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Restructuring Charges, Net of Reversals and Impairment, and Related Charges | 9 Months Ended
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Mar. 31, 2020
Restructuring And Related Activities [Abstract] |
Restructuring Charges, net of reversals, impairment, and related charges |
15. | Restructuring Charges, Net of Reversals, Impairment, and Related Charges.
The Company recorded $6.6 million and $19.4 million of restructuring charges, net of reversals and impairments during the three and nine months ended March 31, 2020, respectively. Total restructuring charges included facility related charges of $0.3 million and $8.2 million as well as charges for severance and benefits of $6.3 million and $11.2 million for the three and nine months ended March 31, 2020, respectively. During the first quarter of fiscal 2020, the Company moved to reduce its operat ing expenses by exiting a floor of its San Ignacio building in San Jose, California and consolidating its workforce. Also, the Company exited additional space in its Salem, New Hampshire facility, which includes general office and lab space. The Company has the intent and ability to sub-lease these facilities which it has ceased using and as such, has considered estimated future sub-lease income based on its existing le ase agreement s, as well as the local real estate market conditions, in measuring the amount of asset impairment. The Company also factored into its estimate the time for a sub-lease tenant to enter into an agreement and complete any improvements. F or the three months ended September 30, 2019, the Company recorded restructuring charges o f $3.9 million related to impairment of ROU assets from exited facilities. In addition, the Company recorded severance and benefits charges of $2.2 million related to its reduction-in-force action which had begun in the fourth quarter of fiscal 2019. During the second quarter of fiscal 2020, the Company continued its initiative to realign its operations resulting from the acquisition of Aerohive and consolidating its workforce. The Company exited its facility in Milpitas, California which includes general office and lab space. The Company has the intent and ability to sub-lease this facility which it has ceased using and as such has considered estimated future sub-lease income based on its existing lease agreement, as well as the local real estate market conditions in measuring the amount of asset impairment. The Company also factored into its estimate the time for a sub-lease tenant to enter into an agreement and complete any improvements. For the three months ended December 31, 2019, the Company recorded charges for the impairment of ROU assets of $2.8 million, long-lived assets of $0.9 million, and other charges of $0.2 million related to the exited facility. In addition, the Company recorded severance and benefits charges of $2.7 million related to its reduction-in-force action which began in the fourth quarter of fiscal 2019. During the third quarter of fiscal 2020, the Company continued its initiative to reduce cost by realigning its workforce. In addition, with the global disruptions and slow-down in the demand of its products caused by the global pandemic outbreak, COVID-19, and the uncertainty around the timing of the recovery of the market, the Company initiated a reduction-in-force plan (the 2020 Plan) to reduce its operating costs and enhance financial flexibility. The plan affected approximately 300 employees primarily from the research and development and sales organizations who were located mainly in US and India. The Company recorded restructuring charges of $5.8 million during the three months ended March 31, 2020 related to the 2020 Plan. We expect to incur additional charges related to this 2020 Plan through the first quarter of fiscal 2021. The costs associated with this restructuring plan primarily included employee severance and benefit expenses. The Company recorded additional severance and benefits charges of $0.5 million for the three months ended March 31, 2020 related to the prior period restructuring plans. In addition, the Company recorded facility related charges of $0.3 million related to its previously impaired facilities for the three months ended March 31, 2020. Certain amounts have been reclassified from restructuring liabilities and have been recorded as a reduction to operating lease ROU assets as of July 1, 2019. Restructuring liabilities related to severance and benefits obligations are recorded in “Other accrued liabilities” in the accompanying condensed consolidated balance sheets. Total restructuring and related liabilities as of March 31, 2020 consist of (in thousands):
|  | Excess Facilities |  |  | Severance Benefits |  |  | Total |
Balance as of June 30, 2019 |  | $ | 1,764 |  |  | $ | 3,559 |  |  | $ | 5,323 |
Period charges |  |  | — |  |  |  | 12,257 |  |  |  | 12,257 |
Period reversals |  |  | — |  |  |  | (1,044 | ) |  |  | (1,044 | )
Reclassification to reduce operating lease assets |  |  | (1,764 | ) |  |  | — |  |  |  | (1,764 | )
Period payments |  |  | — |  |  |  | (8,568 | ) |  |  | (8,568 | )
Balance as of March 31, 2020 |  | $ | — |  |  | $ | 6,204 |  |  | $ | 6,204 |

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -URI http://asc.fasb.org/topic&trid=2175745 + Details
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