolution, or winding up of the affairs of the corporation, whether voluntary or involuntary, the holders of any outstanding preferred stock would be entitled to be paid a preferential amount per share to be determined by the Board of Directors prior to any payment to holders of common stock. There was no preferred stock issued or outstanding at June 30, 2013 and December 31, 2012.

Stock Repurchase Plan

On March 8, 2013, the Board authorized a twelve-month repurchase program of up to $50 million of our common stock. As of June 30, 2013, we have repurchased 384,800 shares of our common stock, totaling $16.1 million, with $33.9 million remaining under the repurchase program. Repurchases are made in the open market or in privately negotiated transactions, and in accordance with applicable securities laws. Refer to Part II, Item 2: "Unregistered Sales of Equity Securities and Use of Proceeds" for additional information related to our share repurchase program.

Note 3:    Certain Balance Sheet Components

Accounts receivable, net	June 30, 2013		December 31, 2012
	(in thousands)
Trade receivables (net of allowance of $6,948 and $7,372)	$	330,956	$	329,352
Unbilled receivables	41,284		45,974
Total accounts receivable, net	$	372,240	$	375,326

At June 30, 2013 and December 31, 2012, $19.0 million and $20.0 million were recorded within trade receivables as billed but not yet paid by customers, in accordance with contract retainage provisions. At June 30, 2013 and December 31, 2012, contract retainage amounts that were unbilled and classified as unbilled receivables were $11.1 million. We had no long-term unbilled receivables or long-term retainage contract receivables at June 30, 2013 and December 31, 2012, as we expect to collect all contract retainage receivables within the following 12 months.

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Allowance for doubtful account activity	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Beginning balance	$	6,144		$	5,983		$	7,372		$	6,049
Provision (release) of doubtful accounts, net	1,075			(230		)	171			(290		)
Accounts written-off	(198		)	(22		)	(303		)	(261		)
Effects of change in exchange rates	(73		)	(350		)	(292		)	(117		)
Ending balance	$	6,948		$	5,381		$	6,948		$	5,381

Inventories	June 30, 2013		December 31, 2012
	(in thousands)
Materials	$	104,283	$	92,038
Work in process	13,879		12,568
Finished goods	72,252		66,113
Total inventories	$	190,414	$	170,719

Our inventory levels may vary period to period as a result of our factory scheduling and the timing of contract fulfillments, which may include the buildup of finished goods for shipment.

Consigned inventory is held at third-party locations; however, we retain title to the inventory until purchased by the third-party. Consigned inventory, consisting of raw materials and finished goods, was $5.7 million and $5.0 million at June 30, 2013 and December 31, 2012, respectively.

Property, plant, and equipment, net	June 30, 2013			December 31, 2012
	(in thousands)
Machinery and equipment	$	290,500		$	287,791
Computers and software	88,186			84,980
Buildings, furniture, and improvements	143,420			146,191
Land	24,663			25,318
Construction in progress, including purchased equipment	33,529			26,097
Total cost	580,298			570,377
Accumulated depreciation	(330,926		)	(315,165		)
Property, plant, and equipment, net	$	249,372		$	255,212

Depreciation expense and capitalized interest	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Depreciation expense	$	14,027	$	15,019	$	28,040	$	30,333
Capitalized interest	21		—		64		—

In conjunction with the upgrade of our global enterprise resource planning software systems, we have capitalized $11.1 million within construction in progress at June 30, 2013. Amounts capitalized include internal labor costs and related benefits, software, third-party consulting fees, and $21,000 and $64,000 of interest for the three and six months ended June 30, 2013, respectively.

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Note 4:    Intangible Assets

The gross carrying amount and accumulated amortization of our intangible assets, other than goodwill, are as follows:

	June 30, 2013							December 31, 2012
	Gross Assets		Accumulated Amortization			Net		Gross Assets		Accumulated Amortization			Net
	(in thousands)
Core-developed technology	$	420,055	$	(338,145	)	$	81,910	$	407,024	$	(332,763	)	$	74,261
Customer contracts and relationships	281,644		(159,231		)	122,413		292,252		(154,890		)	137,362
Trademarks and trade names	71,356		(64,897		)	6,459		72,770		(65,090		)	7,680
Other	11,091		(11,024		)	67		11,094		(11,026		)	68
Total intangible assets subject to amortization	784,146		(573,297		)	210,849		783,140		(563,769		)	219,371
In-process research and development	—					—		19,400					19,400
Total intangible assets	$	784,146	$	(573,297	)	$	210,849	$	802,540	$	(563,769	)	$	238,771

A summary of the intangible asset account activity is as follows:

	Six Months Ended June 30,
	2013			2012
	(in thousands)
Beginning balance, intangible assets, gross	$	802,540		$	749,194
Intangible assets acquired	(1,500		)	43,400
Effect of change in exchange rates	(16,894		)	(13,835		)
Ending balance, intangible assets, gross	$	784,146		$	778,759

Intangible assets acquired in 2012 were related to the SmartSynch acquisition on May 1, 2012, including IPR&D assets that consisted primarily of projects to upgrade the hardware components of cellular communication modules to be compatible with 3G cellular network standards. Upon completion of these projects in March 2013, we performed a qualitative assessment and determined that it was more than likely that the carrying amount of IPR&D was not impaired. Accordingly, the carrying amount of IPR&D was reclassified as core-developed technology and will be amortized over its expected useful life of seven years based on the SmartSynch acquisition discounted cash flow valuation model. For the six months ended June 30, 2013, the adjustment of $1.5 million to intangible assets acquired is associated with the correction of an error for a long-term revenue contract from the SmartSynch acquisition. See Note 5 for further discussion of the correction of the error and its impact on goodwill.

Intangible assets of our international subsidiaries are recorded in their respective functional currency; therefore, the carrying amounts of intangible assets increase or decrease, with a corresponding change in accumulated OCI, due to changes in foreign currency exchange rates.

Estimated future annual amortization expense is as follows:

Years ending December 31,	Estimated Annual Amortization
	(in thousands)
2013 (amount remaining at June 30, 2013)	$	20,734
2014	43,434
2015	34,800
2016	27,345
2017	20,314
Beyond 2017	64,222
Total intangible assets, net	$	210,849

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Note 5:    Goodwill

The following table reflects the goodwill balance as of June 30, 2013:

	Energy			Water			Total Company
	(in thousands)
Balance at January 1, 2013
Goodwill before impairment	$	859,454		$	414,394		$	1,273,848
Accumulated impairment losses	(249,502		)	(323,330		)	(572,832		)
Goodwill, net	609,952			91,064			701,016
Adjustments of previous acquisition	3,958			—			3,958
Effect of change in exchange rates	(7,551		)	(1,208		)	(8,759		)
Balance at June 30, 2013
Goodwill before impairment	851,471			407,497			1,258,968
Accumulated impairment losses	(245,112		)	(317,641		)	(562,753		)
Goodwill, net	$	606,359		$	89,856		$	696,215

During the second quarter of 2013, we finalized the purchase price allocation related to the SmartSynch acquisition, which was completed on May 1, 2012, and recorded certain adjustments that are reflected as Adjustments of previous acquisition. These adjustments primarily affected the fair value calculation of certain accrued liabilities associated with specific contracts. Among these adjustments is the correction of an error associated with a long-term revenue contract acquired from SmartSynch. In May 2013, we determined that certain manufacturing costs were not reflected in the model used to value this contract at acquisition. Once these costs were properly added to the total cost and profitability estimates, we determined the total contract would result in a loss of $2.4 million over the contract term. Therefore, we recognized a liability for this expected loss on the contract and made a corresponding adjustment to goodwill. Further, we had previously recognized a customer relationship intangible asset of $1.5 million associated with this contract, with amortization scheduled to begin in 2014 based on the contract's original projected cash flow. Since the contract is in an overall loss position, we determined that the intangible asset had no value. We reduced the value of this intangible asset to zero with a corresponding adjustment to goodwill. In accordance with relevant accounting guidance, we evaluated the materiality of the error from a qualitative and quantitative perspective. Based on such evaluation, we concluded that recognizing the contract liability and adjusting the intangible asset value would not be material, quantitatively or qualitatively, to our results of operations for the three months ended June 30, 2013 or our expected full year results of operations for 2013 and would not have had a material impact on our results for the year ended December 31, 2012. Because these adjustments were not material individually or in aggregate, we have not retrospectively adjusted the comparative amounts on the Consolidated Balance Sheet as of December 31, 2012.

Accumulated impairment losses relate to goodwill impairment charges recorded during 2011 as a result of a significant decline in the price of our shares of common stock at the end of September 2011, which reduced our aggregate market value significantly below the carrying value of our net assets as of September 30, 2011.

Goodwill and accumulated impairment losses associated with our international subsidiaries are recorded in their respective functional currency; therefore, the carrying amounts of these balances increase or decrease, with a corresponding change in accumulated OCI, due to changes in foreign currency exchange rates.

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Note 6:    Debt

The components of our borrowings were as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Credit facility:
USD denominated term loan	$	270,000	$	277,500
Multicurrency revolving line of credit	140,000		140,000
Total debt	410,000		417,500
Less: current portion of debt	22,500		18,750
Long-term debt	$	387,500	$	398,750

Credit Facility

Our credit facility is dated August 5, 2011. The credit facility consists of a $300 million U.S. dollar term loan (the term loan) and a multicurrency revolving line of credit (the revolver) with a principal amount of up to $660 million. Both the term loan and the revolver mature on August 8, 2016, and amounts borrowed under the revolver are classified as long-term. Amounts borrowed under the revolver during the credit facility term may be repaid and reborrowed until the revolver's maturity, at which time the revolver will terminate, and all outstanding loans, together with all accrued and unpaid interest, must be repaid. Amounts not borrowed under the revolver are subject to a commitment fee, which is paid in arrears on the last day of each fiscal quarter, ranging from 0.20% to 0.40% per annum depending on our total leverage ratio as of the most recently ended fiscal quarter. Amounts repaid on the term loan may not be reborrowed. The credit facility permits us and certain of our foreign subsidiaries to borrow in U.S. dollars, euros, British pounds, or, with lender approval, other currencies readily convertible into U.S. dollars. All obligations under the credit facility are guaranteed by Itron, Inc. and material U.S. domestic subsidiaries and are secured by a pledge of substantially all of the assets of Itron, Inc. and material U.S. domestic subsidiaries, including a pledge of 100% of the capital stock of material U.S. domestic subsidiaries and up to 66% of the voting stock (100% of the non-voting stock) of their first-tier foreign subsidiaries. In addition, the obligations of any foreign subsidiary who is a foreign borrower, as defined by the credit facility, are guaranteed by the foreign subsidiary and by its direct and indirect foreign parents. The credit facility includes debt covenants, which contain certain financial ratios and place certain restrictions on the incurrence of debt, investments, and the issuance of dividends. We were in compliance with the debt covenants under the credit facility at June 30, 2013.

Scheduled principal repayments for the term loan are due quarterly in the amounts of $5.6 million from September 2013 through June 2014 and $7.5 million from September 2014 through June 2016, with the remainder due at maturity on August 8, 2016. The term loan may be repaid early in whole or in part, subject to certain minimum thresholds, without penalty.

Under the credit facility, we elect applicable market interest rates for both the term loan and any outstanding revolving loans. We also pay an applicable margin, which is based on our total leverage ratio (as defined in the credit agreement). The applicable rates per annum may be based on either: (1) the LIBOR rate, plus an applicable margin, or (2) the Alternate Base Rate, plus an applicable margin. The Alternate Base Rate election is equal to the greatest of three rates: (i) the prime rate, (ii) the Federal Reserve effective rate plus 1/2 of 1%, or (iii) one month LIBOR plus 1%. At June 30, 2013, the interest rate for both the term loan and the revolver was 1.45% (the LIBOR rate plus a margin of 1.25%).

Total credit facility repayments were as follows:

	Six Months Ended June 30,
	2013		2012
	(in thousands)
Term loan	$	7,500	$	7,502
Multicurrency revolving line of credit (1)	15,000		60,000
Total credit facility repayments	$	22,500	$	67,502

⁽¹⁾ We borrowed $15.0 million and $70.0 million under the multicurrency revolving line of credit during the six months ended June 30, 2013 and 2012.

At June 30, 2013, $140.0 million was outstanding under the credit facility revolver, and $47.0 million was utilized by outstanding standby letters of credit, resulting in $473.0 million available for additional borrowings.

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Unamortized prepaid debt fees were as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Unamortized prepaid debt fees	$	4,588	$	5,367

Note 7:    Derivative Financial Instruments

As part of our risk management strategy, we use derivative instruments to hedge certain foreign currency and interest rate exposures. Refer to Note 1, Note 13, and Note 14 for additional disclosures on our derivative instruments.

The fair values of our derivative instruments are determined using the income approach and significant other observable inputs (also known as “Level 2”). We have used observable market inputs based on the type of derivative and the nature of the underlying instrument. The key inputs include interest rate yield curves (swap rates and futures) and foreign exchange spot and forward rates, all of which are available in an active market. We have utilized the mid-market pricing convention for these inputs. We include, as a discount to the derivative asset, the effect of our counterparty credit risk based on current published credit default swap rates when the net fair value of our derivative instruments is in a net asset position. We consider our own nonperformance risk when the net fair value of our derivative instruments is in a net liability position by discounting our derivative liabilities to reflect the potential credit risk to our counterparty through applying a current market indicative credit spread to all cash flows.

The fair values of our derivative instruments at June 30, 2013 and December 31, 2012 were as follows:

		Fair Value
	Balance Sheet Location	June 30, 2013		December 31, 2012
		(in thousands)
Asset Derivatives
Derivatives not designated as hedging instruments under ASC 815-20
Foreign exchange forward contracts	Other current assets	$	122	$	146
Liability Derivatives
Derivatives designated as hedging instruments under ASC 815-20
Interest rate swap contracts	Other current liabilities	$	1,348	$	629
Interest rate swap contracts	Other long-term obligations	134		2,096
Derivatives not designated as hedging instruments under ASC 815-20
Foreign exchange forward contracts	Other current liabilities	108		114
Total liability derivatives		$	1,590	$	2,839

A summary of the potential effect of netting arrangements on our financial position related to the offsetting of our recognized derivative assets and liabilities under master netting arrangements or similar agreements is as follows:

Offsetting of Derivative Assets
			Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Assets Presented in the Consolidated Balance Sheets		Derivative Financial Instruments			Cash Collateral Received		Net Amount
	(in thousands)
June 30, 2013	$	122	$	(122	)	$	—	$	—
December 31, 2012	$	146	$	(135	)	$	—	$	11

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Offsetting of Derivative Liabilities
			Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Liabilities Presented in the Consolidated Balance Sheets		Derivative Financial Instruments			Cash Collateral Pledged		Net Amount
	(in thousands)
June 30, 2013	$	1,590	$	(122	)	$	—	$	1,468
December 31, 2012	$	2,839	$	(135	)	$	—	$	2,704

Our derivative assets and liabilities consist of foreign exchange forward and interest rate swap contracts with nine counterparties at June 30, 2013 and eight counterparties at December 31, 2012. None of our counterparties were individually significant at June 30, 2013 or December 31, 2012. Our derivative contracts with each of these counterparties exist under agreements that provide for the net settlement of all contracts through a single payment in a single currency in the event of default. We have no pledges of cash collateral against our obligations nor have we received pledges of cash collateral from our counterparties under the associated derivative contracts.

OCI during the reporting periods for our derivative hedging instruments, net of tax, was as follows:

	2013			2012
	(in thousands)
Net unrealized loss on hedging instruments at January 1,	$	(16,069	)	$	(14,380	)
Unrealized gain (loss) on derivative instruments	772			(849		)
Net unrealized loss on hedging instruments at June 30,	$	(15,297	)	$	(15,229	)

Included in the net unrealized loss on hedging instruments at June 30, 2013 and 2012 is a loss of $14.4 million, net of tax, related to our nonderivative net investment hedge, which terminated in 2011. This loss on our net investment hedge will remain in accumulated OCI until such time when earnings are impacted by a sale or liquidation of the associated foreign operation.

Cash Flow Hedges

As a result of our floating rate debt, we are exposed to variability in our cash flows from changes in the applicable interest rate index. We enter into swaps to achieve a fixed rate of interest on the hedged portion of debt in order to increase our ability to forecast interest expense. The objective of these swaps is to reduce the variability of cash flows from increases in the LIBOR base borrowing rates on our floating rate credit facility. The swaps do not protect us from changes to the applicable margin under our credit facility.

In May 2012, we entered into six forward starting pay-fixed receive one-month LIBOR interest rate swaps. The interest rate swaps convert $200 million of our LIBOR based debt from a floating LIBOR interest rate to a fixed interest rate of 1.00% (excluding the applicable margin on the debt) and are effective July 31, 2013 to August 8, 2016. These cash flow hedges are expected to be highly effective in achieving offsetting cash flows attributable to the hedged risk through the term of the hedge. Consequently, effective changes in the fair value of the interest rate swaps are recorded as a component of OCI and will be recognized in earnings when the hedged item affects earnings. The amounts paid or received on the hedges will be recognized as adjustments to interest expense. The amount of net losses expected to be reclassified into earnings in the next 12 months is $1.3 million. At June 30, 2013, our LIBOR based debt balance was $410.0 million.

We will continue to monitor and assess our interest rate risk and may institute additional interest rate swaps or other derivative instruments to manage such risk in the future.

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The before-tax effect of our cash flow derivative instruments on the Consolidated Balance Sheets and the Consolidated Statements of Operations for the three and six months ended June 30 were as follows:

Derivatives in ASC 815-20 Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in OCI on Derivative  (Effective Portion)					Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)					Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
						Location	Amount				Location	Amount
	2013		2012				2013		2012			2013		2012
	(in thousands)						(in thousands)					(in thousands)
Three Months Ended June 30,
Interest rate swap contracts	$	1,336	$	(1,365	)	Interest expense	$	—	$	—	Interest expense	$	—	$	—
Six Months Ended June 30,
Interest rate swap contracts	$	1,244	$	(1,365	)	Interest expense	$	—	$	—	Interest Expense	$	—	$	—

Derivatives Not Designated as Hedging Relationships

We are also exposed to foreign exchange risk when we enter into non-functional currency transactions, both intercompany and third-party. At each period-end, non-functional currency monetary assets and liabilities are revalued with the change recorded to other income and expense. We enter into monthly foreign exchange forward contracts (a total of 247 contracts were entered into during the six months ended June 30, 2013), which are not designated for hedge accounting, with the intent to reduce earnings volatility associated with certain of these non-functional currency assets and liabilities. The notional amounts of the contracts ranged from $251,000 to $11.0 million, offsetting our exposures to the euro, Saudi riyal, Canadian dollar, Australian dollar, Brazilian real, South African rand, and various other currencies.

The effect of our foreign exchange forward derivative instruments on the Consolidated Statements of Operations for the three and six months ended June 30 was as follows:

Derivatives Not Designated as Hedging Instrument under ASC 815-20	Gain (Loss) Recognized on Derivatives in Other Income (Expense)
	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Foreign exchange forward contracts	$	(971	)	$	(244	)	$	(757	)	$	(421	)

Note 8:    Defined Benefit Pension Plans

We sponsor both funded and unfunded defined benefit pension plans for our international employees, primarily in Germany, France, Italy, Indonesia, and Spain, offering death and disability, retirement, and special termination benefits. The defined benefit obligation is calculated annually by using the projected unit credit method. The measurement date for the pension plans was December 31, 2012.

Our defined benefit pension plans are denominated in the functional currencies of the respective countries in which the plans are sponsored; therefore, the balances increase or decrease, with a corresponding change in OCI, due to changes in foreign currency exchange rates. Amounts recognized on the Consolidated Balance Sheets consist of:

	June 30, 2013		December 31, 2012
	(in thousands)
Assets
Plan assets in other long-term assets	$	226	$	227
Liabilities
Current portion of pension plan liability in wages and benefits payable	3,157		2,899
Long-term portion of pension plan liability	89,948		90,533
Net pension plan benefit liability	$	92,879	$	93,205

Our asset investment strategy focuses on maintaining a portfolio using primarily insurance funds, which are accounted for as investments and measured at fair value, in order to achieve our long-term investment objectives on a risk adjusted basis. Our

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general funding policy for these qualified pension plans is to contribute amounts sufficient to satisfy regulatory funding standards of the respective countries for each plan. We contributed $110,000 and $355,000 to the defined benefit pension plans for the six months ended June 30, 2013 and 2012, respectively. The timing of when contributions are made can vary by plan and from year to year. For 2013, assuming that actual plan asset returns are consistent with our expected rate of return, and that interest rates remain constant, we expect to contribute approximately $568,000 to our defined benefit pension plans. We contributed $440,000 to the defined benefit pension plans for the year ended December 31, 2012.

Net periodic pension benefit costs for our plans include the following components:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Service cost	$	1,011		$	676		$	1,992		$	1,414
Interest cost	786			909			1,586			1,835
Expected return on plan assets	(79		)	(82		)	(158		)	(167		)
Settlements and other	—			—			(814		)	—
Amortization of actuarial net loss	246			2			497			4
Amortization of unrecognized prior service costs	17			17			34			34
Net periodic benefit cost	$	1,981		$	1,522		$	3,137		$	3,120

Note 9:    Stock-Based Compensation

We record stock-based compensation expense for awards of stock options, stock sold pursuant to our ESPP, and the issuance of restricted stock units and unrestricted stock awards. We expense stock-based compensation primarily using the straight-line method over the requisite service period. Capitalized stock-based compensation amounts were not material for the three and six months ended June 30, 2013 and 2012. For the three and six months ended June 30, stock-based compensation expense and the related tax benefit were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Stock options	$	519	$	337	$	992	$	609
Restricted stock units	4,158		4,375		8,393		7,891
Unrestricted stock awards	205		205		402		410
ESPP	144		141		335		346
Total stock-based compensation	$	5,026	$	5,058	$	10,122	$	9,256
Related tax benefit	$	1,391	$	1,375	$	2,755	$	2,564

We issue new shares of common stock upon the exercise of stock options or when vesting conditions on restricted stock units are fully satisfied.

Subject to stock splits, dividends, and other similar events, 3,500,000 shares of common stock are reserved and authorized for issuance under our 2010 Stock Incentive Plan (Stock Incentive Plan). Awards consist of stock options, restricted stock units, and unrestricted stock awards. At June 30, 2013, 431,758 shares were available for grant under the Stock Incentive Plan. The Stock Incentive Plan shares are subject to a fungible share provision such that, with respect to grants made after December 31, 2009, the authorized share reserve is reduced by (i) one share for every one share subject to a stock option or share appreciation right granted under the Plan and (ii) 1.7 shares for every one share of common stock that was subject to an award other than an option or stock appreciation right.

Stock Options

Options to purchase our common stock are granted to employees and members of the Board of Directors with an exercise price equal to the market close price of the stock on the date the Board of Directors approves the grant. Options generally become exercisable in three equal annual installments beginning one year from the date of grant and generally expire 10 years from the date of grant. Compensation expense is recognized only for those options expected to vest, with forfeitures estimated based on our historical experience and future expectations.

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The fair values of stock options granted were estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013(1)		2012(1)		2013		2012
Dividend yield	—	%	—	%	—	%	—	%
Expected volatility	—	%	—	%	38.1	%	42.7	%
Risk-free interest rate	—	%	—	%	1.0	%	0.9	%
Expected term (years)	—		—		5.45		5.14

⁽¹⁾  There were no employee stock options granted for the three months ended June 30, 2013 and 2012.

Expected volatility is based on a combination of the historical volatility of our common stock and the implied volatility of our traded options for the related expected term. We believe this combined approach is reflective of current and historical market conditions and is an appropriate indicator of expected volatility. The risk-free interest rate is the rate available as of the award date on zero-coupon U.S. government issues with a term equal to the expected life of the award. The expected life is the weighted average expected life of an award based on the period of time between the date the award is granted and the estimated date the award will be fully exercised. Factors considered in estimating the expected life include historical experience of similar awards, contractual terms, vesting schedules, and expectations of future employee behavior. We have not paid dividends in the past and do not plan to pay dividends in the foreseeable future.

A summary of our stock option activity for the six months ended June 30 is as follows:

	Shares		Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value (1)		Weighted Average Grant Date Fair Value
	(in thousands)				(years)	(in thousands)
Outstanding, January 1, 2012	1,109		$	55.97	4.51	$	2,323
Granted	54		48.23					$	18.64
Exercised	(28	)	20.32			$	576
Expired	(32	)	69.69
Outstanding, June 30, 2012	1,103		$	56.10	4.32	$	3,090
Outstanding, January 1, 2013	1,137		$	54.06	4.81	$	3,815
Granted	128		42.76					$	15.44
Exercised	(32	)	23.36			$	639
Expired	(8	)	49.92
Outstanding, June 30, 2013	1,225		$	53.71	4.99	$	2,388
Exercisable, June 30, 2013	901		$	57.52	3.43	$	2,186
Expected to vest, June 30, 2013	304		$	43.17	9.32	$	190

⁽¹⁾  The aggregate intrinsic value of outstanding stock options represents amounts that would have been received by the optionees had all in- the-money options been exercised on that date. Specifically, it is the amount by which the market value of Itron’s stock exceeded the exercise price of the outstanding in-the-money options before applicable income taxes, based on our closing stock price on the last business day of the period. The aggregate intrinsic value of stock options exercised during the period is calculated based on our stock price at the date of exercise.

As of June 30, 2013, total unrecognized stock-based compensation expense related to nonvested stock options was approximately $4.1 million, which is expected to be recognized over a weighted average period of approximately 2.3 years.

Restricted Stock Units

Certain employees, senior management, and members of the Board of Directors receive restricted stock units as a component of their total compensation. The fair value of a restricted stock unit is the market close price of our common stock on the date of grant. Restricted stock units generally vest over a three year period. Compensation expense, net of forfeitures, is recognized over the requisite service period.

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Subsequent to vesting, the restricted stock units are converted into shares of our common stock on a one-for-one basis and issued to employees. We are entitled to an income tax deduction in an amount equal to the taxable income reported by the employees upon vesting of the restricted stock units.

Prior to 2013, the performance-based restricted stock units issued under the Long-Term Performance Restricted Stock Unit Award Agreement (Performance Award Agreement) were determined based on the attainment of certain performance goals after the end of the one-year performance period. During the year, if management determined that it was probable that the targets would be achieved, compensation expense, net of forfeitures, was recognized on a straight-line basis over the annual performance and subsequent vesting period for each separately vesting portion of the award. Performance awards typically vested and were released in three equal installments at the end of each year following attainment of the performance goals. For U.S. participants who retire during the vesting period, unvested restricted stock units immediately vest at the date of retirement. For the 2012 performance awards, no awards became eligible for vesting as minimum performance thresholds for the 2012 performance year were not met.

For 2013, the performance-based restricted stock units to be issued under the Performance Award Agreement are determined based on (1) our achievement of specified non-GAAP EPS targets, as established at the beginning of each year for each of the calendar years contained in the performance periods (2-year and 3-year awards) (the performance condition) and (2) our total shareholder return (TSR) relative to the TSR attained by companies that are included in the Russell 3000 Index during the performance periods (the market condition). Compensation expense, net of forfeitures, is recognized on a straight-line basis, and the units vest upon achievement of the performance condition, provided participants are employed by Itron at the end of the respective performance periods. For U.S. participants who retire during the performance period, a pro-rated number of restricted stock units (based on the number of days of employment during the performance period) immediately vest based on the attainment of the performance goals as assessed after the end of the performance period.

Depending on the level of achievement of the performance condition, the actual number of shares to be earned ranges between 0% and 160% of the awards originally granted. At the end of the 2-year and 3-year performance periods, if the performance conditions are achieved at or above threshold, the number of shares earned is further adjusted by a TSR multiplier payout percentage, which ranges between 75% and 125%, based on the market condition. Therefore, based on the attainment of the performance and market conditions, the actual number of shares that vest may range from 0% to 200% of the awards originally granted. Due to the presence of the TSR multiplier market condition, we utilize a Monte Carlo valuation model to determine the fair value of the awards at the grant date. This pricing model uses multiple simulations to evaluate the probability of our achievement of various stock price levels to determine our expected TSR performance ranking. The weighted-average assumptions used to estimate the fair value of performance-based restricted stock units awarded and the resulting weighted average fair-value are as follows:

	Three Months Ended June 30, 2013			Six Months Ended June 30, 2013
Dividend yield	—		%	—		%
Expected volatility	39.1		%	39.1		%
Risk-free interest rate	0.3		%	0.3		%
Expected term (years)	2.53			2.53
Weighted-average fair value	$	45.70		$	45.03

Expected volatility is based on the historical volatility of our common stock for the related expected term. We believe this approach is reflective of current and historical market conditions and is an appropriate indicator of expected volatility. The risk-free interest rate is the rate available as of the award date on zero-coupon U.S. government issues with a term equal to the expected term of the award. The expected term is the term of an award based on the period of time between the date of the award and the date the award is expected to vest. The expected term assumption is based upon the plan's performance period as of the date of the award. We have not paid dividends in the past and do not plan to pay dividends in the foreseeable future.

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The following table summarizes restricted stock unit activity for the six months ended June 30:

	Number of Restricted Stock Units		Weighted Average  Grant Date Fair Value		Aggregate Intrinsic Value(1)
	(in thousands)				(in thousands)
Outstanding, January 1, 2012	625
Granted(2)	443		$	47.33
Released	(176	)			$	11,536
Forfeited	(28	)
Outstanding, June 30, 2012	864
Outstanding, January 1, 2013	774
Granted(2)	255		$	42.51
Released	(253	)			$	13,562
Forfeited	(11	)
Outstanding, June 30, 2013	765
Vested but not released, June 30, 2013	29				$	1,244
Expected to vest, June 30, 2013	672				$	28,496

⁽¹⁾  The aggregate intrinsic value is the market value of the stock, before applicable income taxes, based on the closing price on the stock release dates or at the end of the period for restricted stock units expected to vest.

⁽²⁾  Restricted stock units granted in 2012 and 2013 do not include awards under the Performance Award Agreement for the respective years, as these awards are not granted until final attainment of performance goals has been determined at the conclusion of the performance period, which had not occurred as of June 30, 2012 and 2013, respectively.

At June 30, 2013, unrecognized compensation expense on restricted stock units was $24.2 million, which is expected to be recognized over a weighted average period of approximately 1.9 years.

Unrestricted Stock Awards

We grant unrestricted stock awards to members of our Board of Directors as part of their compensation. Awards are fully vested and expensed when granted. The fair value of unrestricted stock awards is the market close price of our common stock on the date of grant.

The following table summarizes unrestricted stock award activity for the three and six months ended June 30:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Shares of unrestricted stock granted	4,518		4,526		8,847		9,979
Weighted average grant date fair value per share	$	45.37	$	45.26	$	45.40	$	41.05

Employee Stock Purchase Plan

Under the terms of the ESPP, employees can deduct up to 10% of their regular cash compensation to purchase our common stock at a 15% discount from the fair market value of the stock at the end of each fiscal quarter, subject to other limitations under the plan. The sale of the stock to the employees occurs at the beginning of the subsequent quarter.

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The following table summarizes ESPP activity for the three and six months ended June 30:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Shares of stock sold to employees(1)	27,489		30,619		47,308		53,676
Weighted average fair value per ESPP award(2)	$	6.37	$	6.19	$	6.69	$	6.55

⁽¹⁾  Stock sold to employees during each fiscal quarter under the ESPP is associated with the offering period ending on the last day of the previous fiscal quarter.

⁽²⁾  Relating to awards associated with the offering period during the three and six months ended June 30.

At June 30, 2013, all compensation cost associated with the ESPP had been recognized. There were approximately 553,000 shares of common stock available for future issuance under the ESPP at June 30, 2013.

Note 10:    Income Taxes

Our tax provisions as a percentage of income (loss) before tax typically differ from the federal statutory rate of 35%, and may vary from period to period, due to fluctuations in the forecasted mix of earnings in domestic and international jurisdictions, new or revised tax legislation and accounting pronouncements, tax credits, state income taxes, adjustments to valuation allowances, and uncertain tax positions, among other items.

Our tax benefit for the first six months of 2013 reflects the favorable discrete tax benefit for the retroactive extension of the 2012 research and experimentation credit in the amount of $4.0 million. The American Taxpayer Relief Act of 2012 was signed into law on January 2, 2013 and extended several business tax provisions including the research and experimentation credit. Our annual estimated effective tax rate for 2013 was favorably impacted by a higher percentage of projected earnings in foreign jurisdictions with tax rates below 35%, the benefit of certain interest expense deductions, and an election under U.S. Internal Revenue Code Section 338 with respect to a foreign acquisition in 2007.  Accordingly, our 2013 annual estimated effective tax rate is lower than our 2012 annual estimated effective tax rate.

Our tax provision in 2012 was lower than the federal statutory rate of 35% due to projected earnings in tax jurisdictions with rates lower than 35%, the benefit of certain interest expense deductions, and an election under U.S. Internal Revenue Code Section 338 with respect to a foreign acquisition in 2007.

We classify interest expense and penalties related to unrecognized tax liabilities and interest income on tax overpayments as components of income tax expense. The net interest and penalties expense recognized is as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
	(in thousands)
Net interest and penalties expense	$	168	$	(22	)	$	339	$	265

Accrued interest and penalties recorded are as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Accrued interest	$	3,251	$	3,095
Accrued penalties	3,009		3,030

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Unrecognized tax benefits related to uncertain tax positions and the amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate are as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Unrecognized tax benefits related to uncertain tax positions	$	26,853	$	26,433
The amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate	26,141		25,852

We believe it is reasonably possible that our unrecognized tax benefits may decrease by approximately $1.3 million within the next twelve months due to the expiration of the statute of limitations. At June 30, 2013, we are not able to reasonably estimate the timing of future cash flows relating to our uncertain tax positions.

Note 11:    Commitments and Contingencies

Guarantees and Indemnifications

We are often required to obtain standby letters of credit (LOCs) or bonds in support of our obligations for customer contracts. These standby LOCs or bonds typically provide a guarantee to the customer for future performance, which usually covers the installation phase of a contract and may, on occasion, cover the operations and maintenance phase of outsourcing contracts.

Our available lines of credit, outstanding standby LOCs, and bonds are as follows:

	June 30, 2013			December 31, 2012
	(in thousands)
Credit facilities(1)
Multicurrency revolving line of credit	$	660,000		$	660,000
Long-term borrowings	(140,000		)	(140,000		)
Standby LOCs issued and outstanding	(47,037		)	(54,328		)
Net available for additional borrowings and LOCs	$	472,963		$	465,672
Unsecured multicurrency revolving lines of credit with various financial institutions
Multicurrency revolving lines of credit	$	97,456		$	67,308
Standby LOCs issued and outstanding	(29,581		)	(29,906		)
Short-term borrowings(2)	(2,731		)	(851		)
Net available for additional borrowings and LOCs	$	65,144		$	36,551
Unsecured surety bonds in force	$	136,934		$	164,820

⁽¹⁾  See Note 6 for details regarding our secured credit facilities.

⁽²⁾  Short-term borrowings are included in "Other current liabilities" on the Consolidated Balance Sheets.

In the event any such standby LOC or bond is called, we would be obligated to reimburse the issuer of the standby LOC or bond; however, we do not believe that any outstanding LOC or bond will be called.

We generally provide an indemnification related to the infringement of any patent, copyright, trademark, or other intellectual property right on software or equipment within our sales contracts, which indemnifies the customer from and pays the resulting costs, damages, and attorney’s fees awarded against a customer with respect to such a claim provided that (a) the customer promptly notifies us in writing of the claim and (b) we have the sole control of the defense and all related settlement negotiations. We may also provide an indemnification to our customers for third party claims resulting from damages caused by the negligence or willful misconduct of our employees/agents in connection with the performance of certain contracts. The terms of our indemnifications generally do not limit the maximum potential payments. It is not possible to predict the maximum potential amount of future payments under these or similar agreements.

Legal Matters

We are subject to various legal proceedings and claims of which the outcomes are subject to significant uncertainty. Our policy is to assess the likelihood of any adverse judgments or outcomes related to legal matters, as well as ranges of probable losses. A determination of the amount of the liability required, if any, for these contingencies is made after an analysis of each known issue.

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A liability is recorded and charged to operating expense when we determine that a loss is probable and the amount can be reasonably estimated. Additionally, we disclose contingencies for which a material loss is reasonably possible, but not probable. Liabilities recorded for legal contingencies at June 30, 2013 were not material to our financial condition or results of operations.

