Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Oct. 02, 2021 | Nov. 23, 2021 | Apr. 03, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Oct. 2, 2021 | ||
Current Fiscal Year End Date | --10-02 | ||
Document Transition Report | false | ||
Entity File Number | 001-33962 | ||
Entity Registrant Name | COHERENT, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 94-1622541 | ||
Entity Address, Address Line One | 5100 Patrick Henry Drive | ||
Entity Address, City or Town | Santa Clara | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 95054 | ||
City Area Code | 408 | ||
Local Phone Number | 764-4000 | ||
Title of 12(b) Security | Common Stock, $0.01 par value | ||
Trading Symbol | COHR | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding (shares) | 24,690,975 | ||
Entity Public Float | $ 6,282,554,076 | ||
Entity Central Index Key | 0000021510 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
ICFR Auditor Attestation Flag | true |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 456,534 | $ 440,258 |
Restricted cash | 1,527 | 765 |
Short-term investments | 0 | 35,346 |
Accounts receivable—net of allowances of $6,605 and $7,630, respectively | 249,389 | 220,289 |
Inventories | 392,241 | 426,756 |
Prepaid expenses and other assets | 79,594 | 88,250 |
Total current assets | 1,179,285 | 1,211,664 |
Property and equipment, net | 302,613 | 245,678 |
Goodwill | 105,261 | 101,317 |
Intangible assets, net | 14,740 | 21,765 |
Non-current restricted cash | 4,460 | 4,497 |
Other assets | 282,571 | 242,575 |
Total assets | 1,888,930 | 1,827,496 |
Current liabilities: | ||
Short-term borrowings and current-portion of long-term obligations | 18,395 | 16,817 |
Accounts payable | 104,539 | 60,225 |
Income taxes payable | 20,991 | 6,861 |
Other current liabilities | 238,290 | 184,155 |
Total current liabilities | 382,215 | 268,058 |
Long-term obligations | 425,800 | 411,140 |
Other long-term liabilities | 212,730 | 221,074 |
Commitments and contingencies (Note 13) | ||
Stockholders' equity: | ||
Common stock, Authorized - 500,000 shares, par value $.01 per share: Outstanding - 24,538 shares and 24,257 shares, respectively | 244 | 241 |
Additional paid-in capital | 123,135 | 80,275 |
Accumulated other comprehensive loss | (20,818) | (25,667) |
Retained earnings | 765,624 | 872,375 |
Total stockholders' equity | 868,185 | 927,224 |
Total liabilities and stockholders' equity | $ 1,888,930 | $ 1,827,496 |
Common Stock, Shares Authorized | 500,000,000 | 500,000,000 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | Sep. 29, 2018 |
Statement of Financial Position [Abstract] | ||||
Allowance for doubtful accounts receivable | $ 6,605 | $ 7,630 | $ 8,690 | $ 4,568 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 | ||
Common Stock, Shares Authorized | 500,000,000 | 500,000,000 | ||
Common Stock, Shares, Outstanding | 24,538,000 | 24,257,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Income Statement [Abstract] | |||
Net sales | $ 1,487,468 | $ 1,228,999 | $ 1,430,640 |
Cost of sales | 918,628 | 818,125 | 944,175 |
Gross profit | 568,840 | 410,874 | 486,465 |
Operating expenses: | |||
Research and development | 124,266 | 115,578 | 117,353 |
Selling, general and administrative | 303,863 | 270,464 | 272,257 |
Merger and acquisition costs | 236,047 | 0 | 0 |
Goodwill and other impairment charges | 0 | 451,025 | 0 |
Amortization of intangible assets | 2,877 | 3,987 | 13,760 |
Total operating expenses | 667,053 | 841,054 | 403,370 |
Income (loss) from operations | (98,213) | (430,180) | 83,095 |
Other income (expense): | |||
Interest income | 458 | 1,053 | 1,119 |
Interest expense | (18,059) | (17,037) | (19,122) |
Other—net | 276 | 3,441 | (5,044) |
Total other expense, net | (17,325) | (12,543) | (23,047) |
Income (loss) before income taxes | (115,538) | (442,723) | 60,048 |
Provision for (benefit from) income taxes | (8,787) | (28,584) | 6,223 |
Net income (loss) | $ (106,751) | $ (414,139) | $ 53,825 |
Net income (loss) per share: | |||
Basic (in dollars per share) | $ (4.38) | $ (17.18) | $ 2.23 |
Diluted (in dollars per share) | $ (4.38) | $ (17.18) | $ 2.22 |
Shares used in computation: | |||
Basic (in shares) | 24,390 | 24,105 | 24,118 |
Diluted (in shares) | 24,390 | 24,105 | 24,279 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | ||
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ (106,751) | $ (414,139) | $ 53,825 | |
Other comprehensive income (loss): | ||||
Translation adjustment, net of taxes | [1],[2] | 4,736 | 9,248 | (32,609) |
Changes in unrealized gains (losses) on available-for-sale securities, net of taxes | [1],[3] | (1) | 1 | 0 |
Defined benefit pension plans, net of taxes | [1],[4] | 114 | 1,420 | (6,560) |
Other comprehensive income (loss), net of tax | 4,849 | 10,669 | (39,169) | |
Comprehensive income (loss) | $ (101,902) | $ (403,470) | $ 14,656 | |
[1] | Reclassification adjustments were not significant during fiscal 2021, 2020, and 2019. | |||
[2] | Tax expenses (benefits) of $(921), $2,731, and $(5,161) were provided on translation adjustments during fiscal 2021, 2020, and 2019, respectively. | |||
[3] | Tax expenses (benefits) were not provided on changes in unrealized gains (losses) on available-for-sale securities during fiscal 2021, 2020, and 2019, respectively. | |||
[4] | Tax expenses (benefits) of $152, $713, and $(2,371) were provided on changes in defined benefit pension plans during fiscal 2021, 2020, and 2019, respectively. |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Statement of Comprehensive Income [Abstract] | |||
Tax expense (benefit) provided on translation adjustments | $ (921) | $ 2,731 | $ (5,161) |
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, Tax | $ (152) | $ (713) | $ 2,371 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income | Retained Earnings |
Beginning Balance (in shares) at Sep. 29, 2018 | 24,299 | ||||
Beginning balance at Sep. 29, 2018 | $ 1,314,464 | $ 242 | $ 78,700 | $ 2,833 | $ 1,232,689 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Common stock issued under stock plans, net of shares withheld for employee taxes (in shares) | 287 | ||||
Common stock issued under stock plans, net of shares withheld for employee taxes | (3,368) | $ 2 | (3,370) | ||
Repurchases of common stock (in shares) | (604) | ||||
Repurchase of common stock | (77,410) | $ (6) | (77,404) | ||
Stock-based compensation | 36,394 | 36,394 | |||
Net income (loss) | 53,825 | 53,825 | |||
Other comprehensive loss, net of tax | (39,169) | (39,169) | |||
Ending balance (in shares) at Sep. 28, 2019 | 23,982 | ||||
Ending balance at Sep. 28, 2019 | 1,284,736 | $ 238 | 34,320 | (36,336) | 1,286,514 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Common stock issued under stock plans, net of shares withheld for employee taxes (in shares) | 275 | ||||
Common stock issued under stock plans, net of shares withheld for employee taxes | (187) | $ 3 | (190) | ||
Stock-based compensation | 46,145 | 46,145 | |||
Net income (loss) | (414,139) | (414,139) | |||
Other comprehensive loss, net of tax | $ 10,669 | 10,669 | |||
Ending balance (in shares) at Oct. 03, 2020 | 24,257 | 24,257 | |||
Ending balance at Oct. 03, 2020 | $ 927,224 | $ 241 | 80,275 | (25,667) | 872,375 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Common stock issued under stock plans, net of shares withheld for employee taxes (in shares) | 281 | ||||
Common stock issued under stock plans, net of shares withheld for employee taxes | 2,121 | $ 3 | 2,118 | ||
Stock-based compensation | 40,742 | 40,742 | |||
Net income (loss) | (106,751) | (106,751) | |||
Other comprehensive loss, net of tax | $ 4,849 | 4,849 | |||
Ending balance (in shares) at Oct. 02, 2021 | 24,538 | 24,538 | |||
Ending balance at Oct. 02, 2021 | $ 868,185 | $ 244 | $ 123,135 | $ (20,818) | $ 765,624 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (106,751) | $ (414,139) | $ 53,825 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation and amortization | 44,238 | 46,705 | 54,925 |
Amortization of intangible assets | 10,733 | 30,128 | 61,460 |
Impairment of goodwill | 0 | 327,203 | 0 |
Impairment of long-lived assets | 0 | 121,350 | 0 |
Impairment of investment | 0 | 2,472 | 0 |
Non-cash loss on OR Laser dissolution | 5,291 | 0 | 0 |
Deferred income taxes | (50,594) | (24,471) | (14,930) |
Amortization of debt issuance cost | 3,479 | 3,321 | 4,647 |
Stock-based compensation | 41,405 | 44,787 | 36,466 |
Non-cash restructuring charges | 5,637 | 2,194 | 12,609 |
Amortization of right of use assets | 19,190 | 16,033 | 0 |
Non-cash pension impact | 265 | 2,134 | (8,931) |
Other non-cash expense (gain) | 1,055 | (2,571) | 421 |
Changes in assets and liabilities, net of effect of acquisitions: | |||
Accounts receivable | (28,667) | 53,104 | 82,078 |
Inventories | 28,993 | 28,464 | 17,805 |
Prepaid expenses and other assets | (9,677) | (2,631) | 14,074 |
Other long-term assets | 1,935 | (2,733) | (549) |
Accounts payable | 42,499 | 8,187 | (15,160) |
Income taxes payable/receivable | 32,565 | (25,024) | (119,929) |
Operating lease liabilities | (19,036) | (15,964) | 0 |
Other current liabilities | 54,444 | (985) | (13,155) |
Other long-term liabilities | (4,066) | 9,343 | 15,745 |
Net cash provided by operating activities | 72,938 | 206,907 | 181,401 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (82,563) | (64,919) | (83,283) |
Proceeds from dispositions of property and equipment | 3,209 | 21,926 | 5,294 |
Purchases of available-for-sale securities | 0 | (77,359) | (11,552) |
Proceeds from sales and maturities of available-for-sale securities | 35,311 | 42,168 | 11,552 |
Acquisition of businesses, net of cash acquired | (28,810) | 0 | (18,881) |
Investment at cost | 0 | 0 | (3,423) |
Net cash used in investing activities | (72,853) | (78,184) | (100,293) |
Cash flows from financing activities: | |||
Short-term borrowings | 0 | 12,695 | 119,594 |
Long-term borrowings | 28,885 | 0 | 0 |
Repayments of short-term borrowings | (1,874) | (14,474) | (111,794) |
Repayments of long-term borrowings | (8,563) | (7,920) | (7,537) |
Issuance of common stock under employee stock option and purchase plans | 12,483 | 13,362 | 11,811 |
Repurchase of common stock | 0 | 0 | (77,410) |
Net settlement of restricted common stock | (10,362) | (13,549) | (15,179) |
Net cash provided (used in) financing activities | 20,569 | (9,886) | (80,515) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (3,653) | 8,022 | (5,977) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 17,001 | 126,859 | (5,384) |
Cash, cash equivalents and restricted cash, beginning of year | 445,520 | 318,661 | 324,045 |
Cash, cash equivalents and restricted cash, end of year | 462,521 | 445,520 | 318,661 |
Cash paid during the year for: | |||
Interest | 14,581 | 13,716 | 14,475 |
Income taxes | 30,336 | 33,617 | 156,650 |
Cash received during the year for: | |||
Income taxes | 19,875 | 10,933 | 23,416 |
Noncash investing and financing activities: | |||
Unpaid property and equipment purchases | 4,137 | 2,896 | 4,406 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | |||
Cash and cash equivalents | 456,534 | 440,258 | 305,833 |
Restricted cash, current | 1,527 | 765 | 792 |
Restricted cash, non-current | 4,460 | 4,497 | 12,036 |
Total cash, cash equivalents, and restricted cash shown in the consolidated statement of cash flows | $ 462,521 | $ 445,520 | $ 318,661 |
Description of Business (Notes)
Description of Business (Notes) | 12 Months Ended |
Oct. 02, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | DESCRIPTION OF BUSINESSFounded in 1966, Coherent, Inc. provides lasers, laser-based technologies and laser-based system solutions in a broad range of commercial, industrial and scientific research applications. Coherent designs, manufactures, services, and markets lasers and related accessories for a diverse group of customers. Headquartered in Santa Clara, California, the Company has worldwide operations including research and development, manufacturing, sales, service, and support capabilities. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Oct. 03, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Significant Accounting Policies | SIGNIFICANT ACCOUNTING POLICIES Fiscal Year Our fiscal year ends on the Saturday closest to September 30. Fiscal years 2021, 2020, and 2019 ended on October 2, 2021, October 3, 2020, and September 28, 2019, respectively, and are referred to in these financial statements as fiscal 2021, fiscal 2020, and fiscal 2019 for convenience. Fiscal 2021 and 2019 each included 52 weeks and fiscal 2020 included 53 weeks. The fiscal years of several of our international subsidiaries end on September 30. Accordingly, the financial statements of these subsidiaries as of that date and for the years then ended have been used for our consolidated financial statements. Management believes that the impact of the use of different year-ends is immaterial to our consolidated financial statements taken as a whole. Use of Estimates The preparation of consolidated financial statements in conformity with Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Basis of Presentation The consolidated financial statements include the accounts of Coherent, Inc. and its direct and indirect subsidiaries (collectively, the "Company," "we," "our," "us" or "Coherent"). Intercompany balances and transactions have been eliminated. Business Combinations We include the results of operations of the businesses that we acquire as of the respective dates of acquisition. We allocate the fair value of the purchase price of our business acquisitions to the tangible assets acquired, liabilities assumed, and intangible assets acquired, based on their estimated fair values. The excess of the purchase price over the fair values of these identifiable assets and liabilities is recorded as goodwill. On April 19, 2021, we acquired Electro-Optics Technology, Inc. ("EOT") and its subsidiary in Germany. The significant accounting policies of EOT have been aligned to conform to those of Coherent, and the consolidated financial statements include the results of EOT as of its acquisition date. Fair Value of Financial Instruments The carrying amounts of certain of our financial instruments including accounts receivable, accounts payable, and accrued liabilities approximate fair value due to their short maturities. Short-term investments are comprised of available-for-sale securities, which are carried at fair value. Other non-current assets include trading securities and life insurance contracts related to our deferred compensation plans; trading securities are carried at fair value and life insurance contracts are carried at cash surrender values, which due to their ability to be converted to cash at that amount, approximate their fair values. Foreign exchange contracts are stated at fair value based on prevailing financial market information. Short-term and long-term debt is carried at amortized cost, which approximates its fair value based on borrowing rates currently available to us for loans with similar terms. Cash Equivalents All highly liquid investments with maturities of three months or less at the time of purchase are classified as cash equivalents. At fiscal 2021 year-end, cash and cash equivalents included cash, money market funds, and time deposits. Concentration of Credit Risk Financial instruments that may potentially subject us to concentrations of credit risk consist principally of cash equivalents, short-term investments, and accounts receivable. At fiscal 2021 year-end, all of our short-term investments were in cash and cash equivalents. Cash equivalents and short-term investments are maintained with several financial institutions and may exceed the amount of insurance provided on such balances. At October 2, 2021, we held cash and cash equivalents and short-term investments outside the U.S. in certain of our foreign operations totaling approximately $310.6 million, $291.7 million of which was denominated in currencies other than the U.S. Dollar. The majority of our accounts receivable are derived from sales to customers for commercial applications. We perform ongoing credit evaluations of our customers' financial condition and limit the amount of credit extended when deemed necessary but generally require no collateral. In certain instances, we may require customers to issue a letter of credit. We maintain reserves for potential credit losses. Our products are broadly distributed and there was one customer who accounted for 17.8% and 24.2% of accounts receivable at fiscal 2021 and fiscal 2020 year-end, respectively. Derivative Financial Instruments Our primary objective for holding derivative financial instruments is to manage currency exchange rate risk. Principal currencies hedged include the Euro, South Korean Won, Japanese Yen, Chinese Renminbi, Singapore Dollar, British Pound, Malaysian Ringgit, Swiss Franc, Canadian Dollar, Swedish Krona, Taiwan Dollar, and Vietnamese Dong. Our derivative financial instruments are recorded at fair value, on a gross basis, and are included in other current assets and other current liabilities. Our accounting policies for derivative financial instruments are based on whether they meet the criteria for designation as a cash flow hedge. If we have any that meet this criteria, changes in the fair value of these cash flow hedges that are highly effective are recorded in accumulated other comprehensive income and reclassified into earnings in the same line item on the consolidated statements of operations as the impact of the hedged transaction during the period in which the hedged transaction affects earnings. The ineffective portion of cash flow hedges are recognized immediately in other income and expenses. Derivatives that we designate as cash flow hedges are classified in the consolidated statements of cash flows in the same section as the underlying item, primarily within cash flows from operating activities. The changes in fair value of derivative instruments that are not designated as hedges are recognized immediately in other income (expense). We formally document all relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions. This process includes linking all derivatives that are designated as cash-flow hedges to specific forecasted transactions. We also assess, both at the hedge's inception and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flows of the hedged items. Accounts Receivable Allowances Accounts receivable allowances reflect our best estimate of probable losses inherent in our accounts receivable balances, including both losses for uncollectible accounts receivable and sales returns. We regularly review allowances by considering factors such as historical experience, credit quality, the age of the accounts receivable balances, and current economic conditions that may affect a customer's ability to pay. Activity in accounts receivable allowance is as follows (in thousands): Fiscal 2021 2020 2019 Beginning balance $ 7,630 $ 8,690 $ 4,568 Additions charged to expenses 1,261 2,630 5,210 Deductions from reserves (2,286) (3,690) (1,088) Ending balance $ 6,605 $ 7,630 $ 8,690 Inventories Inventories are stated at the lower of cost (first-in, first-out or weighted average cost) or net realizable value. Inventories are as follows (in thousands): Fiscal year-end 2021 2020 Purchased parts and assemblies $ 107,965 $ 116,957 Work-in-process 168,775 173,871 Finished goods 115,501 135,928 Total inventories $ 392,241 $ 426,756 Property and Equipment Property and equipment are stated at cost and are depreciated or amortized using the straight-line method. Cost, accumulated depreciation and amortization, and estimated useful lives are as follows (dollars in thousands): Fiscal year-end 2021 2020 Useful Life Land $ 19,002 $ 19,576 Buildings and improvements 213,698 169,748 5-40 years Equipment, furniture and fixtures 401,391 364,376 3-10 years Leasehold improvements 76,987 72,474 shorter of asset life or lease term 711,078 626,174 Accumulated depreciation and amortization (408,465) (380,496) Property and equipment, net $ 302,613 $ 245,678 In fiscal 2020, we completed a sale-leaseback transaction for our Hamburg, Germany facility. See Note 11, "Leases" for further discussion. Asset Retirement Obligations The fair value (the present value of estimated cash flows) of a liability for an asset retirement obligation is recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The fair value of the liability is added to the carrying amount of the associated asset and this additional carrying amount is depreciated over the life of the asset. All of our existing asset retirement obligations are associated with commitments to return the property to its original condition upon lease termination at various sites and costs to clean up and dispose of certain fixed assets at our Sunnyvale, California site. We estimated that as of fiscal 2021 year-end, gross expected future cash flows of $6.8 million would be required to fulfill these obligations. The following table reconciles changes in our asset retirement liability for fiscal 2021 and 2020 (in thousands): Asset retirement liability as of September 28, 2019 $ 5,074 Reduction to asset retirement obligations (32) Adjustments and additions to asset retirement obligations recognized 813 Accretion recognized 161 Changes due to foreign currency exchange 163 Asset retirement liability as of October 3, 2020 6,179 Reduction to asset retirement obligations (248) Adjustments and additions to asset retirement obligations recognized 305 Additional asset retirement obligations due to acquisition 16 Accretion recognized 149 Changes due to foreign currency exchange (9) Asset retirement liability as of October 2, 2021 $ 6,392 At October 2, 2021, $0.4 million and $6.0 million of the asset retirement liability were included in Other current liabilities and Other long-term liabilities, respectively, on our consolidated balance sheets. At October 3, 2020, $0.3 million and $5.9 million of the asset retirement liability were included in Other current liabilities and Other long-term liabilities, respectively, on our consolidated balance sheets. Long-lived Assets We evaluate the carrying value of long-lived assets, including intangible assets, whenever events or changes in business circumstances or our planned use of long-lived assets indicate that their carrying amounts may not be fully recoverable or that their useful lives are no longer appropriate. Reviews are performed to determine whether the carrying values of long-lived assets are impaired based on a comparison to the undiscounted expected future net cash flows. If the comparison indicates that impairment exists, long-lived assets that are classified as held and used are written down to their respective fair values. When long-lived assets are classified as held for sale, they are written down to their respective fair values less costs to sell. Significant management judgment is required in the forecast of future operating results that is used in the preparation of expected undiscounted cash flows. For fiscal 2020, we recorded non-cash pre-tax charges in the quarter ended April 4, 2020 related to the intangible assets, property, plant and equipment, and right-of-use ("ROU") assets of the ILS reporting unit of $33.9 million, $85.6 million, and $1.8 million, respectively (See Note 8, "Goodwill and Intangible Assets"). Goodwill Goodwill is tested for impairment on an annual basis and between annual tests in certain circumstances, and written down when impaired (See Note 8, "Goodwill and Intangible Assets"). In testing for impairment, we have the option to first assess qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount. Moreover, an entity can bypass the qualitative assessment for any reporting unit in any period and proceed directly to the impairment test, and then resume performing the qualitative assessment in any subsequent period. In our fiscal 2021 annual testing, for our OLS reporting unit we conducted a qualitative assessment of the goodwill during the fourth quarter using the opening balance sheet as of the first day of the fourth quarter and concluded that it was more likely than not that the fair value of the reporting unit exceeded its carrying amounts. Based on our assessment, goodwill in the OLS reporting unit was not impaired as of the first day of the fourth quarter of fiscal 2021. As such, it was not necessary to perform the goodwill impairment test in the fourth quarter of fiscal 2021. There is no goodwill in the ILS reporting unit due to the impairment of all goodwill of the ILS reporting unit in the second quarter of fiscal 2020. Intangible Assets Intangible assets, including acquired existing technology, customer relationships and production know-how are amortized on a straight-line basis over their estimated useful lives, currently 4 years to 15 years (See Note 8, "Goodwill and Intangible Assets"). Warranty Reserves We provide warranties on the majority of our product sales and reserves for estimated warranty costs are recorded during the period of sale. The determination of such reserves requires us to make estimates of product return rates and expected costs to repair or replace the products under warranty. We currently establish warranty reserves based on historical warranty costs for each product line. The weighted average warranty period covered is approximately 15 months to 18 months. If actual return rates and/or repair and replacement costs differ significantly from our estimates, adjustments to cost of sales may be required in future periods. Components of the reserve for warranty costs during fiscal 2021, 2020, and 2019 were as follows (in thousands): Fiscal 2021 2020 2019 Beginning balance $ 35,032 $ 36,460 $ 40,220 Additions related to current period sales 31,655 37,788 52,271 Warranty costs incurred in the current period (35,781) (40,724) (54,538) Accruals resulting from acquisitions 170 — 21 Adjustments to accruals related to foreign exchange and other (19) 1,508 (1,514) Ending balance $ 31,057 $ 35,032 $ 36,460 Loss Contingencies We are subject to the possibility of various loss contingencies arising in the ordinary course of business. We consider the likelihood of loss or impairment of an asset, or the incurrence of a liability, as well as our ability to reasonably estimate the amount of loss, in determining loss contingencies. An estimated loss contingency is accrued when it is probable that an asset has been impaired or a liability has been incurred and the amount of loss can be reasonably estimated. If we determine that a loss is possible and the range of the loss can be reasonably determined, then we disclose the range of the possible loss. We regularly evaluate current information available to us to determine whether an accrual is required, an accrual should be adjusted or a range of possible loss should be disclosed. Revenue Recognition Effective September 30, 2018, we adopted ASU 2014-09, Revenue from Contracts with Customers ("ASC 606"), using the modified retrospective transition method applied to contracts that were not completed as of September 29, 2018. Under ASC 606, we determine revenue recognition by applying the following five-step approach: Step 1 Identification of the contract, or contracts, with a customer; Step 2 Identification of the performance obligations in the contract; Step 3 Determination of the transaction price; Step 4 Allocation of the transaction price to the performance obligations in the contract; and Step 5 Recognition of revenue when, or as, we satisfy each performance obligation. Contracts and customer purchase orders, which in some cases are governed by master sales agreements, are generally used to determine the existence of an arrangement. In addition, shipping documents and customer acceptance, if applicable, are used to verify delivery and transfer of control. Performance obligations are identified based on the products or services that will be transferred to the customer that are considered distinct. Being distinct is defined as products or services that the customer can benefit from either on its own or together with other resources that are readily available from third parties or from us, and by the product or service being separately identifiable from other promises in the contract. We assess our ability to collect from our customers based primarily on the creditworthiness and past payment history of each customer. Revenue from all sales are recognized at the transaction price. The transaction price is determined based on the consideration to which we will be entitled in exchange for transferring goods or services to the customer adjusted for estimated variable consideration, if any. The consideration associated with customer contracts is generally fixed. Variable consideration includes discounts, rebates, credits and incentives, or other similar items. The amount of consideration that can vary is not a substantial portion of the total consideration. Variable consideration estimates are re-assessed at each reporting period until a final outcome is determined. Changes to the original transaction price due to a change in estimated variable consideration are calculated on a retrospective basis, with the adjustment recorded in the period in which the change occurs. Sales to customers are generally not subject to any price protection or return rights. Accordingly, upon application of steps one through five above, product revenue is recognized upon shipment and transfer of control. The majority of products and services offered by us have readily observable selling prices. As a part of our stand-alone selling price policy, we review product pricing on a periodic basis to identify any significant changes and revise our expected selling price assumptions as appropriate. We record taxes collected on revenue-producing activities on a net basis. Revenue recognition at a point in time Revenues recognized at a point in time consist primarily of product, installation and training. The majority of our sales are made to original equipment manufacturers ("OEMs"), distributors, representatives and end-users. Sales made to customers generally do not require installation of the products by us and are not subject to other post-delivery obligations. Sales to end-users in the scientific market typically require installation by us and, thus, involve post-delivery obligations; however, our post-delivery installation obligations are not essential to the functionality of our products and represent a separate performance obligation. We recognize revenue for these sales following the transfer of control of such products to the customer, which typically occurs upon shipment or delivery depending on the terms of the