XML 26 R11.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Cash, Cash Equivalents and Investments | 12 Months Ended
--- | ---
Dec. 31, 2017
Cash, Cash Equivalents and Investments |
Cash, Cash Equivalents and Investments | Note 2. Cash, Cash Equivalents and Investments Our cash and cash equivalents consist of cash and instruments with original maturities of less than three months. Our investments consist of instruments with original maturities of more than three months. As of December 31, 2017 and 2016, our cash, cash equivalents and investments are classified as follows (in thousands):
|  | December 31, 2017 |  | December 31, 2016 |
|  |  |  |  | Gross |  | Gross |  |  |  |  |  |  |  | Gross |  | Gross |  |  |  |
|  | Amortized |  | Unrealized |  | Unrealized |  | Fair |  | Amortized |  | Unrealized |  | Unrealized |  | Fair |
|  | Cost |  | Gain |  | (Loss) |  | Value |  | Cost |  | Gain |  | (Loss) |  | Value |
Classified as: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash |  | $ | 43,610 |  | $ | — |  | $ | — |  | $ | 43,610 |  | $ | 23,948 |  | $ | — |  | $ | — |  | $ | 23,948 |
Cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Certificates of deposit 1 |  |  | 742 |  |  | — |  |  | — |  |  | 742 |  |  | 12,204 |  |  | — |  |  | — |  |  | 12,204 |
Total cash and cash equivalents |  |  | 44,352 |  |  | — |  |  | — |  |  | 44,352 |  |  | 36,152 |  |  | — |  |  | — |  |  | 36,152 |
Investments (available-for-sale): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Certificates of deposit 2 |  |  | 7,099 |  |  | — |  |  | (24) |  |  | 7,075 |  |  | 8,999 |  |  | 1 |  |  | (20) |  |  | 8,980 |
Corporate bonds |  |  | 25,602 |  |  | — |  |  | (69) |  |  | 25,533 |  |  | 8,479 |  |  | — |  |  | (47) |  |  | 8,432 |
Corporate equity securities |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 48 |  |  | 111 |  |  | — |  |  | 159 |
Total investments |  |  | 32,701 |  |  | — |  |  | (93) |  |  | 32,608 |  |  | 17,526 |  |  | 112 |  |  | (67) |  |  | 17,571 |
Total cash, cash equivalents and investments |  | $ | 77,053 |  | $ | — |  | $ | (93) |  | $ | 76,960 |  | $ | 53,678 |  | $ | 112 |  | $ | (67) |  | $ | 53,723 |
Contractual maturities on investments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Due within 1 year 3 |  | $ | 20,056 |  |  |  |  |  |  |  | $ | 20,032 |  | $ | 11,325 |  |  |  |  |  |  |  | $ | 11,415 |
Due after 1 through 5 years 4 |  |  | 12,645 |  |  |  |  |  |  |  |  | 12,576 |  |  | 6,201 |  |  |  |  |  |  |  |  | 6,156 |
|  | $ | 32,701 |  |  |  |  |  |  |  | $ | 32,608 |  | $ | 17,526 |  |  |  |  |  |  |  | $ | 17,571 |
| 1. |  | Certificate of deposit with original maturities of less than three months.
| 2. |  | Certificate of deposit with original maturities of more than three months.
| 3. |  | Classified as “Short-term investments” in our consolidated balance sheets.
| 4. |  | Classified as “Long-term investments” in our consolidated balance sheets.