In 2010 and 2011, Transdata Incorporated (Transdata) filed lawsuits against four of our customers, CenterPoint Energy (CenterPoint), TriCounty Electric Cooperative, Inc. (Tri-County), San Diego Gas & Electric Company (San Diego), and Texas-New Mexico Power Company (TNMP), as well as several other utilities, alleging infringement of three patents owned by Transdata related to the use of an antenna in a meter. Pursuant to our contractual obligations with our customers, we agreed, subject to certain exceptions, to indemnify and defend them in these lawsuits. The complaints seek unspecified damages as well as injunctive relief. CenterPoint, Tri-County, San Diego, and TNMP have denied all of the substantive allegations and filed counterclaims seeking a declaratory judgment that the patents are invalid and not infringed. In December 2011, the Judicial Panel on Multi-District Litigation consolidated all of these cases in the Western District of Oklahoma for pretrial proceedings. On April 17, 2011, the Oklahoma court stayed the litigation pending the resolution of re-examination proceedings in the United States Patent and Trademark Office (U.S. PTO). The U.S. PTO has issued re-examination certificates confirming the patentability of the original claims and allowing certain new claims added by TransData. The parties conducted a claim construction hearing on February 5, 2013 on one claim term -- "electric meter circuitry." After initially adopting defendants' proposed construction of the term, the Court granted TransData's motion for reconsideration by order of June 25, 2013, and has adopted TransData's proposed construction. A claim construction hearing on the remaining terms is scheduled for late September 2013. Most of the remaining deadlines are based on the date of the Court's decision relating to those remaining terms. No trials are scheduled. We do not believe this matter will have a material adverse effect on our business or financial condition, although an unfavorable outcome could have a material adverse effect on our results of operations for the period in which such a loss is recognized.

In June 2011, a lawsuit was filed in the United States District Court for the Eastern District of Texas alleging infringement of three patents owned by EON Corp. IP Holdings, LLC (EON), related to two-way communication networks, network components, and related software platforms. The complaint seeks unspecified damages as well as injunctive relief. The Court has construed key terms of the three patents and has granted requests to file motions for summary judgment. We do not believe this matter will have a material adverse effect on our business or financial condition.

In a series of cases, approximately 270 former employees of Itron Sistemas e Technologia Ltda. (Itron Brazil), the majority of whose employment contracts were terminated in 2011, have sued Itron Brazil seeking payment of overtime and salary differential and alleging that the assumption of the employment relationship by Itron Brazil constituted illegal outsourcing under Brazilian law. In 2008, Itron Brazil entered into an agreement to provide installation and maintenance services to one of its customers and, to perform such services, hired over 800 employees of the previous provider of such services. In 2011, Itron Brazil determined to terminate the contract with its customer, which led to the termination of approximately 870 employees. Under applicable statutes of limitation, most additional employee claims must be brought prior to October 31, 2013. Itron Brazil intends to vigorously defend these cases but the ultimate outcome of the cases, and the amount of any liability, cannot be determined at this time.

The Company and its subsidiaries are parties to various employment-related proceedings in jurisdictions where it does business. None of the proceedings are individually material to the Company, and management believes that the Company has made adequate provision such that the ultimate disposition of the proceedings will not materially affect the Company's business or financial condition.

Warranty

A summary of the warranty accrual account activity is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Beginning balance	$	50,754		$	77,251		$	53,605		$	79,536
New product warranties	1,961			3,507			2,822			5,636
Other changes/adjustments to warranties	3,611			(3,770		)	5,638			2,061
Claims activity	(5,289		)	(8,255		)	(10,388		)	(19,575		)
Effect of change in exchange rates	(405		)	(2,365		)	(1,045		)	(1,290		)
Ending balance	50,632			66,368			50,632			66,368
Less: current portion of warranty	24,709			42,861			24,709			42,861
Long-term warranty	$	25,923		$	23,507		$	25,923		$	23,507

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Total warranty expense is classified within cost of revenues and consists of new product warranties issued, costs related to extended warranty contracts, and other changes and adjustments to warranties. Warranty expense for the three and six months ended June 30 is as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
	(in thousands)
Total warranty expense	$	5,572	$	(263	)	$	8,460	$	7,697

Warranty expense increased during the three and six months ended June 30, 2013, compared with the same periods in 2012. Warranty expense during the three and six months ended June 30, 2012 reflected a $4.3 million adjustment, which reduced a warranty accrual, originally recorded in 2011, as a result of lower than estimated replacements.

Unearned Revenue Related to Extended Warranty

A summary of changes to unearned revenue for extended warranty contracts is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Beginning balance	$	32,363		$	27,140		$	31,960		$	24,448
Unearned revenue for new extended warranties	1,664			2,243			2,625			5,189
Unearned revenue recognized	(525		)	(331		)	(995		)	(631		)
Effect of change in exchange rates	(107		)	(41		)	(195		)	5
Ending balance	33,395			29,011			33,395			29,011
Less: current portion of unearned revenue for extended warranty	2,472			1,572			2,472			1,572
Long-term unearned revenue for extended warranty within Other long-term obligations	$	30,923		$	27,439		$	30,923		$	27,439

Health Benefits

We are self insured for a substantial portion of the cost of our U.S. employee group health insurance. We purchase insurance from a third party, which provides individual and aggregate stop-loss protection for these costs. Each reporting period, we expense the costs of our health insurance plan including paid claims, the change in the estimate of incurred but not reported (IBNR) claims, taxes, and administrative fees (collectively, the plan costs).

Plan costs are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Plan costs	$	5,662	$	7,217	$	10,500	$	12,878

The IBNR accrual, which is included in wages and benefits payable, is as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
IBNR accrual	$	2,345	$	2,552

Our IBNR accrual and expenses may fluctuate due to the number of plan participants, claims activity, and deductible limits. For our employees located outside of the United States, health benefits are provided primarily through governmental social plans, which are funded through employee and employer tax withholdings.

27

Note 12:     Restructuring

During the fourth quarter of 2011, we announced the approval of projects to restructure our manufacturing operations to increase efficiency and lower our cost of manufacturing. We began implementing these projects in the fourth quarter of 2011.

As of June 30, 2013, we have substantially completed these restructuring projects. We do not anticipate substantial expenses related to these restructuring projects to be recognized in the Consolidated Statements of Operations in future periods.

The total expected restructuring costs, the costs recognized in prior periods, the restructuring costs recognized during the six months ended June 30, 2013, and the remaining expected restructuring costs as of June 30, 2013 are as follows:

	Total Expected Costs at  June 30, 2013		Costs Recognized in Prior Periods		Costs Recognized During the Six Months Ended June 30, 2013		Remaining Costs to be Recognized at June 30, 2013 (1)
	(in thousands)
Employee severance costs	$	46,850	$	44,196	$	2,654	$	—
Asset impairments	20,332		20,305		27		—
Other restructuring costs	6,963		5,246		1,717		—
Total	$	74,145	$	69,747	$	4,398	$	—
Segments:
Energy	$	53,385	$	53,190	$	195	$	—
Water	15,675		14,556		1,119		—
Corporate unallocated	5,085		2,001		3,084		—
Total	$	74,145	$	69,747	$	4,398	$	—

⁽¹⁾ There are no significant restructuring costs expected to be incurred after June 30, 2013 for these restructuring projects.

Other restructuring costs include expenses to exit the facilities once the operations in those facilities have ceased. Costs associated with restructuring activities are generally presented as restructuring expense in the Consolidated Statements of Operations, except for certain costs associated with inventory write-downs, which are classified within cost of revenues, and accelerated depreciation expense, which is recognized according to the use of the asset.

The following table summarizes the activity within the restructuring related balance sheet accounts during the six months ended June 30, 2013:

	Accrued Employee Severance			Asset Impairments & Net Loss on Sale or Disposal			Other Accrued Costs			Total
	(in thousands)
Beginning balance, January 1, 2013	$	14,498		$	—		$	3,216		$	17,714
Costs incurred and charged to expense	2,654			27			1,717			4,398
Cash payments	(3,155		)	—			(833		)	(3,988		)
Non-cash items	—			(27		)	—			(27		)
Effect of change in exchange rates	(447		)	—			(28		)	(475		)
Ending balance, June 30, 2013	$	13,550		$	—		$	4,072		$	17,622

The current portions of the restructuring related liability balances were $13.9 million and $13.2 million as of June 30, 2013 and December 31, 2012, respectively. The current portion of the liability is classified within "Other current liabilities" on the Consolidated Balance Sheets. The long-term portions of the restructuring related liability related balances were $3.7 million and $4.5 million as of June 30, 2013 and December 31, 2012, respectively. The long-term portion of the restructuring liability is classified within "Other long-term liabilities" on the Consolidated Balance Sheets.

Asset impairments are determined at the asset group level. Assets held for sale are classified within other current assets and are reported at the lower of the carrying amount or the fair value, less costs to sell, and are no longer depreciated or amortized.

28

The following table includes assets that were measured at fair value on a nonrecurring basis as of June 30, 2013 and December 31, 2012, and the related losses recognized during the period:

	Net Carrying Value		Fair Value Measurement (Level 3)		Total Loss Recognized in Period
	(in thousands)
June 30, 2013
Long-lived assets held for sale	$	3,128	$	3,128	$	—
December 31, 2012
Long-lived assets held for sale	$	3,184	$	3,184	$	2

The fair values of the disposal groups included in long-lived assets held for sale were determined based on the estimated proceeds from their expected sales, net of estimated selling costs. Long-lived assets held for sale at June 30, 2013 and December 31, 2012 consist of one asset group that includes land, a building, and building improvements.

Revenues and net operating income from the activities we have exited or will exit under the restructuring plan are not material to our operating segments or consolidated results.

Note 13:    Other Comprehensive Income (Loss)

OCI is reflected as a net increase (decrease) to Itron, Inc. shareholders’ equity and is not reflected in our results of operations. The before-tax amount, income tax (provision) benefit, and net-of-tax amount related to each component of other comprehensive income (loss) during the reporting periods were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Before-tax amount
Foreign currency translation adjustment	$	6,798		$	(52,847	)	$	(20,649	)	$	(24,145	)
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	1,336			(1,365		)	1,244			(1,365		)
Pension plan benefits liability adjustment	263			19			(283		)	38
Total other comprehensive income (loss), before tax	8,397			(54,193		)	(19,688		)	(25,472		)
Tax (provision) benefit
Foreign currency translation adjustment	377			476			(3,471		)	315
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	(491		)	516			(472		)	516
Pension plan benefits liability adjustment	(80		)	3			86			7
Total other comprehensive income (loss) tax (provision) benefit	(194		)	995			(3,857		)	838
Net-of-tax amount
Foreign currency translation adjustment	7,175			(52,371		)	(24,120		)	(23,830		)
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	845			(849		)	772			(849		)
Pension plan benefits liability adjustment	183			22			(197		)	45
Total other comprehensive income (loss), net of tax	$	8,203		$	(53,198	)	$	(23,545	)	$	(24,634	)

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The changes in the components of accumulated other comprehensive income (loss) (AOCI), net of tax, were as follows:

	Foreign Currency Translation Adjustments			Net Unrealized Gain (Loss) on Derivative Instruments			Net Unrealized Gain (Loss) on Nonderivative Instruments			Pension Plan Benefit Liability Adjustments			Total
	(in thousands)
Balances at January 1, 2012	$	(24,718	)	$	—		$	(14,380	)	$	1,938		$	(37,160	)
OCI before reclassifications	(23,830		)	(849		)	—			—			(24,679		)
Amounts reclassified from AOCI	—			—			—			45			45
Total other comprehensive income (loss)	(23,830		)	(849		)	—			45			(24,634		)
Balances at June 30, 2012	$	(48,548	)	$	(849	)	$	(14,380	)	$	1,983		$	(61,794	)
Balances at January 1, 2013	$	(3,313	)	$	(1,689	)	$	(14,380	)	$	(15,002	)	$	(34,384	)
OCI before reclassifications	(24,120		)	772			—			(566		)	(23,914		)
Amounts reclassified from AOCI	—			—			—			369			369
Total other comprehensive income (loss)	(24,120		)	772			—			(197		)	(23,545		)
Balances at June 30, 2013	$	(27,433	)	$	(917	)	$	(14,380	)	$	(15,199	)	$	(57,929	)

Details about the AOCI components reclassified to the Consolidated Statements of Operations during the reporting periods are as follows:

	Amount Reclassified from AOCI(1)
	Three Months Ended June 30,						Six Months Ended June 30,						Affected Line Item in the Income Statement
	2013			2012			2013			2012
	(in thousands)
Amortization of defined benefit pension items
Prior-service costs	$	(17	)	$	(17	)	(34		)	(34		)	(2)
Actuarial losses	(246		)	(2		)	(497		)	(4		)	(2)
Total, before tax	(263		)	(19		)	(531		)	(38		)	Income before income taxes
Tax benefit (provision)	80			(3		)	162			(7		)	Income tax provision
Total, net of tax	(183		)	(22		)	(369		)	(45		)	Net income
Total reclassifications for the period, net of tax	$	(183	)	$	(22	)	$	(369	)	$	(45	)	Net income

⁽¹⁾ Amounts in parenthesis indicate debits to the Statements of Operations.

⁽²⁾  These AOCI components are included in the computation of net periodic pension cost. Refer to Note 8 for additional details.

30

Note 14:    Fair Values of Financial Instruments

The fair values at June 30, 2013 and December 31, 2012 do not reflect subsequent changes in the economy, interest rates, and other variables that may affect the determination of fair value.

	June 30, 2013				December 31, 2012
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
			(in thousands)
Assets
Cash and cash equivalents	$	103,662	$	103,662	$	136,411	$	136,411
Foreign exchange forwards	122		122		146		146
Liabilities
Credit facility
USD denominated term loan	$	270,000	$	268,219	$	277,500	$	275,365
Multicurrency revolving line of credit	140,000		138,930		140,000		138,751
Interest rate swaps	1,482		1,482		2,725		2,725
Foreign exchange forwards	108		108		114		114

The following methods and assumptions were used in estimating fair values:

Cash and cash equivalents: Due to the liquid nature of these instruments, the carrying value approximates fair value (Level 1).

Credit facility - term loan and multicurrency revolving line of credit: The term loan and revolver are not traded publicly. The fair values, which are valued based upon a hypothetical market participant, are calculated using a discounted cash flow model with Level 2 inputs, including estimates of incremental borrowing rates for debt with similar terms, maturities, and credit profiles. Refer to Note 6 for a further discussion of our debt.

Derivatives: See Note 7 for a description of our methods and assumptions in determining the fair value of our derivatives, which were determined using Level 2 inputs.

Note 15:    Segment Information

We operate under the Itron brand worldwide and manage and report under two operating segments, Energy and Water. The Energy operating segment includes our global electricity and gas businesses, while the Water operating segment includes our global water and heat businesses.

On March 27, 2013, we separated the management of our Energy operating segment into Electricity and Gas to allow each business line to develop its own go-to-market strategy, prioritize its marketing and product development requirements, and focus on its strategic investments. As a result, our sales, marketing, and delivery function are managed under three business lines - Electricity, Gas, and Water. At the same time, product development and operations were centralized and are managed on a global basis. Although most management positions of the new business lines have been identified, the transition to the new organizational structure is ongoing, and we are continuing to assess the implications to our operating segments and our operational and financial reporting systems.

We have three measures of segment performance: revenue, gross profit (margin), and operating income (margin). Our operating segments have distinct products, and therefore intersegment revenues are minimal. Corporate operating expenses, interest income, interest expense, other income (expense), and income tax provision (benefit) are not allocated to the segments, nor included in the measure of segment profit or loss. In addition, we allocate only certain production assets and intangible assets to our operating segments. We do not manage the performance of the segments on a balance sheet basis.

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Segment Products

Energy

Standard electricity (electromechanical and electronic) and gas meters; advanced electricity and gas meters and communication modules; smart electricity meters; smart electricity and gas communication modules; prepayment systems, including smart key, keypad, and smart card communication technologies; advanced systems including handheld, mobile, and fixed network collection technologies; smart network technologies; meter data management software; knowledge application solutions; and professional services including implementation, installation, consulting, and analysis.

Water

Standard water and heat meters; advanced and smart water meters and communication modules; advanced systems including handheld, mobile, and fixed network collection technologies; meter data management software; knowledge application solutions; and professional services including implementation, installation, consulting, analysis, and system management.

Revenues, gross profit, and operating income associated with our segments were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Revenues
Energy	$	349,623		$	444,598		$	662,301		$	882,345
Water	132,552			134,542			267,410			268,435
Total Company	$	482,175		$	579,140		$	929,711		$	1,150,780
Gross profit
Energy	$	112,673		$	148,951		$	208,227		$	283,554
Water	46,915			47,794			91,484			96,296
Total Company	$	159,588		$	196,745		$	299,711		$	379,850
Operating income (loss)
Energy	$	14,764		$	47,069		$	15,244		$	85,233
Water	15,389			11,666			27,964			27,603
Corporate unallocated	(12,177		)	(12,672		)	(22,885		)	(27,152		)
Total Company	17,976			46,063			20,323			85,684
Total other income (expense)	(3,884		)	(3,208		)	(5,978		)	(7,628		)
Income before income taxes	$	14,092		$	42,855		$	14,345		$	78,056

For the three and six months ended June 30, 2013, no single customer represented more than 10% of the total Company, the Energy operating segment, or the Water operating segment revenues.

For the three and six months ended June 30, 2012, one customer from the Energy operating segment accounted for 11% of the total Company revenues. During the same periods, one customer accounted for 15% of the Energy operating segment revenues, and no single customer accounted for more than 10% of the Water operating segment revenues.

Revenues by region were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
United States and Canada	$	211,565	$	292,999	$	388,771	$	577,586
Europe, Middle East, and Africa	215,250		215,899		427,145		436,855
Other	55,360		70,242		113,795		136,339
Total revenues	$	482,175	$	579,140	$	929,711	$	1,150,780

32

Depreciation and amortization expense associated with our segments was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Energy	$	18,348	$	20,488	$	36,819	$	41,144
Water	5,909		6,539		12,178		13,095
Corporate Unallocated	17		17		34		32
Total Company	$	24,274	$	27,044	$	49,031	$	54,271

Note 16:    Subsequent Event

Stock Repurchases

Subsequent to June 30, 2013, we repurchased 174,200 shares of our common stock under the stock repurchase program authorized by the Board of Directors on March 8, 2013. The average price paid per share was $42.71.

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ITEM 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations

In this Quarterly Report on Form 10-Q, the terms “we,” “us,” “our,” “Itron,” and the “Company” refer to Itron, Inc.

The following discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements and notes included in this report and with our Annual Report on Form 10-K for the year ended December 31, 2012, filed with the Securities and Exchange Commission (SEC) on February 22, 2013.

Documents we provide to the SEC are available free of charge under the Investors section of our website at www.itron.com as soon as practicable after they are filed with or furnished to the SEC. In addition, these documents are available at the SEC’s website (http://www.sec.gov) and at the SEC’s Headquarters at 100 F Street, NE, Washington, DC 20549, or by calling 1-800-SEC-0330.

Certain Forward-Looking Statements

This document contains forward-looking statements concerning our operations, financial performance, revenues, earnings growth, liquidity, and other items. This document reflects our current plans and expectations and is based on information currently available as of the date of this Quarterly Report on Form 10-Q. When we use the words “expect,” “intend,” “anticipate,” “believe,” “plan,” “project,” “estimate,” “future,” “objective,” “may,” “will,” “will continue,” and similar expressions, they are intended to identify forward-looking statements. Forward-looking statements rely on a number of assumptions and estimates. These assumptions and estimates could be inaccurate and cause our actual results to vary materially from expected results. Risks and uncertainties include 1) the rate and timing of customer demand for our products, 2) rescheduling or cancellations of current customer orders and commitments, 3) changes in estimated liabilities for product warranties and/or litigation, 4) our dependence on customers' acceptance of new products and their performance, 5) competition, 6) changes in domestic and international laws and regulations, 7) changes in foreign currency exchange rates and interest rates, 8) international business risks, 9) our own and our customers' or suppliers' access to and cost of capital, 10) future business combinations, and 11) other factors. You should not solely rely on these forward-looking statements as they are only valid as of the date of this Quarterly Report on Form 10-Q. We do not have any obligation to publicly update or revise any forward-looking statement in this document. For a more complete description of these and other risks, refer to Item 1A: “Risk Factors” included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, which was filed with the SEC on February 22, 2013.

Results of Operations

We are a technology company, offering end-to-end smart metering solutions to electric, natural gas, and water utilities around the world. Our smart metering solutions, meter data management software, and knowledge application solutions bring additional value to a utility’s metering and grid systems. Our professional services help our customers project-manage, install, implement, operate, and maintain their systems.

We have two operating segments. The Energy operating segment includes our global electricity and gas products, while the Water operating segment includes our global water and heat products.

On March 27, 2013, we separated the management of our Energy operating segment into Electricity and Gas to allow each business line to develop its own go-to-market strategy, prioritize its marketing and product development requirements, and focus on its strategic investments. As a result, our sales, marketing, and delivery function are managed under three business lines - Electricity, Gas, and Water. At the same time, product development and operations were centralized and are managed on a global basis. Although most management positions of the new business lines have been identified, the transition to the new organizational structure is ongoing, and we are continuing to assess the implications to our operating segments and our operational and financial reporting systems.

We have three measures of segment performance: revenue, gross profit (margin), and operating income (margin). Intersegment revenues were minimal. Corporate operating expenses, interest income, interest expense, other income (expense), and income tax provision (benefit) are not allocated to the segments, nor included in the measure of segment profit or loss. In addition, we allocate only certain production assets and intangible assets to our operating segments. We do not manage the performance of the segments on a balance sheet basis.

34

Overview

Revenues for the three and six months ended June 30, 2013 were $482 million and $930 million, compared with $579 million and $1.2 billion in the same periods last year. The decrease in 2013 was the result of significantly lower revenues in the Energy segment. Gross margins for the three and six months ended June 30, 2013 were 33.1% and 32.2%, compared with gross margins of 34.0% and 33.0% for the same periods in 2012. In 2013, lower volumes and increased warranty costs, as the result of a $4.3 million warranty accrual reduction recognized in the second quarter of 2012, had a negative impact on gross margin.

Our tax benefit for the first six months of 2013 reflects the favorable discrete tax benefit for the retroactive extension of the 2012 research and experimentation credit in the amount of $4.0 million. The American Taxpayer Relief Act of 2012 was signed into law on January 2, 2013 and extended several business tax provisions including the research and experimentation credit. Our annual estimated effective tax rate for 2013 was favorably impacted by a higher percentage of projected earnings in foreign jurisdictions with tax rates below 35%, the benefit of certain interest expense deductions, and an election under U.S. Internal Revenue Code Section 338 with respect to a foreign acquisition in 2007.  Accordingly, our 2013 annual estimated effective tax rate is lower than our 2012 annual estimated effective tax rate. During the three and six months ended June 30, 2012, we had tax provisions of 24.7% and 25.9%, based on a percentage of income before tax, which included minimal discrete benefits.

Total backlog was $1.1 billion and twelve-month backlog was $558 million at June 30, 2013.

On March 8, 2013, our Board of Directors authorized a twelve-month repurchase program of up to $50 million of our common stock. During the three months ended June 30, 2013, we repurchased 380,310 shares of our common stock for $15.9 million. Subsequent to June 30, 2013, we repurchased 174,200 shares of our common stock for $7.4 million.

Total Company Revenues, Gross Profit and Margin, and Unit Shipments

	Three Months Ended June 30,							Six Months Ended June 30,
	2013			2012			% Change	2013			2012			% Change
	(in thousands)							(in thousands)
Revenues	$	482,175		$	579,140		(17)%	$	929,711		$	1,150,780		(19)%
Gross Profit	$	159,588		$	196,745		(19)%	$	299,711		$	379,850		(21)%
Gross Margin	33.1		%	34.0		%		32.2		%	33.0		%

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Revenues by Region
United States and Canada (North America)	$	211,565	$	292,999	$	388,771	$	577,586
Europe, Middle East, and Africa (EMEA)	215,250		215,899		427,145		436,855
Other	55,360		70,242		113,795		136,339
Total revenues	$	482,175	$	579,140	$	929,711	$	1,150,780

Revenues

Revenues decreased $97.0 million and $221.1 million, or 17% and 19%, for the three and six months ended June 30, 2013, compared with the same periods in 2012. This decrease was driven by the Energy segment and reflected the impact of the substantial completion of four of our five largest OpenWay projects in 2012 combined with lower gas revenues in North America, EMEA, and Asia/Pacific. Water revenues were essentially flat. A more detailed analysis of these fluctuations is provided in Operating Segment Results.

No single customer accounted for more than 10% of total Company revenues during the three and six months ended June 30, 2013, while one customer, BC Hydro and Power Authority, accounted for 11% of total Company revenues during the same periods in 2012. Our 10 largest customers accounted for 22% and 20% of total revenues during the three and six months ended June 30, 2013, and 30% and 32% for the three and six months ended June 30, 2012, respectively.

35

Gross Margins

Gross margin for the second quarter of 2013 was 33.1%, compared with 34.0% for the same period in 2012. For the six months ended June 30, 2013, gross margin was 32.2%, compared with 33.0% in the same period in 2012. The decline over the prior year was due primarily to lower volumes and higher warranty costs, as the result of a $4.3 million warranty accrual reduction recognized in the second quarter of 2012, partially offset by benefits from manufacturing efficiencies in the Energy operating segment. In addition, the Water operating segment had a negative impact on gross margin as the result of increased professional services in North America, which have a lower gross margin, and less favorable product mix in other regions, which is the result a lower volume of higher margin products as a proportion of total sales. A more detailed analysis of these fluctuations is provided in Operating Segment Results.

Meter and Module Summary

We classify meters into three categories:

• Standard metering – no built-in remote reading communication technology

• Advanced metering – one-way communication of meter data

• Smart metering – two-way communication including remote meter configuration and upgrade (consisting primarily of our OpenWay® technology)

In addition, advanced and smart meter communication modules can be sold separately from the meter. A summary of our meter and communication module shipments is as follows:

	Three Months Ended June 30,		Six Months Ended June 30,
	2013	2012	2013	2012
	(units in thousands)
Meters
Standard	4,730	4,620	9,170	9,500
Advanced and smart	1,340	2,160	2,970	4,410
Total meters	6,070	6,780	12,140	13,910
Stand-alone communication modules
Advanced and smart	1,350	1,960	2,690	3,550

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Operating Segment Results

For a description of our operating segments, refer to Item 1: “Financial Statements Note 15: Segment Information”.

	Three Months Ended June 30,									Six Months Ended June 30,
	2013			2012		% Change				2013			2012		% Change
Segment Revenues	(in thousands)									(in thousands)
Energy
Electricity	$	213,612		$	283,484	(25)%				$	389,375		$	567,944	(31)%
Gas	136,011			161,114		(16)%				272,926			314,401		(13)%
Total Energy	349,623			444,598		(21)%				662,301			882,345		(25)%
Water	132,552			134,542		(1)%				267,410			268,435		—%
Total revenues	$	482,175		$	579,140	(17)%				$	929,711		$	1,150,780	(19)%
	Three Months Ended June 30,									Six Months Ended June 30,
	2013					2012				2013					2012
	Gross Profit			Gross Margin		Gross Profit			Gross Margin	Gross Profit			Gross Margin		Gross Profit			Gross Margin
Segment Gross Profit and Margin	(in thousands)					(in thousands)				(in thousands)					(in thousands)
Energy	$	112,673		32.2%		$	148,951		33.5%	$	208,227		31.4%		$	283,554		32.1%
Water	46,915			35.4%		47,794			35.5%	91,484			34.2%		96,296			35.9%
Total gross profit and margin	$	159,588		33.1%		$	196,745		34.0%	$	299,711		32.2%		$	379,850		33.0%
	Three Months Ended June 30,									Six Months Ended June 30,
	2013					2012				2013					2012
	Operating Income (Loss)			Operating Margin		Operating Income (Loss)			Operating Margin	Operating Income (Loss)			Operating Margin		Operating Income (Loss)			Operating Margin
Segment Operating Income (Loss) and Operating Margin	(in thousands)					(in thousands)				(in thousands)					(in thousands)
Energy	$	14,764		4%		$	47,069		11%	$	15,244		2%		$	85,233		10%
Water	15,389			12%		11,666			9%	27,964			10%		27,603			10%
Corporate unallocated	(12,177		)			(12,672		)		(22,885		)			(27,152		)
Total Company	$	17,976		4%		$	46,063		8%	$	20,323		2%		$	85,684		7%

Energy:

Revenues - Three months ended June 30, 2013 vs. Three months ended June 30, 2012

Electricity revenues decreased $69.9 million, or 25%, for the three months ended June 30, 2013, compared with the same period in 2012. Revenues in 2013 were lower primarily due to $97.7 million in scheduled decreases in our five largest OpenWay projects in North America and $9.2 million in decreased meter shipments in Asia/Pacific. These decreases were partially offset by $22.8 million in increased revenues from sources other than the five largest OpenWay projects in North America and $16.9 million in higher product shipments and services in EMEA, of which $8.8 million was in South Africa.

Gas revenues decreased $25.1 million, or 16%, for the three months ended June 30, 2013, compared with the same period in 2012, primarily as the result of $16.3 million in lower product sales in EMEA and $6.3 million in lower product sales and services in North America.

Revenues - Six months ended June 30, 2013 vs. Six months ended June 30, 2012

Electricity revenues decreased $178.6 million, or 31%, for the six months ended June 30, 2013, compared with the same period in 2012. Revenues in 2013 were lower primarily due to $219.1 million in scheduled decreases in our five largest OpenWay projects in North America, $8.2 million in decreased meter shipments in Asia/Pacific, and $6.5 million in decreased product shipments in Latin America. These decreases were partially offset by $37.9 million in increased revenues from sources other than the five largest OpenWay projects in North America and $17.4 million in EMEA.

Gas revenues decreased $41.5 million, or 13%, for the six months ended June 30, 2013, compared with the same period in 2012, primarily as the result of $26.4 million in lower product sales in EMEA and $11.3 million in lower product sales and services in North America. Revenues in Latin America and Asia/Pacific were lower, as well.

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No single customer accounted for more than 10% of the Energy operating segment revenues during the three and six months ended June 30, 2013, while one customer accounted for more than 10% of the Energy operating segment revenues during the same periods of 2012.

Gross Margin - Three months ended June 30, 2013 vs. Three months ended June 30, 2012

Energy gross margin was 32.2% for the three months ended June 30, 2013, compared with 33.5% for the same period in 2012. During the second quarter of 2013, gross margin decreased 1.3% over the prior year, primarily as the result of lower volumes and higher warranty expense. In the second quarter of 2012, we recognized a $4.3 million adjustment, which reduced a warranty accrual, originally recorded in 2011, as a result of lower than estimated replacements. These decreases were partially offset by the benefits from efficiencies from our restructuring projects.

Gross Margin - Six months ended June 30, 2013 vs. Six months ended June 30, 2012

Energy gross margin was 31.4% for the six months ended June 30, 2013, compared with 32.1% for the same period in 2012. During the first half of 2013, gross margin decreased 0.7% over the prior year as benefits from efficiencies from our restructuring projects were more than offset by higher warranty costs and the impact of lower volumes. In the second quarter of 2012, we recognized a $4.3 million adjustment, which reduced a warranty accrual, originally recorded in 2011, as a result of lower than estimated replacements.

Operating Expenses - Three months ended June 30, 2013 vs. Three months ended June 30, 2012

Energy operating expenses decreased $4.0 million, or 3.9%, for the three months ended June 30, 2013, compared with the same period in 2012, primarily due to lower sales and marketing and product development, as well as a scheduled decrease in amortization of intangible assets of $1.1 million. These decreases were partially offset by $4.6 million in higher legal reserve costs, which are included within general and administrative expenses. Operating expenses as a percentage of revenues were 28% for the three months ended June 30, 2013, compared with 23% for the same period in 2012.

Operating Expenses - Six months ended June 30, 2013 vs. Six months ended June 30, 2012

Energy operating expenses decreased $5.3 million, or 2.7%, for the six months ended June 30, 2013, compared with the same period in 2012, primarily due to lower sales and marketing and product development costs, as well as a scheduled decrease in amortization of intangible assets of $1.7 million. These decreases were partially offset by $6.6 million in higher legal reserve costs, which are included within general and administrative expenses. Operating expenses as a percentage of revenues were 29% for the six months ended June 30, 2013, compared with 22% for the same period in 2012.

Water:

Revenues - Three months ended June 30, 2013 vs. Three months ended June 30, 2012

Revenues decreased $2.0 million, or 1%, for the three months ended June 30, 2013, compared with the same period last year. This decrease was the result of lower product shipments in Asia/Pacific of $2.6 million and EMEA by $1.2 million, partially offset by $2.1 million in higher volumes in Latin America.

Revenues - Six months ended June 30, 2013 vs. Six months ended June 30, 2012

Revenues decreased $1.0 million for the six months ended June 30, 2013, compared with the same period last year. The decrease was driven primarily by $3.2 million in lower product shipments in Asia/Pacific, partially offset by higher service revenues in North America.

No single customer represented more than 10% of the Water operating segment revenues during the three and six months ended June 30, 2013 and 2012.

Gross Margin - Three months ended June 30, 2013 vs. Three months ended June 30, 2012

Water gross margin decreased to 35.4% for the three months ended June 30, 2013, compared with 35.5% for the same period last year, primarily as a result of an increase in professional services in North America, which have a lower gross margin, offset by the benefit of higher volumes in Latin America.

Gross Margin - Six months ended June 30, 2013 vs. Six months ended June 30, 2012

Water gross margin decreased to 34.2% for the six months ended June 30, 2013, compared with 35.9% for the same period last year, primarily as a result of an increase in professional services in North America, which have a lower gross margin, and unfavorable product mix in other regions.

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Operating Expenses - Three months ended June 30, 2013 vs. Three months ended June 30, 2012

Operating expenses for the three months ended June 30, 2013 decreased by $4.6 million over the second quarter of 2012, primarily as the result of $3.6 million in lower restructuring expenses and lower sales and marketing costs and scheduled decreases in amortization of intangible assets. Operating expenses as a percentage of revenues were 24% for the three months ended June 30, 2013, compared with 27% for the same period in 2012.

Operating Expenses - Six months ended June 30, 2013 vs. Six months ended June 30, 2012

Operating expenses for the six months ended June 30, 2013 decreased by $5.2 million over the first half of 2012, primarily as the result of $3.0 million in lower restructuring expenses, as well as lower sales and marketing costs and scheduled decreases in amortization of intangible assets, partially offset by $1.1 million in increased product development costs. Operating expenses as a percentage of revenues were 24% for the six months ended June 30, 2013, compared with 26% for the same period in 2012.

Corporate unallocated:

Operating expenses not directly associated with an operating segment are classified as “Corporate unallocated.” These expenses were lower by $495,000 and $4.3 million in the three and six months ended June 30, 2013, primarily due to certain costs incurred in 2012. The prior year included costs for the SmartSynch acquisition of $2.9 million, management training and development costs, and preliminary planning costs for our global enterprise resource planning (ERP) software initiative.

Bookings and Backlog of Orders

Bookings for a reported period represent customer contracts and purchase orders received during the period that have met certain conditions, such as regulatory and/or contractual approval. Total backlog represents committed but undelivered contracts and purchase orders at period-end. Twelve-month backlog represents the portion of total backlog that we estimate will be recognized as revenue over the next 12 months. Backlog is not a complete measure of our future revenues as we also receive significant book-and-ship orders. Bookings and backlog may fluctuate significantly due to the timing of large project awards. In addition, annual or multi-year contracts are subject to rescheduling and cancellation by customers due to the long-term nature of the contracts. Beginning total backlog, plus bookings, minus revenues, will not equal ending total backlog due to miscellaneous contract adjustments, foreign currency fluctuations, and other factors.

Quarter Ended	Quarterly Bookings		Ending Total Backlog		Ending 12-Month Backlog
	(in millions)
June 30, 2013	$	515	$	1,058	$	558
March 31, 2013	447		1,029		565
December 31, 2012	467		1,035		568
September 30, 2012	459		1,079		592
June 30, 2012	447		1,122		637

Information on bookings by our operating segments is as follows:

Quarter Ended	Bookings		Energy		Water
	(in millions)
June 30, 2013	$	515	$	365	$	150
March 31, 2013	447		305		142
December 31, 2012	467		345		122
September 30, 2012	459		341		118
June 30, 2012	447		330		117

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Operating Expenses

	Three Months Ended June 30,						Six Months Ended June 30,
	2013		% of Revenues	2012		% of Revenues	2013		% of Revenues	2012		% of Revenues
	(in thousands)			(in thousands)			(in thousands)			(in thousands)
Sales and marketing	$	46,182	10%	$	50,847	9%	$	94,398	10%	$	100,703	9%
Product development	43,481		9%	46,640		8%	87,689		9%	90,996		8%
General and administrative	38,317		8%	33,450		6%	71,912		8%	70,020		6%
Amortization of intangible assets	10,247		2%	12,025		2%	20,991		2%	23,938		2%
Restructuring	3,385		1%	7,720		1%	4,398		—%	8,509		1%
Total operating expenses	$	141,612	29%	$	150,682	26%	$	279,388	30%	$	294,166	26%

Operating expenses decreased $9.1 million and $14.8 million for the three and six months ended June 30, 2013, primarily due to reduced sales and marketing, product development, and restructuring costs, partially offset by increased litigation reserves, which are included within general and administrative operating expense. In addition, the three and six months ended June 30, 2013 include scheduled decreases in amortization of intangible assets of $1.8 million and $2.9 million.

