Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2017shares | |
Document Information [Line Items] | |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2017 |
Document Fiscal Year Focus | 2,017 |
Document Fiscal Period Focus | FY |
Trading Symbol | SIMO |
Entity Registrant Name | SILICON MOTION TECHNOLOGY CORP |
Entity Central Index Key | 1,329,394 |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | No |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Entity Filer Category | Accelerated Filer |
Entity Common Stock, Shares Outstanding | 143,162,340 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current Assets | ||
Cash and cash equivalents | $ 359,453 | $ 274,483 |
Short-term investments | 6,941 | 3,302 |
Notes and accounts receivable, net | 79,135 | 73,599 |
Inventories | 94,186 | 71,887 |
Restricted assets-current | 19,515 | 44,393 |
Noncurrent assets held for sale | 3,363 | |
Prepaid expenses and other current assets | 9,567 | 5,873 |
Total current assets | 568,797 | 476,900 |
Long-term investments | 120 | |
Property and equipment, net | 51,370 | 47,892 |
Deferred income tax assets, net | 3,402 | 3,983 |
Goodwill | 58,964 | 68,656 |
Intangible assets, net | 7,429 | 5,227 |
Other assets | 3,770 | 3,248 |
Total assets | 693,732 | 606,026 |
Current Liabilities | ||
Notes and accounts payable | 56,423 | 31,739 |
Bank loan | 25,000 | 25,000 |
Income tax payable | 11,492 | 20,271 |
Current portion of long-term payable | 566 | 240 |
Accrued expenses and other current liabilities | 83,763 | 68,736 |
Total current liabilities | 177,244 | 145,986 |
Long-term payable, net of current portion | 108 | 367 |
Other long-term liabilities | 22,329 | 16,910 |
Total liabilities | 199,681 | 163,263 |
Commitments and Contingencies (Note 18) | ||
Shareholders' Equity | ||
Ordinary Shares at US$0.01 par value per share Authorized: 500,000 thousand shares Issued and outstanding: 141,311 thousand shares in 2016 and 143,162 thousand shares in 2017 | 1,431 | 1,413 |
Additional paid-in capital | 242,487 | 226,658 |
Accumulated other comprehensive income (loss) | 2,643 | (1,032) |
Retained Earnings | 247,490 | 215,724 |
Total shareholders' equity | 494,051 | 442,763 |
Total liabilities and shareholders' equity | $ 693,732 | $ 606,026 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
Ordinary Shares, par value | $ 0.01 | $ 0.01 |
Ordinary Shares, Authorized | 500,000,000 | 500,000,000 |
Ordinary Shares, Issued | 143,162,000 | 141,311,000 |
Ordinary Shares, outstanding | 143,162,000 | 141,311,000 |
Consolidated Statements Of Inco
Consolidated Statements Of Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
NET SALES | $ 523,404 | $ 556,146 | $ 361,297 |
COST OF SALES | 272,210 | 281,541 | 176,765 |
GROSS PROFIT | 251,194 | 274,605 | 184,532 |
OPERATING EXPENSES | |||
Research and development | 102,053 | 92,405 | 71,161 |
Sales and marketing | 25,868 | 25,765 | 20,173 |
General and administrative | 16,933 | 17,072 | 15,714 |
Impairment of goodwill | 10,337 | 0 | 0 |
Amortization of intangible assets | 2,534 | 2,103 | 1,051 |
Gain from disposal of noncurrent assets held for sale | (1,880) | ||
Total operating expenses | 155,845 | 137,345 | 108,099 |
OPERATING INCOME | 95,349 | 137,260 | 76,433 |
NON-OPERATING INCOME (EXPENSES) | |||
Gain from disposal of short-term investments | 103 | 2 | 3 |
Interest income | 4,268 | 2,158 | 2,025 |
Foreign exchange gain (loss), net | (157) | (692) | 76 |
Impairment of long-term investments | (120) | (13) | |
Interest expense | (423) | (127) | (47) |
Other income (loss), net | (19) | 42 | 10 |
Total non-operating income | 3,652 | 1,370 | 2,067 |
INCOME BEFORE INCOME TAX | 99,001 | 138,630 | 78,500 |
INCOME TAX EXPENSE | 24,046 | 27,690 | 18,249 |
NET INCOME | $ 74,955 | $ 110,940 | $ 60,251 |
EARNINGS PER ORDINARY SHARE: | |||
Basic | $ 0.53 | $ 0.79 | $ 0.44 |
Diluted | $ 0.52 | $ 0.78 | $ 0.43 |
WEIGHTED AVERAGE ORDINARY SHARES OUTSTANDING | |||
Basic (Thousands) | 142,738 | 140,919 | 138,100 |
Diluted (Thousands) | 143,606 | 142,050 | 139,634 |
EARNINGS PER ADS (one ADS equals four ordinary shares): | |||
Basic | $ 2.10 | $ 3.15 | $ 1.75 |
Diluted | $ 2.09 | $ 3.12 | $ 1.73 |
WEIGHTED AVERAGE ADS OUTSTANDING | |||
Basic (Thousands) | 35,684 | 35,230 | 34,525 |
Diluted (Thousands) | 35,902 | 35,513 | 34,909 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Net income | $ 74,955 | $ 110,940 | $ 60,251 |
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX EFFECT OF NIL | |||
Change in net foreign currency translation adjustments | 3,390 | (1,555) | (1,868) |
Change in deferred pension gain (loss) | 285 | (110) | (4) |
OTHER COMPREHENSIVE INCOME (LOSS) | 3,675 | (1,665) | (1,872) |
TOTAL COMPREHENSIVE INCOME | $ 78,630 | $ 109,275 | $ 58,379 |
Consolidated Statements Of Chan
Consolidated Statements Of Changes In Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Ordinary Shares | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings (accumulated deficit) |
Beginning Balance at Dec. 31, 2014 | $ 304,100 | $ 1,356 | $ 190,783 | $ 2,505 | $ 109,456 |
Beginning Balance, shares at Dec. 31, 2014 | 135,622 | ||||
Net income | 60,251 | 60,251 | |||
Other comprehensive income | (1,872) | (1,872) | |||
Issuance of ordinary shares for Shannon Systems acquisition | 7,640 | $ 16 | 7,624 | ||
Issuance of ordinary shares for Shannon Systems acquisition, Shares | 1,560 | ||||
Stock-based compensation expenses | 10,418 | 10,418 | |||
Issuance of ordinary shares upon exercise of employee stock options and restricted stock units, shares | 2,339 | ||||
Issuance of ordinary shares upon exercise of employee stock options and restricted stock units | 441 | $ 23 | 418 | ||
Dividends declared | (36,480) | (36,480) | |||
Ending Balance at Dec. 31, 2015 | 344,498 | $ 1,395 | 209,243 | 633 | 133,227 |
Ending Balance, shares at Dec. 31, 2015 | 139,521 | ||||
Net income | 110,940 | 110,940 | |||
Other comprehensive income | (1,665) | (1,665) | |||
Stock-based compensation expenses | 17,364 | 17,364 | |||
Issuance of ordinary shares upon exercise of employee stock options and restricted stock units, shares | 1,790 | ||||
Issuance of ordinary shares upon exercise of employee stock options and restricted stock units | 69 | $ 18 | 51 | ||
Dividends declared | (28,443) | (28,443) | |||
Ending Balance at Dec. 31, 2016 | $ 442,763 | $ 1,413 | 226,658 | (1,032) | 215,724 |
Ending Balance, shares at Dec. 31, 2016 | 141,311 | 141,311 | |||
Net income | $ 74,955 | 74,955 | |||
Other comprehensive income | 3,675 | 3,675 | |||
Stock-based compensation expenses | 15,494 | 15,494 | |||
Issuance of ordinary shares upon exercise of employee stock options and restricted stock units, shares | 1,851 | ||||
Issuance of ordinary shares upon exercise of employee stock options and restricted stock units | 353 | $ 18 | 335 | ||
Dividends declared | (43,189) | (43,189) | |||
Ending Balance at Dec. 31, 2017 | $ 494,051 | $ 1,431 | $ 242,487 | $ 2,643 | $ 247,490 |
Ending Balance, shares at Dec. 31, 2017 | 143,162 | 143,162 |
Consolidated Statements Of Cha7
Consolidated Statements Of Changes In Shareholders' Equity (Parenthetical) - $ / shares | Oct. 24, 2017 | Oct. 24, 2016 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Dividends declared, per share | $ 0.3 | $ 0.2 | $ 0.075 | $ 0.050 | $ 0.050 | $ 0.050 | $ 0.0500 | $ 0.0375 | $ 0.0375 | $ 0.0375 | $ 0.30 | $ 0.20 | $ 0.2625 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||
Net income | $ 74,955 | $ 110,940 | $ 60,251 | ||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation and amortization | 10,599 | 9,482 | 7,936 | ||
Amortization of intangible assets | 2,534 | 2,103 | 1,051 | ||
Gain from disposal of short-term investments | (103) | (2) | (3) | ||
Impairment of long-term investments | 120 | 13 | |||
Stock-based compensation | 15,494 | 17,364 | 10,418 | ||
Loss on disposal of property and equipment | 4 | 33 | 10 | ||
Impairment of goodwill | 10,337 | 0 | 0 | ||
Gain from disposal of noncurrent assets held for sale | (1,880) | ||||
Deferred income taxes | 581 | (3,373) | 911 | ||
Changes in operating assets and liabilities: | |||||
Short-term investments | (3,208) | (2,710) | |||
Notes and accounts receivable | (5,156) | (14,620) | (29,179) | ||
Inventories | (22,299) | (24,777) | (410) | ||
Prepaid expenses and other current assets | 1,585 | (1,313) | (664) | ||
Other assets | (138) | (5) | 136 | ||
Notes and accounts payable | 24,248 | 9,198 | 7,651 | ||
Accrued expenses and other current liabilities | 458 | 12,180 | 11,020 | ||
Income tax payable | (8,779) | 6,876 | (4,301) | ||
Other liabilities | 4,529 | 4,179 | 1,119 | ||
Net cash provided by operating activities | 103,881 | 125,568 | 65,946 | ||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||
Purchase of held-to-maturity financial assets | (4,000) | ||||
Proceeds from sale of held-to-maturity financial assets | 4,000 | ||||
Business acquisition-net of cash, cash equivalents, and restricted cash acquired | (2,865) | (30,286) | |||
Increase of prepaid expenses and other current assets | (508) | ||||
Purchase of property and equipment | (11,683) | (12,220) | (23,664) | ||
Net cash used in investing activities | (14,548) | (8,220) | (58,458) | ||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||
Proceeds from issuance of ordinary shares upon exercise of employee stock options | 380 | 93 | 494 | ||
Proceeds from bank loan | 25,000 | 25,000 | |||
Repayments of bank loan | (25,000) | ||||
Dividends paid | (32,120) | (22,899) | (20,765) | ||
Net cash provided by (used in) financing activities | (31,740) | 2,194 | (20,271) | ||
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH | 57,593 | 119,542 | (12,783) | [1] | |
EFFECT OF EXCHANGE RATE CHANGES | 2,753 | (521) | (953) | ||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF YEAR | 321,177 | 202,156 | [1] | 215,892 | [1] |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF YEAR | 381,523 | 321,177 | 202,156 | [1] | |
SUPPLEMENTAL INFORMATION | |||||
Interest paid | 367 | 105 | 6 | ||
Income taxes paid | 30,910 | $ 24,300 | 20,494 | ||
Cash paid for business acquisition, net of cash, cash equivalents, and restricted cash acquired | 2,865 | 30,286 | |||
Shannon Systems | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||
Business acquisition-net of cash, cash equivalents, and restricted cash acquired | (30,286) | ||||
SUPPLEMENTAL INFORMATION | |||||
Fair value of assets acquired, net of cash, cash equivalents, and restricted cash acquired | 43,661 | ||||
Issuance of stock | (7,640) | ||||
Cash paid for business acquisition, net of cash, cash equivalents, and restricted cash acquired | 30,286 | ||||
Shannon Systems | Other Noncurrent Liabilities | |||||
SUPPLEMENTAL INFORMATION | |||||
Other liabilities | $ (5,735) | ||||
Bigtera | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||
Business acquisition-net of cash, cash equivalents, and restricted cash acquired | (2,865) | ||||
SUPPLEMENTAL INFORMATION | |||||
Fair value of assets acquired, net of cash, cash equivalents, and restricted cash acquired | 4,586 | ||||
Cash paid for business acquisition, net of cash, cash equivalents, and restricted cash acquired | 2,865 | ||||
Bigtera | Other Noncurrent Liabilities | |||||
SUPPLEMENTAL INFORMATION | |||||
Other liabilities | (477) | ||||
Bigtera | Other Current Liabilities | |||||
SUPPLEMENTAL INFORMATION | |||||
Other liabilities | $ (1,244) | ||||
[1] | The restricted cash is only included in the amount of "as adjusted" item. |
Organization and Operations
Organization and Operations | 12 Months Ended |
Dec. 31, 2017 | |
Organization and Operations | 1. ORGANIZATION AND OPERATIONS Silicon Motion Technology Corporation (“SMTC”, collectively with its subsidiaries the “Company”) is the global leader in supplying NAND flash controllers for solid state storage devices and the merchant leader in supplying SSD controllers. The Company has the broadest portfolio of controller technologies and solutions and ship over 750 million NAND controllers annually, more than any other company in the world. The Company’s controllers are widely used in embedded storage products such as SSDs and eMMCs which are found in smartphones, PCs and industrial and commercial applications. The Company also supply specialized high-performance hyperscale datacenter and industrial SSD solutions. The Company’s customers include most of the NAND flash vendors, storage device module makers and leading OEMs. The Company acquired SMI Taiwan in April 2005. Originally SMI Taiwan was known as Feiya Technology Corporation (“Feiya”), a Taiwan corporation which was incorporated in April 1997 but had changed its name to SMI Taiwan after acquiring in August 2002 Silicon Motion, Inc., a California corporation (“SMI USA”), which was incorporated in November 1995. Feiya was originally a flash memory products company and SMI USA a graphics processor company. In April 2007, the Company acquired FCI, a leading designer of RF ICs for mobile TV and wireless communications based in South Korea. In July 2015, the Company acquired Shanghai Baocun Information Technology Co., Ltd. (“Shannon Systems”), China’s leading enterprise-class PCIe SSD company based in Shanghai, China. In July 2017, the Company acquired Bigtera, a software defined storage company. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). The consolidated financial statements include the accounts of SMTC and its wholly-owned subsidiaries. The Company owns 100% of the outstanding shares in all of its subsidiaries. All significant intercompany balances and transactions have been eliminated upon consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. The actual results could differ from those estimates. Concentration of Credit Risk and Significant Customers Financial instruments that potentially subject the Company to a significant concentration of credit risk consist principally of cash equivalents, short term investments and accounts receivable. Cash, cash equivalents and short-term investments balances are maintained with high quality financial institutions, the composition and maturities of which are regularly monitored by management. The Company believes that the concentration of credit risk in its trade receivables, is substantially mitigated by the Company’s credit evaluation process, relatively short collection terms and the high level of credit worthiness of its customers. The Company performs ongoing credit evaluations of its customers’ financial conditions and limits the amount of credit extended based upon payment history and the customer’s current credit worthiness. The Company regularly reviews the allowance for bad debt and doubtful accounts by considering factors such as historical experience, credit quality, age of the accounts receivable balances and current economic conditions that may affect a customer’s ability to pay. Historically, a relatively small number of customers have accounted for a significant portion of our net revenue. Sales to one customer in 2015 and 2016, and two customers in 2017 accounted for 10% or more of the Company’s net sales, and these sales represented 30%, 28% and 39% of the Company’s net sales in 2015, 2016 and 2017, respectively. In 2015 and 2016, the significant customer was SK Hynix and in 2017, SK Hynix and Intel. The Company’s top ten customers in 2015, 2016 and 2017 accounted for approximately 72%, 75% and 72% of net sales, respectively. Fair Value of Financial Instruments The carrying amount of the Company’s financial instruments, including cash and cash equivalents, notes and accounts receivable and notes and accounts payables approximates fair value due to the short-term maturity of the instruments. Fair values of short-term investments represent quoted market prices, if available. If no quoted market prices are available, fair values are estimated based on discounted cash flow, or other valuation techniques. Long-term investments in privately-held companies with no readily determinable market value are recorded using the cost method, since the cost of obtaining verifiable fair value is unreasonably high. The Company periodically evaluates these investments for impairment. If it is determined that an other-than-temporary decline has occurred in the carrying value, an impairment loss is recorded for that period. The Company’s long-term liabilities approximate their fair values as they contain interest rates that vary according to market interest rates. Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that assets or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the Company. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1 — Use unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 — Use observable inputs other than Level 1 prices such as quoted prices for identical or similar instruments in markets that are not active, quoted prices for similar instruments in active markets, and model-based valuation in which all significant inputs are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Use inputs that are generally unobservable and reflect the use of significant management judgments and estimates. See Note 20, “Fair Value Measurement”, for the related disclosure. Cash Equivalents The Company considers all highly liquid instruments acquired with a remaining maturity of three months or less when purchased to be cash equivalents. In addition, time deposits with maturities ranging from more than three months to one year are considered qualified as cash equivalents as the nature of the time deposits are similar to cash such that without advance notice to the bank, they can be readily converted into known amounts of cash with the principal of the time deposits protected and not subject to penalty in the event of an early withdrawal. Also, the risk of changes in value because of changes in interest rates is insignificant due to the fact that the Company can still earn interest based on a rate close to the on-going Short-term Investments The Company’s short-term investments primarily includes short-term income yielding investments with original maturities greater than three months from the purchase date and remaining maturities less than one year. These short-term investments consist mostly of bond funds and principal protected notes that are bought and held principally for the purpose of selling them in the near term and are classified as trading securities as well as senior notes classified as held-to-maturity Allowance for Doubtful Receivables An allowance for doubtful receivables is provided based on a review of the collectability of accounts receivables. The Company determines the amount of allowance for doubtful receivables by examining the historical collection experience and current trends in the credit quality of its customers as well as its internal credit policies. Inventories Inventories are stated at the lower of cost or market value. Inventories are recorded at standard cost and adjusted to the approximate weighted-average cost at the balance sheet date. Market value represents the current replacement cost for raw materials, work in process and finished goods. The Company assesses its inventory for estimated obsolescence or unmarketable inventory based upon management’s assumptions about future demand and market conditions. In estimating reserves for obsolescence, the Company primarily evaluates estimates based on the timing of the introduction of new products and the quantities remaining of old products and provides reserves for inventory on hand in excess of the estimated demand. Estimated losses on slow-moving items are recognized and included in the allowance for losses. Long-term Investments The Company has long-term investments in companies that it does not exercise significant influence and accounts for these investments under the cost method. Management regularly evaluates financial information related to these investments to determine whether an other than temporary decline in their value exists. Factors indicative of an other than temporary decline include recurring operating losses, credit defaults and subsequent rounds of financings at an amount below the cost basis of the investment. Management periodically weighs all quantitative and qualitative factors in determining if any impairment loss exists. When a decline in value is deemed to be other-than-temporary, the Company recognizes an impairment loss in other income and expense. Noncurrent Assets Held for Sale Non-current Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Significant additions, renewals and betterments are capitalized, while maintenance and repairs are expensed as incurred. Depreciation is computed using the straight-line method over estimated useful lives that range as follows: buildings — 25 to 50 years; machinery and equipment — 3 to 6 years; furniture and fixtures — 3 to 8 years; software — 1 to 5 years; leasehold and buildings improvement — the shorter of the estimated useful life or lease term, which is generally 2 to 6 years. Depreciation expense recognized for the years ended December 31, 2015, 2016 and 2017 was approximately US$7,936 thousand, US$9,482 thousand and US$10,599 thousand, respectively. Upon the sale or other disposal of property and equipment, the related cost and accumulated depreciation are removed from the accounts, and any gain or loss is credited or charged to operating income. Government Grants Grants received by the Company from the Korean government to assist with specific research and development activities are deducted from those research and development costs incurred, in the period in which the related expenses are incurred, to the extent that they are non-refundable. Goodwill and Intangible Assets Goodwill is the excess of the purchase price paid over the fair value of the net tangible and intangible assets acquired in a business combination. Intangible assets, which consist primarily of development technology, are amortized over their estimated useful lives, of 3.5 to 5.5 years. Impairment of Goodwill and Long-Lived Assets The Company evaluates the recoverability of long-lived assets whenever events or changes in circumstances indicate the carrying value may not be recoverable. The determination of recoverability is based on an estimate of undiscounted cash flows expected to result from the use of an asset and its eventual disposition. The estimate of cash flows is based upon, among other things, certain assumptions about expected future operating performance, growth rates and other factors. Estimates of undiscounted cash flows may differ from actual cash flows due to, among other things, technological changes, economic conditions, changes to the business model or changes in operating performance. If the sum of the undiscounted cash flows is less than the carrying value, an impairment loss is recognized, measured as the amount by which the carrying