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Restructuring Charges | 9 Months Ended
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Mar. 31, 2016
Restructuring And Related Activities [Abstract] |
Restructuring Charges |
7. | Restructuring Charges
As of March 31, 2016, restructuring liabilities were $4.2 million and consisted of obligations for severance benefits, contract termination and other expenses. During the three and nine months ended March 31, 2016, the Company recorded restructuring charges of $1.4 million and $10.0 million, respectively. Included in the restructuring charges were offsets for future sub-leasing income. The Company has estimated the sub-lease income based on its existing leases agreement, as well the real estate market conditions at the respective locations. The Company also factored into its estimate the time for a sub-lease tenant to enter into an agreement and complete any improvements. The Company will reevaluate any sub-lease income on a regular basis and adjust the accrual as necessary if and when facts should change. Fiscal 2015 Restructuring: Phase One During the fourth quarter of fiscal 2015, we reduced costs through targeted restructuring activities intended to reduce operating costs and realign our organization in the current competitive environment. We initiated a plan to reduce our worldwide headcount by more than 225 employees, primarily in sales and marketing, as well as research and development, consolidate specific global administrative functions, and shift certain operating costs to lower cost regions in the United States, among other actions. Phase Two During fiscal 2016, we continued our initiative to realign our operations with a second phase by abandoning excess facilities, primarily in San Jose, California; Salem, New Hampshire; Research Triangle Park, North Carolina and Shannon, Ireland. The abandoned facilities represented approximately 29% of the floor space in the aggregate at these locations and included general office and warehouse space. There may be additional abandonments of excess facilities in future periods as we further align our organization to our business and operational needs. During the first quarter of fiscal 2016, in conjunction with the exiting of facilities noted above, the Company recorded restructuring charges of $5.6 million including $5.4 million for excess facility charges and adjustments to service benefits of $0.2 million. Excess facilities charges included $4.1 million of accrued lease costs pertaining to the estimated future obligations for non-cancelable lease payments for excess facilities and accelerated depreciation of leasehold improvements in the amount of $1.3 million. This charge is reflected in "Restructuring charge, net of reversals" in the condensed consolidated statements of operations. During the second quarter of fiscal 2016, in conjunction with the exiting of the facilities noted above, the Company incurred restructuring charges of $3.0 million including $2.9 million in excess facilities charges related to amending its lease in North Carolina, thereby reducing it floor space by 36%, and adjustments to severance benefits of $0.2 million. Excess facilities charges included accelerated depreciation of leasehold improvements in the amount of $1.9 million and contract termination charges and professional fees of $1.0 million. This charge is reflected in "Restructuring charge, net of reversals" in the condensed consolidated statements of operations. During the third quarter of fiscal 2016, in conjunction with the exiting of facilities noted above, the Company incurred restructuring charges of $1.4 million. Excess facilities charges included accelerated depreciation of leasehold improvements in the amount of $1.2 million associated with the North Carolina facility, $0.2 million related to a change in the accrued lease costs pertaining to the estimated future obligations for non-cancelable lease payments for our San Jose, California facility and the reversal of $0.2 million of estimated severance benefits. This charge is reflected in “Restructuring charge, net of reversals” in the condensed consolidated statements of operations. The excess facilities payments will continue through fiscal year 2023, due to the length of the lease agreements. Restructuring liabilities consist of (in thousands):
|  | Excess Facilities |  |  | Severance Benefits |  |  | Other |  |  | Total |
Balance as of June 30, 2015 |  | $ | — |  |  | $ | 5,737 |  |  | $ | 117 |  |  | $ | 5,854 |
Period charges |  |  | 5,409 |  |  |  | 321 |  |  |  | 178 |  |  |  | 5,908 |
Period reversals |  |  | — |  |  |  | (235 | ) |  |  | (70 | ) |  |  | (305 | )
Non cash adjustments |  |  | (1,344 | ) |  |  | — |  |  |  | — |  |  |  | (1,344 | )
Period payments |  |  | (42 | ) |  |  | (4,207 | ) |  |  | (125 | ) |  |  | (4,374 | )
Balance as of September 30, 2015 |  |  | 4,023 |  |  |  | 1,616 |  |  |  | 100 |  |  |  | 5,739 |
Period charges |  |  | 2,874 |  |  |  | 347 |  |  |  | 53 |  |  |  | 3,274 |
Period reversals |  |  | (14 | ) |  |  | (209 | ) |  |  | (20 | ) |  |  | (243 | )
Non cash adjustments |  |  | (1,876 | ) |  |  | — |  |  |  | — |  |  |  | (1,876 | )
Period payments |  |  | (653 | ) |  |  | (1,365 | ) |  |  | (133 | ) |  |  | (2,151 | )
Balance as of December 31, 2015 |  |  | 4,354 |  |  |  | 389 |  |  |  | — |  |  |  | 4,743 |
Period charges |  |  | 1,540 |  |  |  | — |  |  |  | 6 |  |  |  | 1,546 |
Period reversals |  |  | (14 | ) |  |  | (174 | ) |  |  | — |  |  |  | (188 | )
Non cash adjustments |  |  | (1,243 | ) |  |  | — |  |  |  | — |  |  |  | (1,243 | )
Period payments |  |  | (440 | ) |  |  | (215 | ) |  |  | (6 | ) |  |  | (661 | )
Balance as of March 31, 2016 |  | $ | 4,197 |  |  | $ | — |  |  | $ | — |  |  | $ | 4,197 |
Less: current portion included in Other accrued liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2,199 |
Restructuring accrual included in Other long-term liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 1,998 |

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB TOPIC 5.P.4) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140904-122747 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 5.P.3) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140864-122747 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 5 -Section P -Subsection 3, 4 + Details
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