Other Income (Expense)

The following table shows the components of other income (expense):

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Interest income	$	194		$	177		$	1,255		$	370
Interest expense	(1,920		)	(2,191		)	(3,845		)	(4,280		)
Amortization of prepaid debt fees	(416		)	(415		)	(829		)	(763		)
Other income (expense), net	(1,742		)	(779		)	(2,559		)	(2,955		)
Total other income (expense)	$	(3,884	)	$	(3,208	)	$	(5,978	)	$	(7,628	)

Interest income: Interest income is generated from our cash and cash equivalents balances and certain deposits on hand with third parties. Interest income in the six months ended June 30, 2013 includes interest recognized on certain deposits with governmental entities related to tax contingencies.

Interest expense: Interest expense for the three and six months ended June 30, 2013 declined due to a lower balance of outstanding debt on our credit facility. Average total debt outstanding was $404.2 million and $475.7 million for the quarters ended June 30, 2013 and 2012, respectively, and $410.4 million and $460.7 million for the six month periods ended June 30, 2013 and 2012, respectively.

Amortization of prepaid debt fees: Amortization of prepaid debt fees for the six months ended June 30, 2013 increased from the same period in 2012 as the result of fees paid during the second quarter of 2012 for the increase in the borrowing capacity of the multicurrency revolving line of credit. Refer to Item 1: “Financial Statements Note 6: Debt” for additional details related to our long-term borrowings.

Other income (expense), net: Other expenses, net, consist primarily of unrealized and realized foreign currency gains and losses from balances denominated in currencies other than the reporting entity's functional currency and other non-operating income (expenses). Foreign currency losses, net of hedging, were $1.6 million and $2.1 million for the three and six months ended June 30, 2013, compared with net foreign currency losses of $495,000 and $1.5 million in the same periods in 2012.

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Financial Condition

Cash Flow Information:

	Six Months Ended June 30,
	2013			2012
	(in thousands)
Operating activities	$	18,974		$	92,390
Investing activities	(29,514		)	(99,159		)
Financing activities	(18,816		)	(21,342		)
Effect of exchange rates on cash and cash equivalents	(3,393		)	(2,175		)
Decrease in cash and cash equivalents	$	(32,749	)	$	(30,286	)

Cash and cash equivalents was $103.7 million at June 30, 2013, compared with $136.4 million at December 31, 2012.

Operating activities

Cash provided by operating activities during the six months ended June 30, 2013 was $73.4 million lower, compared with the same period in 2012. This decline was primarily due to (1) a decrease in net income, adjusted for non-cash items, such as depreciation and amortization, stock-based compensation, and other adjustments, of $59.8 million and (2) a larger increase in net operating assets and liabilities, primarily as a result of a larger accumulation of inventories and an increase in accounts receivable, in the six months ended June 30, 2013 as compared to the same period in 2012, when accounts receivable decreased.

Investing activities

Cash used in investing activities during the six months ended June 30, 2013 was $69.6 million lower, compared with the same period in 2012, primarily due to a decline in business acquisitions of $78.7 million, which was partially offset by an increase in acquisitions of property, plant, and equipment of $5.3 million. In the first six months of 2013, there was no significant business acquisition activity, while during the same period in 2012 we acquired SmartSynch.

Financing activities

Net cash used in financing activities during the six months ended June 30, 2013 was $2.5 million lower, compared with the same period in 2012, as a result of a decrease of $9.9 million in repurchases of our common stock and an increase of $2.5 million in other financing activities in 2013. These improvements in cash position were partially offset by increased repayments of debt, net of proceeds from borrowings, in 2013. During the first six months of 2013, we made payments on debt, net of proceeds from borrowings, of $7.5 million, compared to proceeds from borrowings, net of payments on debt, of $2.5 million during the same period in 2012. Refer to Part II, Item 2: "Unregistered Sale of Equity Securities and Use of Proceeds" for additional details related to our share repurchase program.

Effect of exchange rates on cash and cash equivalents

The effect of exchange rates on the cash balances of currencies held in foreign denominations for the six months ended June 30, 2013 was a decrease of $3.4 million, compared with an decrease of $2.2 million for the same period in 2012.

Off-balance sheet arrangements:

We have no off-balance sheet financing agreements or guarantees as defined by Item 303 of Regulation S-K at June 30, 2013 and December 31, 2012 that we believe are reasonably likely to have a current or future effect on our financial condition, results of operations, or cash flows.

Liquidity and Capital Resources:

Our principal sources of liquidity are cash flows from operations, borrowings, and sales of common stock. Cash flows may fluctuate and are sensitive to many factors including changes in working capital and the timing and magnitude of capital expenditures and payments on debt. Working capital, which represents current assets less current liabilities, was $355.1 million at June 30, 2013, compared with $353.6 million at December 31, 2012.

Borrowings

In August 2011, we entered into a senior secured credit facility (the credit facility). The credit facility consists of a $300 million U.S. dollar term loan and a multicurrency revolving line of credit (the revolver) with a principal amount of up to $660 million.

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At June 30, 2013, $140.0 million was outstanding under the revolver, and $47.0 million was utilized by outstanding standby letters of credit, resulting in $473.0 million available for additional borrowings.

For further description of the term loan and the revolver under our credit facility, refer to Item 1: “Financial Statements, Note 6: Debt.”

For a description of our letters of credit and performance bonds, and the amounts available for additional borrowings or letters of credit under our lines of credit, including the revolver that is part of our credit facility, refer to Item 1: “Financial Statements, Note 11: Commitments and Contingencies.”

Share Repurchase

On March 8, 2013, our Board of Directors authorized a repurchase program of up to $50 million of our common stock through March 7, 2014. Repurchases are made in the open market or in privately negotiated transactions and in accordance with applicable securities laws. Depending on market conditions and other factors, these repurchases may be commenced or suspended from time to time without prior notice. During the six months ended June 30, 2013, we repurchased 384,800 shares of our common stock, totaling $16.1 million, leaving $33.9 million remaining under the repurchase program. Refer to Part II, Item 2: "Unregistered Sales of Equity Securities and Use of Proceeds" for additional information related to our share repurchase program.

Restructuring

During the fourth quarter of 2011, we announced the approval of projects to restructure our manufacturing operations to increase efficiency and lower our cost of manufacturing. We began implementing these projects in the fourth quarter of 2011.

As of June 30, 2013, we have substantially completed these restructuring projects. We do not anticipate substantial expenses related to these restructuring projects to be recognized in the Consolidated Statements of Operations in future periods. At June 30, 2013, the current and long-term portions of the restructuring related liability balances were $13.9 million and $3.7 million, respectively. For further details regarding our restructuring activities, refer to Item 1: “Financial Statements, Note 12: Restructuring.”

Other Liquidity Considerations

We have tax credits and net operating loss carryforwards in various jurisdictions that are available to reduce cash taxes. However, utilization of tax credits and net operating losses are limited in certain jurisdictions. Based on current projections, we expect to pay, net of refunds, approximately $300,000 in state taxes and $11.6 million in local and foreign taxes in 2013. We do not expect to make any payments for U.S. federal taxes in 2013. For a discussion of our tax provision and unrecognized tax benefits, see Item 1: “Financial Statements, Note 10: Income Taxes.”

As of June 30, 2013, there was $36.3 million of cash and cash equivalents held by foreign subsidiaries that could be repatriated, if necessary to fund U.S. operations. Tax is one of the many factors that we consider in the management of global cash. Included in the determination of the tax costs in repatriating foreign cash into the United States are the amount of earnings and profits in a particular jurisdiction, withholding taxes that would be imposed, and available foreign tax credits. Accordingly, the amount of taxes that we would need to accrue and pay to repatriate foreign cash could vary significantly.

The American Taxpayer Relief Act of 2012 (the "Act") was signed into law on January 2, 2013 and extended several business tax provisions including: (1) the active financing income and controlled foreign corporation look-through exceptions to certain foreign income; and (2) the research and experimentation credit. The tax effects of the Act were recognized in the first quarter of 2013.

In several of our consolidated international subsidiaries, we have joint venture partners, who are minority shareholders. Although these entities are not wholly-owned by Itron, Inc, we consolidate them because we have a greater than 50% ownership interest or because we exercise control over the operations. The noncontrolling interest balance in our Consolidated Balance Sheets represents the proportional share of the equity of the joint venture entities, which is attributable to the minority shareholders. Approximately $23.0 million of our consolidated cash balance at June 30, 2013 resides in our joint venture entities. As a result, the minority shareholders of these entities control their proportional share of this cash balance, and there may be limitations on our ability to repatriate cash to the U.S. from these entities.

For a description of our funded and unfunded non-U.S. defined benefit pension plans and our expected 2013 contributions, refer to Item 1: “Financial Statements, Note 8: Defined Benefit Pension Plans.”

For a description of our bonus and profit sharing plans, including the amounts accrued at June 30, 2013 and the expected timing of payment, refer to Bonus and Profit Sharing within Critical Accounting Estimates below.

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General Liquidity Overview

We expect to grow through a combination of internal new product development, licensing technology from and to others, distribution agreements, partnering arrangements, and acquisitions of technology or other companies. We expect these activities to be funded with existing cash, cash flow from operations, borrowings, and the sale of common stock or other securities. We believe existing sources of liquidity will be sufficient to fund our existing operations and obligations for the next 12 months and into the foreseeable future, but offer no assurances. Our liquidity could be affected by unforeseen changes in the energy and water industries, competitive pressures, changes in estimated liabilities for product warranties and/or litigation, future business combinations, capital market fluctuations, international risks, and other factors described under “Risk Factors” within Item 1A of Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, which was filed with the SEC on February 22, 2013, as well as “Quantitative and Qualitative Disclosures About Market Risk” within Item 3 of Part I included in this Quarterly Report on Form 10-Q.

Contingencies

Refer to Item 1: “Financial Statements, Note 11: Commitments and Contingencies”.

Critical Accounting Estimates

Revenue Recognition

The majority of our revenue arrangements involve multiple deliverables, which require us to determine the fair value of each deliverable and then allocate the total arrangement consideration among the separate deliverables based on the relative fair value percentages. Revenues for each deliverable are then recognized based on the type of deliverable, such as 1) when the products are shipped, 2) services are delivered, 3) percentage-of-completion when implementation services are essential to other deliverables in the arrangement, 4) upon receipt of customer acceptance, or 5) transfer of title and risk of loss. A majority of our revenue is recognized when products are shipped to or received by a customer or when services are provided.

Fair value represents the estimated price charged if an element were sold separately. If the fair value of any undelivered element included in a multiple deliverable arrangement cannot be objectively determined, revenue is deferred until all elements are delivered and services have been performed, or until the fair value can be objectively determined for any remaining undelivered elements. We review our fair values on an annual basis or more frequently if a significant trend is noted.

If implementation services are essential to a software arrangement, revenue is recognized using either the percentage-of-completion methodology of contract accounting if project costs can be reliably estimated or the completed contract methodology if project costs cannot be reliably estimated. The estimation of costs through completion of a project is subject to many variables such as the length of time to complete, changes in wages, subcontractor performance, supplier information, and business volume assumptions. Changes in underlying assumptions/estimates may adversely or positively affect financial performance.

Certain of our revenue arrangements include an extended or noncustomary warranty provision that covers all or a portion of a customer's replacement or repair costs beyond the standard or customary warranty period. Whether or not the extended warranty is separately priced in the arrangement, a portion of the arrangement's total consideration is allocated to this extended warranty deliverable. This revenue is deferred and recognized over the extended warranty coverage period. Extended or noncustomary warranties do not represent a significant portion of our revenue.

We allocate consideration to each deliverable in an arrangement based on its relative selling price. We determine selling price using VSOE, if it exists, otherwise we use third-party evidence (TPE). We define VSOE as a median price of recent standalone transactions that are priced within a narrow range. TPE is determined based on the prices charged by our competitors for a similar deliverable when sold separately. If neither VSOE nor TPE of selling price exists for a unit of accounting, we use estimated selling price (ESP). The objective of ESP is to determine the price at which we would transact if the product or service were regularly sold by us on a standalone basis. Our determination of ESP involves a weighting of several factors based on the specific facts and circumstances of the arrangement. The factors considered include the cost to produce the deliverable, the anticipated margin on that deliverable, our ongoing pricing strategy and policies, and the characteristics of the varying markets in which the deliverable is sold.

We analyze the selling prices used in our allocation of arrangement consideration on an annual basis. Selling prices are analyzed on a more frequent basis if a significant change in our business necessitates a more timely analysis or if we experience significant variances in our selling prices.

Warranty

We offer standard warranties on our hardware products and large application software products. We accrue the estimated cost of new product warranties based on historical and projected product performance trends and costs during the warranty period. Testing

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of new products in the development stage helps identify and correct potential warranty issues prior to manufacturing. Continuous quality control efforts during manufacturing reduce our exposure to warranty claims. If our quality control efforts fail to detect a fault in one of our products, we may experience an increase in warranty claims. We track warranty claims to identify potential warranty trends. If an unusual trend is noted, an additional warranty accrual may be assessed and recorded when a failure event is probable and the cost can be reasonably estimated. When new products are introduced, our process relies on historical averages until sufficient data are available. As actual experience on new products becomes available, it is used to modify the historical averages to ensure the expected warranty costs are within a range of likely outcomes. Management continually evaluates the sufficiency of the warranty provisions and makes adjustments when necessary. The warranty allowances may fluctuate due to changes in estimates for material, labor, and other costs we may incur to repair or replace projected product failures, and we may incur additional warranty and related expenses in the future with respect to new or established products, which could adversely affect our gross margin. The long-term warranty balance includes estimated warranty claims beyond one year.

Restructuring and Asset Impairments

We record a liability for costs associated with an exit or disposal activity at its fair value in the period in which the liability is incurred. Employee termination benefits considered post-employment benefits are accrued when the obligation is probable and estimable, such as benefits stipulated by human resource policies and practices or statutory requirements. One-time termination benefits are expensed at the date the employee is notified. If the employee must provide future service greater than 60 days, such benefits are expensed ratably over the future service period. For contract termination costs, we record a liability upon the later of when we terminate a contract in accordance with the contract terms or when we cease using the rights conveyed by the contract.

Asset impairments are determined at the asset group level. An impairment may be recorded for assets that are to be abandoned, are to be sold for less than net book value, or are held for sale in which the estimated proceeds are less than the net book value less costs to sell. We may also recognize impairment on an asset group, which is held and used, when the carrying value is not recoverable and exceeds the asset group's fair value. If an asset group is considered a business, a portion of the Company's goodwill balance is allocated to it based on relative fair value.

In determining restructuring charges, we analyze our future operating requirements, including the required headcount by business functions and facility space requirements. Our restructuring costs and any resulting accruals involve significant estimates using the best information available at the time the estimate are made. Our estimates involve a number of risks and uncertainties, some of which are beyond our control, including real estate market conditions and local labor and employment laws, rules, and regulations. If the amounts and timing of cash flows from restructuring activities are significantly different from what we have estimated, the actual amount of restructuring and asset impairment charges could be materially different, either higher or lower, than those we have recorded.

Income Taxes

The calculation of our annual estimated effective tax rate requires significant judgment and is subject to several factors, including fluctuations in the forecasted mix of earnings in domestic and international jurisdictions, new or revised tax legislation and accounting pronouncements, tax credits, state income taxes, adjustments to valuation allowances, and uncertain tax positions, among other items.

We record valuation allowances to reduce deferred tax assets to the extent we believe it is more likely than not that a portion of such assets will not be realized. In making such determinations, we consider available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies, and our ability to carry back losses to prior years. We are required to make assumptions and judgments about potential outcomes that lie outside management’s control. The most sensitive and critical factors are the projection, source, and character of future taxable income. Although realization is not assured, management believes it is more likely than not that deferred tax assets will be realized. The amount of deferred tax assets considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carryforward periods are reduced or current tax planning strategies are not implemented.

We are subject to audit in multiple taxing jurisdictions in which we operate. These audits may involve complex issues, which may require an extended period of time to resolve. We believe we have recorded adequate income tax provisions and reserves for uncertain tax positions.

In evaluating uncertain tax positions, we consider the relative risks and merits of positions taken in tax returns filed and to be filed, considering statutory, judicial, and regulatory guidance applicable to those positions. We make assumptions and judgments about potential outcomes that lie outside management’s control. To the extent the tax authorities disagree with our conclusions and depending on the final resolution of those disagreements, our actual tax rate may be materially affected in the period of final settlement with the tax authorities.

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Inventories

Items are removed from inventory using the first-in, first-out method. Inventories include raw materials, sub-assemblies, and finished goods. Inventory amounts include the cost to manufacture the item, such as the cost of raw materials, labor, and other applied direct and indirect costs. We also review idle facility expense, freight, handling costs, and wasted materials to determine if abnormal amounts should be recognized as current-period charges. We review our inventory for obsolescence and marketability. If the estimated market value, which is based upon assumptions about future demand and market conditions, falls below the original cost, the inventory value is reduced to the market value. If technology rapidly changes or actual market conditions are less favorable than those projected by management, inventory write-downs may be required. Our inventory levels may vary period to period as a result of our factory scheduling and timing of contract fulfillments.

Goodwill and Intangible Assets

Goodwill and intangible assets may result from our acquisitions. We use estimates, including estimates of useful lives of intangible assets, the amount and timing of related future cash flows, and fair values of the related operations, in determining the value assigned to goodwill and intangible assets. Our finite-lived intangible assets are amortized over their estimated useful lives based on estimated discounted cash flows. IPR&D is considered an indefinite-lived intangible asset and is not subject to amortization until the associated projects are completed or terminated. Finite-lived intangible assets are tested for impairment at the asset group level when events or changes in circumstances indicate the carrying value may not be recoverable. Indefinite-lived intangible assets are tested for impairment annually, when events or changes in circumstances indicate the asset may be impaired, or at the time when their useful lives are determined to be no longer indefinite.

Goodwill is assigned to our reporting units based on the expected benefit from the synergies arising from each business combination, determined by using certain financial metrics, including the forecasted discounted cash flows associated with each reporting unit.

We test goodwill for impairment each year as of October 1, or more frequently should a significant impairment indicator occur. As part of the impairment test, we may elect to perform an assessment of qualitative factors. If this qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit, including goodwill, is less than its carrying amount, or if we elect to bypass the qualitative assessment, we would then proceed with the two-step impairment test. The impairment test involves comparing the fair values of the reporting units to their carrying amounts. If the carrying amount of a reporting unit exceeds its fair value, a second step is required to measure the goodwill impairment loss amount. This second step determines the current fair values of all assets and liabilities of the reporting unit and then compares the implied fair value of the reporting unit's goodwill to the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in an amount equal to the excess.

Determining the fair value of a reporting unit is judgmental in nature and involves the use of significant estimates and assumptions. We forecast discounted future cash flows at the reporting unit level using risk-adjusted discount rates and estimated future revenues and operating costs, which take into consideration factors such as existing backlog, expected future orders, supplier contracts, and expectations of competitive and economic environments. We also identify similar publicly traded companies and develop a correlation, referred to as a multiple, to apply to the operating results of the reporting units. These combined fair values are then reconciled to the aggregate market value of our common stock on the date of valuation, while considering a reasonable control premium.

Based on our most recent annual goodwill impairment test as of October 1, 2012, the percentage by which the estimated fair value of the reporting units exceeded their carrying value and amount of goodwill allocated to each of these reporting units were as follows:

	October 1, 2012
Reporting Unit	Goodwill		Fair Value Exceeded Carrying Value
	(in thousands)
Energy - Electricity	$	221,119	19	%
Energy - Gas	382,563		66	%
Water	83,750		317	%

Changes in market demand, fluctuations in the economies in which we operate, the volatility and decline in the worldwide equity markets, and a further decline in our market capitalization could negatively impact the remaining carrying value of our goodwill, which could have a significant effect on our current and future results of operations and financial condition.

45

Derivative Instruments

All derivative instruments, whether designated in hedging relationships or not, are recorded on the Consolidated Balance Sheets at fair value as either assets or liabilities. The components and fair values of our derivative instruments are determined using the fair value measurements of significant other observable inputs (also known as “Level 2”), as defined by U.S. generally accepted accounting principles. We include the effect of our counterparty credit risk based on current published credit default swap rates when the net fair value of our derivative instruments is in a net asset position and the effect of our own nonperformance risk when the net fair value of our derivative instruments is in a net liability position. Level 2 inputs consist of quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in non-active markets; and model-derived valuations in which significant inputs are corroborated by observable market data either directly or indirectly through correlation or other means (inputs may include yield curves, volatility, credit risks, and default rates). Derivatives are not used for trading or speculative purposes. Our derivatives are with credit-worthy multinational financial institutions, with whom we have master netting agreements; however, our derivative positions are not disclosed on a net basis. There are no credit-risk-related contingent features within our derivative instruments.

Defined Benefit Pension Plans

We sponsor both funded and unfunded defined benefit pension plans for our international employees, primarily in Germany, France, Italy, Indonesia, and Spain. We recognize a liability for the projected benefit obligation in excess of plan assets or an asset for plan assets in excess of the projected benefit obligation. We also recognize the funded status of our defined benefit pension plans on our Consolidated Balance Sheets and recognize as a component of other comprehensive income (OCI), net of tax, the actuarial gains or losses and prior service costs or credits, if any, that arise during the period but are not recognized as components of net periodic benefit cost.

Several economic assumptions and actuarial data are used in calculating the expense and obligations related to these plans. The assumptions are updated annually at December 31 and include the discount rate, the expected remaining service life, the expected rate of return on plan assets, and the rate of future compensation increase. The discount rate is a significant assumption used to value our pension benefit obligation. We determine a discount rate for our plans based on the estimated duration of each plan’s liabilities. For our euro denominated defined benefit pension plans, which represent 94% of our benefit obligation, we use three discount rates, with consideration of the duration of the plans, using a hypothetical yield curve developed from euro-denominated AA-rated corporate bond issues, partially weighted for market value, with minimum amounts outstanding of €250 million for bonds with less than 10 years to maturity and €50 million for bonds with 10 or more years to maturity, and excluding the highest and lowest yielding 10% of bonds within each maturity group. The discount rates used, depending on the duration of the plans, were 2.75%, 3.25% and 3.50%, respectively. The weighted average discount rate used to measure the projected benefit obligation for all of the plans at December 31, 2012 was 3.36%. A change of 25 basis points in the discount rate would change our pension benefit obligation by approximately $4.0 million. The financial and actuarial assumptions used at December 31, 2012 may differ materially from actual results due to changing market and economic conditions and other factors. These differences could result in a significant change in the amount of pension expense recorded in future periods. Gains and losses resulting from changes in actuarial assumptions, including the discount rate, are recognized in OCI in the period in which they occur.

Our general funding policy for these qualified pension plans is to contribute amounts at least sufficient to satisfy funding standards of the respective countries for each plan. Refer to Item 1: “Financial Statements, Note 8: Defined Benefit Pension Plans” for our expected contributions for 2013.

Contingencies

A loss contingency is recorded if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. We evaluate, among other factors, the degree of probability of an unfavorable outcome and our ability to make a reasonable estimate of the amount of the ultimate loss. Loss contingencies that we determine to be reasonably possible, but not probable, are disclosed but not recorded. Changes in these factors and related estimates could materially affect our financial position and results of operations. Legal costs to defend against contingent liabilities are expensed as incurred.

Bonus and Profit Sharing

We have various employee bonus and profit sharing plans, which provide award amounts for the achievement of annual financial and nonfinancial targets. If management determines it probable that the targets will be achieved and the amounts can be reasonably estimated, a compensation accrual is recorded based on the proportional achievement of the financial and nonfinancial targets. Although we monitor and accrue expenses quarterly based on our estimated progress toward the achievement of the annual targets, the actual results at the end of the year may require awards that are significantly greater or less than the estimates made in earlier quarters. For the three and six months ended June 30, 2013, we accrued $2.0 million and $8.0 million for such awards, compared with $5.3 million and $11.9 million for the same periods in 2012. Awards are typically distributed in the first quarter of the following year.

46

Stock-Based Compensation

We measure and recognize compensation expense for all stock-based awards made to employees and directors, including awards of stock options, stock sold pursuant to our Employee Stock Purchase Plan (ESPP), and the issuance of restricted stock units and unrestricted stock awards, based on estimated fair values. The fair value of stock options is estimated at the date of grant using the Black-Scholes option-pricing model, which includes assumptions for the dividend yield, expected volatility, risk-free interest rate, and expected term. The fair value of restricted stock units with a market condition is estimated at the date of award using a Monte Carlo simulation model, which includes assumptions for the dividend yield, expected volatility, risk-free interest rate and the expected term. In valuing our stock options and restricted stock units with a market condition, significant judgment is required in determining the expected volatility of our common stock and the expected life that individuals will hold their stock options prior to exercising. Expected volatility for stock options is based on the historical and implied volatility of our own common stock while the volatility for our restricted stock units with a market condition is based on the historical volatility of our own stock and the stock for companies comprising the market index within the market condition. The expected life of stock option grants is derived from the historical actual term of option grants and an estimate of future exercises during the remaining contractual period of the option. While volatility and estimated life are assumptions that do not bear the risk of change subsequent to the grant date of stock options, these assumptions may be difficult to measure as they represent future expectations based on historical experience. Further, our expected volatility and expected life may change in the future, which could substantially change the grant-date fair value of future awards of stock options and ultimately the expense we record. For ESPP awards, the fair value is the difference between the market close price of our common stock on the date of purchase and the discounted purchase price. For restricted stock units without a market condition and unrestricted stock awards, the fair value is the market close price of our common stock on the date of grant. We consider many factors when estimating expected forfeitures, including types of awards, employee class, and historical experience. Actual results and future estimates may differ substantially from our current estimates. We expense stock-based compensation at the date of grant for unrestricted stock awards. For awards with only a service condition, we expense stock-based compensation, adjusted for estimated forfeitures, using the straight-line method over the requisite service period for the entire award. For awards with both performance and service conditions, we expense the stock-based compensation, adjusted for estimated forfeitures, on a straight-line basis over the requisite service period for each separately vesting portion of the award. Excess tax benefits are credited to common stock when the deduction reduces cash taxes payable. When we have tax deductions in excess of the compensation cost, they are classified as financing cash inflows in the Consolidated Statements of Cash Flows.

47

Item 3: Quantitative and Qualitative Disclosures about Market Risk

In the normal course of business, we are exposed to interest rate and foreign currency exchange rate risks that could impact our financial position and results of operations. As part of our risk management strategy, we may use derivative financial instruments to hedge certain foreign currency and interest rate exposures. Our objective is to offset gains and losses resulting from these exposures with losses and gains on the derivative contracts used to hedge them, therefore reducing the impact of volatility on earnings or protecting the fair values of assets and liabilities. We use derivative contracts only to manage existing underlying exposures. Accordingly, we do not use derivative contracts for trading or speculative purposes.

Interest Rate Risk

We are exposed to interest rate risk through our variable rate debt instruments. In May 2012, we entered into six forward starting pay-fixed receive one-month LIBOR interest rate swaps. The interest rate swaps convert $200 million of our LIBOR based debt from a floating LIBOR interest rate to a fixed interest rate of 1.00% (excluding the applicable margin on the debt) and are effective July 31, 2013 to August 8, 2016.

The table below provides information about our financial instruments that are sensitive to changes in interest rates and the scheduled minimum repayment of principal and the weighted average interest rates at June 30, 2013. Weighted average variable rates in the table are based on implied forward rates in the Reuters U.S. dollar yield curve as of June 30, 2013 and our estimated leverage ratio, which determines our additional interest rate margin at June 30, 2013.

	2013			2014			2015			2016			2017			Total		Fair Value
	(in thousands)
Variable Rate Debt
Principal: U.S. dollar term loan	$	11,250		$	26,250		$	30,000		$	202,500		$	—		$	270,000	$	268,219
Average interest rate	1.46		%	1.63		%	2.14		%	2.86		%	—		%
Principal: Multicurrency revolving line of credit	$	—		$	—		$	—		$	140,000		$	—		$	140,000	$	138,930
Average interest rate	1.46		%	1.63		%	2.14		%	2.86		%	—		%
Interest rate swap on LIBOR based debt
Average interest rate (Pay)	1.00		%	1.00		%	1.00		%	1.00		%
Average interest rate (Receive)	0.21		%	0.38		%	0.89		%	1.61		%
Net/Spread	(0.79		)%	(0.62		)%	(0.11		)%	0.61		%

Based on a sensitivity analysis as of June 30, 2013, we estimate that, if market interest rates average one percentage point higher in 2013 than in the table above, our financial results in 2013 would not be materially impacted.

We continually monitor and assess our interest rate risk and may institute additional interest rate swaps or other derivative instruments to manage such risk in the future.

Foreign Currency Exchange Rate Risk

We conduct business in a number of countries. As a result, over half of our revenues and operating expenses are denominated in foreign currencies, which expose our account balances to movements in foreign currency exchange rates that could have a material effect on our financial results. Our primary foreign currency exposure relates to non-U.S. dollar denominated transactions in our international subsidiary operations, the most significant of which is the euro. Revenues denominated in functional currencies other than the U.S. dollar were 59% and 62% of total revenues for the three and six months ended June 30, 2013, respectively, compared with 56% for the same periods in 2012.

We are also exposed to foreign exchange risk when we enter into non-functional currency transactions, both intercompany and third-party. At each period-end, non-functional currency monetary assets and liabilities are revalued, with the change recorded to other income and expense. We enter into monthly foreign exchange forward contracts (a total of 247 contracts were entered into during the six months ended June 30, 2013) not designated for hedge accounting, with the intent to reduce earnings volatility associated with certain of these balances. The notional amounts of the contracts ranged from $251,000 to $11.0 million, offsetting our exposures from the euro, Saudi riyal, Canadian dollar, Australian dollar, Brazilian real, South African rand, and various other currencies.

In future periods, we may use additional derivative contracts to protect against foreign currency exchange rate risks.

48

Item 4: Controls and Procedures

(a) Evaluation of disclosure controls and procedures. At June 30, 2013, an evaluation was performed under the supervision and with the participation of our Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e)) under the Securities Exchange Act of 1934, as amended. Based on that evaluation, the Company’s management, including the Chief Executive Officer and Chief Financial Officer, concluded that as of June 30, 2013, the Company’s disclosure controls and procedures were effective to ensure the information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives.

(b) Changes in internal controls over financial reporting. While we are continuing the process of upgrading our global enterprise resource software systems and information technology infrastructure, there have been no changes in our internal control over financial reporting during the three months ended June 30, 2013 that materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

49

PART II: OTHER INFORMATION

Item 1: Legal Proceedings

There were no material changes, as defined by Item 103 of Regulation S-K, during the second quarter of 2013.

Item 1A: Risk Factors

There were no material changes to risk factors during the second quarter of 2013 from those previously disclosed in Item 1A: "Risk Factors" of Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, which was filed with the SEC on February 22, 2013.

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

(a) Not applicable.

(b) Not applicable.

(c) Issuer Repurchase of Equity Securities

The table below summarizes information about the Company's purchases of its shares of common stock, based on settlement date, during the quarterly period ended June 30, 2013.

Period	Total Number of Shares Purchased(1)	Average Price Paid per Share(2)		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
					(in thousands)
April 1 through April 30	52,839	$	44.19	52,839	$	47,465
May 1 through May 31	186,307	40.90		186,307	39,845
June 1 through June 30	141,164	42.30		141,164	33,874
Total	380,310	$	41.88	380,310

⁽¹⁾  On March 8, 2013, the Board authorized a twelve-month repurchase program of up to $50 million of our common stock. Repurchases are made in the open market or in privately negotiated transactions, and in accordance with applicable securities laws. No shares were purchased outside of this plan.

⁽²⁾  Includes commissions.

Subsequent to June 30, 2013, we repurchased 174,200 shares of our common stock under the stock repurchase program authorized by the Board of Directors on March 8, 2013. The average price paid per share was $42.71.

Item 5: Other Information

(a) No information was required to be disclosed in a report on Form 8-K during the second quarter of 2013 that was not reported.

(b) Not applicable.

50

Item 6: Exhibits

Exhibit Number	Description of Exhibits
31.1	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification 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.
101.DEF	XBRL Taxonomy Extension Definition Linkbase.
101.LAB	XBRL Taxonomy Extension Label Linkbase.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase.

51

SIGNATURE

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.

	ITRON, INC.
August 6, 2013	By:	/s/ STEVEN M. HELMBRECHT
Date		Steven M. Helmbrecht
		Executive Vice President and Chief Financial Officer

52

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, Philip C. Mezey, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Itron, 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 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 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.

ITRON, INC.
By:	/s/ PHILIP C. MEZEY
Philip C. Mezey President and Chief Executive Officer

Date: August 6, 2013

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, Steven M. Helmbrecht, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Itron, 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 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 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.

ITRON, INC.
By:	/s/ STEVEN M. HELMBRECHT
Steven M. Helmbrecht Executive Vice President and Chief Financial Officer

Date: August 6, 2013

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE

SARBANES-OXLEY ACT OF 2002

The certification set forth below is being submitted in connection with the Quarterly Report of Itron, Inc. (the Company) on Form 10-Q for the quarterly period ended June 30, 2013 (the Report) for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 and Section 1350 of Chapter 63 of Title 18 of the United States Code.

Philip C. Mezey, the Chief Executive Officer and Steven M. Helmbrecht, the Chief Financial Officer of the Company, each certifies that to the best of his knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ PHILIP C. MEZEY

Philip C. Mezey

President and Chief Executive Officer

August 6, 2013

/s/ STEVEN M. HELMBRECHT 

Steven M. Helmbrecht

Executive Vice President and Chief Financial Officer

August 6, 2013

XML

Commitments and Contingencies Warranty Account Activity (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Warranty Activity [Line Items]
Beginning balance	$ 50,754	$ 77,251	$ 53,605	$ 79,536
New product warranties	1,961	3,507	2,822	5,636
Other changes/adjustments to warranties	3,611	(3,770)	5,638	2,061
Claims activity	(5,289)	(8,255)	(10,388)	(19,575)
Effect of change in exchange rates	(405)	(2,365)	(1,045)	(1,290)
Ending balance	50,632	66,368	50,632	66,368
Less: current portion of warranty	24,709	42,861	24,709	42,861
Long-term warranty	$ 25,923	$ 23,507	$ 25,923	$ 23,507

XML

Stock-Based Compensation Stock Option Black Scholes Option Pricing Model Assumptions (Details) (Employee Stock Option [Member])	3 Months Ended				6 Months Ended
	Jun. 30, 2013		Jun. 30, 2012		Jun. 30, 2013	Jun. 30, 2012
Employee Stock Option [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items]
Dividend yield	0.00%	[1]	0.00%	[1]	0.00%	0.00%
Expected volatility	0.00%	[1]	0.00%	[1]	38.10%	42.70%
Risk-free interest rate	0.00%	[1]	0.00%	[1]	1.00%	0.90%
Expected term (years)	0 years	[1]	0 years	[1]	5 years 5 months 11 days	5 years 1 month 21 days

[1] There were no employee stock options granted for the three months ended June 30, 2013 and 2012.

XML

Stock-Based Compensation Long-Term Performance Restricted Stock Unit Award Monte Carlo Pricing Model Assumptions (Details) (Restricted Stock Units (RSUs) [Member], USD $)	6 Months Ended				3 Months Ended	6 Months Ended
	Jun. 30, 2013		Jun. 30, 2012		Jun. 30, 2013 Long Term Performance Restricted Stock Award [Member]	Jun. 30, 2013 Long Term Performance Restricted Stock Award [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield					0.00%	0.00%
Expected volatility					39.10%	39.10%
Risk-free interest rate					0.30%	0.30%
Expected term (years)					2 years 6 months 10 days	2 years 6 months 10 days
Weighted-average fair value	$ 42.51	[1]	$ 47.33	[1]	$ 45.70	$ 45.03

[1] Restricted stock units granted in 2012 and 2013 do not include awards under the Performance Award Agreement for the respective years, as these awards are not granted until final attainment of performance goals has been determined at the conclusion of the performance period, which had not occurred as of June 30, 2012 and 2013, respectively.

XML

Restructuring Restructuring Expected Costs, Costs To-Date, Remaining Costs, and Costs During the Period (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended			15 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013		Jun. 30, 2012	Dec. 31, 2012
Restructuring Cost and Reserve [Line Items]
Total expected costs at period end			$ 74,145
Costs Recognized in Prior Periods						69,747
Costs recognized during the period ended	3,385	7,720	4,398		8,509
Remaining Costs to be Recognized at Period End			0	[1]
Employee severance costs
Restructuring Cost and Reserve [Line Items]
Total expected costs at period end			46,850
Costs Recognized in Prior Periods						44,196
Costs recognized during the period ended			2,654
Remaining Costs to be Recognized at Period End			0	[1]
Asset Impairment and Net (Gain) Loss on Sale or Disposal [Member]
Restructuring Cost and Reserve [Line Items]
Total expected costs at period end			20,332
Costs Recognized in Prior Periods						20,305
Costs recognized during the period ended			27
Remaining Costs to be Recognized at Period End			0	[1]
Other restructuring costs
Restructuring Cost and Reserve [Line Items]
Total expected costs at period end			6,963
Costs Recognized in Prior Periods						5,246
Costs recognized during the period ended			1,717
Remaining Costs to be Recognized at Period End			0	[1]
Energy [Member]
Restructuring Cost and Reserve [Line Items]
Total expected costs at period end			53,385
Costs Recognized in Prior Periods						53,190
Costs recognized during the period ended			195
Remaining Costs to be Recognized at Period End			0	[1]
Water [Member]
Restructuring Cost and Reserve [Line Items]
Total expected costs at period end			15,675
Costs Recognized in Prior Periods						14,556
Costs recognized during the period ended			1,119
Remaining Costs to be Recognized at Period End			0	[1]
Corporate Unallocated [Member]
Restructuring Cost and Reserve [Line Items]
Total expected costs at period end			5,085
Costs Recognized in Prior Periods						2,001
Costs recognized during the period ended			3,084
Remaining Costs to be Recognized at Period End			$ 0	[1]

[1] There are no significant restructuring costs expected to be incurred after June 30, 2013 for these restructuring projects.

