10-Q 1 adtn-20220331.htm 10-Q 10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _______ to _______

 

Commission File Number: 000-24612

 

ADTRAN, Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

63-0918200

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

901 Explorer Boulevard

Huntsville, Alabama

35806-2807

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (256) 963-8000

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common Stock, Par Value $0.01 per share

 

ADTN

 

The NASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

 

 

 

 

Non-accelerated filer

 

 

Smaller reporting company

 

 

 

 

 

 

 

 

Emerging growth company

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

As of May 4, 2022, the registrant had 49,120,235 shares of common stock, $0.01 par value per share, outstanding.

 

 

 

 


 

ADTRAN, Inc.

Quarterly Report on Form 10-Q

For the three months ended March 31, 2022

Table of Contents

 

Item

Number

 

 

 

Page

Number

 

 

 

Cautionary Note Regarding Forward-Looking Statements

 

3

 

 

Glossary of Selected Terms

 

6

 

 

PART I. FINANCIAL INFORMATION

 

 

 

 

 

 

 

1

 

Financial Statements:

 

 

 

 

Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021 – (Unaudited)

 

7

 

 

Condensed Consolidated Statements of (Loss) Income for the three months ended March 31, 2022 and 2021 – (Unaudited)

 

8

 

 

Condensed Consolidated Statements of Comprehensive Loss for the three months ended March 31, 2022 and 2021 – (Unaudited)

 

9

 

 

Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2022 and 2021 (Unaudited)

 

10

 

 

Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021 – (Unaudited)

 

12

 

 

Notes to Condensed Consolidated Financial Statements – (Unaudited)

 

13

2

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

30

3

 

Quantitative and Qualitative Disclosures About Market Risk

 

40

4

 

Controls and Procedures

 

41

 

 

 

 

 

 

 

PART II. OTHER INFORMATION

 

 

1

 

Legal Proceedings

 

42

1A

 

Risk Factors

 

42

2

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

45

6

 

Exhibits

 

 

 

 

SIGNATURE

 

48

 

 

 

 

 

 

 

 

 

 

 

 

 

2


 

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of ADTRAN, Inc. (“ADTRAN”, the “Company”, “we”, “our” or “us”). ADTRAN and its representatives may from time to time make written or oral forward-looking statements, including statements contained in this report, our other filings with the Securities and Exchange Commission (the “SEC”) and other communications with our stockholders. Any statement that does not directly relate to a historical or current fact is a forward-looking statement. Generally, the words, “believe”, “expect”, “intend”, “estimate”, “anticipate”, “will”, “may”, “could” and similar expressions identify forward-looking statements. We caution you that any forward-looking statements made by us or on our behalf are subject to uncertainties and other factors that could affect the accuracy of such statements. The following are some of the risks that could affect our financial performance or could cause actual results to differ materially from those expressed or implied in our forward-looking statements:

 

Risks related to the Business Combination Agreement with ADVA

The consummation of the proposed business combination transaction (the “Business Combination”) pursuant to ADTRAN’s business combination agreement with ADVA and Acorn HoldCo (the “Business Combination Agreement”) is subject to a number of conditions, and the Business Combination Agreement may be terminated by each of ADTRAN and ADVA under certain circumstances. If the Business Combination is not completed, the price of our common stock may be adversely affected.
Acorn HoldCo, which will be the holding company of ADTRAN and ADVA following the completion of the Business Combination, may enter into a domination and/or profit and loss transfer agreement with ADVA after the closing of the Business Combination that could be disadvantageous to Acorn HoldCo.
The pendency of the Business Combination, during which ADTRAN and ADVA are subject to certain operating restrictions, as well as uncertainty about the effects of the Business Combination, could have an adverse effect on ADTRAN’s, ADVA’s and the combined group's businesses and cash flows, financial condition, results of operations and the market value of Acorn HoldCo's shares following the consummation of the Business Combination.
Negative publicity related to the Business Combination, including post-closing integration measures, may adversely affect ADTRAN, ADVA and the combined group after the Business Combination.
Certain of our directors and executive officers and certain of the designees to the pre-closing Acorn HoldCo board of directors may have interests in the Business Combination that may be different from, or in addition to, those of ADTRAN stockholders generally.
We have incurred and expect to continue to incur significant transaction fees and costs in connection with the Business Combination.
Risks relating to the businesses of ADTRAN and ADVA after the completion of the Business Combination may have a significant adverse impact on Acorn HoldCo's business and financial performance.
The combined group may fail to realize the anticipated strategic and financial benefits sought from the Business Combination.
Following the completion of the Business Combination, ADVA will be majority owned by Acorn HoldCo. While Acorn HoldCo may enter into a domination agreement with ADVA, the effectiveness of such agreement may be delayed as a result of litigation or otherwise or may not occur, which may have an adverse effect on the ability to realize synergies and cost reductions and the market value of Acorn HoldCo shares.
The combined group may experience a loss of customers or may fail to win new customers in certain countries.
ADTRAN, ADVA or the combined group may be unable to retain and motivate their respective personnel successfully while the Business Combination is pending or following the completion of the Business Combination.

