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Reportable Segments | 12 Months Ended
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Jun. 30, 2013
Segment Reporting [Abstract] |
Reportable Segments | Reportable Segments The Company's operating and reportable segments are:
• | LED Products
• | Lighting Products
• | Power and RF Products
The Company's CODM reviews segment performance and allocates resources based upon segment revenues and segment gross profit. Reportable Segments Description LED Products Segment The Company's LED Products segment includes LED chips, LED components, and SiC materials. LED Chips LED Chip products include blue and green LED chips based on GaN and related materials. LED chips or die are solid-state electronic components used in a number of applications and are currently available in a variety of brightness levels, wavelengths (color) and sizes. The Company uses LED chips internally in the manufacturing of LED components. LED Chips are also sold externally to customers for use in a variety of applications including video screens, gaming displays, function indicator lights, and automotive backlights, headlamps and directional indicators. LED Components LED component products include a range of packaged LED products from the Company's XLamp® LED components and LED modules for lighting applications to the Company's high-brightness LED components. The Company's XLamp LED components are lighting class packaged LED products designed to meet a broad range of market needs for lighting applications including general illumination (both indoor and outdoor applications), portable, architectural, signal and transportation lighting. The LED Components segment produces XLamp LED components for use by the Company's LED lighting segment. The LED Components segment also sells XLamp LED components externally to manufacturing customers and manufacturing distributors for use in a variety of lighting applications. The Company's high brightness LED components consist of surface mount (SMD) and through-hole packaged LED products. The SMD LED component products are available in a full range of colors designed to meet a broad range of market needs. These products are sold to manufacturing customers and distributors in the video, signage, general illumination, automotive, gaming and specialty lighting markets. SiC Materials The Company's SiC materials are targeted for customers who use them to manufacture products for RF, power switching, gemstones and other applications. Corporate, government and university customers also buy SiC materials for research and development directed at RF and high power devices. The Company generally sells its SiC materials in bulk form, as a bare wafer or with SiC and GaN epitaxial films. Lighting Products Segment The Company's Lighting Products segment consists of both LED and traditional lighting systems. The Company designs, manufactures and sells lighting systems for indoor and outdoor applications, with its primary focus on LED lighting systems for the commercial, industrial and consumer markets. Lighting products are primarily sold to distributors who serve the indoor and outdoor lighting consumer and business-to-business markets. Power and RF Products Segment The Company's Power and RF Products segment includes power devices and RF devices. Power Devices The Company's power products are made from SiC and provide increased efficiency, faster switching speeds and reduced system size and weight over comparable silicon-based power devices. Power products are sold primarily to government contractors and distributors. RF Devices The Company's RF devices are made from SiC or GaN and provide improved efficiency, bandwidths and frequency of operation as compared to silicon or gallium arsenide. RF devices are sold primarily to government contractors and distributors. Financial Results by Reportable Segment The table below reflects the results of the Company's reportable segments as reviewed by the Company's CODM for fiscal 2013, 2012 and 2011. The Company uses substantially the same accounting policies to derive the segment results reported below as those used in the Company's consolidated financial statements. The Company's CODM does not review inter-segment revenue when evaluating segment performance and allocating resources to each segment. Thus, inter-segment revenue is not included in the segment revenues presented in the table below. As such, total segment revenue in the table below is equal to the Company's consolidated revenue. The Company's CODM reviews gross profit as the lowest and only level of segment profit. As such, all items below gross profit in the consolidated statements of income must be included to reconcile the consolidated gross profit presented in the table below to the Company's consolidated income before income taxes. In order to determine gross profit for each reportable segment, the Company allocates direct costs and indirect costs to each segment's cost of revenue. The Company allocates indirect costs, such as employee benefits for manufacturing employees, shared facilities services, information technology, purchasing, and customer service, when the costs are identifiable and beneficial to the reportable segment. The Company allocates these indirect costs based on a reasonable measure of utilization that considers the specific facts and circumstances