value exceeds the fair value of the asset. Fair value is determined by reference to quoted market prices, if available, or discounted cash flows, as appropriate. See Note 11, “Goodwill and Acquired Intangible Assets,” regarding impairment testing in fiscal year 2015, 2016 and 2017. The Company monitors the recoverability of goodwill recorded in connection with acquisitions, by reporting unit, annually, or sooner if events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company conducts its annual impairment test of goodwill on November 30. Reporting units may be operating segments as a whole or an operation one level below an operating segment, referred to as a component. Prior to fiscal 2017, goodwill impairment is tested using a two-step In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2017-04, Estimating fair value is performed by utilizing various valuation approaches, such as income approach or market approach. The total of all reporting unit fair values was also compared to the Company’s market capitalization plus control premium for reasonableness. See Note 11, “Goodwill and Acquired Intangible Assets,” regarding impairment testing. Other Assets Other assets primarily consist of industrial property right and deposits for office leases. Restricted Assets Restricted assets consist of deposits required for litigation and restricted cash. Restricted cash represents cash set aside as collateral for obtaining capacity and borrowings as well as cash received from government grants with restriction on its usage. Bank loans Loans from financial institutions are stated at the amount of unpaid principal. Bank loans comprise borrowings which are held by banks based in Taiwan. Other long-term liabilities Other long-term liabilities primarily consist of payable to former shareholders of Shannon Systems and unrecognized tax benefit. Pension Costs For employees under defined contribution pension plans, pension costs are recorded based on the actual contributions made to employees’ individual pension accounts. For employees under defined benefit pension plans, pension costs are recorded based on actuarial calculations. Revenue Recognition Revenue from product sales is generally recognized upon shipment to the customer provided that the Company has received a signed purchase order, the price is fixed or determinable, transfer of title has occurred in accordance with the shipping terms specified in the arrangement with the customer, collectibility from the customer is considered reasonably assured, product returns are reasonably estimable and there are no remaining significant obligations or customer acceptance requirements. Revenue on development service orders is generally recognized upon completion and customer acceptance of contractually agreed milestones. The Company grants certain distributors limited rights of return and price protection rights on unsold products. The return rights are generally limited to five percent of the monetary value of products purchased within the preceding six months, provided that the distributor places a corresponding restocking order of equal or greater value. An allowance for sales returns for distributors and all customers is recorded at the time of sale based on historical returns information available, management’s judgment and any known factors at the time the financial statements are prepared that would significantly affect the allowance. Price protection rights are based on the inventory products the distributors have on hand at the date the price protection is offered. A reserve for price adjustments is recorded based on the estimated products on hand at the distributors and historical experience. The actual price adjustments to distributors incurred by the Company are minimal. The Company provides a warranty period of one year for manufacturing defects of its products. Warranty returns have been infrequent and relate to defective or off-specification Research and Development Research and development costs consist of expenditures incurred during the course of planned research and investigation aimed at the discovery of new knowledge that will be useful in developing new products or at significantly enhancing existing products as well as expenditures incurred for the design and testing of product alternatives. All expenditures related to research and development activities of the Company are charged to operating expenses when incurred. Third-party research and development costs are expensed when the contracted work has been performed or as milestone results have been achieved. Income Taxes The provision for income tax represents income tax paid and payable for the current year plus changes in the deferred income tax assets and liabilities during the years. Deferred income tax assets are recognized for net operating loss carryforwards, research and development credits, and temporary differences. The Company believes that uncertainty exists regarding the realizability of certain deferred income tax assets and, accordingly, has established a valuation allowance for those deferred income tax assets to the extent the realizability is not deemed to be more likely than not. Deferred income tax assets and liabilities are measured using enacted tax rates. The Company utilizes a two step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained in a dispute with taxing authorities, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate settlement. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits in income tax expense. Foreign Currency Transactions Foreign currency transactions are recorded at the rates of exchange in effect when the transaction occurs. Gains or losses, resulting from the application of different foreign exchange rates when cash in foreign currency is converted into the entities’ functional currency, or when foreign currency receivables and payables are settled, are credited or charged to income in the period of conversion or settlement. At the balance sheet date, assets and liabilities denominated in foreign currencies are remeasured based on prevailing exchange rates and any resulting gains or losses are credited or charged to income. Translation of Foreign Currency Financial Statements The reporting currency of the Company is the U.S. dollars. The functional currency of some of the Company’s subsidiaries is the local currency of the respective entity. Accordingly, the financial statements of the foreign subsidiaries were translated into U.S. dollars at the following exchange rates: assets and liabilities — current rate on the balance sheet date; shareholders’ equity — historical rates; income and expenses — average rate during the period. The resulting translation adjustment is recorded as a separate component of comprehensive income. Comprehensive Income (Loss) Comprehensive income and loss represents net income (loss) plus the results of certain changes in shareholders’ equity during a period from non-owner Year Ended December 31, 2015 Year Ended December 31, 2016 Year Ended December 31, 2017 US$ US$ US$ Foreign Defined Accumulated Foreign Defined Accumulated Foreign Defined Accumulated Beginning balance 3,354 (849 ) 2,505 1,486 (853 ) 633 (69 ) (963 ) (1,032 ) Current-period change (1,868 ) (4 ) (1,872 ) (1,555 ) (110 ) (1,665 ) 3,390 285 3,675 Ending balance 1,486 (853 ) 633 (69 ) (963 ) (1,032 ) 3,321 (678 ) 2,643 Legal Contingencies The Company is regularly involved in various claims and legal proceedings. Periodically, the Company reviews the status of each significant matter and assesses the potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount can be estimated, the Company accrues a liability for the estimated loss. Because of uncertainties related to these matters, accruals are based only on the best information available at the time. As additional information becomes available, the Company reassesses the potential liability related to the pending claims and litigation and revises these estimates as appropriate. Such revisions in the estimates of the potential liabilities could have a material impact on the results of operations and financial position. Earnings Per Share Basic earnings per share are computed by dividing net earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share reflect the potential dilution that could occur if stock options and other dilutive securities were exercised. Dilutive securities are excluded from the computation of the diluted income per share in periods when their effect is anti-dilutive. The Company’s dilutive securities consist of employee stock options and restricted stock units. The effect of dilutive securities including employee stock options and restricted stock units were 1,534 thousand shares (384 thousand ADSs), 1,131 thousand shares (283 thousand ADSs) and 868 thousand shares (218 thousand ADSs) for the years ended December 31, 2015, 2016 and 2017, respectively. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718 Compensation — Stock Compensation. The Company uses the Black-Scholes valuation model for the valuation of stock options and recognizes compensation expense on a straight-line basis over the requisite service period of the award. The value of our restricted stock units is based on the fair value of our shares on the date of grant and expensed over the vesting period. Prior to the initial declaration of a quarterly cash dividend on January 22, 2013, the fair value of restricted stock units (“RSUs”) was measured based on the grant date share price, as the Company did not historically pay cash dividends on our common stock. For awards granted on or subsequent to January 22, 2013, the fair value of RSUs was measured based on the grant date share price, less the present value of expected dividends during the vesting period, discounted at a risk-free interest rate. Dividends Our Board of Directors declared payment of our first quarterly dividend on our common stock in January 2013 and the first dividend payment was made on March 4, 2013. Our Board of Directors has subsequently declared and paid dividends in each successive quarter. On October 24, 2016 and October 24, 2017, our Board of Directors, instead of declaring a quarterly dividend, declared an annual dividend payable in four quarterly installments. The payment of future cash dividends are subject to the Board’s continuing determination that the payment of dividends are in the best interests of the Company’s shareholders and are in compliance with all laws and agreements of the Company applicable to the declaration and payment of cash dividends. Recent Accounting Pronouncements In May 2014, the FASB issued a new standard related to revenue recognition. Under the new standard, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB issued an amendment to defer the effective date. The new standard is effective for fiscal years beginning after December 15, 2017 and early adoption is permitted for annual reporting periods beginning after December 15, 2016. In March and April 2016, the FASB issued two accounting updates to clarify the implementation guidance on principal versus agent considerations, performance obligations and the licensing. In addition, the FASB issued another accounting update in May 2016 to address narrow-scope improvements to the guidance on collectability, noncash consideration, and completed contracts at transition and provides a practical expedient for contract modifications at transition. The new guidance is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application. The Company will adopt this new standard as of January 1, 2018, using the modified retrospective method with the cumulative effect of initially applying it recognized at the date of initial application. The Company has finalized its assessment and has identified that the adoption of this new standard will not have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In April 2015, the FASB issued an accounting update regarding the measurement date of a defined benefit obligation and plan assets. The amendment permits the entity with a fiscal year-end month-end month-end year-end. month-end year-end, In July 2015, the FASB issued an accounting update to simplify the measurement of inventory. The amendment requires the measurement of inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The amendment applies to inventories for which cost is determined by methods other than the last-in first-out In November 2015, the FASB issued an accounting update to simplify the presentation of deferred income taxes. The amendment requires that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying In February 2016, the FASB issued a new standard regarding leases (Topic 842). The new standard requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases other than that the entity elects the short-term lease recognition and measurement exemption. Qualitative and quantitative disclosures will be enhanced to better understand the amount, timing and uncertainty of cash flows arising from leases. In January 2018, the FASB issued an amendment that permits an entity to elect an optional transition practical expedient to not evaluate under Topic 842 land easements that exist or expired before the entity’s adoption of Topic 842 and that were not previously accounted for as leases under Topic 840, the current standard regarding leases. The guidance is effective for fiscal years beginning after December 15, 2018, and early adoption is permitted. The Company is currently evaluating the effect this standard will have on its financial position, results of operations, cash flow and financial statement disclosures. In March 2016, the FASB issued an accounting update to simplify several aspects of the accounting for share-based payment award transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The amendment is effective for fiscal years beginning after December 15, 2016, and earlier adoption is permitted. The adoption of this amendment did not have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In June 2016, the FASB issued an accounting update to amend the guidance on the impairment of financial instruments that are not measured at fair value through profit and loss. The amendment introduces a current expected credit loss (CECL) model based on expected losses rather than incurred losses to estimate credit losses on financial instruments measured at amortized cost and requires a broader range of reasonable and supportable information to estimate expected credit loss. In addition, under the amendment, an entity recognizes an allowance for expected credit losses on financial instruments measured at amortized cost and available-for-sale In August 2016, the FASB issued an accounting update to clarify the following eight cash flow classification issues: (1) debt prepayment or debt extinguishment costs, (2) settlement of zero-coupon In October 2016, the FASB issued an accounting update to simplify the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. The amendment removes the prohibition against the recognition of current and deferred income tax effects of intra-entity transfers of assets other than inventory until the asset has been sold to an outside party. The amendment is effective for fiscal years beginning after December 15, 2017, and earlier adoption is permitted. The adoption of this amendment is not expected to have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In October 2016, the FASB issued an accounting update to amend the consolidation guidance on how a reporting entity that is the single decision maker of a variable interest entity (“VIE”) should treat indirect interests in the entity held through related parties that are under common control with the reporting entity when determining whether it is the primary beneficiary of that VIE. Under this amendment, the single decision maker is required to consider that indirect economic interests in the VIE held through related parties that are under common control on a proportionate basis. However, this amendment does not change the existing characteristics of a primary beneficiary. The amendment is effective for fiscal years beginning after December 15, 2016, and earlier adoption is permitted. The adoption of this amendment did not have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In November 2016, the FASB issued an accounting update related to the classification and presentation of changes in restricted cash on the statement of cash flows. The amendment requires restricted cash or restricted cash equivalents should be included with cash and cash equivalent when reconciling the beginning-of-period end-of-period The following table reflects the adjustments made to the consolidated statements of cash flows to confirm prior period classifications under the new guidance for the periods presented: As Reported Adjustment As Adjusted US$ US$ US$ Year Ended December 31, 2014: Net cash provided by operating activities 68,725 — 68,725 Net cash provided by (used in) investing activities (15,413 ) 3,817 (11,596 ) Net cash used in financing activities (19,710 ) — (19,710 ) Net increase (decrease) in cash, cash equivalents, and restricted cash* 33,602 3,817 37,419 Effect of exchange rate changes (1,111 ) — (1,111 ) Cash, cash equivalents, and restricted cash* at beginning of year 161,720 17,864 179,584 Cash, cash equivalents, and restricted cash* at end of year 194,211 21,681 215,892 Year Ended December 31, 2015: Net cash provided by operating activities 65,946 — 65,946 Net cash used in investing activities (58,414 ) (44 ) (58,458 ) Net cash used in financing activities (20,271 ) — (20,271 ) Net increase (decrease) in cash, cash equivalents, and restricted cash* (12,739 ) (44 ) (12,783 ) Effect of exchange rate changes (953 ) — (953 ) Cash, cash equivalents, and restricted cash* at beginning of year 194,211 21,681 215,892 Cash, cash equivalents, and restricted cash* at end of year 180,519 21,637 202,156 * The restricted cash is only included in the amount of “as adjusted” item. To early adopt the accounting update, the Company has amended the presentation of changes in cash and cash equivalents by explaining the changes in the total of cash, cash equivalents, and restricted cash. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the statement of cash flows. As of December 31 2014 2015 2016 2017 US$ US$ US$ US$ Cash and cash equivalents 194,211 180,519 274,483 359,453 Restricted cash included in restricted assets-current 19,322 19,328 44,393 19,515 Restricted cash included in other assets 2,359 2,309 2,301 2,555 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows 215,892 202,156 321,177 381,523 Amounts included in restricted cash represent (a) cash and time deposits set aside as collateral for obtaining capacity; (b) cash received from government grants with restriction on its usage; and (c) cash and time deposits that are pledged for short-term loans. In January 2017, the FASB issued an accounting update to clarify the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendment provides a screen to determine when an integrated set of assets and activities (collectively referred to as a “set”) is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is n |
Business Acquisition
Business Acquisition | 12 Months Ended |
Dec. 31, 2017 | |
Business Acquisition | 3. BUSINESS ACQUISITION Shannon On July 1, 2015, the Company completed its acquisition of Shannon Systems, China’s leading enterprise-class PCIe SSD company based in Shanghai, China. In exchange for 100% of the outstanding shares of common stock of Shannon Systems, the Company issued 1,560 thousand ordinary shares with fair value of US$7,640 thousand and paid approximately US$37,925 thousand in cash. The value of the 1,560 thousand ordinary shares issued was determined based on the market value of the Company’s common shares at the date of the acquisition, discounted for the fact that the shares are restricted as to their marketability for a period of five years from the issuance date. In 2015, the Company incurred US$359 thousand of acquisition costs which comprised primarily of transaction fees and direct acquisition costs, including legal, accounting, and other professional fees. These costs are included in the line item of “operating expenses—general and administrative” on the consolidated statements of income. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition: US$ Cash, cash equivalents and restricted cash 1,904 Accounts receivable, net 946 Inventories 2,624 Other current assets 288 Property and equipment 71 Goodwill 33,204 Identifiable intangible assets 8,381 Accounts payable (644 ) Accrued expenses and other current liabilities (1,209 ) Net assets acquired 45,565 As of December 31, 2017, approximately US$5,735 thousand has not been paid to the former shareholders of Shannon Systems and is included in other long-term liabilities on the consolidated balance sheets as of both December 31, 2016 and 2017. The excess of the purchase price over the fair value of the net tangible assets acquired has been reflected as identifiable intangible assets. The identifiable intangible assets and respective useful lives are as follows: US$ Useful Life Developed technology 3,789 3.5 In-process 4,592 indefinite Total identifiable intangible assets 8,381 Developed technology represented the existing know-how in-process The estimated fair value of IPR&D was defined as research and development projects related to enterprise-class PCIe SSDs in-process Goodwill represents the excess of the purchase price over the estimated fair values of the net tangible and intangible assets. The factors that contributed to the recognition of goodwill primarily relate to expansion into new product areas and potential synergies created from combined capabilities, and goodwill is not expected to be deductible for tax purposes. The results of Shannon Systems since the acquisition date included on the consolidated statement of income for the year ended December 31, 2015 were as follows: US$ Net sales 9,049 Net income 421 The operating results of Shannon Systems have been included in the Company’s operations beginning July 1, 2015. The following unaudited pro forma information represents a summary of the results of operations as if the acquisition occurred on January 1, 2014 and 2015 and includes certain pro forma adjustments, including amortization of identifiable intangibles from that date (in thousands except earnings per share): Year Ended December 31 2014 2015 Net sales 293,562 364,670 Net income 42,483 58,468 Earnings per share Basic 0.31 0.42 Diluted 0.31 0.42 Weighted average ordinary shares outstanding (thousand) Basic 136,164 138,880 Diluted 138,347 140,414 The pro forma results are based on various assumptions and are not necessarily indicative of what would have occurred had the acquisition closed on January 1, 2014 and 2015. Bigtera On July 3, 2017, the Company completed its acquisition of Bigtera, a software defined storage company. In exchange for 100% of the outstanding shares of common stock of Bigtera, the Company paid approximately US$4,664 thousand in cash. In 2017, the Company incurred US$171 thousand of acquisition costs which comprised primarily of transaction fees and direct acquisition costs, including legal and other professional fees. These costs are included in the line item of “operating expenses—general and administrative” on the consolidated statements of income. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition: US$ Cash, cash equivalents and restricted cash 78 Accounts receivable, net 380 Other current assets 14 Property and equipment 15 Goodwill 625 Identifiable intangible assets 4,736 Accounts payable (436 ) Accrued expenses and other current liabilities (748 ) Net assets acquired 4,664 As of December 31, 2017, approximately US$1,721 thousand has not been paid to the former shareholders of Bigtera and is included in other current and long-term liabilities on the consolidated balance sheets as of December 31, 2017. The excess of the purchase price over the fair value of the net tangible assets acquired has been reflected as identifiable intangible assets. The identifiable intangible assets and respective useful lives are as follows: US$ Useful Life Know-how 3,753 5.5 Current technology 983 5.5 Total identifiable intangible assets 4,736 Know-how know-how Current technology represents the part of technology that is unique in current version of software products. Goodwill represents the excess of the purchase price over the estimated fair values of the net tangible and intangible assets. The factors that contributed to the recognition of goodwill primarily relate to expansion into new product areas and potential synergies created from combined capabilities, and goodwill is not expected to be deductible for tax purposes. The results of Bigtera since the acquisition date included on the consolidated statement of income for the year ended December 31, 2017 were as follows: US$ Net sales 2,993 Net income (314 ) The operating results of Bigtera have been included in the Company’s operations beginning July 3, 2017. The following unaudited pro forma information represents a summary of the results of operations as if the acquisition occurred on January 1, 2016 and 2017 and includes certain pro forma adjustments, including amortization of identifiable intangibles from that date (in thousands except earnings per share): Year Ended December 31 2016 2017 Net sales 557,672 523,849 Net income 109,736 73,834 Earnings per share Basic 0.78 0.52 Diluted 0.77 0.51 Weighted average ordinary shares outstanding (thousand) Basic 140,919 142,738 Diluted 142,050 143,606 The pro forma results are based on various assumptions and are not necessarily indicative of what would have occurred had the acquisition closed on January 1, 2016 and 2017. |