XML

Fair Values of Financial Instruments Schedule of Fair Values of Financial Instruments (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2012	Dec. 31, 2011
Assets
Cash and cash equivalents	$ 103,662	$ 136,411	$ 102,800	$ 133,086
Cash and cash equivalents, at fair value	103,662	136,411
Foreign Exchange Forwards	122	146
Liabilities
Interest Rate Swaps	1,482	2,725
Foreign Exchange Forwards Liability	108	114
USD Denominated Term Loan [Member]
Liabilities
Term loans	270,000	277,500
Term loans, at fair value	268,219	275,365
Line of Credit [Member]
Liabilities
Multicurrency revolving line of credit	140,000	140,000
Line of Credit Facility, Fair Value of Amount Outstanding	138,930	138,751
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Assets
Foreign exchange forwards, asset, at fair value	122	146
Liabilities
Interest rate swap contracts	1,482	2,725
Foreign exchange forwards, liability, at fair value	$ 108	$ 114

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Restructuring

6 Months Ended

Jun. 30, 2013

Restructuring and Related Activities [Abstract]

Restructuring, Impairment, and Other Activities Disclosure [Text Block]

Restructuring

During the fourth quarter of 2011, we announced the approval of projects to restructure our manufacturing operations to increase efficiency and lower our cost of manufacturing. We began implementing these projects in the fourth quarter of 2011.

As of June 30, 2013, we have substantially completed these restructuring projects. We do not anticipate substantial expenses related to these restructuring projects to be recognized in the Consolidated Statements of Operations in future periods.

The total expected restructuring costs, the costs recognized in prior periods, the restructuring costs recognized during the six months ended June 30, 2013, and the remaining expected restructuring costs as of June 30, 2013 are as follows:

	Total Expected Costs at  June 30, 2013		Costs Recognized in Prior Periods		Costs Recognized During the Six Months Ended June 30, 2013		Remaining Costs to be Recognized at June 30, 2013 (1)
	(in thousands)
Employee severance costs	$	46,850	$	44,196	$	2,654	$	—
Asset impairments	20,332		20,305		27		—
Other restructuring costs	6,963		5,246		1,717		—
Total	$	74,145	$	69,747	$	4,398	$	—
Segments:
Energy	$	53,385	$	53,190	$	195	$	—
Water	15,675		14,556		1,119		—
Corporate unallocated	5,085		2,001		3,084		—
Total	$	74,145	$	69,747	$	4,398	$	—

⁽¹⁾ There are no significant restructuring costs expected to be incurred after June 30, 2013 for these restructuring projects.

Other restructuring costs include expenses to exit the facilities once the operations in those facilities have ceased. Costs associated with restructuring activities are generally presented as restructuring expense in the Consolidated Statements of Operations, except for certain costs associated with inventory write-downs, which are classified within cost of revenues, and accelerated depreciation expense, which is recognized according to the use of the asset.

The following table summarizes the activity within the restructuring related balance sheet accounts during the six months ended June 30, 2013:

	Accrued Employee Severance			Asset Impairments & Net Loss on Sale or Disposal			Other Accrued Costs			Total
	(in thousands)
Beginning balance, January 1, 2013	$	14,498		$	—		$	3,216		$	17,714
Costs incurred and charged to expense	2,654			27			1,717			4,398
Cash payments	(3,155		)	—			(833		)	(3,988		)
Non-cash items	—			(27		)	—			(27		)
Effect of change in exchange rates	(447		)	—			(28		)	(475		)
Ending balance, June 30, 2013	$	13,550		$	—		$	4,072		$	17,622

The current portions of the restructuring related liability balances were $13.9 million and $13.2 million as of June 30, 2013 and December 31, 2012, respectively. The current portion of the liability is classified within "Other current liabilities" on the Consolidated Balance Sheets. The long-term portions of the restructuring related liability related balances were $3.7 million and $4.5 million as of June 30, 2013 and December 31, 2012, respectively. The long-term portion of the restructuring liability is classified within "Other long-term liabilities" on the Consolidated Balance Sheets.

Asset impairments are determined at the asset group level. Assets held for sale are classified within other current assets and are reported at the lower of the carrying amount or the fair value, less costs to sell, and are no longer depreciated or amortized.

The following table includes assets that were measured at fair value on a nonrecurring basis as of June 30, 2013 and December 31, 2012, and the related losses recognized during the period:

	Net Carrying Value		Fair Value Measurement (Level 3)		Total Loss Recognized in Period
	(in thousands)
June 30, 2013
Long-lived assets held for sale	$	3,128	$	3,128	$	—
December 31, 2012
Long-lived assets held for sale	$	3,184	$	3,184	$	2

The fair values of the disposal groups included in long-lived assets held for sale were determined based on the estimated proceeds from their expected sales, net of estimated selling costs. Long-lived assets held for sale at June 30, 2013 and December 31, 2012 consist of one asset group that includes land, a building, and building improvements.

Revenues and net operating income from the activities we have exited or will exit under the restructuring plan are not material to our operating segments or consolidated results.

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Certain Balance Sheet Components Depreciation Expense and Capitalized Interest (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Depreciation expense [Line Items]
Depreciation expense	$ 14,027	$ 15,019	$ 28,040	$ 30,333
Capitalized interest	$ 21	$ 0	$ 64	$ 0

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
ASSETS
Cash and cash equivalents	$ 103,662	$ 136,411
Accounts receivable, net	372,240	375,326
Inventories	190,414	170,719
Deferred tax assets current, net	33,138	33,536
Other current assets	112,014	104,958
Total current assets	811,468	820,950
Property, plant, and equipment, net	249,372	255,212
Deferred tax assets noncurrent, net	55,397	44,584
Other long-term assets	26,607	28,908
Intangible assets, net	210,849	238,771
Goodwill	696,215	701,016
Total assets	2,049,908	2,089,441
LIABILITIES AND EQUITY
Accounts payable	203,092	227,739
Other current liabilities	54,988	49,950
Wages and benefits payable	84,831	91,802
Taxes payable	15,481	9,305
Current portion of debt	22,500	18,750
Current portion of warranty	24,709	27,115
Unearned revenue	50,799	42,712
Total current liabilities	456,400	467,373
Long-term debt	387,500	398,750
Long-term warranty	25,923	26,490
Pension plan benefit liability	89,948	90,533
Deferred tax liabilities noncurrent, net	11,235	16,682
Other long-term obligations	81,229	80,100
Total liabilities	1,052,235	1,079,928
Commitments and contingencies
Equity
Preferred stock	0	0
Common stock	1,290,226	1,294,213
Accumulated other comprehensive loss, net	(57,929)	(34,384)
Accumulated deficit	(251,893)	(266,862)
Total Itron, Inc. shareholders' equity	980,404	992,967
Noncontrolling interests	17,269	16,546
Total equity	997,673	1,009,513
Total liabilities and equity	$ 2,049,908	$ 2,089,441

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Goodwill (Text Block)

6 Months Ended

Jun. 30, 2013

Goodwill Excluding Non Goodwill Intangibles [Abstract]

Goodwill Disclosure [Text Block]

Goodwill

The following table reflects the goodwill balance as of June 30, 2013:

	Energy			Water			Total Company
	(in thousands)
Balance at January 1, 2013
Goodwill before impairment	$	859,454		$	414,394		$	1,273,848
Accumulated impairment losses	(249,502		)	(323,330		)	(572,832		)
Goodwill, net	609,952			91,064			701,016
Adjustments of previous acquisition	3,958			—			3,958
Effect of change in exchange rates	(7,551		)	(1,208		)	(8,759		)
Balance at June 30, 2013
Goodwill before impairment	851,471			407,497			1,258,968
Accumulated impairment losses	(245,112		)	(317,641		)	(562,753		)
Goodwill, net	$	606,359		$	89,856		$	696,215

During the second quarter of 2013, we finalized the purchase price allocation related to the SmartSynch acquisition, which was completed on May 1, 2012, and recorded certain adjustments that are reflected as Adjustments of previous acquisition. These adjustments primarily affected the fair value calculation of certain accrued liabilities associated with specific contracts. Among these adjustments is the correction of an error associated with a long-term revenue contract acquired from SmartSynch. In May 2013, we determined that certain manufacturing costs were not reflected in the model used to value this contract at acquisition. Once these costs were properly added to the total cost and profitability estimates, we determined the total contract would result in a loss of $2.4 million over the contract term. Therefore, we recognized a liability for this expected loss on the contract and made a corresponding adjustment to goodwill. Further, we had previously recognized a customer relationship intangible asset of $1.5 million associated with this contract, with amortization scheduled to begin in 2014 based on the contract's original projected cash flow. Since the contract is in an overall loss position, we determined that the intangible asset had no value. We reduced the value of this intangible asset to zero with a corresponding adjustment to goodwill. In accordance with relevant accounting guidance, we evaluated the materiality of the error from a qualitative and quantitative perspective. Based on such evaluation, we concluded that recognizing the contract liability and adjusting the intangible asset value would not be material, quantitatively or qualitatively, to our results of operations for the three months ended June 30, 2013 or our expected full year results of operations for 2013 and would not have had a material impact on our results for the year ended December 31, 2012. Because these adjustments were not material individually or in aggregate, we have not retrospectively adjusted the comparative amounts on the Consolidated Balance Sheet as of December 31, 2012.

Accumulated impairment losses relate to goodwill impairment charges recorded during 2011 as a result of a significant decline in the price of our shares of common stock at the end of September 2011, which reduced our aggregate market value significantly below the carrying value of our net assets as of September 30, 2011.

Goodwill and accumulated impairment losses associated with our international subsidiaries are recorded in their respective functional currency; therefore, the carrying amounts of these balances increase or decrease, with a corresponding change in accumulated OCI, due to changes in foreign currency exchange rates.

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Certain Balance Sheet Components Certain Balance Sheet Components (Tables)

6 Months Ended

Jun. 30, 2013

Balance Sheet Related Disclosures [Abstract]

Accounts Receivable, Net [Table Text Block]

Accounts receivable, net	June 30, 2013		December 31, 2012
	(in thousands)
Trade receivables (net of allowance of $6,948 and $7,372)	$	330,956	$	329,352
Unbilled receivables	41,284		45,974
Total accounts receivable, net	$	372,240	$	375,326

Allowance for Credit Losses on Financing Receivables [Table Text Block]

Allowance for doubtful account activity	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Beginning balance	$	6,144		$	5,983		$	7,372		$	6,049
Provision (release) of doubtful accounts, net	1,075			(230		)	171			(290		)
Accounts written-off	(198		)	(22		)	(303		)	(261		)
Effects of change in exchange rates	(73		)	(350		)	(292		)	(117		)
Ending balance	$	6,948		$	5,381		$	6,948		$	5,381

Inventories [Table Text Block]

Inventories	June 30, 2013		December 31, 2012
	(in thousands)
Materials	$	104,283	$	92,038
Work in process	13,879		12,568
Finished goods	72,252		66,113
Total inventories	$	190,414	$	170,719

Property, Plant, and Equipment, Net [Table Text Block]

Property, plant, and equipment, net	June 30, 2013			December 31, 2012
	(in thousands)
Machinery and equipment	$	290,500		$	287,791
Computers and software	88,186			84,980
Buildings, furniture, and improvements	143,420			146,191
Land	24,663			25,318
Construction in progress, including purchased equipment	33,529			26,097
Total cost	580,298			570,377
Accumulated depreciation	(330,926		)	(315,165		)
Property, plant, and equipment, net	$	249,372		$	255,212

Depreciation Expense and Capitalized interest [Table Text Block]

Depreciation expense and capitalized interest	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Depreciation expense	$	14,027	$	15,019	$	28,040	$	30,333
Capitalized interest	21		—		64		—

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Derivative Financial Instruments Offsetting of Derivative Liabilities (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Offsetting Liabilities [Line Items]
Gross Amounts of Recognized Liabilities Presented in the Consolidated Balance Sheets	$ 1,590	$ 2,839
Derivative Financial Instruments Not Offset in the Consolidated Balance Sheets	(122)	(135)
Cash Collateral Pledged Not Offset in the Consolidated Balance Sheets	0	0
Net Amount	$ 1,468	$ 2,704

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Intangible Assets Summary of Intangible Asset Account Activity (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Intangible Assets [Line Items]
Beginning balance, intangible assets, gross	$ 802,540	$ 749,194
Intangible assets acquired		43,400
Effect of change in exchange rates	(16,894)	(13,835)
Ending balance, intangible assets, gross	784,146	778,759
Customer contracts and relationships [Member] | Adjustment of Intangible Customer Relationship Asset Acquired [Member]
Intangible Assets [Line Items]
Intangible assets acquired	$ (1,500)

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Other Comprehensive Income (Loss) (Text Block)

6 Months Ended

Jun. 30, 2013

Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract]

Other Comprehensive Income (Loss) [Text Block]

Other Comprehensive Income (Loss)

OCI is reflected as a net increase (decrease) to Itron, Inc. shareholders’ equity and is not reflected in our results of operations. The before-tax amount, income tax (provision) benefit, and net-of-tax amount related to each component of other comprehensive income (loss) during the reporting periods were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Before-tax amount
Foreign currency translation adjustment	$	6,798		$	(52,847	)	$	(20,649	)	$	(24,145	)
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	1,336			(1,365		)	1,244			(1,365		)
Pension plan benefits liability adjustment	263			19			(283		)	38
Total other comprehensive income (loss), before tax	8,397			(54,193		)	(19,688		)	(25,472		)
Tax (provision) benefit
Foreign currency translation adjustment	377			476			(3,471		)	315
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	(491		)	516			(472		)	516
Pension plan benefits liability adjustment	(80		)	3			86			7
Total other comprehensive income (loss) tax (provision) benefit	(194		)	995			(3,857		)	838
Net-of-tax amount
Foreign currency translation adjustment	7,175			(52,371		)	(24,120		)	(23,830		)
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	845			(849		)	772			(849		)
Pension plan benefits liability adjustment	183			22			(197		)	45
Total other comprehensive income (loss), net of tax	$	8,203		$	(53,198	)	$	(23,545	)	$	(24,634	)

The changes in the components of accumulated other comprehensive income (loss) (AOCI), net of tax, were as follows:

	Foreign Currency Translation Adjustments			Net Unrealized Gain (Loss) on Derivative Instruments			Net Unrealized Gain (Loss) on Nonderivative Instruments			Pension Plan Benefit Liability Adjustments			Total
	(in thousands)
Balances at January 1, 2012	$	(24,718	)	$	—		$	(14,380	)	$	1,938		$	(37,160	)
OCI before reclassifications	(23,830		)	(849		)	—			—			(24,679		)
Amounts reclassified from AOCI	—			—			—			45			45
Total other comprehensive income (loss)	(23,830		)	(849		)	—			45			(24,634		)
Balances at June 30, 2012	$	(48,548	)	$	(849	)	$	(14,380	)	$	1,983		$	(61,794	)
Balances at January 1, 2013	$	(3,313	)	$	(1,689	)	$	(14,380	)	$	(15,002	)	$	(34,384	)
OCI before reclassifications	(24,120		)	772			—			(566		)	(23,914		)
Amounts reclassified from AOCI	—			—			—			369			369
Total other comprehensive income (loss)	(24,120		)	772			—			(197		)	(23,545		)
Balances at June 30, 2013	$	(27,433	)	$	(917	)	$	(14,380	)	$	(15,199	)	$	(57,929	)

Details about the AOCI components reclassified to the Consolidated Statements of Operations during the reporting periods are as follows:

	Amount Reclassified from AOCI(1)
	Three Months Ended June 30,						Six Months Ended June 30,						Affected Line Item in the Income Statement
	2013			2012			2013			2012
	(in thousands)
Amortization of defined benefit pension items
Prior-service costs	$	(17	)	$	(17	)	(34		)	(34		)	(2)
Actuarial losses	(246		)	(2		)	(497		)	(4		)	(2)
Total, before tax	(263		)	(19		)	(531		)	(38		)	Income before income taxes
Tax benefit (provision)	80			(3		)	162			(7		)	Income tax provision
Total, net of tax	(183		)	(22		)	(369		)	(45		)	Net income
Total reclassifications for the period, net of tax	$	(183	)	$	(22	)	$	(369	)	$	(45	)	Net income

⁽¹⁾ Amounts in parenthesis indicate debits to the Statements of Operations.

⁽²⁾  These AOCI components are included in the computation of net periodic pension cost. Refer to Note 8 for additional details.

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Commitments and Contingencies Warranty Expense (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Total warranty expense	$ 5,572	$ (263)	$ 8,460	$ 7,697

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Certain Balance Sheet Components Accounts Receivable, Net, Additional Information (Details) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Accounts Receivable, Net (Line Items]
Number of months current retainage amounts and unbilled receivables are expected to be collected	12 months
Current retainage contract receivables [Member]
Accounts Receivable, Net (Line Items]
Contract Receivable Retainage, Due One Year or Less	$ 19,000,000	$ 20,000,000
Unbilled Contracts Receivable	11,100,000	11,100,000
Long Term Retainage Contract Receivables [Member]
Accounts Receivable, Net (Line Items]
Contract Receivable Retainage, Due after Next Rolling Twelve Months	0	0
Long-term unbilled retainage receivables	$ 0	$ 0

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Stock-Based Compensation Unrestricted Stock Awards Summary (Details) (Unrestricted Stock Award [Member], USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Unrestricted Stock Award [Member]
[Line Items]
Shares of unrestricted stock granted	4,518	4,526	8,847	9,979
Weighted average grant date fair value per share	$ 45.37	$ 45.26	$ 45.40	$ 41.05

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Intangible Assets Intangible Asset Narrative (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2013 Core Developed Technology [Member]	Jun. 30, 2013 Adjustment of Intangible Customer Relationship Asset Acquired [Member] Customer contracts and relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life		7 years
Finite-lived Intangible Assets Acquired	$ 43,400		$ (1,500)

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Property, Plant, and Equipment Policy Additional Information (Details)	6 Months Ended
	Jun. 30, 2013
Building and Building Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	30 years
Minimum [Member] | Machinery and Equipment, Computers and Software, and Furniture [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	3 years
Maximum [Member] | Machinery and Equipment, Computers and Software, and Furniture [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	10 years

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Debt Debt (Tables)

6 Months Ended

Jun. 30, 2013

Debt Disclosure [Abstract]

Schedule of Debt [Table Text Block]

The components of our borrowings were as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Credit facility:
USD denominated term loan	$	270,000	$	277,500
Multicurrency revolving line of credit	140,000		140,000
Total debt	410,000		417,500
Less: current portion of debt	22,500		18,750
Long-term debt	$	387,500	$	398,750

Schedule of Long-Term Debt Repayments [Table Text Block]

Total credit facility repayments were as follows:

	Six Months Ended June 30,
	2013		2012
	(in thousands)
Term loan	$	7,500	$	7,502
Multicurrency revolving line of credit (1)	15,000		60,000
Total credit facility repayments	$	22,500	$	67,502

⁽¹⁾ We borrowed $15.0 million and $70.0 million under the multicurrency revolving line of credit during the six months ended June 30, 2013 and 2012.

Prepaid Debt Fees [Table Text Block]

Unamortized prepaid debt fees were as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Unamortized prepaid debt fees	$	4,588	$	5,367

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Goodwill Schedule of Goodwill Allocated to Reporting Segments (Tables)

6 Months Ended

Jun. 30, 2013

Goodwill [Line Items]

Schedule of Goodwill [Table Text Block]

The following table reflects the goodwill balance as of June 30, 2013:

	Energy			Water			Total Company
	(in thousands)
Balance at January 1, 2013
Goodwill before impairment	$	859,454		$	414,394		$	1,273,848
Accumulated impairment losses	(249,502		)	(323,330		)	(572,832		)
Goodwill, net	609,952			91,064			701,016
Adjustments of previous acquisition	3,958			—			3,958
Effect of change in exchange rates	(7,551		)	(1,208		)	(8,759		)
Balance at June 30, 2013
Goodwill before impairment	851,471			407,497			1,258,968
Accumulated impairment losses	(245,112		)	(317,641		)	(562,753		)
Goodwill, net	$	606,359		$	89,856		$	696,215

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Other Comprehensive Income Reclassifications from Accumulated Other Comprehensive Income (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2013		Jun. 30, 2012		Jun. 30, 2013		Jun. 30, 2012
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items]
Prior-service costs	$ (17)		$ (17)		$ (34)		$ (34)
Actuarial losses	246		2		497		4
Income before income taxes	14,092		42,855		14,345		78,056
Tax benefit (provision)	(1,896)		(10,564)		1,347		(20,193)
Total, net of tax	12,196		32,291		15,692		57,863
Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items]
Total, net of tax	(183)	[1]	(22)	[1]	(369)	[1]	(45)	[1]
Accumulated Defined Benefit Plans Adjustment [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items]
Prior-service costs	(17)	[1],[2]	(17)	[1],[2]	(34)	[1],[2]	(34)	[1],[2]
Actuarial losses	(246)	[1],[2]	(2)	[1],[2]	(497)	[1],[2]	(4)	[1],[2]
Income before income taxes	(263)	[1]	(19)	[1]	(531)	[1]	(38)	[1]
Tax benefit (provision)	80	[1]	(3)	[1]	162	[1]	(7)	[1]
Total, net of tax	$ (183)	[1]	$ (22)	[1]	$ (369)	[1]	$ (45)	[1]

[1] Amounts in parenthesis indicate debits to the Statements of Operations.

[2] These AOCI components are included in the computation of net periodic pension cost. Refer to Note 8 for additional details.

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Certain Balance Sheet Components Accounts Receivable, Net (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Accounts Receivable, Net (Line Items]
Trade receivables (net of allowance of $6,948 and $7,372)	$ 330,956	$ 329,352
Unbilled receivables	41,284	45,974
Total accounts receivable, net	$ 372,240	$ 375,326

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Other Comprehensive Income Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2013

Other Comprehensive Income (Loss) [Abstract]

Total Comprehensive Income (Loss) [Table Text Block]

The before-tax amount, income tax (provision) benefit, and net-of-tax amount related to each component of other comprehensive income (loss) during the reporting periods were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Before-tax amount
Foreign currency translation adjustment	$	6,798		$	(52,847	)	$	(20,649	)	$	(24,145	)
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	1,336			(1,365		)	1,244			(1,365		)
Pension plan benefits liability adjustment	263			19			(283		)	38
Total other comprehensive income (loss), before tax	8,397			(54,193		)	(19,688		)	(25,472		)
Tax (provision) benefit
Foreign currency translation adjustment	377			476			(3,471		)	315
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	(491		)	516			(472		)	516
Pension plan benefits liability adjustment	(80		)	3			86			7
Total other comprehensive income (loss) tax (provision) benefit	(194		)	995			(3,857		)	838
Net-of-tax amount
Foreign currency translation adjustment	7,175			(52,371		)	(24,120		)	(23,830		)
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	845			(849		)	772			(849		)
Pension plan benefits liability adjustment	183			22			(197		)	45
Total other comprehensive income (loss), net of tax	$	8,203		$	(53,198	)	$	(23,545	)	$	(24,634	)

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

The changes in the components of accumulated other comprehensive income (loss) (AOCI), net of tax, were as follows:

	Foreign Currency Translation Adjustments			Net Unrealized Gain (Loss) on Derivative Instruments			Net Unrealized Gain (Loss) on Nonderivative Instruments			Pension Plan Benefit Liability Adjustments			Total
	(in thousands)
Balances at January 1, 2012	$	(24,718	)	$	—		$	(14,380	)	$	1,938		$	(37,160	)
OCI before reclassifications	(23,830		)	(849		)	—			—			(24,679		)
Amounts reclassified from AOCI	—			—			—			45			45
Total other comprehensive income (loss)	(23,830		)	(849		)	—			45			(24,634		)
Balances at June 30, 2012	$	(48,548	)	$	(849	)	$	(14,380	)	$	1,983		$	(61,794	)
Balances at January 1, 2013	$	(3,313	)	$	(1,689	)	$	(14,380	)	$	(15,002	)	$	(34,384	)
OCI before reclassifications	(24,120		)	772			—			(566		)	(23,914		)
Amounts reclassified from AOCI	—			—			—			369			369
Total other comprehensive income (loss)	(24,120		)	772			—			(197		)	(23,545		)
Balances at June 30, 2013	$	(27,433	)	$	(917	)	$	(14,380	)	$	(15,199	)	$	(57,929	)

Reclassification out of Accumulated Other Comprehensive Income [Table Text Block]

Details about the AOCI components reclassified to the Consolidated Statements of Operations during the reporting periods are as follows:

	Amount Reclassified from AOCI(1)
	Three Months Ended June 30,						Six Months Ended June 30,						Affected Line Item in the Income Statement
	2013			2012			2013			2012
	(in thousands)
Amortization of defined benefit pension items
Prior-service costs	$	(17	)	$	(17	)	(34		)	(34		)	(2)
Actuarial losses	(246		)	(2		)	(497		)	(4		)	(2)
Total, before tax	(263		)	(19		)	(531		)	(38		)	Income before income taxes
Tax benefit (provision)	80			(3		)	162			(7		)	Income tax provision
Total, net of tax	(183		)	(22		)	(369		)	(45		)	Net income
Total reclassifications for the period, net of tax	$	(183	)	$	(22	)	$	(369	)	$	(45	)	Net income

⁽¹⁾ Amounts in parenthesis indicate debits to the Statements of Operations.

⁽²⁾  These AOCI components are included in the computation of net periodic pension cost. Refer to Note 8 for additional details.

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Revenue Recognition Policy Additional Information (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Deferred Revenue Arrangement [Line Items]
Deferred Revenue	$ 83.7	$ 74.9
Deferred Costs	$ 27.7	$ 24.4

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Certain Balance Sheet Components Summary of the Allowance for Doubtful Accounts (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Summary of Allowance for Doubtful Accounts Activity [Line Items]
Beginning balance	$ 6,144	$ 5,983	$ 7,372	$ 6,049
Provision (release) of doubtful accounts, net	1,075	(230)	171	(290)
Accounts written-off	(198)	(22)	(303)	(261)
Effects of change in exchange rates	(73)	(350)	(292)	(117)
Ending balance	$ 6,948	$ 5,381	$ 6,948	$ 5,381

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Income Taxes Income Taxes (Tables)

6 Months Ended

Jun. 30, 2013

Income Tax Uncertainties [Abstract]

Unrecognized Tax Benefits Related To Uncertain Tax Positions [Table Text Block]

We classify interest expense and penalties related to unrecognized tax liabilities and interest income on tax overpayments as components of income tax expense. The net interest and penalties expense recognized is as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
	(in thousands)
Net interest and penalties expense	$	168	$	(22	)	$	339	$	265

Accrued interest and penalties recorded are as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Accrued interest	$	3,251	$	3,095
Accrued penalties	3,009		3,030

Unrecognized tax benefits related to uncertain tax positions and the amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate are as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Unrecognized tax benefits related to uncertain tax positions	$	26,853	$	26,433
The amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate	26,141		25,852

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Debt Credit Facility Additional Information (Details) (USD $)		6 Months Ended				6 Months Ended
	Jun. 30, 2013	Jun. 30, 2013 Secured Debt [Member]	Aug. 05, 2011	Jun. 30, 2013 Multicurrency revolving line of credit (1)	Dec. 31, 2012 Multicurrency revolving line of credit (1)	Jun. 30, 2013 Minimum [Member]	Jun. 30, 2013 Maximum [Member]	Jun. 30, 2013 Alternate base rate (1) [Member]	Jun. 30, 2013 Alternate base rate (2) [Member]	Jun. 30, 2013 Alternate base rate (3) [Member]	Jun. 30, 2013 LIBOR interest rate [Member]	Jun. 30, 2013 Multicurrency revolving line of credit (1)	Jun. 30, 2012 Multicurrency revolving line of credit (1)	Jun. 30, 2013 Scheduled Quarterly Repayments September 2013 through June 2014 [Domain]	Jun. 30, 2013 Scheduled Quarterly Repayments September 2014 through June 2016 [Domain]
Debt Instrument [Line Items]
Debt Instrument, Face Amount			$ 300,000,000
Line of credit facility, maximum borrowing capacity	660,000,000
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage						0.20%	0.40%
Debt Instrument, Collateral		All obligations under the credit facility are guaranteed by Itron, Inc. and material U.S. domestic subsidiaries and are secured by a pledge of substantially all of the assets of Itron, Inc. and material U.S. domestic subsidiaries, including a pledge of 100% of the capital stock of material U.S. domestic subsidiaries and up to 66% of the voting stock (100% of the non-voting stock) of their first-tier foreign subsidiaries. In addition, the obligations of any foreign subsidiary who is a foreign borrower, as defined by the credit facility, are guaranteed by the foreign subsidiary and by its direct and indirect foreign parents.
Repayments of Secured Debt														5,600,000	7,500,000
Debt Instrument, Description of Variable Rate Basis								the prime rate	the Federal Reserve effective rate	one month LIBOR	the LIBOR rate
Debt Instrument, Basis Spread on Variable Rate									0.50%	1.00%	1.25%
Applicable Interest Rate											1.45%
Proceeds from Lines of Credit												15,000,000	70,000,000
Line of credit facility, amount outstanding				140,000,000	140,000,000
Letters of Credit Outstanding, Amount				47,000,000
Line of credit facility, remaining borrowing capacity				$ 473,000,000

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Defined Benefit Pension Plans Schedule of Amounts Recognized in the Consolidated Balance Sheets (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Schedule of Amounts Recognized in the Consolidated Balance Sheets [Line Items]
Plan assets in other long-term assets	$ (226)	$ (227)
Current portion of pension plan liability in wages and benefits payable	3,157	2,899
Long-term portion of pension plan liability	89,948	90,533
Net pension plan benefit liability	$ (92,879)	$ (93,205)

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Debt Schedule of Unamortized Prepaid Debt Fees (Details) (Secured Debt [Member], USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Secured Debt [Member]
Debt Instrument [Line Items]
Unamortized prepaid debt fees	$ 4,588	$ 5,367

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Earnings Per Share and Capital Structure Stock-based Awards (Details) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock-based awards excluded from diluted EPS calculation (antidilutive)	1.1	1.4	1.2	1.3

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Derivative Financial Instruments Derivative Financial Instruments Narrative (Details) (USD $)			6 Months Ended															6 Months Ended
	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2013 Forward Contracts [Member]	Jun. 30, 2013 Secured Debt [Member]	Dec. 31, 2012 Secured Debt [Member]	Jun. 30, 2013 Interest Rate Swap [Member] contracts	Jun. 30, 2013 Foreign Exchange Contract [Member] Not Designated as Hedging Instrument [Member] Minimum [Member]	Jun. 30, 2013 Foreign Exchange Contract [Member] Not Designated as Hedging Instrument [Member] Maximum [Member]	Jun. 30, 2013 Accumulated Other Comprehensive Income, Net Unrealized Gain (Loss) on Nonderivative Instruments [Member]	Dec. 31, 2012 Accumulated Other Comprehensive Income, Net Unrealized Gain (Loss) on Nonderivative Instruments [Member]	Jun. 30, 2012 Accumulated Other Comprehensive Income, Net Unrealized Gain (Loss) on Nonderivative Instruments [Member]	Dec. 31, 2011 Accumulated Other Comprehensive Income, Net Unrealized Gain (Loss) on Nonderivative Instruments [Member]	Jun. 30, 2012 Accumulated Other Comprehensive Income, Net Unrealized Gain (Loss) on Nonderivative Instruments [Member] Net Investment Hedging [Member]	Jun. 30, 2013 Accumulated Net Gain (Loss) from Derivative Instruments Designated as Hedging Instruments [Member]	Dec. 31, 2012 Accumulated Net Gain (Loss) from Derivative Instruments Designated as Hedging Instruments [Member]	Jun. 30, 2012 Accumulated Net Gain (Loss) from Derivative Instruments Designated as Hedging Instruments [Member]	Dec. 31, 2011 Accumulated Net Gain (Loss) from Derivative Instruments Designated as Hedging Instruments [Member]	Jun. 30, 2013 Number of Counterparties [Member]
Description of Derivative Activity Volume			a total of 247 contracts were entered into															Our derivative assets and liabilities consist of foreign exchange forward and interest rate swap contracts with nine counterparties at June 30, 2013 and eight counterparties at December 31, 2012.
Net unrealized loss on hedging instruments	$ 57,929,000	$ 34,384,000							$ 14,380,000	$ 14,380,000	$ 14,380,000	$ 14,380,000	$ 14,400,000	$ 15,297,000	$ 16,069,000	$ 15,229,000	$ 14,380,000
Number of Interest Rate Derivatives Held						6
Derivative, Notional Amount						200,000,000	251,000	11,000,000
Pay fixed interest rate in interst rate swap						1.00%
Interest Rate Cash Flow Hedge Gain (Loss) to be Reclassified During Next 12 Months, Net						(1,300,000)
Long-term Debt				$ 410,000,000	$ 417,500,000

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Restructuring Restructuring Related Balance Sheet Activity (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Restructuring Cost and Reserve [Line Items]
Beginning balance, January 1, 2013			$ 17,714
Costs incurred and charged to expense	3,385	7,720	4,398	8,509
Cash payments			(3,988)
Non-cash items			(27)
Effect of change in exchange rates			(475)
Ending balance, June 30, 2013	17,622		17,622
Accrued Employee Severance [Member]
Restructuring Cost and Reserve [Line Items]
Beginning balance, January 1, 2013			14,498
Costs incurred and charged to expense			2,654
Cash payments			(3,155)
Non-cash items			0
Effect of change in exchange rates			(447)
Ending balance, June 30, 2013	13,550		13,550
Asset Impairment and Net (Gain) Loss on Sale or Disposal [Member]
Restructuring Cost and Reserve [Line Items]
Beginning balance, January 1, 2013			0
Costs incurred and charged to expense			27
Cash payments			0
Non-cash items			(27)
Effect of change in exchange rates			0
Ending balance, June 30, 2013	0		0
Other Accrued Costs [Member]
Restructuring Cost and Reserve [Line Items]
Beginning balance, January 1, 2013			3,216
Costs incurred and charged to expense			1,717
Cash payments			(833)
Non-cash items			0
Effect of change in exchange rates			(28)
Ending balance, June 30, 2013	$ 4,072		$ 4,072

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Restructuring Restructuring Additional Information (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Restructuring Cost and Reserve [Line Items]
Restructuring Reserve, Current	$ 13.9	$ 13.2
Restructuring Reserve, Noncurrent	$ 3.7	$ 4.5

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Other Comprehensive Income Other Comprehensive Income (Loss) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Before-tax amount [Abstract]
Foreign currency translation adjustment	$ 6,798	$ (52,847)	$ (20,649)	$ (24,145)
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	1,336	(1,365)	1,244	(1,365)
Pension plan benefits liability adjustment	263	19	(283)	38
Total other comprehensive income (loss), before tax	8,397	(54,193)	(19,688)	(25,472)
Tax (provision) benefit [Abstract]
Foreign currency translation adjustment	377	476	(3,471)	315
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	(491)	516	(472)	516
Pension plan benefits liability adjustment	(80)	3	86	7
Total other comprehensive income (loss) tax (provision) benefit	(194)	995	(3,857)	838
Net-of-tax amount [Abstract]
Foreign currency translation adjustment	7,175	(52,371)	(24,120)	(23,830)
Net unrealized gain (loss) on derivative instruments designated as cash flow hedges	845	(849)	772	(849)
Pension plan benefits liability adjustment	183	22	(197)	45
Total other comprehensive income (loss), net of tax	$ 8,203	$ (53,198)	$ (23,545)	$ (24,634)

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Intangible Assets Schedule of Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2013

Schedule of Intangible Assets [Abstract]

Schedule of Intangible Assets by Major Class [Table Text Block]

The gross carrying amount and accumulated amortization of our intangible assets, other than goodwill, are as follows:

	June 30, 2013							December 31, 2012
	Gross Assets		Accumulated Amortization			Net		Gross Assets		Accumulated Amortization			Net
	(in thousands)
Core-developed technology	$	420,055	$	(338,145	)	$	81,910	$	407,024	$	(332,763	)	$	74,261
Customer contracts and relationships	281,644		(159,231		)	122,413		292,252		(154,890		)	137,362
Trademarks and trade names	71,356		(64,897		)	6,459		72,770		(65,090		)	7,680
Other	11,091		(11,024		)	67		11,094		(11,026		)	68
Total intangible assets subject to amortization	784,146		(573,297		)	210,849		783,140		(563,769		)	219,371
In-process research and development	—					—		19,400					19,400
Total intangible assets	$	784,146	$	(573,297	)	$	210,849	$	802,540	$	(563,769	)	$	238,771

Summary of Intangible Asset Account Activity [Table Text Block]

A summary of the intangible asset account activity is as follows:

	Six Months Ended June 30,
	2013			2012
	(in thousands)
Beginning balance, intangible assets, gross	$	802,540		$	749,194
Intangible assets acquired	(1,500		)	43,400
Effect of change in exchange rates	(16,894		)	(13,835		)
Ending balance, intangible assets, gross	$	784,146		$	778,759

Schedule of Intangible Assets, Future Amortization Expense [Table Text Block]

Estimated future annual amortization expense is as follows:

Years ending December 31,	Estimated Annual Amortization
	(in thousands)
2013 (amount remaining at June 30, 2013)	$	20,734
2014	43,434
2015	34,800
2016	27,345
2017	20,314
Beyond 2017	64,222
Total intangible assets, net	$	210,849

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Summary of Significant Accounting Policies (Text Block)

6 Months Ended

Jun. 30, 2013

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

Summary of Significant Accounting Policies

We were incorporated in the state of Washington in 1977. We provide a portfolio of products and services to utilities for the energy and water markets throughout the world.

