Product Warranties

9 Months Ended

Sep. 30, 2016

12)	Product Warranties

The Company records the estimated costs to fulfill customer warranty obligations upon the recognition of the related revenue. While the Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers, the Company’s warranty obligation is affected by shipment volume, product failure rates, utilization levels, material usage, and supplier warranties on parts delivered to the Company. Should actual product failure rates, utilization levels, material usage, or supplier warranties on parts differ from the Company’s estimates, revisions to the estimated warranty liability would be required. The product warranty liability is included in other current liabilities in the condensed consolidated balance sheet.

Product warranty activities were as follows:


	Nine Months Ended September 30,
	2016			2015
Beginning of period	$	5,205		$	6,266
Product warranty liability from Newport Merger		3,040			—
Provision for product warranties		5,067			3,527
Direct charges to warranty liability		(5,213	)		(3,859	)
Foreign currency translation		43			(97	)

End of period ⁽¹⁾	$	8,142		$	5,837

⁽¹⁾	Short-term product warranty of $8,083 and long-term product warranty of $59 are included in other current liabilities and other liabilities, respectively, in the accompanying condensed consolidated balance sheet.