Cash, Cash Equivalents, and Res
Cash, Cash Equivalents, and Restricted Cash | 12 Months Ended |
Dec. 31, 2017 | |
Cash, Cash Equivalents, and Restricted Cash | 4. CASH, CASH EQUIVALENTS, AND RESTRICTED CASH December 31 2016 2017 US$ US$ Cash and deposits in bank 58,391 59,751 Time deposits 199,064 269,392 Bonds acquired under repurchase agreements 17,028 30,310 Total cash and cash equivalents 274,483 359,453 Restricted cash (Note 2) 46,694 22,070 321,177 381,523 |
Short-Term Investments
Short-Term Investments | 12 Months Ended |
Dec. 31, 2017 | |
Short-Term Investments | 5. SHORT-TERM INVESTMENTS December 31 2016 2017 US$ US$ Trading securities 3,302 6,941 The Company classified certain short-term investments as trading securities. Realized gains on sales of these trading securities were US$3 thousand, US$2 thousand and US$103 thousand for the years ended December 31, 2015, 2016 and 2017, respectively. The amount of unrealized losses related to trading securities at year end was nil for the years ended December 31, 2015, 2016 and 2017, respectively. |
Notes and Accounts Receivable
Notes and Accounts Receivable | 12 Months Ended |
Dec. 31, 2017 | |
Notes and Accounts Receivable | 6. NOTES AND ACCOUNTS RECEIVABLE December 31 2016 2017 US$ US$ Trade accounts receivable 75,946 81,165 Allowance for doubtful accounts (723 ) (598 ) Allowance for sales returns and discounts (1,624 ) (1,432 ) 73,599 79,135 The changes in the allowances are summarized as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Allowances for doubtful accounts Balance, beginning of year 1,167 775 723 Reversals charged to expense, net (392 ) (12 ) (125 ) Write-offs — (40 ) — Balance, end of year 775 723 598 Year Ended December 31 2015 2016 2017 US$ US$ US$ Allowances for sales returns and discounts Balance, beginning of year 1,427 1,555 1,624 Additions charged to expense, net 1,753 3,285 3,093 Actual sales return and discount (1,625 ) (3,216 ) (3,285 ) Balance, end of year 1,555 1,624 1,432 |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2017 | |
Inventories | 7. INVENTORIES The components of inventories are as follows: December 31 2016 2017 US$ US$ Finished goods 24,782 41,365 Work in process 31,185 25,090 Raw materials 15,920 27,731 71,887 94,186 The Company wrote down US$2,525 thousand, US$2,995 thousand and US$698 thousand in 2015, 2016 and 2017, respectively, for estimated obsolete or unmarketable inventory. |
Long-Term Investments
Long-Term Investments | 12 Months Ended |
Dec. 31, 2017 | |
Long-Term Investments | 8. LONG-TERM INVESTMENTS As of December 31, 2016 and 2017, the Company held equity investments in several privately-held companies with the carrying value as follows: Percentage December 31 2016 2017 2016 2017 US$ US$ Cost method: Cashido Corp. (Cashido) 2.1 % 2.1 % 91 — Vastview Technology, Corp. (Vastview) 2.9 % 2.9 % 29 — 120 — In July 2001, the Company invested in the common stock of Cashido. At the time of investment, Cashido manufactured flash memory storage devices. Cashido currently focuses on the manufacture of computer accessories and ozone based sterilization devices. In 2016 and 2017, the Company recognized impairment charges of US$13 thousand and US$91 thousand in its investment in Cashido, respectively. In December 2006 and February 2007, the Company invested US$3,360 thousand in the common stock of Vastview. Vastview is a fabless semiconductor company that develops and markets driver ICs and other ICs for the TFT-LCD The Company accounts for these investments using the cost method. These investments are evaluated for impairment on an annual basis or as circumstances warrant. |
Noncurrent Assets Held for Sale
Noncurrent Assets Held for Sale | 12 Months Ended |
Dec. 31, 2017 | |
Noncurrent Assets Held for Sale | 9. NONCURRENT ASSETS HELD FOR SALE December 31 2016 2017 US$ US$ Assets held for sale 3,363 — 3,363 — The Company vacated from an office building located in Shanghai, China and in 2016 took action to sell the property. The sale plan met all of the held-for-sale criteria in accordance with ASC 360—Property, Plant and Equipment and the asset was reclassified accordingly. In 2017, the Company sold the property to a non-affiliated |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property and Equipment | 10. PROPERTY AND EQUIPMENT December 31 2016 2017 US$ US$ Cost: Land 9,309 9,309 Buildings 29,232 30,288 Machinery and equipment 18,122 21,665 Furniture and fixtures 6,760 7,746 Leasehold and buildings improvement 4,911 5,497 Software 22,745 24,864 Total 91,079 99,369 Accumulated depreciation: Buildings 2,708 3,472 Machinery and equipment 14,032 15,665 Furniture and fixtures 4,207 5,212 Leasehold and buildings improvement 3,591 4,213 Software 19,130 19,874 43,668 48,436 Prepayment and construction in progress 481 437 47,892 51,370 In April 2006, the Company began leasing a property located in Taipei, Taiwan to a third party. The lessee has been renewing the operating lease annually and last renewed in March 2018. Net carrying value of the properties as of December 31, 2016 and 2017 was US$728 thousand and US$709 thousand, respectively. Annual rental income from the lease is about US$42 thousand each year. |
Goodwill and Acquired Intangibl
Goodwill and Acquired Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Acquired Intangible Assets | 11. GOODWILL AND ACQUIRED INTANGIBLE ASSETS Intangible assets: December 31 2016 2017 US$ US$ Cost Accumulated Accumulated Net Cost Accumulated Accumulated Net Acquisition-related intangible assets 8,381 — (3,154 ) 5,227 13,117 — (5,688 ) 7,429 No impairment losses were recognized in 2015, 2016 and 2017. Amortization expense of acquisition-related intangible assets for the years ended December 31, 2015, 2016 and 2017 were US$1,051 thousand, US$2,103 thousand and US$2,534 thousand, respectively. Goodwill: 2017-04 one-step December 31 2016 2017 US$ US$ Cost Accumulated Foreign Net Cost Accumulated Foreign Net Goodwill 99,504 (30,808 ) (40 ) 68,656 100,129 (41,145 ) (20 ) 58,964 |
Short-Term Bank Loans
Short-Term Bank Loans | 12 Months Ended |
Dec. 31, 2017 | |
Short-Term Bank Loans | 12. SHORT-TERM BANK LOANS December 31 2016 2017 US$ US$ Secured loans 25,000 25,000 25,000 25,000 The interest expenses for the years ended December 31, 2015, 2016 and 2017 were nil, US$105 and US$387 thousand, respectively. In 2016 and 2017, the Company obtained US dollar revolver credit facilities from two banks and drew down US$25,000 thousand in 2016 and 2017, respectively. Interest rates ranged from 0.953% to 1.51% per annum on monthly outstanding loans. In 2016, loans were secured by US$25 million of pledged deposits, which were recorded as current restricted cash, and in 2017, loans no longer required pledged deposits. The US$25 million of loans is expected to be repaid in 2018. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Expenses and Other Current Liabilities | 13. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES December 31 2016 2017 US$ US$ Wages and bonus 29,028 29,629 Dividends 21,382 32,451 Research and development payable 5,456 5,638 License fees and royalties 4,021 3,729 Professional fees 2,038 2,286 Equipment 492 1,844 Others 6,319 8,186 68,736 83,763 |
Pension Plan
Pension Plan | 12 Months Ended |
Dec. 31, 2017 | |
Pension Plan | 14. PENSION PLAN SMI Taiwan, the Company’s largest operating company is a Taiwan registered company and subject to Taiwan’s Labor Pension Act (the “Act”), which became effective on July 1, 2005, and the pension mechanism under the Act is deemed a defined contribution plan. The employees who were subject to the Labor Standards Law prior to July 1, 2005 could choose to be subject to the pension mechanism under the Act or continue to be subject to the pension mechanism under the Labor Standards Law. For those employees who were subject to the Labor Standards Law prior to July 1, 2005 and still work for the same company after July 1, 2005 and have chosen to be subject to the pension mechanism under the Act, their seniority as of July 1, 2005 were maintained. The Act prescribes that the rate of contribution by an employer to employees’ pension accounts per month will not be less than 6% of each employee’s monthly salary. According to the Act, SMI Taiwan made monthly contributions and recognized pension costs of US$1,015 thousand, US$1,272 thousand and US$1,579 thousand for the years ended December 31, 2015, 2016 and 2017, respectively. The Company provides a defined benefit plan to the employees of SMI Taiwan under the Labor Standards Law that offers benefits based on an employee’s length of service and average monthly salary for the six-month two-year Starting in 2010, the Company provides a defined benefit pension plan to the Korean employees of FCI with at least one year of service. FCI’s overall investment strategy is to avoid a negative return on plan assets. FCI estimates its contribution for the year ending December 31, 2018 to be nil. For employees under defined contribution pension plans, pension costs are recorded based on the actual contributions made to employees’ individual pension accounts. For employees under defined benefit pension plans, pension costs are recorded based on actuarial calculations. Determining the cost associated with such benefits is dependent on various actuarial assumptions, including discount rate, expected return on plan assets, compensation increase, employee mortality and turnover rates. The Company reviewed its actuarial assumptions at the measurement date on December 31 every year. The effect of modifications to assumptions is recorded in accumulated other comprehensive loss and amortized to net periodic cost over future periods using the corridor method. The Company believes that assumptions utilized in recording its obligations under its plans are reasonable based on its experience and market conditions. Independent actuaries perform the required calculations to determine expense in accordance with U.S. GAAP. Actual results may differ from the actuarial assumptions and are generally accumulated and amortized into earnings over future periods. The net periodic costs are recognized as employees render services necessary to earn the benefits. The changes in benefits obligation and plan assets and the reconciliation of funded status are as follows: December 31 2015 2016 2017 US$ US$ US$ Change in benefit obligation Projected benefit obligation at beginning of year 3,320 3,632 4,242 Service cost 273 487 1,572 Interest cost 57 104 336 Actuarial loss (gain) 79 151 (665 ) Benefits paid (97 ) (132 ) (354 ) Projected benefit obligation at end of year 3,632 4,242 5,131 Change in plan assets Fair value of plan assets at beginning of year 2,556 2,800 3,902 Actual return on plan assets 33 33 81 Employer contributions 328 1,203 1,358 Benefits paid (117 ) (134 ) (227 ) Fair value of plan assets at end of year 2,800 3,902 5,114 Funded status recognized as an other asset (liabilities) (832 ) (340 ) (17 ) Amounts recognized in accumulated other comprehensive income consist of the following: Year Ended December 31 2015 2016 2017 US$ US$ US$ Net loss 852 963 678 Transition obligation 1 — — Total recognized in accumulated other comprehensive income 853 963 678 The accumulated benefit obligation for all defined benefit pension plans was US$2,098 thousand, US$2,648 thousand and US$ 3,210 thousand at December 31, 2015, 2016 and 2017, respectively. The components of net periodic benefit cost are as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Service cost 273 487 1,572 Interest cost 57 104 336 Projected return on plan assets (47 ) (28 ) (58 ) Amortization of unrecognized net transition obligation and unrecognized net actuarial gain 27 11 37 Net periodic benefit cost 310 574 1,887 Other changes in plan assets and benefit obligation recognized in other comprehensive loss: 2015 2016 2017 US$ US$ US$ Recognize the decrease in net gain (loss) 4 111 (285 ) Amortization of net gain (loss) — (1 ) — Total recognized in other comprehensive loss (income) 4 110 (285 ) The estimated net gain for the defined benefit pension plans that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year is US$33 thousand. Expected benefit payments: US$ 2018 188 2019 184 2020 407 2021 181 2022 182 2023 and thereafter 2,057 The actuarial assumptions to determine the benefit obligations were as follows: 2015 2016 2017 Taiwan Korea Taiwan Korea Taiwan Korea Weighted-average assumptions used to determine benefit obligations: Discount rate 1.75 % 3.90 % 1.50 % 3.80 % 1.63 % 4.10 % Rate of compensation increase 4.25 % 4.00 % 4.25 % 3.50 % 4.25 % 3.50 % Weighted-average assumptions used to determine net projected benefit cost: Discount rate 1.75 % 3.90 % 1.50 % 3.80 % 1.63 % 4.10 % Expected long-term return on plan assets 2.00 % 1.20 % 2.00 % 1.10 % 1.75 % 1.10 % Rate of compensation increase 4.25 % 4.00 % 4.25 % 3.50 % 4.25 % 3.50 % In 2016 and 2017, FCI’s pension plan assets were invested in principal guaranteed interest insurance contracts and fixed bank deposits, which are principal and interest guaranteed products and are classified as Level 2. These Level 2 securities were valued by discounting future cash flows using benchmark yield rates. The fair values of FCI’s pension plan assets at December 31, 2016 and 2017 are as follows: December 31 2016 2017 US$ US$ Guaranteed interest contract Kyobo Life Insurance Co. Ltd. 1,284 1,599 Shinhan Investment Co. . — 374 Fixed deposit Industrial Bank of Korea 1,537 1,892 2,821 3,865 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Taxes | 15. INCOME TAXES The components of income tax expense are as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Current 17,338 31,063 23,465 Deferred 911 (3,373 ) 581 Income tax expense 18,249 27,690 24,046 The income (loss) before income taxes for domestic and foreign entities is as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Domestic (12,037 ) (20,663 ) (27,902 ) Foreign 90,537 159,293 126,903 78,500 138,630 99,001 Since the Company is based in the Cayman Islands, a British overseas territory with no corporate income tax, tax on pretax income is calculated at the Cayman Islands statutory rate of zero for each year. The Company and its subsidiaries file separate income tax returns. A reconciliation of income tax expense on pretax income at statutory rate and income tax expense is shown below: Year Ended December 31 2015 2016 2017 US$ US$ US$ Tax expense at statutory rate of Cayman — — — Differences between Cayman and foreign statutory tax rates 18,765 34,415 24,255 Tax-exempt (906 ) (4,648 ) — Permanent differences (1,065 ) (7,792 ) (4,249 ) Temporary differences (330 ) (1,533 ) (1,445 ) Alternative minimum tax 4 594 4 Income tax (10%) on undistributed earnings 2,460 5,677 2,709 Net changes in income tax credit (897 ) (495 ) 166 Net changes in valuation allowance of deferred income tax assets 1,621 1,724 (2,401 ) Net operating loss carryforwards (2,052 ) (1,689 ) 1,492 Liabilities related to unrealized tax benefits 672 2,385 3,455 Adjustment of prior years’ taxes and others (23 ) (948 ) 60 Income tax expense 18,249 27,690 24,046 Deferred income tax assets (liabilities) are as follows: December 31 2016 2017 US$ US$ Notes and accounts receivable 44 44 Stock-based compensation 1,146 771 Allowance for sales return 205 154 Inventory reserve 1,646 1,311 Foreign currency translation 2 ( 5 ) Property and equipment 383 168 Investment tax credits 8,647 9,078 Net operating loss carryforwards 12,335 10,391 Others 411 562 Valuation allowance (20,836 ) (19,072 ) 3,983 3,402 The valuation allowance shown in the table above relates to net operating loss carryforwards, tax credits and temporary differences for which the Company believes that realization is uncertain. Valuation allowance increased by US$2,253 thousand and US$1,792 thousand for the years ended December 31, 2015 and 2016, respectively, and decreased by US$1,764 thousand for the year ended December 31, 2017. The increase in valuation allowance in 2015, and 2016 was primarily due to uncertainty in generating sufficient taxable income in the foreseeable future and utilizing operating loss carryforwards and research and development credits before they expire. The decrease in valuation allowance in 2017 was primarily due to the lower Federal corporate income tax rate that followed the enactment of the Tax Cuts and Jobs Act of 2017. Starting from 2018, the corporate income tax rate in Taiwan increased from 17% to 20%. In addition, the rate of the corporate surtax applicable to 2018 unappropriated earnings was reduced from 10% to 5%. Deferred tax assets recognized as at December 31, 2017 are expected to be adjusted and would increase by US$529 thousand in 2018. As of December 31, 2017, FCI had unused research and development tax credits of approximately US$4,546 thousand which will expire in the period from 2018 to 2022. As of December 31, 2017, the Company’s United States federal net operating loss carryforwards for federal income tax purposes were approximately US$9,760 thousand. If not utilized, the federal net operating loss carryforwards will expire in 2037. As of December 31, 2017, the Company’s United States federal and state research and development tax credit carryforwards for federal and state income tax purposes were approximately US$2,601 thousand and US$1,785 thousand, respectively. If not utilized, the federal tax credit carryforwards will expire starting in 2037 while the state tax credit carryforward has no expiration date. Current United States federal and California state laws include substantial restrictions on the utilization of net operating losses and credits in the event of an “ownership change” of a corporation. Accordingly, the Company’s ability to utilize net operating loss and tax credit carryforwards may be limited as a result of such “ownership change”. Such a limitation could result in the expiration of carryforwards before they are utilized. As of December 31, 2017, the Company had accumulated undistributed earnings from a foreign subsidiary of US$325 million. No deferred tax liability was recorded in respect of those amounts as these earnings are considered indefinitely reinvested. It is not practicable to estimate the amount of unrecognized deferred tax liabilities for these undistributed foreign earnings. Unrecognized Tax Benefit A reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits is as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Balance, beginning of year 4,655 5,639 10,286 Increases in tax positions taken in current year 2,337 4,675 6,647 Decrease in tax position taken in prior year primarily related to the resolution of tax audit (1,353 ) (28 ) (1,877 ) Balance, end of year 5,639 10,286 15,056 At December 31, 2017, the Company had US$15,056 thousand of unrecognized tax benefits that if recognized would affect the effective tax rate. For the years ended December 31, 2015, 2016 and 2017, the total amount of interest expense and penalties related to uncertain tax positions recorded in the provision for income tax expense was approximately US$363 thousand, US$575 thousand and US$617 thousand, respectively. The total amount of accrued interest and penalties recognized as of December 31, 2016 and 2017 was US$2,587 thousand and US$3,421 thousand, respectively. The Company does not expect uncertain tax positions to change in the next twelve months, except in the case of settlements with tax authorities, the likelihood and timing of which are difficult to estimate. The Company files income tax returns in United States and foreign jurisdictions. The following table summarizes the Company’s major jurisdictions and tax year that remain subject to examination by tax authorities as of December 31, 2017: Tax Jurisdiction Tax Years China 2014 and onward Hong Kong 2014 and onward Taiwan 2012 and onward Korea 2012 and onward United States 2012 onward |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2017 | |