Financial Statement Preparation

The condensed consolidated financial statements presented in this Quarterly Report on Form 10-Q are unaudited and reflect entries necessary for the fair presentation of the Consolidated Statements of Operations and the Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended June 30, 2013 and 2012, the Consolidated Balance Sheets as of June 30, 2013 and December 31, 2012, and the Consolidated Statements of Cash Flows for the six months ended June 30, 2013 and 2012 of Itron, Inc. and its subsidiaries. All entries required for the fair presentation of the financial statements are of a normal recurring nature, except as disclosed.

Certain information and notes normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) regarding interim results. These condensed consolidated financial statements should be read in conjunction with the 2012 audited financial statements and notes included in our Annual Report on Form 10-K filed with the SEC on February 22, 2013. The results of operations for the three and six months ended June 30, 2013 are not necessarily indicative of the results expected for the full fiscal year or for any other fiscal period.

Basis of Consolidation

We consolidate all entities in which we have a greater than 50% ownership interest or in which we exercise control over the operations. We use the equity method of accounting for entities in which we have a 50% or less investment and exercise significant influence. Entities in which we have less than a 20% investment and where we do not exercise significant influence are accounted for under the cost method. Intercompany transactions and balances are eliminated upon consolidation.

Noncontrolling Interests

In several of our consolidated international subsidiaries, we have joint venture partners, who are minority shareholders. Although these entities are not wholly-owned by Itron, we consolidate them because we have a greater than 50% ownership interest or because we exercise control over the operations. The noncontrolling interest balance is adjusted each period to reflect the allocation of net income (loss) and other comprehensive income (loss) attributable to the noncontrolling interests, as shown in our Consolidated Statements of Operations and our Consolidated Statements of Comprehensive Income (Loss). The noncontrolling interest balance in our Consolidated Balance Sheets represents the proportional share of the equity of the joint venture entities, which is attributable to the minority shareholders.

Business Acquisitions

On May 1, 2012, we completed the acquisition of SmartSynch, Inc. (SmartSynch). SmartSynch provides smart grid solutions that utilize cellular networks for communications.

In January 2011, we completed the acquisition of a software and consulting services company in France, which included contingent and deferred consideration amounts that were paid in the first quarters of 2012 and 2013. See Business Combinations policy below.

Cash and Cash Equivalents

We consider all highly liquid instruments with remaining maturities of three months or less at the date of acquisition to be cash equivalents.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded for invoices issued to customers in accordance with our contractual arrangements. Interest and late payment fees are minimal. Unbilled receivables are recorded when revenues are recognized upon product shipment or service delivery and invoicing occurs at a later date. We record an allowance for doubtful accounts representing our estimate of the probable losses in accounts receivable at the date of the balance sheet based on our historical experience of bad debts and our specific review of outstanding receivables. Accounts receivable are written-off against the allowance when we believe an account, or a portion thereof, is no longer collectible.

Inventories

Inventories are stated at the lower of cost or market using the first-in, first-out method. Cost includes raw materials and labor, plus applied direct and indirect costs.

Derivative Instruments

All derivative instruments, whether designated in hedging relationships or not, are recorded on the Consolidated Balance Sheets at fair value as either assets or liabilities. The components and fair values of our derivative instruments are determined using the fair value measurements of significant other observable inputs (Level 2), as defined by GAAP. The net fair value of our derivative instruments may switch between a net asset and a net liability depending on market circumstances at the end of the period. We include the effect of our counterparty credit risk based on current published credit default swap rates when the net fair value of our derivative instruments are in a net asset position and the effect of our own nonperformance risk when the net fair value of our derivative instruments are in a net liability position.

For any derivative designated as a fair value hedge, the changes in the fair value of the derivative and of the hedged item attributable to the hedged risk are recognized in earnings. For any derivative designated as a cash flow hedge, the effective portions of changes in the fair value of the derivative are recorded as a component of other comprehensive income (loss) (OCI) and are recognized in earnings when the hedged item affects earnings. Ineffective portions of cash flow hedges are recognized in other income (expense) in the Consolidated Statements of Operations. For a hedge of a net investment, the effective portion of any unrealized gain or loss from the foreign currency revaluation of the hedging instrument is reported in OCI as a net unrealized gain or loss on derivative instruments. Upon termination of a net investment hedge, the net derivative gain/loss will remain in accumulated OCI until such time when earnings are impacted by a sale or liquidation of the associated operations. Ineffective portions of fair value changes or the changes in fair value of derivative instruments that do not qualify for hedging activities are recognized in other income (expense) in the Consolidated Statements of Operations. We classify cash flows from our derivative programs as cash flows from operating activities in the Consolidated Statements of Cash Flows.

Derivatives are not used for trading or speculative purposes. Our derivatives are with credit-worthy multinational commercial banks, with whom we have master netting agreements; however, our derivative positions are not disclosed on a net basis. There are no credit-risk-related contingent features within our derivative instruments. Refer to Note 7 and Note 13 for further disclosures of our derivative instruments and their impact on OCI.

Property, Plant, and Equipment

Property, plant, and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally 30 years for buildings and improvements and three to ten years for machinery and equipment, computers and software, and furniture. Leasehold improvements are capitalized and depreciated over the term of the applicable lease, including renewable periods if reasonably assured, or over the useful lives, whichever is shorter. Construction in process represents capital expenditures incurred for assets not yet placed in service. Costs related to internally developed software and software purchased for internal uses are capitalized and are amortized over the estimated useful lives of the assets. Repair and maintenance costs are expensed as incurred. We have no major planned maintenance activities.

We review long-lived assets for impairment whenever events or circumstances indicate the carrying amount of an asset group may not be recoverable. Assets held for sale are classified within other current assets in the Consolidated Balance Sheets, are reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. Gains and losses from asset disposals and impairment losses are classified within the Consolidated Statement of Operations according to the use of the asset, except those gains and losses recognized in conjunction with our restructuring activities, which are classified as restructuring expense.

Prepaid Debt Fees

Prepaid debt fees represent the capitalized direct costs incurred related to the issuance of debt and are recorded as noncurrent assets. These costs are amortized to interest expense over the lives of the respective borrowings, including contingent maturity or call features, using the effective interest method, or straight-line method when associated with a revolving credit facility. When debt is repaid early, the related portion of unamortized prepaid debt fees is written off and included in interest expense.

Business Combinations

On the date of acquisition, the assets acquired, liabilities assumed, and any noncontrolling interests in the acquiree are recorded at their fair values. The acquiree's results of operations are also included as of the date of acquisition in our consolidated results. Intangible assets that arise from contractual/legal rights, or are capable of being separated, as well as in-process research and development (IPR&D), are measured and recorded at fair value, and amortized over the estimated useful life. IPR&D is not amortized until such time as the associated development projects are completed or terminated. If a development project is completed, the IPR&D is reclassified as a core technology intangible asset and amortized over its estimated useful life. If the development project is terminated, the recorded value of the associated IPR&D is immediately expensed. If practicable, assets acquired and liabilities assumed arising from contingencies are measured and recorded at fair value. If not practicable, such assets and liabilities are measured and recorded when it is probable that a gain or loss has occurred and the amount can be reasonably estimated. The residual balance of the purchase price, after fair value allocations to all identified assets and liabilities, represents goodwill. Acquisition-related costs are expensed as incurred. Restructuring costs associated with an acquisition are generally expensed in periods subsequent to the acquisition date, and changes in deferred tax asset valuation allowances and acquired income tax uncertainties, including penalties and interest, after the measurement period are recognized as a component of the provision for income taxes. Our acquisitions may include contingent consideration, which require us to recognize the fair value of the estimated liability at the time of the acquisition. Subsequent changes in the estimate of the amount to be paid under the contingent consideration arrangement are recognized in the consolidated statements of operations. Cash payments for contingent or deferred consideration are classified within cash flows from investing activities within the consolidated statements of cash flows.

Goodwill and Intangible Assets

Goodwill and intangible assets may result from our acquisitions. We use estimates, including estimates of useful lives of intangible assets, the amount and timing of related future cash flows, and fair values of the related operations, in determining the value assigned to goodwill and intangible assets. Our finite-lived intangible assets are amortized over their estimated useful lives based on estimated discounted cash flows. IPR&D is considered an indefinite-lived intangible asset and is not subject to amortization until the associated projects are completed or terminated. Finite-lived intangible assets are tested for impairment at the asset group level when events or changes in circumstances indicate the carrying value may not be recoverable. Indefinite-lived intangible assets are tested for impairment annually, when events or changes in circumstances indicate the asset may be impaired, or at the time when their useful lives are determined to be no longer indefinite.

Goodwill is assigned to our reporting units based on the expected benefit from the synergies arising from each business combination, determined by using certain financial metrics, including the forecasted discounted cash flows associated with each reporting unit.

We test goodwill for impairment each year as of October 1, or more frequently should a significant impairment indicator occur. As part of the impairment test, we may elect to perform an assessment of qualitative factors. If this qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit, including goodwill, is less than its carrying amount, or if we elect to bypass the qualitative assessment, we would then proceed with the two-step impairment test. The impairment test involves comparing the fair values of the reporting units to their carrying amounts. If the carrying amount of a reporting unit exceeds its fair value, a second step is required to measure the goodwill impairment loss amount. This second step determines the current fair values of all assets and liabilities of the reporting unit and then compares the implied fair value of the reporting unit's goodwill to the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in an amount equal to the excess.

Determining the fair value of a reporting unit is judgmental in nature and involves the use of significant estimates and assumptions. We forecast discounted future cash flows at the reporting unit level using risk-adjusted discount rates and estimated future revenues and operating costs, which take into consideration factors such as existing backlog, expected future orders, supplier contracts, and expectations of competitive and economic environments. We also identify similar publicly traded companies and develop a correlation, referred to as a multiple, to apply to the operating results of the reporting units. These combined fair values are then reconciled to the aggregate market value of our common stock on the date of valuation, while considering a reasonable control premium.

Contingencies

A loss contingency is recorded if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. We evaluate, among other factors, the degree of probability of an unfavorable outcome and our ability to make a reasonable estimate of the amount of the ultimate loss. Loss contingencies that we determine to be reasonably possible, but not probable, are disclosed but not recorded. Changes in these factors and related estimates could materially affect our financial position and results of operations. Legal costs to defend against contingent liabilities are expensed as incurred.

Bonus and Profit Sharing

We have various employee bonus and profit sharing plans, which provide award amounts for the achievement of annual financial and nonfinancial targets. If management determines it is probable that the targets will be achieved, and the amounts can be reasonably estimated, a compensation accrual is recorded based on the proportional achievement of the financial and nonfinancial targets. Although we monitor and accrue expenses quarterly based on our progress toward the achievement of the annual targets, the actual results at the end of the year may require awards that are significantly greater or less than the estimates made in earlier quarters.

Warranty

We offer standard warranties on our hardware products and large application software products. We accrue the estimated cost of new product warranties based on historical and projected product performance trends and costs during the warranty period. Testing of new products in the development stage helps identify and correct potential warranty issues prior to manufacturing. Continuing quality control efforts during manufacturing reduce our exposure to warranty claims. When our quality control efforts fail to detect a fault in one of our products, we experience an increase in warranty claims. We track warranty claims to identify potential warranty trends. If an unusual trend is noted, an additional warranty accrual may be assessed and recorded when a failure event is probable and the cost can be reasonably estimated. When new products are introduced, our process relies on historical averages of similar products until sufficient data is available. As actual experience becomes available, it is used to modify the original estimate to ensure the expected warranty costs are within a range of likely outcomes. Management continually evaluates the sufficiency of the warranty provisions and makes adjustments when necessary. The warranty allowances may fluctuate due to higher than anticipated material, labor, and other costs we may incur to repair or replace projected product failures, and we may incur additional warranty and related expenses in the future with respect to new or established products, which could adversely affect our financial position and results of operations. The long-term warranty balance includes estimated warranty claims beyond one year. Warranty expense is classified within cost of revenues.

Restructuring and Asset Impairments

We record a liability for costs associated with an exit or disposal activity at its fair value in the period in which the liability is incurred. Employee termination benefits considered postemployement benefits are accrued when the obligation is probable and estimable, such as benefits stipulated by human resource policies and practices or statutory requirements. One-time termination benefits are expensed at the date the employee is notified. If the employee must provide future service greater than 60 days, such benefits are expensed ratably over the future service period. For contract termination costs, we record a liability upon the later of when we terminate a contract in accordance with the contract terms or when we cease using the rights conveyed by the contract.

Asset impairments are determined at the asset group level. An impairment may be recorded for assets that are to be abandoned, are to be sold for less than net book value, or are held for sale in which the estimated proceeds less costs to sell are less than the net book value. We may also recognize impairment on an asset group, which is held and used, when the carrying value is not recoverable and exceeds the asset group's fair value. If an asset group is considered a business, a portion of the Company's goodwill balance is allocated to it based on relative fair value.

Defined Benefit Pension Plans

We sponsor both funded and unfunded defined benefit pension plans for certain international employees. We recognize a liability for the projected benefit obligation in excess of plan assets or an asset for plan assets in excess of the projected benefit obligation. We also recognize the funded status of our defined benefit pension plans on our Consolidated Balance Sheets and recognize as a component of OCI, net of tax, the actuarial gains or losses and prior service costs or credits, if any, that arise during the period but that are not recognized as components of net periodic benefit cost.

Share Repurchase Plan

We may repurchase up to $50 million of shares of Itron common stock under a twelve-month program, which was authorized by our Board of Directors on March 8, 2013. Share repurchases are made in the open market or in privately negotiated transactions and in accordance with applicable securities laws. Under applicable Washington State law, shares repurchased are retired and not displayed separately as treasury stock on the financial statements; the value of the repurchased shares is deducted from common stock.

Revenue Recognition

Revenues consist primarily of hardware sales, software license fees, software implementation, project management services, installation, consulting, and post-sale maintenance support. Revenues are recognized when (1) persuasive evidence of an arrangement exists, (2) delivery has occurred or services have been rendered, (3) the sales price is fixed or determinable, and (4) collectability is reasonably assured.

The majority of our revenue arrangements involve multiple deliverables, which combine two or more of the following: hardware, meter reading system software, installation, and/or project management services. Revenue arrangements with multiple deliverables are divided into separate units of accounting if the delivered item(s) has value to the customer on a standalone basis and delivery/performance of the undelivered item(s) is probable. The total arrangement consideration is allocated among the separate units of accounting based on their relative fair values and the applicable revenue recognition criteria considered for each unit of accounting. The amount allocable to a delivered item is limited to the amount that we are entitled to collect and that is not contingent upon the delivery/performance of additional items. Revenues for each deliverable are then recognized based on the type of deliverable, such as 1) when the products are shipped, 2) services are delivered, 3) percentage-of-completion when implementation services are essential to other deliverables in the arrangement, 4) upon receipt of customer acceptance, or 5) transfer of title and risk of loss. The majority of our revenue is recognized when products are shipped to or received by a customer or when services are provided.

If, among other factors, the data collection system does not use standard internet protocols and network design services are deemed complex and extensive, hardware revenues are recognized at the time of shipment, receipt by customer, or, if applicable, upon completion of customer acceptance provisions. Revenue from network software and services is recognized using the units-of-delivery method of contract accounting, as network design services and network software are essential to the functionality of the related hardware (network). This methodology results in the deferral of costs and revenues as professional services and software implementation commence prior to deployment of hardware.

In all other instances, hardware revenues are recognized at the time of shipment, receipt by customer, or, if applicable, upon completion of customer acceptance provisions. Network software is recognized when shipped if all other revenue recognition criteria are met and services are not essential to the functionality of the software. If implementation services are essential to the functionality of the network software, software and implementation revenues are recognized using the percentage-of-completion methodology of contract accounting when project costs are reliably estimated.

We also enter into multiple deliverable software arrangements that do not include hardware. For this type of arrangement, revenue recognition is dependent upon the availability of vendor specific objective evidence (VSOE) of fair value for each of the deliverables. The lack of VSOE, or the existence of extended payment terms or other inherent risks, may affect the timing of revenue recognition for multiple deliverable software arrangements.

Certain of our revenue arrangements include an extended or noncustomary warranty provision that covers all or a portion of a customer's replacement or repair costs beyond the standard or customary warranty period. Whether or not the extended warranty is separately priced in the arrangement, a portion of the arrangement's total consideration is allocated to this extended warranty deliverable. This revenue is deferred and recognized over the extended warranty coverage period. Extended or noncustomary warranties do not represent a significant portion of our revenue.

We allocate consideration to each deliverable in an arrangement based on its relative selling price. We determine selling price using VSOE, if it exists, otherwise we use third-party evidence (TPE). We define VSOE as a median price of recent standalone transactions that are priced within a narrow range. TPE is determined based on the prices charged by our competitors for a similar deliverable when sold separately. If neither VSOE nor TPE of selling price exists for a unit of accounting, we use estimated selling price (ESP) to determine the price at which we would transact if the product or service were regularly sold by us on a standalone basis. Our determination of ESP involves a weighting of several factors based on the specific facts and circumstances of the arrangement. The factors considered include the cost to produce the deliverable, the anticipated margin on that deliverable, our ongoing pricing strategy and policies, and the characteristics of the varying markets in which the deliverable is sold.

We analyze the selling prices used in our allocation of arrangement consideration on an annual basis. Selling prices are analyzed on a more frequent basis if a significant change in our business necessitates a more timely analysis or if we experience significant variances in our selling prices.

Unearned revenue is recorded when a customer pays for products or services, but the criteria for revenue recognition have not been met as of the balance sheet date. Unearned revenues of $83.7 million and $74.9 million at June 30, 2013 and December 31, 2012 related primarily to professional services and software associated with our smart metering contracts, extended or noncustomary warranty, and prepaid post-contract support. Deferred costs are recorded for products or services for which ownership (typically defined as title and risk of loss) has transferred to the customer, but the criteria for revenue recognition have not been met as of the balance sheet date. Deferred costs were $27.7 million and $24.4 million at June 30, 2013 and December 31, 2012 and are recorded within other assets in the Consolidated Balance Sheets.

Hardware and software post-sale maintenance support fees are recognized ratably over the life of the related service contract. Shipping and handling costs and incidental expenses billed to customers are recorded as revenue, with the associated cost charged to cost of revenues. We record sales, use, and value added taxes billed to our customers on a net basis.

Product and Software Development Costs

Product and software development costs primarily include employee compensation and third party contracting fees. We do not capitalize product development costs, and we do not generally capitalize software development expenses as the costs incurred are immaterial for the relatively short period of time between technological feasibility and the completion of software development.

Stock-Based Compensation

We measure and recognize compensation expense for all stock-based awards made to employees and directors, including stock options, stock sold pursuant to our Employee Stock Purchase Plan (ESPP), and the issuance of restricted stock units and unrestricted stock awards, based on estimated fair values. The fair value of stock options is estimated at the date of grant using the Black-Scholes option-pricing model, which includes assumptions for the dividend yield, expected volatility, risk-free interest rate, and expected term. For ESPP awards, the fair value is the difference between the market close price of our common stock on the date of purchase and the discounted purchase price. For performance-based restricted stock units and unrestricted stock awards with no market conditions, the fair value is the market close price of our common stock on the date of grant. For restricted stock units with market conditions, the fair value is estimated at the date of award using a Monte Carlo simulation model, which includes assumptions for dividend yield and expected volatility for our common stock and the common stock for companies within the Russell 3000 index, as well as the risk-free interest rate and expected term of the awards. We expense stock-based compensation at the date of grant for unrestricted stock awards. For awards with only a service condition, we expense stock-based compensation, adjusted for estimated forfeitures, using the straight-line method over the requisite service period for the entire award. For awards with performance and service conditions, if vesting is probable, we expense the stock-based compensation, adjusted for estimated forfeitures, on a straight-line basis over the requisite service period for each separately vesting portion of the award. For awards with a market condition, we expense the fair value over the requisite service period. Excess tax benefits are credited to common stock when the deduction reduces cash taxes payable. When we have tax deductions in excess of the compensation cost, they are classified as financing cash inflows in the Consolidated Statements of Cash Flows.

Income Taxes

We compute our interim income tax provision through the use of an estimated annual effective tax rate (ETR) applied to year-to-date operating results and specific events that are discretely recognized as they occur. In determining the estimated annual ETR, we analyze various factors, including the forecasted mix of earnings in domestic and international jurisdictions, new or revised tax legislation and accounting pronouncements, tax credits, state income taxes, adjustments to valuation allowances, and uncertain tax positions, amount other items. Discrete items, including the effect of changes in tax laws, tax rates, and certain circumstances with respect to valuation allowances or other unusual or non-recurring tax adjustments, are reflected in the period in which they occur as an addition to, or reduction from, the income tax provision, rather than included in the estimated annual ETR.

Deferred tax assets and liabilities are recognized based upon anticipated future tax consequences, in each of the jurisdictions in which we operate, attributable to: (1) the differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases; and (2) operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The calculation of our tax liabilities involves applying complex tax regulations in different jurisdictions to our tax positions. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying amount of deferred tax assets if it is more likely than not that such assets will not be realized. We do not record tax liabilities on undistributed earnings of international subsidiaries that are permanently reinvested.

We utilize a two step approach to account for uncertain tax positions. A tax position is first evaluated for recognition based on its technical merits. Tax positions that have a greater than fifty percent likelihood of being realized upon ultimate settlement are then measured to determine amounts to be recognized in the financial statements. This measurement incorporates information about potential settlements with taxing authorities. A previously recognized tax position is derecognized in the first period in which the position no longer meets the more-likely-than-not recognition threshold or upon expiration of the statute of limitations. We classify interest expense and penalties related to uncertain tax positions and interest income on tax overpayments as part of income tax expense.

Foreign Exchange

Our consolidated financial statements are reported in U.S. dollars. Assets and liabilities of international subsidiaries with non-U.S. dollar functional currencies are translated to U.S. dollars at the exchange rates in effect on the balance sheet date, or the last business day of the period, if applicable. Revenues and expenses for each subsidiary are translated to U.S. dollars using a weighted average rate for the relevant reporting period. Translation adjustments resulting from this process are included, net of tax, in OCI. Gains and losses that arise from exchange rate fluctuations for monetary asset and liability balances that are not denominated in an entity’s functional currency are included within other income (expense), net in the Consolidated Statements of Operations. Currency gains and losses of intercompany balances deemed to be long-term in nature or designated as a hedge of the net investment in international subsidiaries are included, net of tax, in OCI.

Fair Value Measurements

For assets and liabilities measured at fair value, the GAAP fair value hierarchy prioritizes the inputs used in different valuation methodologies, assigning the highest priority to unadjusted quoted prices for identical assets and liabilities in actively traded markets (Level 1) and the lowest priority to unobservable inputs (Level 3). Level 2 inputs consist of quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in non-active markets; and model-derived valuations in which significant inputs are corroborated by observable market data either directly or indirectly through correlation or other means. Inputs may include yield curves, volatility, credit risks, and default rates.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Due to various factors affecting future costs and operations, actual results could differ materially from these estimates.

New Accounting Pronouncements

The Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2013.11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists" on July 18, 2013. The ASU concludes an unrecognized tax benefit should be presented as a reduction of a deferred tax asset when settlement in this manner is available under the law. We will adopt this amendment as of January 2014. The result of adoption may be to reclassify certain long term liabilities to long term deferred tax assets, and the adoption will not result in a change to the tax provision. Management does not believe that the impact on the balance sheet will be significant.

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Certain Balance Sheet Components (Text Block)

6 Months Ended

Jun. 30, 2013

Balance Sheet Related Disclosures [Abstract]

Certain Balance Sheet Components [Text Block]

Certain Balance Sheet Components

Accounts receivable, net	June 30, 2013		December 31, 2012
	(in thousands)
Trade receivables (net of allowance of $6,948 and $7,372)	$	330,956	$	329,352
Unbilled receivables	41,284		45,974
Total accounts receivable, net	$	372,240	$	375,326

At June 30, 2013 and December 31, 2012, $19.0 million and $20.0 million were recorded within trade receivables as billed but not yet paid by customers, in accordance with contract retainage provisions. At June 30, 2013 and December 31, 2012, contract retainage amounts that were unbilled and classified as unbilled receivables were $11.1 million. We had no long-term unbilled receivables or long-term retainage contract receivables at June 30, 2013 and December 31, 2012, as we expect to collect all contract retainage receivables within the following 12 months.

Allowance for doubtful account activity	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Beginning balance	$	6,144		$	5,983		$	7,372		$	6,049
Provision (release) of doubtful accounts, net	1,075			(230		)	171			(290		)
Accounts written-off	(198		)	(22		)	(303		)	(261		)
Effects of change in exchange rates	(73		)	(350		)	(292		)	(117		)
Ending balance	$	6,948		$	5,381		$	6,948		$	5,381

Inventories	June 30, 2013		December 31, 2012
	(in thousands)
Materials	$	104,283	$	92,038
Work in process	13,879		12,568
Finished goods	72,252		66,113
Total inventories	$	190,414	$	170,719

Our inventory levels may vary period to period as a result of our factory scheduling and the timing of contract fulfillments, which may include the buildup of finished goods for shipment.

Consigned inventory is held at third-party locations; however, we retain title to the inventory until purchased by the third-party. Consigned inventory, consisting of raw materials and finished goods, was $5.7 million and $5.0 million at June 30, 2013 and December 31, 2012, respectively.

Property, plant, and equipment, net	June 30, 2013			December 31, 2012
	(in thousands)
Machinery and equipment	$	290,500		$	287,791
Computers and software	88,186			84,980
Buildings, furniture, and improvements	143,420			146,191
Land	24,663			25,318
Construction in progress, including purchased equipment	33,529			26,097
Total cost	580,298			570,377
Accumulated depreciation	(330,926		)	(315,165		)
Property, plant, and equipment, net	$	249,372		$	255,212

Depreciation expense and capitalized interest	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Depreciation expense	$	14,027	$	15,019	$	28,040	$	30,333
Capitalized interest	21		—		64		—

In conjunction with the upgrade of our global enterprise resource planning software systems, we have capitalized $11.1 million within construction in progress at June 30, 2013. Amounts capitalized include internal labor costs and related benefits, software, third-party consulting fees, and $21,000 and $64,000 of interest for the three and six months ended June 30, 2013, respectively.

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Debt (Text Block)

6 Months Ended

Jun. 30, 2013

Debt Disclosure [Abstract]

Debt [Text Block]

Debt

The components of our borrowings were as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Credit facility:
USD denominated term loan	$	270,000	$	277,500
Multicurrency revolving line of credit	140,000		140,000
Total debt	410,000		417,500
Less: current portion of debt	22,500		18,750
Long-term debt	$	387,500	$	398,750

Credit Facility

Our credit facility is dated August 5, 2011. The credit facility consists of a $300 million U.S. dollar term loan (the term loan) and a multicurrency revolving line of credit (the revolver) with a principal amount of up to $660 million. Both the term loan and the revolver mature on August 8, 2016, and amounts borrowed under the revolver are classified as long-term. Amounts borrowed under the revolver during the credit facility term may be repaid and reborrowed until the revolver's maturity, at which time the revolver will terminate, and all outstanding loans, together with all accrued and unpaid interest, must be repaid. Amounts not borrowed under the revolver are subject to a commitment fee, which is paid in arrears on the last day of each fiscal quarter, ranging from 0.20% to 0.40% per annum depending on our total leverage ratio as of the most recently ended fiscal quarter. Amounts repaid on the term loan may not be reborrowed. The credit facility permits us and certain of our foreign subsidiaries to borrow in U.S. dollars, euros, British pounds, or, with lender approval, other currencies readily convertible into U.S. dollars. All obligations under the credit facility are guaranteed by Itron, Inc. and material U.S. domestic subsidiaries and are secured by a pledge of substantially all of the assets of Itron, Inc. and material U.S. domestic subsidiaries, including a pledge of 100% of the capital stock of material U.S. domestic subsidiaries and up to 66% of the voting stock (100% of the non-voting stock) of their first-tier foreign subsidiaries. In addition, the obligations of any foreign subsidiary who is a foreign borrower, as defined by the credit facility, are guaranteed by the foreign subsidiary and by its direct and indirect foreign parents. The credit facility includes debt covenants, which contain certain financial ratios and place certain restrictions on the incurrence of debt, investments, and the issuance of dividends. We were in compliance with the debt covenants under the credit facility at June 30, 2013.

Scheduled principal repayments for the term loan are due quarterly in the amounts of $5.6 million from September 2013 through June 2014 and $7.5 million from September 2014 through June 2016, with the remainder due at maturity on August 8, 2016. The term loan may be repaid early in whole or in part, subject to certain minimum thresholds, without penalty.

Under the credit facility, we elect applicable market interest rates for both the term loan and any outstanding revolving loans. We also pay an applicable margin, which is based on our total leverage ratio (as defined in the credit agreement). The applicable rates per annum may be based on either: (1) the LIBOR rate, plus an applicable margin, or (2) the Alternate Base Rate, plus an applicable margin. The Alternate Base Rate election is equal to the greatest of three rates: (i) the prime rate, (ii) the Federal Reserve effective rate plus 1/2 of 1%, or (iii) one month LIBOR plus 1%. At June 30, 2013, the interest rate for both the term loan and the revolver was 1.45% (the LIBOR rate plus a margin of 1.25%).

Total credit facility repayments were as follows:

	Six Months Ended June 30,
	2013		2012
	(in thousands)
Term loan	$	7,500	$	7,502
Multicurrency revolving line of credit (1)	15,000		60,000
Total credit facility repayments	$	22,500	$	67,502

⁽¹⁾ We borrowed $15.0 million and $70.0 million under the multicurrency revolving line of credit during the six months ended June 30, 2013 and 2012.

At June 30, 2013, $140.0 million was outstanding under the credit facility revolver, and $47.0 million was utilized by outstanding standby letters of credit, resulting in $473.0 million available for additional borrowings.

Unamortized prepaid debt fees were as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Unamortized prepaid debt fees	$	4,588	$	5,367

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Defined Benefit Pension Plans Schedule of Net Periodic Pension Benefit Costs (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Schedule of Net Periodic Pension Benefit Costs [Line Items]
Service cost	$ 1,011	$ 676	$ 1,992	$ 1,414
Interest cost	786	909	1,586	1,835
Expected return on plan assets	(79)	(82)	(158)	(167)
Settlements and other	0	0	(814)	0
Amortization of actuarial net loss	246	2	497	4
Amortization of unrecognized prior service costs	17	17	34	34
Net periodic benefit cost	$ 1,981	$ 1,522	$ 3,137	$ 3,120

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Intangible Assets (Text Block)

6 Months Ended

Jun. 30, 2013

Intangible Assets, Net (Excluding Goodwill) [Abstract]

Intangible Assets [Text Block]

Intangible Assets

The gross carrying amount and accumulated amortization of our intangible assets, other than goodwill, are as follows:

	June 30, 2013							December 31, 2012
	Gross Assets		Accumulated Amortization			Net		Gross Assets		Accumulated Amortization			Net
	(in thousands)
Core-developed technology	$	420,055	$	(338,145	)	$	81,910	$	407,024	$	(332,763	)	$	74,261
Customer contracts and relationships	281,644		(159,231		)	122,413		292,252		(154,890		)	137,362
Trademarks and trade names	71,356		(64,897		)	6,459		72,770		(65,090		)	7,680
Other	11,091		(11,024		)	67		11,094		(11,026		)	68
Total intangible assets subject to amortization	784,146		(573,297		)	210,849		783,140		(563,769		)	219,371
In-process research and development	—					—		19,400					19,400
Total intangible assets	$	784,146	$	(573,297	)	$	210,849	$	802,540	$	(563,769	)	$	238,771

A summary of the intangible asset account activity is as follows:

	Six Months Ended June 30,
	2013			2012
	(in thousands)
Beginning balance, intangible assets, gross	$	802,540		$	749,194
Intangible assets acquired	(1,500		)	43,400
Effect of change in exchange rates	(16,894		)	(13,835		)
Ending balance, intangible assets, gross	$	784,146		$	778,759

Intangible assets acquired in 2012 were related to the SmartSynch acquisition on May 1, 2012, including IPR&D assets that consisted primarily of projects to upgrade the hardware components of cellular communication modules to be compatible with 3G cellular network standards. Upon completion of these projects in March 2013, we performed a qualitative assessment and determined that it was more than likely that the carrying amount of IPR&D was not impaired. Accordingly, the carrying amount of IPR&D was reclassified as core-developed technology and will be amortized over its expected useful life of seven years based on the SmartSynch acquisition discounted cash flow valuation model. For the six months ended June 30, 2013, the adjustment of $1.5 million to intangible assets acquired is associated with the correction of an error for a long-term revenue contract from the SmartSynch acquisition. See Note 5 for further discussion of the correction of the error and its impact on goodwill.

Intangible assets of our international subsidiaries are recorded in their respective functional currency; therefore, the carrying amounts of intangible assets increase or decrease, with a corresponding change in accumulated OCI, due to changes in foreign currency exchange rates.

Estimated future annual amortization expense is as follows:

Years ending December 31,	Estimated Annual Amortization
	(in thousands)
2013 (amount remaining at June 30, 2013)	$	20,734
2014	43,434
2015	34,800
2016	27,345
2017	20,314
Beyond 2017	64,222
Total intangible assets, net	$	210,849

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Income Tax Policy Additional Information (Details) (Minimum [Member])	6 Months Ended
	Jun. 30, 2013
Minimum [Member]
Income Tax Contingency [Line Items]
Income Tax Examination Likelihood Of Favorable Settlement Minimum For Recognition	50.00%

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Derivative Financial Instruments Derivative Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2013

Derivative Financial Instruments [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]

The fair values of our derivative instruments at June 30, 2013 and December 31, 2012 were as follows:

		Fair Value
	Balance Sheet Location	June 30, 2013		December 31, 2012
		(in thousands)
Asset Derivatives
Derivatives not designated as hedging instruments under ASC 815-20
Foreign exchange forward contracts	Other current assets	$	122	$	146
Liability Derivatives
Derivatives designated as hedging instruments under ASC 815-20
Interest rate swap contracts	Other current liabilities	$	1,348	$	629
Interest rate swap contracts	Other long-term obligations	134		2,096
Derivatives not designated as hedging instruments under ASC 815-20
Foreign exchange forward contracts	Other current liabilities	108		114
Total liability derivatives		$	1,590	$	2,839

Offsetting Assets [Table Text Block]

Offsetting of Derivative Assets
			Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Assets Presented in the Consolidated Balance Sheets		Derivative Financial Instruments			Cash Collateral Received		Net Amount
	(in thousands)
June 30, 2013	$	122	$	(122	)	$	—	$	—
December 31, 2012	$	146	$	(135	)	$	—	$	11

Offsetting Liabilities [Table Text Block]

Offsetting of Derivative Liabilities
			Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Liabilities Presented in the Consolidated Balance Sheets		Derivative Financial Instruments			Cash Collateral Pledged		Net Amount
	(in thousands)
June 30, 2013	$	1,590	$	(122	)	$	—	$	1,468
December 31, 2012	$	2,839	$	(135	)	$	—	$	2,704

Accumulated OCI for Derivative and Nonderivative Instruments Designated as Hedging Instruments, Net of Tax [Table Text Block]

OCI during the reporting periods for our derivative hedging instruments, net of tax, was as follows:

	2013			2012
	(in thousands)
Net unrealized loss on hedging instruments at January 1,	$	(16,069	)	$	(14,380	)
Unrealized gain (loss) on derivative instruments	772			(849		)
Net unrealized loss on hedging instruments at June 30,	$	(15,297	)	$	(15,229	)

Effect of Cash Flow Derivatives on the Balance Sheet and Income Statement, Before Tax [Table Text Block]

The before-tax effect of our cash flow derivative instruments on the Consolidated Balance Sheets and the Consolidated Statements of Operations for the three and six months ended June 30 were as follows:

Derivatives in ASC 815-20 Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in OCI on Derivative  (Effective Portion)					Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)					Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
						Location	Amount				Location	Amount
	2013		2012				2013		2012			2013		2012
	(in thousands)						(in thousands)					(in thousands)
Three Months Ended June 30,
Interest rate swap contracts	$	1,336	$	(1,365	)	Interest expense	$	—	$	—	Interest expense	$	—	$	—
Six Months Ended June 30,
Interest rate swap contracts	$	1,244	$	(1,365	)	Interest expense	$	—	$	—	Interest Expense	$	—	$	—

Foreign Exchange Derivatives Not Designated As Hedging Instruments [Table Text Block]

The effect of our foreign exchange forward derivative instruments on the Consolidated Statements of Operations for the three and six months ended June 30 was as follows:

Derivatives Not Designated as Hedging Instrument under ASC 815-20	Gain (Loss) Recognized on Derivatives in Other Income (Expense)
	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Foreign exchange forward contracts	$	(971	)	$	(244	)	$	(757	)	$	(421	)

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Commitments and Contingencies Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2013

Commitments and Contingencies Disclosure [Abstract]

Schedule of Line of Credit Facilities [Table Text Block]

Our available lines of credit, outstanding standby LOCs, and bonds are as follows:

	June 30, 2013			December 31, 2012
	(in thousands)
Credit facilities(1)
Multicurrency revolving line of credit	$	660,000		$	660,000
Long-term borrowings	(140,000		)	(140,000		)
Standby LOCs issued and outstanding	(47,037		)	(54,328		)
Net available for additional borrowings and LOCs	$	472,963		$	465,672
Unsecured multicurrency revolving lines of credit with various financial institutions
Multicurrency revolving lines of credit	$	97,456		$	67,308
Standby LOCs issued and outstanding	(29,581		)	(29,906		)
Short-term borrowings(2)	(2,731		)	(851		)
Net available for additional borrowings and LOCs	$	65,144		$	36,551
Unsecured surety bonds in force	$	136,934		$	164,820

⁽¹⁾  See Note 6 for details regarding our secured credit facilities.

