Product Warranties

3 Months Ended

Mar. 31, 2017

7. Product Warranties

The Company generally offers a two-year warranty for all of its products, though it is party to a limited number of supply agreements with certain customers contractually committing the Company to warranty and indemnification requirements exceeding those to which the Company has been exposed in the past. Effective January 1, 2017, the Company extended the warranty period to three years for certain military grade products sold after that date. The Company provides for the estimated cost of product warranties at the time product revenue is recognized. Factors influencing the Company’s warranty reserves include the number of units sold, historical and anticipated rates of warranty returns, and the cost per return. The Company periodically assesses the adequacy of warranty reserves and adjusts the amounts as necessary. Warranty obligations are included in “Accrued expenses” in the accompanying Condensed Consolidated Balance Sheets.

Product warranty activity for the three months ended March 31 was as follows (in thousands):


	Three Months Ended
	March 31,
	2017			2016
Balance at the beginning of the period	$	214		$	584
Accruals for warranties for products sold in the period		104			122
Fulfillment of warranty obligations		(73	)		(68	)
Revisions of estimated obligations		(60	)		(50	)

Balance at the end of the period	$	185		$	588