underlying contracts. In those instances that we have agreed to perform installation or provide training, we defer revenue related to installation or training until these services have been rendered. Our sales to distributors, representatives and end-user customers typically do not have customer acceptance provisions and only certain of our sales to OEM customers and integrators have customer acceptance provisions. Customer acceptance is generally limited to performance under our published product specifications. For the few product sales that have customer acceptance provisions because of more advanced performance than our published specifications, the revenue is recognized when the control transfers or the revenue is deferred until customer acceptance occurs. Revenue recognition over time We periodically enter into contracts in which a customer may purchase a combination of goods and/or services, such as products with maintenance contracts or extended warranty. These contracts are evaluated to determine if the multiple promises are separate performance obligations. Once we determine the performance obligations, we then determine the transaction price, which includes estimating the amount of variable consideration, if any. We then allocate the transaction price to each performance obligation in the contract based on a relative stand-alone selling price charged separately to customers. Extended warranties are sold separately from products and represent a distinct performance obligation. Revenue related to the performance obligation for extended warranties is recognized over time as the customer simultaneously receives and consumes the benefits provided by us. Customized products, for which we have an enforceable right to payment for performance completed to date, are recorded over time. We use the output method to recognize revenue over time for such contracts as it best depicts the satisfaction of our performance obligations. Shipping and handling costs We record costs related to shipping and handling of net sales in cost of sales for all periods presented. Shipping and handling fees billed to customers are included in net sales. Customs duties billed to customers are recorded in cost of sales. Warranty We provide warranties on the majority of our product sales and reserves for estimated warranty costs are recorded during the period of sale. These standard warranties are assurance type warranties and do not offer any services beyond the assurance that the product will continue working as specified. Therefore, these warranties are not considered separate performance obligations in the arrangement. Instead, the expected cost of the warranty is accrued as an expense. The determination of such reserves requires us to make estimates of product return rates and expected costs to repair or replace the products under warranty. We currently establish warranty reserves based on historical warranty costs for each product line. The weighted average warranty period covered is approximately 15 to 18 months. If actual return rates and/or repair and replacement costs differ significantly from our estimates, adjustments to cost of sales may be required in future periods. Costs of obtaining a contract We recognize the incremental direct costs of obtaining a contract from a customer as an expense, which primarily includes sales commissions. Sales commissions are recorded at a point of time when control of the product transfers or over a period of time when sales commission provided is expected to be recovered through future services. The costs are recorded within selling, general and administrative expense. Costs incurred prior to the transfer of control of the product to the customer and costs to be amortized over a future period are classified as a prepaid asset and are included in prepaid expenses and other assets. Upon adoption of ASC 606, we determined there was an immaterial impact on sales commissions and therefore, we did not record a transition adjustment on adoption. For fiscal 2021 and 2020, costs of obtaining a contract to be amortized over a future period of $0.2 million and $0.3 million were classified as a prepaid asset and are included in prepaid expenses and other assets, respectively. Payment terms Our standard payment terms are 30 days but vary by the industry and location of the customer and the products or services offered. The time between invoicing and when payment is due is not significant. As our standard payment terms are less than one year, we have elected the practical expedient under ASC 606-10-32-18 and therefore are not required to assess whether each contract has a significant financing component. Customer deposits and deferred revenue When we receive consideration from a customer prior to transferring goods or services under the terms of a sales contract, we record customer deposits or deferred revenue, depending on whether or not the product has shipped to the customer, which are included in other current liabilities or other long-term liabilities when the payment is made or due, whichever is earlier. We recognize deferred revenue as net sales after control of the goods or services has been transferred to the customer and all revenue recognition criteria are met. Research and Development Research and development expenses include salaries, contractor and consultant fees, supplies and materials, as well as costs related to other overhead such as depreciation, facilities, utilities and other departmental expenses. The costs we incur with respect to internally developed technology and engineering services are included in research and development expenses as incurred as they do not directly relate to any particular licensee, license agreement or license fee. We treat third party and government funding of our research and development activity, where we are the primary beneficiary of such work conducted, as a reduction of research and development cost. Research and development reimbursements of $2.1 million, $3.4 million, and $3.8 million were offset against research and development costs in fiscal 2021, 2020, and 2019, respectively. Foreign Currency Translation The functional currencies of our foreign subsidiaries are generally their respective local currencies. Accordingly, gains and losses from the translation of the financial statements of the foreign subsidiaries are reported as a separate component of accumulated other comprehensive income ("OCI"). Foreign currency transaction gains and losses are included in earnings. Comprehensive Income (Loss) Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. Accumulated other comprehensive income (loss) (net of tax) at fiscal 2021 year-end was substantially comprised of accumulated translation adjustments of $20.4 million and deferred actuarial losses on pension plans of $0.4 million. Accumulated other comprehensive loss (net of tax) at fiscal 2020 year-end was substantially comprised of accumulated translation adjustments of $25.1 million and deferred actuarial losses on pension plans of $0.5 million. Earnings Per Share Basic earnings per share is computed based on the weighted average number of shares outstanding during the period, excluding unvested restricted stock. Diluted earnings per share is computed based on the weighted average number of shares outstanding during the period increased by the effect of dilutive employee stock awards, including restricted stock awards and stock purchase plan contracts, using the treasury stock method. The following table presents information necessary to calculate basic and diluted earnings per share (in thousands, except per share data): Fiscal 2021 2020 2019 Weighted average shares outstanding—basic 24,390 24,105 24,118 Dilutive effect of employee stock awards — — 161 Weighted average shares outstanding—diluted 24,390 24,105 24,279 Net income (loss) $ (106,751) $ (414,139) $ 53,825 For fiscal 2021 and 2020, all potentially dilutive securities have been excluded from the dilutive share calculation as we reported a net loss. There were 98,103 potentially dilutive securities excluded from the dilutive share calculation for fiscal 2019 as their effect was anti-dilutive. Stock-Based Compensation We recognize compensation expense for all share-based payment awards based on the fair value of such awards. We value restricted stock units using the intrinsic value method, which is based on the fair market value price on the grant date. We use a Monte Carlo simulation model to estimate the fair value of performance restricted stock units whose number of units vesting is based on our total shareholder return over the performance period compared to the Russell Index. In fiscal 2020, we valued certain performance restricted stock units with vesting based on goals related to free cash flow target amounts units using the intrinsic value method, which is based on the fair market value price on the grant date. We amortize the fair value of stock awards on a straight-line basis over the requisite service periods of the awards, which are generally the vesting periods. See Note 12, "Employee Stock Award and Benefit Plans" for a description of our stock-based employee compensation plans and the assumptions we use to calculate the fair value of stock-based employee compensation. Income Taxes As part of the process of preparing our consolidated financial statements, we are required to estimate our income tax provision (benefit) in each of the jurisdictions in which we operate. This process involves us estimating our current income tax provision (benefit) together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included within our consolidated balance sheets. We account for uncertain tax issues pursuant to ASC 740-10 Income Taxes , which creates a single model to address accounting for uncertainty in tax positions by prescribing a minimum recognition threshold that a tax position is required to meet before being recognized in the financial statements. This standard provides a two-step approach for evaluating tax positions. The first step, recognition, occurs when a company concludes (based solely on the technical aspects of the matter) that a tax position is more likely than not to be sustained upon examination by a taxing authority. The second step, measurement, is only considered after step one has been satisfied and measures any tax benefit at the largest amount that is deemed more likely than not to be realized upon ultimate settlement of the uncertainty. These determinations involve significant judgment by management. Tax positions that fail to qualify for initial recognition are recognized in the first subsequent interim period that they meet the more likely than not standard or when they are resolved through negotiation or litigation with factual interpretation, judgment and certainty. Tax laws and regulations themselves are complex and are subject to change as a result of changes in fiscal policy, changes in legislation, evolution of regulations and court filings. Therefore, the actual liability for U.S. or foreign taxes may be materially different from our estimates, which could result in the need to record additional tax liabilities or potentially to reverse previously recorded tax liabilities. We record a valuation allowance to reduce our deferred tax assets to an amount that more likely than not will be realized. While we have considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the valuation allowance, in the event we were to determine that we would be able to realize our deferred tax assets in the future in excess of our net recorded amount, an adjustment to the allowance for the deferred tax asset would increase income in the period such determination was made. Likewise, should we determine that we would not be able to realize all or part of our net deferred tax asset in the future, an adjustment to the allowance for the deferred tax asset would be charged to income in the period such determination was made. We historically asserted our intention to indefinitely reinvest foreign earnings. As a result of enactment of the Tax Cuts and Jobs Act (the “Tax Act”) and certain foreign tax law changes, we no longer consider foreign earnings to be indefinitely reinvested in our foreign subsidiaries. As a result of this change in assertion, we recorded a $18.4 million tax expense against our foreign earnings that are not indefinitely reinvested as of fiscal 2021. This is mainly related to foreign withholding taxes and state income taxes. We have not recognized any deferred taxes for outside basis differences in foreign subsidiaries. Adoption of New Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and a subsequent amendment, ASU 2018-19 (collectively, "Topic 326"). Topic 326 requires measurement and recognition of expected credi |
Revenue Recognition (Notes)
Revenue Recognition (Notes) | 12 Months Ended |
Oct. 02, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | REVENUE RECOGNITION Disaggregation of Revenue Based on the information that our chief operating decision maker ("CODM") uses to manage the business, we disaggregate revenue by type and market application within each segment. No other level of disaggregation is required considering the type of products, customers, markets, contracts, duration of contracts, timing of transfer of control, and sales channels. The following tables summarize revenue from contracts with customers (in thousands): Sales by revenue type and segment Fiscal 2021 2020 2019 OEM Laser Sources Industrial Lasers & Systems OEM Laser Sources Industrial Lasers & Systems OEM Laser Sources Industrial Lasers & Systems Net sales: Products (1) $ 550,690 $ 465,002 $ 441,476 $ 369,342 $ 532,863 $ 430,878 Other product and service revenues (2) 362,946 108,830 317,453 100,728 353,813 113,086 Total net sales $ 913,636 $ 573,832 $ 758,929 $ 470,070 $ 886,676 $ 543,964 (1) Net sales primarily recognized at a point in time. (2) Includes sales of spare parts, related accessories, and other consumable parts as well as revenues from service agreements, of which $67.4 million for fiscal 2021 was recognized over time. Sales by market application and segment Fiscal 2021 2020 2019 OEM Laser Sources Industrial Lasers & Systems OEM Laser Sources Industrial Lasers & Systems OEM Laser Sources Industrial Lasers & Systems Net sales: Microelectronics $ 551,032 $ 113,503 $ 466,780 $ 71,755 $ 568,387 $ 63,789 Precision manufacturing 56,074 342,975 36,129 299,621 38,017 366,861 Instrumentation 292,561 81,514 234,078 66,243 258,624 79,741 Aerospace and defense 13,969 35,840 21,942 32,451 21,648 33,573 Total net sales $ 913,636 $ 573,832 $ 758,929 $ 470,070 $ 886,676 $ 543,964 See Note 18, "Segment and Geographic Information" for revenue disaggregation by reportable segment and geographic region. Contract Balances We record accounts receivable when we have an unconditional right to the consideration. Contract liabilities are recorded when cash payments are received or due in advance of performance. Contract liabilities consist of customer deposits and deferred revenue, where we have unsatisfied or partly satisfied performance obligations. Contract liabilities classified as customer deposits are included in other current liabilities and contract liabilities classified as deferred revenue are included in other current liabilities or other long-term liabilities on our consolidated balance sheets. Payment terms vary by customer. A rollforward of our customer deposits and deferred revenue are as follows (in thousands): Fiscal year-end 2021 2020 Beginning balance $ 56,339 $ 42,550 Amount of customer deposits and deferred revenue recognized in income (217,835) (171,521) Additions to customer deposits and deferred revenue 226,959 183,604 Translation adjustments (59) 1,706 Ending balance $ 65,404 $ 56,339 Remaining performance obligations represent the transaction price allocated to performance obligations that are unsatisfied or partially unsatisfied as of the end of the reporting period. The following table includes estimated revenue expected to be recognized in the future related to performance obligations for sales of maintenance agreements, extended warranties, installation, and contracts with customer acceptance provisions included in customer deposits and deferred revenue as follows (in thousands): 1 year Thereafter Total Performance obligations as of October 2, 2021 $ 49,445 $ 15,959 $ 65,404 |
Business Combinations
Business Combinations | 12 Months Ended |
Oct. 02, 2021 | |
Business Combinations [Abstract] | |
Business Combinations | BUSINESS COMBINATIONS Merger Agreement On January 18, 2021, we entered into an Agreement and Plan of Merger with Lumentum Holdings Inc. ("Lumentum"), Cheetah Acquisition Sub, Inc. ("Lumentum Merger Sub I") and Cheetah Acquisition Sub LLC ("Lumentum Merger Sub II") (the "Original Lumentum Merger Agreement"), pursuant to which we agreed to be acquired for $100.00 in cash per Coherent share and 1.1851 shares of Lumentum common stock per Coherent share. In light of unsolicited proposals received from each of MKS Instruments, Inc. and II-VI Incorporated ("II-VI"), on March 9, 2021, we entered into an Amended and Restated Agreement and Plan of Merger with Lumentum, Lumentum Merger Sub I and Lumentum Merger Sub II (the "Amended Lumentum Agreement"), pursuant to which we agreed to be acquired for $175.00 in cash per Coherent share and 1.0109 shares of Lumentum common stock per Coherent share. On March 25, 2021, we terminated the Amended Lumentum Agreement and entered into an Agreement and Plan of Merger with II-VI and Watson Merger Sub Inc. ("II-VI Merger Sub") (the "II-VI Merger Agreement"), pursuant to which we agreed to be acquired for $220.00 in cash per Coherent share and 0.91 of a share of II-VI common stock per Coherent share. In connection with terminating the Amended Lumentum Agreement, we paid a termination fee of $217.6 million to Lumentum during our second quarter of fiscal 2021. The termination fee, in addition to other costs related to the merger agreements with Lumentum and II-VI, is included in merger and acquisition costs in our consolidated statements of operations. Pursuant to the terms of the II-VI Merger Agreement, the acquisition of Coherent will be accomplished through a merger of II-VI Merger Sub with and into Coherent (the "Merger"), with Coherent surviving the Merger as a wholly owned subsidiary of II-VI. Pursuant to the terms of the II-VI Merger Agreement, and subject to the terms and conditions set forth therein, at the effective time of the Merger (the "Effective Time"), each share of the common stock of Coherent (the "Coherent Common Stock") issued and outstanding immediately prior to the Effective Time (other than (x) shares of Coherent Common Stock owned by II-VI, Coherent, or any direct or indirect wholly owned subsidiary of II-VI or Coherent or (y) shares of Coherent Common Stock owned by stockholders who have properly exercised and perfected appraisal rights under Delaware law, in each case, immediately prior to the Effective Time), will be cancelled and extinguished and automatically converted into the right to receive the following consideration: (A) $220.00 in cash, without interest, plus (B) 0.91 of a validly issued, fully paid and non-assessable share of the common stock of II-VI. The completion of Coherent's acquisition by II-VI is subject to customary closing conditions, including, among others, regulatory approvals in applicable jurisdictions including the United States, Germany, China and South Korea. Electro-Optics Technology On April 19, 2021, we acquired EOT for approximately $29.3 million, excluding transaction costs. EOT is a specialized U.S.-based components company, which we expect will enable us to vertically integrate and improve the performance of our directed energy amplifier technology. EOT has additional operations through a subsidiary in Germany. EOT's operating results have been included in our OEM Laser Sources segment. See Note 18, "Segment and Geographic Information." Our allocation of the purchase price is as follows (in thousands): Tangible assets: Cash $ 537 Accounts receivable 1,763 Inventories 5,269 Prepaid expenses and other assets 823 Property and equipment 18,713 Liabilities assumed (1,856) Deferred tax liabilities (4,088) Intangible assets: Existing technology 2,800 In-process research and development 300 Customer relationships 300 Trademarks 100 Backlog 100 Goodwill 4,586 Total $ 29,347 Results of operations for the business have been included in our consolidated financial statements subsequent to the date of acquisition and have not been presented separately because the effect of the acquisition was not material to our consolidated financial results. Pro forma results of operations in accordance with authoritative guidance for prior periods have not been presented because the effect of the acquisition was not material to our prior period consolidated financial results. The identifiable intangible assets are being amortized over their respective useful lives of 1 to 5 years. The fair value of the acquired intangibles was determined using the income approach. In performing these valuations, the key underlying probability-adjusted assumptions of the discounted cash flows were projected revenues, gross margin expectations and operating cost estimates. The valuations were based on the information that was available as of the acquisition date and the expectations and assumptions that have been deemed reasonable by our management. There are inherent uncertainties and management judgment required in these determinations. This acquisition resulted in a purchase price that exceeded the estimated fair value of tangible and intangible assets, which was allocated to goodwill. We believe the amount of goodwill relates to several factors including: (1) potential buyer-specific synergies in connection with the development of new technologies primarily for the defense business; and (2) the potential to leverage our sales force to attract new customers and revenue and cross-sell to existing customers. None of the goodwill from this purchase is deductible for tax purposes. We expensed $0.4 million of acquisition-related costs as merger and acquisition costs in our consolidated statements of operations in fiscal 2021. Fiscal 2019 Acquisitions Ondax On October 5, 2018, we acquired privately held Ondax for approximately $12.0 million, excluding transaction costs. Ondax developed and produced photonic components which are used on an OEM basis by the laser industry as well as incorporated into its own stabilized lasers and Raman Spectroscopy systems. Ondax’s operating results have been included in our Industrial Lasers & Systems segment. See Note 18, "Segment and Geographic Information." Our allocation of the purchase price is as follows (in thousands): Tangible assets: Cash $ 103 Accounts receivable 534 Inventories 1,793 Prepaid expenses and other assets 17 Deferred tax assets 681 Property and equipment 122 Liabilities assumed (499) Intangible assets: Existing technology 5,600 Customer relationships 300 Goodwill 3,333 Total $ 11,984 Results of operations for the business have been included in our consolidated financial statements subsequent to the date of acquisition and pro forma results of operations in accordance with authoritative guidance for prior periods have not been presented because the effect of the acquisition was not material to our prior period consolidated financial results. The identifiable intangible assets are being amortized over their respective useful lives of 1 to 8 years. The fair values of the acquired intangibles were determined using the income approach. In performing these valuations, the key underlying probability-adjusted assumptions of the discounted cash flows were projected revenues, gross margin expectations and operating cost estimates. The valuations were based on the information that was available as of the acquisition date and the expectations and assumptions that have been deemed reasonable by our management. There are inherent uncertainties and management judgment required in these determinations. This acquisition resulted in a purchase price that exceeded the estimated fair value of tangible and intangible assets, which was allocated to goodwill. We believe the amount of goodwill relative to identifiable intangible assets relates to several factors including: (1) potential buyer-specific synergies related to the development of new technologies; and (2) the potential to leverage our sales force to attract new customers. In the quarter ended April 4, 2020, we performed an interim impairment test and the entire goodwill balance and a portion of the existing technology intangible assets were impaired. See Note 8, "Goodwill and Intangible Assets". None of the goodwill from this purchase is deductible for tax purposes. Quantum On October 5, 2018, we acquired certain assets of Quantum Coating, Inc. ("Quantum") for approximately $7.0 million, excluding transaction costs, and accounted for the transaction as an asset purchase. Our allocation of the purchase price is as follows (in thousands): Tangible assets: Property and equipment $ 2,770 Intangible assets: Existing technology 1,600 Customer relationships 230 Production know-how 2,300 Backlog 100 Total $ 7,000 The identifiable intangible assets are being amortized over their respective useful lives of 1 to 5 years. The fair values of the acquired intangibles were determined using the income approach. In performing these valuations, the key underlying probability-adjusted assumptions of the discounted cash flows were projected revenues, gross margin expectations and operating cost estimates. The valuations were based on the information that was available as of the acquisition date and the expectations and assumptions that have been deemed reasonable by our management. There are inherent uncertainties and management judgment required in these determinations. |
Fair Values
Fair Values | 12 Months Ended |
Oct. 02, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Values | FAIR VALUES We measure our cash equivalents and marketable securities at fair value. The fair values of our financial assets and liabilities are determined using quoted market prices of identical assets or quoted market prices of similar assets from active markets. We recognize transfers between levels within the fair value hierarchy, if any, at the end of each quarter. There were no transfers between levels during the periods presented. As of October 2, 2021 and October 3, 2020, we had one investment carried on a cost basis. See Note 9, "Balance Sheet Details." If we were to fair value this investment, it would be based upon Level 3 inputs. This investment is not considered material to our consolidated financial statements. We measure the fair value of outstanding debt obligations for disclosure purposes on a recurring basis. As of October 2, 2021, the current and long-term portion of long-term obligations of $8.4 million and $425.8 million, respectively, are reported at amortized cost. As of October 3, 2020, the current and long-term portion of long-term obligations of $6.8 million and $411.1 million, respectively, are reported at amortized cost. These outstanding obligations are classified as Level 2 as they are not actively traded and are valued using a discounted cash flow model that uses observable market inputs. Based on the discounted cash flow model, the fair value of the outstanding debt approximates amortized cost. Financial assets and liabilities measured at fair value as of October 2, 2021 and October 3, 2020 are summarized below (in thousands): Aggregate Fair Value Quoted Prices Significant Aggregate Fair Value Quoted Prices Significant Fiscal year-end 2021 Fiscal year-end 2020 (Level 1) (Level 2) (Level 1) (Level 2) Assets: Cash equivalents: Money market fund deposits $ 112,748 $ 112,748 $ — $ 36,646 $ 36,646 $ — Certificates of deposit 42,506 42,506 — 56,191 56,191 — Short-term investments: U.S. Treasury and agency obligations (1) — — — 35,346 — 35,346 Prepaid and other assets: Foreign currency contracts (2) 783 — 783 812 — 812 Money market fund deposits — Deferred comp and supplemental plan (3) 463 463 — 203 203 — Mutual funds — Deferred comp and supplemental plan (3) 15,443 15,443 — 22,778 22,778 — Total $ 171,943 $ 171,160 $ 783 $ 151,976 $ 115,818 $ 36,158 Liabilities: Other current liabilities: Foreign currency contracts (2) (4,253) — (4,253) (2,811) — (2,811) Total $ 167,690 $ 171,160 $ (3,470) $ 149,165 $ 115,818 $ 33,347 ___________________________________________________ (1) Valuations are based upon quoted market prices in active markets involving similar assets. The market inputs used to value these instruments generally consist of market yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Pricing sources include industry standard data providers, security master files from large financial institutions, and other third party sources which are input into a distribution-curve-based algorithm to determine a daily market value. This creates a "consensus price" or a weighted average price for each security. (2) The principal market in which we execute our foreign currency contracts is the institutional market in an over-the-counter environment with a relatively high level of price transparency. The market participants usually are large commercial banks. Our foreign currency contracts' valuation inputs are based on quoted prices and quoted pricing intervals from public data sources and do not involve management judgment. See Note 7, "Derivative Instruments and Hedging Activities." |
Short-Term Investments
Short-Term Investments | 12 Months Ended |
Oct. 02, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Short-Term Investments | SHORT-TERM INVESTMENTS We consider all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents. Investments classified as available-for-sale are reported at fair value with unrealized gains and losses, net of related income taxes, recorded as a separate component of OCI in stockholders' equity until realized. Interest and amortization of premiums and discounts for debt securities are included in interest income. Gains and losses on securities sold are determined based on the specific identification method and are included in other income (expense). Cash, cash equivalents and short-term investments consist of the following (in thousands): Fiscal 2021 year-end Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents $ 456,534 $ — $ — $ 456,534 Fiscal 2020 year-end Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents $ 440,258 $ — $ — $ 440,258 Short-term investments: Available-for-sale securities: U.S. Treasury and agency obligations $ 35,311 $ 36 $ (1) $ 35,346 Total short-term investments $ 35,311 $ 36 $ (1) $ 35,346 There were no unrealized gains and losses at October 2, 2021. There were less than $0.1 million of unrealized gains and losses at October 3, 2020. During fiscal 2021, there were no proceeds from the sale of available-for-sale securities and we realized no gross gains or losses. During fiscal 2020, we received $5,000 in proceeds from the sale of available-for-sale securities and realized no gross gains or losses. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 12 Months Ended |
