BALANCE SHEET COMPONENTS

The following tables provide details of selected balance sheet components (in thousands):



	June 29, 2018			December 31, 2017
Accounts receivable, net:
Accounts receivable	$	86,253		$	74,475
Less: allowances for doubtful accounts and sales returns	(3,618		)	(4,631		)
Total	$	82,635		$	69,844



	June 29, 2018		December 31, 2017
Prepaid expenses and other current assets:
Deferred cost of revenue	$	7,688	$	4,440
Prepaid maintenance, royalty, rent, property taxes and value added tax	3,753		3,867
Contract assets⁽¹⁾	2,704		—
Capitalized commission	1,293		—
Restricted cash⁽²⁾	274		530
French R&D tax credits receivable⁽³⁾	103		6,609
Other	3,562		3,485
Total	$	19,377	$	18,931

(1) Contract assets reflect the satisfied performance obligations for which the Company does not yet have an unconditional right to consideration.

(2) Amounts represent cash collateral security for certain bank guarantees. These restricted funds are invested in bank deposits and cannot be withdrawn from the Company’s accounts without the prior written consent of the applicable secured party.

(3) The Company’s TVN subsidiary in France (the “TVN French Subsidiary”) participates in the French Crédit d’Impôt Recherche program (the “R&D tax credits”) which allows companies to monetize eligible research expenses. The R&D tax credits can be used to offset against income tax payable to the French government in each of the four years after being incurred, or if not utilized, are recoverable in cash. The amount of R&D tax credits recoverable are subject to audit by the French government. The R&D tax credits receivable at June 29, 2018 were approximately $24.0 million and are expected to be recoverable from 2018 through 2022 with $0.1 million reported as a component of “Prepaid expenses and other current assets” and $23.9 million reported as a component of “Other long-term assets” on the Company’s Condensed Consolidated Balance Sheets.



	June 29, 2018		December 31, 2017
Inventories:
Raw materials	$	1,973	$	2,881
Work-in-process	755		933
Finished goods	8,871		10,130
Service-related spares	11,395		12,032
Total	$	22,994	$	25,976



	June 29, 2018			December 31, 2017
Property and equipment, net:
Machinery and equipment	$	88,129		$	87,121
Capitalized software	35,527			35,139
Leasehold improvements	14,978			15,051
Furniture and fixtures	6,499			6,534
Property and equipment, gross	145,133			143,845
Less: accumulated depreciation and amortization	(119,502		)	(114,580		)
Total	$	25,631		$	29,265



	June 29, 2018		December 31, 2017
Other long-term assets:
R&D tax credits receivable	$	23,940	$	22,322
Deferred tax assets	9,563		10,462
Equity investment	3,771		3,593
Others⁽¹⁾	5,589		6,536
Total	$	42,863	$	42,913

(1) As of December 31, 2017, the Company had approximately $1.2 million of restricted cash for the bank guarantee associated with the TVN French Subsidiary’s office building lease. The restriction was subsequently released and accordingly, the amount was reclassified to “Cash and cash equivalents” in the six months ended June 29, 2018.



	June 29, 2018		December 31, 2017
Accrued and other current liabilities:
Accrued employee compensation and related expenses	$	15,750	$	16,414
Customer deposits	4,888		5,020
Accrued warranty	4,647		4,381
Contingent inventory reserves	3,700		3,806
Accrued royalty payments	2,583		2,195
Accrued TVN VDP, current⁽¹⁾	2,446		3,186
Accrued Avid litigation settlement, current	1,500		—
Others	15,707		13,703
Total	$	51,221	$	48,705

(1) See Note 8, “Restructuring and related charges-TVN VDP,” for additional information on the Company’s TVN VDP liabilities.