Summary of Significant Accounting Policies (Tables)
|
9 Months Ended |
Apr. 30, 2017 |
|---|
| Goodwill |
The Company’s goodwill consists of the following:
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
April 30,
2017 |
|
|
July 31,
2016 |
|
| |
|
(in
thousands) |
|
|
Semiconductor Test Reporting Unit
|
|
|
|
|
|
|
|
|
|
Merger with Credence Systems Corporation (August 29, 2008)
|
|
$ |
28,662 |
|
|
$ |
28,662 |
|
|
Acquisition of Step Tech Inc. (June 10, 2003)
|
|
|
14,368 |
|
|
|
14,368 |
|
|
Contactors Reporting Unit
|
|
|
|
|
|
|
|
|
|
Acquisition of Titan Semiconductor Tool LLC (February 2, 2015)
|
|
|
820 |
|
|
|
820 |
|
|
|
|
|
|
|
|
|
|
|
Total goodwill
|
|
$ |
43,850 |
|
|
$ |
43,850 |
|
|
|
|
|
|
|
|
|
|
|
| Amortizable Intangible Assets |
Amortizable intangible assets which relate to the acquisition of
Titan Semiconductor Tool LLC (“Titan”), ECT, Multitest,
and atg, and the merger with Credence Systems Corporation
(“Credence”), consist of the following, and are
included in intangible assets, net on the Company’s
Consolidated Balance Sheets:
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
As of April 30, 2017 |
|
|
Description
|
|
Estimated
Useful Life |
|
|
Gross Carrying
Amount |
|
|
Accumulated
Amortization |
|
|
Net Amount |
|
| |
|
(in years) |
|
|
(in thousands) |
|
|
(in thousands) |
|
|
(in thousands) |
|
|
Developed technology – Credence, ECT, Multitest, atg, and
Titan
|
|
|
6-20 |
|
|
$ |
29,882 |
|
|
$ |
(28,111 |
) |
|
$ |
1,771 |
|
|
Customer Relationships – Titan
|
|
|
20 |
|
|
|
670 |
|
|
|
(6 |
) |
|
|
664 |
|
|
Trade Names – Titan
|
|
|
10 |
|
|
|
70 |
|
|
|
(21 |
) |
|
|
49 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total amortizable intangible assets
|
|
|
|
|
|
$ |
30,622 |
|
|
$ |
(28,138 |
) |
|
$ |
2,484 |
|
|
Trademarks
|
|
|
|
|
|
|
6,427 |
|
|
|
— |
|
|
|
6,427 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total intangible assets
|
|
|
|
|
|
$ |
37,049 |
|
|
$ |
(28,138 |
) |
|
$ |
8,911 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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| |
|
|
|
|
As of July 31, 2016 |
|
|
Description
|
|
Estimated
Useful Life |
|
|
Gross Carrying
Amount |
|
|
Accumulated
Amortization |
|
|
Net Amount |
|
| |
|
(in years) |
|
|
(in thousands) |
|
|
(in thousands) |
|
|
(in thousands) |
|
|
Developed technology – Credence, ECT, Multitest, atg, and
Titan
|
|
|
6-20 |
|
|
$ |
29,882 |
|
|
$ |
(27,605 |
) |
|
$ |
2,277 |
|
|
Customer Relationships – ECT, Multitest, atg, and Titan
|
|
|
20 |
|
|
|
1,844 |
|
|
|
(1,174 |
) |
|
|
670 |
|
|
Maintenance agreements – ASL & Diamond
|
|
|
7 |
|
|
|
1,900 |
|
|
|
(1,900 |
) |
|
|
— |
|
|
Trade Names – Titan
|
|
|
10 |
|
|
|
70 |
|
|
|
(15 |
) |
|
|
55 |
|
|
Non-compete Agreements
|
|
|
1 |
|
|
|
8 |
|
|
|
(8 |
) |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total amortizable intangible assets
|
|
|
|
|
|
$ |
33,704 |
|
|
$ |
(30,702 |
) |
|
$ |
3,002 |
|
|
Trademarks
|
|
|
|
|
|
|
6,427 |
|
|
|
— |
|
|
|
6,427 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total intangible assets
|
|
|
|
|
|
$ |
40,131 |
|
|
$ |
(30,702 |
) |
|
$ |
9,429 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Expected Remaining Amortization of Intangible Assets |
The Company expects amortization for these intangible assets to
be:
|
|
|
|
|
|
Year ending July 31,
|
|
Amount
(in thousands) |
|
|
Remainder of 2017
|
|
$ |
159 |
|
|
2018
|
|
|
548 |
|
|
2019
|
|
|
517 |
|
|
2020
|
|
|
403 |
|
|
Thereafter
|
|
|
857 |
|
|
|
|
|
|
|
Total
|
|
$ |
2,484 |
|
|
|
|
|
|
|
| Change in Product Warranty Liability |
The following table shows the change in the Company’s product
warranty liability, as required by Topic 460, Guarantees, to
the FASB ASC for the nine months ended April 30, 2017 and
2016:
|
|
|
|
|
|
|
|
|
| |
|
Nine months Ended
April 30, |
|
|
Product Warranty Activity
|
|
2017 |
|
|
2016 |
|
| |
|
(in
thousands) |
|
|
Balance at beginning of period
|
|
$ |
2,725 |
|
|
$ |
2,983 |
|
|
Warranty expenditures for current period
|
|
|
(2,778 |
) |
|
|
(1,993 |
) |
|
Changes in liability related to pre-existing warranties
|
|
|
(14 |
) |
|
|
(33 |
) |
|
Provision for warranty costs in the period
|
|
|
3,243 |
|
|
|
1,894 |
|
|
|
|
|
|
|
|
|
|
|
Balance at end of period
|
|
$ |
3,176 |
|
|
$ |
2,851 |
|
|
|
|
|
|
|
|
|
|
|
| Reconciliation Between Basic and Diluted Net Income (Loss) Per Common Share |
Reconciliation between basic and diluted net income per common
share is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Three Months Ended
April 30, |
|
|
Nine months Ended
April 30, |
|
| |
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
| |
|
(in thousands,
except per share data) |
|
|
Net income
|
|
$ |
7,548 |
|
|
$ |
3,157 |
|
|
$ |
10,138 |
|
|
$ |
4,040 |
|
|
Basic EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding- basic
|
|
|
54,259 |
|
|
|
53,506 |
|
|
|
54,080 |
|
|
|
53,837 |
|
|
Basic income per share
|
|
$ |
0.14 |
|
|
$ |
0.06 |
|
|
$ |
0.19 |
|
|
$ |
0.08 |
|
|
Diluted EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding- basic
|
|
|
54,259 |
|
|
|
53,506 |
|
|
|
54,080 |
|
|
|
53,837 |
|
|
Plus: impact unvested RSUs
|
|
|
784 |
|
|
|
— |
|
|
|
581 |
|
|
|
60 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding- diluted
|
|
|
55,043 |
|
|
|
53,506 |
|
|
|
54,661 |
|
|
|
53,897 |
|
|
Diluted income per share
|
|
$ |
0.14 |
|
|
$ |
0.06 |
|
|
$ |
0.19 |
|
|
$ |
0.07 |
|
|
| Market Value and Maturities of Marketable Securities |
The market value and maturities of the Company’s marketable
securities are as follows:
|
|
|
|
|
| |
|
Total Amount |
|
| |
|
(in thousands) |
|
|
April 30, 2017
|
|
|
|
|
|
Due in less than one year
|
|
$ |
33,979 |
|
|
Due in 1 to 3 years
|
|
|
22,048 |
|
|
|
|
|
|
|
Total marketable securities
|
|
$ |
56,027 |
|
|
|
|
|
|
|
|
|
|
|
| |
|
Total Amount |
|
| |
|
(in thousands) |
|
|
July 31, 2016
|
|
|
|
|
|
Due in less than one year
|
|
$ |
25,257 |
|
|
Due in 1 to 3 years
|
|
|
31,099 |
|
|
|
|
|
|
|
Total marketable securities
|
|
$ |
56,356 |
|
|
|
|
|
|
|
| Market Value and Amortized Cost of Marketable Securities |
The market value and amortized cost of marketable securities are as
follows:
|
|
|
|
|
|
|
|
|
| |
|
Market
Value |
|
|
Amortized
Cost |
|
| |
|
(in
thousands) |
|
|
April 30, 2017
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
$ |
24,722 |
|
|
$ |
24,586 |
|
|
Government
|
|
|
13,657 |
|
|
|
13,677 |
|
|
Mortgage-Backed
|
|
|
2,327 |
|
|
|
2,326 |
|
|
Asset-Backed
|
|
|
15,321 |
|
|
|
15,306 |
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
56,027 |
|
|
$ |
55,895 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Market
Value |
|
|
Amortized
Cost |
|
| |
|
(in
thousands) |
|
|
July 31, 2016
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
$ |
22,574 |
|
|
$ |
22,405 |
|
|
Government
|
|
|
18,321 |
|
|
|
18,249 |
|
|
Mortgage-Backed
|
|
|
1,665 |
|
|
|
1,672 |
|
|
Asset-Backed
|
|
|
13,796 |
|
|
|
13,739 |
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
56,356 |
|
|
$ |
56,065 |
|
|
|
|
|
|
|
|
|
|
|
| Summary of Marketable Securities and Related Unrealized Gains and Losses |
The following table summarizes marketable securities and related
unrealized gains and losses as of April 30, 2017 and
July 31, 2016:
|
|
|
|
|
|
|
|
|
|
April 30, 2017
|
|
Market
Value |
|
|
Unrealized
Gain/(Loss) |
|
| |
|
(in
thousands) |
|
|
Securities < 12 months unrealized losses
|
|
$ |
27,791 |
|
|
$ |
(37 |
) |
|
Securities > 12 months unrealized losses
|
|
|
12,993 |
|
|
|
(38 |
) |
|
Securities < 12 months unrealized gains
|
|
|
6,188 |
|
|
|
5 |
|
|
Securities > 12 months unrealized gains
|
|
|
9,055 |
|
|
|
17 |
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
56,027 |
|
|
$ |
(53 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
July 31, 2016
|
|
Market
Value |
|
|
Unrealized
Gain/(Loss) |
|
| |
|
(in
thousands) |
|
|
Securities < 12 months unrealized losses
|
|
$ |
3,363 |
|
|
$ |
(4 |
) |
|
Securities > 12 months unrealized losses
|
|
|
6,925 |
|
|
|
(17 |
) |
|
Securities < 12 months unrealized gains
|
|
|
21,894 |
|
|
|
19 |
|
|
Securities > 12 months unrealized gains
|
|
|
24,174 |
|
|
|
74 |
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
56,356 |
|
|
$ |
72 |
|
|
|
|
|
|
|
|
|
|
|
| Summary of Property and Equipment |
The Company’s property and equipment as of April 30,
2017 and July 31, 2016 are summarized as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
April 30,
2017 |
|
|
July 31,
2016 |
|
|
Estimated
Useful Lives |
|
| |
|
(in thousands) |
|
|
(in years) |
|
|
Equipment spares
|
|
$ |
27,538 |
|
|
$ |
30,784 |
|
|
|
7 |
|
|
Machinery, equipment and internally manufactured systems
|
|
|
28,555 |
|
|
|
31,206 |
|
|
|
3-7 |
|
|
Office furniture and equipment
|
|
|
2,332 |
|
|
|
2,157 |
|
|
|
3-7 |
|
|
Purchased software
|
|
|
799 |
|
|
|
725 |
|
|
|
3 |
|
|
Land
|
|
|
2,508 |
|
|
|
2,508 |
|
|
|
— |
|
|
Buildings
|
|
|
7,990 |
|
|
|
7,944 |
|
|
|
10-40 years |
|
|
Leasehold improvements
|
|
|
11,995 |
|
|
|
10,312 |
|
|
|
Term of lease or
useful life, not to
exceed 10 years |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, gross
|
|
|
81,717 |
|
|
|
85,636 |
|
|
|
|
|
|
Accumulated depreciation and amortization
|
|
|
(54,752 |
) |
|
|
(60,153 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
$ |
26,965 |
|
|
$ |
25,483 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Inventories Excluding Interface Board Business |
|
| Components of Inventories |
The components of inventories are as follows:
|
|
|
|
|
|
|
|
|
| |
|
April 30,
2017 |
|
|
July 31,
2016 |
|
| |
|
(in
thousands) |
|
|
Material and purchased components
|
|
$ |
28,052 |
|
|
$ |
27,753 |
|
|
Work-in-process
|
|
|
26,028 |
|
|
|
20,218 |
|
|
Finished equipment, including inventory consigned to customers
|
|
|
24,886 |
|
|
|
22,015 |
|
|
|
|
|
|
|
|
|
|
|
Total inventories
|
|
$ |
78,966 |
|
|
$ |
69,986 |
|
|
|
|
|
|
|
|
|
|
|