Shareholders' Equity | 16. SHAREHOLDERS’ EQUITY Appropriations from Earnings In accordance with the amendments to the Company Act of the ROC in May 2015, the recipients of dividends and bonuses are limited to shareholders and do not include employees. The board of directors of SMI Taiwan held their meeting on June 29, 2016 and, in that meeting, had resolved amendments to the Company’s Articles of Incorporation of SMI Taiwan, particularly the amendment to the policy on dividend distribution and the addition of the policy on distribution of employees’ compensation. Under the dividend policy of SMI Taiwan as set forth in the amended Articles, SMI Taiwan, the Company’s largest subsidiary, must make appropriations from annual earnings to non-distributable year-end a. Payment of taxes; b. Recovery of prior years’ deficits, if any; c. 10% of remaining balance after deduction for a and b as legal reserve; d. Special reserve based on relevant laws or regulations or 10% of remaining balance for deduction from above a to c as special reserve when necessary. Dividends The Company declared cash dividends per ordinary share during the periods presented as follows: 2016 2017 Dividends Amount Dividends Amount First quarter $ 0.0375 $ 5,290 $ 0.050 $ 7,134 Second quarter $ 0.0375 5,290 $ 0.050 7,148 Third quarter $ 0.0375 5,297 $ 0.050 7,155 Fourth quarter $ 0.0500 7,065 $ 0.075 10,737 $ 22,942 $ 32,174 On October 24, 2016 and October 24, 2017, our Board of Directors, instead of declaring a quarterly dividend, declared an annual dividend of US$0.8 and US$1.2 per ADS, equivalent to US$0.2 and US$0.3 per ordinary share, which will be paid in four quarterly installments starting in the fourth quarter of 2016 and 2017, respectively. Future dividends, if any, on the Company’s outstanding ADSs and ordinary shares will be declared by and subject to the discretion of the Company’s board of directors. If the Company’s board of directors decides to distribute dividends, the form, frequency and amount of such dividends will depend upon the Company’s future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors our board of directors may deem relevant. Any future dividend the Company declares will be paid to the holders of ADSs, subject to the terms of the deposit agreement, to the same extent as holders of the Company’s ordinary shares, to the extent permitted by applicable laws and regulations, less the fees and expenses payable under the deposit agreement. Any dividend the Company declares will be distributed by the depositary bank to the holders of our ADSs. Cash dividends on our ordinary shares, if any, will be paid in U.S. dollars. |
Equity Incentive Plan
Equity Incentive Plan | 12 Months Ended |
Dec. 31, 2017 | |
Equity Incentive Plan | 17. EQUITY INCENTIVE PLAN 2005 Equity Incentive Plan and 2015 Equity Incentive Plan On April 22, 2005, the Company adopted its 2005 Equity Incentive Plan (“the 2005 Plan”). The 2005 Plan provides for the grant of stock options, stock bonuses, restricted stock awards, restricted stock units and stock appreciation rights, which may be granted to employees (including officers), directors and consultants. The 2005 Plan reserved 10,000 thousand shares of ordinary shares, inclusive of the number of assumed share options under the 2004 Plan, for issuance upon the exercise of stock options. In 2006, the Company amended the 2005 Plan to reserve an additional 15,000 thousand ordinary shares for issuance upon exercise of stock options and restricted stock units. In 2009, the Company amended the Plan to reserve an additional 15,000 thousand ordinary shares for issuance upon exercise of stock options and restricted stock units. Restricted stock units are converted into shares of the Company’s ordinary shares upon vesting on one-for-one non-vested In April 2010, the Company’s Board of Directors and Compensation Committee approved an employee stock option exchange program that required certain employees to exchange eligible stock options for a lesser number of new stock options that have approximately the same fair values as the options surrendered. Eligible options included stock options granted between August 17, 2005 and July 31, 2008 that had an exercised price above US$1.85. In 2010, 4,369 thousand eligible stock options were exchanged for 3,785 thousand new stock options granted. The new stock options have an exercise price of US$1.47, which was equal to the market price of the Company’s ordinary share on April 26, 2010, the date eligible stock options were surrendered and new stock options granted. The new stock options were issued under the 2005 Plan and are subject to its terms and conditions. The new stock options will continue to vest according to the original vesting schedule. Using the Black-Scholes option pricing model, the Company determined that the fair value of the surrendered stock options on a grant-by-grant On June 3, 2015, the Company adopted its 2015 Equity Incentive Plan (“the 2015 Plan”). The 2015 Plan provides for the grant of stock options, stock bonuses, restricted stock awards, restricted stock units and stock appreciation rights, which may be granted to employees (including officers), directors and consultants. The 2015 Plan reserved 20,000 thousand shares of ordinary shares for issuance upon exercise of stock options and restricted stock units. Stock Option and Restricted Stock Units Activity The following is a summary of, the 2005 Plan and the 2015 Plan, which includes stock options and restricted stock units: Unit Available for grant at January 1, 2015 1,687 Authorized 20,000 Restricted stock units granted (2,000 ) Option and restricted stock units forfeited 175 Available for grant at December 31, 2015 19,862 Restricted stock units granted (1,446 ) Option and restricted stock units forfeited 335 Available for grant at December 31, 2016 18,751 Restricted stock units granted (1,391 ) Option and restricted stock units forfeited 27 Available for grant at December 31, 2017 17,387 Stock Options A summary of the stock option activity and related information is as follows: Number of Weighted Weighted Outstanding at January 1, 2015 1,058 1.47 Options forfeited (143 ) 1.47 Options exercised (336 ) 1.47 Outstanding at December 31, 2015 579 1.47 0.92 Options vested and expected to vest after December 31, 2015 579 1.47 0.92 Options forfeited (257 ) 1.47 Options exercised (64 ) 1.47 Outstanding at December 31, 2016 258 1.47 0.25 Options vested and expected to vest after December 31, 2016 258 1.47 0.25 Options exercised (258 ) 1.47 Outstanding at December 31, 2017 — — — No stock options were granted in 2015, 2016 and 2017. The intrinsic value of options exercised, determined as of the date of option exercise, was US$3,688 thousand, US$580 thousand and US$3,040 thousand in 2015, 2016 and 2017, respectively. As of December 31, 2017, total unrecognized compensation cost related to non-vested The aggregate intrinsic value represents the total intrinsic value (the difference between the Company’s closing stock price on the last trading day of fiscal year 2017 and the exercise price, multiplied by the number of in-the-money The total cash received from employees as a result of employee stock option exercises were US$494 thousand, US$93 thousand and US$380 thousand for the years ended December 31, 2015, 2016 and 2017, respectively. The related tax effect for stock-based compensation benefit were US$561 thousand, US$37 thousand, and US$124 thousand for 2015, 2016 and 2017, respectively. The related tax effect for stock-based compensation expense for option and restricted stock units exercised during 2015, 2016 and 2017 was US$1,647 thousand, US$1,702 thousand and US$2,273 thousand, respectively. The related tax effect was determined using the applicable tax rates in jurisdictions to which this expense relates. Restricted Stock Units A summary of the status of restricted stock units and changes is as follows: Number of Non-vested Weighted Weight Non-vested 2,160 4.90 0.31 Restricted stock units granted 2,000 6.83 Restricted stock units vested (2,003 ) 4.96 Restricted stock units forfeited (32 ) 5.85 Non-vested 2,125 6.65 0.73 Restricted stock units granted 1,446 12.67 Restricted stock units vested (1,726 ) 6.46 Restricted stock units forfeited (78 ) 6.57 Non-vested 1,767 11.65 0.47 Restricted stock units granted 1,391 10.75 Restricted stock units vested (1,593 ) 12.08 Restricted stock units forfeited (27 ) 10.69 Non-vested 1,538 10.36 0.33 As of December 31, 2017, there was US$4,736 thousand of total unrecognized compensation cost related to restricted stock units granted under the 2005 Plan and the 2015 Plan. Stock-based Compensation Expense The following table shows total stock-based compensation expense included in the Consolidated Statements of Income for the years ended December 31, 2015, 2016 and 2017. Year Ended December 31 2015 2016 2017 US$ US$ US$ Cost of sales 261 400 293 Research and development 6,565 10,529 9,255 Sales and marketing 1,790 3,122 3,167 General and administrative 1,802 3,313 2,779 10,418 17,364 15,494 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies | 18. COMMITMENTS AND CONTINGENCIES FCI provided their employees with collateral for personal loans which is deposited at a designated bank and the amount deposited was US$415 thousand and US$468 thousand at December 31, 2016 and 2017, respectively. Such amounts were accounted for as restricted cash. Operating Leases The Company entered into various operating lease agreements for office space that expire on various dates through March 2022. The Company recognized rent expense for the years ended December 31, 2015, 2016 and 2017 of US$2,453 thousand, US$2,595 thousand and US$3,131 thousand, respectively. The minimum operating lease payments expected under these leases as of December 31, 2017 were US$3,711 thousand, US$3,070 thousand, US$1,541 thousand, US$1,159 thousand, and US$65 thousand for the years ending December 31, 2018, 2019, 2020, 2021 and 2022, respectively. Litigation The Company is subject to legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business. Although the outcome of such proceedings and claims cannot be predicted with certainty, management does not believe that the outcome of any of these matters will have a material adverse effect on our business, results of operations, financial position or cash flows. Any litigation, however, involves potential risk and potentially significant litigation costs, and therefore there can be no assurance that any litigation which is now pending or which may arise in the future would not have such a material adverse effect on our business, financial position, results of operations or cash flows. All American Semiconductor, Inc. (“All American” or “AASI”) was a former distributor for the Company. On April 25, 2007, All American filed for Chapter 11 bankruptcy protection. At the time of the filing, the Company had US$256 thousand of unpaid accounts receivable from All American. On April 17, 2009 SMI USA and related entities were named as defendants in an adversary proceeding filed by the AASI Creditor Liquidating Trust (“CLT”) in the bankruptcy case pending in the U.S. Bankruptcy Court for the Southern District of Florida. The CLT was seeking the return of allegedly avoidable transfers in the amount of US$854 thousand. SMI USA filed an answer and affirmative defenses. In March 2010, SMI USA settled with the CLT by paying the amount of US$220 thousand and on April 1, 2010, the Bankruptcy Court granted the motion to approve stipulations to compromise controversy. On August 23, 2010, the Court entered an order dismissing the adversary proceeding. In June 2011, Liquidating Trustee for the CLT filed the AASI Creditor Liquidating Trustee’s Seventeenth Omnibus Objection to Claims but in August 2011, withdrew it with respect to SMI USA’s proof of claim. As a holder of allowed claims, we are entitled to receive distribution pursuant to the bankruptcy plan. On December 31, 2017, we received total distributions of US$265 thousand from the CLT. We are not expecting further distributions. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2017 | |
Segment Information | 19. SEGMENT INFORMATION The Company is the global leader and pioneer in developing NAND flash controllers for solid storage devices. The Company currently operates as one reportable segment. The chief operating decision maker is the Chief Executive Officer. The Company groups its products into three categories, based on the markets in which they may be used. The following summarizes the Company’s revenue by product category: Year Ended December 31 2015 2016 2017 US$ US$ US$ Mobile Storage 302,910 510,687 480,735 Mobile Communications 50,896 39,322 37,447 Others 7,491 6,137 5,222 361,297 556,146 523,404 Revenue is attributed to a geographic area based on the bill-to Year Ended December 31 2015 2016 2017 US$ US$ US$ Taiwan 71,387 75,926 72,768 United States 39,558 59,390 40,344 Japan 19,636 17,070 18,797 Korea 150,118 183,249 176,813 China 69,623 151,112 126,048 Others 10,975 69,399 88,634 361,297 556,146 523,404 Major customers representing at least 10% of net sales Year Ended December 31 2015 2016 2017 US$ % US$ % US$ % SK Hynix 108,645 30 156,541 28 150,762 29 Intel * * * * 50,205 10 * Less than 10% Long-lived assets (property and equipment, net) by geographic area were as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Taiwan 32,014 34,011 36,369 United States 274 237 242 Korea 1,891 1,448 1,936 China 16,268 12,181 12,798 Japan 22 15 25 50,469 47,892 51,370 |
Fair Value Measurement
Fair Value Measurement | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Measurement | 20. FAIR VALUE MEASUREMENT The following section describes the valuation methodologies the Company uses to measure assets and liabilities at fair value. The Company uses quoted prices in active markets for identical assets to determine fair value where applicable. This pricing methodology applies to Level 1 investments such as bond funds. The fair value of the principal protected notes was determined by its present value utilizing rate of return as the market observable input and therefore, these are classified as Level 2 instruments. This is because there generally are no quoted prices in active markets for identical principal protected notes at the reporting date. Hence, in order to determine the fair value, the Company must use observable inputs other than quoted prices in active markets for identical or similar instruments, quoted prices for similar instruments in active markets, or other inputs that are observable. For the years ended December 31, 2016 and 2017, none of the Company’s assets measured on a recurring basis was determined by using significant unobservable inputs. The following table presents our assets measured at fair value on a recurring basis as of December 31, 2016 and 2017: December 31, 2016 Level 1 Level 2 Level 3 Total US$ US$ US$ US$ Assets Short-term investments — trading securities 695 2,607 — 3,302 December 31, 2017 Level 1 Level 2 Level 3 Total US$ US$ US$ US$ Assets Short-term investments — trading securities 755 6,186 — 6,941 |
Summary of Significant Accoun29
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Basis of Presentation | Basis of Presentation The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). The consolidated financial statements include the accounts of SMTC and its wholly-owned subsidiaries. The Company owns 100% of the outstanding shares in all of its subsidiaries. All significant intercompany balances and transactions have been eliminated upon consolidation. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. The actual results could differ from those estimates. |
Concentration of Credit Risk and Significant Customers | Concentration of Credit Risk and Significant Customers Financial instruments that potentially subject the Company to a significant concentration of credit risk consist principally of cash equivalents, short term investments and accounts receivable. Cash, cash equivalents and short-term investments balances are maintained with high quality financial institutions, the composition and maturities of which are regularly monitored by management. The Company believes that the concentration of credit risk in its trade receivables, is substantially mitigated by the Company’s credit evaluation process, relatively short collection terms and the high level of credit worthiness of its customers. The Company performs ongoing credit evaluations of its customers’ financial conditions and limits the amount of credit extended based upon payment history and the customer’s current credit worthiness. The Company regularly reviews the allowance for bad debt and doubtful accounts by considering factors such as historical experience, credit quality, age of the accounts receivable balances and current economic conditions that may affect a customer’s ability to pay. Historically, a relatively small number of customers have accounted for a significant portion of our net revenue. Sales to one customer in 2015 and 2016, and two customers in 2017 accounted for 10% or more of the Company’s net sales, and these sales represented 30%, 28% and 39% of the Company’s net sales in 2015, 2016 and 2017, respectively. In 2015 and 2016, the significant customer was SK Hynix and in 2017, SK Hynix and Intel. The Company’s top ten customers in 2015, 2016 and 2017 accounted for approximately 72%, 75% and 72% of net sales, respectively. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amount of the Company’s financial instruments, including cash and cash equivalents, notes and accounts receivable and notes and accounts payables approximates fair value due to the short-term maturity of the instruments. Fair values of short-term investments represent quoted market prices, if available. If no quoted market prices are available, fair values are estimated based on discounted cash flow, or other valuation techniques. Long-term investments in privately-held companies with no readily determinable market value are recorded using the cost method, since the cost of obtaining verifiable fair value is unreasonably high. The Company periodically evaluates these investments for impairment. If it is determined that an other-than-temporary decline has occurred in the carrying value, an impairment loss is recorded for that period. The Company’s long-term liabilities approximate their fair values as they contain interest rates that vary according to market interest rates. Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that assets or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the Company. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1 — Use unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 — Use observable inputs other than Level 1 prices such as quoted prices for identical or similar instruments in markets that are not active, quoted prices for similar instruments in active markets, and model-based valuation in which all significant inputs are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Use inputs that are generally unobservable and reflect the use of significant management judgments and estimates. See Note 20, “Fair Value Measurement”, for the related disclosure. |
Cash Equivalents | Cash Equivalents The Company considers all highly liquid instruments acquired with a remaining maturity of three months or less when purchased to be cash equivalents. In addition, time deposits with maturities ranging from more than three months to one year are considered qualified as cash equivalents as the nature of the time deposits are similar to cash such that without advance notice to the bank, they can be readily converted into known amounts of cash with the principal of the time deposits protected and not subject to penalty in the event of an early withdrawal. Also, the risk of changes in value because of changes in interest rates is insignificant due to the fact that the Company can still earn interest based on a rate close to the on-going |
Short-term Investments | Short-term Investments The Company’s short-term investments primarily includes short-term income yielding investments with original maturities greater than three months from the purchase date and remaining maturities less than one year. These short-term investments consist mostly of bond funds and principal protected notes that are bought and held principally for the purpose of selling them in the near term and are classified as trading securities as well as senior notes classified as held-to-maturity |
Allowance for Doubtful Receivables | Allowance for Doubtful Receivables An allowance for doubtful receivables is provided based on a review of the collectability of accounts receivables. The Company determines the amount of allowance for doubtful receivables by examining the historical collection experience and current trends in the credit quality of its customers as well as its internal credit policies. |
Inventories | Inventories Inventories are stated at the lower of cost or market value. Inventories are recorded at standard cost and adjusted to the approximate weighted-average cost at the balance sheet date. Market value represents the current replacement cost for raw materials, work in process and finished goods. The Company assesses its inventory for estimated obsolescence or unmarketable inventory based upon management’s assumptions about future demand and market conditions. In estimating reserves for obsolescence, the Company primarily evaluates estimates based on the timing of the introduction of new products and the quantities remaining of old products and provides reserves for inventory on hand in excess of the estimated demand. Estimated losses on slow-moving items are recognized and included in the allowance for losses. |
Long-term Investments | Long-term Investments The Company has long-term investments in companies that it does not exercise significant influence and accounts for these investments under the cost method. Management regularly evaluates financial information related to these investments to determine whether an other than temporary decline in their value exists. Factors indicative of an other than temporary decline include recurring operating losses, credit defaults and subsequent rounds of financings at an amount below the cost basis of the investment. Management periodically weighs all quantitative and qualitative factors in determining if any impairment loss exists. When a decline in value is deemed to be other-than-temporary, the Company recognizes an impairment loss in other income and expense. |