We manage our investments as a single portfolio of highly marketable securities that is intended to be available to meet our current cash requirements. Certificates of deposit and corporate bonds are typically held until maturity. Corporate equity securities have no maturity and may be sold at any time. Our holding of corporate equity securities consisted of common stock of GCS Holdings, Inc. (“GHI”) (previously Global Communication Semiconductors, Inc), a Taiwan publicly-traded company. Previously, we also owned the common stock of Intelligent Epitaxy Technology, Inc. (“IntelliEpi”). We began classifying IntelliEpi stock as an available-for-sale security upon its initial public offering in 2013 and sold our remaining IntelliEpi stock in the second quarter of 2015 and we no longer hold any IntelliEpi stock as of December 31, 2017. In 2015, our cash proceeds from sales of IntelliEpi stock, an available-for-sale investment, were $902,000, our cost was $43,000 and our gross realized gain was $859,000. We began classifying GHI as an available-for-sale security in the second quarter of 2015 when we determined that there was sufficient trading volume in the exchange for the stock to be deemed readily marketable. During 2017, our cash proceeds from sales of GHI stock were $125,000. Our cost was $48,000 and our gross realized gain from sales of GHI stock was $77,000. As of December 31, 2017, we no longer hold any GHI stock. An unrealized gain of $111,000 and $432,000, net of tax, was recorded as of December 31, 2016 and 2015, respectively. In 2016, we sold some of our GHI stock and our cash proceeds from sales of this available-for-sale investment was $581,000. Our cost was $152,000 and our gross realized gain from sales of this available-for-sale investment was $429,000. There were no sales of GHI stock for the year ended December 31, 2015. The gross unrealized losses related to our portfolio of available-for-sale securities were primarily due to changes in interest rates and market and credit conditions of the underlying securities. We have determined that the gross unrealized losses on some of our available-for-sale securities as of December 31, 2017 are temporary in nature. We periodically review our investment portfolio to identify and evaluate investments that have indications of possible impairment. Factors considered in determining whether a loss is temporary include the magnitude of the decline in market value, the length of time the market value has been below cost (or adjusted cost), credit quality, and our ability and intent to hold the securities for a period of time sufficient to allow for any anticipated recovery in market value. A portion of our investments would generate a loss if we sold them on December 31, 2017. The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2017 (in thousands):
|  | In Loss Position |  | In Loss Position |  | Total In |
|  | < 12 months |  | > 12 months |  | Loss Position |
|  |  |  |  | Gross |  |  |  |  | Gross |  |  |  |  | Gross |
|  | Fair |  | Unrealized |  | Fair |  | Unrealized |  | Fair |  | Unrealized |
As of December 31, 2017 |  | Value |  | (Losses) |  | Value |  | (Losses) |  | Value |  | (Losses) |
Investments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Certificates of deposit |  | $ | 3,994 |  | $ | (16) |  | $ | 2,342 |  | $ | (8) |  | $ | 6,336 |  | $ | (24) |
Corporate bonds |  |  | 25,533 |  |  | (69) |  |  | — |  |  | — |  |  | 25,533 |  |  | (69) |
Total in loss position |  | $ | 29,527 |  | $ | (85) |  | $ | 2,342 |  | $ | (8) |  | $ | 31,869 |  | $ | (93) |
The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2016 (in thousands):
|  | In Loss Position |  | In Loss Position |  | Total In |
|  | < 12 months |  | > 12 months |  | Loss Position |
|  |  |  |  | Gross |  |  |  |  | Gross |  |  |  |  | Gross |
|  | Fair |  | Unrealized |  | Fair |  | Unrealized |  | Fair |  | Unrealized |
As of December 31, 2016 |  | Value |  | (Loss) |  | Value |  | (Loss) |  | Value |  | (Loss) |
Investments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Certificates of deposit |  | $ | 5,211 |  | $ | (20) |  | $ | 1,200 |  | $ | — |  | $ | 6,411 |  | $ | (20) |
Corporate bonds |  |  | 5,037 |  |  | (35) |  |  | 3,395 |  |  | (12) |  |  | 8,432 |  |  | (47) |
Total in loss position |  | $ | 10,248 |  | $ | (55) |  | $ | 4,595 |  | $ | (12) |  | $ | 14,843 |  | $ | (67) |
Investments in Privately-held Companies We have made strategic investments in private companies located in China in order to gain access at a competitive cost to raw materials that are critical to our substrate business (see Note 6). The investment balances for all of these companies, including minority investments indirectly in privately-held companies made by our consolidated subsidiaries, are accounted for under the equity method and included in “Other assets” in the consolidated balance sheets and totaled $9.8 million and $11.3 million as of December 31, 2017 and December 31, 2016, respectively. As of December 31, 2017, there were seven companies accounted for under the equity method. For the year ended December 31, 2017, we have recognized an impairment charge of $313,000 for one of the gallium companies. During the first quarter of 2017, management determined it unlikely that this company will recover from the difficult pricing environment and we wrote the investment down to zero. We had no impairment charges during 2016 and 2015. As noted above, in the second quarter of 2015, we re-classified our minority investment in GHI, which was accounted for under the cost method, as an available-for-sale security and valued the security at fair market value. As of December 31, 2017 and 2016, we no longer maintain any investments under the cost method. Fair Value Measurements We invest primarily in money market accounts, certificates of deposits, corporate bonds and notes, and government securities. ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes three levels of inputs that may be used to measure fair value. Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets of the asset or identical assets. Level 2 instrument valuations are obtained from readily-available, observable pricing sources for comparable instruments. Level 3 instrument valuations are obtained from unobservable inputs in which there is little or no market data, which require us to develop our own assumptions. On a recurring basis, we measure certain financial assets and liabilities at fair value, primarily consisting of our short-term and long-term investments. The type of instrument valued based on quoted market prices in active markets include our money market funds, which are generally classified within Level 1 of the fair value hierarchy. Other than corporate equity securities which are based on quoted market prices and classified as Level 1, we classify our available-for-sale securities including certificates of deposit and corporate bonds as having Level 2 inputs. The valuation techniques used to measure the fair value of these financial instruments having Level 2 inputs were derived from bank statements, quoted market prices, broker or dealer statements or quotations, or alternative pricing sources with reasonable levels of price transparency. There were no changes in valuation techniques or related inputs in the year ended December 31, 2017. There have been no transfers between fair value measurement levels during the year ended December 31, 2017. We place short-term foreign currency hedges that are intended to offset the potential cash exposure related to fluctuations in the exchange rate between the United States dollar and Japanese yen. We measure the fair value of these foreign currency hedges at each month end and quarter end using current exchange rates and in accordance with generally accepted accounting principles. At quarter end any foreign currency hedges not settled are netted in “Accrued liabilities” on the consolidated balance sheets and classified as Level 3 assets and liabilities. As of December 31, 2017, the net change in fair value from the placement of the hedge to settlement at each month end during the quarter had a de minimis impact to the consolidated results. The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis in accordance with ASC 820 as of December 31, 2017 (in thousands):
|  |  |  |  | Quoted Prices in |  |  |  |  | Significant |
|  |  |  |  | Active Markets of |  | Significant Other |  | Unobservable |
|  | Balance as of |  | Identical Assets |  | Observable Inputs |  | Inputs |
|  | December 31, 2017 |  | (Level 1) |  | (Level 2) |  | (Level 3) |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents and investments: |  |  |  |  |  |  |  |  |  |  |  |  |
Certificates of deposit |  | $ | 7,817 |  | $ | — |  | $ | 7,817 |  | $ | — |
Corporate bonds |  |  | 25,533 |  |  | — |  |  | 25,533 |  |  | — |
Total |  | $ | 33,350 |  | $ | — |  | $ | 33,350 |  | $ | — |
The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis in accordance with ASC 820 as of December 31, 2016 (in thousands):
|  |  |  |  | Quoted Prices in |  |  |  |  | Significant |
|  |  |  |  | Active Markets of |  | Significant Other |  | Unobservable |
|  | Balance as of |  | Identical Assets |  | Observable Inputs |  | Inputs |
|  | December 31, 2016 |  | (Level 1) |  | (Level 2) |  | (Level 3) |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents and investments: |  |  |  |  |  |  |  |  |  |  |  |  |
Certificates of deposit |  | $ | 21,184 |  | $ | — |  | $ | 21,184 |  | $ | — |
Corporate bonds |  |  | 8,432 |  |  | — |  |  | 8,432 |  |  | — |
Corporate equity securities |  |  | 159 |  |  | 159 |  |  | — |  |  | — |
Total |  | $ | 29,775 |  | $ | 159 |  | $ | 29,616 |  | $ | — |
Items Measured at Fair Value on a Nonrecurring Basis Certain assets that are subject to nonrecurring fair value measurements are not included in the table above. These assets include investments in privately-held companies accounted for by equity and cost method (See Note 6). For the year ended in December 31, 2017, we recognized an impairment charge of $313,000 for one of the gallium companies. During the first quarter of 2017, management determined it was unlikely that this company would recover from the difficult pricing environment and we wrote the investment down to zero. We had no impairment charges 2016 and 2015.

X
- References No definition available. + Details
Name: | us-gaap_CashAndCashEquivalentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure of cash, cash equivalents, and debt and equity securities, including any unrealized or realized gain (loss). + References No definition available. + Details
Name: | us-gaap_CashCashEquivalentsAndMarketableSecuritiesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration