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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2021
Income Tax Disclosure [Abstract] |
Schedule of Income before Income Tax, Domestic and Foreign | Income from continuing operations before provision (benefit) for income taxes was as follows (in thousands):
|  | Years Ended |
|  | 2021 |  |  | 2020 |  |  | 2019 |
Domestic |  | $ | (15,565 | ) |  | $ | (16,245 | ) |  | $ | (5,321 | )
Foreign |  |  | 46,869 |  |  |  | 24,512 |  |  |  | 18,347 |
Income before income taxes |  | $ | 31,304 |  |  | $ | 8,267 |  |  | $ | 13,026 |
Schedule of Components of Income Tax Expense (Benefit) | The provision (benefit) for income taxes consisted of the following (in thousands):
|  | Years Ended |
|  | 2021 |  |  | 2020 |  |  | 2019 |
Current tax provision: |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  | $ | — |  |  | $ | 2 |  |  | $ | — |
State |  |  | — |  |  |  | 15 |  |  |  | 13 |
Foreign |  |  | 5,308 |  |  |  | 3,186 |  |  |  | 2,446 |
Total current provision |  |  | 5,308 |  |  |  | 3,203 |  |  |  | 2,459 |
Deferred tax provision (benefit): |  |  |  |  |  |  |  |  |  |  |  |
U.S. federal |  |  | 739 |  |  |  | (573 | ) |  |  | (3,003 | )
State |  |  | 106 |  |  |  | 78 |  |  |  | (373 | )
Foreign |  |  | 650 |  |  |  | (354 | ) |  |  | (105 | )
Total deferred provision (benefit) |  |  | 1,495 |  |  |  | (849 | ) |  |  | (3,481 | )
Provision (benefit) for income taxes |  | $ | 6,803 |  |  | $ | 2,354 |  |  | $ | (1,022 | )
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the statutory U.S. federal tax rate to the Company’s effective tax rate was as follows (dollars in thousands):
|  | Years Ended |
|  | 2021 |  |  | 2020 |  |  | 2019 |
|  | Rate |  |  | Amount |  |  | Rate |  |  | Amount |  |  | Rate |  |  | Amount |
Computed provision for taxes based on income at statutory rate |  |  | 21.0 | % |  | $ | 6,574 |  |  |  | 21.0 | % |  | $ | 1,736 |  |  |  | 21.0 | % |  | $ | 2,735 |
Increase (decrease) in taxes resulting from: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
State tax benefit |  |  | (2.5 | )% |  |  | (778 | ) |  |  | (16.9 | )% |  |  | (1,397 | ) |  |  | 0.7 | % |  |  | 93 |
Foreign tax differential |  |  | (12.4 | )% |  |  | (3,890 | ) |  |  | (27.9 | )% |  |  | (2,304 | ) |  |  | (11.6 | )% |  |  | (1,514 | )
Expiration of state net operating tax loss carryforwards |  |  | 1.1 | % |  |  | 330 |  |  |  | 3.2 | % |  |  | 268 |  |  |  | 8.0 | % |  |  | 1,039 |
ASC 718 share based payment adjustment |  |  | 4.6 | % |  |  | 1,440 |  |  |  | 5.8 | % |  |  | 476 |  |  |  | — |  |  |  | — |
Incentive stock option compensation |  |  | (7.5 | )% |  |  | (2,346 | ) |  |  | (59.4 | )% |  |  | (4,907 | ) |  |  | (0.4 | )% |  |  | (55 | )
Non-qualified stock option and restricted stock tax deduction in excess of cumulative book deduction |  |  | (45.7 | )% |  |  | (14,315 | ) |  |  | (52.3 | )% |  |  | (4,324 | ) |  |  | (12.9 | )% |  |  | (1,679 | )
Executive compensation Section 162(m) limitation |  |  | 33.9 | % |  |  | 10,608 |  |  |  | 43.0 | % |  |  | 3,552 |  |  |  | 4.4 | % |  |  | 569 |
GILTI inclusion |  |  | 0.5 | % |  |  | 171 |  |  |  | 54.0 | % |  |  | 4,461 |  |  |  | 25.9 | % |  |  | 3,372 |
Other |  |  | (0.9 | )% |  |  | (293 | ) |  |  | (1.3 | )% |  |  | (106 | ) |  |  | (0.9 | )% |  |  | (110 | )
Valuation allowance |  |  | 29.7 | % |  |  | 9,302 |  |  |  | 59.3 | % |  |  | 4,899 |  |  |  | (42.0 | )% |  |  | (5,472 | )
Effective tax provision (benefit) |  |  | 21.7 | % |  | $ | 6,803 |  |  |  | 28.5 | % |  | $ | 2,354 |  |  |  | (7.8 | )% |  | $ | (1,022 | )
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets (liabilities) were as follows (in thousands):
|  | 2021 |  |  | 2020 |
Deferred tax assets: |  |  |  |  |  |  |  |