Noncurrent Assets Held for Sale | Noncurrent Assets Held for Sale Non-current |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Significant additions, renewals and betterments are capitalized, while maintenance and repairs are expensed as incurred. Depreciation is computed using the straight-line method over estimated useful lives that range as follows: buildings — 25 to 50 years; machinery and equipment — 3 to 6 years; furniture and fixtures — 3 to 8 years; software — 1 to 5 years; leasehold and buildings improvement — the shorter of the estimated useful life or lease term, which is generally 2 to 6 years. Depreciation expense recognized for the years ended December 31, 2015, 2016 and 2017 was approximately US$7,936 thousand, US$9,482 thousand and US$10,599 thousand, respectively. Upon the sale or other disposal of property and equipment, the related cost and accumulated depreciation are removed from the accounts, and any gain or loss is credited or charged to operating income. |
Government Grants | Government Grants Grants received by the Company from the Korean government to assist with specific research and development activities are deducted from those research and development costs incurred, in the period in which the related expenses are incurred, to the extent that they are non-refundable. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill is the excess of the purchase price paid over the fair value of the net tangible and intangible assets acquired in a business combination. Intangible assets, which consist primarily of development technology, are amortized over their estimated useful lives, of 3.5 to 5.5 years. |
Impairment of Goodwill and Long-Lived Assets | Impairment of Goodwill and Long-Lived Assets The Company evaluates the recoverability of long-lived assets whenever events or changes in circumstances indicate the carrying value may not be recoverable. The determination of recoverability is based on an estimate of undiscounted cash flows expected to result from the use of an asset and its eventual disposition. The estimate of cash flows is based upon, among other things, certain assumptions about expected future operating performance, growth rates and other factors. Estimates of undiscounted cash flows may differ from actual cash flows due to, among other things, technological changes, economic conditions, changes to the business model or changes in operating performance. If the sum of the undiscounted cash flows is less than the carrying value, an impairment loss is recognized, measured as the amount by which the carrying value exceeds the fair value of the asset. Fair value is determined by reference to quoted market prices, if available, or discounted cash flows, as appropriate. See Note 11, “Goodwill and Acquired Intangible Assets,” regarding impairment testing in fiscal year 2015, 2016 and 2017. The Company monitors the recoverability of goodwill recorded in connection with acquisitions, by reporting unit, annually, or sooner if events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company conducts its annual impairment test of goodwill on November 30. Reporting units may be operating segments as a whole or an operation one level below an operating segment, referred to as a component. Prior to fiscal 2017, goodwill impairment is tested using a two-step In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2017-04, Estimating fair value is performed by utilizing various valuation approaches, such as income approach or market approach. The total of all reporting unit fair values was also compared to the Company’s market capitalization plus control premium for reasonableness. See Note 11, “Goodwill and Acquired Intangible Assets,” regarding impairment testing. |
Other Assets | Other Assets Other assets primarily consist of industrial property right and deposits for office leases. |
Restricted Assets | Restricted Assets Restricted assets consist of deposits required for litigation and restricted cash. Restricted cash represents cash set aside as collateral for obtaining capacity and borrowings as well as cash received from government grants with restriction on its usage. |
Bank loans | Bank loans Loans from financial institutions are stated at the amount of unpaid principal. Bank loans comprise borrowings which are held by banks based in Taiwan. |
Other long-term liabilities | Other long-term liabilities Other long-term liabilities primarily consist of payable to former shareholders of Shannon Systems and unrecognized tax benefit. |
Pension Costs | Pension Costs For employees under defined contribution pension plans, pension costs are recorded based on the actual contributions made to employees’ individual pension accounts. For employees under defined benefit pension plans, pension costs are recorded based on actuarial calculations. |
Revenue Recognition | Revenue Recognition Revenue from product sales is generally recognized upon shipment to the customer provided that the Company has received a signed purchase order, the price is fixed or determinable, transfer of title has occurred in accordance with the shipping terms specified in the arrangement with the customer, collectibility from the customer is considered reasonably assured, product returns are reasonably estimable and there are no remaining significant obligations or customer acceptance requirements. Revenue on development service orders is generally recognized upon completion and customer acceptance of contractually agreed milestones. The Company grants certain distributors limited rights of return and price protection rights on unsold products. The return rights are generally limited to five percent of the monetary value of products purchased within the preceding six months, provided that the distributor places a corresponding restocking order of equal or greater value. An allowance for sales returns for distributors and all customers is recorded at the time of sale based on historical returns information available, management’s judgment and any known factors at the time the financial statements are prepared that would significantly affect the allowance. Price protection rights are based on the inventory products the distributors have on hand at the date the price protection is offered. A reserve for price adjustments is recorded based on the estimated products on hand at the distributors and historical experience. The actual price adjustments to distributors incurred by the Company are minimal. The Company provides a warranty period of one year for manufacturing defects of its products. Warranty returns have been infrequent and relate to defective or off-specification |
Research and Development | Research and Development Research and development costs consist of expenditures incurred during the course of planned research and investigation aimed at the discovery of new knowledge that will be useful in developing new products or at significantly enhancing existing products as well as expenditures incurred for the design and testing of product alternatives. All expenditures related to research and development activities of the Company are charged to operating expenses when incurred. Third-party research and development costs are expensed when the contracted work has been performed or as milestone results have been achieved. |
Income Taxes | Income Taxes The provision for income tax represents income tax paid and payable for the current year plus changes in the deferred income tax assets and liabilities during the years. Deferred income tax assets are recognized for net operating loss carryforwards, research and development credits, and temporary differences. The Company believes that uncertainty exists regarding the realizability of certain deferred income tax assets and, accordingly, has established a valuation allowance for those deferred income tax assets to the extent the realizability is not deemed to be more likely than not. Deferred income tax assets and liabilities are measured using enacted tax rates. The Company utilizes a two step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained in a dispute with taxing authorities, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate settlement. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits in income tax expense. |
Foreign Currency Transactions | Foreign Currency Transactions Foreign currency transactions are recorded at the rates of exchange in effect when the transaction occurs. Gains or losses, resulting from the application of different foreign exchange rates when cash in foreign currency is converted into the entities’ functional currency, or when foreign currency receivables and payables are settled, are credited or charged to income in the period of conversion or settlement. At the balance sheet date, assets and liabilities denominated in foreign currencies are remeasured based on prevailing exchange rates and any resulting gains or losses are credited or charged to income. |
Translation of Foreign Currency Financial Statements | Translation of Foreign Currency Financial Statements The reporting currency of the Company is the U.S. dollars. The functional currency of some of the Company’s subsidiaries is the local currency of the respective entity. Accordingly, the financial statements of the foreign subsidiaries were translated into U.S. dollars at the following exchange rates: assets and liabilities — current rate on the balance sheet date; shareholders’ equity — historical rates; income and expenses — average rate during the period. The resulting translation adjustment is recorded as a separate component of comprehensive income. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income and loss represents net income (loss) plus the results of certain changes in shareholders’ equity during a period from non-owner Year Ended December 31, 2015 Year Ended December 31, 2016 Year Ended December 31, 2017 US$ US$ US$ Foreign Defined Accumulated Foreign Defined Accumulated Foreign Defined Accumulated Beginning balance 3,354 (849 ) 2,505 1,486 (853 ) 633 (69 ) (963 ) (1,032 ) Current-period change (1,868 ) (4 ) (1,872 ) (1,555 ) (110 ) (1,665 ) 3,390 285 3,675 Ending balance 1,486 (853 ) 633 (69 ) (963 ) (1,032 ) 3,321 (678 ) 2,643 |
Legal Contingencies | Legal Contingencies The Company is regularly involved in various claims and legal proceedings. Periodically, the Company reviews the status of each significant matter and assesses the potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount can be estimated, the Company accrues a liability for the estimated loss. Because of uncertainties related to these matters, accruals are based only on the best information available at the time. As additional information becomes available, the Company reassesses the potential liability related to the pending claims and litigation and revises these estimates as appropriate. Such revisions in the estimates of the potential liabilities could have a material impact on the results of operations and financial position. |
Earnings Per Share | Earnings Per Share Basic earnings per share are computed by dividing net earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share reflect the potential dilution that could occur if stock options and other dilutive securities were exercised. Dilutive securities are excluded from the computation of the diluted income per share in periods when their effect is anti-dilutive. The Company’s dilutive securities consist of employee stock options and restricted stock units. The effect of dilutive securities including employee stock options and restricted stock units were 1,534 thousand shares (384 thousand ADSs), 1,131 thousand shares (283 thousand ADSs) and 868 thousand shares (218 thousand ADSs) for the years ended December 31, 2015, 2016 and 2017, respectively. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718 Compensation — Stock Compensation. The Company uses the Black-Scholes valuation model for the valuation of stock options and recognizes compensation expense on a straight-line basis over the requisite service period of the award. The value of our restricted stock units is based on the fair value of our shares on the date of grant and expensed over the vesting period. Prior to the initial declaration of a quarterly cash dividend on January 22, 2013, the fair value of restricted stock units (“RSUs”) was measured based on the grant date share price, as the Company did not historically pay cash dividends on our common stock. For awards granted on or subsequent to January 22, 2013, the fair value of RSUs was measured based on the grant date share price, less the present value of expected dividends during the vesting period, discounted at a risk-free interest rate. |
Dividends | Dividends Our Board of Directors declared payment of our first quarterly dividend on our common stock in January 2013 and the first dividend payment was made on March 4, 2013. Our Board of Directors has subsequently declared and paid dividends in each successive quarter. On October 24, 2016 and October 24, 2017, our Board of Directors, instead of declaring a quarterly dividend, declared an annual dividend payable in four quarterly installments. The payment of future cash dividends are subject to the Board’s continuing determination that the payment of dividends are in the best interests of the Company’s shareholders and are in compliance with all laws and agreements of the Company applicable to the declaration and payment of cash dividends. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the FASB issued a new standard related to revenue recognition. Under the new standard, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB issued an amendment to defer the effective date. The new standard is effective for fiscal years beginning after December 15, 2017 and early adoption is permitted for annual reporting periods beginning after December 15, 2016. In March and April 2016, the FASB issued two accounting updates to clarify the implementation guidance on principal versus agent considerations, performance obligations and the licensing. In addition, the FASB issued another accounting update in May 2016 to address narrow-scope improvements to the guidance on collectability, noncash consideration, and completed contracts at transition and provides a practical expedient for contract modifications at transition. The new guidance is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application. The Company will adopt this new standard as of January 1, 2018, using the modified retrospective method with the cumulative effect of initially applying it recognized at the date of initial application. The Company has finalized its assessment and has identified that the adoption of this new standard will not have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In April 2015, the FASB issued an accounting update regarding the measurement date of a defined benefit obligation and plan assets. The amendment permits the entity with a fiscal year-end month-end month-end year-end. month-end year-end, In July 2015, the FASB issued an accounting update to simplify the measurement of inventory. The amendment requires the measurement of inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The amendment applies to inventories for which cost is determined by methods other than the last-in first-out In November 2015, the FASB issued an accounting update to simplify the presentation of deferred income taxes. The amendment requires that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying In February 2016, the FASB issued a new standard regarding leases (Topic 842). The new standard requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases other than that the entity elects the short-term lease recognition and measurement exemption. Qualitative and quantitative disclosures will be enhanced to better understand the amount, timing and uncertainty of cash flows arising from leases. In January 2018, the FASB issued an amendment that permits an entity to elect an optional transition practical expedient to not evaluate under Topic 842 land easements that exist or expired before the entity’s adoption of Topic 842 and that were not previously accounted for as leases under Topic 840, the current standard regarding leases. The guidance is effective for fiscal years beginning after December 15, 2018, and early adoption is permitted. The Company is currently evaluating the effect this standard will have on its financial position, results of operations, cash flow and financial statement disclosures. In March 2016, the FASB issued an accounting update to simplify several aspects of the accounting for share-based payment award transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The amendment is effective for fiscal years beginning after December 15, 2016, and earlier adoption is permitted. The adoption of this amendment did not have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In June 2016, the FASB issued an accounting update to amend the guidance on the impairment of financial instruments that are not measured at fair value through profit and loss. The amendment introduces a current expected credit loss (CECL) model based on expected losses rather than incurred losses to estimate credit losses on financial instruments measured at amortized cost and requires a broader range of reasonable and supportable information to estimate expected credit loss. In addition, under the amendment, an entity recognizes an allowance for expected credit losses on financial instruments measured at amortized cost and available-for-sale In August 2016, the FASB issued an accounting update to clarify the following eight cash flow classification issues: (1) debt prepayment or debt extinguishment costs, (2) settlement of zero-coupon In October 2016, the FASB issued an accounting update to simplify the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. The amendment removes the prohibition against the recognition of current and deferred income tax effects of intra-entity transfers of assets other than inventory until the asset has been sold to an outside party. The amendment is effective for fiscal years beginning after December 15, 2017, and earlier adoption is permitted. The adoption of this amendment is not expected to have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In October 2016, the FASB issued an accounting update to amend the consolidation guidance on how a reporting entity that is the single decision maker of a variable interest entity (“VIE”) should treat indirect interests in the entity held through related parties that are under common control with the reporting entity when determining whether it is the primary beneficiary of that VIE. Under this amendment, the single decision maker is required to consider that indirect economic interests in the VIE held through related parties that are under common control on a proportionate basis. However, this amendment does not change the existing characteristics of a primary beneficiary. The amendment is effective for fiscal years beginning after December 15, 2016, and earlier adoption is permitted. The adoption of this amendment did not have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In November 2016, the FASB issued an accounting update related to the classification and presentation of changes in restricted cash on the statement of cash flows. The amendment requires restricted cash or restricted cash equivalents should be included with cash and cash equivalent when reconciling the beginning-of-period end-of-period The following table reflects the adjustments made to the consolidated statements of cash flows to confirm prior period classifications under the new guidance for the periods presented: As Reported Adjustment As Adjusted US$ US$ US$ Year Ended December 31, 2014: Net cash provided by operating activities 68,725 — 68,725 Net cash provided by (used in) investing activities (15,413 ) 3,817 (11,596 ) Net cash used in financing activities (19,710 ) — (19,710 ) Net increase (decrease) in cash, cash equivalents, and restricted cash* 33,602 3,817 37,419 Effect of exchange rate changes (1,111 ) — (1,111 ) Cash, cash equivalents, and restricted cash* at beginning of year 161,720 17,864 179,584 Cash, cash equivalents, and restricted cash* at end of year 194,211 21,681 215,892 Year Ended December 31, 2015: Net cash provided by operating activities 65,946 — 65,946 Net cash used in investing activities (58,414 ) (44 ) (58,458 ) Net cash used in financing activities (20,271 ) — (20,271 ) Net increase (decrease) in cash, cash equivalents, and restricted cash* (12,739 ) (44 ) (12,783 ) Effect of exchange rate changes (953 ) — (953 ) Cash, cash equivalents, and restricted cash* at beginning of year 194,211 21,681 215,892 Cash, cash equivalents, and restricted cash* at end of year 180,519 21,637 202,156 * The restricted cash is only included in the amount of “as adjusted” item. To early adopt the accounting update, the Company has amended the presentation of changes in cash and cash equivalents by explaining the changes in the total of cash, cash equivalents, and restricted cash. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the statement of cash flows. As of December 31 2014 2015 2016 2017 US$ US$ US$ US$ Cash and cash equivalents 194,211 180,519 274,483 359,453 Restricted cash included in restricted assets-current 19,322 19,328 44,393 19,515 Restricted cash included in other assets 2,359 2,309 2,301 2,555 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows 215,892 202,156 321,177 381,523 Amounts included in restricted cash represent (a) cash and time deposits set aside as collateral for obtaining capacity; (b) cash received from government grants with restriction on its usage; and (c) cash and time deposits that are pledged for short-term loans. In January 2017, the FASB issued an accounting update to clarify the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendment provides a screen to determine when an integrated set of assets and activities (collectively referred to as a “set”) is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. If the screen is not met, the amendment requires that to be considered a business, a set must include an input and a substantive process that together significantly contribute to the ability to create output. The amendment is effective for fiscal years beginning after December 15, 2017. The Company is currently evaluating the impact that the adoption will have on its results of operations, financial position, cash flow and disclosures. In January 2017, the FASB issued an accounting update to simplify the accounting treatment for the impairment of goodwill. The amendment eliminates Step 2 from the goodwill impairment test, which measures a goodwill impairment loss by calculating the implied fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination. Instead, under this amendment, the entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value and the impairment loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendment is effective for fiscal years beginning after December 15, 2019, and early adoption is permitted. The Company adopted this amendment beginning in fiscal 2017 and performed the annual goodwill impairment test in accordance with the amended guidance. Refer to Note 11 for discussion of the annual goodwill impairment test. In February 2017, the FASB issued an accounting update to clarify the scope of asset derecognition guidance and accounting for partial sales of nonfinancial assets. The amendment defines the term “in substance nonfinancial asset” as a financial asset promised to counterparty in a contract if substantially all of the fair value of assets (recognized and unrecognized) that are promised to the counterparty in the contract is concentrated in nonfinancial assets and clarifies that an entity should identify each distinct nonfinancial asset or in substance nonfinancial asset promised to a counterparty and derecognize each asset when a counterparty obtains control of it. The amendment also clarifies that an entity should allocate consideration to each distinct asset by applying the guidance in Topic 606 on allocating the transaction price to performance obligations. Under this amendment, an entity is required to derecognize a distinct nonfinancial asset or distinct in substance nonfinancial asset in a partial sale transaction when it (1) does not have (or ceases to have) a controlling financial interest in the legal entity that holds the asset in accordance with Topic 810 and (2) transfers control of the asset in accordance with Topic 606. Once an entity transfers control of a distinct nonfinancial asset or distinct in substance nonfinancial asset, it is required to measure any noncontrolling interest it receives (or retains) at fair value. The amendment is effective for fiscal years beginning after December 15, 2017 and early adoption is permitted. The amendment should be applied on a full or modified retrospective basis. The adoption of this amendment is not expected to have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In March 2017, the FASB issued an accounting update to improve the presentation of net periodic pension cost and net periodic postretirement benefit cost. The amendment requires that an entity disaggregates the service cost component from the other components of net benefit cost and present the service cost component with other current compensation costs for related employees in the income statement. The amendment also requires an entity presents the other components elsewhere in the income statement and outside of income from operation if such subtotal is presented and allow only the service cost component of net benefit cost to be eligible for capitalization. The amendment is effective for fiscal years beginning after December 15, 2017 and early adoption is permitted. The amendment should be applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit in assets. The amendment allows for a practical expedient that permits an entity to use the amounts disclosed in its pension and other postretirement benefit plan note for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements. The Company intends not to apply the practical expedient for apply the retrospective presentation requirements. The adoption of this amendment is not expected to have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. In May 2017, the FASB issued an accounting update to provide clarity and reduce both (1) diversity in practice and (2) cost and complexity when applying the guidance in Topic 718, Compensation—Stock Compensation, to a change in the terms or conditions of a share-based payment award. Under the amendment, modification accounting is required to be applied unless all of the following are the same immediately before and after the change: (1) the award’s fair value (or calculated value or intrinsic value, if those measurement methods are used); (2) the award’s vesting conditions; and (3) the award’s classification as an equity or liability instrument. The amendment is effective for fiscal years beginning after December 15, 2017 and early adoption is permitted. The amendment should be applied prospectively to an award modified on or after the adoption date. The adoption of this amendment is not expected to have a material impact on the Company’s financial position, results of operations, cash flow and financial statement disclosures. |
Summary of Significant Accoun30
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Components of Accumulated Other Comprehensive Income (Loss) | The following table presents the components of accumulated other comprehensive income (loss) as of December 31, 2015, 2016 and 2017: Year Ended December 31, 2015 Year Ended December 31, 2016 Year Ended December 31, 2017 US$ US$ US$ Foreign Defined Accumulated Foreign Defined Accumulated Foreign Defined Accumulated Beginning balance 3,354 (849 ) 2,505 1,486 (853 ) 633 (69 ) (963 ) (1,032 ) Current-period change (1,868 ) (4 ) (1,872 ) (1,555 ) (110 ) (1,665 ) 3,390 285 3,675 Ending balance 1,486 (853 ) 633 (69 ) (963 ) (1,032 ) 3,321 (678 ) 2,643 |
Revised Previously Reported Consolidated Statements of Cash Flows | The following table reflects the adjustments made to the consolidated statements of cash flows to confirm prior period classifications under the new guidance for the periods presented: As Reported Adjustment As Adjusted US$ US$ US$ Year Ended December 31, 2014: Net cash provided by operating activities 68,725 — 68,725 Net cash provided by (used in) investing activities (15,413 ) 3,817 (11,596 ) Net cash used in financing activities (19,710 ) — (19,710 ) Net increase (decrease) in cash, cash equivalents, and restricted cash* 33,602 3,817 37,419 Effect of exchange rate changes (1,111 ) — (1,111 ) Cash, cash equivalents, and restricted cash* at beginning of year 161,720 17,864 179,584 Cash, cash equivalents, and restricted cash* at end of year 194,211 21,681 215,892 Year Ended December 31, 2015: Net cash provided by operating activities 65,946 — 65,946 Net cash used in investing activities (58,414 ) (44 ) (58,458 ) Net cash used in financing activities (20,271 ) — (20,271 ) Net increase (decrease) in cash, cash equivalents, and restricted cash* (12,739 ) (44 ) (12,783 ) Effect of exchange rate changes (953 ) — (953 ) Cash, cash equivalents, and restricted cash* at beginning of year 194,211 21,681 215,892 Cash, cash equivalents, and restricted cash* at end of year 180,519 21,637 202,156 * The restricted cash is only included in the amount of “as adjusted” item. |
Reconciliation of Cash Cash Equivalents and Restricted cash | To early adopt the accounting update, the Company has amended the presentation of changes in cash and cash equivalents by explaining the changes in the total of cash, cash equivalents, and restricted cash. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the statement of cash flows. As of December 31 2014 2015 2016 2017 US$ US$ US$ US$ Cash and cash equivalents 194,211 180,519 274,483 359,453 Restricted cash included in restricted assets-current 19,322 19,328 44,393 19,515 Restricted cash included in other assets 2,359 2,309 2,301 2,555 Total cash, cash equivalents, and restricted cash shown in the statements of cash flows 215,892 202,156 321,177 381,523 |
Business Acquisition (Tables)
Business Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Shannon Systems | |
Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition: US$ Cash, cash equivalents and restricted cash 1,904 Accounts receivable, net 946 Inventories 2,624 Other current assets 288 Property and equipment 71 Goodwill 33,204 Identifiable intangible assets 8,381 Accounts payable (644 ) Accrued expenses and other current liabilities (1,209 ) Net assets acquired 45,565 |
Identifiable Intangible Assets and Useful Lives | The identifiable intangible assets and respective useful lives are as follows: US$ Useful Life Developed technology 3,789 3.5 In-process 4,592 indefinite Total identifiable intangible assets 8,381 |
Results of Acquired Entity Included on Consolidated Statement of Income | The results of Shannon Systems since the acquisition date included on the consolidated statement of income for the year ended December 31, 2015 were as follows: US$ Net sales 9,049 Net income 421 |
Unaudited Proforma Information of Summary of Results of Operations | The following unaudited pro forma information represents a summary of the results of operations as if the acquisition occurred on January 1, 2014 and 2015 and includes certain pro forma adjustments, including amortization of identifiable intangibles from that date (in thousands except earnings per share): Year Ended December 31 2014 2015 Net sales 293,562 364,670 Net income 42,483 58,468 Earnings per share Basic 0.31 0.42 Diluted 0.31 0.42 Weighted average ordinary shares outstanding (thousand) Basic 136,164 138,880 Diluted 138,347 140,414 |
Bigtera | |
Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition: US$ Cash, cash equivalents and restricted cash 78 Accounts receivable, net 380 Other current assets 14 Property and equipment 15 Goodwill 625 Identifiable intangible assets 4,736 Accounts payable (436 ) Accrued expenses and other current liabilities (748 ) Net assets acquired 4,664 |
Identifiable Intangible Assets and Useful Lives | The identifiable intangible assets and respective useful lives are as follows: US$ Useful Life Know-how 3,753 5.5 Current technology 983 5.5 Total identifiable intangible assets 4,736 |
Results of Acquired Entity Included on Consolidated Statement of Income | The results of Bigtera since the acquisition date included on the consolidated statement of income for the year ended December 31, 2017 were as follows: US$ Net sales 2,993 Net income (314 ) |
Unaudited Proforma Information of Summary of Results of Operations | The following unaudited pro forma information represents a summary of the results of operations as if the acquisition occurred on January 1, 2016 and 2017 and includes certain pro forma adjustments, including amortization of identifiable intangibles from that date (in thousands except earnings per share): Year Ended December 31 2016 2017 Net sales 557,672 523,849 Net income 109,736 73,834 Earnings per share Basic 0.78 0.52 Diluted 0.77 0.51 Weighted average ordinary shares outstanding (thousand) Basic 140,919 142,738 Diluted 142,050 143,606 |
Cash, Cash Equivalents, and R32
Cash, Cash Equivalents, and Restricted Cash (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Details of Cash, Cash Equivalents, and Restricted Cash | December 31 2016 2017 US$ US$ Cash and deposits in bank 58,391 59,751 Time deposits 199,064 269,392 Bonds acquired under repurchase agreements 17,028 30,310 Total cash and cash equivalents 274,483 359,453 Restricted cash (Note 2) 46,694 22,070 321,177 381,523 |
Short-Term Investments (Tables)
Short-Term Investments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Short Term Investments | December 31 2016 2017 US$ US$ Trading securities 3,302 6,941 |
Notes and Accounts Receivable (
Notes and Accounts Receivable (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Notes and Accounts Receivable | December 31 2016 2017 US$ US$ Trade accounts receivable 75,946 81,165 Allowance for doubtful accounts (723 ) (598 ) Allowance for sales returns and discounts (1,624 ) (1,432 ) 73,599 79,135 |
Changes in Allowances | The changes in the allowances are summarized as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Allowances for doubtful accounts Balance, beginning of year 1,167 775 723 Reversals charged to expense, net (392 ) (12 ) (125 ) Write-offs — (40 ) — Balance, end of year 775 723 598 Year Ended December 31 2015 2016 2017 US$ US$ US$ Allowances for sales returns and discounts Balance, beginning of year 1,427 1,555 1,624 Additions charged to expense, net 1,753 3,285 3,093 Actual sales return and discount (1,625 ) (3,216 ) (3,285 ) Balance, end of year 1,555 1,624 1,432 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Components of Inventory | The components of inventories are as follows: December 31 2016 2017 US$ US$ Finished goods 24,782 41,365 Work in process 31,185 25,090 Raw materials 15,920 27,731 71,887 94,186 |
Long-Term Investments (Tables)
Long-Term Investments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Long-Term Investments | As of December 31, 2016 and 2017, the Company held equity investments in several privately-held companies with the carrying value as follows: Percentage December 31 2016 2017 2016 2017 US$ US$ Cost method: Cashido Corp. (Cashido) 2.1 % 2.1 % 91 — Vastview Technology, Corp. (Vastview) 2.9 % 2.9 % 29 — 120 — |
Noncurrent Assets Held for Sa37
Noncurrent Assets Held for Sale (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Noncurrent Assets Held for Sale | December 31 2016 2017 US$ US$ Assets held for sale 3,363 — 3,363 — |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property and Equipment | December 31 2016 2017 US$ US$ Cost: Land 9,309 9,309 Buildings 29,232 30,288 Machinery and equipment 18,122 21,665 Furniture and fixtures 6,760 7,746 Leasehold and buildings improvement 4,911 5,497 Software 22,745 24,864 Total 91,079 99,369 Accumulated depreciation: Buildings 2,708 3,472 Machinery and equipment 14,032 15,665 Furniture and fixtures 4,207 5,212 Leasehold and buildings improvement 3,591 4,213 Software 19,130 19,874 43,668 48,436 Prepayment and construction in progress 481 437 47,892 51,370 |
Goodwill and Acquired Intangi39
Goodwill and Acquired Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Intangible Assets Acquired from Acquisition | December 31 2016 2017 US$ US$ Cost Accumulated Accumulated Net Cost Accumulated Accumulated Net Acquisition-related intangible assets 8,381 — (3,154 ) 5,227 13,117 — (5,688 ) 7,429 |
Schedule of Goodwill | December 31 2016 2017 US$ US$ Cost Accumulated Foreign Net Cost Accumulated Foreign Net Goodwill 99,504 (30,808 ) (40 ) 68,656 100,129 (41,145 ) (20 ) 58,964 |
Short-Term Bank Loans (Tables)
Short-Term Bank Loans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Short-Term Bank Loans | December 31 2016 2017 US$ US$ Secured loans 25,000 25,000 25,000 25,000 |
Accrued Expenses and Other Cu41
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Expenses and Other Current Liabilities | December 31 2016 2017 US$ US$ Wages and bonus 29,028 29,629 Dividends 21,382 32,451 Research and development payable 5,456 5,638 License fees and royalties 4,021 3,729 Professional fees 2,038 2,286 Equipment 492 1,844 Others 6,319 8,186 68,736 83,763 |
Pension Plan (Tables)
Pension Plan (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Changes in Benefits Obligation and Plan Assets and Reconciliation of Funded Status | The changes in benefits obligation and plan assets and the reconciliation of funded status are as follows: December 31 2015 2016 2017 US$ US$ US$ Change in benefit obligation Projected benefit obligation at beginning of year 3,320 3,632 4,242 Service cost 273 487 1,572 Interest cost 57 104 336 Actuarial loss (gain) 79 151 (665 ) Benefits paid (97 ) (132 ) (354 ) Projected benefit obligation at end of year 3,632 4,242 5,131 Change in plan assets Fair value of plan assets at beginning of year 2,556 2,800 3,902 Actual return on plan assets 33 33 81 Employer contributions 328 1,203 1,358 Benefits paid (117 ) (134 ) (227 ) Fair value of plan assets at end of year 2,800 3,902 5,114 Funded status recognized as an other asset (liabilities) (832 ) (340 ) (17 ) |
Amounts Recognized in Accumulated Other Comprehensive Income | Amounts recognized in accumulated other comprehensive income consist of the following: Year Ended December 31 2015 2016 2017 US$ US$ US$ Net loss 852 963 678 Transition obligation 1 — — Total recognized in accumulated other comprehensive income 853 963 678 |
Components of Net Periodic Benefit Cost | The components of net periodic benefit cost are as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Service cost 273 487 1,572 Interest cost 57 104 336 Projected return on plan assets (47 ) (28 ) (58 ) Amortization of unrecognized net transition obligation and unrecognized net actuarial gain 27 11 37 Net periodic benefit cost 310 574 1,887 |
Other Changes in Plan Assets and Benefit Obligation Recognized in Other Comprehensive Loss | Other changes in plan assets and benefit obligation recognized in other comprehensive loss: 2015 2016 2017 US$ US$ US$ Recognize the decrease in net gain (loss) 4 111 (285 ) Amortization of net gain (loss) — (1 ) — Total recognized in other comprehensive loss (income) 4 110 (285 ) |
Expected Benefit Payments | Expected benefit payments: US$ 2018 188 2019 184 2020 407 2021 181 2022 182 2023 and thereafter 2,057 |
Actuarial Assumptions to Determine Benefit Obligations | The actuarial assumptions to determine the benefit obligations were as follows: 2015 2016 2017 Taiwan Korea Taiwan Korea Taiwan Korea Weighted-average assumptions used to determine benefit obligations: Discount rate 1.75 % 3.90 % 1.50 % 3.80 % 1.63 % 4.10 % Rate of compensation increase 4.25 % 4.00 % 4.25 % 3.50 % 4.25 % 3.50 % Weighted-average assumptions used to determine net projected benefit cost: Discount rate 1.75 % 3.90 % 1.50 % 3.80 % 1.63 % 4.10 % Expected long-term return on plan assets 2.00 % 1.20 % 2.00 % 1.10 % 1.75 % 1.10 % Rate of compensation increase 4.25 % 4.00 % 4.25 % 3.50 % 4.25 % 3.50 % |
Fair Values of FCI's Pension Plan Assets | The fair values of FCI’s pension plan assets at December 31, 2016 and 2017 are as follows: December 31 2016 2017 US$ US$ Guaranteed interest contract Kyobo Life Insurance Co. Ltd. 1,284 1,599 Shinhan Investment Co. . — 374 Fixed deposit Industrial Bank of Korea 1,537 1,892 2,821 3,865 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Components of Income Tax Expense | The components of income tax expense are as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Current 17,338 31,063 23,465 Deferred 911 (3,373 ) 581 Income tax expense 18,249 27,690 24,046 |
Income (Loss) Before Income Taxes for Domestic and Foreign Entities | The income (loss) before income taxes for domestic and foreign entities is as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Domestic (12,037 ) (20,663 ) (27,902 ) Foreign 90,537 159,293 126,903 78,500 138,630 99,001 |
Reconciliation of Income Tax Expense on Pretax Income at Statutory Rate and Income Tax Expense | The Company and its subsidiaries file separate income tax returns. A reconciliation of income tax expense on pretax income at statutory rate and income tax expense is shown below: Year Ended December 31 2015 2016 2017 US$ US$ US$ Tax expense at statutory rate of Cayman — — — Differences between Cayman and foreign statutory tax rates 18,765 34,415 24,255 Tax-exempt (906 ) (4,648 ) — Permanent differences (1,065 ) (7,792 ) (4,249 ) Temporary differences (330 ) (1,533 ) (1,445 ) Alternative minimum tax 4 594 4 Income tax (10%) on undistributed earnings 2,460 5,677 2,709 Net changes in income tax credit (897 ) (495 ) 166 Net changes in valuation allowance of deferred income tax assets 1,621 1,724 (2,401 ) Net operating loss carryforwards (2,052 ) (1,689 ) 1,492 Liabilities related to unrealized tax benefits 672 2,385 3,455 Adjustment of prior years’ taxes and others (23 ) (948 ) 60 Income tax expense 18,249 27,690 24,046 |
Deferred Income Tax Assets (Liabilities) | Deferred income tax assets (liabilities) are as follows: December 31 2016 2017 US$ US$ Notes and accounts receivable 44 44 Stock-based compensation 1,146 771 Allowance for sales return 205 154 Inventory reserve 1,646 1,311 Foreign currency translation 2 ( 5 ) Property and equipment 383 168 Investment tax credits 8,647 9,078 Net operating loss carryforwards 12,335 10,391 Others 411 562 Valuation allowance (20,836 ) (19,072 ) 3,983 3,402 |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits is as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Balance, beginning of year 4,655 5,639 10,286 Increases in tax positions taken in current year 2,337 4,675 6,647 Decrease in tax position taken in prior year primarily related to the resolution of tax audit (1,353 ) (28 ) (1,877 ) Balance, end of year 5,639 10,286 15,056 |
Summary of Major Jurisdictions and Tax Year Subject to Examination by Tax Authorities | The following table summarizes the Company’s major jurisdictions and tax year that remain subject to examination by tax authorities as of December 31, 2017: Tax Jurisdiction Tax Years China 2014 and onward Hong Kong 2014 and onward Taiwan 2012 and onward Korea 2012 and onward United States 2012 onward |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Cash Dividends Declared Per Ordinary Share | The Company declared cash dividends per ordinary share during the periods presented as follows: 2016 2017 Dividends Amount Dividends Amount First quarter $ 0.0375 $ 5,290 $ 0.050 $ 7,134 Second quarter $ 0.0375 5,290 $ 0.050 7,148 Third quarter $ 0.0375 5,297 $ 0.050 7,155 Fourth quarter $ 0.0500 7,065 $ 0.075 10,737 $ 22,942 $ 32,174 |
Equity Incentive Plan (Tables)
Equity Incentive Plan (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Stock Option and Restricted Stock Units Activity | The following is a summary of, the 2005 Plan and the 2015 Plan, which includes stock options and restricted stock units: Unit Available for grant at January 1, 2015 1,687 Authorized 20,000 Restricted stock units granted (2,000 ) Option and restricted stock units forfeited 175 Available for grant at December 31, 2015 19,862 Restricted stock units granted (1,446 ) Option and restricted stock units forfeited 335 Available for grant at December 31, 2016 18,751 Restricted stock units granted (1,391 ) Option and restricted stock units forfeited 27 Available for grant at December 31, 2017 17,387 |
Summary of Stock Option Activity | A summary of the stock option activity and related information is as follows: Number of Weighted Weighted Outstanding at January 1, 2015 1,058 1.47 Options forfeited (143 ) 1.47 Options exercised (336 ) 1.47 Outstanding at December 31, 2015 579 1.47 0.92 Options vested and expected to vest after December 31, 2015 579 1.47 0.92 Options forfeited (257 ) 1.47 Options exercised (64 ) 1.47 Outstanding at December 31, 2016 258 1.47 0.25 Options vested and expected to vest after December 31, 2016 258 1.47 0.25 Options exercised (258 ) 1.47 Outstanding at December 31, 2017 — — — |
Summary of Restricted Stock Units and Changes | A summary of the status of restricted stock units and changes is as follows: Number of Non-vested Weighted Weight Non-vested 2,160 4.90 0.31 Restricted stock units granted 2,000 6.83 Restricted stock units vested (2,003 ) 4.96 Restricted stock units forfeited (32 ) 5.85 Non-vested 2,125 6.65 0.73 Restricted stock units granted 1,446 12.67 Restricted stock units vested (1,726 ) 6.46 Restricted stock units forfeited (78 ) 6.57 Non-vested 1,767 11.65 0.47 Restricted stock units granted 1,391 10.75 Restricted stock units vested (1,593 ) 12.08 Restricted stock units forfeited (27 ) 10.69 Non-vested 1,538 10.36 0.33 |