Oct. 02, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIESWe maintain operations in various countries outside of the United States and have foreign subsidiaries that manufacture and sell our products in various global markets. The majority of our sales are transacted in U.S. Dollars. However, we do generate revenues in other currencies, primarily the Euro, Chinese Renminbi, South Korean Won, Japanese Yen, and British Pound. As a result, our earnings, cash flows, and cash balances are exposed to fluctuations in foreign currency exchange rates. We attempt to limit these exposures through financial market instruments. We utilize derivative instruments, primarily forward contracts with maturities of two months or less, to manage our exposure associated with anticipated cash flows and net asset and liability positions denominated in foreign currencies. Gains and losses on the forward contracts are mitigated by gains and losses on the underlying instruments. We do not use derivative financial instruments for speculative or trading purposes. The credit risk amounts represent our gross exposure to potential accounting loss on derivative instruments that are outstanding or unsettled if all counterparties failed to perform according to the terms of the contract, based on then-current currency rates at each respective date. Non-Designated Derivatives The total outstanding notional contract and fair value asset (liability) amounts of non-designated hedge contracts, with maximum maturity of two months, are as follows (in thousands): U.S. Notional Contract Value U.S. Fair Value Fiscal 2021 year-end Fiscal 2020 year-end Fiscal 2021 year-end Fiscal 2020 year-end Foreign currency hedge contracts Purchase $ 236,943 $ 169,206 $ (4,108) $ (1,802) Sell $ (64,308) $ (166,813) $ 638 $ (197) The fair value of our derivative instruments is included in prepaid expenses and other assets and in other current liabilities in our Consolidated Balance Sheets. See Note 5, "Fair Values." During fiscal 2021, 2020, and 2019, we recognized a loss of $5.1 million, a gain of $1.1 million, and a loss of $5.8 million, respectively, in other income (expense) for derivative instruments not designated as hedging instruments. Master Netting Arrangements |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Oct. 02, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | GOODWILL AND INTANGIBLE ASSETS Goodwill is tested for impairment on an annual basis and between annual tests if events or circumstances indicate that an impairment loss may have occurred, and we write down these assets when impaired. We perform our annual impairment tests during the fourth quarter of each fiscal year using the opening balance sheet as of the first day of the fourth quarter, with any resulting impairment recorded in the fourth quarter of the fiscal year. In the quarter ended April 4, 2020, the worldwide spread of coronavirus ("COVID-19") created significant volatility, uncertainty and disruption to the global economy, representing an indicator to test our goodwill for impairment. Based on our internal projections and the preparation of our financial statements for the quarter ended April 4, 2020, and considering the forecasted decrease in demand due to the COVID-19 pandemic and other factors, we believed that the fair value of our ILS reporting unit might no longer have exceeded its carrying value and performed an interim goodwill impairment test on the ILS reporting unit. We also performed an interim goodwill impairment test on the OLS reporting unit. Our goodwill impairment tests for the ILS and OLS reporting units were performed by comparing the fair value of the reporting units with their carrying values and recognizing an impairment charge for the amount by which the carrying value exceeded the fair value. Based on the estimated fair value of the ILS reporting unit, in the quarter ended April 4, 2020, we recorded a non-cash pre-tax charge related to the ILS reporting unit of $327.2 million, reducing the goodwill balance of the reporting unit to zero. The impairment charge was primarily the result of a decline in projected cash flows of the ILS reporting unit driven by lower forecasted sales volumes and profitability in several business units. The impairment charge was also the result of changes in certain market-related inputs to the analysis to reflect macro-economic changes caused by the impact of COVID-19, including lower pricing multiples for comparable public companies. No impairment charge was recognized for the OLS reporting unit as the fair value significantly exceeded the carrying value of the reporting unit. In assessing goodwill for impairment, we were required to make significant judgments related to the fair value of our reporting units. We used a combination of the Income (discounted cash flow) approach and the Market (market comparable) approach to estimate the fair value of our reporting units. The Income approach utilizes the discounted cash flow model to provide an estimation of fair value based on the cash flows that a business expects to generate. These cash flows are based on forecasts developed internally by management which are then discounted at an after tax rate of return required by equity and debt market participants of a business enterprise. Our assumptions used in the forecasts are based on historical data, supplemented by current and anticipated market conditions, estimated growth rates, and management’s plans. The rate of return on cost of capital is weighted based on the capitalization of comparable companies. We utilized a discount rate for each of our reporting units that represents the risks that our businesses face, considering their sizes, their current economic environment and other industry data as we believe is appropriate. The Market approach determines fair value by comparing the reporting units to comparable companies in similar lines of business that are publicly traded. The selection of comparable companies is based on the markets in which the reporting units operate giving consideration to risk profiles, size, geography and diversity of products and services. Total Enterprise Value (TEV) multiples such as TEV to revenues and TEV to earnings (if applicable) before interest and taxes of the publicly traded companies are calculated. We utilized multiples for each of our reporting units that represent the risks that our businesses face, considering their sizes, their current economic environment and other industry data as we believe is appropriate. The interim goodwill impairment testing results were also reconciled with our market capitalization as of April 4, 2020, as the final step in the impairment testing. Before performing the goodwill impairment test for the ILS reporting unit, we performed impairment tests on the long-lived assets allocated to the asset group of the ILS reporting unit, including intangible assets, property, plant and equipment, and ROU assets as of April 4, 2020, due primarily to the same indicators that led to the interim goodwill impairment testing. Based on the impairment tests performed, we concluded that some of the long-lived assets allocated to the asset group of the ILS reporting unit were impaired as of April 4, 2020. Accordingly, we recorded non-cash pre-tax charges in the quarter ended April 4, 2020 related to the intangible assets, property, plant and equipment, and right-of-use ("ROU") assets of the ILS reporting unit of $33.9 million, $85.6 million, and $1.8 million, respectively. We did not identify any indicators that would lead us to believe that the carrying value of the long-lived assets allocated to the asset group of the OLS reporting unit may not be recoverable as of April 4, 2020. We evaluate long-lived assets and amortizable intangible assets whenever events or changes in business circumstances or our planned use of assets indicate that their carrying amounts may not be fully recoverable or that their useful lives are no longer appropriate. In assessing our long-lived assets for impairment, we were required to make significant judgments related to the fair value of our long-lived assets, which are comprised of personal property, real property, and intangible assets. We used a combination of the Income, the Market approach, and the Cost (cost to create) approach to estimate the fair value of our long-lived assets. Our personal property assets consist of laser manufacturing and assembly equipment, semiconductor tools, laboratory and test equipment, furniture and fixtures, and computer hardware and software. We used the Cost Approach (with support from the Market Approach) to estimate the fair value of our personal property, taking into consideration the physical deterioration, functional obsolescence, and economic obsolescence of our personal property assets. Our real property assets consist of land and buildings, land rights (ground leased), and ROU assets. In determining the fair value of our real property assets, we used a combination of the Income, Market (sales comparison), and Cost approaches. We considered historical transaction information, current market conditions, operating performance, forecast growth, and market-derived rates of return in our real property determination of fair value. The fair value of our ROU assets was determined using the Income approach by considering off-market components of the associated ROU leases. Our intangible assets consist of technology and customer relationship assets, and we used the Income approach to estimate the fair value of our intangible assets. We identified cash flows associated with each intangible asset, which were discounted at an after-tax rate of return appropriate for the risk profile of each intangible asset. We performed our annual impairment test using the opening balance sheet as of the first day of the fourth quarter of fiscal 2020 and noted no indications of impairment or triggering events, not already considered in the quarter ended April 4, 2020. During the remainder of fiscal 2020 and the first three quarters of fiscal 2021, we noted no indications of impairment or triggering events to cause us to review goodwill for potential impairment. We performed our annual impairment test using the opening balance sheet as of the first day of the fourth quarter of fiscal 2021 and noted no indications of impairment or triggering events. In our fiscal 2021 annual testing, for our OLS reporting unit we conducted a qualitative assessment of the goodwill during the fourth quarter using the opening balance sheet as of the first day of the fourth quarter and concluded that it was more likely than not that the fair value of the reporting unit exceeded its carrying amounts. Based on our assessment, goodwill in the OLS reporting unit was not impaired as of the first day of the fourth quarter of fiscal 2021. As such, it was not necessary to perform the goodwill impairment test in the fourth quarter of fiscal 2021. There is no goodwill in the ILS reporting unit due to the impairment of all goodwill of the ILS reporting unit in the second quarter of fiscal 2020. Between the completion of our assessment and the end of the fourth quarter of fiscal 2021, we noted no indications of impairment or triggering events to cause us to review goodwill for potential impairment. The changes in the carrying amount of goodwill by segment for fiscal 2021 and 2020 are as follows (in thousands): Industrial Lasers & System OEM Laser Sources Total Balance as of September 28, 2019 $ 330,281 $ 96,820 $ 427,101 Impairment charges (327,203) — (327,203) Translation adjustments (3,078) 4,497 1,419 Balance as of October 3, 2020 — 101,317 101,317 Additions — 4,586 4,586 Translation adjustments — (642) (642) Balance as of October 2, 2021 $ — $ 105,261 $ 105,261 The components of our amortizable intangible assets are as follows (in thousands): Fiscal year-end 2021 Fiscal year-end 2020 Gross Accumulated Net Gross Accumulated Net Existing technology $ 39,524 $ (35,522) $ 4,002 $ 46,547 $ (37,630) $ 8,917 Customer relationships 22,101 (12,586) 9,515 24,388 (12,923) 11,465 Production know-how 2,300 (1,377) 923 2,300 (917) 1,383 In-process research and development 300 — 300 — — — Total $ 64,225 $ (49,485) $ 14,740 $ 73,235 $ (51,470) $ 21,765 For accounting purposes, when an intangible asset is fully amortized, it is removed from the disclosure schedule. The net carrying amounts as of both fiscal 2021 and 2020 have been reduced by impairment charges of $27.7 million and $6.2 million for existing technology and customer relationships, respectively. The weighted average remaining amortization periods for existing technology, customer relationships, and production know-how are approximately 3.0 years, 5.1 years, and 2.0 years, respectively. Amortization expense for intangible assets during fiscal 2021, 2020, and 2019 was $10.7 million, $30.1 million, and $61.5 million, respectively. The change in accumulated amortization also includes $0.7 million (decrease) and $2.9 million (increase) of foreign exchange impact for fiscal 2021 and fiscal 2020, respectively. Estimated amortization expense for the next five fiscal years and all years thereafter are as follows (in thousands): Estimated 2022 $ 3,978 2023 3,407 2024 2,625 2025 2,306 2026 1,969 Thereafter 155 Total (1) $ 14,440 (1) Excluding in-process research & development. |
Balance Sheet Details
Balance Sheet Details | 12 Months Ended |
Oct. 02, 2021 | |
Balance Sheet Related Disclosures [Abstract] | |
Balance Sheet Details | BALANCE SHEET DETAILS Prepaid expenses and other assets consist of the following (in thousands): Fiscal year-end 2021 2020 Prepaid and refundable income taxes $ 34,979 $ 50,548 Other taxes receivable 15,568 13,006 Prepaid expenses and other assets 29,047 24,696 Total prepaid expenses and other assets $ 79,594 $ 88,250 Other assets consist of the following (in thousands): Fiscal year-end 2021 2020 Assets related to deferred compensation arrangements (see Note 12) $ 37,410 $ 39,720 Deferred tax assets (see Note 16) 153,685 102,028 Right of use assets, net - operating leases (See Note 11) 76,670 85,905 Right of use assets, net - finance leases (See Note 11) 26 656 Other assets (1) 14,780 14,266 Total other assets $ 282,571 $ 242,575 (1) We have an investment included in other assets that is being carried on a cost basis and is adjusted for impairment if we determine that indicators of impairment exist at any point in time. During the second quarter of fiscal 2020, we determined that our investment became impaired and wrote it down to its fair value ($0.9 million). As a result, we recorded a non-cash impairment charge of $2.5 million to operating expense in our results of operations in the second quarter of fiscal 2020. Other current liabilities consist of the following (in thousands): Fiscal year-end 2021 2020 Accrued payroll and benefits $ 101,380 $ 54,211 Operating lease liability, current (see Note 11) 15,230 15,366 Finance lease liability, current (see Note 11) 22 399 Accrued expenses and other 41,156 36,432 Warranty reserve (see Note 2) 31,057 35,032 Customer deposits 19,364 9,717 Deferred revenue 30,081 32,998 Total other current liabilities $ 238,290 $ 184,155 Other long-term liabilities consist of the following (in thousands): Fiscal year-end 2021 2020 Long-term taxes payable $ 17,634 $ 15,374 Operating lease liability, long-term (see Note 11) 65,479 75,264 Finance lease liability, long-term (see Note 11) — 178 Deferred compensation (see Note 12) 39,693 42,854 Deferred tax liabilities (see Note 16) 19,356 15,721 Deferred revenue 15,959 13,624 Asset retirement obligations liability (see Note 2) 5,991 5,892 Defined benefit plan liabilities (see Note 17) 44,110 45,810 Other long-term liabilities 4,508 6,357 Total other long-term liabilities $ 212,730 $ 221,074 |
Borrowings
Borrowings | 12 Months Ended |
Oct. 02, 2021 | |
Short-term Debt [Abstract] | |
Borrowings | BORROWINGS On December 21, 2020, Coherent LaserSystems GmbH & Co. KG entered into a loan agreement with Commerzbank for borrowings of up to 24.0 million Euros, to be drawn down by October 29, 2021, to finance a portion of the construction of a new facility in Germany. The term of the loan is 10 years and borrowings bear interest at 1.55% per annum. Payments will be payable quarterly beginning in the third quarter of fiscal 2022. As of October 2, 2021, 24.0 million Euros have been withdrawn under this loan facility. The loan agreement contains customary affirmative loan covenants. We were in compliance with all covenants at October 2, 2021. On November 7, 2016 (the "Closing Date"), we entered into a Credit Agreement by and among us, Coherent Holding BV & Co. K.G. (formerly Coherent Holding GmbH), as borrower (the "Borrower"), and certain of our direct and indirect subsidiaries from time to time party thereto, as guarantors, the lenders from time to time party thereto, Barclays Bank PLC, as administrative agent and an L/C Issuer, Bank of America, N.A., as an L/C Issuer, and MUFG Union Bank, N.A., as an L/C Issuer (the "Initial Credit Agreement" and, as amended by the Amendments (defined below), the "Credit Agreement"). The Initial Credit Agreement provided for a 670.0 million Euro senior secured term loan facility (the "Euro Term Loan") and a $100.0 million senior secured revolving credit facility (the "Revolving Credit Facility") with a $30.0 million letter of credit sublimit and a $10.0 million swing line sublimit, in each case, which may be increased from time to time pursuant to an incremental feature set forth in the Credit Agreement. The Initial Credit Agreement was amended on May 8, 2017 (the "First Amendment") to reduce the interest rate margins applicable to the Euro Term Loan and was amended again on July 5, 2017 (the "Second Amendment" and, together with the First Amendment, the "Amendments") to make certain technical changes in connection with the conversion of the Borrower from a German company with limited liability to a German limited partnership. The Credit Agreement contains customary mandatory prepayment provisions. The Borrower has the right to prepay loans under the Credit Agreement in whole or in part at any time without premium or penalty, subject to customary breakage costs. Revolving loans may be borrowed, repaid and reborrowed until the fifth anniversary of the Closing Date, at which time all outstanding revolving loans must be repaid. The Euro Term Loan matures on the seventh anniversary of the Closing Date (in the first quarter of fiscal 2024), at which time all outstanding principal and accrued and unpaid interest on the Euro Term Loan must be repaid. As of October 2, 2021, the outstanding principal amount of the Euro Term Loan was 351.5 million Euros. As of October 2, 2021, the outstanding amount of the Revolving Credit Facility was $10.0 million plus a 10.0 million Euro letter of credit. On October 29, 2021, we entered into a 10.0 million Euro letter of credit facility, rolled our existing letter of credit into that facility and deposited 10.5 million Euros with Barclays as cash collateral to secure the payment obligations under such facility, resulting in restricted cash of $12.2 million. On October 29, 2021, we repaid the $10.0 million outstanding under the Revolving Credit Facility and the facility expired on November 5, 2021. Loans under the Credit Agreement bear interest, at the Borrower's option, at a rate equal to either (i)(x) in the case of calculations with respect to U.S. Dollars or certain other alternative currencies, the London interbank offered rate ("LIBOR") or (y) in the case of calculations with respect to the Euro, the euro interbank offered rate ("EURIBOR" and, together with LIBOR), (the "Eurocurrency Rate") or (ii) a base rate (the "Base Rate") equal to the highest of (x) the federal funds rate, plus 0.50%, (y) the prime rate then in effect and (z) the Eurocurrency Rate for loans denominated in U.S. Dollars applicable to a one-month interest period, plus 1.0%, in each case, plus an applicable margin that is subject to adjustment pursuant to a pricing grid based on consolidated total gross leverage ratio. At October 2, 2021, the applicable margin for Euro Term Loans borrowed as Eurocurrency Rate loans was 2.25% per annum and as Base Rate loans was 1.25%. The applicable margin for revolving loans borrowed as Eurocurrency Rate loans was 4.00% per annum and as Base Rate loans was 3.00% per annum. Interest on Base Rate Loans is payable quarterly in arrears. Interest on Eurocurrency Rate loans is payable at the end of the applicable interest period (or at three month intervals if the interest period exceeds three months). The Credit Agreement requires the Borrower to make scheduled quarterly payments on the Euro Term Loan of 0.25% of the original principal amount of the Euro Term Loan, with any remaining principal payable at maturity. A commitment fee accrues on any unused portion of the revolving loan commitments under the Credit Agreement at a rate of 0.375% or 0.5% depending on the consolidated total gross leverage ratio at any time of determination. The Borrower is also obligated to pay other customary fees for a credit facility of this size and type. On the Closing Date, we and certain of our direct and indirect subsidiaries, as guarantors, provided an unconditional guaranty of all obligations of the Borrower and the other loan parties arising under the Credit Agreement, the other loan documents and under swap contracts and treasury management agreements with the lenders or their affiliates (with certain limited exceptions). The Borrower and the guarantors have also granted security interests in substantially all of their assets to secure such obligations. The Credit Agreement contains customary affirmative and negative covenants, including covenants limiting the ability of us and our subsidiaries to, among other things, incur debt, grant liens, make investments, make certain restricted payments, transact with affiliates, and sell assets. The Credit Agreement also requires us and our subsidiaries to maintain a senior secured net leverage ratio as of the last day of each fiscal quarter of less than or equal to 3.50 to 1.00. We were in compliance with all covenants at October 2, 2021. We incurred $28.5 million of debt issuance costs related to the Euro Term Loan and $0.5 million of debt issuance costs to the original lenders related to the First Amendment, which are included in short-term borrowings and current portion of long-term obligations and long-term obligations in the consolidated balance sheets and will be amortized to interest expense over the seven year life of the Euro Term Loan using the effective interest method, adjusted to accelerate amortization related to voluntary repayments. We incurred $2.3 million of debt issuance costs in connection with the Revolving Credit Facility which were capitalized and included in prepaid expenses and other assets in the consolidated balance sheets and will be amortized to interest expense using the straight-line method over the contractual term of five years of the Revolving Credit Facility. Additional sources of cash available to us were international currency lines of credit and bank credit facilities totaling $15.0 million as of October 2, 2021, of which $13.1 million was unused and available. These unsecured international credit facilities were used in Europe in fiscal 2021. As of October 2, 2021, we had utilized $1.9 million of the international credit facilities as guarantees in Europe. Short-term borrowings and current portion of long-term obligations consist of the following (in thousands): Fiscal year-end 2021 2020 Current portion of Euro Term Loan (1) $ 4,972 $ 4,970 1.3% Term loan due 2024 1,448 1,465 1.0% State of Connecticut term loan due 2023 386 382 Facility construction loan in Germany due 2030 1,589 — Line of credit borrowings 10,000 10,000 Total short-term borrowings and current portion of long-term obligations $ 18,395 $ 16,817 (1) Net of debt issuance costs of $2.8 million and $2.9 million at October 2, 2021 and October 3, 2020, respectively. Long-term obligations consist of the following (in thousands): Fiscal year-end 2021 2020 Euro Term Loan due 2024 (1) $ 396,429 $ 406,099 1.3% Term loan due 2024 2,896 4,395 1.0% State of Connecticut term loan due 2023 260 646 Facility construction loan in Germany due 2030 26,215 — Total long-term obligations $ 425,800 $ 411,140 ( 1) Net of debt issuance costs of $3.0 million and $5.9 million at October 2, 2021 and October 3, 2020, respectively. Contractual maturities of our debt obligations, excluding line of credit borrowings, as of October 2, 2021 are as follows (in thousands): Amount 2022 $ 11,183 2023 12,649 2024 396,314 2025 3,178 2026 3,178 Thereafter 13,505 Total $ 440,007 |
Leases
Leases | 12 Months Ended |
Oct. 02, 2021 | |
Leases [Abstract] | |
Leases | LEASES We determine if an arrangement contains a lease at inception for arrangements with an initial term of more than 12 months, and classify it as either a finance or operating lease. We lease certain real and personal property from unrelated third parties under non-cancellable operating leases that expire at various dates through fiscal 2029. These operating leases are mainly for administrative offices, research-and-development, and manufacturing facilities, as well as sales offices in various countries around the world. Certain leases require us to pay property taxes, insurance, and routine maintenance, and include escalation clauses. Many leases include one or more options to renew. We assume renewals in our determination of the lease term when the renewals are deemed to be reasonably assured at lease commencement. We have also entered into various finance leases to obtain servers and certain other equipment for our operations. These arrangements are typically for three As the rates implicit in our leases are not readily determinable, we use incremental borrowing rates based on the information available at the commencement date in determining the present value of future lease payments. We consider both the credit rating and the length of the lease when calculating the incremental borrowing rate. We combine lease and non-lease components into a single lease component for both our operating and finance leases. For the purpose of lease liability measurement, we consider only payments that are fixed and determinable at the time of commencement. Any variable payments that depend on an index or rate are expensed as incurred. We generally recognize sublease income on a straight-line basis over the sublease term. As a result of interim impairment testing performed on long-lived assets in the quarter ended April 4, 2020, we recorded non-cash pre-tax charges related to the ROU assets of the ILS reporting unit of $1.8 million in the quarter ended April 4, 2020. See Note 8, "Goodwill and Intangible Assets" for discussion of the interim impairment testing. In fiscal 2020, we completed a sale-leaseback transaction for our Hamburg, Germany facility in which we sold the buildings for a purchase price, net of expenses, of $19.6 million and leased back a portion of the facilities with lease terms from 6 to 15 years with early termination provisions after 3 and 5 years, respectively. The sale qualified for sale-leaseback operating lease accounting classification and we recorded a gain, net of selling costs, on the transaction of $2.2 million, which is recorded in selling, general and administrative expense in the consolidated statements of operations in fiscal 2020. We also recorded operating lease right of use assets of $5.1 million and corresponding operating lease liabilities of $5.1 million. The non-cash portion of the gain of $4.0 million is included in Other non-cash expense (gain) within cash flows from operations in our consolidated statements of cash flows in fiscal 2020. The components of operating lease costs (in thousands), lease term (in years) and discount rate are as follows: Fiscal 2021 2020 Operating lease cost $ 22,601 $ 19,629 Variable lease cost 1,329 1,421 Short-term lease cost 52 459 Sublease income (9) (126) Total lease cost $ 23,973 $ 21,383 Fiscal year-end 2021 2020 Weighted average remaining lease term 7.3 7.8 Weighted average discount rate 5.0 % 4.9 % Supplemental cash flow information related to leases are as follows (in thousands): Fiscal 2021 2020 Operating cash outflows from operating leases $ 22,667 $ 19,391 ROU assets obtained in exchange for new operating lease liabilities 11,565 10,884 See Note 9, "Balance Sheet Details" for supplemental balance sheet information related to leases. As of October 2, 2021, maturities of our operating lease liabilities, which do not include short-term leases and variable lease payments are as follows (in thousands): Operating Leases 2022 $ 18,279 2023 16,546 2024 14,304 2025 11,718 2026 8,978 2027 and thereafter 29,702 Total minimum lease payments 99,527 Amounts representing interest (18,818) Present value of total operating lease liabilities $ 80,709 |
Employee Stock Award and Benefi
Employee Stock Award and Benefit Plans | 12 Months Ended |