Allowance for doubtful accounts and sales returns |  | $ | 195 |  |  | $ | 357 |
Inventories |  |  | 444 |  |  |  | 691 |
Accrued vacation |  |  | 581 |  |  |  | 599 |
Accrued other expenses |  |  | 1,869 |  |  |  | 786 |
Stock-based compensation |  |  | 2,146 |  |  |  | 3,277 |
Pensions |  |  | 824 |  |  |  | 1,679 |
Net operating loss carryforwards |  |  | 48,223 |  |  |  | 38,642 |
Business, foreign, AMT and R&D credit carryforwards |  |  | 3,100 |  |  |  | 3,051 |
Prepaid expenses |  |  | 272 |  |  |  | 280 |
Capitalized R&D |  |  | 880 |  |  |  | 1,000 |
Operating lease liability |  |  | 6,894 |  |  |  | 1,687 |
Other |  |  | 67 |  |  |  | 19 |
Valuation allowance |  |  | (51,794 | ) |  |  | (42,502 | )
Total deferred tax assets |  | $ | 13,701 |  |  | $ | 9,566 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Foreign tax withholding |  | $ | (1,295 | ) |  | $ | (1,295 | )
Operating lease ROU assets |  |  | (6,862 | ) |  |  | (1,662 | )
Depreciation and amortization |  |  | (888 | ) |  |  | (424 | )
Amortization of R&D |  |  | (763 | ) |  |  | (846 | )
Net foreign earnings not permanently reinvested |  |  | (891 | ) |  |  | (617 | )
Total deferred tax liabilities |  |  | (10,699 | ) |  |  | (4,844 | )
Total net deferred tax assets |  | $ | 3,002 |  |  | $ | 4,722 |
The Company’s net deferred tax assets (liabilities) by jurisdiction were as follows (in thousands):
|  | 2021 |  |  | 2020 |
Federal deferred tax assets |  | $ | 2,838 |  |  | $ | 3,576 |
State deferred tax assets |  |  | 188 |  |  |  | 295 |
Japan deferred tax assets |  |  | 787 |  |  |  | 1,073 |
Switzerland deferred tax liabilities(1) |  |  | (811 | ) |  |  | (222 | )
Total net deferred tax assets |  | $ | 3,002 |  |  | $ | 4,722 |
(1)Includes $1,295,000 of pre-2019 withholding taxes on unremitted foreign earnings
Summary of Valuation Allowance | Under the incremental cash tax savings approach, the valuation allowance release (recapture) was as follows (in thousands):
|  | Years Ended |
|  | 2021 |  |  | 2020 |  |  | 2019 |
Federal |  | $ | (739 | ) |  | $ | 573 |  |  | $ | 3,003 |
State |  |  | (106 | ) |  |  | (78 | ) |  |  | 373 |
Valuation allowance release (recapture) |  | $ | (845 | ) |  | $ | 495 |  |  | $ | 3,376 |
Under the incremental cash tax savings approach, the valuation allowances remain as the usage of the remaining net operating losses and deferred tax assets will not result in cash tax savings and therefore provide no additional benefit were as follows (in thousands):
|  | 2021 |  |  | 2020 |
Cumulative federal valuation allowance |  | $ | 43,626 |  |  | $ | 34,681 |
Cumulative state valuation allowance |  |  | 7,848 |  |  |  | 7,399 |
Total U.S. valuation allowance |  | $ | 51,474 |  |  | $ | 42,080 |
Summary of Income Tax Examinations | The following tax years remain subject to examination:
Significant jurisdictions |  | Open Years
U.S. Federal |  | 2018 – 2020
California |  | 2017 – 2020
Switzerland |  | 2020
Japan |  | 2019 – 2020

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- Definition Tabular disclosure of income tax examinations that an enterprise is currently subject to or that have been completed in the current period typically including a description of the examination, the jurisdiction conducting the examination, the tax year(s) under examination, the likelihood of an unfavorable settlement, the range of possible losses, the liability recorded, the increase or decrease in the liability from the prior period, and any penalties and interest that have been recorded. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32718-109319 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 55 -Paragraph 217 -URI http://asc.fasb.org/extlink&oid=124434304&loc=d3e36027-109320 + Details
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