Stock-based Compensation Expense | The following table shows total stock-based compensation expense included in the Consolidated Statements of Income for the years ended December 31, 2015, 2016 and 2017. Year Ended December 31 2015 2016 2017 US$ US$ US$ Cost of sales 261 400 293 Research and development 6,565 10,529 9,255 Sales and marketing 1,790 3,122 3,167 General and administrative 1,802 3,313 2,779 10,418 17,364 15,494 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Revenue by Product Category | The Company groups its products into three categories, based on the markets in which they may be used. The following summarizes the Company’s revenue by product category: Year Ended December 31 2015 2016 2017 US$ US$ US$ Mobile Storage 302,910 510,687 480,735 Mobile Communications 50,896 39,322 37,447 Others 7,491 6,137 5,222 361,297 556,146 523,404 |
Revenue by Geographic Area | Revenue is attributed to a geographic area based on the bill-to Year Ended December 31 2015 2016 2017 US$ US$ US$ Taiwan 71,387 75,926 72,768 United States 39,558 59,390 40,344 Japan 19,636 17,070 18,797 Korea 150,118 183,249 176,813 China 69,623 151,112 126,048 Others 10,975 69,399 88,634 361,297 556,146 523,404 |
Major customers representing at least 10% of net sales | Major customers representing at least 10% of net sales Year Ended December 31 2015 2016 2017 US$ % US$ % US$ % SK Hynix 108,645 30 156,541 28 150,762 29 Intel * * * * 50,205 10 * Less than 10% |
Long-Lived Assets (Property and Equipment, Net) by Geographic Area | Long-lived assets (property and equipment, net) by geographic area were as follows: Year Ended December 31 2015 2016 2017 US$ US$ US$ Taiwan 32,014 34,011 36,369 United States 274 237 242 Korea 1,891 1,448 1,936 China 16,268 12,181 12,798 Japan 22 15 25 50,469 47,892 51,370 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Assets Measured at Fair Value on Recurring Basis | The following table presents our assets measured at fair value on a recurring basis as of December 31, 2016 and 2017: December 31, 2016 Level 1 Level 2 Level 3 Total US$ US$ US$ US$ Assets Short-term investments — trading securities 695 2,607 — 3,302 December 31, 2017 Level 1 Level 2 Level 3 Total US$ US$ US$ US$ Assets Short-term investments — trading securities 755 6,186 — 6,941 |
Organization and Operations - A
Organization and Operations - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2017Product | |
Minimum | |
Organization And Operations [Line Items] | |
Number of product shipped annually | 750,000,000 |
Summary Of Significant Accoun49
Summary Of Significant Accounting Policies - Additional Information (Detail) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017USD ($)Customershares | Dec. 31, 2016USD ($)Customershares | Dec. 31, 2015USD ($)Customershares | |
Significant Accounting Policies [Line Items] | |||
Subsidiary ownership percentage | 100.00% | ||
Number of customers accounted for 10% or more sales | Customer | 2 | 1 | 1 |
Depreciation and amortization | $ | $ 10,599 | $ 9,482 | $ 7,936 |
Warranty period for manufacturing defects of products | 1 year | ||
Evaluation of tax benefits realized upon settlement | 50.00% | ||
Minimum | |||
Significant Accounting Policies [Line Items] | |||
Short term investment maturity period | 3 months | ||
Maximum | |||
Significant Accounting Policies [Line Items] | |||
Short term investment maturity period | 1 year | ||
Held-to-maturity investment maturity period | 1 year | ||
Net sales | Customers accounted for 10% or more | Top Ten Customers [Member] | |||
Significant Accounting Policies [Line Items] | |||
Major customers percentage of net sales | 72.00% | 75.00% | 72.00% |
Net sales | Customers accounted for 10% or more | One Customer [Member] | |||
Significant Accounting Policies [Line Items] | |||
Major customers percentage of net sales | 28.00% | 30.00% | |
Net sales | Customers accounted for 10% or more | Two Customers [Member] | |||
Significant Accounting Policies [Line Items] | |||
Major customers percentage of net sales | 39.00% | ||
Employee Stock Option And Restricted Stock Units [Member] | |||
Significant Accounting Policies [Line Items] | |||
The effect of dilutive securities of employee stock options and restricted stock units | 868 | 1,131 | 1,534 |
Employee Stock Option And Restricted Stock Units [Member] | American Depositary Shares | |||
Significant Accounting Policies [Line Items] | |||
The effect of dilutive securities of employee stock options and restricted stock units | 218 | 283 | 384 |
Software | Minimum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 1 year | ||
Software | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 5 years | ||
Development technology | Minimum | |||
Significant Accounting Policies [Line Items] | |||
Intangible asset amortized over estimated useful lives | 3 years 6 months | ||
Development technology | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Intangible asset amortized over estimated useful lives | 5 years 6 months | ||
Buildings | Minimum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 25 years | ||
Buildings | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 50 years | ||
Machinery and Equipment | Minimum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 3 years | ||
Machinery and Equipment | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 6 years | ||
Furniture and Fixtures | Minimum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 3 years | ||
Furniture and Fixtures | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 8 years | ||
Leasehold And Building Improvement | Minimum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 2 years | ||
Leasehold And Building Improvement | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment estimated useful life | 6 years |
Components of Accumulated Other
Components of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance, Foreign currency items | $ (69) | $ 1,486 | $ 3,354 |
Current-period change, Foreign currency items | 3,390 | (1,555) | (1,868) |
Ending balance, Foreign currency items | 3,321 | (69) | 1,486 |
Beginning balance, Defined benefit pension plans | (963) | (853) | (849) |
Current-period change, Defined benefit pension plans | 285 | (110) | (4) |
Ending balance, Defined benefit pension plans | (678) | (963) | (853) |
Beginning balance, Accumulated other comprehensive income (loss) | (1,032) | 633 | 2,505 |
Current-period change, Accumulated other comprehensive income (loss) | 3,675 | (1,665) | (1,872) |
Ending balance, Accumulated other comprehensive income (loss) | $ 2,643 | $ (1,032) | $ 633 |
Revised Previously Reported Con
Revised Previously Reported Consolidated Statements of Cash Flows (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||
Condensed Cash Flow Statements, Captions [Line Items] | ||||||||
Net cash provided by operating activities | $ 103,881 | $ 125,568 | $ 65,946 | $ 68,725 | ||||
Net cash provided by (used in) investing activities | (14,548) | (8,220) | (58,458) | (11,596) | ||||
Net cash provided by (used in) financing activities | (31,740) | 2,194 | (20,271) | (19,710) | ||||
Net increase (decrease) in cash, cash equivalents, and restricted cash | 57,593 | 119,542 | (12,783) | [1] | 37,419 | [1] | ||
EFFECT OF EXCHANGE RATE CHANGES | 2,753 | (521) | (953) | (1,111) | ||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF YEAR | 321,177 | 202,156 | [1] | 215,892 | [1] | 179,584 | [1] | |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF YEAR | $ 381,523 | 321,177 | 202,156 | [1] | 215,892 | [1] | ||
As Reported | ||||||||
Condensed Cash Flow Statements, Captions [Line Items] | ||||||||
Net cash provided by operating activities | 65,946 | 68,725 | ||||||
Net cash provided by (used in) investing activities | (58,414) | (15,413) | ||||||
Net cash provided by (used in) financing activities | (20,271) | (19,710) | ||||||
Net increase (decrease) in cash, cash equivalents, and restricted cash | [1] | (12,739) | 33,602 | |||||
EFFECT OF EXCHANGE RATE CHANGES | (953) | (1,111) | ||||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF YEAR | [1] | 180,519 | 194,211 | 161,720 | ||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF YEAR | [1] | 180,519 | 194,211 | |||||
Adjustment | ||||||||
Condensed Cash Flow Statements, Captions [Line Items] | ||||||||
Net cash provided by (used in) investing activities | (44) | 3,817 | ||||||
Net increase (decrease) in cash, cash equivalents, and restricted cash | [1] | (44) | 3,817 | |||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF YEAR | [1] | $ 21,637 | 21,681 | 17,864 | ||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF YEAR | [1] | $ 21,637 | $ 21,681 | |||||
[1] | The restricted cash is only included in the amount of "as adjusted" item. |
Reconciliation of Cash Cash Equ
Reconciliation of Cash Cash Equivalents and Restricted cash (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | [1] | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||||||
Cash and cash equivalents | $ 359,453 | $ 274,483 | $ 180,519 | $ 194,211 | ||||
Restricted cash included in restricted assets-current | 19,515 | 44,393 | 19,328 | 19,322 | ||||
Restricted cash included in other assets | 2,555 | 2,301 | 2,309 | 2,359 | ||||
Total cash ,cash equivalents, and restricted cash | $ 381,523 | $ 321,177 | $ 202,156 | [1] | $ 215,892 | [1] | $ 179,584 | |
[1] | The restricted cash is only included in the amount of "as adjusted" item. |
Business Acquisition - Addition
Business Acquisition - Additional Information (Detail) - USD ($) $ in Thousands | Jul. 03, 2017 | Jul. 01, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Business Acquisition [Line Items] | |||||
Other long-term liabilities | $ 22,329 | $ 16,910 | |||
Shannon Systems | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, percentage of outstanding shares acquired | 100.00% | ||||
Business acquisition shares issued, shares | 1,560,000 | ||||
Business acquisition shares issued, value | $ 7,640 | ||||
Business acquisition, cash paid to acquire interest | $ 37,925 | ||||
Business acquisition costs | $ 359 | ||||
Shannon Systems | Other Noncurrent Liabilities | |||||
Business Acquisition [Line Items] | |||||
Other long-term liabilities | 5,735 | ||||
Bigtera | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, percentage of outstanding shares acquired | 100.00% | ||||
Business acquisition, cash paid to acquire interest | $ 4,664 | ||||
Business acquisition costs | 171 | ||||
Bigtera | Other Noncurrent Liabilities | |||||
Business Acquisition [Line Items] | |||||
Other long-term liabilities | $ 1,721 |
Estimated Fair Values of Assets
Estimated Fair Values of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Jul. 03, 2017 | Dec. 31, 2016 | Jul. 01, 2015 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 58,964 | $ 68,656 | ||
Shannon Systems | ||||
Business Acquisition [Line Items] | ||||
Cash, cash equivalents and restricted cash | $ 1,904 | |||
Accounts receivable, net | 946 | |||
Inventories | 2,624 | |||
Other current assets | 288 | |||
Property and equipment | 71 | |||
Goodwill | 33,204 | |||
Identifiable intangible assets | 8,381 | |||
Accounts payable | (644) | |||
Accrued expenses and other current liabilities | (1,209) | |||
Net assets acquired | $ 45,565 | |||
Bigtera | ||||
Business Acquisition [Line Items] | ||||
Cash, cash equivalents and restricted cash | $ 78 | |||
Accounts receivable, net | 380 | |||
Other current assets | 14 | |||
Property and equipment | 15 | |||
Goodwill | 625 | |||
Identifiable intangible assets | 4,736 | |||
Accounts payable | (436) | |||
Accrued expenses and other current liabilities | (748) | |||
Net assets acquired | $ 4,664 |
Identifiable Intangible Assets
Identifiable Intangible Assets and Useful Lives (Detail) - USD ($) $ in Thousands | Jul. 03, 2017 | Jul. 01, 2015 |
Shannon Systems | ||
Schedule of Finite Lived and Indefinite Lived Intangible Assets Acquired Through Business Combinations [Line Items] | ||
Total identifiable intangible assets | $ 8,381 | |
Shannon Systems | In Process Research and Development | ||
Schedule of Finite Lived and Indefinite Lived Intangible Assets Acquired Through Business Combinations [Line Items] | ||
Indefinite-lived intangible assets | $ 4,592 | |
Indefinite-live intangible assets useful life | indefinite | |
Shannon Systems | Developed Technology | ||
Schedule of Finite Lived and Indefinite Lived Intangible Assets Acquired Through Business Combinations [Line Items] | ||
Finite-lived intangible assets | $ 3,789 | |
Finite-lived intangible assets useful life | 3 years 6 months | |
Bigtera | ||
Schedule of Finite Lived and Indefinite Lived Intangible Assets Acquired Through Business Combinations [Line Items] | ||
Finite-lived intangible assets | $ 4,736 | |
Total identifiable intangible assets | 4,736 | |
Bigtera | Know How Technology | ||
Schedule of Finite Lived and Indefinite Lived Intangible Assets Acquired Through Business Combinations [Line Items] | ||
Finite-lived intangible assets | $ 3,753 | |
Finite-lived intangible assets useful life | 5 years 6 months | |
Bigtera | Current Technology | ||
Schedule of Finite Lived and Indefinite Lived Intangible Assets Acquired Through Business Combinations [Line Items] | ||
Finite-lived intangible assets | $ 983 | |
Finite-lived intangible assets useful life | 5 years 6 months |
Results of Acquired Entity Incl
Results of Acquired Entity Included on Consolidated Statement of Income (Detail) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2015 | |
Shannon Systems | ||
Business Acquisition Information [Line Items] | ||
Net sales | $ 9,049 | |
Net income | $ 421 | |
Bigtera | ||
Business Acquisition Information [Line Items] | ||
Net sales | $ 2,993 | |
Net income | $ (314) |
Unaudited Pro forma Information
Unaudited Pro forma Information of Summary of Results of Operations (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Shannon Systems | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Net sales | $ 364,670 | $ 293,562 | ||
Net income | $ 58,468 | $ 42,483 | ||
Earnings per share | ||||
Basic | $ 0.42 | $ 0.31 | ||
Diluted | $ 0.42 | $ 0.31 | ||
Weighted average ordinary shares outstanding (thousand) | ||||
Basic | 138,880 | 136,164 | ||
Diluted | 140,414 | 138,347 | ||
Bigtera | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Net sales | $ 523,849 | $ 557,672 | ||
Net income | $ 73,834 | $ 109,736 | ||
Earnings per share | ||||
Basic | $ 0.52 | $ 0.78 | ||
Diluted | $ 0.51 | $ 0.77 | ||
Weighted average ordinary shares outstanding (thousand) | ||||
Basic | 142,738 | 140,919 | ||
Diluted | 143,606 | 142,050 |
Details of Cash, Cash Equivalen
Details of Cash, Cash Equivalents, and Restricted Cash (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | [1] | ||
Cash and Cash Equivalents [Line Items] | ||||||||
Cash and deposits in bank | $ 59,751 | $ 58,391 | ||||||
Time deposits | 269,392 | 199,064 | ||||||
Bonds acquired under repurchase agreements | 30,310 | 17,028 | ||||||
Total cash and cash equivalents | 359,453 | 274,483 | $ 180,519 | $ 194,211 | ||||
Restricted cash (Note 2) | 22,070 | 46,694 | ||||||
Total cash ,cash equivalents, and restricted cash | $ 381,523 | $ 321,177 | $ 202,156 | [1] | $ 215,892 | [1] | $ 179,584 | |
[1] | The restricted cash is only included in the amount of "as adjusted" item. |
Short Term Investments (Detail)
Short Term Investments (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Trading securities | $ 6,941 | $ 3,302 |
Short Term Investments - Additi
Short Term Investments - Additional Information (Detail) - Trading Securities [Member] - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Gain (Loss) on Investments [Line Items] | |||
Realized gains on sales of short-term investments, trading securities | $ 103,000 | $ 2,000 | $ 3,000 |
Unrealized holding loss on short-term investment | $ 0 | $ 0 | $ 0 |
Summary of Notes and Accounts R
Summary of Notes and Accounts Receivable (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Trade accounts receivable | $ 81,165 | $ 75,946 | ||
Allowance for doubtful accounts | (598) | (723) | $ (775) | $ (1,167) |
Allowance for sales returns and discounts | (1,432) | (1,624) | $ (1,555) | $ (1,427) |
Notes and accounts receivable, net | $ 79,135 | $ 73,599 |
Change in Allowances (Detail)
Change in Allowances (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Allowances for doubtful accounts | |||
Balance, beginning of year | $ 723 | $ 775 | $ 1,167 |
Reversals charged to expense, net | (125) | (12) | (392) |
Write-offs | (40) | ||
Balance, end of year | 598 | 723 | 775 |
Allowances for sales returns and discounts | |||
Balance, beginning of year | 1,624 | 1,555 | 1,427 |
Additions charged to expense, net | 3,093 | 3,285 | 1,753 |
Actual sales return and discount | (3,285) | (3,216) | (1,625) |
Balance, end of year | $ 1,432 | $ 1,624 | $ 1,555 |
Components of Inventories (Deta
Components of Inventories (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Inventory [Line Items] | ||
Finished goods | $ 41,365 | $ 24,782 |
Work in process | 25,090 | 31,185 |
Raw materials | 27,731 | 15,920 |
Inventory, Net | $ 94,186 | $ 71,887 |
Inventories - Additional Inform
Inventories - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Inventory [Line Items] | |||
Inventory written down | $ 698 | $ 2,995 | $ 2,525 |
Equity Investments with Carryin
Equity Investments with Carrying Value (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Cost-method Investments [Line Items] | ||
Long-term investments | $ 120 | |
Cashido Corp. (Cashido) | ||
Schedule of Cost-method Investments [Line Items] | ||
Long-term investments | $ 91 | |
Equity Investments Percentage of Ownership | 2.10% | 2.10% |
Vastview Technology, Corp. (Vastview) | ||
Schedule of Cost-method Investments [Line Items] | ||
Long-term investments | $ 29 | |
Equity Investments Percentage of Ownership | 2.90% | 2.90% |
Long-term Investment - Addition
Long-term Investment - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | 36 Months Ended | |||
Feb. 28, 2007 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2013 | Dec. 31, 2009 | Dec. 31, 2010 | |
Cashido Corp. (Cashido) | ||||||
Schedule of Cost-method Investments [Line Items] | ||||||
Cost method investment impairments other than temporary | $ 91 | $ 13 | ||||
Vastview Technology, Corp. (Vastview) | ||||||
Schedule of Cost-method Investments [Line Items] | ||||||
Invested in common stock | $ 3,360 | |||||
Cost method investment capital return | $ 46 | $ 808 | ||||
Recognized an impairment charges | $ 29 | $ 2,462 |
Summary of Noncurrent Assets He
Summary of Noncurrent Assets Held for Sale (Detail) $ in Thousands | Dec. 31, 2016USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Assets held for sale | $ 3,363 |
Disposal Group, Held-for-sale, Not Discontinued Operations | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Assets held for sale | $ 3,363 |
Noncurrent Assets Held for Sa68
Noncurrent Assets Held for Sale - Additional Information (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Gain (Loss) on disposition of other assets | $ 1,880 |
Property and Equipment (Detail)
Property and Equipment (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Land | $ 9,309 | $ 9,309 | |
Buildings | 30,288 | 29,232 | |
Machinery and equipment | 21,665 | 18,122 | |
Furniture and fixtures | 7,746 | 6,760 | |
Leasehold and buildings improvement | 5,497 | 4,911 | |
Software | 24,864 | 22,745 | |
Total | 99,369 | 91,079 | |
Accumulated Depreciation | 48,436 | 43,668 | |
Prepayment and construction in progress | 437 | 481 | |
Property, Plant and Equipment, Net | 51,370 | 47,892 | $ 50,469 |
Software | |||
Property, Plant and Equipment [Line Items] | |||
Accumulated Depreciation | 19,874 | 19,130 | |
Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Accumulated Depreciation | 3,472 | 2,708 | |
Machinery and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Accumulated Depreciation | 15,665 | 14,032 | |
Furniture and Fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Accumulated Depreciation | 5,212 | 4,207 | |
Leasehold and buildings improvement | |||
Property, Plant and Equipment [Line Items] | |||
Accumulated Depreciation | $ 4,213 | $ 3,591 |
Property And Equipment - Additi
Property And Equipment - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Leased Assets [Line Items] | ||
Net carrying value of leased properties | $ 709 | $ 728 |
Annual lease and rental income from operating lease | $ 42 |
Intangible Assets Acquired from
Intangible Assets Acquired from Acquisition (Detail) - FCI, Centronix, BTL, Shannon and Bigtera - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Finite-Lived Intangible Liabilities [Line Items] | ||
Cost | $ 13,117 | $ 8,381 |
Accumulated Impairment | 0 | 0 |
Accumulated Amortization | (5,688) | (3,154) |
Net Carrying Amount | $ 7,429 | $ 5,227 |
Goodwill And Acquired Intangi72
Goodwill And Acquired Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | 60 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2011 | Jul. 03, 2017 | Jul. 01, 2015 | |
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Intangible asset impairment losses | $ 0 | $ 0 | $ 0 | ||||
Amortization of intangible assets | 2,534 | 2,103 | 1,051 | ||||
Goodwill impairment | $ 10,337 | 10,337 | 0 | $ 0 | |||
Goodwill | $ 58,964 | $ 58,964 | $ 68,656 | ||||
FCI, Centronix and BTL | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Goodwill acquired during period | $ 66,300 | ||||||
Shannon Systems | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Goodwill | $ 33,204 | ||||||
Bigtera | |||||||
Goodwill and Intangible Assets Disclosure [Line Items] | |||||||
Goodwill | $ 625 |
Schedule of Goodwill (Detail)
Schedule of Goodwill (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Goodwill [Line Items] | ||
Cost | $ 100,129 | $ 99,504 |
Accumulated Impairment | (41,145) | (30,808) |
Foreign Currency Adjustment | (20) | (40) |
Net Carrying Amount | $ 58,964 | $ 68,656 |
Short-Term Bank Loans (Detail)
Short-Term Bank Loans (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Short-term Debt [Line Items] | ||
Bank loan | $ 25,000 | $ 25,000 |
Secured Loans | ||
Short-term Debt [Line Items] | ||
Bank loan | $ 25,000 | $ 25,000 |
Short-Term Bank Loans - Additio
Short-Term Bank Loans - Additional Information (Detail) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($)Bank | Dec. 31, 2015USD ($) | |
Short-term Debt [Line Items] | |||
Interest expense | $ 387 | $ 105 | $ 0 |
Number of banks | Bank | 2 | ||
Loans payable | 25,000 | $ 25,000 | |
Pledged deposit | $ 0 | $ 25,000 | |
Expected repayment year of bank loan | 2,018 | ||
Minimum | |||
Short-term Debt [Line Items] | |||
Interest rate | 0.953% | ||