Oct. 02, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Employee Stock Award and Benefit Plans | EMPLOYEE STOCK AWARD AND BENEFIT PLANS Deferred Compensation Plans Under our deferred compensation plans ("plans"), eligible employees are permitted to make compensation deferrals up to established limits set under the plans and accrue income on these deferrals based on reference to changes in available investment options. While not required by the plans, we choose to invest in insurance contracts and mutual funds in order to approximate the changes in the liability to the employees. These investments and the liability to the employees were as follows (in thousands): Fiscal year-end 2021 2020 Cash surrender value of life insurance contracts $ 23,040 $ 18,520 Fair value of mutual and money market funds 15,906 22,981 Total assets $ 38,946 $ 41,501 Total assets, included in: Prepaid expenses and other assets $ 1,536 $ 1,781 Other assets 37,410 39,720 Total assets $ 38,946 $ 41,501 Fiscal year-end 2021 2020 Total deferred compensation liability, included in: Other current liabilities $ 1,536 $ 1,781 Other long-term liabilities 39,693 42,854 Total deferred compensation liability $ 41,229 $ 44,635 Life insurance premiums loads, policy fees, and cost of insurance that are paid from the asset investments and gains and losses from the asset investments for these plans are recorded as components of other income or expense; such amounts were net gains of $9.8 million in fiscal 2021, $6.1 million in fiscal 2020, and $1.1 million in fiscal 2019, and fluctuate on a quarterly basis. Changes in the obligation to plan participants are recorded as a component of operating expenses and cost of sales; such amounts were net losses of $8.9 million in fiscal 2021, $5.3 million in fiscal 2020, and $1.5 million in fiscal 2019, and fluctuate on a quarterly basis. Liabilities associated with participant balances under our deferred compensation plans are affected by individual contributions and distributions made, as well as gains and losses on the participant's investment allocation election. Coherent Employee Retirement and Investment Plan Under the Coherent Employee Retirement and Investment Plan, we match employee contributions to the plan up to a maximum of 4% of the employee's individual earnings subject to IRS limitations. Employees become eligible for participation and Company matching contributions on their first day of employment. The Company's contributions (net of forfeitures) during fiscal 2021, 2020, and 2019 were $6.2 million, $6.1 million, and $5.7 million, respectively. Employee Stock Purchase Plan We have an Employee Stock Purchase Plan ("ESPP") whereby eligible employees may authorize payroll deductions of up to 10% of their regular base salary to purchase shares at the lower of 85% of the fair market value of the common stock on the date of commencement of the offering or on the last day of the six-month offering period. During fiscal 2021, 2020, and 2019, a total of 120,023 shares, 107,284 shares, and 108,034 shares, respectively, were purchased by and distributed to employees at an average price of $104.00, $114.54, and $109.32 per share, respectively. At fiscal 2021 year-end, we had 273,442 shares of our common stock reserved for future issuance under the plan. Stock Award Plans We maintain stock plans in which employees, service providers, and non-employee directors are eligible participants. The plans, the 2011 Equity Incentive Plan (the "2011 Plan") and the Equity Incentive Plan (the "2020 Plan"), provide for a number of different equity-based grants, including options, time-based restricted stock units, and performance restricted stock units. Under the 2011 Plan, Coherent was able to grant options and awards (time-based restricted stock units and performance restricted stock units), of which grants with respect to 270,371 shares of common stock remained outstanding at fiscal 2021 year-end (calculated at 100% of target amount for performance awards). Under the 2020 Plan, Coherent may grant options and awards (time-based restricted stock units and performance restricted stock units) to purchase up to 3,080,000 shares of common stock plus any forfeited or cancelled shares subject to outstanding awards under the 2011 Plan, of which 2,347,532 shares remained available for grant at fiscal 2021 year-end. At fiscal 2021 year-end, all outstanding stock options and restricted stock units have been issued under plans approved by our shareholders. Following approval of the 2020 Plan by our shareholders on April 27, 2020, no further grants of awards under the 2011 Equity Incentive Plan were made. However, the 2011 Equity Incentive Plan will continue to govern awards previously granted under it. Since adoption of the 2011 Plan and the 2020 Plan, no stock options have been granted to employees. No options are outstanding as of fiscal 2021 year-end. Non-employee directors are automatically granted time-based restricted stock units upon first joining the Board of Directors and then upon reelection. New non-employee directors initially receive an award of restricted stock units valued at approximately $225,000 which vest over a two year period. The annual grant for non-employee directors is a value of approximately $225,000 in shares of restricted stock units that vest on February 15 of the calendar year following the grant. Restricted stock awards and restricted stock units are typically subject to vesting restrictions—either time-based, market-based or performance-based conditions for vesting. Until restricted stock vests, shares (including those issuable upon vesting of the applicable restricted stock unit) are generally subject to forfeiture if employment or service to the Company terminates prior to the release of restrictions and cannot be transferred. • The service-based restricted stock awards generally vest within three years from the date of grant. • The service-based restricted stock unit awards are generally subject to annual vesting over three years from the date of grant, though from time-to-time, depending upon exceptional circumstances, the Company has granted restricted stock unit awards with one or two year vesting. For example, the initial grants made to new members of the Board of Directors vest over two years and members of the Board of Directors have annual grants tied to their reelection to the Board, which vest on the following February 15. • The market-based performance restricted stock unit award grants are generally subject to a single vest measurement three years from the date of grant, depending upon achievement of performance measurements based on the performance of the Company's total shareholder returns (as defined in the award) over the performance period compared with the performance of the applicable Russell Index or companies therein (or as otherwise determined by the Compensation and HR Committee). • The performance restricted stock unit award grants based on goals related to free cash flow target amounts for fiscal 2020 vested as of fiscal 2020 year-end. We recognize compensation expense for all share-based payment awards based on the fair value of such awards. The expense is recognized on a straight-line basis per tranche over the respective requisite service period of the awards. Determining Fair Value Employee Stock Purchase Plan Valuation and amortization method —We estimate the fair value of employee stock purchase shares using the Black-Scholes-Merton option-pricing formula. This fair value is then amortized on a straight-line basis over the purchase period. Expected Term —The expected term represents the period of our employee stock purchase plan. Expected Volatility —Our process for computing expected volatility considers both historical volatility and market-based implied volatility; however our estimate of expected forfeitures is based on historical employee data and could differ from actual forfeitures. Risk-Free Interest Rate —The risk-free interest rate used in the Black-Scholes-Merton valuation method is based on the implied yield currently available on U.S. Treasury zero-coupon issues with an equivalent remaining term. The fair values of shares purchased under the employee stock purchase plan for fiscal 2021, 2020, and 2019 were estimated using the following weighted-average assumptions: Employee Stock Purchase Plans Fiscal 2021 2020 2019 Expected life in years 0.5 0.5 0.5 Expected volatility 52.6 % 58.0 % 47.9 % Risk-free interest rate 0.1 % 1.0 % 2.4 % Weighted average fair value per share $ 55.64 $ 43.54 $ 40.77 Time-Based Restricted Stock Units Time-based restricted stock units are fair valued at the closing market price on the date of grant. Performance Restricted Stock Units We grant performance restricted stock units to officers and certain employees. The performance restricted stock unit agreements provide for the award of performance stock units with each unit representing the right to receive one share of our common stock to be issued after the applicable award vesting period. The final number of units awarded, if any, for these performance grants will be determined as of the vesting dates, based upon our total shareholder return over the performance period compared to the applicable Russell Index or companies therein and could range from no units to a maximum of twice the initial award units. The weighted average fair value for the performance units was determined using a Monte Carlo simulation model incorporating the following weighted average assumptions: Fiscal 2021 2020 2019 Risk-free interest rate 0.2 % 0.8 % 2.9 % Volatility 51.7 % 50.5 % 43.7 % Weighted average fair value $ 119.54 $ 161.46 $ 117.43 We recognize the estimated cost of these awards, as determined under the simulation model, over the related service period of approximately 3 years, with no adjustment in future periods based upon the actual shareholder return over the performance period. In addition, during fiscal 2020, we granted performance restricted stock unit award grants to certain employees with vesting based on goals related to free cash flow target amounts, with the initial fair value determined based on our closing stock price on the date of grant. Such awards were granted to serve as a performance incentive with a pay-for-performance forward-looking free cash flow target for the fiscal year in recognition of the impact of the COVID-19 pandemic. The number of shares issuable under these performance units upon satisfaction of the free cash flow performance criteria was capped at 100% of target. The total stock-based compensation of these awards was adjusted based on the level of achievement of free cash flow. These awards vested, in the first quarter of fiscal 2021, at 100% of target. Stock Compensation Expense The following table shows total stock-based compensation expense and related tax benefits included in the Consolidated Statements of Operations for fiscal 2021, 2020, and 2019 (in thousands): Fiscal 2021 2020 2019 Cost of sales $ 7,675 $ 5,314 $ 4,880 Research and development 4,463 4,478 2,990 Selling, general and administrative 29,267 34,995 28,596 Income tax benefit (5,387) (5,640) (4,946) $ 36,018 $ 39,147 $ 31,520 During fiscal 2021, $7.0 million of stock-based compensation cost was capitalized as part of inventory for all stock plans, $7.7 million was amortized into cost of sales, and $2.1 million remained in inventory at October 2, 2021. During fiscal 2020, $6.7 million of stock-based compensation cost was capitalized as part of inventory for all stock plans, $5.3 million was amortized into cost of sales, and $2.8 million remained in inventory at October 3, 2020. At fiscal 2021 year-end, the total compensation cost related to unvested stock-based awards granted to employees under our stock plans but not yet recognized was approximately $47.6 million. We do not estimate forfeitures and account for them as they occur. This cost will be amortized on a straight-line basis over a weighted-average period of approximately 1.4 years. The stock option exercise tax benefits, if any, are reported in the statement of cash flows. The tax benefits result from tax deductions in excess of the stock-based compensation cost recognized and are determined on a grant-by-grant basis. We recognized net excess tax benefits from stock award exercises and restricted stock unit vesting as a discrete tax benefit, which reduced the provision for income taxes by $0.7 million, $0.9 million, and $2.5 million for fiscal 2021, 2020, and 2019, respectively. Stock Awards Activity At fiscal 2019 year-end, we had 24,000 shares subject to vested stock options outstanding. The vested stock options were exercised in fiscal 2020 and none are outstanding at fiscal 2020 or 2021 year-end. The following table summarizes the activity of our time-based and performance restricted stock units for fiscal 2021, 2020, and 2019 (in thousands, except per share amounts): Time Based Restricted Stock Units Performance Restricted Stock Units Number of Weighted Number of Weighted Nonvested stock at September 29, 2018 279 $ 155.24 159 $ 155.76 Granted 195 128.25 105 117.43 Vested (1) (169) 127.90 (131) 74.48 Forfeited (10) 170.97 — — Nonvested stock at September 28, 2019 295 $ 152.47 133 $ 184.26 Granted 284 141.05 84 152.96 Vested (1) (150) 150.91 (81) 163.17 Forfeited (10) 169.92 — — Nonvested stock at October 3, 2020 419 $ 144.87 136 $ 177.54 Granted 294 136.46 64 119.43 Vested (1) (229) 144.32 (12) 118.45 Forfeited (13) 134.64 (30) 315.05 Nonvested stock at October 2, 2021 471 $ 140.16 158 $ 131.90 __________________________________________ (1) Service-based restricted stock units vested during each fiscal year. Performance-based restricted stock units are included at 100% of target goal. Under the terms of the market-based awards, the recipient may earn between 0% and 200% of the award. Under the terms of the fiscal 2020 performance-based awards based on free cash flow targets, the recipient may earn between 0% and 100% of the award. Restricted stock units are converted into the right to receive common stock upon vesting; prior to issuance, the Company permits the employee holders to satisfy their tax withholding requirements by net settlement, whereby the Company withholds a portion of the shares to cover the applicable taxes based on the fair market value of the Company's stock at the vesting date. The number of shares withheld to cover tax payments was 80,605 in fiscal 2021, 88,000 in fiscal 2020, and 120,000 in fiscal 2019; tax payments made were $10.4 million, $13.5 million, and $15.2 million, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Oct. 02, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Indemnifications In the normal course of business, we enter into agreements that contain a variety of representations and warranties and provide for general indemnification. Exposure under these agreements is unknown because claims may be made against us in the future and we may record charges in the future as a result of these indemnification obligations. As of October 2, 2021, we did not have any material indemnification claims that were probable or reasonably possible. Commitments We maintain commitments to purchase inventory from our suppliers as well as fixed assets, services and other assets in the ordinary course of business. As of October 2, 2021, we had total estimated significant purchase commitments for inventory of approximately $63.8 million and significant purchase obligations for fixed assets and services of $50.6 million. Legal Proceedings We are subject to legal claims and litigation arising in the ordinary course of business, such as contract-related, product sales and servicing, real estate, product liability, regulatory matters, employment or intellectual property claims. Although we do not expect that such claims and litigation will ultimately have a material adverse effect on our consolidated financial position, results of operations or cash flows, an adverse result in one or more matters could negatively affect our results in the period in which they occur, or in future periods. The United States and many foreign governments impose tariffs and duties on the import and export of certain products we sell and purchase. From time to time our customs compliance, product classifications, duty calculations, and payments are reviewed or audited by government agencies. Any adverse result in such a review or audit could negatively affect our results in the period in which they occur, or in future periods. German authorities are currently investigating an export compliance matter involving one of our German subsidiaries involving four former employees (whose employment was terminated following our discovery of this matter). While under German law the subsidiary can be held liable for certain infringements by its employees of German export control laws we believe that this matter involves less than approximately 1.5 million Euros in transactions in the period currently under investigation and do not believe that the final resolution of this matter will be material to our consolidated financial position, results of operations or cash flows. However, the German government investigation is ongoing and it is possible that substantial payments, fines, penalties or damages could result. Even though we do not currently expect this matter to be material to our consolidated financial position, results of operations or cash flows, circumstances could change as the investigation progresses. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended April 3, 2021, filed with the SEC on May 12, 2021, on April 28, 2021, a purported stockholder of the Company filed a complaint in the United States District Court for the Southern District of New York against Coherent and its board of directors alleging violations of the federal securities laws for misleading and incomplete disclosures in the Registration Statement on Form S-4 (the "S-4") filed in connection with the Merger (Stein v. Coherent, Inc., et al., Case No. 1:21-cv-3775). Specifically, the complaint challenges the disclosures relating to management's financial projections and the analyses of the Company's financial advisors, BofA Securities, Inc. ("BofA Securities") and Credit Suisse Securities (USA) LLC ("Credit Suisse"). Among other things, the complaint alleges that the projections should have provided a reconciliation of non-GAAP financial measures to GAAP, and that the S-4 fails to disclose details about the bankers' precedent transactions analyses and DCF analyses. The complaint seeks, among other relief, a preliminary injunction until such time as corrective disclosures are issued. The case was voluntarily dismissed on June 18, 2021. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended April 3, 2021, filed with the SEC on May 12, 2021, on May 4, 2021, a purported stockholder of the Company filed a complaint in the United States District Court for the District of New Jersey against the Company and its board of directors alleging violations of the federal securities laws for misleading and incomplete disclosures in the S-4 (Shirey v. Coherent, Inc., et al., Civil Action No. 2:21-cv-10698 (District of New Jersey, May 4, 2021)). Specifically, the complaint challenges the disclosures relating to the Company's and II-VI's financial projections, the analyses of the Company's financial advisors, BofA Securities and Credit Suisse, and potential conflicts of interest involving Credit Suisse. Among other things, the complaint alleges that the projections should have provided all line items used to calculate certain metrics and a reconciliation of non-GAAP financial measures to GAAP, that the S-4 fails to disclose details about the bankers' precedent transactions analyses, DCF analyses and price targets analyses and that there was insufficient disclosure regarding the relationships between Credit Suisse and either the Company or II-VI. The complaint seeks, among other relief, a preliminary injunction until such time as corrective disclosures are issued. The case was voluntarily dismissed on August 2, 2021. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended April 3, 2021, filed with the SEC on May 12, 2021, on May 4, 2021, a purported stockholder of the Company filed a complaint in the Southern District of New York against the Company, members of the Company's board of directors, II-VI and Watson Merger Sub Inc. alleging violations of the federal securities laws for misleading and incomplete disclosures in the S-4 (Diaz v. Coherent, Inc., et al., Case No. 1:21-cv-03990). Specifically, the complaint challenges the disclosures relating to the Company's and II-VI's financial projections, the analyses of the Company's financial advisors, BofA Securities and Credit Suisse, and potential conflicts of interest involving Credit Suisse. Among other things, the complaint alleges that the projections should have provided all line items used to calculate certain metrics and a reconciliation of non-GAAP financial measures to GAAP, that the S-4 fails to disclose details about the bankers' precedent transactions analyses, DCF analyses and price targets analyses and that there was insufficient disclosure regarding the relationships between Credit Suisse and either the Company or II-VI. The complaint seeks, among other relief, a preliminary injunction to prevent further advancement of the transaction and a direction to the director defendants to disseminate a true and non-misleading Registration Statement. The case was voluntarily dismissed on June 24, 2021. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended April 3, 2021, filed with the SEC on May 12, 2021, on May 4, 2021, a purported stockholder of the Company filed a complaint in the United States District Court for the Southern District of New York against the Company and members of its board of directors in the Southern District of New York alleging violations of the federal securities laws for misleading and incomplete disclosures in the Registration Statement on Form S-4/A (the "S-4/A") filed in connection with the Merger (Costa v. Coherent, Inc., et al., Case No. 1:21-cv-04108). Specifically, the complaint challenges the disclosures relating to Coherent's and II-VI's financial projections and the analyses of the Company's financial advisors, BofA Securities and Credit Suisse. Among other things, the complaint alleges that the projections should have provided a reconciliation of non-GAAP financial measures to GAAP, that the S-4 fails to disclose details about the bankers' precedent transactions analyses and DCF analyses and that there was insufficient disclosure regarding the discretionary payment of $3.0 million to Credit Suisse at the closing of the merger. The complaint seeks, among other relief, a preliminary injunction to prevent further advancement of the transaction and a direction to the director defendants to disseminate a true and non-misleading Registration Statement. The case was voluntarily dismissed on June 25, 2021. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended July 3, 2021, filed with the SEC on August 11, 2021, on June 1, 2021, a purported stockholder of the Company filed a complaint in the United States District Court for the Southern District of New York against the Company and members of its board of directors alleging violations of the federal securities laws for misleading and incomplete disclosures in the S-4/A (Wolf v. Coherent, Inc., et al., Case No. 1:21-cv-04848). Specifically, the complaint challenges the disclosures relating to the Company's and II-VI's financial projections, the analyses of the Company's financial advisors, BofA Securities and Credit Suisse, and potential conflicts of interest involving Credit Suisse. Among other things, the complaint alleges that the projections should have provided all line items used to calculate certain metrics and a reconciliation of non-GAAP financial measures to GAAP, that the S-4 fails to disclose details about the bankers' precedent transactions analyses, DCF analyses and price targets analyses and that there was insufficient disclosure regarding the relationships between Credit Suisse and either the Company or II-VI. The complaint seeks, among other relief, a preliminary injunction to prevent further advancement of the transaction and a direction to the director defendants to disseminate a true and non-misleading Registration Statement. The case was voluntarily dismissed on June 24, 2021. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended July 3, 2021, filed with the SEC on August 11, 2021, on June 2, 2021, a purported stockholder of the Company filed a complaint in the United States District Court for the District of Delaware against the Company and members of its board of directors alleging violations of the federal securities laws for misleading and incomplete disclosures in the S-4/A (Lawrence v. Coherent, Inc., et al., Case No. 1:21-cv-00808). Specifically, the complaint challenges the disclosures relating to Coherent's and II-VI's financial projections and the analyses of the Company's financial advisors, BofA Securities and Credit Suisse. Among other things, the complaint alleges that the projections should have provided a reconciliation of non-GAAP financial measures to GAAP, that the S-4 fails to disclose details about the bankers' precedent transactions analyses and DCF analyses, that there was insufficient disclosure regarding the discretionary payment of $3.0 million to Credit Suisse at the closing of the merger, and that there was insufficient disclosure regarding the calculation of BofA Securities' compensation. The complaint seeks, among other relief, a preliminary injunction to prevent further advancement of the transaction and a direction to the director defendants to disseminate a true and non-misleading Registration Statement. The case was voluntarily dismissed on July 8, 2021. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended July 3, 2021, filed with the SEC on August 11, 2021, on June 2, 2021, a purported stockholder of the Company filed a complaint in the United States District Court for the Northern District of California against the Company and members of its board of directors alleging violations of the federal securities laws for misleading and incomplete disclosures in the S-4/A (Lawrence v. Coherent, Inc., et al., Case No. 5:21-cv-04193). Specifically, the complaint challenges the disclosures relating to Coherent's and II-VI's financial projections and the analyses of the Company's financial advisors, BofA Securities and Credit Suisse. Among other things, the complaint alleges that the projections should have provided a reconciliation of non-GAAP financial measures to GAAP, that the S-4 fails to disclose details about the bankers' precedent transactions analyses and DCF analyses, that there was insufficient disclosure regarding the discretionary payment of $3.0 million to Credit Suisse at the closing of the merger, and that there was insufficient disclosure regarding the calculation of BofA Securities' compensation. The complaint seeks, among other relief, a preliminary injunction to prevent further advancement of the transaction and a direction to the director defendants to disseminate a true and non-misleading Registration Statement. The case was voluntarily dismissed on June 3, 2021. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended July 3, 2021, filed with the SEC on August 11, 2021, on June 3, 2021, a purported stockholder of the Company filed a complaint in the United States District Court for the Northern District of California against the Company and members of its board of directors alleging violations of the federal securities laws for misleading and incomplete disclosures in the S-4/A (Finger v. Coherent, Inc., et al., Case No. 5:21-cv-04217). Specifically, the complaint challenges the disclosures relating to Coherent's and II-VI's financial projections and the analyses of the Company's financial advisors, BofA Securities and Credit Suisse. Among other things, the complaint alleges that the projections should have provided a reconciliation of non-GAAP financial measures to GAAP, that the S-4 fails to disclose details about the bankers' precedent transactions analyses and DCF analyses, that there was insufficient disclosure regarding the discretionary payment of $3.0 million to Credit Suisse at the closing of the merger, and that there was insufficient disclosure regarding the calculation of BofA Securities' compensation. The complaint seeks, among other relief, a preliminary injunction to prevent further advancement of the transaction and a direction to the director defendants to disseminate a true and non-misleading Registration Statement. The case was voluntarily dismissed on July 8, 2021. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended July 3, 2021, filed with the SEC on August 11, 2021, on June 10, 2021, a purported stockholder of the Company filed a complaint in the United States District Court for the Eastern District of Pennsylvania against the Company and members of its board of directors alleging violations of the federal securities laws for misleading and incomplete disclosures in the S-4/A (Waterman v. Coherent, Inc., et al., Case No. 2:21-cv-02623). Specifically, the complaint challenges the disclosures relating to the analyses of the Company's financial advisors, BofA Securities and Credit Suisse. Among other things, the complaint alleges that the S-4 fails to disclose details about the bankers' precedent transactions analyses, price targets analyses, and DCF analyses. The complaint seeks, among other relief, a preliminary injunction to prevent further advancement of the transaction and a direction to the director defendants to disseminate a true and non-misleading Registration Statement. The case was voluntarily dismissed on July 8, 2021. As previously disclosed in the Company's Quarterly Report on Form 10-Q for the quarterly period ended July 3, 2021, filed with the SEC on August 11, 2021, on June 11, 2021, a purported stockholder of the Company filed a complaint in the United States District Court for the Northern District of California against the Company and members of its board of directors alleging violations of the federal securities laws for misleading and incomplete disclosures in the S-4/A (Anderson v. Coherent, Inc., et al., Case No. 5:21-cv-04505). Specifically, the complaint challenges the disclosures relating to Coherent's and II-VI's financial projections and the analyses of the Company's financial advisors, BofA Securities and Credit Suisse. Among other things, the complaint alleges that the projections should have provided a reconciliation of non-GAAP financial measures to GAAP, that the S-4 fails to disclose details about the bankers' precedent transactions analyses and DCF analyses and that there was insufficient disclosure regarding the discretionary payment of $3.0 million to Credit Suisse at the closing of the merger. The complaint seeks, among other relief, a preliminary injunction to prevent further advancement of the transaction and a direction to the director defendants to disseminate a true and non-misleading Registration Statement. The case was voluntarily dismissed on July 8, 2021. Income Tax Audits We are subject to taxation and file income tax returns in the U.S. federal jurisdiction and in many state and foreign jurisdictions. Our most significant tax jurisdictions are the U.S. and Germany. For U.S. federal and German income tax purposes, all years prior to fiscal 2018 and 2011, respectively, are closed to examination. In our other major foreign jurisdictions and our major state jurisdictions, the years prior to fiscal 2015 and 2017, respectively, are closed. Earlier years in our various jurisdictions may remain open for adjustment to the extent that we have tax attribute carryforwards from those years. In October 2021, we received a final audit report for our entities that were under audit in Germany for the years 2011 through 2016. The German tax authorities issued transfer pricing adjustments related to various intercompany transactions with our South Korean and Singapore entities. The adjustments related to transactions with our South Korean entity are being appealed and contested through the Competent Authority process with South Korea. The South Korean tax authorities had previously performed an audit focused on intercompany transfer pricing arrangements for fiscal years 2014 through 2017 related to our German and U.S. entities. In May 2019, they issued transfer pricing assessments for taxes, royalties and sales commissions and we are appealing and contesting these amounts through the Competent Authority process between South Korea, Germany and the United States. Accordingly, there is no change to our tax position at the time of filing of this annual report. We are continuing to monitor and evaluate this situation. In October 2020, the South Korean tax authorities also commenced an internal review of our initial and second High-Tech tax exemptions approved in fiscal 2013 and 2016, respectively. In March 2021 we agreed with the tax authorities change in timing for claiming the tax exemption benefits. The timing and the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. Management believes that it has adequately provided for any adjustments that may result from tax examinations. We regularly engage in discussions and negotiations with tax authorities regarding tax matters in various jurisdictions. Although the timing of resolution, settlement and closure of audits is not certain, we do not believe it is reasonably possible that our unrecognized tax benefits will materially change in the next 12 months. Other Tax Matters From time to time, we are subject to review, audit or other examination related to taxes other than income taxes. While we are not currently subject to any such matters which we expect to have a material adverse effect on our financial condition and operating results, it is possible that an adverse final conclusion to any such other tax matters could lead to a material adverse effect on our financial condition and operating results. |