 

Risks related to our financial results and Company success

Our revenue for a particular period can be difficult to predict, and a shortfall in revenue may harm our operating results.
The lengthy sales and approval process required by service providers for new products could result in fluctuations in our revenue.
We depend heavily on sales to certain customers; the loss of any of these customers would significantly reduce our revenue and net income.

 

3


 

Our exposure to the credit risks of our customers and distributors may make it difficult to collect accounts receivable and could adversely affect our operating results, financial condition and cash flows.
We expect gross margins to vary over time, and our levels of product and services gross margins may not be sustainable.
Our dependence on a limited number of suppliers for certain raw materials, key components and ODM products, combined with supply shortages, have prevented and may continue to prevent us from delivering our products on a timely basis, which has had and may continue to have a material adverse effect on operating results and could have a material adverse effect on customer relations.
We compete in markets that have become increasingly competitive, which may result in reduced gross profit margins and market share.
Our estimates regarding future warranty obligations may change due to product failure rates, installation and shipment volumes, field service repair obligations and other rework costs incurred in correcting product failures. If our estimates change, our liability for warranty obligations may increase or decrease, impacting future cost of revenue.
Managing our inventory is complex and may include write-downs of excess or obsolete inventory.
The continuing growth of our international operations could expose us to additional risks, increase our costs and adversely affect our operating results, financial condition and cash flows.
If we are unable to integrate future acquisitions successfully, it could adversely affect our operating results, financial condition and cash flows.
Our success depends on attracting and retaining key personnel.
If we fail to manage our exposure to worldwide financial and securities markets successfully, our operating results and financial statements could be materially impacted.
The elimination of LIBOR after June 2023 may affect our financial results.
There are risks associated with our revolving credit agreement and future indebtedness.
We are exposed to adverse currency exchange rate fluctuations in jurisdictions where we transact in local currency, which could harm our financial results and cash flows.

 

Risks related to COVID-19

The ongoing COVID-19 pandemic has impacted and may continue to impact our business, results of operations and financial condition, particularly our supply chain and workforce.

 

Risks related to our control environment

We are currently in the process of implementing a new enterprise resource planning ("ERP") software solution. If we do not effectively implement this project, or any future associated updates, our operations could be significantly disrupted.
Breaches of our information systems and cyber-attacks could compromise our intellectual property and cause significant damage to our business and reputation.
If we fail to maintain proper and effective internal controls over financial reporting we could have a material weakness in those internal controls, that if not remediated, could materially adversely affect us.

 

Risks related to the telecommunications industry

We must continue to update and improve our products and develop new products to compete and to keep pace with improvements in communications technology.
Our failure or the failure of our contract manufacturers to comply with applicable environmental regulations could adversely impact our results of operations.
If our products do not interoperate with our customers’ networks, installations may be delayed or canceled, which could harm our business.
We engage in research and development activities to develop new, innovative solutions and to improve the application of developed technologies, and as a consequence may miss certain market opportunities enjoyed by larger companies with substantially greater research and development efforts and which may focus on more leading edge development.

 

4


 

Our strategy of outsourcing a portion of our manufacturing requirements to subcontractors located in various international regions may result in us not meeting our cost, quality or performance standards.
Our failure to maintain rights to intellectual property used in our business could adversely affect the development, functionality and commercial value of our products.
Software under license from third parties for use in certain of our products may not continue to be available to us on commercially reasonable terms.
Our use of open source software could impose limitations on our ability to commercialize our products.
We may incur liabilities or become subject to litigation that would have a material effect on our business.
If we are unable to successfully develop and maintain relationships with SIs, service providers and enterprise VARs, our revenue may be negatively affected.