⁽²⁾  Short-term borrowings are included in "Other current liabilities" on the Consolidated Balance Sheets.

Schedule of Warranty Accruals [Table Text Block]

A summary of the warranty accrual account activity is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Beginning balance	$	50,754		$	77,251		$	53,605		$	79,536
New product warranties	1,961			3,507			2,822			5,636
Other changes/adjustments to warranties	3,611			(3,770		)	5,638			2,061
Claims activity	(5,289		)	(8,255		)	(10,388		)	(19,575		)
Effect of change in exchange rates	(405		)	(2,365		)	(1,045		)	(1,290		)
Ending balance	50,632			66,368			50,632			66,368
Less: current portion of warranty	24,709			42,861			24,709			42,861
Long-term warranty	$	25,923		$	23,507		$	25,923		$	23,507

Warranty Expense [Table Text Block]

Warranty expense for the three and six months ended June 30 is as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
	(in thousands)
Total warranty expense	$	5,572	$	(263	)	$	8,460	$	7,697

Schedule of Changes to Unearned Revenue for Extended Warranty [Table Text Block]

A summary of changes to unearned revenue for extended warranty contracts is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Beginning balance	$	32,363		$	27,140		$	31,960		$	24,448
Unearned revenue for new extended warranties	1,664			2,243			2,625			5,189
Unearned revenue recognized	(525		)	(331		)	(995		)	(631		)
Effect of change in exchange rates	(107		)	(41		)	(195		)	5
Ending balance	33,395			29,011			33,395			29,011
Less: current portion of unearned revenue for extended warranty	2,472			1,572			2,472			1,572
Long-term unearned revenue for extended warranty within Other long-term obligations	$	30,923		$	27,439		$	30,923		$	27,439

Health Benefit Plan Costs and Incurred But Not Reported Accrual Balance [Table Text Block]

Each reporting period, we expense the costs of our health insurance plan including paid claims, the change in the estimate of incurred but not reported (IBNR) claims, taxes, and administrative fees (collectively, the plan costs).

Plan costs are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Plan costs	$	5,662	$	7,217	$	10,500	$	12,878

The IBNR accrual, which is included in wages and benefits payable, is as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
IBNR accrual	$	2,345	$	2,552

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Derivative Financial Instruments Derivatives Not Designated as Hedging Relationships (Details) (Other Income (Expense) [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Other Income (Expense) [Member]
Derivative Instruments Not Designated as Hedging Instruments [Abstract]
Foreign exchange forward contracts	$ (971)	$ (244)	$ (757)	$ (421)

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Segment Information Major Customers (Details)	6 Months Ended
	Jun. 30, 2013
Revenue, Major Customer [Line Items]
Segment Reporting, Disclosure of Major Customers	For the three and six months ended June 30, 2013, no single customer represented more than 10% of the total Company, the Energy operating segment, or the Water operating segment revenues. For the three and six months ended June 30, 2012, one customer from the Energy operating segment accounted for 11% of the total Company revenues. During the same periods, one customer accounted for 15% of the Energy operating segment revenues, and no single customer accounted for more than 10% of the Water operating segment revenues.

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Basis of Consolidation Policy Additional Information (Details)	3 Months Ended	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2013
Maximum [Member]
Ownership Interest to be Held for Consolidation [Line Items]
Ownership Interest To Use Equity Method		50.00%
Ownership Interest To Use Cost Method		20.00%
Minimum [Member]
Ownership Interest to be Held for Consolidation [Line Items]
Ownership Interest to be Held for Consolidation	50.00%	50.00%
Ownership Interest to be Held for Consolidation - Noncontrolling Interests	50.00%	50.00%

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Derivative Financial Instruments Effect of Cash Flow Derivatives on the Balance Sheet and Income Statement, Before Tax (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Interest Rate Swap Contracts [Abstract]
Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion)	$ 1,336	$ (1,365)	$ 1,244	$ (1,365)
Interest Expense [Member]
Interest Rate Swap Contracts [Abstract]
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)	0	0	0	0
Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)	$ 0	$ 0	$ 0	$ 0

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Restructuring Restructuring Long-lived Assets Measured at Fair Value (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Long Lived Assets Held-for-sale [Line Items]
Assets Held-for-sale, Long Lived	$ 3,128	$ 3,184
Impairment of Long-Lived Assets to be Disposed of	0	2
Fair Value, Inputs, Level 3 [Member]
Long Lived Assets Held-for-sale [Line Items]
Assets Held-for-sale, Long Lived, Fair Value Disclosure	$ 3,128	$ 3,184

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Intangible Assets Gross Carrying Amount and Accumulated Amortization (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2012	Dec. 31, 2011
Intangible Assets [Line Items]
Gross Assets	$ 784,146	$ 783,140
Accumulated Amortization	(573,297)	(563,769)
Net	210,849	219,371
Gross Assets (including IPR&D)	784,146	802,540	778,759	749,194
Net (including IPR&D)	210,849	238,771
Core-developed technology [Member]
Intangible Assets [Line Items]
Gross Assets	420,055	407,024
Accumulated Amortization	(338,145)	(332,763)
Net	81,910	74,261
Customer contracts and relationships [Member]
Intangible Assets [Line Items]
Gross Assets	281,644	292,252
Accumulated Amortization	(159,231)	(154,890)
Net	122,413	137,362
Trademarks and trade names [Member]
Intangible Assets [Line Items]
Gross Assets	71,356	72,770
Accumulated Amortization	(64,897)	(65,090)
Net	6,459	7,680
Other [Member]
Intangible Assets [Line Items]
Gross Assets	11,091	11,094
Accumulated Amortization	(11,024)	(11,026)
Net	67	68
In-process research and development
Intangible Assets [Line Items]
In-process research and development	$ 0	$ 19,400

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Certain Balance Sheet Components Inventories (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Inventories [Line Items]
Materials	$ 104,283	$ 92,038
Work in process	13,879	12,568
Finished goods	72,252	66,113
Total inventories	$ 190,414	$ 170,719

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Earnings Per Share and Capital Structure Stock Repurchase Plan (Details) (USD $) In Millions, except Share data, unless otherwise specified	0 Months Ended	4 Months Ended	6 Months Ended
	Mar. 08, 2013	Jun. 30, 2013	Jun. 30, 2013
Stock Repurchase Program, Authorized Amount	$ 50
Stock Repurchased and Retired During Period, Shares		384,800
Stock Repurchased and Retired During Period, Value		16.1
Stock Repurchase Program, Remaining Authorized Repurchase Amount			$ 33.9

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Consolidated Statements of Comprehensive Income (Loss) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Net income	$ 12,196	$ 32,291	$ 15,692	$ 57,863
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	7,180	(52,331)	(24,120)	(23,790)
Net unrealized gain (loss) on derivative instruments, designated as cash flow hedges	845	(849)	772	(849)
Pension plan benefit liability adjustment	183	22	(197)	45
Total other comprehensive income (loss), net of tax	8,208	(53,158)	(23,545)	(24,594)
Total comprehensive income (loss), net of tax	20,404	(20,867)	(7,853)	33,269
Comprehensive income (loss) attributable to noncontrolling interests, net of tax:
Net income (loss) attributable to noncontrolling interests	(203)	676	723	895
Foreign currency translation adjustments	5	40	0	40
Amounts attributable to noncontrolling interests	(198)	716	723	935
Comprehensive income (loss) attributable to Itron, Inc.	$ 20,602	$ (21,583)	$ (8,576)	$ 32,334

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Stock-Based Compensation (Text Block)

6 Months Ended

Jun. 30, 2013

Share-based Compensation, Allocation and Classification in Financial Statements [Abstract]

Stock-Based Compensation [Text Block]

Stock-Based Compensation

We record stock-based compensation expense for awards of stock options, stock sold pursuant to our ESPP, and the issuance of restricted stock units and unrestricted stock awards. We expense stock-based compensation primarily using the straight-line method over the requisite service period. Capitalized stock-based compensation amounts were not material for the three and six months ended June 30, 2013 and 2012. For the three and six months ended June 30, stock-based compensation expense and the related tax benefit were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Stock options	$	519	$	337	$	992	$	609
Restricted stock units	4,158		4,375		8,393		7,891
Unrestricted stock awards	205		205		402		410
ESPP	144		141		335		346
Total stock-based compensation	$	5,026	$	5,058	$	10,122	$	9,256
Related tax benefit	$	1,391	$	1,375	$	2,755	$	2,564

We issue new shares of common stock upon the exercise of stock options or when vesting conditions on restricted stock units are fully satisfied.

Subject to stock splits, dividends, and other similar events, 3,500,000 shares of common stock are reserved and authorized for issuance under our 2010 Stock Incentive Plan (Stock Incentive Plan). Awards consist of stock options, restricted stock units, and unrestricted stock awards. At June 30, 2013, 431,758 shares were available for grant under the Stock Incentive Plan. The Stock Incentive Plan shares are subject to a fungible share provision such that, with respect to grants made after December 31, 2009, the authorized share reserve is reduced by (i) one share for every one share subject to a stock option or share appreciation right granted under the Plan and (ii) 1.7 shares for every one share of common stock that was subject to an award other than an option or stock appreciation right.

Stock Options

Options to purchase our common stock are granted to employees and members of the Board of Directors with an exercise price equal to the market close price of the stock on the date the Board of Directors approves the grant. Options generally become exercisable in three equal annual installments beginning one year from the date of grant and generally expire 10 years from the date of grant. Compensation expense is recognized only for those options expected to vest, with forfeitures estimated based on our historical experience and future expectations.

The fair values of stock options granted were estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013(1)		2012(1)		2013		2012
Dividend yield	—	%	—	%	—	%	—	%
Expected volatility	—	%	—	%	38.1	%	42.7	%
Risk-free interest rate	—	%	—	%	1.0	%	0.9	%
Expected term (years)	—		—		5.45		5.14

⁽¹⁾  There were no employee stock options granted for the three months ended June 30, 2013 and 2012.

Expected volatility is based on a combination of the historical volatility of our common stock and the implied volatility of our traded options for the related expected term. We believe this combined approach is reflective of current and historical market conditions and is an appropriate indicator of expected volatility. The risk-free interest rate is the rate available as of the award date on zero-coupon U.S. government issues with a term equal to the expected life of the award. The expected life is the weighted average expected life of an award based on the period of time between the date the award is granted and the estimated date the award will be fully exercised. Factors considered in estimating the expected life include historical experience of similar awards, contractual terms, vesting schedules, and expectations of future employee behavior. We have not paid dividends in the past and do not plan to pay dividends in the foreseeable future.

A summary of our stock option activity for the six months ended June 30 is as follows:

	Shares		Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value (1)		Weighted Average Grant Date Fair Value
	(in thousands)				(years)	(in thousands)
Outstanding, January 1, 2012	1,109		$	55.97	4.51	$	2,323
Granted	54		48.23					$	18.64
Exercised	(28	)	20.32			$	576
Expired	(32	)	69.69
Outstanding, June 30, 2012	1,103		$	56.10	4.32	$	3,090
Outstanding, January 1, 2013	1,137		$	54.06	4.81	$	3,815
Granted	128		42.76					$	15.44
Exercised	(32	)	23.36			$	639
Expired	(8	)	49.92
Outstanding, June 30, 2013	1,225		$	53.71	4.99	$	2,388
Exercisable, June 30, 2013	901		$	57.52	3.43	$	2,186
Expected to vest, June 30, 2013	304		$	43.17	9.32	$	190

⁽¹⁾  The aggregate intrinsic value of outstanding stock options represents amounts that would have been received by the optionees had all in- the-money options been exercised on that date. Specifically, it is the amount by which the market value of Itron’s stock exceeded the exercise price of the outstanding in-the-money options before applicable income taxes, based on our closing stock price on the last business day of the period. The aggregate intrinsic value of stock options exercised during the period is calculated based on our stock price at the date of exercise.

As of June 30, 2013, total unrecognized stock-based compensation expense related to nonvested stock options was approximately $4.1 million, which is expected to be recognized over a weighted average period of approximately 2.3 years.

Restricted Stock Units

Certain employees, senior management, and members of the Board of Directors receive restricted stock units as a component of their total compensation. The fair value of a restricted stock unit is the market close price of our common stock on the date of grant. Restricted stock units generally vest over a three year period. Compensation expense, net of forfeitures, is recognized over the requisite service period.

Subsequent to vesting, the restricted stock units are converted into shares of our common stock on a one-for-one basis and issued to employees. We are entitled to an income tax deduction in an amount equal to the taxable income reported by the employees upon vesting of the restricted stock units.

Prior to 2013, the performance-based restricted stock units issued under the Long-Term Performance Restricted Stock Unit Award Agreement (Performance Award Agreement) were determined based on the attainment of certain performance goals after the end of the one-year performance period. During the year, if management determined that it was probable that the targets would be achieved, compensation expense, net of forfeitures, was recognized on a straight-line basis over the annual performance and subsequent vesting period for each separately vesting portion of the award. Performance awards typically vested and were released in three equal installments at the end of each year following attainment of the performance goals. For U.S. participants who retire during the vesting period, unvested restricted stock units immediately vest at the date of retirement. For the 2012 performance awards, no awards became eligible for vesting as minimum performance thresholds for the 2012 performance year were not met.

For 2013, the performance-based restricted stock units to be issued under the Performance Award Agreement are determined based on (1) our achievement of specified non-GAAP EPS targets, as established at the beginning of each year for each of the calendar years contained in the performance periods (2-year and 3-year awards) (the performance condition) and (2) our total shareholder return (TSR) relative to the TSR attained by companies that are included in the Russell 3000 Index during the performance periods (the market condition). Compensation expense, net of forfeitures, is recognized on a straight-line basis, and the units vest upon achievement of the performance condition, provided participants are employed by Itron at the end of the respective performance periods. For U.S. participants who retire during the performance period, a pro-rated number of restricted stock units (based on the number of days of employment during the performance period) immediately vest based on the attainment of the performance goals as assessed after the end of the performance period.

Depending on the level of achievement of the performance condition, the actual number of shares to be earned ranges between 0% and 160% of the awards originally granted. At the end of the 2-year and 3-year performance periods, if the performance conditions are achieved at or above threshold, the number of shares earned is further adjusted by a TSR multiplier payout percentage, which ranges between 75% and 125%, based on the market condition. Therefore, based on the attainment of the performance and market conditions, the actual number of shares that vest may range from 0% to 200% of the awards originally granted. Due to the presence of the TSR multiplier market condition, we utilize a Monte Carlo valuation model to determine the fair value of the awards at the grant date. This pricing model uses multiple simulations to evaluate the probability of our achievement of various stock price levels to determine our expected TSR performance ranking. The weighted-average assumptions used to estimate the fair value of performance-based restricted stock units awarded and the resulting weighted average fair-value are as follows:

	Three Months Ended June 30, 2013			Six Months Ended June 30, 2013
Dividend yield	—		%	—		%
Expected volatility	39.1		%	39.1		%
Risk-free interest rate	0.3		%	0.3		%
Expected term (years)	2.53			2.53
Weighted-average fair value	$	45.70		$	45.03

Expected volatility is based on the historical volatility of our common stock for the related expected term. We believe this approach is reflective of current and historical market conditions and is an appropriate indicator of expected volatility. The risk-free interest rate is the rate available as of the award date on zero-coupon U.S. government issues with a term equal to the expected term of the award. The expected term is the term of an award based on the period of time between the date of the award and the date the award is expected to vest. The expected term assumption is based upon the plan's performance period as of the date of the award. We have not paid dividends in the past and do not plan to pay dividends in the foreseeable future.

The following table summarizes restricted stock unit activity for the six months ended June 30:

	Number of Restricted Stock Units		Weighted Average  Grant Date Fair Value		Aggregate Intrinsic Value(1)
	(in thousands)				(in thousands)
Outstanding, January 1, 2012	625
Granted(2)	443		$	47.33
Released	(176	)			$	11,536
Forfeited	(28	)
Outstanding, June 30, 2012	864
Outstanding, January 1, 2013	774
Granted(2)	255		$	42.51
Released	(253	)			$	13,562
Forfeited	(11	)
Outstanding, June 30, 2013	765
Vested but not released, June 30, 2013	29				$	1,244
Expected to vest, June 30, 2013	672				$	28,496

⁽¹⁾  The aggregate intrinsic value is the market value of the stock, before applicable income taxes, based on the closing price on the stock release dates or at the end of the period for restricted stock units expected to vest.

⁽²⁾  Restricted stock units granted in 2012 and 2013 do not include awards under the Performance Award Agreement for the respective years, as these awards are not granted until final attainment of performance goals has been determined at the conclusion of the performance period, which had not occurred as of June 30, 2012 and 2013, respectively.

At June 30, 2013, unrecognized compensation expense on restricted stock units was $24.2 million, which is expected to be recognized over a weighted average period of approximately 1.9 years.

Unrestricted Stock Awards

We grant unrestricted stock awards to members of our Board of Directors as part of their compensation. Awards are fully vested and expensed when granted. The fair value of unrestricted stock awards is the market close price of our common stock on the date of grant.

The following table summarizes unrestricted stock award activity for the three and six months ended June 30:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Shares of unrestricted stock granted	4,518		4,526		8,847		9,979
Weighted average grant date fair value per share	$	45.37	$	45.26	$	45.40	$	41.05

Employee Stock Purchase Plan

Under the terms of the ESPP, employees can deduct up to 10% of their regular cash compensation to purchase our common stock at a 15% discount from the fair market value of the stock at the end of each fiscal quarter, subject to other limitations under the plan. The sale of the stock to the employees occurs at the beginning of the subsequent quarter.

The following table summarizes ESPP activity for the three and six months ended June 30:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Shares of stock sold to employees(1)	27,489		30,619		47,308		53,676
Weighted average fair value per ESPP award(2)	$	6.37	$	6.19	$	6.69	$	6.55

⁽¹⁾  Stock sold to employees during each fiscal quarter under the ESPP is associated with the offering period ending on the last day of the previous fiscal quarter.

⁽²⁾  Relating to awards associated with the offering period during the three and six months ended June 30.

At June 30, 2013, all compensation cost associated with the ESPP had been recognized. There were approximately 553,000 shares of common stock available for future issuance under the ESPP at June 30, 2013.

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Operating activities
Net income	$ 15,692	$ 57,863
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	49,031	54,271
Stock-based compensation	10,122	9,256
Amortization of prepaid debt fees	829	763
Deferred taxes, net	(11,543)	628
Restructuring expense, non-cash	27	1,487
Other adjustments, net	324	(11)
Changes in operating assets and liabilities, net of acquisition:
Accounts receivable	(4,278)	8,046
Inventories	(25,124)	(2,786)
Other current assets	(9,408)	(13,663)
Other long-term assets	4,489	3,559
Accounts payable, other current liabilities, and taxes payable	(10,280)	(5,817)
Wages and benefits payable	(5,661)	(11,244)
Unearned revenue	10,497	5,627
Warranty	(1,797)	(11,991)
Other operating, net	(3,946)	(3,598)
Net cash provided by operating activities	18,974	92,390
Investing activities
Acquisitions of property, plant, and equipment	(28,895)	(23,547)
Business acquisitions, net of cash and cash equivalents acquired	(860)	(79,605)
Other investing, net	241	3,993
Net cash used in investing activities	(29,514)	(99,159)
Financing activities
Proceeds from borrowings	15,000	70,000
Payments on debt	(22,500)	(67,502)
Issuance of common stock	2,590	2,407
Repurchase of common stock	(16,126)	(25,976)
Other financing, net	2,220	(271)
Net cash used in financing activities	(18,816)	(21,342)
Effect of foreign exchange rate changes on cash and cash equivalents	(3,393)	(2,175)
Decrease in cash and cash equivalents	(32,749)	(30,286)
Cash and cash equivalents at beginning of period	136,411	133,086
Cash and cash equivalents at end of period	103,662	102,800
Non-cash transactions:
Property, plant, and equipment purchased but not yet paid	7,284	4,364
Supplemental disclosure of cash flow information:
Income taxes, net	8,200	20,173
Interest, net of amounts capitalized	$ 3,804	$ 4,275

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Intangible Assets Estimated Future Annual Amortization Expense (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Finite-Lived Intangible Assets [Line Items]
2013 (amount remaining at June 30, 2013)	$ 20,734
2014	43,434
2015	34,800
2016	27,345
2017	20,314
Beyond 2017	64,222
Total intangible assets, net	$ 210,849	$ 219,371

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Consolidated Statements of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Revenues	$ 482,175	$ 579,140	$ 929,711	$ 1,150,780
Cost of revenues	322,587	382,395	630,000	770,930
Gross profit	159,588	196,745	299,711	379,850
Operating expenses
Sales and marketing	46,182	50,847	94,398	100,703
Product development	43,481	46,640	87,689	90,996
General and administrative	38,317	33,450	71,912	70,020
Amortization of intangible assets	10,247	12,025	20,991	23,938
Restructuring expense	3,385	7,720	4,398	8,509
Total operating expenses	141,612	150,682	279,388	294,166
Operating income	17,976	46,063	20,323	85,684
Other income (expense)
Interest income	194	177	1,255	370
Interest expense	(2,336)	(2,606)	(4,674)	(5,043)
Other income (expense), net	(1,742)	(779)	(2,559)	(2,955)
Total other income (expense)	(3,884)	(3,208)	(5,978)	(7,628)
Income before income taxes	14,092	42,855	14,345	78,056
Income tax benefit (provision)	(1,896)	(10,564)	1,347	(20,193)
Net income	12,196	32,291	15,692	57,863
Net income (loss) attributable to noncontrolling interests	(203)	676	723	895
Net income attributable to Itron, Inc.	$ 12,399	$ 31,615	$ 14,969	$ 56,968
Earnings per common share - Basic (in dollars per share)	$ 0.31	$ 0.79	$ 0.38	$ 1.43
Earnings per common share - Diluted (in dollars per share)	$ 0.31	$ 0.79	$ 0.38	$ 1.42
Weighted average common shares outstanding - Basic (in shares)	39,431	39,887	39,426	39,900
Weighted average common shares outstanding - Diluted (in shares)	39,678	40,126	39,724	40,170

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Certain Balance Sheet Components Consigned Inventory (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Consigned inventory [Line Items]
Consigned Inventory	$ 5.7	$ 5.0

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Stock-Based Compensation Restricted Stock Units Summary (Details) (Restricted Stock Units (RSUs) [Member], USD $) In Thousands, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2013		Jun. 30, 2012
[Line Items]
Outstanding, beginning balance, Number	774,000		625,000
Granted, Number	255,000	[1]	443,000	[1]
Weighted-average fair value	$ 42.51	[1]	$ 47.33	[1]
Forfeited, Number	(11,000)		(28,000)
Outstanding, ending balance, Number	765,000		864,000
Vested and Released [Member]
[Line Items]
Released, Number	(253,000)		(176,000)
Released, Aggregate Intrinsic Value	$ 13,562	[2]	$ 11,536	[2]
Vested but Not Released [Member]
[Line Items]
Released, Number	(29,000)
Released, Aggregate Intrinsic Value	1,244	[2]
Expected to Vest [Member]
[Line Items]
Outstanding, ending balance, Number	672,000
Expected to vest, Aggregate Intrinsic Value	$ 28,496	[2]

[1] Restricted stock units granted in 2012 and 2013 do not include awards under the Performance Award Agreement for the respective years, as these awards are not granted until final attainment of performance goals has been determined at the conclusion of the performance period, which had not occurred as of June 30, 2012 and 2013, respectively.

[2] The aggregate intrinsic value is the market value of the stock, before applicable income taxes, based on the closing price on the stock release dates or at the end of the period for restricted stock units expected to vest.

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Stock-Based Compensation Stock-Based Compensation Expense and Related Tax Benefit (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options	$ 519	$ 337	$ 992	$ 609
Restricted stock units	4,158	4,375	8,393	7,891
Unrestricted stock awards	205	205	402	410
ESPP	144	141	335	346
Total stock-based compensation	5,026	5,058	10,122	9,256
Related tax benefit	$ 1,391	$ 1,375	$ 2,755	$ 2,564

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Defined Benefit Pension Plans Defined Benefit Pension Plans (Tables)

6 Months Ended

Jun. 30, 2013

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

Schedule of Amounts Recognized in the Consolidated Balance Sheets [Table Text Block]

Amounts recognized on the Consolidated Balance Sheets consist of:

	June 30, 2013		December 31, 2012
	(in thousands)
Assets
Plan assets in other long-term assets	$	226	$	227
Liabilities
Current portion of pension plan liability in wages and benefits payable	3,157		2,899
Long-term portion of pension plan liability	89,948		90,533
Net pension plan benefit liability	$	92,879	$	93,205

Schedule of Net Periodic Pension Benefit Costs [Table Text Block]

Net periodic pension benefit costs for our plans include the following components:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Service cost	$	1,011		$	676		$	1,992		$	1,414
Interest cost	786			909			1,586			1,835
Expected return on plan assets	(79		)	(82		)	(158		)	(167		)
Settlements and other	—			—			(814		)	—
Amortization of actuarial net loss	246			2			497			4
Amortization of unrecognized prior service costs	17			17			34			34
Net periodic benefit cost	$	1,981		$	1,522		$	3,137		$	3,120

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Earnings Per Share and Capital Structure Earnings Per Share and Capital Structure (Tables)

6 Months Ended

Jun. 30, 2013

Earnings Per Share and Capital Structure [Abstract]

Computation of Basic and Diluted Earnings Per Share [Table Text Block]

The following table sets forth the computation of basic and diluted earnings per share (EPS):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands, except per share data)
Net income available to common shareholders	$	12,399	$	31,615	$	14,969	$	56,968
Weighted average common shares outstanding - Basic	39,431		39,887		39,426		39,900
Dilutive effect of stock-based awards	247		239		298		270
Weighted average common shares outstanding - Diluted	39,678		40,126		39,724		40,170
Earnings per common share - Basic	$	0.31	$	0.79	$	0.38	$	1.43
Earnings per common share - Diluted	$	0.31	$	0.79	$	0.38	$	1.42

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Segment Information Depreciation and Amortization, by Segment (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Property, Plant and Equipment [Line Items]
Depreciation and amortization	$ 24,274	$ 27,044	$ 49,031	$ 54,271
Energy Operating Segment [Member]
Property, Plant and Equipment [Line Items]
Depreciation and amortization	18,348	20,488	36,819	41,144
Water Operating Segment [Member]
Property, Plant and Equipment [Line Items]
Depreciation and amortization	5,909	6,539	12,178	13,095
Corporate Unallocated [Member]
Property, Plant and Equipment [Line Items]
Depreciation and amortization	$ 17	$ 17	$ 34	$ 32

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Earnings Per Share and Capital Structure Preferred Stock (Details) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Class of Stock [Line Items]
Preferred Stock, Shares Authorized	10,000,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Preferred Stock, No Par Value

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Stock-Based Compensation Stock Option Summary (Details) (Employee Stock Option [Member], USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended								6 Months Ended
	Jun. 30, 2013		Dec. 31, 2012		Jun. 30, 2012		Dec. 31, 2011		Jun. 30, 2013		Jun. 30, 2012
[Line Items]
Outstanding, beginning balance, Number									1,137		1,109
Outstanding, beginning balance, Weighted Average Exercise Price Per Share									$ 54.06		$ 55.97
Outstanding, beginning balance, Aggregate Intrinsic Value									$ 3,815	[1]	$ 2,323	[1]
Options granted, number	0				0				128		54
Granted, Weighted Average Exercise Price Per Share									$ 42.76		$ 48.23
Granted, Weighted Average Grant Date Fair Value									$ 15.44		$ 18.64
Exercised, Number									(32)		(28)
Exercised, Weighted Average Exercise Price Per Share									$ 23.36		$ 20.32
Exercised, Aggregate Intrinsic Value									639	[1]	576	[1]
Expired, Number									(8)		(32)
Expired, Weighted Average Exercise Price Per Share									$ 49.92		$ 69.69
Outstanding, ending balance, Number	1,225		1,137		1,103		1,109		1,225		1,103
Outstanding, ending balance, Weighted Average Exercise Price Per Share	$ 53.71		$ 54.06		$ 56.10		$ 55.97		$ 53.71		$ 56.10
Outstanding, ending balance, Weighted Average Remaining Contractual Term			4 years 9 months 21 days				4 years 6 months 3 days		4 years 11 months 26 days		4 years 3 months 25 days
Outstanding, ending balance, Aggregate Intrinsic Value	2,388	[1]	3,815	[1]	3,090	[1]	2,323	[1]	2,388	[1]	3,090	[1]
Exercisable, Number	901								901
Exercisable, Weighted Average Exercise Price Per Share	$ 57.52								$ 57.52
Exercisable, Weighted Average Remaining Contractual Term									3 years 5 months 4 days
Exercisable, Aggregate Intrinsic Value	2,186	[1]							2,186	[1]
Expected to Vest [Member]
[Line Items]
Outstanding, ending balance, Number	304								304
Outstanding, ending balance, Weighted Average Exercise Price Per Share	$ 43.17								$ 43.17
Outstanding, ending balance, Weighted Average Remaining Contractual Term									9 years 3 months 25 days
Outstanding, ending balance, Aggregate Intrinsic Value	$ 190	[1]							$ 190	[1]

[1] The aggregate intrinsic value of outstanding stock options represents amounts that would have been received by the optionees had all in- the-money options been exercised on that date. Specifically, it is the amount by which the market value of Itron’s stock exceeded the exercise price of the outstanding in-the-money options before applicable income taxes, based on our closing stock price on the last business day of the period. The aggregate intrinsic value of stock options exercised during the period is calculated based on our stock price at the date of exercise.

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Certain Balance Sheet Components Capitalized Interest Narrative (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Property, Plant and Equipment [Line Items]
Construction in progress, including purchased equipment	$ 33,529,000		$ 33,529,000		$ 26,097,000
Capitalized interest	21,000	0	64,000	0
Enterprise Resource Planning Software System [Member]
Property, Plant and Equipment [Line Items]
Construction in progress, including purchased equipment	11,100,000		11,100,000
Capitalized interest	$ 21,000		$ 64,000

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Derivative Financial Instruments Derivative and Nonderivative Hedging Instrument Fair Value Disclosure (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Liability Derivatives [Abstract]
Total liability derivatives	$ 1,590	$ 2,839
Other Current Assets [Member]
Asset Derivatives [Abstract]
Foreign exchange forward contracts	122	146
Designated as Hedging Instrument [Member] | Other Current Liabilities [Member]
Liability Derivatives [Abstract]
Interest rate swap contracts	1,348	629
Designated as Hedging Instrument [Member] | Other Long Term Obligations [Member]
Liability Derivatives [Abstract]
Interest rate swap contracts	134	2,096
Not Designated as Hedging Instrument [Member] | Other Long Term Obligations [Member]
Liability Derivatives [Abstract]
Foreign exchange forward contracts	$ 108	$ 114

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Share Repurchase Plan Additional Information (Details) (USD $) In Millions, unless otherwise specified	0 Months Ended
	Mar. 08, 2013
Stock Repurchase Program, Authorized Amount	$ 50

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Fair Values of Financial Instruments Schedule of Fair Values Of Financial Instruments by Balance Sheet Grouping (Tables)

6 Months Ended

Jun. 30, 2013

Fair Value Disclosures [Abstract]

Schedule of Fair Values Of Financial Instruments by Balance Sheet Grouping [Table Text Block]

	June 30, 2013				December 31, 2012
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
			(in thousands)
Assets
Cash and cash equivalents	$	103,662	$	103,662	$	136,411	$	136,411
Foreign exchange forwards	122		122		146		146
Liabilities
Credit facility
USD denominated term loan	$	270,000	$	268,219	$	277,500	$	275,365
Multicurrency revolving line of credit	140,000		138,930		140,000		138,751
Interest rate swaps	1,482		1,482		2,725		2,725
Foreign exchange forwards	108		108		114		114

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Segment Information Segment Information (Tables)

6 Months Ended

Jun. 30, 2013

Segment Reporting [Abstract]

Revenues Gross Profit And Operating Income By Segment [Table Text Block]

Revenues, gross profit, and operating income associated with our segments were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Revenues
Energy	$	349,623		$	444,598		$	662,301		$	882,345
Water	132,552			134,542			267,410			268,435
Total Company	$	482,175		$	579,140		$	929,711		$	1,150,780
Gross profit
Energy	$	112,673		$	148,951		$	208,227		$	283,554
Water	46,915			47,794			91,484			96,296
Total Company	$	159,588		$	196,745		$	299,711		$	379,850
Operating income (loss)
Energy	$	14,764		$	47,069		$	15,244		$	85,233
Water	15,389			11,666			27,964			27,603
Corporate unallocated	(12,177		)	(12,672		)	(22,885		)	(27,152		)
Total Company	17,976			46,063			20,323			85,684
Total other income (expense)	(3,884		)	(3,208		)	(5,978		)	(7,628		)
Income before income taxes	$	14,092		$	42,855		$	14,345		$	78,056

Revenues By Region [Table Text Block]

Revenues by region were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
United States and Canada	$	211,565	$	292,999	$	388,771	$	577,586
Europe, Middle East, and Africa	215,250		215,899		427,145		436,855
Other	55,360		70,242		113,795		136,339
Total revenues	$	482,175	$	579,140	$	929,711	$	1,150,780

Depreciation And Amortization Expense Associated With Segments [Table Text Block]

Depreciation and amortization expense associated with our segments was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Energy	$	18,348	$	20,488	$	36,819	$	41,144
Water	5,909		6,539		12,178		13,095
Corporate Unallocated	17		17		34		32
Total Company	$	24,274	$	27,044	$	49,031	$	54,271

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Defined Benefit Pension Plans (Text Block)

6 Months Ended

Jun. 30, 2013

General Discussion of Pension and Other Postretirement Benefits [Abstract]

Defined Benefit Pension Plans [Text Block]

Defined Benefit Pension Plans

We sponsor both funded and unfunded defined benefit pension plans for our international employees, primarily in Germany, France, Italy, Indonesia, and Spain, offering death and disability, retirement, and special termination benefits. The defined benefit obligation is calculated annually by using the projected unit credit method. The measurement date for the pension plans was December 31, 2012.

Our defined benefit pension plans are denominated in the functional currencies of the respective countries in which the plans are sponsored; therefore, the balances increase or decrease, with a corresponding change in OCI, due to changes in foreign currency exchange rates. Amounts recognized on the Consolidated Balance Sheets consist of:

	June 30, 2013		December 31, 2012
	(in thousands)
Assets
Plan assets in other long-term assets	$	226	$	227
Liabilities
Current portion of pension plan liability in wages and benefits payable	3,157		2,899
Long-term portion of pension plan liability	89,948		90,533
Net pension plan benefit liability	$	92,879	$	93,205

Our asset investment strategy focuses on maintaining a portfolio using primarily insurance funds, which are accounted for as investments and measured at fair value, in order to achieve our long-term investment objectives on a risk adjusted basis. Our general funding policy for these qualified pension plans is to contribute amounts sufficient to satisfy regulatory funding standards of the respective countries for each plan. We contributed $110,000 and $355,000 to the defined benefit pension plans for the six months ended June 30, 2013 and 2012, respectively. The timing of when contributions are made can vary by plan and from year to year. For 2013, assuming that actual plan asset returns are consistent with our expected rate of return, and that interest rates remain constant, we expect to contribute approximately $568,000 to our defined benefit pension plans. We contributed $440,000 to the defined benefit pension plans for the year ended December 31, 2012.

