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Revenue (Notes)
6 Months Ended
Jun. 30, 2018
Revenue [Abstract]  
Revenue from Contract with Customer [Text Block]
REVENUE
Adoption of ASC 606, "Revenue from Contract with Customers"
Advanced Energy adopted ASC 606 using the modified retrospective method by recognizing the cumulative effect of the adoption of ASC 606, for all contracts with customers, to the opening balance of equity at January 1, 2018. Therefore, our comparative financial information for the three and six months ended June 30, 2017 has not been adjusted and continues to be reported under ASC Topic 605. The cumulative effect adjustment was based on the timing difference of revenue recognition between ASC Topic 605 and ASC 606 related to our inventory stocking agreements. Under ASC 606, revenue related to our inventory stocking agreements are recognized when inventory is shipped to our customers. Under ASC Topic 605, revenue was recognized when the inventory was consumed by our customers. The tables below show the quantitative impact of ASC 606 on our consolidated financial statements.
 
 
June 30, 2018
 
 
 
 
 
 
Balances without
 
 
 
 
 
 
adoption of
 
 
As Reported
 
Adjustments
 
ASC 606
Accounts and other receivable, net
 
$
106,302

 
$
(13,889
)
 
$
92,413

Inventories
 
109,834

 
5,604

 
115,438

Total current assets
 
670,813

 
(8,285
)
 
662,528

TOTAL ASSETS
 
835,058

 
(8,285
)
 
826,773

 
 
 
 
 
 
 
Income taxes payable
 
14,898

 
(807
)
 
14,091

Total current liabilities
 
132,329

 
(807
)
 
131,522

Deferred income tax liabilities
 
6,527

 
(1,143
)
 
5,384

Total liabilities
 
239,542

 
(1,950
)
 
237,592

 
 
 
 
 
 
 
Retained earnings
 
445,771

 
(6,335
)
 
439,436

Advanced Energy stockholders’ equity
 
595,010

 
(6,335
)
 
588,675

Total stockholders’ equity
 
595,516

 
(6,335
)
 
589,181

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
 
835,058

 
(8,285
)
 
826,773


 
 
Three Months Ended June 30, 2018
 
 
 
 
 
 
Balances without
 
 
 
 
 
 
adoption of
 
 
As Reported
 
Adjustments
 
ASC 606
Product sales
 
$
169,235

 
$
(4,179
)
 
$
165,056

Total sales
 
196,032

 
(4,179
)
 
191,853

Product cost of sales
 
80,953

 
(1,518
)
 
79,435

Total cost of sales
 
94,797

 
(1,518
)
 
93,279

Gross profit
 
101,235

 
(2,661
)
 
98,574

Operating income
 
56,018

 
(2,661
)
 
53,357

Income from continuing operations, before income taxes
 
55,533

 
(2,661
)
 
52,872

Provision for income taxes
 
9,133

 
(577
)
 
8,556

Income from continuing operations
 
46,400

 
(2,084
)
 
44,316

Net income
 
46,405

 
(2,084
)
 
44,321

Net income attributable to Advanced Energy Industries, Inc.
 
46,361

 
(2,084
)
 
44,277


 
 
Six Months Ended June 30, 2018
 
 
 
 
 
 
Balances without
 
 
 
 
 
 
adoption of
 
 
As Reported
 
Adjustments
 
ASC 606
Product sales
 
$
340,444

 
$
(5,639
)
 
$
334,805

Total sales
 
391,649

 
(5,639
)
 
386,010

Product cost of sales
 
160,759

 
(2,044
)
 
158,715

Total cost of sales
 
186,769

 
(2,044
)
 
184,725

Gross profit
 
204,880

 
(3,595
)
 
201,285

Operating income
 
112,121

 
(3,595
)
 
108,526

Income from continuing operations, before income taxes
 
111,662

 
(3,595
)
 
108,067

Provision for income taxes
 
18,892

 
(807
)
 
18,085

Income from continuing operations
 
92,770

 
(2,788
)
 
89,982

Net income
 
92,915

 
(2,788
)
 
90,127

Net income attributable to Advanced Energy Industries, Inc.
 