Stock Repurchases
Stock Repurchases | 12 Months Ended |
Oct. 02, 2021 | |
Stockholders' Equity Note [Abstract] | |
Stock Repurchases | STOCK REPURCHASES On October 28, 2018, our board of directors authorized a stock repurchase program authorizing the Company to repurchase up to $250.0 million of our common stock through December 31, 2019, with a limit of no more than $75.0 million per quarter. During fiscal 2019, we repurchased and retired 603,828 shares of outstanding common stock under this program at an average price of $128.20 per share for a total of $77.4 million. We made no repurchases under the program during our first quarter of fiscal 2020 and the program expired on December 31, 2019. On February 5, 2020, our board of directors authorized a stock repurchase program authorizing the Company to repurchase up to $100.0 million of our common stock through January 31, 2021.We made no repurchases under the program during fiscal 2020 or 2021. |
Other Income (Expense), Net
Other Income (Expense), Net | 12 Months Ended |
Oct. 02, 2021 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense), Net | OTHER INCOME (EXPENSE), NET Other income (expense) includes other-net which is comprised of the following (in thousands): Fiscal 2021 2020 2019 Foreign exchange loss $ (4,972) $ (3,486) $ (5,774) Gain on deferred compensation investments, net (Note 12) 9,774 6,099 1,140 Translation adjustment related to the dissolution of certain entities (1) (5,291) — — Other 765 828 (410) Other—net $ 276 $ 3,441 $ (5,044) (1) In the fourth quarter of fiscal 2021, the Company had substantially completed the liquidation of several operations, primarily OR Laser, and recognized in other income (expense) the net accumulated translation losses for these subsidiaries previously recorded in accumulated other comprehensive income (loss) on the consolidated balance sheet. |
Income Taxes
Income Taxes | 12 Months Ended |
Oct. 02, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The provision for (benefit from) income taxes on income (loss) before income taxes consists of the following (in thousands): Fiscal 2021 2020 2019 Currently payable: Federal $ 4,929 $ (1,660) $ 1,995 State 390 471 557 Foreign 33,713 1,176 13,448 39,032 (13) 16,000 Deferred and other: Federal (47,908) (2,343) (407) State (4,872) (1,605) 516 Foreign 4,961 (24,623) (9,886) (47,819) (28,571) (9,777) Provision for (benefit from) income taxes $ (8,787) $ (28,584) $ 6,223 The components of income before income taxes consist of (in thousands): Fiscal 2021 2020 2019 United States $ (207,827) $ (98,900) $ 54,480 Foreign 92,289 (343,823) 5,568 Income (loss) before income taxes $ (115,538) $ (442,723) $ 60,048 The reconciliation of the income tax expense (benefit) at the U.S. Federal statutory rate (21.0%) to actual income tax expense (benefit) is as follows (in thousands): Fiscal 2021 2020 2019 Federal statutory tax expense (benefit) $ (24,263) $ (92,972) $ 12,610 Valuation allowance 14,925 15,231 7,925 Taxes on foreign earnings at rates greater (less) than U.S. rates, net 8,326 (27,041) (8,210) Stock-based compensation 4,351 3,640 556 State income taxes, net of federal income tax benefit (4,215) (1,249) 1,131 Research and development credit (4,279) (4,350) (3,665) Deferred compensation (1,050) (564) (206) Release of unrecognized tax benefits (1,957) (20,027) (6,688) Release of interest accrued for unrecognized tax benefits (328) (4,232) (205) Reversal of competent authority — 8,552 — Deferred taxes on foreign earnings 2,302 1,303 1,215 Write-off of withholding tax credits — — 1,134 Goodwill impairment — 89,962 — FDII deduction (2,791) — 536 Other, net 192 3,163 90 Provision for (benefit from) income taxes $ (8,787) $ (28,584) $ 6,223 Effective tax rate 7.6 % 6.5 % 10.4 % Our effective tax rate on loss before income taxes for fiscal 2021 of 7.6% was lower than the U.S. federal tax rate of 21.0%. Our effective tax rate benefit for fiscal 2021 was unfavorably impacted primarily due to the establishment of valuation allowances on certain deferred tax assets, income in foreign jurisdictions subject to tax rates that are higher than the U.S. tax rates, stock-based compensation not deductible for tax purposes and limitations on the deductibility of compensation under Internal Revenue Code Section 162(m) and the deferred taxes on foreign earnings not considered permanently reinvested, partially offset by the benefit of federal research and development tax credits, our Singapore tax exemption and the benefit of our FDII deduction. Our results reflect the payment of a termination fee of $217.6 million to Lumentum in fiscal 2021. This amount was deducted for book purposes in the current year and treated as a future deductible expense for tax purposes in accordance with our accounting policy. The effective tax rate on loss before income taxes for fiscal 2020 of 6.5% was lower than the U.S. federal tax rate of 21.0%. Our effective tax benefit for fiscal 2020 was unfavorably impacted primarily due to the impairment of goodwill that is not deductible for tax purposes and the establishment of valuation allowances for certain deferred tax assets. These unfavorable impacts were partially offset primarily from the release of unrecognized tax benefits net of settlements and competent authority offsets and losses in foreign jurisdictions subject to tax rates that are higher than the U.S. tax rates. In September 2021, Coherent Singapore received an amended Pioneer Status tax exemption from the Singapore authorities effective from fiscal 2022 through fiscal 2026. The tax holiday continues to be conditional upon our meeting certain revenue, business spending and employment thresholds. The impact of this tax exemption decreased Coherent Singapore income taxes by approximately $3.7 million, $2.6 million, and $3.9 million in fiscal 2021, fiscal 2020, and fiscal 2019, respectively. The benefits of the tax holiday on net income (loss) per diluted share were $0.15, $0.11, and $0.16, respectively. The significant components of deferred tax assets and liabilities were (in thousands): Fiscal year-end 2021 2020 Deferred tax assets: Reserves and accruals not currently deductible $ 49,027 $ 28,520 Operating loss carryforwards and tax credits 73,902 83,447 Deferred revenue 5,785 4,412 Depreciation and amortization 12,311 14,362 Inventory capitalization 3,509 — Stock-based compensation 3,452 4,906 Competent authority offset to transfer pricing tax reserves 3,972 4,283 Accumulated translation adjustment 3,970 2,508 Retirement and pension 16,303 17,982 Lease liabilities 20,080 21,737 Acquisition costs 52,629 — Other — 165 Total gross deferred tax assets 244,940 182,322 Valuation allowance (73,166) (57,707) Total net deferred tax assets 171,774 124,615 Deferred tax liabilities: Deferred tax liabilities on foreign earnings 18,381 16,055 Inventory capitalization — 1,394 Right of use assets 19,040 20,859 Other 24 — Total gross deferred tax liabilities 37,445 38,308 Net deferred tax assets $ 134,329 $ 86,307 In determining our fiscal 2021 and 2020 tax provisions under ASC 740, we calculated the deferred tax assets and liabilities for each separate tax entity. We then considered a number of factors including the positive and negative evidence regarding the realization of our deferred tax assets to determine whether a valuation allowance should be recognized with respect to our deferred tax assets. We determined that a valuation allowance was appropriate for a portion of the deferred tax assets of our California and certain state research and development tax credits and certain foreign deferred taxes, including foreign tax attributes and foreign net operating losses. During fiscal 2021, we increased our valuation allowance on deferred tax assets by $15.5 million to $73.2 million, primarily due to certain foreign deferred tax assets and California (and other) state research and development tax credits which are not expected to be recognized. At October 2, 2021, we had U.S. federal deferred tax assets related to research and development credits, foreign tax credits and other tax attributes that can be used to offset federal taxable income in future periods. These credit carryforwards will expire if they are not used within certain time periods. Management determined that there is sufficient positive evidence to conclude that it is more likely than not that sufficient taxable income will exist in the future allowing us to recognize these deferred tax assets. The net deferred tax asset is classified on the consolidated balance sheets as follows (in thousands): Fiscal year-end 2021 2020 Non-current deferred income tax assets $ 153,685 $ 102,028 Non-current deferred income tax liabilities (19,356) (15,721) Net deferred tax assets $ 134,329 $ 86,307 We have various tax attribute carryforwards which include the following: • Foreign gross net operating loss carryforwards are $132.9 million, of which $98.8 million have no expiration date and $34.1 million have various expiration dates beginning in fiscal 2023. Among the total of $132.9 million foreign net operating loss carryforwards, a valuation allowance of $128.0 million has been provided for certain jurisdictions since the recovery of the carryforwards is uncertain. U.S. federal and certain state gross net operating loss carryforwards are $10.1 million and $30.4 million, respectively, which were acquired from our acquisitions. A full valuation allowance against certain state net operating losses of $30.4 million has been recorded. • U.S. federal R&D credit carryforwards of $38.4 million are scheduled to expire beginning in fiscal 2026. California R&D credit carryforwards of $34.9 million have no expiration date. A total of $29.4 million valuation allowance, before U.S. federal benefit, has been recorded against California R&D credit carryforwards of $34.9 million since the recovery of the carryforwards is uncertain. Other states R&D credit carryforwards of $4.3 million are scheduled to expire beginning in fiscal 2022. A valuation allowance totaling $3.8 million, before U.S. federal benefit, has been recorded against certain state R&D credit carryforwards of $4.3 million since the recovery of the carryforwards is uncertain. • U.S. federal foreign tax credit carryforwards of $38.4 million are scheduled to expire beginning in fiscal 2028. We are subject to taxation and file income tax returns in the U.S. federal jurisdiction and in many state and foreign jurisdictions. Our most significant tax jurisdictions are the U.S. and Germany. For U.S. federal and German income tax purposes, all years prior to fiscal 2018 and 2011, respectively, are closed to examination. In our other major foreign jurisdictions and our major state jurisdictions, the years prior to fiscal 2015 and 2017, respectively, are closed. Earlier years in our various jurisdictions may remain open for adjustment to the extent that we have tax attribute carryforwards from those years. In October 2021, we received a final audit report for our entities that were under audit in Germany for the years 2011 through 2016. The German tax authorities issued transfer pricing adjustments related to various intercompany transactions with our South Korean and Singapore entities. The adjustments related to transactions with our South Korean entity are being appealed and contested through the Competent Authority process with South Korea. The South Korean tax authorities had previously performed an audit focused on intercompany transfer pricing arrangements for fiscal years 2014 through 2017 related to our German and U.S. entities. In May 2019, they issued transfer pricing assessments for taxes, royalties and sales commissions and we are appealing and contesting these amounts through the Competent Authority process between South Korea, Germany and the United States. Accordingly, there is no change to our tax position at the time of filing of this annual report. We are continuing to monitor and evaluate this situation. In October 2020, the South Korean tax authorities also commenced an internal review of our initial and second High-Tech tax exemptions approved in fiscal 2013 and 2016, respectively. In March 2021 we agreed with the tax authorities change in timing for claiming the tax exemption benefits. The timing and the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. Management believes that it has adequately provided for any adjustments that may result from tax examinations. We regularly engage in discussions and negotiations with tax authorities regarding tax matters in various jurisdictions. Although the timing of resolution, settlement, and closure of audits is not certain, we do not believe it is reasonably possible that our unrecognized tax benefits will materially change in the next 12 months. A reconciliation of the change in gross unrecognized tax benefits, excluding interest and penalties, is as follows (in thousands): Fiscal 2021 2020 2019 Balance as of the beginning of the year $ 39,507 $ 58,111 $ 65,882 Tax positions related to current year: Additions 1,017 1,410 605 Tax positions related to prior year: Additions 1,440 86 448 Reductions (6) (17) (6,071) Lapses in statutes of limitations (2,017) (1,211) (639) Decrease in unrecognized tax benefits based on settlement — (19,463) — Foreign currency revaluation adjustment (54) 591 (2,114) Balance as of end of year $ 39,887 $ 39,507 $ 58,111 As of October 2, 2021, the total amount of gross unrecognized tax benefits including gross interest and penalties was $43.4 million, of which $32.4 million, if recognized, would affect our effective tax rate. Our total gross unrecognized tax benefit, net of certain deferred tax assets is classified as a long-term taxes payable in the consolidated balance sheets. We include interest and penalties related to unrecognized tax benefits within the provision for income taxes. As of October 2, 2021, the total amount of gross interest and penalties accrued was $3.6 million and it is classified as Other long-term liabilities in the consolidated balance sheets. As of October 3, 2020, we had accrued $2.9 million for the gross interest and penalties and it is classified as Other long-term liabilities in the consolidated balance sheets. A summary of the fiscal tax years that remain subject to examination, as of October 2, 2021, for our major tax jurisdictions is: United States—Federal 2018—forward United States—Various States 2017—forward Netherlands 2016—forward Germany 2011—forward Japan 2015—forward South Korea 2016—forward United Kingdom 2020—forward |
Defined Benefit Plans (Notes)
Defined Benefit Plans (Notes) | 12 Months Ended |
Oct. 02, 2021 | |
Retirement Benefits [Abstract] | |
Defined Benefit Plans | DEFINED BENEFIT PLANS As a result of the Rofin acquisition in fiscal 2017, we assumed all assets and liabilities of Rofin's defined benefit plans for the Rofin-Sinar Laser, GmbH ("RSL") and Rofin-Sinar Inc. ("RS Inc.") employees. The U.S. plan began in fiscal 1995 and is partially funded. Any new employees hired after January 1, 2007, are not eligible for the RS Inc. pension plan. As is the customary practice with German companies, the German pension plan is unfunded. Any new employees hired after 2000 are not eligible for the RSL pension plan. The measurement date of these pension plans is September 30 and actuarial gains and losses are deferred into OCI and amortized over future periods. Effective January 1, 2012, the RS Inc. defined benefit plan was amended to exclude highly compensated employees, as defined by the Internal Revenue Service, from receiving future years of service under the RS Inc. defined benefit plan. A non-qualified defined benefit plan was created to replace the benefits lost by the employees that were otherwise excluded from the qualified defined benefit plan. Effective August 31, 2018, both the RS Inc. plans were amended to freeze all future compensation benefit accruals. During fiscal 2020, we opened a lump sum payment election window for the RS Inc. defined benefit plan to allow certain participants the option to receive the entire value of their benefit as a single lump sum payment, resulting in payments of $1.0 million in fiscal 2020. In addition, we have defined benefit plans in South Korea, Japan, Spain, and Italy, covering all full-time employees with at least one year of service, and a defined benefit plan in Germany covering two individuals. As is the customary practice with European and Asian companies, the plans are unfunded, with the exception of the Spanish plan which is partially funded. We have elected to recognize all actuarial gains and losses on these plans immediately, as incurred. The measurement date of these defined benefit plans is September 30. For financial reporting purposes, the calculation of net periodic pension costs is based upon a number of actuarial assumptions including a discount rate for plan obligations, an assumed rate of return on pension assets and an assumed rate of compensation increase for employees covered by the plan. All of these assumptions were based upon management's judgment, considering all known trends and uncertainties. Actual results that differ from these assumptions would impact future expense recognition and the cash funding requirements of our defined benefit plans. Components of net periodic cost are as follows for fiscal 2021, 2020, and 2019 (in thousands): Fiscal 2021 2020 2019 Service cost $ 2,003 $ 2,153 $ 1,955 Interest cost 936 857 1,308 Expected return on plan assets (620) (682) (817) Recognized net actuarial (gain) loss (292) (690) 470 Foreign exchange impacts (82) 66 (79) Net periodic pension cost $ 1,945 $ 1,704 $ 2,837 The service cost component of net periodic costs is included in selling, general and administrative ("SG&A") expenses, and the interest costs, net actuarial (gain) loss and other components are included in Other-net within other income (expense) in the consolidated statements of operations. The changes in projected benefit obligations and plan assets, as well as the ending balance sheet amounts for our defined benefit plans, are as follows (in thousands): Fiscal year-end 2021 2020 Change in benefit obligation: Projected benefit obligation at beginning of year $ 60,607 $ 60,437 Service cost 2,003 2,153 Interest cost 936 857 Assumption change (443) (1,783) Experience loss 261 22 Foreign exchange rate impacts (704) 2,433 Benefits paid – total (2,327) (3,010) Settlement gain — (502) Projected benefit obligation at end of year $ 60,333 $ 60,607 Projected benefit obligation at end of year: U.S. plans $ 18,070 $ 18,775 Foreign plans 42,263 41,832 Projected benefit obligation at end of year $ 60,333 $ 60,607 Change in plan assets: Fair value of plan assets at beginning of year $ 12,901 $ 12,997 Actual return on plan assets 1,032 1,218 Employer contributions 87 208 Benefits paid – funded plan (607) (1,522) Fair value of plan assets at end of year $ 13,413 $ 12,901 Fair value of plan assets at end of year: U.S. plans $ 13,131 $ 12,645 Foreign plans 282 256 Fair value of plan assets at end of year 13,413 12,901 Unfunded status at end of year $ (46,920) $ (47,706) Amounts recognized in the consolidated balance sheet: Accrued benefit liability – current $ (2,810) $ (1,896) Accrued benefit liability – non current (44,110) (45,810) Accumulated other comprehensive loss (pre-tax) 190 456 The information for plans with an accumulated benefit obligation in excess of plan assets is as follows (in thousands): Fiscal year-end 2021 2020 Projected benefit obligation $ 60,333 $ 60,607 Accumulated benefit obligation 56,656 56,847 Fair value of plan assets 13,413 12,901 The weighted-average rates used to determine the net periodic benefit costs are as follows: Fiscal 2021 2020 Discount rate: U.S. 2.6 % 2.3 % Foreign 1.2 % 1.2 % Expected return on plan assets: U.S. 5.0 % 5.0 % Rate of compensation increase U.S. — % — % Foreign 2.2 % 2.2 % We recognize the over (under) funded status of the defined benefit plans in our consolidated balance sheets. We also recognize, in other comprehensive income (loss), certain gains and losses that arise for the period but are deferred under current pension accounting rules. A one percent change in the discount rate or the expected rate of return on plan assets would not have a material impact on the projected benefit obligation or the net periodic benefit cost. The decrease in discount rates for U.S. and foreign plans was the primary reason for the assumption change and the increase in the projected benefit obligation. Expected benefit payments for each of the next five fiscal years and the five years aggregated thereafter is as follows (in thousands): Amount 2022 $ 3,539 2023 2,370 2024 2,867 2025 2,925 2026 3,291 2027-2031 16,142 Total $ 31,134 Our pension plan asset allocations at October 2, 2021 and October 3, 2020 by asset category are as follows: Allocation Target Fiscal 2021 Fiscal 2020 Equity securities 60 % 59 % 32 % Debt securities 40 % 41 % 68 % Total plan assets 100 % 100 % 100 % We employ a total return investment approach whereby a mix of equity, debt securities and government securities are used to maximize the long-term return of plan assets for a prudent level of risk. The intent of this strategy is to minimize plan expenses by maximizing investment returns within that prudent level of risk. Furthermore, equity investments are diversified across U.S. and non-U.S. stocks as well as growth, value and small and large capitalizations. Additionally, cash balances are maintained at levels adequate to meet near-term plan expenses and benefit payments. Investment risk is measured and monitored on an ongoing basis through semi-annual investment portfolio reviews. Investments in our defined benefit plan are stated at fair value. Level 1 assets are valued using quoted market prices that represent the asset value of the shares held by the trusts. The level 2 assets are investments in pooled funds, which are valued using a model to reflect the valuation of their underlying assets that are publicly traded with observable values. The fair value of level 3 pension plan assets are measured by compiling the portfolio holdings and independently valuing the securities in those portfolios. The fair values of our pension plan assets, by level within the fair value hierarchy, at October 2, 2021 are as follows: Asset categories Level 1 Level 2 Level 3 Total Cash and cash equivalents: Money market $ 2,731 $ — $ — $ 2,731 Equity securities: Small cap — — — — Mid cap — — — — Large cap — — — — Total market stock — 3,390 — 3,390 International — 1,751 — 1,751 Emerging markets — — — — Debt securities: Bonds and mortgages — 5,481 — 5,481 Inflation protected — — — — High yield — — — — Liability driven investments — 60 — 60 Total plan assets $ 2,731 $ 10,682 $ — $ 13,413 The fair values of our pension plan assets, by level within the fair value hierarchy, at October 3, 2020 are as follows: Asset categories Level 1 Level 2 Level 3 Total Cash and cash equivalents: Money market $ 469 $ — $ — $ 469 Equity securities: Small cap — 50 — 50 Mid cap — 143 — 143 Large cap — 293 — 293 Total market stock — 2,140 — 2,140 International — 1,166 — 1,166 Emerging markets — 197 — 197 Debt securities: Bonds and mortgages — 3,323 — 3,323 Inflation protected — — — — High yield — 272 — 272 Liability driven investments — $ 4,848 4,848 Total plan assets $ 469 $ 12,432 $ — $ 12,901 |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Oct. 02, 2021 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | SEGMENT AND GEOGRAPHIC INFORMATION We are organized into two reporting segments, OLS and ILS, based upon our organizational structure and how the CODM receives and utilizes information provided to allocate resources and make decisions. This segmentation reflects the go-to-market strategies and synergies for our broad portfolio of laser technologies and products. While both segments deliver cost-effective, highly reliable photonics solutions, the OLS business segment is focused on high performance laser sources and complex optical sub-systems, typically used in microelectronics manufacturing, medical diagnostics, and therapeutic applications, as well as in scientific research. Our ILS business segment delivers high performance laser sources, sub-systems, and machine tools primarily used for industrial laser materials processing, serving important end markets like automotive, machine tools, consumer goods, and medical device manufacturing as well as applications in aerospace and defense. We have identified OLS and ILS as operating segments for which discrete financial information is available. Both units have dedicated engineering, manufacturing, product business management, and product line management functions. A small portion of our outside revenue is attributable to projects and recently developed products for which a segment has not yet been determined. The associated direct and indirect costs are presented in the category of Corporate and other, along with other corporate costs as described below. Our Chief Executive Officer has been identified as the CODM, as he assesses the performance of the segments and decides how to allocate resources to the segments. Income (loss) from operations is the measure of profit and loss that our CODM uses to assess performance and make decisions. Assets by segment are not a measure used to assess the performance of the company by the CODM and thus are not reported in our disclosures. Income (loss) from operations represents the net sales less the cost of sales and direct operating expenses incurred within the operating segments as well as allocated expenses such as shared sales and manufacturing costs. We do not allocate certain operating expenses to our operating segments and we manage them at the corporate level. These unallocated costs include stock-based compensation and corporate functions (certain management, finance, legal, and human resources) and are included in the results below under Corporate and other in the reconciliation of operating results. Management does not consider unallocated Corporate and other costs in its measurement of segment performance. The following table provides net sales and income (loss) from operations for our operating segments and a reconciliation of our total income (loss) from operations to income (loss) before income taxes (in thousands): Fiscal 2021 2020 2019 Net sales: OEM Laser Sources $ 913,636 $ 758,929 $ 886,676 Industrial Lasers & Systems 573,832 470,070 543,964 Total net sales $ 1,487,468 $ 1,228,999 $ 1,430,640 Income (loss) from operations: OEM Laser Sources $ 214,003 $ 169,883 $ 239,073 Industrial Lasers & Systems (1) 13,257 (518,186) (93,133) Corporate and other (2) (325,473) (81,877) (62,845) Total income (loss) from operations (98,213) (430,180) 83,095 Total other expense, net (17,325) (12,543) (23,047) Income (loss) before income taxes $ (115,538) $ (442,723) $ 60,048 (1) The fiscal 2020 loss includes non-cash pre-tax goodwill impairment charges of $327.2 million as well as non-cash pre-tax charges related to the impairment of intangible assets, property, plant and equipment and ROU assets of $33.9 million, $85.6 million, and $1.8 million, respectively. See Note 8, "Goodwill and Intangible Assets" in the Notes to Consolidated Financial Statements and Note 11, "Leases" in the Notes to Consolidated Financial Statements under Item 8 of this annual report. (2) The fiscal 2021 loss includes $236.0 million for merger and acquisition costs (primarily due to a $217.6 million termination fee paid to Lumentum). Geographic Information Our foreign operations consist primarily of manufacturing facilities and sales offices in Europe and Asia-Pacific. Sales, marketing, and customer service activities are conducted through sales subsidiaries throughout the world. Geographic sales information for fiscal 2021, 2020, and 2019 is based on the location of the end customer. Geographic long-lived asset information presented below is based on the physical location of the assets at the end of each year. Sales to unaffiliated customers are as follows (in thousands): Fiscal SALES 2021 2020 2019 United States $ 336,310 $ 296,102 $ 339,585 Foreign countries: South Korea 274,298 247,461 313,461 China 274,026 196,824 194,653 Japan 119,202 94,068 138,028 Asia-Pacific, other 136,942 94,835 93,389 Germany 139,240 117,170 145,285 Europe, other 138,144 125,739 148,680 Rest of World 69,306 56,800 57,559 Total foreign countries sales 1,151,158 932,897 1,091,055 Total sales $ 1,487,468 $ 1,228,999 $ 1,430,640 Long-lived assets, which include all non-current assets other than goodwill, intangibles, non-current restricted cash, our investment in 3D-Micromac AG and deferred taxes, by geographic region, are as follows (in thousands): Fiscal year-end LONG-LIVED ASSETS 2021 2020 United States $ 185,953 $ 170,412 Foreign countries: Germany 157,199 123,019 Europe, other 35,142 35,810 Asia-Pacific 52,346 56,125 Total foreign countries long-lived assets 244,687 214,954 Total long-lived assets $ 430,640 $ 385,366 Major Customers We had one major customer who accounted for 15.9%, 17.2%, and 16.8% of consolidated revenue during fiscal 2021, 2020, and 2019, respectively. The customer purchased primarily from our OLS segment. |