 

Risks related to the regulatory environments in which we do business

We are subject to complex and evolving U.S. and foreign laws, regulations and standards governing the conduct of our business. Violations of these laws and regulations may harm our business, subject us to penalties and to other adverse consequences.
Changes in trade policy in the U.S. and other countries, specifically the U.K. and China, including the imposition of additional tariffs and the resulting consequences, may adversely impact our gross profits, gross margins, results of operations and financial condition.
New or revised tax regulations, changes in our effective tax rate, recognition of a valuation allowance or assessments arising from tax audits may have an adverse impact on our results.

 

The foregoing list of risks is not exclusive. For a more detailed description of the risk factors associated with our business, see Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 25, 2022 (the “2021 Form 10-K”), as well as the risk factors set forth in Part II, Item 1A of this Quarterly Report on Form 10-Q. We caution investors that other factors may prove to be important in the future in affecting our operating results. New factors emerge from time to time, and it is not possible for us to predict all of these factors, nor can we assess the impact each factor, or a combination of factors, may have on our business.

You are further cautioned not to place undue reliance on these forward-looking statements because they speak only of our views as of the date that the statements were made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

 

 

5


 

GLOSSARY OF SELECTED TERMS

 

Below are certain acronyms, concepts and defined terms commonly used in our industry and in this Quarterly Report on Form 10-Q, along with their meanings:

 

Acronym/Concept/

 

Defined Term

Meaning

CPE

Customer-Premises Equipment

CSP

Communication Service Provider

DSO

Days Sales Outstanding

ERP

Enterprise Resource Planning Software

FCC

Federal Communications Commission

LAN

Local Area Network

RDOF

Rural Digital Opportunity Fund

SEC

Securities and Exchange Commission

Service Provider

Entity that provides voice, data or video services to consumers and businesses

System Integrator or SI

Person or company that specializes in bringing together component subsystems into a whole and ensuring that those subsystems function together

U.K.

United Kingdom

U.S.

United States of America

VAR

Value-Added Reseller

WAN

Wide Area Network

 

 

6


 

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ADTRAN, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except per share amounts)

 

 

 

March 31,

 

 

December 31,

 

 

 

2022

 

 

2021

 

ASSETS

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

53,979

 

 

$

56,603

 

Restricted cash

 

 

52

 

 

 

215

 

Short-term investments (includes $429 and $350 of available-for-sale securities as of
   March 31, 2022 and December 31, 2021, respectively, reported at fair value)

 

 

429

 

 

 

350

 

Accounts receivable, less allowance for credit losses of $0 as of March 31, 2022 and
   December 31, 2021

 

 

150,111

 

 

 

158,742

 

Other receivables

 

 

17,373

 

 

 

11,228

 

Inventory, net

 

 

171,121

 

 

 

139,891

 

Prepaid expenses and other current assets

 

 

9,076

 

 

 

9,296

 

Total Current Assets

 

 

402,141

 

 

 

376,325

 

Property, plant and equipment, net

 

 

54,384

 

 

 

55,766

 

Deferred tax assets, net

 

 

8,939

 

 

 

9,079

 

Goodwill

 

 

6,968

 

 

 

6,968

 

Intangibles, net

 

 

18,405

 

 

 

19,293

 

Other non-current assets

 

 

30,542

 

 

 

30,971

 

Long-term investments (includes $29,129 and $29,717 of available-for-sale securities as of
   March 31, 2022 and December 31, 2021, respectively, reported at fair value)

 

 

67,713

 

 

 

70,615

 

Total Assets

 

$

589,092

 

 

$

569,017

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

Accounts payable

 

$

127,111

 

 

$

102,489

 

Unearned revenue

 

 

19,454

 

 

 

17,737

 

Accrued expenses and other liabilities

 

 

18,736

 

 

 

13,673

 

Accrued wages and benefits

 

 

13,953

 

 

 

14,900

 

Income tax payable, net

 

 

3,519

 

 

 

6,560

 

Total Current Liabilities

 

 

182,773

 

 

 

155,359

 

Non-current unearned revenue

 

 

9,381

 

 

 

9,271

 

Pension liability

 

 

10,667

 

 

 

11,402

 

Deferred compensation liability

 

 

29,691

 

 

 

31,383

 

Other non-current liabilities

 

 

4,264

 

 

 

4,500

 

Total Liabilities

 

 

236,776

 

 

 

211,915

 

Commitments and contingencies (see Note 17)

 

 

 

 

 

 

Stockholders' Equity

 

