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Income Taxes (Tables)

12 Months Ended

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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