Restructuring Charges (Notes)
Restructuring Charges (Notes) | 12 Months Ended |
Oct. 02, 2021 | |
Restructuring Charges [Abstract] | |
Restructuring Charges | RESTRUCTURING CHARGESIn June 2019, we announced our plans to exit a portion of our HPFL business and consolidate all HPFL manufacturing and engineering functions in our Tampere, Finland facility by transferring certain HPFL activities from our Hamburg, Germany facility. We recorded charges in fiscal 2020 of $1.1 million, primarily related to accelerated depreciation and project management consulting. We recorded no charges related to this project in fiscal 2021 as the project was completed in fiscal 2020. We also vacated our leased facility in Santa Clara at the end of the lease term on July 31, 2020 and combined operations into our owned Santa Clara headquarters. We incurred costs in fiscal 2021 and 2020 of $0.1 million and $1.5 million, respectively, primarily related to accelerated depreciation, and completed the project in fiscal 2021. We also incurred costs in fiscal 2020 of $0.1 million for other projects. In the fourth quarter of fiscal 2020, we began a restructuring program in our ILS segment which includes management reorganizations, the planned closure of multiple manufacturing sites, and the right-sizing of global sales, service, order admin, marketing communication and certain administrative functions, among others. In the fourth quarter of fiscal 2020, we incurred costs of $2.6 million, primarily related to severance. In fiscal 2021, we incurred costs of $12.2 million, primarily related to write-offs of excess inventory, accruals for vendor commitments and warranty provisions, which are recorded in cost of sales, estimated severance, facility exit costs and accelerated depreciation. The following table presents our current liability as accrued on our balance sheets for restructuring charges. The table sets forth an analysis of the components of the restructuring charges and payments and other deductions made against the accrual for fiscal 2021 and fiscal 2020 (in thousands): Severance Related Asset Write-Offs Other Total Balances, September 28, 2019 $ 8,279 $ — $ 215 $ 8,494 Provision 2,468 2,194 629 5,291 Payments and other (8,136) (2,194) (614) (10,944) Balances, October 3, 2020 2,611 — 230 2,841 Provision 3,795 5,637 2,850 12,282 Payments and other (5,279) (5,637) (2,799) (13,715) Balances, October 2, 2021 $ 1,127 $ — $ 281 $ 1,408 At October 2, 2021, $1.4 million of accrued severance related and other costs were included in other current liabilities. The severance, asset write-offs for inventory, accruals for vendor commitments, warranty provisions, facility exit costs, accelerated depreciation and other costs in fiscal 2021 primarily related to the restructuring program that began in the fourth quarter of fiscal 2020. The asset write-offs for accelerated depreciation and other costs in fiscal 2020 primarily related to the exit of a portion of our HPFL business in Hamburg, Germany, and costs to vacate our leased facility in Santa Clara and combine operations into our owned Santa Clara headquarters. The severance related costs in fiscal 2020 primarily related to the restructuring program that began in the fourth quarter of fiscal 2020. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Oct. 02, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fiscal Year | Fiscal Year Our fiscal year ends on the Saturday closest to September 30. Fiscal years 2021, 2020, and 2019 ended on October 2, 2021, October 3, 2020, and September 28, 2019, respectively, and are referred to in these financial statements as fiscal 2021, fiscal 2020, and fiscal 2019 for convenience. Fiscal 2021 and 2019 each included 52 weeks and fiscal 2020 included 53 weeks. The fiscal years of several of our international subsidiaries end on September 30. Accordingly, the financial statements of these subsidiaries as of that date and for the years then ended have been used for our consolidated financial statements. Management believes that the impact of the use of different year-ends is immaterial to our consolidated financial statements taken as a whole. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Basis of Presentation | Basis of PresentationThe consolidated financial statements include the accounts of Coherent, Inc. and its direct and indirect subsidiaries (collectively, the "Company," "we," "our," "us" or "Coherent"). Intercompany balances and transactions have been eliminated. |
Business Combinations | Business Combinations We include the results of operations of the businesses that we acquire as of the respective dates of acquisition. We allocate the fair value of the purchase price of our business acquisitions to the tangible assets acquired, liabilities assumed, and intangible assets acquired, based on their estimated fair values. The excess of the purchase price over the fair values of these identifiable assets and liabilities is recorded as goodwill. On April 19, 2021, we acquired Electro-Optics Technology, Inc. ("EOT") and its subsidiary in Germany. The significant accounting policies of EOT have been aligned to conform to those of Coherent, and the consolidated financial statements include the results of EOT as of its acquisition date. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of certain of our financial instruments including accounts receivable, accounts payable, and accrued liabilities approximate fair value due to their short maturities. Short-term investments are comprised of available-for-sale securities, which are carried at fair value. Other non-current assets include trading securities and life insurance contracts related to our deferred compensation plans; trading securities are carried at fair value and life insurance contracts are carried at cash surrender values, which due to their ability to be converted to cash at that amount, approximate their fair values. Foreign exchange contracts are stated at fair value based on prevailing financial market information. Short-term and long-term debt is carried at amortized cost, which approximates its fair value based on borrowing rates currently available to us for loans with similar terms. |
Cash Equivalents | Cash Equivalents All highly liquid investments with maturities of three months or less at the time of purchase are classified as cash equivalents. At fiscal 2021 year-end, cash and cash equivalents included cash, money market funds, and time deposits. |
Concentration of Credit Risk | Concentration of Credit RiskFinancial instruments that may potentially subject us to concentrations of credit risk consist principally of cash equivalents, short-term investments, and accounts receivable. At fiscal 2021 year-end, all of our short-term investments were in cash and cash equivalents. Cash equivalents and short-term investments are maintained with several financial institutions and may exceed the amount of insurance provided on such balances. At October 2, 2021, we held cash and cash equivalents and short-term investments outside the U.S. in certain of our foreign operations totaling approximately $310.6 million, $291.7 million of which was denominated in currencies other than the U.S. Dollar. The majority of our accounts receivable are derived from sales to customers for commercial applications. We perform ongoing credit evaluations of our customers' financial condition and limit the amount of credit extended when deemed necessary but generally require no collateral. In certain instances, we may require customers to issue a letter of credit. We maintain reserves for potential credit losses. |
Derivative Financial Instruments | Derivative Financial Instruments Our primary objective for holding derivative financial instruments is to manage currency exchange rate risk. Principal currencies hedged include the Euro, South Korean Won, Japanese Yen, Chinese Renminbi, Singapore Dollar, British Pound, Malaysian Ringgit, Swiss Franc, Canadian Dollar, Swedish Krona, Taiwan Dollar, and Vietnamese Dong. Our derivative financial instruments are recorded at fair value, on a gross basis, and are included in other current assets and other current liabilities. Our accounting policies for derivative financial instruments are based on whether they meet the criteria for designation as a cash flow hedge. If we have any that meet this criteria, changes in the fair value of these cash flow hedges that are highly effective are recorded in accumulated other comprehensive income and reclassified into earnings in the same line item on the consolidated statements of operations as the impact of the hedged transaction during the period in which the hedged transaction affects earnings. The ineffective portion of cash flow hedges are recognized immediately in other income and expenses. Derivatives that we designate as cash flow hedges are classified in the consolidated statements of cash flows in the same section as the underlying item, primarily within cash flows from operating activities. The changes in fair value of derivative instruments that are not designated as hedges are recognized immediately in other income (expense). |
Accounts Receivable Allowance | Accounts Receivable Allowances Accounts receivable allowances reflect our best estimate of probable losses inherent in our accounts receivable balances, including both losses for uncollectible accounts receivable and sales returns. We regularly review allowances by considering factors such as historical experience, credit quality, the age of the accounts receivable balances, and current economic conditions that may affect a customer's ability to pay. |
Inventories | InventoriesInventories are stated at the lower of cost (first-in, first-out or weighted average cost) or net realizable value. |
Property and Equipment | Property and EquipmentProperty and equipment are stated at cost and are depreciated or amortized using the straight-line method. |
Asset Retirement Obligations | Asset Retirement ObligationsThe fair value (the present value of estimated cash flows) of a liability for an asset retirement obligation is recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The fair value of the liability is added to the carrying amount of the associated asset and this additional carrying amount is depreciated over the life of the asset. All of our existing asset retirement obligations are associated with commitments to return the property to its original condition upon lease termination at various sites and costs to clean up and dispose of certain fixed assets at our Sunnyvale, California site. |
Long-lived Assets | Long-lived AssetsWe evaluate the carrying value of long-lived assets, including intangible assets, whenever events or changes in business circumstances or our planned use of long-lived assets indicate that their carrying amounts may not be fully recoverable or that their useful lives are no longer appropriate. Reviews are performed to determine whether the carrying values of long-lived assets are impaired based on a comparison to the undiscounted expected future net cash flows. If the comparison indicates that impairment exists, long-lived assets that are classified as held and used are written down to their respective fair values. When long-lived assets are classified as held for sale, they are written down to their respective fair values less costs to sell. Significant management judgment is required in the forecast of future operating results that is used in the preparation of expected undiscounted cash flows. |
Goodwill | Goodwill Goodwill is tested for impairment on an annual basis and between annual tests in certain circumstances, and written down when impaired (See Note 8, "Goodwill and Intangible Assets"). In testing for impairment, we have the option to first assess qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount. Moreover, an entity can bypass the qualitative assessment for any reporting unit in any period and proceed directly to the impairment test, and then resume performing the qualitative assessment in any subsequent period. In our fiscal 2021 annual testing, for our OLS reporting unit we conducted a qualitative assessment of the goodwill during the fourth quarter using the opening balance sheet as of the first day of the fourth quarter and concluded that it was more likely than not that the fair value of the reporting unit exceeded its carrying amounts. Based on our assessment, goodwill in the OLS reporting unit was not impaired as of the first day of the fourth quarter of fiscal 2021. As such, it was not necessary to perform the goodwill impairment test in the fourth quarter of fiscal 2021. There is no goodwill in the ILS reporting unit due to the impairment of all goodwill of the ILS reporting unit in the second quarter of fiscal 2020. |
Intangible Assets | Intangible Assets Intangible assets, including acquired existing technology, customer relationships and production know-how are amortized on a straight-line basis over their estimated useful lives, currently 4 years to 15 years (See Note 8, "Goodwill and Intangible Assets"). |
Warranty Reserves | Warranty Reserves We provide warranties on the majority of our product sales and reserves for estimated warranty costs are recorded during the period of sale. The determination of such reserves requires us to make estimates of product return rates and expected costs to repair or replace the products under warranty. We currently establish warranty reserves based on historical warranty costs for each product line. The weighted average warranty period covered is approximately 15 months to 18 months. If actual return rates and/or repair and replacement costs differ significantly from our estimates, adjustments to cost of sales may be required in future periods. |
Loss contingencies | Loss Contingencies We are subject to the possibility of various loss contingencies arising in the ordinary course of business. We consider the likelihood of loss or impairment of an asset, or the incurrence of a liability, as well as our ability to reasonably estimate the amount of loss, in determining loss contingencies. An estimated loss contingency is accrued when it is probable that an asset has been impaired or a liability has been incurred and the amount of loss can be reasonably estimated. If we determine that a loss is possible and the range of the loss can be reasonably determined, then we disclose the range of the possible loss. We regularly evaluate current information available to us to determine whether an accrual is required, an accrual should be adjusted or a range of possible loss should be disclosed. |
Revenue Recognition | Revenue Recognition Effective September 30, 2018, we adopted ASU 2014-09, Revenue from Contracts with Customers ("ASC 606"), using the modified retrospective transition method applied to contracts that were not completed as of September 29, 2018. Under ASC 606, we determine revenue recognition by applying the following five-step approach: Step 1 Identification of the contract, or contracts, with a customer; Step 2 Identification of the performance obligations in the contract; Step 3 Determination of the transaction price; Step 4 Allocation of the transaction price to the performance obligations in the contract; and Step 5 Recognition of revenue when, or as, we satisfy each performance obligation. Contracts and customer purchase orders, which in some cases are governed by master sales agreements, are generally used to determine the existence of an arrangement. In addition, shipping documents and customer acceptance, if applicable, are used to verify delivery and transfer of control. Performance obligations are identified based on the products or services that will be transferred to the customer that are considered distinct. Being distinct is defined as products or services that the customer can benefit from either on its own or together with other resources that are readily available from third parties or from us, and by the product or service being separately identifiable from other promises in the contract. We assess our ability to collect from our customers based primarily on the creditworthiness and past payment history of each customer. Revenue from all sales are recognized at the transaction price. The transaction price is determined based on the consideration to which we will be entitled in exchange for transferring goods or services to the customer adjusted for estimated variable consideration, if any. The consideration associated with customer contracts is generally fixed. Variable consideration includes discounts, rebates, credits and incentives, or other similar items. The amount of consideration that can vary is not a substantial portion of the total consideration. Variable consideration estimates are re-assessed at each reporting period until a final outcome is determined. Changes to the original transaction price due to a change in estimated variable consideration are calculated on a retrospective basis, with the adjustment recorded in the period in which the change occurs. Sales to customers are generally not subject to any price protection or return rights. Accordingly, upon application of steps one through five above, product revenue is recognized upon shipment and transfer of control. The majority of products and services offered by us have readily observable selling prices. As a part of our stand-alone selling price policy, we review product pricing on a periodic basis to identify any significant changes and revise our expected selling price assumptions as appropriate. We record taxes collected on revenue-producing activities on a net basis. Revenue recognition at a point in time Revenues recognized at a point in time consist primarily of product, installation and training. The majority of our sales are made to original equipment manufacturers ("OEMs"), distributors, representatives and end-users. Sales made to customers generally do not require installation of the products by us and are not subject to other post-delivery obligations. Sales to end-users in the scientific market typically require installation by us and, thus, involve post-delivery obligations; however, our post-delivery installation obligations are not essential to the functionality of our products and represent a separate performance obligation. We recognize revenue for these sales following the transfer of control of such products to the customer, which typically occurs upon shipment or delivery depending on the terms of the underlying contracts. In those instances that we have agreed to perform installation or provide training, we defer revenue related to installation or training until these services have been rendered. Our sales to distributors, representatives and end-user customers typically do not have customer acceptance provisions and only certain of our sales to OEM customers and integrators have customer acceptance provisions. Customer acceptance is generally limited to performance under our published product specifications. For the few product sales that have customer acceptance provisions because of more advanced performance than our published specifications, the revenue is recognized when the control transfers or the revenue is deferred until customer acceptance occurs. Revenue recognition over time We periodically enter into contracts in which a customer may purchase a combination of goods and/or services, such as products with maintenance contracts or extended warranty. These contracts are evaluated to determine if the multiple promises are separate performance obligations. Once we determine the performance obligations, we then determine the transaction price, which includes estimating the amount of variable consideration, if any. We then allocate the transaction price to each performance obligation in the contract based on a relative stand-alone selling price charged separately to customers. Extended warranties are sold separately from products and represent a distinct performance obligation. Revenue related to the performance obligation for extended warranties is recognized over time as the customer simultaneously receives and consumes the benefits provided by us. Customized products, for which we have an enforceable right to payment for performance completed to date, are recorded over time. We use the output method to recognize revenue over time for such contracts as it best depicts the satisfaction of our performance obligations. Shipping and handling costs We record costs related to shipping and handling of net sales in cost of sales for all periods presented. Shipping and handling fees billed to customers are included in net sales. Customs duties billed to customers are recorded in cost of sales. Warranty We provide warranties on the majority of our product sales and reserves for estimated warranty costs are recorded during the period of sale. These standard warranties are assurance type warranties and do not offer any services beyond the assurance that the product will continue working as specified. Therefore, these warranties are not considered separate performance obligations in the arrangement. Instead, the expected cost of the warranty is accrued as an expense. The determination of such reserves requires us to make estimates of product return rates and expected costs to repair or replace the products under warranty. We currently establish warranty reserves based on historical warranty costs for each product line. The weighted average warranty period covered is approximately 15 to 18 months. If actual return rates and/or repair and replacement costs differ significantly from our estimates, adjustments to cost of sales may be required in future periods. Costs of obtaining a contract We recognize the incremental direct costs of obtaining a contract from a customer as an expense, which primarily includes sales commissions. Sales commissions are recorded at a point of time when control of the product transfers or over a period of time when sales commission provided is expected to be recovered through future services. The costs are recorded within selling, general and administrative expense. Costs incurred prior to the transfer of control of the product to the customer and costs to be amortized over a future period are classified as a prepaid asset and are included in prepaid expenses and other assets. Upon adoption of ASC 606, we determined there was an immaterial impact on sales commissions and therefore, we did not record a transition adjustment on adoption. For fiscal 2021 and 2020, costs of obtaining a contract to be amortized over a future period of $0.2 million and $0.3 million were classified as a prepaid asset and are included in prepaid expenses and other assets, respectively. Payment terms Our standard payment terms are 30 days but vary by the industry and location of the customer and the products or services offered. The time between invoicing and when payment is due is not significant. As our standard payment terms are less than one year, we have elected the practical expedient under ASC 606-10-32-18 and therefore are not required to assess whether each contract has a significant financing component. Customer deposits and deferred revenue When we receive consideration from a customer prior to transferring goods or services under the terms of a sales contract, we record customer deposits or deferred revenue, depending on whether or not the product has shipped to the customer, which are included in other current liabilities or other long-term liabilities when the payment is made or due, whichever is earlier. We recognize deferred revenue as net sales after control of the goods or services has been transferred to the customer and all revenue recognition criteria are met. |
Research and Development | Research and Development Research and development expenses include salaries, contractor and consultant fees, supplies and materials, as well as costs related to other overhead such as depreciation, facilities, utilities and other departmental expenses. The costs we incur with respect to internally developed technology and engineering services are included in research and development expenses as incurred as they do not directly relate to any particular licensee, license agreement or license fee. |
Foreign Currency Translation | Foreign Currency Translation The functional currencies of our foreign subsidiaries are generally their respective local currencies. Accordingly, gains and losses from the translation of the financial statements of the foreign subsidiaries are reported as a separate component of accumulated other comprehensive income ("OCI"). Foreign currency transaction gains and losses are included in earnings. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. Accumulated other comprehensive income (loss) (net of tax) at fiscal 2021 year-end was substantially comprised of accumulated translation adjustments of $20.4 million and deferred actuarial losses on pension plans of $0.4 million. Accumulated other comprehensive loss (net of tax) at fiscal 2020 year-end was substantially comprised of accumulated translation adjustments of $25.1 million and deferred actuarial losses on pension plans of $0.5 million. |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed based on the weighted average number of shares outstanding during the period, excluding unvested restricted stock. Diluted earnings per share is computed based on the weighted average number of shares outstanding during the period increased by the effect of dilutive employee stock awards, including restricted stock awards and stock purchase plan contracts, using the treasury stock method. |
Stock-Based Compensation | Stock-Based Compensation We recognize compensation expense for all share-based payment awards based on the fair value of such awards. We value restricted stock units using the intrinsic value method, which is based on the fair market value price on the grant date. We use a Monte Carlo simulation model to estimate the fair value of performance restricted stock units whose number of units vesting is based on our total shareholder return over the performance period compared to the Russell Index. In fiscal 2020, we valued certain performance restricted stock units with vesting based on goals related to free cash flow target amounts units using the intrinsic value method, which is based on the fair market value price on the grant date. We amortize the fair value of stock awards on a straight-line basis over the requisite service periods of the awards, which are generally the vesting periods. See Note 12, "Employee Stock Award and Benefit Plans" for a description of our stock-based employee compensation plans and the assumptions we use to calculate the fair value of stock-based employee compensation. |
Income Taxes | Income Taxes As part of the process of preparing our consolidated financial statements, we are required to estimate our income tax provision (benefit) in each of the jurisdictions in which we operate. This process involves us estimating our current income tax provision (benefit) together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included within our consolidated balance sheets. We account for uncertain tax issues pursuant to ASC 740-10 Income Taxes , which creates a single model to address accounting for uncertainty in tax positions by prescribing a minimum recognition threshold that a tax position is required to meet before being recognized in the financial statements. This standard provides a two-step approach for evaluating tax positions. The first step, recognition, occurs when a company concludes (based solely on the technical aspects of the matter) that a tax position is more likely than not to be sustained upon examination by a taxing authority. The second step, measurement, is only considered after step one has been satisfied and measures any tax benefit at the largest amount that is deemed more likely than not to be realized upon ultimate settlement of the uncertainty. These determinations involve significant judgment by management. Tax positions that fail to qualify for initial recognition are recognized in the first subsequent interim period that they meet the more likely than not standard or when they are resolved through negotiation or litigation with factual interpretation, judgment and certainty. Tax laws and regulations themselves are complex and are subject to change as a result of changes in fiscal policy, changes in legislation, evolution of regulations and court filings. Therefore, the actual liability for U.S. or foreign taxes may be materially different from our estimates, which could result in the need to record additional tax liabilities or potentially to reverse previously recorded tax liabilities. We record a valuation allowance to reduce our deferred tax assets to an amount that more likely than not will be realized. While we have considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the valuation allowance, in the event we were to determine that we would be able to realize our deferred tax assets in the future in excess of our net recorded amount, an adjustment to the allowance for the deferred tax asset would increase income in the period such determination was made. Likewise, should we determine that we would not be able to realize all or part of our net deferred tax asset in the future, an adjustment to the allowance for the deferred tax asset would be charged to income in the period such determination was made. We historically asserted our intention to indefinitely reinvest foreign earnings. As a result of enactment of the Tax Cuts and Jobs Act (the “Tax Act”) and certain foreign tax law changes, we no longer consider foreign earnings to be indefinitely reinvested in our foreign subsidiaries. As a result of this change in assertion, we recorded a $18.4 million tax expense against our foreign earnings that are not indefinitely reinvested as of fiscal 2021. This is mainly related to foreign withholding taxes and state income taxes. We have not recognized any deferred taxes for outside basis differences in foreign subsidiaries. |