 

 

 

 

 

Common stock, par value $0.01 per share; 200,000 shares authorized;
   
79,652 shares issued and 49,133 shares outstanding as of March 31, 2022 and
   
79,652 shares issued and 49,063 shares outstanding as of December 31, 2021

 

 

797

 

 

 

797

 

Additional paid-in capital

 

 

290,839

 

 

 

288,946

 

Accumulated other comprehensive loss

 

 

(13,556

)

 

 

(11,914

)

Retained earnings

 

 

734,249

 

 

 

740,820

 

Treasury stock at cost: 30,519 and 30,590 shares at March 31, 2022 and
   December 31, 2021, respectively

 

 

(660,013

)

 

 

(661,547

)

Total Stockholders' Equity

 

 

352,316

 

 

 

357,102

 

Total Liabilities and Stockholders' Equity

 

$

589,092

 

 

$

569,017

 

 

See accompanying notes to condensed consolidated financial statements.

 

7


 

ADTRAN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME

(Unaudited)

(In thousands, except per share amounts)

 

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2022

 

 

2021

 

Revenue

 

 

 

 

 

 

Network Solutions

 

$

138,374

 

 

$

113,809

 

Services & Support

 

 

16,144

 

 

 

13,724

 

Total Revenue

 

 

154,518

 

 

 

127,533

 

Cost of Revenue

 

 

 

 

 

 

Network Solutions

 

 

90,653

 

 

 

65,001

 

Services & Support

 

 

9,549

 

 

 

8,931

 

Total Cost of Revenue

 

 

100,202

 

 

 

73,932

 

Gross Profit

 

 

54,316

 

 

 

53,601

 

Selling, general and administrative expenses

 

 

27,893

 

 

 

27,435

 

Research and development expenses

 

 

26,491

 

 

 

27,501

 

Operating Loss

 

 

(68

)

 

 

(1,335

)

Interest and dividend income

 

 

204

 

 

 

290

 

Interest expense

 

 

(30

)

 

 

(6

)

Net investment (loss) gain

 

 

(3,415

)

 

 

996

 

Other (expense) income, net

 

 

(226

)

 

 

1,999

 

(Loss) Income Before Income Taxes

 

 

(3,535

)

 

 

1,944

 

Income tax benefit (expense)

 

 

2,408

 

 

 

(1,048

)

Net (Loss) Income

 

$

(1,127

)

 

$

896

 

 

 

 

 

 

 

 

Weighted average shares outstanding – basic

 

 

49,113

 

 

 

48,336

 

Weighted average shares outstanding – diluted

 

 

49,113

 

 

 

49,004

 

 

 

 

 

 

 

 

(Loss) earnings per common share – basic

 

$

(0.02

)

 

$

0.02

 

(Loss) earnings per common share – diluted

 

$

(0.02

)

 

$

0.02

 

 

See accompanying notes to condensed consolidated financial statements.

 

8


 

ADTRAN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited)

(In thousands)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2022

 

 

2021

 

Net (Loss) Income

 

$

(1,127

)

 

$

896

 

Other Comprehensive (Loss) Income, net of tax

 

 

 

 

 

 

Net unrealized loss on available-for-sale securities

 

 

(724

)

 

 

(192

)

Defined benefit plan adjustments

 

 

(13

)

 

 

99

 

Foreign currency translation loss

 

 

(905

)

 

 

(1,863

)

Other Comprehensive (Loss) Income, net of tax

 

 

(1,642

)

 

 

(1,956

)

Comprehensive Loss, net of tax

 

$

(2,769

)

 

$

(1,060

)

 

See accompanying notes to condensed consolidated financial statements.

 

 

9


 

ADTRAN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

(In thousands, except per share amounts)

 

 

 

Common
Shares

 

 

Common
Stock

 

 

Additional
Paid-In
Capital

 

 

Retained
Earnings

 

 

Treasury
Stock

 

 

Accumulated Other Comprehensive Loss

 

 

Total
Stockholders'
Equity

 

Balance as of December 31, 2021

 

 

79,652

 

 

$

797

 

 

$

288,946

 

 

$

740,820

 

 

$

(661,547

)

 

$

(11,914

)

 

$

357,102

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(1,127

)

 

 

 

 

 

 

 

 

(1,127

)

Other comprehensive loss, net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,642

)

 

 

(1,642

)

Dividend payments ($0.09 per share)

 

 

 

 

 

 