of the costs being allocated. Inventory is normally transferred between the Company's reportable segments at cost. However, due to the vertically-integrated nature of the Company's business and the fixed cost nature of the Company's manufacturing operations, the Company will apportion lower of cost or market write-downs on products among the segments involved in producing the products. The lower of cost or market write-down is apportioned based on each segment's proportional production cost and is reported as an increase to each segment's cost of revenue. The Company's CODM evaluates segment performance and resource allocation after apportionment of any lower of cost or market write-downs. For the year ended June 30, 2013, the Company allocated $3.1 million for a lower of cost or market write-down from the Lighting Products segment to the LED Products segment. Unallocated costs in the table below are not reviewed by the Company's CODM when evaluating segment performance and allocating resources to each segment. These unallocated costs consist primarily of manufacturing employees' stock-based compensation, expenses for profit sharing and quarterly or annual incentive plans, matching contributions under the Company's 401(k) plan and acquisition related costs. Revenues, gross profit and gross margin for each of our segments are as follows (in thousands, except percentages):
| Revenues |  | Gross Profit and Gross Margin
| Year Ended |  | Year Ended
| June 30, 2013 |  | June 24, 2012 |  | June 26, 2011 |  | June 30, 2013 |  | June 24, 2012 |  | June 26, 2011
LED Products |  | $801,483 |  |  |  | $756,924 |  |  |  | $808,207 |  |  |  | $344,649 |  |  |  | $290,642 |  |  |  | $375,424 |
LED Products gross margin |  |  |  |  |  |  | 43 | % |  | 38 | % |  | 46 | %
Lighting Products | 495,089 |  |  | 334,704 |  |  | 81,784 |  |  | 148,947 |  |  | 103,396 |  |  | 23,686 |
Lighting Products gross margin |  |  |  |  |  |  | 30 | % |  | 31 | % |  | 29 | %
Power and RF Products | 89,410 |  |  | 73,030 |  |  | 97,624 |  |  | 48,127 |  |  | 32,051 |  |  | 49,828 |
Power and RF Products gross margin |  |  |  |  |  |  | 54 | % |  | 44 | % |  | 51 | %
Total segment reporting |  | $1,385,982 |  |  |  | $1,164,658 |  |  |  | $987,615 |  |  | 541,723 |  |  | 426,089 |  |  | 448,938 |
Unallocated costs |  |  |  |  |  |  | (18,463 | ) |  | (16,627 | ) |  | (13,165 | )
Consolidated gross profit |  |  |  |  |  |  |  | $523,260 |  |  |  | $409,462 |  |  |  | $435,773 |
Consolidated gross margin |  |  |  |  |  |  | 38 | % |  | 35 | % |  | 44 | %
Assets by Reportable Segment Inventory is the only asset reviewed by the Company's CODM when evaluating segment performance and allocating resources to the segments. The following table sets forth the Company's inventory by reportable segment for the fiscal years ended June 30, 2013 and June 24, 2012. Unallocated inventory in the table below is not allocated to the reportable segments because the Company's CODM does not review it when evaluating performance and allocating resources to each segment. Unallocated inventory consists primarily of manufacturing employees' stock-based compensation, profit sharing and quarterly or annual incentive compensation and matching contributions under the Company's 401(k) plan. The Company does not allocate assets other than inventory to the reportable segments because the Company's CODM does not review them when assessing segment performance and allocating resources. The CODM reviews all of the Company's assets other than inventory on a consolidated basis. Inventory, net for each of our segments is as follows (in thousands):
| Inventory, Net
| Year Ended
| June 30, 2013 |  | June 24, 2012
LED Products |  | $99,835 |  |  |  | $109,262 |
Lighting Products | 87,546 |  |  | 69,330 |
Power and RF Products | 6,593 |  |  | 6,100 |
Total segment reporting | 193,974 |  |  | 184,692 |
Unallocated inventory | 3,027 |  |  | 4,157 |
Consolidated inventory, net |  | $197,001 |  |  |  | $188,849 |
Geographic Information The Company conducts business in several geographic areas. Revenues are attributed to a particular geographic region based on the billing address for the products. The following table sets forth the percentage of revenues from external customers by geographic area for fiscal 2013, 2012 and 2011:
| For the Years Ended
| June 30, 2013 |  | June 24, 2012 |  | June 26, 2011
United States | 44 | % |  | 38 | % |  | 24 | %
China | 28 | % |  | 32 | % |  | 36 | %
Europe | 12 | % |  | 14 | % |  | 14 | %
South Korea | 2 | % |  | 2 | % |  | 4 | %
Japan | 7 | % |  | 8 | % |  | 7 | %
Malaysia | 1 | % |  | 2 | % |  | 2 | %
Taiwan | 2 | % |  | 1 | % |  | 5 | %
Other | 4 | % |  | 3 | % |  | 8 | %
Total | 100 | % |  | 100 | % |  | 100 | %
The following table sets forth the Company’s net property and equipment by country for the fiscal years ended June 30, 2013 and June 24, 2012 (in thousands):
| June 30, 2013 |  | June 24, 2012
United States |  | $419,267 |  |  |  | $452,249 |
China | 122,477 |  |  | 125,868 |
Other | 1,089 |  |  | 4,344 |
Total |  | $542,833 |  |  |  | $582,461 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8933-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8844-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8984-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8595-108599 + Details
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