Net periodic pension benefit costs for our plans include the following components:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Service cost	$	1,011		$	676		$	1,992		$	1,414
Interest cost	786			909			1,586			1,835
Expected return on plan assets	(79		)	(82		)	(158		)	(167		)
Settlements and other	—			—			(814		)	—
Amortization of actuarial net loss	246			2			497			4
Amortization of unrecognized prior service costs	17			17			34			34
Net periodic benefit cost	$	1,981		$	1,522		$	3,137		$	3,120

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Debt Schedule of Long-Term Debt Repayments (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013		Jun. 30, 2012
Debt Instrument [Line Items]
Repayments of Long-term Debt	$ 22,500		$ 67,502
Secured Debt [Member]
Debt Instrument [Line Items]
Repayments of Long-term Debt	22,500		67,502
Term loan
Debt Instrument [Line Items]
Repayments of Long-term Debt	7,500		7,502
Multicurrency revolving line of credit (1)
Debt Instrument [Line Items]
Repayments of Long-term Debt	$ 15,000	[1]	$ 60,000

[1] We borrowed $15.0 million and $70.0 million under the multicurrency revolving line of credit during the six months ended June 30, 2013 and 2012.

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Commitments and Contingencies Extended Warranty (Details) (USD $) In Thousands, unless otherwise specified			3 Months Ended		6 Months Ended
	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2013 Extended Warranty [Member]	Jun. 30, 2012 Extended Warranty [Member]	Jun. 30, 2013 Extended Warranty [Member]	Jun. 30, 2012 Extended Warranty [Member]
Beginning balance	$ 83,700	$ 74,900	$ 32,363	$ 27,140	$ 31,960	$ 24,448
Unearned revenue for new extended warranties			1,664	2,243	2,625	5,189
Unearned revenue recognized			(525)	(331)	(995)	(631)
Effect of change in exchange rates			(107)	(41)	(195)	5
Ending balance	83,700	74,900	33,395	29,011	33,395	29,011
Less: current portion of unearned revenue for extended warranty	50,799	42,712	2,472	1,572	2,472	1,572
Long-term unearned revenue for extended warranty within Other long-term obligations			$ 30,923	$ 27,439	$ 30,923	$ 27,439

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Stock-Based Compensation Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2013

Share-based Compensation [Abstract]

Stock-Based Compensation Expense and Related Tax Benefit [Table Text Block]

For the three and six months ended June 30, stock-based compensation expense and the related tax benefit were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Stock options	$	519	$	337	$	992	$	609
Restricted stock units	4,158		4,375		8,393		7,891
Unrestricted stock awards	205		205		402		410
ESPP	144		141		335		346
Total stock-based compensation	$	5,026	$	5,058	$	10,122	$	9,256
Related tax benefit	$	1,391	$	1,375	$	2,755	$	2,564

Stock Options, Valuation Assumptions [Table Text Block]

The fair values of stock options granted were estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013(1)		2012(1)		2013		2012
Dividend yield	—	%	—	%	—	%	—	%
Expected volatility	—	%	—	%	38.1	%	42.7	%
Risk-free interest rate	—	%	—	%	1.0	%	0.9	%
Expected term (years)	—		—		5.45		5.14

⁽¹⁾  There were no employee stock options granted for the three months ended June 30, 2013 and 2012.

Employee Stock Options Activity [Table Text Block]

A summary of our stock option activity for the six months ended June 30 is as follows:

	Shares		Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value (1)		Weighted Average Grant Date Fair Value
	(in thousands)				(years)	(in thousands)
Outstanding, January 1, 2012	1,109		$	55.97	4.51	$	2,323
Granted	54		48.23					$	18.64
Exercised	(28	)	20.32			$	576
Expired	(32	)	69.69
Outstanding, June 30, 2012	1,103		$	56.10	4.32	$	3,090
Outstanding, January 1, 2013	1,137		$	54.06	4.81	$	3,815
Granted	128		42.76					$	15.44
Exercised	(32	)	23.36			$	639
Expired	(8	)	49.92
Outstanding, June 30, 2013	1,225		$	53.71	4.99	$	2,388
Exercisable, June 30, 2013	901		$	57.52	3.43	$	2,186
Expected to vest, June 30, 2013	304		$	43.17	9.32	$	190

⁽¹⁾  The aggregate intrinsic value of outstanding stock options represents amounts that would have been received by the optionees had all in- the-money options been exercised on that date. Specifically, it is the amount by which the market value of Itron’s stock exceeded the exercise price of the outstanding in-the-money options before applicable income taxes, based on our closing stock price on the last business day of the period. The aggregate intrinsic value of stock options exercised during the period is calculated based on our stock price at the date of exercise.

Restricted Stock Units, Valuation Assumptions

The weighted-average assumptions used to estimate the fair value of performance-based restricted stock units awarded and the resulting weighted average fair-value are as follows:

	Three Months Ended June 30, 2013			Six Months Ended June 30, 2013
Dividend yield	—		%	—		%
Expected volatility	39.1		%	39.1		%
Risk-free interest rate	0.3		%	0.3		%
Expected term (years)	2.53			2.53
Weighted-average fair value	$	45.70		$	45.03

Restricted Stock Units Award Activity [Table Text Block]

The following table summarizes restricted stock unit activity for the six months ended June 30:

	Number of Restricted Stock Units		Weighted Average  Grant Date Fair Value		Aggregate Intrinsic Value(1)
	(in thousands)				(in thousands)
Outstanding, January 1, 2012	625
Granted(2)	443		$	47.33
Released	(176	)			$	11,536
Forfeited	(28	)
Outstanding, June 30, 2012	864
Outstanding, January 1, 2013	774
Granted(2)	255		$	42.51
Released	(253	)			$	13,562
Forfeited	(11	)
Outstanding, June 30, 2013	765
Vested but not released, June 30, 2013	29				$	1,244
Expected to vest, June 30, 2013	672				$	28,496

⁽¹⁾  The aggregate intrinsic value is the market value of the stock, before applicable income taxes, based on the closing price on the stock release dates or at the end of the period for restricted stock units expected to vest.

⁽²⁾  Restricted stock units granted in 2012 and 2013 do not include awards under the Performance Award Agreement for the respective years, as these awards are not granted until final attainment of performance goals has been determined at the conclusion of the performance period, which had not occurred as of June 30, 2012 and 2013, respectively.

Nonrestricted Stock Awards Activity [Table Text Block]

The following table summarizes unrestricted stock award activity for the three and six months ended June 30:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Shares of unrestricted stock granted	4,518		4,526		8,847		9,979
Weighted average grant date fair value per share	$	45.37	$	45.26	$	45.40	$	41.05

Employee Stock Purchase Plan (ESPP) Activity [Table Text Block]

The following table summarizes ESPP activity for the three and six months ended June 30:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Shares of stock sold to employees(1)	27,489		30,619		47,308		53,676
Weighted average fair value per ESPP award(2)	$	6.37	$	6.19	$	6.69	$	6.55

⁽¹⁾  Stock sold to employees during each fiscal quarter under the ESPP is associated with the offering period ending on the last day of the previous fiscal quarter.

⁽²⁾  Relating to awards associated with the offering period during the three and six months ended June 30.

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Earnings Per Share and Capital Structure Computation of Basic and Diluted Earnings per Share (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Net income available to common shareholders	$ 12,399	$ 31,615	$ 14,969	$ 56,968
Weighted average common shares outstanding - Basic	39,431	39,887	39,426	39,900
Dilutive effect of stock-based awards	247	239	298	270
Weighted average common shares outstanding - Diluted	39,678	40,126	39,724	40,170
Earnings per common share - Basic (in dollars per share)	$ 0.31	$ 0.79	$ 0.38	$ 1.43
Earnings per common share - Diluted (in dollars per share)	$ 0.31	$ 0.79	$ 0.38	$ 1.42

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Segment Information Revenues By Region (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Revenues from External Customers [Line Items]
Revenue, Net	$ 482,175	$ 579,140	$ 929,711	$ 1,150,780
United States and Canada [Member]
Revenues from External Customers [Line Items]
Revenue, Net	211,565	292,999	388,771	577,586
EMEA [Member]
Revenues from External Customers [Line Items]
Revenue, Net	215,250	215,899	427,145	436,855
Other Countries [Member]
Revenues from External Customers [Line Items]
Revenue, Net	$ 55,360	$ 70,242	$ 113,795	$ 136,339

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Commitments and Contingencies (Text Block)

6 Months Ended

Jun. 30, 2013

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies [Text Block]

Commitments and Contingencies

Guarantees and Indemnifications

We are often required to obtain standby letters of credit (LOCs) or bonds in support of our obligations for customer contracts. These standby LOCs or bonds typically provide a guarantee to the customer for future performance, which usually covers the installation phase of a contract and may, on occasion, cover the operations and maintenance phase of outsourcing contracts.

Our available lines of credit, outstanding standby LOCs, and bonds are as follows:

	June 30, 2013			December 31, 2012
	(in thousands)
Credit facilities(1)
Multicurrency revolving line of credit	$	660,000		$	660,000
Long-term borrowings	(140,000		)	(140,000		)
Standby LOCs issued and outstanding	(47,037		)	(54,328		)
Net available for additional borrowings and LOCs	$	472,963		$	465,672
Unsecured multicurrency revolving lines of credit with various financial institutions
Multicurrency revolving lines of credit	$	97,456		$	67,308
Standby LOCs issued and outstanding	(29,581		)	(29,906		)
Short-term borrowings(2)	(2,731		)	(851		)
Net available for additional borrowings and LOCs	$	65,144		$	36,551
Unsecured surety bonds in force	$	136,934		$	164,820

⁽¹⁾  See Note 6 for details regarding our secured credit facilities.

⁽²⁾  Short-term borrowings are included in "Other current liabilities" on the Consolidated Balance Sheets.

In the event any such standby LOC or bond is called, we would be obligated to reimburse the issuer of the standby LOC or bond; however, we do not believe that any outstanding LOC or bond will be called.

We generally provide an indemnification related to the infringement of any patent, copyright, trademark, or other intellectual property right on software or equipment within our sales contracts, which indemnifies the customer from and pays the resulting costs, damages, and attorney’s fees awarded against a customer with respect to such a claim provided that (a) the customer promptly notifies us in writing of the claim and (b) we have the sole control of the defense and all related settlement negotiations. We may also provide an indemnification to our customers for third party claims resulting from damages caused by the negligence or willful misconduct of our employees/agents in connection with the performance of certain contracts. The terms of our indemnifications generally do not limit the maximum potential payments. It is not possible to predict the maximum potential amount of future payments under these or similar agreements.

Legal Matters

We are subject to various legal proceedings and claims of which the outcomes are subject to significant uncertainty. Our policy is to assess the likelihood of any adverse judgments or outcomes related to legal matters, as well as ranges of probable losses. A determination of the amount of the liability required, if any, for these contingencies is made after an analysis of each known issue. A liability is recorded and charged to operating expense when we determine that a loss is probable and the amount can be reasonably estimated. Additionally, we disclose contingencies for which a material loss is reasonably possible, but not probable. Liabilities recorded for legal contingencies at June 30, 2013 were not material to our financial condition or results of operations.

In 2010 and 2011, Transdata Incorporated (Transdata) filed lawsuits against four of our customers, CenterPoint Energy (CenterPoint), TriCounty Electric Cooperative, Inc. (Tri-County), San Diego Gas & Electric Company (San Diego), and Texas-New Mexico Power Company (TNMP), as well as several other utilities, alleging infringement of three patents owned by Transdata related to the use of an antenna in a meter. Pursuant to our contractual obligations with our customers, we agreed, subject to certain exceptions, to indemnify and defend them in these lawsuits. The complaints seek unspecified damages as well as injunctive relief. CenterPoint, Tri-County, San Diego, and TNMP have denied all of the substantive allegations and filed counterclaims seeking a declaratory judgment that the patents are invalid and not infringed. In December 2011, the Judicial Panel on Multi-District Litigation consolidated all of these cases in the Western District of Oklahoma for pretrial proceedings. On April 17, 2011, the Oklahoma court stayed the litigation pending the resolution of re-examination proceedings in the United States Patent and Trademark Office (U.S. PTO). The U.S. PTO has issued re-examination certificates confirming the patentability of the original claims and allowing certain new claims added by TransData. The parties conducted a claim construction hearing on February 5, 2013 on one claim term -- "electric meter circuitry." After initially adopting defendants' proposed construction of the term, the Court granted TransData's motion for reconsideration by order of June 25, 2013, and has adopted TransData's proposed construction. A claim construction hearing on the remaining terms is scheduled for late September 2013. Most of the remaining deadlines are based on the date of the Court's decision relating to those remaining terms. No trials are scheduled. We do not believe this matter will have a material adverse effect on our business or financial condition, although an unfavorable outcome could have a material adverse effect on our results of operations for the period in which such a loss is recognized.

In June 2011, a lawsuit was filed in the United States District Court for the Eastern District of Texas alleging infringement of three patents owned by EON Corp. IP Holdings, LLC (EON), related to two-way communication networks, network components, and related software platforms. The complaint seeks unspecified damages as well as injunctive relief. The Court has construed key terms of the three patents and has granted requests to file motions for summary judgment. We do not believe this matter will have a material adverse effect on our business or financial condition.

In a series of cases, approximately 270 former employees of Itron Sistemas e Technologia Ltda. (Itron Brazil), the majority of whose employment contracts were terminated in 2011, have sued Itron Brazil seeking payment of overtime and salary differential and alleging that the assumption of the employment relationship by Itron Brazil constituted illegal outsourcing under Brazilian law. In 2008, Itron Brazil entered into an agreement to provide installation and maintenance services to one of its customers and, to perform such services, hired over 800 employees of the previous provider of such services. In 2011, Itron Brazil determined to terminate the contract with its customer, which led to the termination of approximately 870 employees. Under applicable statutes of limitation, most additional employee claims must be brought prior to October 31, 2013. Itron Brazil intends to vigorously defend these cases but the ultimate outcome of the cases, and the amount of any liability, cannot be determined at this time.

The Company and its subsidiaries are parties to various employment-related proceedings in jurisdictions where it does business. None of the proceedings are individually material to the Company, and management believes that the Company has made adequate provision such that the ultimate disposition of the proceedings will not materially affect the Company's business or financial condition.

Warranty

A summary of the warranty accrual account activity is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Beginning balance	$	50,754		$	77,251		$	53,605		$	79,536
New product warranties	1,961			3,507			2,822			5,636
Other changes/adjustments to warranties	3,611			(3,770		)	5,638			2,061
Claims activity	(5,289		)	(8,255		)	(10,388		)	(19,575		)
Effect of change in exchange rates	(405		)	(2,365		)	(1,045		)	(1,290		)
Ending balance	50,632			66,368			50,632			66,368
Less: current portion of warranty	24,709			42,861			24,709			42,861
Long-term warranty	$	25,923		$	23,507		$	25,923		$	23,507

Total warranty expense is classified within cost of revenues and consists of new product warranties issued, costs related to extended warranty contracts, and other changes and adjustments to warranties. Warranty expense for the three and six months ended June 30 is as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
	(in thousands)
Total warranty expense	$	5,572	$	(263	)	$	8,460	$	7,697

Warranty expense increased during the three and six months ended June 30, 2013, compared with the same periods in 2012. Warranty expense during the three and six months ended June 30, 2012 reflected a $4.3 million adjustment, which reduced a warranty accrual, originally recorded in 2011, as a result of lower than estimated replacements.

Unearned Revenue Related to Extended Warranty

A summary of changes to unearned revenue for extended warranty contracts is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Beginning balance	$	32,363		$	27,140		$	31,960		$	24,448
Unearned revenue for new extended warranties	1,664			2,243			2,625			5,189
Unearned revenue recognized	(525		)	(331		)	(995		)	(631		)
Effect of change in exchange rates	(107		)	(41		)	(195		)	5
Ending balance	33,395			29,011			33,395			29,011
Less: current portion of unearned revenue for extended warranty	2,472			1,572			2,472			1,572
Long-term unearned revenue for extended warranty within Other long-term obligations	$	30,923		$	27,439		$	30,923		$	27,439

Health Benefits

We are self insured for a substantial portion of the cost of our U.S. employee group health insurance. We purchase insurance from a third party, which provides individual and aggregate stop-loss protection for these costs. Each reporting period, we expense the costs of our health insurance plan including paid claims, the change in the estimate of incurred but not reported (IBNR) claims, taxes, and administrative fees (collectively, the plan costs).

Plan costs are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Plan costs	$	5,662	$	7,217	$	10,500	$	12,878

The IBNR accrual, which is included in wages and benefits payable, is as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
IBNR accrual	$	2,345	$	2,552

Our IBNR accrual and expenses may fluctuate due to the number of plan participants, claims activity, and deductible limits. For our employees located outside of the United States, health benefits are provided primarily through governmental social plans, which are funded through employee and employer tax withholdings.

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Commitments and Contingencies Incurred But Not Reported Health Benefit Cost Accrual (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
IBNR Accrual	$ 2,345	$ 2,552

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Defined Benefit Pension Plans Defined Benefit Pension Plan Additional Information (Details) (USD $)	6 Months Ended		12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Contributions by Employer	$ 110,000	$ 355,000	$ 440,000
Estimated Future Employer Contributions in Current Fiscal Year	$ 568,000

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Derivative Financial Instruments (Text Block)

6 Months Ended

Jun. 30, 2013

General Discussion of Derivative Instruments and Hedging Activities [Abstract]

Derivative Financial Instruments [Text Block]

Derivative Financial Instruments

As part of our risk management strategy, we use derivative instruments to hedge certain foreign currency and interest rate exposures. Refer to Note 1, Note 13, and Note 14 for additional disclosures on our derivative instruments.

The fair values of our derivative instruments are determined using the income approach and significant other observable inputs (also known as “Level 2”). We have used observable market inputs based on the type of derivative and the nature of the underlying instrument. The key inputs include interest rate yield curves (swap rates and futures) and foreign exchange spot and forward rates, all of which are available in an active market. We have utilized the mid-market pricing convention for these inputs. We include, as a discount to the derivative asset, the effect of our counterparty credit risk based on current published credit default swap rates when the net fair value of our derivative instruments is in a net asset position. We consider our own nonperformance risk when the net fair value of our derivative instruments is in a net liability position by discounting our derivative liabilities to reflect the potential credit risk to our counterparty through applying a current market indicative credit spread to all cash flows.

The fair values of our derivative instruments at June 30, 2013 and December 31, 2012 were as follows:

		Fair Value
	Balance Sheet Location	June 30, 2013		December 31, 2012
		(in thousands)
Asset Derivatives
Derivatives not designated as hedging instruments under ASC 815-20
Foreign exchange forward contracts	Other current assets	$	122	$	146
Liability Derivatives
Derivatives designated as hedging instruments under ASC 815-20
Interest rate swap contracts	Other current liabilities	$	1,348	$	629
Interest rate swap contracts	Other long-term obligations	134		2,096
Derivatives not designated as hedging instruments under ASC 815-20
Foreign exchange forward contracts	Other current liabilities	108		114
Total liability derivatives		$	1,590	$	2,839

A summary of the potential effect of netting arrangements on our financial position related to the offsetting of our recognized derivative assets and liabilities under master netting arrangements or similar agreements is as follows:

Offsetting of Derivative Assets
			Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Assets Presented in the Consolidated Balance Sheets		Derivative Financial Instruments			Cash Collateral Received		Net Amount
	(in thousands)
June 30, 2013	$	122	$	(122	)	$	—	$	—
December 31, 2012	$	146	$	(135	)	$	—	$	11

Offsetting of Derivative Liabilities
			Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Liabilities Presented in the Consolidated Balance Sheets		Derivative Financial Instruments			Cash Collateral Pledged		Net Amount
	(in thousands)
June 30, 2013	$	1,590	$	(122	)	$	—	$	1,468
December 31, 2012	$	2,839	$	(135	)	$	—	$	2,704

Our derivative assets and liabilities consist of foreign exchange forward and interest rate swap contracts with nine counterparties at June 30, 2013 and eight counterparties at December 31, 2012. None of our counterparties were individually significant at June 30, 2013 or December 31, 2012. Our derivative contracts with each of these counterparties exist under agreements that provide for the net settlement of all contracts through a single payment in a single currency in the event of default. We have no pledges of cash collateral against our obligations nor have we received pledges of cash collateral from our counterparties under the associated derivative contracts.

OCI during the reporting periods for our derivative hedging instruments, net of tax, was as follows:

	2013			2012
	(in thousands)
Net unrealized loss on hedging instruments at January 1,	$	(16,069	)	$	(14,380	)
Unrealized gain (loss) on derivative instruments	772			(849		)
Net unrealized loss on hedging instruments at June 30,	$	(15,297	)	$	(15,229	)

Included in the net unrealized loss on hedging instruments at June 30, 2013 and 2012 is a loss of $14.4 million, net of tax, related to our nonderivative net investment hedge, which terminated in 2011. This loss on our net investment hedge will remain in accumulated OCI until such time when earnings are impacted by a sale or liquidation of the associated foreign operation.

Cash Flow Hedges

As a result of our floating rate debt, we are exposed to variability in our cash flows from changes in the applicable interest rate index. We enter into swaps to achieve a fixed rate of interest on the hedged portion of debt in order to increase our ability to forecast interest expense. The objective of these swaps is to reduce the variability of cash flows from increases in the LIBOR base borrowing rates on our floating rate credit facility. The swaps do not protect us from changes to the applicable margin under our credit facility.

In May 2012, we entered into six forward starting pay-fixed receive one-month LIBOR interest rate swaps. The interest rate swaps convert $200 million of our LIBOR based debt from a floating LIBOR interest rate to a fixed interest rate of 1.00% (excluding the applicable margin on the debt) and are effective July 31, 2013 to August 8, 2016. These cash flow hedges are expected to be highly effective in achieving offsetting cash flows attributable to the hedged risk through the term of the hedge. Consequently, effective changes in the fair value of the interest rate swaps are recorded as a component of OCI and will be recognized in earnings when the hedged item affects earnings. The amounts paid or received on the hedges will be recognized as adjustments to interest expense. The amount of net losses expected to be reclassified into earnings in the next 12 months is $1.3 million. At June 30, 2013, our LIBOR based debt balance was $410.0 million.

We will continue to monitor and assess our interest rate risk and may institute additional interest rate swaps or other derivative instruments to manage such risk in the future.

The before-tax effect of our cash flow derivative instruments on the Consolidated Balance Sheets and the Consolidated Statements of Operations for the three and six months ended June 30 were as follows:

Derivatives in ASC 815-20 Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in OCI on Derivative  (Effective Portion)					Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)					Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
						Location	Amount				Location	Amount
	2013		2012				2013		2012			2013		2012
	(in thousands)						(in thousands)					(in thousands)
Three Months Ended June 30,
Interest rate swap contracts	$	1,336	$	(1,365	)	Interest expense	$	—	$	—	Interest expense	$	—	$	—
Six Months Ended June 30,
Interest rate swap contracts	$	1,244	$	(1,365	)	Interest expense	$	—	$	—	Interest Expense	$	—	$	—

Derivatives Not Designated as Hedging Relationships

We are also exposed to foreign exchange risk when we enter into non-functional currency transactions, both intercompany and third-party. At each period-end, non-functional currency monetary assets and liabilities are revalued with the change recorded to other income and expense. We enter into monthly foreign exchange forward contracts (a total of 247 contracts were entered into during the six months ended June 30, 2013), which are not designated for hedge accounting, with the intent to reduce earnings volatility associated with certain of these non-functional currency assets and liabilities. The notional amounts of the contracts ranged from $251,000 to $11.0 million, offsetting our exposures to the euro, Saudi riyal, Canadian dollar, Australian dollar, Brazilian real, South African rand, and various other currencies.

The effect of our foreign exchange forward derivative instruments on the Consolidated Statements of Operations for the three and six months ended June 30 was as follows:

Derivatives Not Designated as Hedging Instrument under ASC 815-20	Gain (Loss) Recognized on Derivatives in Other Income (Expense)
	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Foreign exchange forward contracts	$	(971	)	$	(244	)	$	(757	)	$	(421	)

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Earnings Per Share and Capital Structure (Text Block)

6 Months Ended

Jun. 30, 2013

Earnings Per Share [Abstract]

Earnings Per Share and Capital Structure [Text Block]

Earnings Per Share and Capital Structure

The following table sets forth the computation of basic and diluted earnings per share (EPS):

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands, except per share data)
Net income available to common shareholders	$	12,399	$	31,615	$	14,969	$	56,968
Weighted average common shares outstanding - Basic	39,431		39,887		39,426		39,900
Dilutive effect of stock-based awards	247		239		298		270
Weighted average common shares outstanding - Diluted	39,678		40,126		39,724		40,170
Earnings per common share - Basic	$	0.31	$	0.79	$	0.38	$	1.43
Earnings per common share - Diluted	$	0.31	$	0.79	$	0.38	$	1.42

Stock-based Awards

For stock-based awards, the dilutive effect is calculated using the treasury stock method. Under this method, the dilutive effect is computed as if the awards were exercised at the beginning of the period (or at time of issuance, if later) and assumes the related proceeds were used to repurchase common stock at the average market price during the period. Related proceeds include the amount the employee must pay upon exercise, future compensation cost associated with the stock award, and the amount of excess tax benefits, if any. Approximately 1.1 million and 1.2 million stock-based awards were excluded from the calculation of diluted EPS for each of the three and six months ended June 30, 2013, and approximately 1.4 million and 1.3 million stock-based awards were excluded from the calculation of diluted EPS for each of the three and six months ended June 30, 2012, because they were anti-dilutive. These stock-based awards could be dilutive in future periods.

Preferred Stock

We have authorized the issuance of 10 million shares of preferred stock with no par value. In the event of a liquidation, dissolution, or winding up of the affairs of the corporation, whether voluntary or involuntary, the holders of any outstanding preferred stock would be entitled to be paid a preferential amount per share to be determined by the Board of Directors prior to any payment to holders of common stock. There was no preferred stock issued or outstanding at June 30, 2013 and December 31, 2012.

Stock Repurchase Plan

On March 8, 2013, the Board authorized a twelve-month repurchase program of up to $50 million of our common stock. As of June 30, 2013, we have repurchased 384,800 shares of our common stock, totaling $16.1 million, with $33.9 million remaining under the repurchase program. Repurchases are made in the open market or in privately negotiated transactions, and in accordance with applicable securities laws. Refer to Part II, Item 2: "Unregistered Sales of Equity Securities and Use of Proceeds" for additional information related to our share repurchase program.

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Commitments and Contingencies Health Benefit Plan Costs (Details) (Health Plan Benefit Costs [Domain], USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Health Plan Benefit Costs [Domain]
Plan costs	$ 5,662	$ 7,217	$ 10,500	$ 12,878

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Certain Balance Sheet Components Property, Plant, and Equipment, Net (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Property, Plant and Equipment [Line Items]
Machinery and equipment	$ 290,500	$ 287,791
Computers and software	88,186	84,980
Buildings, furniture, and improvements	143,420	146,191
Land	24,663	25,318
Construction in progress, including purchased equipment	33,529	26,097
Total cost	580,298	570,377
Accumulated depreciation	(330,926)	(315,165)
Property, plant, and equipment, net	$ 249,372	$ 255,212

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Certain Balance Sheet Components Accounts Receivable, Net (Parenthetical) (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011
Accounts Receivable, Net (Line Items]
Allowance	$ 6,948	$ 6,144	$ 7,372	$ 5,381	$ 5,983	$ 6,049

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Subsequent Event (Details) (USD $)	4 Months Ended	1 Months Ended
	Jun. 30, 2013	Aug. 01, 2013 Subsequent Event [Member]
Subsequent Event [Line Items]
Stock Repurchased and Retired During Period, Shares	384,800	174,200
Stock Repurchased and Retired During Period, Average Price Per Share		$ 42.71

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Stock-Based Compensation Stock-Based Compensation Narrative (Details) (USD $) In Millions, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Employee Stock Option [Member]
[Line Items]
Award vesting rights			Options generally become exercisable in three equal annual installments beginning one year from the date of grant
Stock options expiration period (years)			10 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross	0	0	128,000	54,000
Unrecognized compensation expense	$ 4.1		$ 4.1
Unrecognized compensation expense, Expected weighted average period for recognition (years)			2 years 3 months 18 days
Restricted Stock Units (RSUs) [Member]
[Line Items]
Unrecognized compensation expense	$ 24.2		$ 24.2
Unrecognized compensation expense, Expected weighted average period for recognition (years)			1 year 10 months 30 days
Award vesting period			3 years
Long Term Performance Restricted Stock Award [Member]
[Line Items]
Performance Condition Vesting Range, Lower Range Limit			0.00%
Performance Condition Vesting Range, Upper Range Limit			160.00%
Market Condition Multiplier, Lower Range Limit			75.00%
Market Condition Multiplier, Upper Range Limit			125.00%
Possible Total Percentage of Shares Vested, Lower Range Limit			0.00%
Possible Total Percentage of Shares Vested, Upper Range Limit			200.00%
Employee Stock [Member]
[Line Items]
Number of shares available for future grant under the Stock Incentive Plan	553,000		553,000
ESPP, maximum percentage of employee salary eligible for participation	10.00%		10.00%
ESPP, percentage discount from market price on purchase date			15.00%
Stock Incentive Plan [Member]
[Line Items]
Number of shares authorized for issuance under the share based compensation plan	3,500,000		3,500,000
Number of shares available for future grant under the Stock Incentive Plan	431,758		431,758
Share-based Compensation Arrangement by Share-based Payment Award, Description			The Stock Incentive Plan shares are subject to a fungible share provision such that, with respect to grants made after December 31, 2009, the authorized share reserve is reduced by (i) one share for every one share subject to a stock option or share appreciation right granted under the Plan and (ii) 1.7 shares for every one share of common stock that was subject to an award other than an option or stock appreciation right.

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Restructuring Restructuring (Tables)

6 Months Ended

Jun. 30, 2013

Restructuring and Related Activities [Abstract]

Schedule of Restructuring and Related Costs [Table Text Block]

The total expected restructuring costs, the costs recognized in prior periods, the restructuring costs recognized during the six months ended June 30, 2013, and the remaining expected restructuring costs as of June 30, 2013 are as follows:

	Total Expected Costs at  June 30, 2013		Costs Recognized in Prior Periods		Costs Recognized During the Six Months Ended June 30, 2013		Remaining Costs to be Recognized at June 30, 2013 (1)
	(in thousands)
Employee severance costs	$	46,850	$	44,196	$	2,654	$	—
Asset impairments	20,332		20,305		27		—
Other restructuring costs	6,963		5,246		1,717		—
Total	$	74,145	$	69,747	$	4,398	$	—
Segments:
Energy	$	53,385	$	53,190	$	195	$	—
Water	15,675		14,556		1,119		—
Corporate unallocated	5,085		2,001		3,084		—
Total	$	74,145	$	69,747	$	4,398	$	—

⁽¹⁾ There are no significant restructuring costs expected to be incurred after June 30, 2013 for these restructuring projects.

Schedule of Restructuring Reserve by Type of Cost [Table Text Block]

The following table summarizes the activity within the restructuring related balance sheet accounts during the six months ended June 30, 2013:

	Accrued Employee Severance			Asset Impairments & Net Loss on Sale or Disposal			Other Accrued Costs			Total
	(in thousands)
Beginning balance, January 1, 2013	$	14,498		$	—		$	3,216		$	17,714
Costs incurred and charged to expense	2,654			27			1,717			4,398
Cash payments	(3,155		)	—			(833		)	(3,988		)
Non-cash items	—			(27		)	—			(27		)
Effect of change in exchange rates	(447		)	—			(28		)	(475		)
Ending balance, June 30, 2013	$	13,550		$	—		$	4,072		$	17,622

Fair Value Measurements, Nonrecurring [Table Text Block]

The following table includes assets that were measured at fair value on a nonrecurring basis as of June 30, 2013 and December 31, 2012, and the related losses recognized during the period:

	Net Carrying Value		Fair Value Measurement (Level 3)		Total Loss Recognized in Period
	(in thousands)
June 30, 2013
Long-lived assets held for sale	$	3,128	$	3,128	$	—
December 31, 2012
Long-lived assets held for sale	$	3,184	$	3,184	$	2

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Segment Information Information By Segment (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Segment Reporting Information [Line Items]
Revenues	$ 482,175	$ 579,140	$ 929,711	$ 1,150,780
Gross profit	159,588	196,745	299,711	379,850
Operating Income (Loss)	17,976	46,063	20,323	85,684
Total other income (expense)	(3,884)	(3,208)	(5,978)	(7,628)
Income Before Income Taxes	14,092	42,855	14,345	78,056
Energy Operating Segment [Member]
Segment Reporting Information [Line Items]
Revenues	349,623	444,598	662,301	882,345
Gross profit	112,673	148,951	208,227	283,554
Operating Income (Loss)	14,764	47,069	15,244	85,233
Water Operating Segment [Member]
Segment Reporting Information [Line Items]
Revenues	132,552	134,542	267,410	268,435
Gross profit	46,915	47,794	91,484	96,296
Operating Income (Loss)	15,389	11,666	27,964	27,603
Corporate Unallocated [Member]
Segment Reporting Information [Line Items]
Operating Income (Loss)	$ (12,177)	$ (12,672)	$ (22,885)	$ (27,152)

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Other Comprehensive Income Accumulated Other Comprehensive Income (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning of Period			$ (34,384)
Total other comprehensive income (loss), net of tax	8,203	(53,198)	(23,545)	(24,634)
Accumulated Other Comprehensive Income (Loss), Net of Tax, End of Period	(57,929)		(57,929)
Parent [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning of Period			(34,384)	(37,160)
OCI before reclassifications			(23,914)	(24,679)
Amounts reclassified from AOCI			369	45
Total other comprehensive income (loss), net of tax			(23,545)	(24,634)
Accumulated Other Comprehensive Income (Loss), Net of Tax, End of Period	(57,929)	(61,794)	(57,929)	(61,794)
Accumulated Translation Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning of Period			(3,313)	(24,718)
OCI before reclassifications			(24,120)	(23,830)
Amounts reclassified from AOCI			0	0
Total other comprehensive income (loss), net of tax			(24,120)	(23,830)
Accumulated Other Comprehensive Income (Loss), Net of Tax, End of Period	(27,433)	(48,548)	(27,433)	(48,548)
Accumulated Other Comprehensive Income, Net Unrealized Gain (Loss) on Derivative Instruments [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning of Period			(1,689)	0
OCI before reclassifications			772	(849)
Amounts reclassified from AOCI			0	0
Total other comprehensive income (loss), net of tax			772	(849)
Accumulated Other Comprehensive Income (Loss), Net of Tax, End of Period	(917)	(849)	(917)	(849)
Accumulated Other Comprehensive Income, Net Unrealized Gain (Loss) on Nonderivative Instruments [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning of Period			(14,380)	(14,380)
OCI before reclassifications			0	0
Amounts reclassified from AOCI			0	0
Total other comprehensive income (loss), net of tax			0	0
Accumulated Other Comprehensive Income (Loss), Net of Tax, End of Period	(14,380)	(14,380)	(14,380)	(14,380)
Accumulated Defined Benefit Plans Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning of Period			(15,002)	1,938
OCI before reclassifications			(566)	0
Amounts reclassified from AOCI			369	45
Total other comprehensive income (loss), net of tax			(197)	45
Accumulated Other Comprehensive Income (Loss), Net of Tax, End of Period	$ (15,199)	$ 1,983	$ (15,199)	$ 1,983

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Stock-Based Compensation Employee Stock Purchase Plan (Details) (Employee Stock [Member], USD $)	3 Months Ended				6 Months Ended
	Jun. 30, 2013		Jun. 30, 2012		Jun. 30, 2013		Jun. 30, 2012
Employee Stock [Member]
[Line Items]
Shares of stock sold to employees(1)	27,489	[1]	30,619	[1]	47,308	[1]	53,676	[1]
Weighted average fair value per ESPP award(2)	$ 6.37	[2]	$ 6.19	[2]	$ 6.69	[2]	$ 6.55	[2]

[1] Stock sold to employees during each fiscal quarter under the ESPP is associated with the offering period ending on the last day of the previous fiscal quarter.

[2] Relating to awards associated with the offering period during the three and six months ended June 30.