Maximum | |||
Short-term Debt [Line Items] | |||
Interest rate | 1.51% |
Accrued Expenses and Other Cu76
Accrued Expenses and Other Current Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accrued Expenses and Other Current Liabilities [Line Items] | ||
Wages and bonus | $ 29,629 | $ 29,028 |
Dividends | 32,451 | 21,382 |
Research and development payable | 5,638 | 5,456 |
License fees and royalties | 3,729 | 4,021 |
Professional fees | 2,286 | 2,038 |
Equipment | 1,844 | 492 |
Others | 8,186 | 6,319 |
Accrued expenses and other current liabilities | $ 83,763 | $ 68,736 |
Pension Plan - Additional Infor
Pension Plan - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Accumulated benefit obligation | $ 3,210 | $ 2,648 | $ 2,098 |
Estimated amortization of net gain from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year | 33 | ||
FCI | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
The contribution under defined benefit plans | 0 | ||
Taiwan | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Contributions and Recognized Pension Costs under Labor Pension Act | $ 1,579 | $ 1,272 | $ 1,015 |
Contributions Based on Percentage Employee Salaries under Labor Standards Law | 2.00% | ||
The contribution under defined benefit plans | $ 69 | ||
Taiwan | Minimum | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Percentage of Contribution by an Employer to Employees Pension | 6.00% |
Changes in Benefits Obligation
Changes in Benefits Obligation and Plan Assets and Reconciliation of Funded Status (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Change in benefit obligation | |||
Projected benefit obligation at beginning of year | $ 4,242 | $ 3,632 | $ 3,320 |
Service cost | 1,572 | 487 | 273 |
Interest cost | 336 | 104 | 57 |
Actuarial loss (gain) | (665) | 151 | 79 |
Benefits paid | (354) | (132) | (97) |
Projected benefit obligation at end of year | 5,131 | 4,242 | 3,632 |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 3,902 | 2,800 | 2,556 |
Actual return on plan assets | 81 | 33 | 33 |
Employer contributions | 1,358 | 1,203 | 328 |
Benefits paid | (227) | (134) | (117) |
Fair value of plan assets at end of year | 5,114 | 3,902 | 2,800 |
Funded status recognized as an other asset (liabilities) | $ (17) | $ (340) | $ (832) |
Amounts Recognized in Accumulat
Amounts Recognized in Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Defined Benefit Plan Disclosure [Line Items] | ||||
Net loss | $ 678 | $ 963 | $ 852 | |
Transition obligation | 1 | |||
Total recognized in accumulated other comprehensive income | $ 678 | $ 963 | $ 853 | $ 849 |
Components of Net Periodic Bene
Components of Net Periodic Benefit Cost (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Net Periodic Benefit Cost: | |||
Service cost | $ 1,572 | $ 487 | $ 273 |
Interest cost | 336 | 104 | 57 |
Projected return on plan assets | (58) | (28) | (47) |
Amortization of unrecognized net transition obligation and unrecognized net actuarial gain | 37 | 11 | 27 |
Net periodic benefit cost | $ 1,887 | $ 574 | $ 310 |
Other Changes in Plan Assets an
Other Changes in Plan Assets and Benefit Obligation Recognized in Other Comprehensive Loss (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Other Changes in Plan Assets and Benefit Obligation Recognized in Other Comprehensive Income (Loss): | |||
Recognize the decrease in net gain (loss) | $ (285) | $ 111 | $ 4 |
Amortization of net gain (loss) | (1) | ||
Total recognized in other comprehensive loss (income) | $ (285) | $ 110 | $ 4 |
Expected Benefit Payments (Deta
Expected Benefit Payments (Detail) $ in Thousands | Dec. 31, 2017USD ($) |
Schedule Of Defined Benefit Plans Disclosures [Line Items] | |
2,018 | $ 188 |
2,019 | 184 |
2,020 | 407 |
2,021 | 181 |
2,022 | 182 |
2023 and thereafter | $ 2,057 |
Actuarial Assumptions to Determ
Actuarial Assumptions to Determine Benefit Obligations (Detail) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Taiwan | |||
Weighted-average assumptions used to determine benefit obligations: | |||
Discount rate | 1.63% | 1.50% | 1.75% |
Rate of compensation increase | 4.25% | 4.25% | 4.25% |
Weighted-average assumptions used to determine net projected benefit cost: | |||
Discount rate | 1.63% | 1.50% | 1.75% |
Expected long-term return on plan assets | 1.75% | 2.00% | 2.00% |
Rate of compensation increase | 4.25% | 4.25% | 4.25% |
Korea | |||
Weighted-average assumptions used to determine benefit obligations: | |||
Discount rate | 4.10% | 3.80% | 3.90% |
Rate of compensation increase | 3.50% | 3.50% | 4.00% |
Weighted-average assumptions used to determine net projected benefit cost: | |||
Discount rate | 4.10% | 3.80% | 3.90% |
Expected long-term return on plan assets | 1.10% | 1.10% | 1.20% |
Rate of compensation increase | 3.50% | 3.50% | 4.00% |
Fair Values Of FCI's Pension Pl
Fair Values Of FCI's Pension Plan Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Schedule Of Defined Benefit Plans Disclosures [Line Items] | ||||
Fair value of pension plan assets | $ 5,114 | $ 3,902 | $ 2,800 | $ 2,556 |
FCI | ||||
Schedule Of Defined Benefit Plans Disclosures [Line Items] | ||||
Fair value of pension plan assets | 3,865 | 2,821 | ||
FCI | Guaranteed Interest Contract | Kyobo Life Insurance Co. Ltd. | ||||
Schedule Of Defined Benefit Plans Disclosures [Line Items] | ||||
Fair value of pension plan assets | 1,599 | 1,284 | ||
FCI | Guaranteed Interest Contract | Shinhan Investment Co. | ||||
Schedule Of Defined Benefit Plans Disclosures [Line Items] | ||||
Fair value of pension plan assets | 374 | |||
FCI | Fixed Deposit | Industrial Bank of Korea | ||||
Schedule Of Defined Benefit Plans Disclosures [Line Items] | ||||
Fair value of pension plan assets | $ 1,892 | $ 1,537 |
Components of Income Tax Expens
Components of Income Tax Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Components Of Income Tax Expense Benefit [Line Items] | |||
Current | $ 23,465 | $ 31,063 | $ 17,338 |
Deferred | 581 | (3,373) | 911 |
Income tax expense | $ 24,046 | $ 27,690 | $ 18,249 |
Income (loss) Before Income Tax
Income (loss) Before Income Taxes for Domestic and Foreign Entities (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Components of Income Before Income Tax Expense (Benefit) [Line Items] | |||
Income (loss) before income taxes, domestic | $ (27,902) | $ (20,663) | $ (12,037) |
Income (loss) before income taxes, foreign | 126,903 | 159,293 | 90,537 |
INCOME BEFORE INCOME TAX | $ 99,001 | $ 138,630 | $ 78,500 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Tax Credit Carryforward [Line Items] | |||||
Corporate income tax rate | 17.00% | ||||
Change in valuation allowance | $ (1,764,000) | $ 1,792,000 | $ 2,253,000 | ||
Rate of corporate surtax, unappropriated earnings | 10.00% | ||||
Accumulated undistributed earnings from a foreign subsidiary | $ 325,000,000 | ||||
Deferred tax liability on undistributed foreign earnings | 0 | ||||
Unrecognized tax benefit | 15,056,000 | 10,286,000 | 5,639,000 | $ 4,655,000 | |
Total amount of interest expense and penalties | 617,000 | 575,000 | $ 363,000 | ||
Total amount of accrued interest and penalties | $ 3,421,000 | $ 2,587,000 | |||
Cayman Islands Tax Information Authority [Member] | |||||
Tax Credit Carryforward [Line Items] | |||||
Corporate income tax rate | 0.00% | 0.00% | 0.00% | ||
Scenario, Plan | |||||
Tax Credit Carryforward [Line Items] | |||||
Corporate income tax rate | 20.00% | ||||
Rate of corporate surtax, unappropriated earnings | 5.00% | ||||
Deferred tax assets | $ 529,000 | ||||
Foreign Tax Authority | Internal Revenue Service (IRS) [Member] | |||||
Tax Credit Carryforward [Line Items] | |||||
Net operating loss carryforwards for income tax purposes | $ 9,760,000 | ||||
Federal net operating loss carryforwards expiration year | 2,037 | ||||
Foreign Tax Authority | Research And Development | Internal Revenue Service (IRS) [Member] | |||||
Tax Credit Carryforward [Line Items] | |||||
Deferred tax assets tax credit carryforwards | $ 2,601,000 | ||||
Tax credit carryforward expiration year for federal | 2,037 | ||||
State and Local Jurisdiction [Member] | Research And Development | |||||
Tax Credit Carryforward [Line Items] | |||||
Deferred tax assets tax credit carryforwards | $ 1,785,000 | ||||
Tax credit carryforward expiration year for state | No expiration date | ||||
FCI | Research And Development | |||||
Tax Credit Carryforward [Line Items] | |||||
Deferred tax assets tax credit carryforwards | $ 4,546,000 | ||||
FCI | Research And Development | Minimum | |||||
Tax Credit Carryforward [Line Items] | |||||
Tax credit carryforward expiration year for federal | 2,018 | ||||
FCI | Research And Development | Maximum | |||||
Tax Credit Carryforward [Line Items] | |||||
Tax credit carryforward expiration year for federal | 2,022 |
Reconciliation of Income Tax Ex
Reconciliation of Income Tax Expense on Pretax Income at Statutory Rate and Income Tax Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation Of Income Taxes [Line Items] | |||
Differences between Cayman and foreign statutory tax rates | $ 24,255 | $ 34,415 | $ 18,765 |
Tax-exempt income | (4,648) | (906) | |
Permanent differences | (4,249) | (7,792) | (1,065) |
Temporary differences | (1,445) | (1,533) | (330) |
Alternative minimum tax | 4 | 594 | 4 |
Income tax (10%) on undistributed earnings | 2,709 | 5,677 | 2,460 |
Net changes in income tax credit | 166 | (495) | (897) |
Net changes in valuation allowance of deferred income tax assets | (2,401) | 1,724 | 1,621 |
Net operating loss carryforwards | 1,492 | (1,689) | (2,052) |
Liabilities related to unrealized tax benefits | 3,455 | 2,385 | 672 |
Adjustment of prior years' taxes and others | 60 | (948) | (23) |
Income tax expense | 24,046 | 27,690 | 18,249 |
Cayman Islands Tax Information Authority [Member] | |||
Reconciliation Of Income Taxes [Line Items] | |||
Tax expense at statutory rate | $ 0 | $ 0 | $ 0 |
Deferred Income Tax Assets (lia
Deferred Income Tax Assets (liabilities) (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Components of Deferred Tax Provision [Line Items] | ||
Notes and accounts receivable | $ 44 | $ 44 |
Stock-based compensation | 771 | 1,146 |
Allowance for sales return | 154 | 205 |
Inventory reserve | 1,311 | 1,646 |
Foreign currency translation | (5) | 2 |
Property and equipment | 168 | 383 |
Investment tax credits | 9,078 | 8,647 |
Net operating loss carryforwards | 10,391 | 12,335 |
Others | 562 | 411 |
Valuation allowance | (19,072) | (20,836) |
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent | $ 3,402 | $ 3,983 |
Reconciliation of Unrecognized
Reconciliation of Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||
Balance, beginning of year | $ 10,286 | $ 5,639 | $ 4,655 |
Increases in tax positions taken in current year | 6,647 | 4,675 | 2,337 |
Decrease in tax position taken in prior year primarily related to the resolution of tax audit | (1,877) | (28) | (1,353) |
Balance, end of year | $ 15,056 | $ 10,286 | $ 5,639 |
Summary of Major Jurisdictions
Summary of Major Jurisdictions and Tax Year Subject to Examination Tax Authorities (Detail) | 12 Months Ended |
Dec. 31, 2017 | |
China | |
Income Tax Examination [Line Items] | |
Years Subject to Income Tax Examination | 2014 and onward |
HONG KONG | |
Income Tax Examination [Line Items] | |
Years Subject to Income Tax Examination | 2014 and onward |
Taiwan | |
Income Tax Examination [Line Items] | |
Years Subject to Income Tax Examination | 2012 and onward |
Korea | |
Income Tax Examination [Line Items] | |
Years Subject to Income Tax Examination | 2012 and onward |
United States | |
Income Tax Examination [Line Items] | |
Years Subject to Income Tax Examination | 2012 onward |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) - $ / shares | Oct. 24, 2017 | Oct. 24, 2016 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Retained Earnings Adjustments [Line Items] | |||||||||||||
Dividend distribution allowance description | SMI Taiwan subsidiary may only distribute dividends after it has made allowances as determined under ROC GAAP at each year-end for a. Payment of taxes; b. Recovery of prior years' deficits, if any; c. 10% of remaining balance after deduction for a and b as legal reserve; d. Special reserve based on relevant laws or regulations or 10% of remaining balance for deduction from above a to c as special reserve when necessary. | ||||||||||||
Dividend declared | $ 0.3 | $ 0.2 | $ 0.075 | $ 0.050 | $ 0.050 | $ 0.050 | $ 0.0500 | $ 0.0375 | $ 0.0375 | $ 0.0375 | $ 0.30 | $ 0.20 | $ 0.2625 |
American Depositary Shares | |||||||||||||
Retained Earnings Adjustments [Line Items] | |||||||||||||
Dividend declared | $ 1.2 | $ 0.8 |
Cash Dividends Declared Per Ord
Cash Dividends Declared Per Ordinary Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | Oct. 24, 2017 | Oct. 24, 2016 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Dividends Payable [Line Items] | |||||||||||||
Dividend Per Share | $ 0.3 | $ 0.2 | $ 0.075 | $ 0.050 | $ 0.050 | $ 0.050 | $ 0.0500 | $ 0.0375 | $ 0.0375 | $ 0.0375 | $ 0.30 | $ 0.20 | $ 0.2625 |
Amount | $ 10,737 | $ 7,155 | $ 7,148 | $ 7,134 | $ 7,065 | $ 5,297 | $ 5,290 | $ 5,290 | $ 32,174 | $ 22,942 |
Equity Incentive Plan - Additio
Equity Incentive Plan - Additional Information (Detail) - USD ($) | 1 Months Ended | 12 Months Ended | ||||||
Apr. 30, 2010 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2009 | Dec. 31, 2006 | Jun. 03, 2015 | Apr. 22, 2005 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock option exchange for new stock option granted | 4,369,000 | |||||||
Stock options exercise price | $ 1.47 | |||||||
Eligible stock options exchanged for new stock options granted | 3,785,000 | |||||||
Stock Option Granted | 0 | 0 | 0 | |||||
Stock Option Granted Intrinsic Value | $ 3,040,000 | $ 580,000 | $ 3,688,000 | |||||
Total unrecognized compensation cost related to non-vested share-based compensation | 0 | |||||||
Cash received from employee toward stock option exercise | 380,000 | 93,000 | 494,000 | |||||
Tax effect for stock-based compensation benefit (expense) for option and restricted stock units exercised | 124,000 | 37,000 | 561,000 | |||||
Minimum | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock option granted exercise price | $ 1.85 | |||||||
Employee Stock Options And Restricted Stock Units [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Tax effect for stock-based compensation benefit (expense) for option and restricted stock units exercised | $ 2,273,000 | $ 1,702,000 | $ 1,647,000 | |||||
2005 Equity Incentive Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Ordinary shares authorized | 10,000,000 | |||||||
Additional ordinary shares authorized | 15,000,000 | 15,000,000 | ||||||
2005 Equity Incentive Plan | Restricted Stock Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Conversion ratio of restricted stock unit to ordinary shares | One-for-one | |||||||
2015 Equity Incentive Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Ordinary shares authorized | 20,000,000 | |||||||
The 2005 Plan and The 2015 Plan | Restricted Stock Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Total unrecognized compensation cost related to non-vested share-based compensation | $ 4,736,000 | |||||||
The 2005 Plan and The 2015 Plan | Employee Stock Options And Restricted Stock Units [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Ordinary shares authorized | 20,000,000 |
Summary of Stock Option and Res
Summary of Stock Option and Restricted Stock Units Activity (Detail) - The 2005 Plan and The 2015 Plan - Employee Stock Options And Restricted Stock Units [Member] - shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Available for grant at beginning date | 18,751,000 | 19,862,000 | 1,687,000 |
Authorized | 20,000,000 | ||
Restricted stock units granted | (1,391,000) | (1,446,000) | (2,000,000) |
Option and restricted stock units forfeited | 27,000 | 335,000 | 175,000 |
Available for grant at ending balance | 17,387,000 | 18,751,000 | 19,862,000 |
Summary of Stock Option Activit
Summary of Stock Option Activity and Related Information (Detail) - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Options Shares | |||
Outstanding at beginning period | 258 | 579 | 1,058 |
Options forfeited | (257) | (143) | |
Options exercised | (258) | (64) | (336) |
Outstanding at ending period | 258 | 579 | |
Options vested and expected to vest after ending period | 258 | 579 | |
Weighted Average Exercise Price | |||
Outstanding at beginning period | $ 1.47 | $ 1.47 | $ 1.47 |
Options forfeited | 1.47 | 1.47 | |
Options exercised | $ 1.47 | 1.47 | 1.47 |
Outstanding at ending period | 1.47 | 1.47 | |
Options vested and expected to vest after ending period | $ 1.47 | $ 1.47 | |
Weighted Average Remaining Contractual Life | |||
Outstanding at ending period | 3 months | 11 months 1 day | |
Options vested and expected to vest after ending period | 3 months | 11 months 1 day |
Summary of Status of Restricted
Summary of Status of Restricted Stock Units and Changes (Detail) - Restricted Stock Units - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Nonvested Stock Units | |||
Nonvested at beginning period | 1,767 | 2,125 | 2,160 |
Restricted stock units granted | 1,391 | 1,446 | 2,000 |
Restricted stock units vested | (1,593) | (1,726) | (2,003) |
Restricted stock units forfeited | (27) | (78) | (32) |
Nonvested at ending period | 1,538 | 1,767 | 2,125 |
Weighted Average Grant Date Fair Value | |||
Nonvested at beginning period | $ 11.65 | $ 6.65 | $ 4.90 |
Restricted stock units granted | 10.75 | 12.67 | 6.83 |
Restricted stock units vested | 12.08 | 6.46 | 4.96 |
Restricted stock units forfeited | 10.69 | 6.57 | 5.85 |
Nonvested at ending period | $ 10.36 | $ 11.65 | $ 6.65 |
Weighted Average Remaining Recognition Period (Years) | |||
Nonvested at ending period | 3 months 29 days | 5 months 19 days | 8 months 23 days |
Table of Stock-based Compensati
Table of Stock-based Compensation Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | $ 15,494 | $ 17,364 | $ 10,418 |
Cost of Sales | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | 293 | 400 | 261 |
Research and Development Expense | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | 9,255 | 10,529 | 6,565 |
Selling and Marketing Expense | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | 3,167 | 3,122 | 1,790 |
General and Administrative Expense | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | $ 2,779 | $ 3,313 | $ 1,802 |
Commitments And Contingencies -
Commitments And Contingencies - Additional Information (Detail) - USD ($) $ in Thousands | Apr. 17, 2009 | Mar. 31, 2010 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Apr. 25, 2007 |
Commitments and Contingencies Disclosure [Line Items] | ||||||
Restricted cash deposited | $ 22,070 | $ 46,694 | ||||
Operating lease rental expenses | 3,131 | 2,595 | $ 2,453 | |||
Minimum operating lease payment, 2018 | 3,711 | |||||
Minimum operating lease payment, 2019 | 3,070 | |||||
Minimum operating lease payment, 2020 | 1,541 | |||||
Minimum operating lease payment, 2021 | 1,159 | |||||
Minimum operating lease payment, 2022 | 65 | |||||
Unpaid accounts receivable from distributor, filed for Chapter 11 bankruptcy protection | 81,165 | 75,946 | ||||
Adversary proceeding pending on litigation filled by AASI creditor liquidating trust | $ 854 | |||||
Litigation settlement expenses | $ 220 | |||||
All American | ||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||
Unpaid accounts receivable from distributor, filed for Chapter 11 bankruptcy protection | $ 256 | |||||
Distribution claim received as beneficiary | 265 | |||||
FCI | ||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||
Restricted cash deposited | $ 468 | $ 415 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2017Segment | |
Reportable segment | 1 |
Revenue by Product Category (De
Revenue by Product Category (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||
NET SALES | $ 523,404 | $ 556,146 | $ 361,297 |
Mobile Storage | |||
Segment Reporting Information [Line Items] | |||
NET SALES | 480,735 | 510,687 | 302,910 |
Mobile Communications | |||
Segment Reporting Information [Line Items] | |||
NET SALES | 37,447 | 39,322 | 50,896 |
Others | |||
Segment Reporting Information [Line Items] | |||
NET SALES | $ 5,222 | $ 6,137 | $ 7,491 |
Revenue by Geographic Area (Det
Revenue by Geographic Area (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
NET SALES | $ 523,404 | $ 556,146 | $ 361,297 |
Taiwan | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
NET SALES | 72,768 | 75,926 | 71,387 |
United States | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
NET SALES | 40,344 | 59,390 | 39,558 |
Japan | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
NET SALES | 18,797 | 17,070 | 19,636 |
Korea | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
NET SALES | 176,813 | 183,249 | 150,118 |
China | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
NET SALES | 126,048 | 151,112 | 69,623 |
Others | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
NET SALES | $ 88,634 | $ 69,399 | $ 10,975 |
Major customers representing at
Major customers representing at least 10% of net sales (Detail) - Net sales - Customers accounted for 10% or more - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
SK Hynix | |||||
Revenue, Major Customer [Line Items] | |||||
Major customers, revenue | $ 150,762 | $ 156,541 | $ 108,645 | ||
Major customers, percentage of net sales | 29.00% | 28.00% | 30.00% | ||
Intel | |||||
Revenue, Major Customer [Line Items] | |||||
Major customers, revenue | $ 50,205 | [1] | [1] | ||
Major customers, percentage of net sales | 10.00% | [1] | [1] | ||
[1] | Less than 10% |
Long-lived Assets (Property And
Long-lived Assets (Property And Equipment, net) by Geographic Area (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property and equipment, net | $ 51,370 | $ 47,892 | $ 50,469 |
Taiwan | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property and equipment, net | 36,369 | 34,011 | 32,014 |
United States | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property and equipment, net | 242 | 237 | 274 |
Korea | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property and equipment, net | 1,936 | 1,448 | 1,891 |
China | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property and equipment, net | 12,798 | 12,181 | 16,268 |
Japan | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property and equipment, net | $ 25 | $ 15 | $ 22 |
Assets Measured at Fair Value o
Assets Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments - trading securities | $ 6,941 | $ 3,302 |
Fair Value, Inputs, Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments - trading securities | 755 | 695 |
Fair Value, Inputs, Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments - trading securities | $ 6,186 | $ 2,607 |