Adoption of New Accounting Pronouncement and Recently Issued Accounting Pronouncements | Adoption of New Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and a subsequent amendment, ASU 2018-19 (collectively, "Topic 326"). Topic 326 requires measurement and recognition of expected credit losses for financial assets held. We adopted ASU 2016-13 in the first quarter of fiscal 2021 with no material impact to our consolidated financial statements. With the adoption of Topic 326, we are now assessing whether unrealized losses have resulted from or are expected to result from a credit loss or other factors. We believe none of our unrealized losses on available-for-sale investments were other-than temporary or were attributable to credit losses as of October 2, 2021 and October 3, 2020. We review our available-for-sale investments on a quarterly basis to identify a potential other-than-temporary impairment. We also do not have an intent to sell our investments and would not be required to sell them before they recover. The adoption of Topic 326 did not significantly change our approach to the valuation of trade receivables. We determine whether there is an expected loss on our accounts receivable by reviewing all available data, including our customers' latest available financial statements, their credit standing and our historical collection experience, as well as current and future market and economic conditions. As of October 2, 2021 and October 3, 2020, the allowance for credit losses on our trade receivables was $4.4 million and $5.4 million, respectively. Recently Issued Accounting Pronouncements In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform ("Topic 848"). Topic 848 provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate ("LIBOR") or by another reference rate expected to be discontinued. The guidance was effective beginning March 12, 2020 and can be applied prospectively through December 31, 2022. In January 2021, the FASB issued ASU 2021-01, "Reference Rate Reform - Scope," which clarified the scope and application of the original guidance. We will adopt these standards when LIBOR is discontinued and do not expect them to have a material impact on our consolidated financial statements or related disclosures. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of activity in accounts receivable allowance | Activity in accounts receivable allowance is as follows (in thousands): Fiscal 2021 2020 2019 Beginning balance $ 7,630 $ 8,690 $ 4,568 Additions charged to expenses 1,261 2,630 5,210 Deductions from reserves (2,286) (3,690) (1,088) Ending balance $ 6,605 $ 7,630 $ 8,690 |
Schedule of inventories | Inventories are as follows (in thousands): Fiscal year-end 2021 2020 Purchased parts and assemblies $ 107,965 $ 116,957 Work-in-process 168,775 173,871 Finished goods 115,501 135,928 Total inventories $ 392,241 $ 426,756 |
Schedule of property and equipment cost, accumulated depreciation and amortization and estimated useful lives | Cost, accumulated depreciation and amortization, and estimated useful lives are as follows (dollars in thousands): Fiscal year-end 2021 2020 Useful Life Land $ 19,002 $ 19,576 Buildings and improvements 213,698 169,748 5-40 years Equipment, furniture and fixtures 401,391 364,376 3-10 years Leasehold improvements 76,987 72,474 shorter of asset life or lease term 711,078 626,174 Accumulated depreciation and amortization (408,465) (380,496) Property and equipment, net $ 302,613 $ 245,678 |
Schedule of reconciliation of changes in asset retirement liability | The following table reconciles changes in our asset retirement liability for fiscal 2021 and 2020 (in thousands): Asset retirement liability as of September 28, 2019 $ 5,074 Reduction to asset retirement obligations (32) Adjustments and additions to asset retirement obligations recognized 813 Accretion recognized 161 Changes due to foreign currency exchange 163 Asset retirement liability as of October 3, 2020 6,179 Reduction to asset retirement obligations (248) Adjustments and additions to asset retirement obligations recognized 305 Additional asset retirement obligations due to acquisition 16 Accretion recognized 149 Changes due to foreign currency exchange (9) Asset retirement liability as of October 2, 2021 $ 6,392 |
Schedule of components of reserve for warranty costs | Components of the reserve for warranty costs during fiscal 2021, 2020, and 2019 were as follows (in thousands): Fiscal 2021 2020 2019 Beginning balance $ 35,032 $ 36,460 $ 40,220 Additions related to current period sales 31,655 37,788 52,271 Warranty costs incurred in the current period (35,781) (40,724) (54,538) Accruals resulting from acquisitions 170 — 21 Adjustments to accruals related to foreign exchange and other (19) 1,508 (1,514) Ending balance $ 31,057 $ 35,032 $ 36,460 |
Schedule of information necessary to calculate basic and diluted earnings (loss) per share | The following table presents information necessary to calculate basic and diluted earnings per share (in thousands, except per share data): Fiscal 2021 2020 2019 Weighted average shares outstanding—basic 24,390 24,105 24,118 Dilutive effect of employee stock awards — — 161 Weighted average shares outstanding—diluted 24,390 24,105 24,279 Net income (loss) $ (106,751) $ (414,139) $ 53,825 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Revenue from Contracts with Customers | The following tables summarize revenue from contracts with customers (in thousands): Sales by revenue type and segment Fiscal 2021 2020 2019 OEM Laser Sources Industrial Lasers & Systems OEM Laser Sources Industrial Lasers & Systems OEM Laser Sources Industrial Lasers & Systems Net sales: Products (1) $ 550,690 $ 465,002 $ 441,476 $ 369,342 $ 532,863 $ 430,878 Other product and service revenues (2) 362,946 108,830 317,453 100,728 353,813 113,086 Total net sales $ 913,636 $ 573,832 $ 758,929 $ 470,070 $ 886,676 $ 543,964 (1) Net sales primarily recognized at a point in time. (2) Includes sales of spare parts, related accessories, and other consumable parts as well as revenues from service agreements, of which $67.4 million for fiscal 2021 was recognized over time. Sales by market application and segment Fiscal 2021 2020 2019 OEM Laser Sources Industrial Lasers & Systems OEM Laser Sources Industrial Lasers & Systems OEM Laser Sources Industrial Lasers & Systems Net sales: Microelectronics $ 551,032 $ 113,503 $ 466,780 $ 71,755 $ 568,387 $ 63,789 Precision manufacturing 56,074 342,975 36,129 299,621 38,017 366,861 Instrumentation 292,561 81,514 234,078 66,243 258,624 79,741 Aerospace and defense 13,969 35,840 21,942 32,451 21,648 33,573 Total net sales $ 913,636 $ 573,832 $ 758,929 $ 470,070 $ 886,676 $ 543,964 |
Summary of Customer Deposits and Deferred Revenue | A rollforward of our customer deposits and deferred revenue are as follows (in thousands): Fiscal year-end 2021 2020 Beginning balance $ 56,339 $ 42,550 Amount of customer deposits and deferred revenue recognized in income (217,835) (171,521) Additions to customer deposits and deferred revenue 226,959 183,604 Translation adjustments (59) 1,706 Ending balance $ 65,404 $ 56,339 |
Summary of Estimated Revenue Expected to be Recognized in the Future | The following table includes estimated revenue expected to be recognized in the future related to performance obligations for sales of maintenance agreements, extended warranties, installation, and contracts with customer acceptance provisions included in customer deposits and deferred revenue as follows (in thousands): 1 year Thereafter Total Performance obligations as of October 2, 2021 $ 49,445 $ 15,959 $ 65,404 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Business Combinations [Abstract] | |
Schedule of business acquisitions, by acquisition | Our allocation of the purchase price is as follows (in thousands): Tangible assets: Cash $ 537 Accounts receivable 1,763 Inventories 5,269 Prepaid expenses and other assets 823 Property and equipment 18,713 Liabilities assumed (1,856) Deferred tax liabilities (4,088) Intangible assets: Existing technology 2,800 In-process research and development 300 Customer relationships 300 Trademarks 100 Backlog 100 Goodwill 4,586 Total $ 29,347 Our allocation of the purchase price is as follows (in thousands): Tangible assets: Cash $ 103 Accounts receivable 534 Inventories 1,793 Prepaid expenses and other assets 17 Deferred tax assets 681 Property and equipment 122 Liabilities assumed (499) Intangible assets: Existing technology 5,600 Customer relationships 300 Goodwill 3,333 Total $ 11,984 Our allocation of the purchase price is as follows (in thousands): Tangible assets: Property and equipment $ 2,770 Intangible assets: Existing technology 1,600 Customer relationships 230 Production know-how 2,300 Backlog 100 Total $ 7,000 |
Fair Values (Tables)
Fair Values (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial assets and liabilities measured at fair value | Financial assets and liabilities measured at fair value as of October 2, 2021 and October 3, 2020 are summarized below (in thousands): Aggregate Fair Value Quoted Prices Significant Aggregate Fair Value Quoted Prices Significant Fiscal year-end 2021 Fiscal year-end 2020 (Level 1) (Level 2) (Level 1) (Level 2) Assets: Cash equivalents: Money market fund deposits $ 112,748 $ 112,748 $ — $ 36,646 $ 36,646 $ — Certificates of deposit 42,506 42,506 — 56,191 56,191 — Short-term investments: U.S. Treasury and agency obligations (1) — — — 35,346 — 35,346 Prepaid and other assets: Foreign currency contracts (2) 783 — 783 812 — 812 Money market fund deposits — Deferred comp and supplemental plan (3) 463 463 — 203 203 — Mutual funds — Deferred comp and supplemental plan (3) 15,443 15,443 — 22,778 22,778 — Total $ 171,943 $ 171,160 $ 783 $ 151,976 $ 115,818 $ 36,158 Liabilities: Other current liabilities: Foreign currency contracts (2) (4,253) — (4,253) (2,811) — (2,811) Total $ 167,690 $ 171,160 $ (3,470) $ 149,165 $ 115,818 $ 33,347 ___________________________________________________ (1) Valuations are based upon quoted market prices in active markets involving similar assets. The market inputs used to value these instruments generally consist of market yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Pricing sources include industry standard data providers, security master files from large financial institutions, and other third party sources which are input into a distribution-curve-based algorithm to determine a daily market value. This creates a "consensus price" or a weighted average price for each security. (2) The principal market in which we execute our foreign currency contracts is the institutional market in an over-the-counter environment with a relatively high level of price transparency. The market participants usually are large commercial banks. Our foreign currency contracts' valuation inputs are based on quoted prices and quoted pricing intervals from public data sources and do not involve management judgment. See Note 7, "Derivative Instruments and Hedging Activities." |
Short-Term Investments (Tables)
Short-Term Investments (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of cash, cash equivalents and short-term investments | Cash, cash equivalents and short-term investments consist of the following (in thousands): Fiscal 2021 year-end Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents $ 456,534 $ — $ — $ 456,534 Fiscal 2020 year-end Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents $ 440,258 $ — $ — $ 440,258 Short-term investments: Available-for-sale securities: U.S. Treasury and agency obligations $ 35,311 $ 36 $ (1) $ 35,346 Total short-term investments $ 35,311 $ 36 $ (1) $ 35,346 |
Debt Securities, Available-for-sale | Cash, cash equivalents and short-term investments consist of the following (in thousands): Fiscal 2021 year-end Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents $ 456,534 $ — $ — $ 456,534 Fiscal 2020 year-end Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents $ 440,258 $ — $ — $ 440,258 Short-term investments: Available-for-sale securities: U.S. Treasury and agency obligations $ 35,311 $ 36 $ (1) $ 35,346 Total short-term investments $ 35,311 $ 36 $ (1) $ 35,346 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of outstanding notional contract and fair value amount of hedge contracts | The total outstanding notional contract and fair value asset (liability) amounts of non-designated hedge contracts, with maximum maturity of two months, are as follows (in thousands): U.S. Notional Contract Value U.S. Fair Value Fiscal 2021 year-end Fiscal 2020 year-end Fiscal 2021 year-end Fiscal 2020 year-end Foreign currency hedge contracts Purchase $ 236,943 $ 169,206 $ (4,108) $ (1,802) Sell $ (64,308) $ (166,813) $ 638 $ (197) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in carrying amount of goodwill by segment | The changes in the carrying amount of goodwill by segment for fiscal 2021 and 2020 are as follows (in thousands): Industrial Lasers & System OEM Laser Sources Total Balance as of September 28, 2019 $ 330,281 $ 96,820 $ 427,101 Impairment charges (327,203) — (327,203) Translation adjustments (3,078) 4,497 1,419 Balance as of October 3, 2020 — 101,317 101,317 Additions — 4,586 4,586 Translation adjustments — (642) (642) Balance as of October 2, 2021 $ — $ 105,261 $ 105,261 |
Schedule of components of amortizable intangible assets | The components of our amortizable intangible assets are as follows (in thousands): Fiscal year-end 2021 Fiscal year-end 2020 Gross Accumulated Net Gross Accumulated Net Existing technology $ 39,524 $ (35,522) $ 4,002 $ 46,547 $ (37,630) $ 8,917 Customer relationships 22,101 (12,586) 9,515 24,388 (12,923) 11,465 Production know-how 2,300 (1,377) 923 2,300 (917) 1,383 In-process research and development 300 — 300 — — — Total $ 64,225 $ (49,485) $ 14,740 $ 73,235 $ (51,470) $ 21,765 |
Schedule of estimated amortization expense | Estimated amortization expense for the next five fiscal years and all years thereafter are as follows (in thousands): Estimated 2022 $ 3,978 2023 3,407 2024 2,625 2025 2,306 2026 1,969 Thereafter 155 Total (1) $ 14,440 (1) Excluding in-process research & development. |
Balance Sheet Details (Tables)
Balance Sheet Details (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of prepaid expenses and other assets | Prepaid expenses and other assets consist of the following (in thousands): Fiscal year-end 2021 2020 Prepaid and refundable income taxes $ 34,979 $ 50,548 Other taxes receivable 15,568 13,006 Prepaid expenses and other assets 29,047 24,696 Total prepaid expenses and other assets $ 79,594 $ 88,250 |
Schedule of other assets | Other assets consist of the following (in thousands): Fiscal year-end 2021 2020 Assets related to deferred compensation arrangements (see Note 12) $ 37,410 $ 39,720 Deferred tax assets (see Note 16) 153,685 102,028 Right of use assets, net - operating leases (See Note 11) 76,670 85,905 Right of use assets, net - finance leases (See Note 11) 26 656 Other assets (1) 14,780 14,266 Total other assets $ 282,571 $ 242,575 |
Schedule of other liabilities | Other current liabilities consist of the following (in thousands): Fiscal year-end 2021 2020 Accrued payroll and benefits $ 101,380 $ 54,211 Operating lease liability, current (see Note 11) 15,230 15,366 Finance lease liability, current (see Note 11) 22 399 Accrued expenses and other 41,156 36,432 Warranty reserve (see Note 2) 31,057 35,032 Customer deposits 19,364 9,717 Deferred revenue 30,081 32,998 Total other current liabilities $ 238,290 $ 184,155 Other long-term liabilities consist of the following (in thousands): Fiscal year-end 2021 2020 Long-term taxes payable $ 17,634 $ 15,374 Operating lease liability, long-term (see Note 11) 65,479 75,264 Finance lease liability, long-term (see Note 11) — 178 Deferred compensation (see Note 12) 39,693 42,854 Deferred tax liabilities (see Note 16) 19,356 15,721 Deferred revenue 15,959 13,624 Asset retirement obligations liability (see Note 2) 5,991 5,892 Defined benefit plan liabilities (see Note 17) 44,110 45,810 Other long-term liabilities 4,508 6,357 Total other long-term liabilities $ 212,730 $ 221,074 |
Borrowings Short term borrowing
Borrowings Short term borrowing and current portion of long term debt (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of short-term debt | Short-term borrowings and current portion of long-term obligations consist of the following (in thousands): Fiscal year-end 2021 2020 Current portion of Euro Term Loan (1) $ 4,972 $ 4,970 1.3% Term loan due 2024 1,448 1,465 1.0% State of Connecticut term loan due 2023 386 382 Facility construction loan in Germany due 2030 1,589 — Line of credit borrowings 10,000 10,000 Total short-term borrowings and current portion of long-term obligations $ 18,395 $ 16,817 (1) Net of debt issuance costs of $2.8 million and $2.9 million at October 2, 2021 and October 3, 2020, respectively. |
Schedule of long-term debt | Long-term obligations consist of the following (in thousands): Fiscal year-end 2021 2020 Euro Term Loan due 2024 (1) $ 396,429 $ 406,099 1.3% Term loan due 2024 2,896 4,395 1.0% State of Connecticut term loan due 2023 260 646 Facility construction loan in Germany due 2030 26,215 — Total long-term obligations $ 425,800 $ 411,140 ( 1) Net of debt issuance costs of $3.0 million and $5.9 million at October 2, 2021 and October 3, 2020, respectively. |
Schedule of contractual maturities of debt obligations | Contractual maturities of our debt obligations, excluding line of credit borrowings, as of October 2, 2021 are as follows (in thousands): Amount 2022 $ 11,183 2023 12,649 2024 396,314 2025 3,178 2026 3,178 Thereafter 13,505 Total $ 440,007 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Leases [Abstract] | |
Lease, Cost | The components of operating lease costs (in thousands), lease term (in years) and discount rate are as follows: Fiscal 2021 2020 Operating lease cost $ 22,601 $ 19,629 Variable lease cost 1,329 1,421 Short-term lease cost 52 459 Sublease income (9) (126) Total lease cost $ 23,973 $ 21,383 Fiscal year-end 2021 2020 Weighted average remaining lease term 7.3 7.8 Weighted average discount rate 5.0 % 4.9 % Supplemental cash flow information related to leases are as follows (in thousands): Fiscal 2021 2020 Operating cash outflows from operating leases $ 22,667 $ 19,391 ROU assets obtained in exchange for new operating lease liabilities 11,565 10,884 |
Lessee, Operating Lease, Liability, Maturity | As of October 2, 2021, maturities of our operating lease liabilities, which do not include short-term leases and variable lease payments are as follows (in thousands): Operating Leases 2022 $ 18,279 2023 16,546 2024 14,304 2025 11,718 2026 8,978 2027 and thereafter 29,702 Total minimum lease payments 99,527 Amounts representing interest (18,818) Present value of total operating lease liabilities $ 80,709 |
Employee Stock Award and Bene_2
Employee Stock Award and Benefit Plans (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of deferred compensation plans' investments and liabilities | These investments and the liability to the employees were as follows (in thousands): Fiscal year-end 2021 2020 Cash surrender value of life insurance contracts $ 23,040 $ 18,520 Fair value of mutual and money market funds 15,906 22,981 Total assets $ 38,946 $ 41,501 Total assets, included in: Prepaid expenses and other assets $ 1,536 $ 1,781 Other assets 37,410 39,720 Total assets $ 38,946 $ 41,501 Fiscal year-end 2021 2020 Total deferred compensation liability, included in: Other current liabilities $ 1,536 $ 1,781 Other long-term liabilities 39,693 42,854 Total deferred compensation liability $ 41,229 $ 44,635 |
Schedule of weighted-average assumptions used to estimate fair value of stock options granted and shares purchased | The fair values of shares purchased under the employee stock purchase plan for fiscal 2021, 2020, and 2019 were estimated using the following weighted-average assumptions: Employee Stock Purchase Plans Fiscal 2021 2020 2019 Expected life in years 0.5 0.5 0.5 Expected volatility 52.6 % 58.0 % 47.9 % Risk-free interest rate 0.1 % 1.0 % 2.4 % Weighted average fair value per share $ 55.64 $ 43.54 $ 40.77 |
Schedule of Share-based Payment Award, Restricted Stock Units, Valuation Assumptions | The weighted average fair value for the performance units was determined using a Monte Carlo simulation model incorporating the following weighted average assumptions: Fiscal 2021 2020 2019 Risk-free interest rate 0.2 % 0.8 % 2.9 % Volatility 51.7 % 50.5 % 43.7 % Weighted average fair value $ 119.54 $ 161.46 $ 117.43 |
Schedule of stock-based compensation expense | The following table shows total stock-based compensation expense and related tax benefits included in the Consolidated Statements of Operations for fiscal 2021, 2020, and 2019 (in thousands): Fiscal 2021 2020 2019 Cost of sales $ 7,675 $ 5,314 $ 4,880 Research and development 4,463 4,478 2,990 Selling, general and administrative 29,267 34,995 28,596 Income tax benefit (5,387) (5,640) (4,946) $ 36,018 $ 39,147 $ 31,520 |
Schedule of restricted stock award and restricted stock unit activity | The following table summarizes the activity of our time-based and performance restricted stock units for fiscal 2021, 2020, and 2019 (in thousands, except per share amounts): Time Based Restricted Stock Units Performance Restricted Stock Units Number of Weighted Number of Weighted Nonvested stock at September 29, 2018 279 $ 155.24 159 $ 155.76 Granted 195 128.25 105 117.43 Vested (1) (169) 127.90 (131) 74.48 Forfeited (10) 170.97 — — Nonvested stock at September 28, 2019 295 $ 152.47 133 $ 184.26 Granted 284 141.05 84 152.96 Vested (1) (150) 150.91 (81) 163.17 Forfeited (10) 169.92 — — Nonvested stock at October 3, 2020 419 $ 144.87 136 $ 177.54 Granted 294 136.46 64 119.43 Vested (1) (229) 144.32 (12) 118.45 Forfeited (13) 134.64 (30) 315.05 Nonvested stock at October 2, 2021 471 $ 140.16 158 $ 131.90 __________________________________________ (1) Service-based restricted stock units vested during each fiscal year. Performance-based restricted stock units are included at 100% of target goal. Under the terms of the market-based awards, the recipient may earn between 0% and 200% of the award. Under the terms of the fiscal 2020 performance-based awards based on free cash flow targets, the recipient may earn between 0% and 100% of the award. |
Other Income (Expense), Net (Ta
Other Income (Expense), Net (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Other Income and Expenses [Abstract] | |
Schedule of other nonoperating income (expense) | Other income (expense) includes other-net which is comprised of the following (in thousands): Fiscal 2021 2020 2019 Foreign exchange loss $ (4,972) $ (3,486) $ (5,774) Gain on deferred compensation investments, net (Note 12) 9,774 6,099 1,140 Translation adjustment related to the dissolution of certain entities (1) (5,291) — — Other 765 828 (410) Other—net $ 276 $ 3,441 $ (5,044) (1) In the fourth quarter of fiscal 2021, the Company had substantially completed the liquidation of several operations, primarily OR Laser, and recognized in other income (expense) the net accumulated translation losses for these subsidiaries previously recorded in accumulated other comprehensive income (loss) on the consolidated balance sheet. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The provision for (benefit from) income taxes on income (loss) before income taxes consists of the following (in thousands): Fiscal 2021 2020 2019 Currently payable: Federal $ 4,929 $ (1,660) $ 1,995 State 390 471 557 Foreign 33,713 1,176 13,448 39,032 (13) 16,000 Deferred and other: Federal (47,908) (2,343) (407) State (4,872) (1,605) 516 Foreign 4,961 (24,623) (9,886) (47,819) (28,571) (9,777) Provision for (benefit from) income taxes $ (8,787) $ (28,584) $ 6,223 |
Schedule of Income before Income Tax, Domestic and Foreign | The components of income before income taxes consist of (in thousands): Fiscal 2021 2020 2019 United States $ (207,827) $ (98,900) $ 54,480 Foreign 92,289 (343,823) 5,568 Income (loss) before income taxes $ (115,538) $ (442,723) $ 60,048 |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of the income tax expense (benefit) at the U.S. Federal statutory rate (21.0%) to actual income tax expense (benefit) is as follows (in thousands): Fiscal 2021 2020 2019 Federal statutory tax expense (benefit) $ (24,263) $ (92,972) $ 12,610 Valuation allowance 14,925 15,231 7,925 Taxes on foreign earnings at rates greater (less) than U.S. rates, net 8,326 (27,041) (8,210) Stock-based compensation 4,351 3,640 556 State income taxes, net of federal income tax benefit (4,215) (1,249) 1,131 Research and development credit (4,279) (4,350) (3,665) Deferred compensation (1,050) (564) (206) Release of unrecognized tax benefits (1,957) (20,027) (6,688) Release of interest accrued for unrecognized tax benefits (328) (4,232) (205) Reversal of competent authority — 8,552 — Deferred taxes on foreign earnings 2,302 1,303 1,215 Write-off of withholding tax credits — — 1,134 Goodwill impairment — 89,962 — FDII deduction (2,791) — 536 Other, net 192 3,163 90 Provision for (benefit from) income taxes $ (8,787) $ (28,584) $ 6,223 Effective tax rate 7.6 % 6.5 % 10.4 % |
Schedule of Deferred Tax Assets and Liabilities | The significant components of deferred tax assets and liabilities were (in thousands): Fiscal year-end 2021 2020 Deferred tax assets: Reserves and accruals not currently deductible $ 49,027 $ 28,520 Operating loss carryforwards and tax credits 73,902 83,447 Deferred revenue 5,785 4,412 Depreciation and amortization 12,311 14,362 Inventory capitalization 3,509 — Stock-based compensation 3,452 4,906 Competent authority offset to transfer pricing tax reserves 3,972 4,283 Accumulated translation adjustment 3,970 2,508 Retirement and pension 16,303 17,982 Lease liabilities 20,080 21,737 Acquisition costs 52,629 — Other — 165 Total gross deferred tax assets 244,940 182,322 Valuation allowance (73,166) (57,707) Total net deferred tax assets 171,774 124,615 Deferred tax liabilities: Deferred tax liabilities on foreign earnings 18,381 16,055 Inventory capitalization — 1,394 Right of use assets 19,040 20,859 Other 24 — Total gross deferred tax liabilities 37,445 38,308 Net deferred tax assets $ 134,329 $ 86,307 |
Schedule of Deferred Tax Assets | The net deferred tax asset is classified on the consolidated balance sheets as follows (in thousands): Fiscal year-end 2021 2020 Non-current deferred income tax assets $ 153,685 $ 102,028 Non-current deferred income tax liabilities (19,356) (15,721) Net deferred tax assets $ 134,329 $ 86,307 |
Schedule of Unrecognized Tax Benefits Roll Forward | A reconciliation of the change in gross unrecognized tax benefits, excluding interest and penalties, is as follows (in thousands): Fiscal 2021 2020 2019 Balance as of the beginning of the year $ 39,507 $ 58,111 $ 65,882 Tax positions related to current year: Additions 1,017 1,410 605 Tax positions related to prior year: Additions 1,440 86 448 Reductions (6) (17) (6,071) Lapses in statutes of limitations (2,017) (1,211) (639) Decrease in unrecognized tax benefits based on settlement — (19,463) — Foreign currency revaluation adjustment (54) 591 (2,114) Balance as of end of year $ 39,887 $ 39,507 $ 58,111 |
Summary of Income Tax Examinations | A summary of the fiscal tax years that remain subject to examination, as of October 2, 2021, for our major tax jurisdictions is: United States—Federal 2018—forward United States—Various States 2017—forward Netherlands 2016—forward Germany 2011—forward Japan 2015—forward South Korea 2016—forward United Kingdom 2020—forward |
Defined Benefit Plans (Tables)
Defined Benefit Plans (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Retirement Benefits [Abstract] | |
Schedule of Net Benefit Costs | Components of net periodic cost are as follows for fiscal 2021, 2020, and 2019 (in thousands): Fiscal 2021 2020 2019 Service cost $ 2,003 $ 2,153 $ 1,955 Interest cost 936 857 1,308 Expected return on plan assets (620) (682) (817) Recognized net actuarial (gain) loss (292) (690) 470 Foreign exchange impacts (82) 66 (79) Net periodic pension cost $ 1,945 $ 1,704 $ 2,837 |
Schedule of Changes in Projected Benefit Obligations | The changes in projected benefit obligations and plan assets, as well as the ending balance sheet amounts for our defined benefit plans, are as follows (in thousands): Fiscal year-end 2021 2020 Change in benefit obligation: Projected benefit obligation at beginning of year $ 60,607 $ 60,437 Service cost 2,003 2,153 Interest cost 936 857 Assumption change (443) (1,783) Experience loss 261 22 Foreign exchange rate impacts (704) 2,433 Benefits paid – total (2,327) (3,010) Settlement gain — (502) Projected benefit obligation at end of year $ 60,333 $ 60,607 Projected benefit obligation at end of year: U.S. plans $ 18,070 $ 18,775 Foreign plans 42,263 41,832 Projected benefit obligation at end of year $ 60,333 $ 60,607 Change in plan assets: Fair value of plan assets at beginning of year $ 12,901 $ 12,997 Actual return on plan assets 1,032 1,218 Employer contributions 87 208 Benefits paid – funded plan (607) (1,522) Fair value of plan assets at end of year $ 13,413 $ 12,901 Fair value of plan assets at end of year: U.S. plans $ 13,131 $ 12,645 Foreign plans 282 256 Fair value of plan assets at end of year 13,413 12,901 Unfunded status at end of year $ (46,920) $ (47,706) Amounts recognized in the consolidated balance sheet: Accrued benefit liability – current $ (2,810) $ (1,896) Accrued benefit liability – non current (44,110) (45,810) Accumulated other comprehensive loss (pre-tax) 190 456 |
Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets | The information for plans with an accumulated benefit obligation in excess of plan assets is as follows (in thousands): Fiscal year-end 2021 2020 Projected benefit obligation $ 60,333 $ 60,607 Accumulated benefit obligation 56,656 56,847 Fair value of plan assets 13,413 12,901 |
Weighted average rates to determine the net periodic benefit costs | The weighted-average rates used to determine the net periodic benefit costs are as follows: Fiscal 2021 2020 Discount rate: U.S. 2.6 % 2.3 % Foreign 1.2 % 1.2 % Expected return on plan assets: U.S. 5.0 % 5.0 % Rate of compensation increase U.S. — % — % Foreign 2.2 % 2.2 % |
Schedule of Expected Benefit Payments | Expected benefit payments for each of the next five fiscal years and the five years aggregated thereafter is as follows (in thousands): Amount 2022 $ 3,539 2023 2,370 2024 2,867 2025 2,925 2026 3,291 2027-2031 16,142 Total $ 31,134 |