 

 

 

 

 

(4,438

)

 

 

 

 

 

 

 

 

(4,438

)

Dividends accrued on unvested RSUs

 

 

 

 

 

 

 

 

 

 

 

32

 

 

 

 

 

 

 

 

 

32

 

Deferred compensation adjustments, net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(18

)

 

 

 

 

 

(18

)

PSUs, RSUs and restricted stock vested

 

 

 

 

 

 

 

 

 

 

 

(895

)

 

 

841

 

 

 

 

 

 

(54

)

Stock options exercised

 

 

 

 

 

 

 

 

 

 

 

(143

)

 

 

711

 

 

 

 

 

 

568

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

1,893

 

 

 

 

 

 

 

 

 

 

 

 

1,893

 

Balance as of March 31, 2022

 

 

79,652

 

 

$

797

 

 

$

290,839

 

 

$

734,249

 

 

$

(660,013

)

 

$

(13,556

)

 

$

352,316

 

 

See accompanying notes to condensed consolidated financial statements.

 

 

10


 

ADTRAN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

(In thousands, except per share amounts)

 

 

 

Common
Shares

 

 

Common
Stock

 

 

Additional
Paid-In
Capital

 

 

Retained
Earnings

 

 

Treasury
Stock

 

 

Accumulated Other Comprehensive Loss

 

 

Total
Stockholders'
Equity

 

Balance as of December 31, 2020

 

 

79,652

 

 

$

797

 

 

$

281,466

 

 

$

781,813

 

 

$

(679,493

)

 

$

(11,639

)

 

$

372,944

 

Net income

 

 

 

 

 

 

 

 

 

 

 

896

 

 

 

 

 

 

 

 

 

896

 

Other comprehensive loss, net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,956

)

 

 

(1,956

)

Dividend payments ($0.09 per share)

 

 

 

 

 

 

 

 

 

 

 

(4,361

)

 

 

 

 

 

 

 

 

(4,361

)

Dividends accrued on unvested RSUs

 

 

 

 

 

 

 

 

 

 

 

(68

)

 

 

 

 

 

 

 

 

(68

)

Deferred compensation adjustments, net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(50

)

 

 

 

 

 

(50

)

PSUs, RSUs and restricted stock vested

 

 

 

 

 

 

 

 

 

 

 

(1,683

)

 

 

1,602

 

 

 

 

 

 

(81

)

Stock options exercised

 

 

 

 

 

 

 

 

 

 

 

(476

)

 

 

1,720

 

 

 

 

 

 

1,244

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

1,807

 

 

 

 

 

 

 

 

 

 

 

 

1,807

 

Balance as of March 31, 2021

 

 

79,652

 

 

$

797

 

 

$

283,273

 

 

$

776,121

 

 

$

(676,221

)

 

$

(13,595

)

 

$

370,375

 

 

See accompanying notes to condensed consolidated financial statements.

 

11


 

ADTRAN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2022

 

 

2021

 

Cash flows from operating activities:

 

 

 

 

 

 

Net (loss) income

 

$

(1,127

)

 

$

896

 

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

3,661

 

 

 

4,122

 

Loss (gain) on investments

 

 

3,304

 

 

 

(1,161

)

Stock-based compensation expense

 

 

1,893

 

 

 

1,807

 

Other, net

 

 

(62

)

 

 

84

 

Inventory reserves

 

 

(1,754

)

 

 

(2,131

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable, net

 

 

8,697

 

 

 

(4,762

)

Other receivables

 

 

(6,205

)

 

 

(1,220

)

Inventory

 

 

(29,685

)

 

 

4,024

 

Prepaid expenses, other current assets and other assets

 

 

(1,170

)

 

 

(417

)

Accounts payable

 

 

24,818

 

 

 

5,629

 

Accrued expenses and other liabilities

 

 

3,803

 

 

 

3,317

 

Income taxes payable, net

 

 

(1,304

)

 

 

497

 

Net cash provided by operating activities

 

 

4,869

 

 

 

10,685

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

Purchases of property, plant and equipment

 

 

(1,461

)

 

 

(741

)

Proceeds from sales and maturities of available-for-sale investments

 

 

10,265

 

 

 

10,087

 

Purchases of available-for-sale investments

 

 

(11,504

)

 

 

(11,350

)

Net cash used in investing activities

 

 

(2,700

)

 

 

(2,004

)

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

Tax withholdings related to stock-based compensation settlements