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Commitments and Contingencies Commitments and Contingencies Narrative (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Total warranty expense	$ 5,572	$ (263)	$ 8,460	$ 7,697
Reduction of a Warranty Accrual Originally Recorded in 2011 Due to Lower Than Expected Replacements [Member]
Total warranty expense		$ (4,300)

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Derivative Financial Instruments Offsetting of Derivative Assets (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Offsetting Assets [Line Items]
Gross Amounts of Recognized Assets Presented in the Consolidated Balance Sheets	$ 122	$ 146
Derivative Financial Instruments Not Offset in the Consolidated Balance Sheets	(122)	(135)
Cash Collateral Received Not Offset in the Consolidated Balance Sheets	0	0
Net Amount	$ 0	$ 11

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Goodwill Schedule of Goodwill Allocated to Reporting Segments (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013
Beginning of the Period [Roll Forward]
Goodwill before impairment	$ 1,273,848
Accumulated impairment losses	(572,832)
Goodwill, net	701,016
Adjustments of previous acquisition	3,958
Effect of change in exchange rates	(8,759)
End of the Period [Roll Forward]
Goodwill before impairment	1,258,968
Accumulated impairment losses	(562,753)
Goodwill, net	696,215
Energy Operating Segment [Member]
Beginning of the Period [Roll Forward]
Goodwill before impairment	859,454
Accumulated impairment losses	(249,502)
Goodwill, net	609,952
Adjustments of previous acquisition	3,958
Effect of change in exchange rates	(7,551)
End of the Period [Roll Forward]
Goodwill before impairment	851,471
Accumulated impairment losses	(245,112)
Goodwill, net	606,359
Water Operating Segment [Member]
Beginning of the Period [Roll Forward]
Goodwill before impairment	414,394
Accumulated impairment losses	(323,330)
Goodwill, net	91,064
Adjustments of previous acquisition	0
Effect of change in exchange rates	(1,208)
End of the Period [Roll Forward]
Goodwill before impairment	407,497
Accumulated impairment losses	(317,641)
Goodwill, net	$ 89,856

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Income Taxes Income Taxes Narrative (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2013	Jun. 30, 2012
US Federal Statutory Tax Rate		35.00%	35.00%
Income Tax Reconciliation, Tax Credits, Research	$ 4.0

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Fair Values of Financial Instruments (Text Block)

6 Months Ended

Jun. 30, 2013

Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Abstract]

Fair Values of Financial Instruments [Text Block]

Fair Values of Financial Instruments

The fair values at June 30, 2013 and December 31, 2012 do not reflect subsequent changes in the economy, interest rates, and other variables that may affect the determination of fair value.

	June 30, 2013				December 31, 2012
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
			(in thousands)
Assets
Cash and cash equivalents	$	103,662	$	103,662	$	136,411	$	136,411
Foreign exchange forwards	122		122		146		146
Liabilities
Credit facility
USD denominated term loan	$	270,000	$	268,219	$	277,500	$	275,365
Multicurrency revolving line of credit	140,000		138,930		140,000		138,751
Interest rate swaps	1,482		1,482		2,725		2,725
Foreign exchange forwards	108		108		114		114

The following methods and assumptions were used in estimating fair values:

Cash and cash equivalents: Due to the liquid nature of these instruments, the carrying value approximates fair value (Level 1).

Credit facility - term loan and multicurrency revolving line of credit: The term loan and revolver are not traded publicly. The fair values, which are valued based upon a hypothetical market participant, are calculated using a discounted cash flow model with Level 2 inputs, including estimates of incremental borrowing rates for debt with similar terms, maturities, and credit profiles. Refer to Note 6 for a further discussion of our debt.

Derivatives: See Note 7 for a description of our methods and assumptions in determining the fair value of our derivatives, which were determined using Level 2 inputs.

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Income Taxes (Text Block)

6 Months Ended

Jun. 30, 2013

Income Tax Disclosure [Abstract]

Income Taxes [Text Block]

Income Taxes

Our tax provisions as a percentage of income (loss) before tax typically differ from the federal statutory rate of 35%, and may vary from period to period, due to fluctuations in the forecasted mix of earnings in domestic and international jurisdictions, new or revised tax legislation and accounting pronouncements, tax credits, state income taxes, adjustments to valuation allowances, and uncertain tax positions, among other items.

Our tax benefit for the first six months of 2013 reflects the favorable discrete tax benefit for the retroactive extension of the 2012 research and experimentation credit in the amount of $4.0 million. The American Taxpayer Relief Act of 2012 was signed into law on January 2, 2013 and extended several business tax provisions including the research and experimentation credit. Our annual estimated effective tax rate for 2013 was favorably impacted by a higher percentage of projected earnings in foreign jurisdictions with tax rates below 35%, the benefit of certain interest expense deductions, and an election under U.S. Internal Revenue Code Section 338 with respect to a foreign acquisition in 2007.  Accordingly, our 2013 annual estimated effective tax rate is lower than our 2012 annual estimated effective tax rate.

Our tax provision in 2012 was lower than the federal statutory rate of 35% due to projected earnings in tax jurisdictions with rates lower than 35%, the benefit of certain interest expense deductions, and an election under U.S. Internal Revenue Code Section 338 with respect to a foreign acquisition in 2007.

We classify interest expense and penalties related to unrecognized tax liabilities and interest income on tax overpayments as components of income tax expense. The net interest and penalties expense recognized is as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
	(in thousands)
Net interest and penalties expense	$	168	$	(22	)	$	339	$	265

Accrued interest and penalties recorded are as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Accrued interest	$	3,251	$	3,095
Accrued penalties	3,009		3,030

Unrecognized tax benefits related to uncertain tax positions and the amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate are as follows:

	June 30, 2013		December 31, 2012
	(in thousands)
Unrecognized tax benefits related to uncertain tax positions	$	26,853	$	26,433
The amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate	26,141		25,852

We believe it is reasonably possible that our unrecognized tax benefits may decrease by approximately $1.3 million within the next twelve months due to the expiration of the statute of limitations. At June 30, 2013, we are not able to reasonably estimate the timing of future cash flows relating to our uncertain tax positions.

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Derivative Financial Instruments Activity of Hedging Instruments in Accumulated OCI (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013 Accumulated Net Gain (Loss) from Derivative Instruments Designated as Hedging Instruments [Member]	Dec. 31, 2012 Accumulated Net Gain (Loss) from Derivative Instruments Designated as Hedging Instruments [Member]	Jun. 30, 2012 Accumulated Net Gain (Loss) from Derivative Instruments Designated as Hedging Instruments [Member]	Dec. 31, 2011 Accumulated Net Gain (Loss) from Derivative Instruments Designated as Hedging Instruments [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning of Period			$ (34,384)		$ (15,297)	$ (16,069)	$ (15,229)	$ (14,380)
Unrealized gain (loss) on derivative instruments	845	(849)	772	(849)
Accumulated Other Comprehensive Income (Loss), Net of Tax, End of Period	$ (57,929)		$ (57,929)		$ (15,297)	$ (16,069)	$ (15,229)	$ (14,380)

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2013

Accounting Policies [Abstract]

Basis of Consolidation [Policy Text Block]

Basis of Consolidation

We consolidate all entities in which we have a greater than 50% ownership interest or in which we exercise control over the operations. We use the equity method of accounting for entities in which we have a 50% or less investment and exercise significant influence. Entities in which we have less than a 20% investment and where we do not exercise significant influence are accounted for under the cost method. Intercompany transactions and balances are eliminated upon consolidation.

Noncontrolling Interests

In several of our consolidated international subsidiaries, we have joint venture partners, who are minority shareholders. Although these entities are not wholly-owned by Itron, we consolidate them because we have a greater than 50% ownership interest or because we exercise control over the operations. The noncontrolling interest balance is adjusted each period to reflect the allocation of net income (loss) and other comprehensive income (loss) attributable to the noncontrolling interests, as shown in our Consolidated Statements of Operations and our Consolidated Statements of Comprehensive Income (Loss). The noncontrolling interest balance in our Consolidated Balance Sheets represents the proportional share of the equity of the joint venture entities, which is attributable to the minority shareholders.

Cash and Cash Equivalents [Policy Text Block]

Cash and Cash Equivalents

We consider all highly liquid instruments with remaining maturities of three months or less at the date of acquisition to be cash equivalents.

Accounts Receivable and Allowance for Doubtful Accounts [Policy Text Block]

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded for invoices issued to customers in accordance with our contractual arrangements. Interest and late payment fees are minimal. Unbilled receivables are recorded when revenues are recognized upon product shipment or service delivery and invoicing occurs at a later date. We record an allowance for doubtful accounts representing our estimate of the probable losses in accounts receivable at the date of the balance sheet based on our historical experience of bad debts and our specific review of outstanding receivables. Accounts receivable are written-off against the allowance when we believe an account, or a portion thereof, is no longer collectible.

Inventories [Policy Text Block]

Inventories

Inventories are stated at the lower of cost or market using the first-in, first-out method. Cost includes raw materials and labor, plus applied direct and indirect costs.

Derivative Instruments [Policy Text Block]

Derivative Instruments

All derivative instruments, whether designated in hedging relationships or not, are recorded on the Consolidated Balance Sheets at fair value as either assets or liabilities. The components and fair values of our derivative instruments are determined using the fair value measurements of significant other observable inputs (Level 2), as defined by GAAP. The net fair value of our derivative instruments may switch between a net asset and a net liability depending on market circumstances at the end of the period. We include the effect of our counterparty credit risk based on current published credit default swap rates when the net fair value of our derivative instruments are in a net asset position and the effect of our own nonperformance risk when the net fair value of our derivative instruments are in a net liability position.

For any derivative designated as a fair value hedge, the changes in the fair value of the derivative and of the hedged item attributable to the hedged risk are recognized in earnings. For any derivative designated as a cash flow hedge, the effective portions of changes in the fair value of the derivative are recorded as a component of other comprehensive income (loss) (OCI) and are recognized in earnings when the hedged item affects earnings. Ineffective portions of cash flow hedges are recognized in other income (expense) in the Consolidated Statements of Operations. For a hedge of a net investment, the effective portion of any unrealized gain or loss from the foreign currency revaluation of the hedging instrument is reported in OCI as a net unrealized gain or loss on derivative instruments. Upon termination of a net investment hedge, the net derivative gain/loss will remain in accumulated OCI until such time when earnings are impacted by a sale or liquidation of the associated operations. Ineffective portions of fair value changes or the changes in fair value of derivative instruments that do not qualify for hedging activities are recognized in other income (expense) in the Consolidated Statements of Operations. We classify cash flows from our derivative programs as cash flows from operating activities in the Consolidated Statements of Cash Flows.

Derivatives are not used for trading or speculative purposes. Our derivatives are with credit-worthy multinational commercial banks, with whom we have master netting agreements; however, our derivative positions are not disclosed on a net basis. There are no credit-risk-related contingent features within our derivative instruments. Refer to Note 7 and Note 13 for further disclosures of our derivative instruments and their impact on OCI.

Property, Plant, and Equipment [Policy Text Block]

Property, Plant, and Equipment

Property, plant, and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally 30 years for buildings and improvements and three to ten years for machinery and equipment, computers and software, and furniture. Leasehold improvements are capitalized and depreciated over the term of the applicable lease, including renewable periods if reasonably assured, or over the useful lives, whichever is shorter. Construction in process represents capital expenditures incurred for assets not yet placed in service. Costs related to internally developed software and software purchased for internal uses are capitalized and are amortized over the estimated useful lives of the assets. Repair and maintenance costs are expensed as incurred. We have no major planned maintenance activities.

We review long-lived assets for impairment whenever events or circumstances indicate the carrying amount of an asset group may not be recoverable. Assets held for sale are classified within other current assets in the Consolidated Balance Sheets, are reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. Gains and losses from asset disposals and impairment losses are classified within the Consolidated Statement of Operations according to the use of the asset, except those gains and losses recognized in conjunction with our restructuring activities, which are classified as restructuring expense.

Prepaid Debt Fees [Policy Text Block]

Prepaid Debt Fees

Prepaid debt fees represent the capitalized direct costs incurred related to the issuance of debt and are recorded as noncurrent assets. These costs are amortized to interest expense over the lives of the respective borrowings, including contingent maturity or call features, using the effective interest method, or straight-line method when associated with a revolving credit facility. When debt is repaid early, the related portion of unamortized prepaid debt fees is written off and included in interest expense.

Business Combinations [Policy Text Block]

Business Combinations

On the date of acquisition, the assets acquired, liabilities assumed, and any noncontrolling interests in the acquiree are recorded at their fair values. The acquiree's results of operations are also included as of the date of acquisition in our consolidated results. Intangible assets that arise from contractual/legal rights, or are capable of being separated, as well as in-process research and development (IPR&D), are measured and recorded at fair value, and amortized over the estimated useful life. IPR&D is not amortized until such time as the associated development projects are completed or terminated. If a development project is completed, the IPR&D is reclassified as a core technology intangible asset and amortized over its estimated useful life. If the development project is terminated, the recorded value of the associated IPR&D is immediately expensed. If practicable, assets acquired and liabilities assumed arising from contingencies are measured and recorded at fair value. If not practicable, such assets and liabilities are measured and recorded when it is probable that a gain or loss has occurred and the amount can be reasonably estimated. The residual balance of the purchase price, after fair value allocations to all identified assets and liabilities, represents goodwill. Acquisition-related costs are expensed as incurred. Restructuring costs associated with an acquisition are generally expensed in periods subsequent to the acquisition date, and changes in deferred tax asset valuation allowances and acquired income tax uncertainties, including penalties and interest, after the measurement period are recognized as a component of the provision for income taxes. Our acquisitions may include contingent consideration, which require us to recognize the fair value of the estimated liability at the time of the acquisition. Subsequent changes in the estimate of the amount to be paid under the contingent consideration arrangement are recognized in the consolidated statements of operations. Cash payments for contingent or deferred consideration are classified within cash flows from investing activities within the consolidated statements of cash flows.

Goodwill and Intangible Assets [Policy Text Block]

Goodwill and Intangible Assets

Goodwill and intangible assets may result from our acquisitions. We use estimates, including estimates of useful lives of intangible assets, the amount and timing of related future cash flows, and fair values of the related operations, in determining the value assigned to goodwill and intangible assets. Our finite-lived intangible assets are amortized over their estimated useful lives based on estimated discounted cash flows. IPR&D is considered an indefinite-lived intangible asset and is not subject to amortization until the associated projects are completed or terminated. Finite-lived intangible assets are tested for impairment at the asset group level when events or changes in circumstances indicate the carrying value may not be recoverable. Indefinite-lived intangible assets are tested for impairment annually, when events or changes in circumstances indicate the asset may be impaired, or at the time when their useful lives are determined to be no longer indefinite.

Goodwill is assigned to our reporting units based on the expected benefit from the synergies arising from each business combination, determined by using certain financial metrics, including the forecasted discounted cash flows associated with each reporting unit.

We test goodwill for impairment each year as of October 1, or more frequently should a significant impairment indicator occur. As part of the impairment test, we may elect to perform an assessment of qualitative factors. If this qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit, including goodwill, is less than its carrying amount, or if we elect to bypass the qualitative assessment, we would then proceed with the two-step impairment test. The impairment test involves comparing the fair values of the reporting units to their carrying amounts. If the carrying amount of a reporting unit exceeds its fair value, a second step is required to measure the goodwill impairment loss amount. This second step determines the current fair values of all assets and liabilities of the reporting unit and then compares the implied fair value of the reporting unit's goodwill to the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in an amount equal to the excess.

Determining the fair value of a reporting unit is judgmental in nature and involves the use of significant estimates and assumptions. We forecast discounted future cash flows at the reporting unit level using risk-adjusted discount rates and estimated future revenues and operating costs, which take into consideration factors such as existing backlog, expected future orders, supplier contracts, and expectations of competitive and economic environments. We also identify similar publicly traded companies and develop a correlation, referred to as a multiple, to apply to the operating results of the reporting units. These combined fair values are then reconciled to the aggregate market value of our common stock on the date of valuation, while considering a reasonable control premium.

Contingencies [Policy Text Block]

Contingencies

A loss contingency is recorded if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. We evaluate, among other factors, the degree of probability of an unfavorable outcome and our ability to make a reasonable estimate of the amount of the ultimate loss. Loss contingencies that we determine to be reasonably possible, but not probable, are disclosed but not recorded. Changes in these factors and related estimates could materially affect our financial position and results of operations. Legal costs to defend against contingent liabilities are expensed as incurred.

Bonus and Profit Sharing [Policy Text Block]

Bonus and Profit Sharing

We have various employee bonus and profit sharing plans, which provide award amounts for the achievement of annual financial and nonfinancial targets. If management determines it is probable that the targets will be achieved, and the amounts can be reasonably estimated, a compensation accrual is recorded based on the proportional achievement of the financial and nonfinancial targets. Although we monitor and accrue expenses quarterly based on our progress toward the achievement of the annual targets, the actual results at the end of the year may require awards that are significantly greater or less than the estimates made in earlier quarters.

Warranty [Policy Text Block]

Warranty

We offer standard warranties on our hardware products and large application software products. We accrue the estimated cost of new product warranties based on historical and projected product performance trends and costs during the warranty period. Testing of new products in the development stage helps identify and correct potential warranty issues prior to manufacturing. Continuing quality control efforts during manufacturing reduce our exposure to warranty claims. When our quality control efforts fail to detect a fault in one of our products, we experience an increase in warranty claims. We track warranty claims to identify potential warranty trends. If an unusual trend is noted, an additional warranty accrual may be assessed and recorded when a failure event is probable and the cost can be reasonably estimated. When new products are introduced, our process relies on historical averages of similar products until sufficient data is available. As actual experience becomes available, it is used to modify the original estimate to ensure the expected warranty costs are within a range of likely outcomes. Management continually evaluates the sufficiency of the warranty provisions and makes adjustments when necessary. The warranty allowances may fluctuate due to higher than anticipated material, labor, and other costs we may incur to repair or replace projected product failures, and we may incur additional warranty and related expenses in the future with respect to new or established products, which could adversely affect our financial position and results of operations. The long-term warranty balance includes estimated warranty claims beyond one year. Warranty expense is classified within cost of revenues.

Restructuring and Asset Impairments [Policy Text Block]

Restructuring and Asset Impairments

We record a liability for costs associated with an exit or disposal activity at its fair value in the period in which the liability is incurred. Employee termination benefits considered postemployement benefits are accrued when the obligation is probable and estimable, such as benefits stipulated by human resource policies and practices or statutory requirements. One-time termination benefits are expensed at the date the employee is notified. If the employee must provide future service greater than 60 days, such benefits are expensed ratably over the future service period. For contract termination costs, we record a liability upon the later of when we terminate a contract in accordance with the contract terms or when we cease using the rights conveyed by the contract.

Asset impairments are determined at the asset group level. An impairment may be recorded for assets that are to be abandoned, are to be sold for less than net book value, or are held for sale in which the estimated proceeds less costs to sell are less than the net book value. We may also recognize impairment on an asset group, which is held and used, when the carrying value is not recoverable and exceeds the asset group's fair value. If an asset group is considered a business, a portion of the Company's goodwill balance is allocated to it based on relative fair value.

Defined Benefit Pension Plans [Policy Text Block]

Defined Benefit Pension Plans

We sponsor both funded and unfunded defined benefit pension plans for certain international employees. We recognize a liability for the projected benefit obligation in excess of plan assets or an asset for plan assets in excess of the projected benefit obligation. We also recognize the funded status of our defined benefit pension plans on our Consolidated Balance Sheets and recognize as a component of OCI, net of tax, the actuarial gains or losses and prior service costs or credits, if any, that arise during the period but that are not recognized as components of net periodic benefit cost.

Share Repurchase Plan [Policy Text Block]

Share Repurchase Plan

We may repurchase up to $50 million of shares of Itron common stock under a twelve-month program, which was authorized by our Board of Directors on March 8, 2013. Share repurchases are made in the open market or in privately negotiated transactions and in accordance with applicable securities laws. Under applicable Washington State law, shares repurchased are retired and not displayed separately as treasury stock on the financial statements; the value of the repurchased shares is deducted from common stock.

Revenue Recognition [Policy Text Block]

Revenue Recognition

Revenues consist primarily of hardware sales, software license fees, software implementation, project management services, installation, consulting, and post-sale maintenance support. Revenues are recognized when (1) persuasive evidence of an arrangement exists, (2) delivery has occurred or services have been rendered, (3) the sales price is fixed or determinable, and (4) collectability is reasonably assured.

The majority of our revenue arrangements involve multiple deliverables, which combine two or more of the following: hardware, meter reading system software, installation, and/or project management services. Revenue arrangements with multiple deliverables are divided into separate units of accounting if the delivered item(s) has value to the customer on a standalone basis and delivery/performance of the undelivered item(s) is probable. The total arrangement consideration is allocated among the separate units of accounting based on their relative fair values and the applicable revenue recognition criteria considered for each unit of accounting. The amount allocable to a delivered item is limited to the amount that we are entitled to collect and that is not contingent upon the delivery/performance of additional items. Revenues for each deliverable are then recognized based on the type of deliverable, such as 1) when the products are shipped, 2) services are delivered, 3) percentage-of-completion when implementation services are essential to other deliverables in the arrangement, 4) upon receipt of customer acceptance, or 5) transfer of title and risk of loss. The majority of our revenue is recognized when products are shipped to or received by a customer or when services are provided.

If, among other factors, the data collection system does not use standard internet protocols and network design services are deemed complex and extensive, hardware revenues are recognized at the time of shipment, receipt by customer, or, if applicable, upon completion of customer acceptance provisions. Revenue from network software and services is recognized using the units-of-delivery method of contract accounting, as network design services and network software are essential to the functionality of the related hardware (network). This methodology results in the deferral of costs and revenues as professional services and software implementation commence prior to deployment of hardware.

In all other instances, hardware revenues are recognized at the time of shipment, receipt by customer, or, if applicable, upon completion of customer acceptance provisions. Network software is recognized when shipped if all other revenue recognition criteria are met and services are not essential to the functionality of the software. If implementation services are essential to the functionality of the network software, software and implementation revenues are recognized using the percentage-of-completion methodology of contract accounting when project costs are reliably estimated.

We also enter into multiple deliverable software arrangements that do not include hardware. For this type of arrangement, revenue recognition is dependent upon the availability of vendor specific objective evidence (VSOE) of fair value for each of the deliverables. The lack of VSOE, or the existence of extended payment terms or other inherent risks, may affect the timing of revenue recognition for multiple deliverable software arrangements.

Certain of our revenue arrangements include an extended or noncustomary warranty provision that covers all or a portion of a customer's replacement or repair costs beyond the standard or customary warranty period. Whether or not the extended warranty is separately priced in the arrangement, a portion of the arrangement's total consideration is allocated to this extended warranty deliverable. This revenue is deferred and recognized over the extended warranty coverage period. Extended or noncustomary warranties do not represent a significant portion of our revenue.

We allocate consideration to each deliverable in an arrangement based on its relative selling price. We determine selling price using VSOE, if it exists, otherwise we use third-party evidence (TPE). We define VSOE as a median price of recent standalone transactions that are priced within a narrow range. TPE is determined based on the prices charged by our competitors for a similar deliverable when sold separately. If neither VSOE nor TPE of selling price exists for a unit of accounting, we use estimated selling price (ESP) to determine the price at which we would transact if the product or service were regularly sold by us on a standalone basis. Our determination of ESP involves a weighting of several factors based on the specific facts and circumstances of the arrangement. The factors considered include the cost to produce the deliverable, the anticipated margin on that deliverable, our ongoing pricing strategy and policies, and the characteristics of the varying markets in which the deliverable is sold.

We analyze the selling prices used in our allocation of arrangement consideration on an annual basis. Selling prices are analyzed on a more frequent basis if a significant change in our business necessitates a more timely analysis or if we experience significant variances in our selling prices.

Unearned revenue is recorded when a customer pays for products or services, but the criteria for revenue recognition have not been met as of the balance sheet date. Unearned revenues of $83.7 million and $74.9 million at June 30, 2013 and December 31, 2012 related primarily to professional services and software associated with our smart metering contracts, extended or noncustomary warranty, and prepaid post-contract support. Deferred costs are recorded for products or services for which ownership (typically defined as title and risk of loss) has transferred to the customer, but the criteria for revenue recognition have not been met as of the balance sheet date. Deferred costs were $27.7 million and $24.4 million at June 30, 2013 and December 31, 2012 and are recorded within other assets in the Consolidated Balance Sheets.

Hardware and software post-sale maintenance support fees are recognized ratably over the life of the related service contract. Shipping and handling costs and incidental expenses billed to customers are recorded as revenue, with the associated cost charged to cost of revenues. We record sales, use, and value added taxes billed to our customers on a net basis.

Product and Software Development Costs [Policy Text Block]

Product and Software Development Costs

Product and software development costs primarily include employee compensation and third party contracting fees. We do not capitalize product development costs, and we do not generally capitalize software development expenses as the costs incurred are immaterial for the relatively short period of time between technological feasibility and the completion of software development.

Stock-based Compensation [Policy Text Block]

Stock-Based Compensation

We measure and recognize compensation expense for all stock-based awards made to employees and directors, including stock options, stock sold pursuant to our Employee Stock Purchase Plan (ESPP), and the issuance of restricted stock units and unrestricted stock awards, based on estimated fair values. The fair value of stock options is estimated at the date of grant using the Black-Scholes option-pricing model, which includes assumptions for the dividend yield, expected volatility, risk-free interest rate, and expected term. For ESPP awards, the fair value is the difference between the market close price of our common stock on the date of purchase and the discounted purchase price. For performance-based restricted stock units and unrestricted stock awards with no market conditions, the fair value is the market close price of our common stock on the date of grant. For restricted stock units with market conditions, the fair value is estimated at the date of award using a Monte Carlo simulation model, which includes assumptions for dividend yield and expected volatility for our common stock and the common stock for companies within the Russell 3000 index, as well as the risk-free interest rate and expected term of the awards. We expense stock-based compensation at the date of grant for unrestricted stock awards. For awards with only a service condition, we expense stock-based compensation, adjusted for estimated forfeitures, using the straight-line method over the requisite service period for the entire award. For awards with performance and service conditions, if vesting is probable, we expense the stock-based compensation, adjusted for estimated forfeitures, on a straight-line basis over the requisite service period for each separately vesting portion of the award. For awards with a market condition, we expense the fair value over the requisite service period. Excess tax benefits are credited to common stock when the deduction reduces cash taxes payable. When we have tax deductions in excess of the compensation cost, they are classified as financing cash inflows in the Consolidated Statements of Cash Flows.

Income Tax, Policy [Policy Text Block]

Income Taxes

We compute our interim income tax provision through the use of an estimated annual effective tax rate (ETR) applied to year-to-date operating results and specific events that are discretely recognized as they occur. In determining the estimated annual ETR, we analyze various factors, including the forecasted mix of earnings in domestic and international jurisdictions, new or revised tax legislation and accounting pronouncements, tax credits, state income taxes, adjustments to valuation allowances, and uncertain tax positions, amount other items. Discrete items, including the effect of changes in tax laws, tax rates, and certain circumstances with respect to valuation allowances or other unusual or non-recurring tax adjustments, are reflected in the period in which they occur as an addition to, or reduction from, the income tax provision, rather than included in the estimated annual ETR.

Deferred tax assets and liabilities are recognized based upon anticipated future tax consequences, in each of the jurisdictions in which we operate, attributable to: (1) the differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases; and (2) operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The calculation of our tax liabilities involves applying complex tax regulations in different jurisdictions to our tax positions. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying amount of deferred tax assets if it is more likely than not that such assets will not be realized. We do not record tax liabilities on undistributed earnings of international subsidiaries that are permanently reinvested.

We utilize a two step approach to account for uncertain tax positions. A tax position is first evaluated for recognition based on its technical merits. Tax positions that have a greater than fifty percent likelihood of being realized upon ultimate settlement are then measured to determine amounts to be recognized in the financial statements. This measurement incorporates information about potential settlements with taxing authorities. A previously recognized tax position is derecognized in the first period in which the position no longer meets the more-likely-than-not recognition threshold or upon expiration of the statute of limitations. We classify interest expense and penalties related to uncertain tax positions and interest income on tax overpayments as part of income tax expense.

Foreign Exchange [Policy Text Block]

Foreign Exchange

Our consolidated financial statements are reported in U.S. dollars. Assets and liabilities of international subsidiaries with non-U.S. dollar functional currencies are translated to U.S. dollars at the exchange rates in effect on the balance sheet date, or the last business day of the period, if applicable. Revenues and expenses for each subsidiary are translated to U.S. dollars using a weighted average rate for the relevant reporting period. Translation adjustments resulting from this process are included, net of tax, in OCI. Gains and losses that arise from exchange rate fluctuations for monetary asset and liability balances that are not denominated in an entity’s functional currency are included within other income (expense), net in the Consolidated Statements of Operations. Currency gains and losses of intercompany balances deemed to be long-term in nature or designated as a hedge of the net investment in international subsidiaries are included, net of tax, in OCI.

Fair Value Measurement [Policy Text Block]

Fair Value Measurements

For assets and liabilities measured at fair value, the GAAP fair value hierarchy prioritizes the inputs used in different valuation methodologies, assigning the highest priority to unadjusted quoted prices for identical assets and liabilities in actively traded markets (Level 1) and the lowest priority to unobservable inputs (Level 3). Level 2 inputs consist of quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in non-active markets; and model-derived valuations in which significant inputs are corroborated by observable market data either directly or indirectly through correlation or other means. Inputs may include yield curves, volatility, credit risks, and default rates.

Use of Estimates [Policy Text Block]

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Due to various factors affecting future costs and operations, actual results could differ materially from these estimates.

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

New Accounting Pronouncements

The Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2013.11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists" on July 18, 2013. The ASU concludes an unrecognized tax benefit should be presented as a reduction of a deferred tax asset when settlement in this manner is available under the law. We will adopt this amendment as of January 2014. The result of adoption may be to reclassify certain long term liabilities to long term deferred tax assets, and the adoption will not result in a change to the tax provision. Management does not believe that the impact on the balance sheet will be significant.

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Segment Information (Text Block)

6 Months Ended

Jun. 30, 2013

Segment Reporting [Abstract]

Segment Information [Text Block]

Segment Information

We operate under the Itron brand worldwide and manage and report under two operating segments, Energy and Water. The Energy operating segment includes our global electricity and gas businesses, while the Water operating segment includes our global water and heat businesses.

On March 27, 2013, we separated the management of our Energy operating segment into Electricity and Gas to allow each business line to develop its own go-to-market strategy, prioritize its marketing and product development requirements, and focus on its strategic investments. As a result, our sales, marketing, and delivery function are managed under three business lines - Electricity, Gas, and Water. At the same time, product development and operations were centralized and are managed on a global basis. Although most management positions of the new business lines have been identified, the transition to the new organizational structure is ongoing, and we are continuing to assess the implications to our operating segments and our operational and financial reporting systems.

We have three measures of segment performance: revenue, gross profit (margin), and operating income (margin). Our operating segments have distinct products, and therefore intersegment revenues are minimal. Corporate operating expenses, interest income, interest expense, other income (expense), and income tax provision (benefit) are not allocated to the segments, nor included in the measure of segment profit or loss. In addition, we allocate only certain production assets and intangible assets to our operating segments. We do not manage the performance of the segments on a balance sheet basis.

Segment Products

Energy

Standard electricity (electromechanical and electronic) and gas meters; advanced electricity and gas meters and communication modules; smart electricity meters; smart electricity and gas communication modules; prepayment systems, including smart key, keypad, and smart card communication technologies; advanced systems including handheld, mobile, and fixed network collection technologies; smart network technologies; meter data management software; knowledge application solutions; and professional services including implementation, installation, consulting, and analysis.

Water

Standard water and heat meters; advanced and smart water meters and communication modules; advanced systems including handheld, mobile, and fixed network collection technologies; meter data management software; knowledge application solutions; and professional services including implementation, installation, consulting, analysis, and system management.

Revenues, gross profit, and operating income associated with our segments were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Revenues
Energy	$	349,623		$	444,598		$	662,301		$	882,345
Water	132,552			134,542			267,410			268,435
Total Company	$	482,175		$	579,140		$	929,711		$	1,150,780
Gross profit
Energy	$	112,673		$	148,951		$	208,227		$	283,554
Water	46,915			47,794			91,484			96,296
Total Company	$	159,588		$	196,745		$	299,711		$	379,850
Operating income (loss)
Energy	$	14,764		$	47,069		$	15,244		$	85,233
Water	15,389			11,666			27,964			27,603
Corporate unallocated	(12,177		)	(12,672		)	(22,885		)	(27,152		)
Total Company	17,976			46,063			20,323			85,684
Total other income (expense)	(3,884		)	(3,208		)	(5,978		)	(7,628		)
Income before income taxes	$	14,092		$	42,855		$	14,345		$	78,056

For the three and six months ended June 30, 2013, no single customer represented more than 10% of the total Company, the Energy operating segment, or the Water operating segment revenues.

For the three and six months ended June 30, 2012, one customer from the Energy operating segment accounted for 11% of the total Company revenues. During the same periods, one customer accounted for 15% of the Energy operating segment revenues, and no single customer accounted for more than 10% of the Water operating segment revenues.

Revenues by region were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
United States and Canada	$	211,565	$	292,999	$	388,771	$	577,586
Europe, Middle East, and Africa	215,250		215,899		427,145		436,855
Other	55,360		70,242		113,795		136,339
Total revenues	$	482,175	$	579,140	$	929,711	$	1,150,780

Depreciation and amortization expense associated with our segments was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Energy	$	18,348	$	20,488	$	36,819	$	41,144
Water	5,909		6,539		12,178		13,095
Corporate Unallocated	17		17		34		32
Total Company	$	24,274	$	27,044	$	49,031	$	54,271

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Document and Entity Information Document	6 Months Ended
	Jun. 30, 2013	Jul. 31, 2013
Entity Information [Line Items]
Entity Registrant Name	ITRON INC /WA/
Entity Central Index Key	0000780571
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2
Amendment Flag	false
Trading Symbol	ITRI
Entity Common Stock, Shares Outstanding		39,111,850
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes

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Income Taxes Income Tax Contingencies (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Income Tax Contingency [Line Items]
Net interest and penalties expense	$ 168,000	$ (22,000)	$ 339,000	$ 265,000
Accrued interest	3,251,000		3,251,000		3,095,000
Accrued penalties	3,009,000		3,009,000		3,030,000
Unrecognized tax benefits related to uncertain tax positions	26,853,000		26,853,000		26,433,000
The amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate	26,141,000		26,141,000		25,852,000
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Estimated Change, Next Twelve Months	$ (1,300,000)		$ (1,300,000)

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Subsequent Event

6 Months Ended

Jun. 30, 2013

Subsequent Events [Abstract]

Subsequent Event [Text Block]

Subsequent Event

Stock Repurchases

Subsequent to June 30, 2013, we repurchased 174,200 shares of our common stock under the stock repurchase program authorized by the Board of Directors on March 8, 2013. The average price paid per share was $42.71.

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Debt Schedule of Debt (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Debt Instrument [Line Items]
Current portion of debt	$ 22,500	$ 18,750
Long-term debt	387,500	398,750
Secured Debt [Member]
Debt Instrument [Line Items]
Total debt	410,000	417,500
Current portion of debt	22,500	18,750
Long-term debt	387,500	398,750
USD Denominated Term Loan
Debt Instrument [Line Items]
USD denominated term loan	270,000	277,500
Multicurrency revolving line of credit (1)
Debt Instrument [Line Items]
Multicurrency revolving line of credit	$ 140,000	$ 140,000

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Goodwill Goodwill Narrative (Details) (USD $)							1 Months Ended
	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2013 Customer contracts and relationships [Member]	Dec. 31, 2012 Customer contracts and relationships [Member]	May 01, 2012 Customer Relationship Associated with Error Adjustment - Balance Prior to Correction of Error [Member]	Jun. 30, 2013 Customer Relationship Associated with Error Adjustment - Balance Subsequent to Correction of Error [Member]	May 31, 2013 Forward Loss Recognized Resulting from Inclusion of Certain Internal Costs not Originally Reflected [Member]
Goodwill [Line Items]
Loss on Contracts							$ 2,400,000
Finite-Lived Intangible Assets, Gross	$ 784,146,000	$ 783,140,000	$ 281,644,000	$ 292,252,000	$ 1,500,000	$ 0

XML

Commitments and Contingencies Available Lines of Credit, Outstanding Standby Letter of Credits, and Bonds (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013		Dec. 31, 2012
Line of Credit Facility [Line Items]
Multicurrency revolving line of credit	$ 660,000
Credit Facility [Member]
Line of Credit Facility [Line Items]
Multicurrency revolving line of credit	660,000	[1]	660,000	[1]
Long-term borrowings	(140,000)	[1]	(140,000)	[1]
Standby LOCs issued and outstanding	(47,037)	[1]	(54,328)	[1]
Net available for additional borrowings and LOCs	472,963	[1]	465,672	[1]
Unsecured Multicurrency Revolving Lines of Credit [Member]
Line of Credit Facility [Line Items]
Multicurrency revolving line of credit	97,456		67,308
Standby LOCs issued and outstanding	(29,581)		(29,906)
Net available for additional borrowings and LOCs	65,144		36,551
Short-term borrowings(2)	(2,731)	[2]	(851)	[2]
Surety Bond [Member]
Line of Credit Facility [Line Items]
Unsecured surety bonds in force	$ 136,934		$ 164,820

[1] See Note 6 for details regarding our secured credit facilities.

[2] Short-term borrowings are included in "Other current liabilities" on the Consolidated Balance Sheets.