92,840

 
(2,788
)
 
90,052


 
 
Six Months Ended June 30, 2018
 
 
 
 
 
 
Balances without
 
 
 
 
 
 
adoption of
 
 
As Reported
 
Adjustments
 
ASC 606
Net income
 
$
92,915

 
$
(2,788
)
 
$
90,127

Income from continuing operations, net of income taxes
 
$
92,770

 
$
(2,788
)
 
$
89,982

Changes in operating assets and liabilities, net of assets acquired:
 
 
 
 
 
 
Accounts and other receivable, net
 
(8,816
)
 
5,639

 
(3,177
)
Inventories
 
(31,620
)
 
(2,044
)
 
(33,664
)
Income taxes
 
7,831

 
(807
)
 
7,024

Net cash provided by operating activities from continuing operations
 
87,904

 

 
87,904


Revenue Recognition
We recognize revenue when we have satisfied our performance obligations which typically occurs when control of the products or services have been transferred to our customers. The transaction price is based upon the standalone selling price. In most transactions, we have no obligations to our customers after the date products are shipped, other than pursuant to warranty obligations. Shipping and handling fees billed to customers, if any, are recognized as revenue. The related shipping and handling costs are recognized in cost of sales. Support services include warranty and non-warranty repair services, upgrades, and refurbishments on the products we sell. Repairs that are covered under our standard warranty do not generate revenue.
Practical Expedients
We expense incremental costs of obtaining contracts when the amortization period of the costs is less than 1 year. These costs are included in selling, general, and administrative expenses.
Nature of goods and services
Products
Advanced Energy provides highly-engineered, mission-critical, precision power conversion, measurement and control solutions to our global customers. We design, manufacture, sell and support precision power products that transform electrical power into various usable forms. Our power conversion products refine, modify and control the raw electrical power from a utility and convert it into power that is predictable, repeatable and customizable. Our products enable thin film manufacturing processes such as plasma enhanced chemical and physical deposition and etch for various semiconductor and industrial products, industrial thermal applications for material and chemical processes, and specialty power for critical industrial applications. We also supply thermal instrumentation products for advanced temperature measurement and control in these markets.
Our products are designed to enable new process technologies, improve productivity, and lower the cost of ownership for our customers. We also provide repair and maintenance services for all of our products. We principally serve original equipment manufacturers ("OEM") and end customers in the semiconductor, flat panel display, high voltage, solar panel, and other industrial capital equipment markets. Our products are used in diverse markets, applications, and processes including the manufacture of capital equipment for semiconductor device manufacturing, thin film applications for thin film renewables and architectural glass, and for other thin film applications including flat panel displays, and industrial coatings.
Services
Our global support services group offers warranty and after-market repair services in the regions in which we operate, providing us with preventive maintenance opportunities. Our customers continue to pursue low cost of ownership of their capital equipment and are increasingly sensitive to the costs of system downtime. They expect that suppliers offer comprehensive local repair service and customer support. To meet these market requirements, we maintain a worldwide support organization comprising of both direct and indirect activities, through partnership with local distributors, primarily in the United States ("U.S."), the People’s Republic of China ("PRC"), Japan, South Korea, Taiwan, Germany, and United Kingdom.
As part of our ongoing service business, we satisfy our service obligations under preventative maintenance contracts and extended warranties which had previously been offered on our discontinued inverter products. Any up-front fees received for extended warranties or maintenance plans are deferred. Revenue under these arrangements is recognized ratably over the underlying terms as we do not have historical information which would allow us to project the estimated service usage pattern at this time. We have deferred revenue related to our extended warranties and service contracts totaling $34.5 million as of June 30, 2018 and $37.5 million as of December 31, 2017.
Disaggregation of Revenue
The following table presents our net sales by product line:
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2018
 
2017
 
2018
 
2017
Semiconductor capital market
$
127,291

 
$
117,020

 
$
263,301

 
$
221,668

Industrial power capital market
41,944

 
26,268

 
77,143

 
50,447

Global support
26,797

 
22,584

 
51,205

 
43,108

Total
$
196,032

 
$
165,872

 
$
391,649

 
$
315,223


The following table presents our net sales by geographic region:
 
 
Three Months Ended June 30,
 
 
2018
 
2017
Sales to external customers:
 
 
United States
 
$
122,904

 
62.7
%
 
$
114,268

 
69.0
%
Canada
 
42

 

 
16

 

North America
 
122,946

 
62.7

 
114,284

 
69.0

 
 

 
 
 

 
 
People's Republic of China
 
12,668

 
6.5

 
8,371

 
5.0

Republic of Korea
 
15,775

 
8.0

 
13,628

 
8.2

Other Asian countries
 
17,502

 
8.9

 
11,995

 
7.2

Asia
 
45,945

 
23.4

 
33,994

 
20.4

 
 

 
 
 

 
 
Germany
 
21,663

 
11.1

 
14,828

 
8.9

United Kingdom
 
1,611

 
0.8

 
2,766

 
1.7

Other European countries
 
3,867

 
2.0

 

 

Europe
 
27,141

 
13.9

 
17,594

 
10.6

Total
 
$
196,032

 
100.0
%
 
$
165,872

 
100.0
%