Schedule of Allocation of Plan Assets | Our pension plan asset allocations at October 2, 2021 and October 3, 2020 by asset category are as follows: Allocation Target Fiscal 2021 Fiscal 2020 Equity securities 60 % 59 % 32 % Debt securities 40 % 41 % 68 % Total plan assets 100 % 100 % 100 % |
Fair value of pension plan assets | The fair values of our pension plan assets, by level within the fair value hierarchy, at October 2, 2021 are as follows: Asset categories Level 1 Level 2 Level 3 Total Cash and cash equivalents: Money market $ 2,731 $ — $ — $ 2,731 Equity securities: Small cap — — — — Mid cap — — — — Large cap — — — — Total market stock — 3,390 — 3,390 International — 1,751 — 1,751 Emerging markets — — — — Debt securities: Bonds and mortgages — 5,481 — 5,481 Inflation protected — — — — High yield — — — — Liability driven investments — 60 — 60 Total plan assets $ 2,731 $ 10,682 $ — $ 13,413 The fair values of our pension plan assets, by level within the fair value hierarchy, at October 3, 2020 are as follows: Asset categories Level 1 Level 2 Level 3 Total Cash and cash equivalents: Money market $ 469 $ — $ — $ 469 Equity securities: Small cap — 50 — 50 Mid cap — 143 — 143 Large cap — 293 — 293 Total market stock — 2,140 — 2,140 International — 1,166 — 1,166 Emerging markets — 197 — 197 Debt securities: Bonds and mortgages — 3,323 — 3,323 Inflation protected — — — — High yield — 272 — 272 Liability driven investments — $ 4,848 4,848 Total plan assets $ 469 $ 12,432 $ — $ 12,901 |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Segment Reporting [Abstract] | |
Schedule of sales and income (loss) from operations | The following table provides net sales and income (loss) from operations for our operating segments and a reconciliation of our total income (loss) from operations to income (loss) before income taxes (in thousands): Fiscal 2021 2020 2019 Net sales: OEM Laser Sources $ 913,636 $ 758,929 $ 886,676 Industrial Lasers & Systems 573,832 470,070 543,964 Total net sales $ 1,487,468 $ 1,228,999 $ 1,430,640 Income (loss) from operations: OEM Laser Sources $ 214,003 $ 169,883 $ 239,073 Industrial Lasers & Systems (1) 13,257 (518,186) (93,133) Corporate and other (2) (325,473) (81,877) (62,845) Total income (loss) from operations (98,213) (430,180) 83,095 Total other expense, net (17,325) (12,543) (23,047) Income (loss) before income taxes $ (115,538) $ (442,723) $ 60,048 (1) The fiscal 2020 loss includes non-cash pre-tax goodwill impairment charges of $327.2 million as well as non-cash pre-tax charges related to the impairment of intangible assets, property, plant and equipment and ROU assets of $33.9 million, $85.6 million, and $1.8 million, respectively. See Note 8, "Goodwill and Intangible Assets" in the Notes to Consolidated Financial Statements and Note 11, "Leases" in the Notes to Consolidated Financial Statements under Item 8 of this annual report. (2) The fiscal 2021 loss includes $236.0 million for merger and acquisition costs (primarily due to a $217.6 million termination fee paid to Lumentum). |
Schedule of sales to unaffiliated customers | Sales to unaffiliated customers are as follows (in thousands): Fiscal SALES 2021 2020 2019 United States $ 336,310 $ 296,102 $ 339,585 Foreign countries: South Korea 274,298 247,461 313,461 China 274,026 196,824 194,653 Japan 119,202 94,068 138,028 Asia-Pacific, other 136,942 94,835 93,389 Germany 139,240 117,170 145,285 Europe, other 138,144 125,739 148,680 Rest of World 69,306 56,800 57,559 Total foreign countries sales 1,151,158 932,897 1,091,055 Total sales $ 1,487,468 $ 1,228,999 $ 1,430,640 |
Schedule of long-lived assets by geographic region | Long-lived assets, which include all non-current assets other than goodwill, intangibles, non-current restricted cash, our investment in 3D-Micromac AG and deferred taxes, by geographic region, are as follows (in thousands): Fiscal year-end LONG-LIVED ASSETS 2021 2020 United States $ 185,953 $ 170,412 Foreign countries: Germany 157,199 123,019 Europe, other 35,142 35,810 Asia-Pacific 52,346 56,125 Total foreign countries long-lived assets 244,687 214,954 Total long-lived assets $ 430,640 $ 385,366 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 12 Months Ended |
Oct. 02, 2021 | |
Restructuring Charges [Abstract] | |
Restructuring and Related Costs | The following table presents our current liability as accrued on our balance sheets for restructuring charges. The table sets forth an analysis of the components of the restructuring charges and payments and other deductions made against the accrual for fiscal 2021 and fiscal 2020 (in thousands): Severance Related Asset Write-Offs Other Total Balances, September 28, 2019 $ 8,279 $ — $ 215 $ 8,494 Provision 2,468 2,194 629 5,291 Payments and other (8,136) (2,194) (614) (10,944) Balances, October 3, 2020 2,611 — 230 2,841 Provision 3,795 5,637 2,850 12,282 Payments and other (5,279) (5,637) (2,799) (13,715) Balances, October 2, 2021 $ 1,127 $ — $ 281 $ 1,408 |
Significant Accounting Polici_4
Significant Accounting Policies - Fiscal Year, Basis of Presentation, Cash Equivalents and Concentration of Credit Risk (Details) $ in Millions | 12 Months Ended | |
Oct. 02, 2021USD ($)months | Oct. 03, 2020 | |
Product Information [Line Items] | ||
Cash and cash equivalents held outside of U.S. | $ 310.6 | |
Cash and cash equivalents, foreign operations in foreign currency | $ 291.7 | |
Accounts receivable | Customer one | Customer concentration risk | ||
Product Information [Line Items] | ||
Concentration risk, percentage | 17.80% | 24.20% |
Maximum | ||
Product Information [Line Items] | ||
Highly liquid investments maturities (in months) | months | 3 |
Significant Accounting Polici_5
Significant Accounting Policies - Accounts receivable Allowances (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Accounts Receivable, Allowance for Doubtful Accounts [Roll Forward] | |||
Beginning balance | $ 7,630 | $ 8,690 | $ 4,568 |
Additions charged to expenses | 1,261 | 2,630 | 5,210 |
Deductions from reserves | (2,286) | (3,690) | (1,088) |
Ending balance | $ 6,605 | $ 7,630 | $ 8,690 |
Significant Accounting Polici_6
Significant Accounting Policies - Inventories (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Purchased parts and assemblies | $ 107,965 | $ 116,957 |
Work-in-process | 168,775 | 173,871 |
Finished goods | 115,501 | 135,928 |
Total inventories | $ 392,241 | $ 426,756 |
Significant Accounting Polici_7
Significant Accounting Policies - Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 02, 2021 | Oct. 03, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 711,078 | $ 626,174 |
Accumulated depreciation and amortization | (408,465) | (380,496) |
Property and equipment, net | $ 302,613 | 245,678 |
Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Product warranty, weighted average period | 15 months | |
Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Product warranty, weighted average period | 18 months | |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 19,002 | 19,576 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 213,698 | 169,748 |
Buildings and improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life | 5 years | |
Buildings and improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life | 40 years | |
Equipment, furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 401,391 | 364,376 |
Equipment, furniture and fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life | 3 years | |
Equipment, furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life | 10 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 76,987 | $ 72,474 |
Significant Accounting Polici_8
Significant Accounting Policies - Asset Retirement Obligations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 02, 2021 | Oct. 03, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Asset retirement obligation gross expected future cash flows | $ 6,800 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Asset retirement liability, beginning of period | 6,179 | $ 5,074 |
Reduction to asset retirement obligations | (248) | (32) |
Adjustments and additions to asset retirement obligations recognized | 305 | 813 |
Additional asset retirement obligations due to acquisition | 16 | |
Accretion recognized | 149 | 161 |
Changes due to foreign currency exchange | (9) | 163 |
Asset retirement liability, end of period | 6,392 | 6,179 |
Other current liabilities | ||
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Asset retirement liability, beginning of period | 300 | |
Asset retirement liability, end of period | 400 | 300 |
Other long-term liabilities | ||
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Asset retirement liability, beginning of period | 5,900 | |
Asset retirement liability, end of period | $ 6,000 | $ 5,900 |
Significant Accounting Polici_9
Significant Accounting Policies - Long-lived assets (Details) $ in Millions | 3 Months Ended |
Apr. 04, 2020USD ($) | |
Long-lived assets [Abstract] | |
Asset impairment charges | $ 2.5 |
Finite-Lived Intangible Assets | Industrial Lasers & System | |
Long-lived assets [Abstract] | |
Asset impairment charges | 33.9 |
Property and equipment | Industrial Lasers & System | |
Long-lived assets [Abstract] | |
Asset impairment charges | 85.6 |
Right-Of-Use Assets | Industrial Lasers & System | |
Long-lived assets [Abstract] | |
Asset impairment charges | $ 1.8 |
Significant Accounting Polic_10
Significant Accounting Policies - Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Apr. 04, 2020 | Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Goodwill [Line Items] | ||||
Impairment of goodwill | $ 0 | $ 327,203 | $ 0 | |
Industrial Lasers & System | ||||
Goodwill [Line Items] | ||||
Impairment of goodwill | $ 327,200 | $ 327,203 |
Significant Accounting Polic_11
Significant Accounting Policies - Intangible Assets (Details) | 12 Months Ended |
Oct. 02, 2021 | |
Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset, useful life | 4 years |
Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible asset, useful life | 15 years |
Significant Accounting Polic_12
Significant Accounting Policies - Warranty Reserves (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward] | |||
Beginning balance | $ 35,032 | $ 36,460 | $ 40,220 |
Additions related to current period sales | 31,655 | 37,788 | 52,271 |
Warranty costs incurred in the current period | (35,781) | (40,724) | (54,538) |
Accruals resulting from acquisitions | 170 | 0 | 21 |
Adjustments to accruals related to foreign exchange and other | (19) | 1,508 | (1,514) |
Ending balance | $ 31,057 | $ 35,032 | $ 36,460 |
Maximum | |||
Product warranty, weighted average period | 18 months | ||
Minimum | |||
Product warranty, weighted average period | 15 months |
Significant Accounting Polic_13
Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 02, 2021 | Oct. 03, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Increase (decrease) in prepaid expense and other assets | $ 0.2 | $ 0.3 |
Significant Accounting Polic_14
Significant Accounting Policies - Research and Development (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Research and development reimbursements | $ 2,100 | $ 3,400 | $ 3,800 |
Significant Accounting Polic_15
Significant Accounting Policies - Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | Oct. 02, 2021 | Oct. 03, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Translation adjustment functional to reporting currency, net of tax | $ (20.4) | $ (25.1) |
Deferred actuarial gain (loss) - pension plans | $ (0.4) | $ (0.5) |
Significant Accounting Polic_16
Significant Accounting Policies - Earnings Per Share (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Earnings Per Share [Abstract] | |||
Weighted average shares outstanding—basic (in shares) | 24,390,000 | 24,105,000 | 24,118,000 |
Dilutive effect of employee stock awards (in shares) | 0 | 0 | 161,000 |
Weighted average shares outstanding—diluted (in shares) | 24,390,000 | 24,105,000 | 24,279,000 |
Net income (loss) | $ (106,751) | $ (414,139) | $ 53,825 |
Dilutive securities excluded from calculation of dilutive shares (in shares) | 98,103 |
Significant Accounting Polic_17
Significant Accounting Policies - Income Taxes (Details) $ in Millions | 12 Months Ended |
Oct. 02, 2021USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Tax expense against our foreign earnings not indefinitely reinvested | $ 18.4 |
Significant Accounting Polic_18
Significant Accounting Policies - New Accounting Pronouncements (Details) - USD ($) $ in Millions | Oct. 02, 2021 | Oct. 03, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Allowance for Doubtful Accounts, Premiums and Other Receivables | $ (4.4) | $ (5.4) |
Revenue Recognition Disaggregat
Revenue Recognition Disaggregation of revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 1,487,468 | $ 1,228,999 | $ 1,430,640 |
OEM Laser Sources | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 913,636 | 758,929 | 886,676 |
Industrial Lasers & System | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 573,832 | 470,070 | 543,964 |
Products | OEM Laser Sources | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 550,690 | 441,476 | 532,863 |
Products | Industrial Lasers & System | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 465,002 | 369,342 | 430,878 |
Other products and services revenues | OEM Laser Sources | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 362,946 | 317,453 | 353,813 |
Other products and services revenues | Industrial Lasers & System | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 108,830 | 100,728 | 113,086 |
Sales of spare parts | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 67,400 | ||
Microelectronics | OEM Laser Sources | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 551,032 | 466,780 | 568,387 |
Microelectronics | Industrial Lasers & System | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 113,503 | 71,755 | 63,789 |
Materials processing | OEM Laser Sources | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 56,074 | 36,129 | 38,017 |
Materials processing | Industrial Lasers & System | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 342,975 | 299,621 | 366,861 |
OEM components and instrumentation | OEM Laser Sources | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 292,561 | 234,078 | 258,624 |
OEM components and instrumentation | Industrial Lasers & System | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 81,514 | 66,243 | 79,741 |
Scientific and government programs | OEM Laser Sources | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 13,969 | 21,942 | 21,648 |
Scientific and government programs | Industrial Lasers & System | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 35,840 | $ 32,451 | $ 33,573 |
Revenue Recognition Contract ba
Revenue Recognition Contract balances (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 02, 2021 | Oct. 03, 2020 | |
Change in Contract with Customer, Liability [Abstract] | ||
Contract with customer, beginning balance | $ 56,339 | $ 42,550 |
Amount of customer deposits and deferred revenue recognized in income | (217,835) | (171,521) |
Additions to customer deposits and deferred revenue | 226,959 | 183,604 |
Translation adjustments | (59) | 1,706 |
Contract with customer, ending balance | $ 65,404 | $ 56,339 |
Revenue Recognition Performance
Revenue Recognition Performance Obligations (Details) $ in Thousands | Oct. 02, 2021USD ($) |
Revenue from Contract with Customer [Abstract] | |
Performance Obligations | $ 65,404 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-03 | |
Revenue from Contract with Customer [Abstract] | |
Performance Obligations | $ 49,445 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-03 | |
Revenue from Contract with Customer [Abstract] | |
Performance Obligations | $ 15,959 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligation period | 2 years |
Business Combinations - Narrati
Business Combinations - Narrative (Details) - USD ($) | Apr. 19, 2021 | Mar. 25, 2021 | Mar. 09, 2021 | Jan. 18, 2021 | Oct. 05, 2018 | Oct. 02, 2021 |
Business Acquisition [Line Items] | ||||||
Payments for Merger Related Costs | $ 217,600,000 | |||||
Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset, useful life | 4 years | |||||
Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset, useful life | 15 years | |||||
Lumentum Holdings Inc. | ||||||
Business Acquisition [Line Items] | ||||||
Payments to Acquire Businesses, Gross | $ 175 | $ 100 | ||||
Business acquisition, share price (in dollars per share) | $ 1.0109 | $ 1.1851 | ||||
Payments for Merger Related Costs | $ 217,600,000 | |||||
II-VI Incorporated | ||||||
Business Acquisition [Line Items] | ||||||
Payments to Acquire Businesses, Gross | $ 220 | |||||
Business acquisition, share price (in dollars per share) | $ 0.91 | |||||
Electro-optics Technology, Inc. | ||||||
Business Acquisition [Line Items] | ||||||
Payments to Acquire Businesses, Gross | $ 29,300,000 | |||||
Acquisition Costs, Period Cost | $ 400,000 | |||||
Electro-optics Technology, Inc. | Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset, useful life | 1 year | |||||
Electro-optics Technology, Inc. | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset, useful life | 5 years | |||||
Ondax Inc. | ||||||
Business Acquisition [Line Items] | ||||||
Payments to Acquire Businesses, Gross | $ 12,000,000 | |||||
Ondax Inc. | Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset, useful life | 1 year | |||||
Ondax Inc. | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset, useful life | 8 years | |||||
Quantum Coating, Inc. | ||||||
Business Acquisition [Line Items] | ||||||
Payments to Acquire Businesses, Gross | $ 7,000,000 | |||||
Quantum Coating, Inc. | Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset, useful life | 1 year | |||||
Quantum Coating, Inc. | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible asset, useful life | 5 years |
Business Combinations - Allocat
Business Combinations - Allocation of Purchase Price (Details) - USD ($) | Oct. 02, 2021 | Apr. 19, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | Oct. 05, 2018 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 105,261,000 | $ 101,317,000 | $ 427,101,000 | ||
Electro-optics Technology, Inc. | |||||
Business Acquisition [Line Items] | |||||
Cash | $ 537,000 | ||||
Accounts receivable | 1,763,000 | ||||
Inventories | 5,269,000 | ||||
Prepaid expenses and other assets | 823,000 | ||||
Property and equipment | 18,713,000 | ||||
Liabilities assumed | (1,856,000) | ||||
Deferred tax liabilities | (4,088,000) | ||||
Goodwill | 4,586,000 | ||||
Total | 29,347,000 | ||||
Electro-optics Technology, Inc. | Existing technology | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 2,800,000 | ||||
Electro-optics Technology, Inc. | In-process research and development | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 300,000 | ||||
Electro-optics Technology, Inc. | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 300,000 | ||||
Electro-optics Technology, Inc. | Trademarks | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 100,000 | ||||
Electro-optics Technology, Inc. | Backlog | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | $ 100,000 | ||||
Ondax Inc. | |||||
Business Acquisition [Line Items] | |||||
Cash | $ 103,000 | ||||
Accounts receivable | 534,000 | ||||
Inventories | 1,793,000 | ||||
Prepaid expenses and other assets | 17,000 | ||||
Deferred tax assets | 681,000 | ||||
Property and equipment | 122,000 | ||||
Liabilities assumed | (499,000) | ||||
Goodwill | 3,333,000 | ||||
Total | 11,984,000 | ||||
Ondax Inc. | Existing technology | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 5,600,000 | ||||
Ondax Inc. | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 300,000 | ||||
Quantum Coating, Inc. | |||||
Business Acquisition [Line Items] | |||||
Property and equipment | 2,770,000 | ||||
Total | 7,000,000 | ||||
Quantum Coating, Inc. | Existing technology | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 1,600,000 | ||||
Quantum Coating, Inc. | Backlog | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 100,000 | ||||
Quantum Coating, Inc. | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 230,000 | ||||
Quantum Coating, Inc. | Production know-how | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | $ 2,300,000 |
Fair Values - Additional Inform
Fair Values - Additional Information (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Total | $ 440,007 | |
Current portion of long-term obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Total | 8,400 | $ 6,800 |
Long-term debt | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Total | $ 425,800 | $ 411,140 |
Fair Values - Schedule of finan
Fair Values - Schedule of financial assets and liabilities measured at fair value (Details) - Recurring - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 | |
Assets | (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Financial assets and liabilities, fair value disclosure | $ 171,160 | $ 115,818 | |
Assets | (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Financial assets and liabilities, fair value disclosure | 783 | 36,158 | |
Assets | Aggregate Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Financial assets and liabilities, fair value disclosure | 171,943 | 151,976 | |
Prepaid expenses and other assets | (Level 1) | Supplemental Employee Retirement Plans, Defined Benefit | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Money market fund Deferred comp and supplemental plan, fair value | [1] | 463 | 203 |
Mutual funds, deferred benefit plan | [1] | 15,443 | 22,778 |
Prepaid expenses and other assets | (Level 2) | Supplemental Employee Retirement Plans, Defined Benefit | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Money market fund Deferred comp and supplemental plan, fair value | [1] | 0 | 0 |
Mutual funds, deferred benefit plan | [1] | 0 | 0 |
Prepaid expenses and other assets | Aggregate Fair Value | Supplemental Employee Retirement Plans, Defined Benefit | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Money market fund Deferred comp and supplemental plan, fair value | [1] | 463 | 203 |
Mutual funds, deferred benefit plan | [1] | 15,443 | 22,778 |
Other current liabilities | (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Financial assets and liabilities, fair value disclosure | 171,160 | 115,818 | |
Other current liabilities | (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Financial assets and liabilities, fair value disclosure | (3,470) | 33,347 | |
Other current liabilities | Aggregate Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Financial assets and liabilities, fair value disclosure | 167,690 | 149,165 | |
Money market fund deposits | Cash equivalents | (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Cash and cash equivalents | 112,748 | 36,646 | |
Money market fund deposits | Cash equivalents | (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Cash and cash equivalents | 0 | 0 | |
Money market fund deposits | Cash equivalents | Aggregate Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Cash and cash equivalents | 112,748 | 36,646 | |
Certificates of deposit | Cash equivalents | (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Cash and cash equivalents | 42,506 | 56,191 | |
Certificates of deposit | Cash equivalents | Aggregate Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Cash and cash equivalents | 42,506 | 56,191 | |
U.S. Treasury and agency obligations | Short-term investments | (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Investments | [2] | 0 | 0 |
U.S. Treasury and agency obligations | Short-term investments | (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Investments | [2] | 0 | 35,346 |
U.S. Treasury and agency obligations | Short-term investments | Aggregate Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Investments | [2] | 0 | 35,346 |
Foreign exchange contracts | Prepaid expenses and other assets | (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative, fair value, net | [3] | 0 | 0 |
Foreign exchange contracts | Prepaid expenses and other assets | (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative, fair value, net | [3] | 783 | 812 |
Foreign exchange contracts | Prepaid expenses and other assets | Aggregate Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative, fair value, net | [3] | 783 | 812 |
Foreign exchange contracts | Other current liabilities | (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative, fair value, net | [3] | 0 | 0 |
Foreign exchange contracts | Other current liabilities | (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative, fair value, net | [3] | (4,253) | (2,811) |
Foreign exchange contracts | Other current liabilities | Aggregate Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Derivative, fair value, net | [3] | $ (4,253) | $ (2,811) |
[1] | The fair value of mutual funds is determined based on quoted market prices. Securities traded on a national exchange are stated at the last reported sales price on the day of valuation; other securities traded in over-the-counter markets and listed securities for which no sale was reported on that date are stated as the last quoted bid price. | ||
[2] | Valuations are based upon quoted market prices in active markets involving similar assets. The market inputs used to value these instruments generally consist of market yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Pricing sources include industry standard data providers, security master files from large financial institutions, and other third party sources which are input into a distribution-curve-based algorithm to determine a daily market value. This creates a "consensus price" or a weighted average price for each security. | ||
[3] | The principal market in which we execute our foreign currency contracts is the institutional market in an over-the-counter environment with a relatively high level of price transparency. The market participants usually are large commercial banks. Our foreign currency contracts' valuation inputs are based on quoted prices and quoted pricing intervals from public data sources and do not involve management judgment. See Note 7, "Derivative Instruments and Hedging Activities." |
Short-Term Investments (Details
Short-Term Investments (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 |
Debt Securities, Available-for-sale [Abstract] | |||
Cash and cash equivalents: cost basis | $ 456,534 | $ 440,258 | |
Cash Equivalent, Unrealized Gains | 0 | 0 | |
Cash Equivalent, Unrealized Losses | 0 | 0 | |
Cash and cash equivalents | 456,534 | 440,258 | $ 305,833 |
Available-for-sale securities, fair value | $ 0 | 35,346 | |
U.S. Treasury and agency obligations | |||
Debt Securities, Available-for-sale [Abstract] | |||
Available-for-sale securities: cost basis | 35,311 | ||
Available-for-sale securities: unrealized gains | 36 | ||
Available-for-sale securities: unrealized losses | (1) | ||
Available-for-sale securities, fair value | 35,346 | ||
U.S. Treasury and agency obligations | Short-term investments | |||
Debt Securities, Available-for-sale [Abstract] | |||
Available-for-sale securities: cost basis | 35,311 | ||
Available-for-sale securities: unrealized gains | 36 | ||
Available-for-sale securities: unrealized losses | (1) | ||
Debt securities, available-for-sale | $ 35,346 |
Short-Term Investments - Narrat
Short-Term Investments - Narrative (Details) - USD ($) | 12 Months Ended | |
Oct. 02, 2021 | Oct. 03, 2020 | |
Investments, Debt and Equity Securities [Abstract] | ||
Unrealized gain (loss) (less than for October 3, 2020) | $ 0 | $ 100,000 |
Proceeds from sale of available-for-sale securities | 0 | 5,000 |
Realized gain (loss) | $ 0 | $ 0 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
Forward contracts period of maturities | 2 months | ||
Realized gain (loss) on derivative | $ 5.1 | $ 1.1 | $ 5.8 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities - Notional and Fair Value (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 02, 2021 | Oct. 03, 2020 | |
Derivatives, Fair Value [Line Items] | ||
Forward contracts period of maturities | 2 months | |
Purchase | Derivatives not designated as hedging instruments | Euro | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, notional amount | $ 236,943 | $ 169,206 |
Derivative asset, fair value | (4,108) | (1,802) |
Sell | Derivatives not designated as hedging instruments | Euro | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, notional amount | (64,308) | (166,813) |
Derivative liability, fair value | $ 638 | $ (197) |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Apr. 04, 2020 | Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Impairment of goodwill | $ 0 | $ 327,203,000 | $ 0 | |
Goodwill | 105,261,000 | 101,317,000 | 427,101,000 | |
Asset impairment charges | $ 2,500,000 | |||
Goodwill and intangible asset impairment | 0 | 451,025,000 | 0 | |
Amortization of intangible assets | 10,700,000 | 30,100,000 | 61,500,000 | |
Existing technology | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Goodwill and intangible asset impairment | $ 27,700,000 | |||
Remaining amortization period | 3 years | |||
Customer relationships | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Goodwill and intangible asset impairment | $ 6,200,000 | |||
Remaining amortization period | 5 years 1 month 6 days | |||
Production know-how | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Remaining amortization period | 2 years | |||
Foreign Exchange | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | $ (700,000) | 2,900,000 | ||
Industrial Lasers & System | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Impairment of goodwill | 327,200,000 | 327,203,000 | ||
Goodwill | 0 | 0 | 0 | 330,281,000 |
Industrial Lasers & System | Finite-Lived Intangible Assets | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Asset impairment charges | 33,900,000 | |||
Industrial Lasers & System | Property and equipment | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Asset impairment charges | 85,600,000 | |||
Industrial Lasers & System | Right-Of-Use Assets | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Asset impairment charges | 1,800,000 | |||
OEM Laser Sources | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Impairment of goodwill | $ 0 | 0 | ||
Goodwill | $ 105,261,000 | $ 101,317,000 | $ 96,820,000 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of changes in carrying amount of goodwill by segment (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Apr. 04, 2020 | Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Goodwill [Line Items] | ||||
Goodwill, beginning of period | $ 101,317,000 | $ 427,101,000 | ||
Impairment charges | 0 | (327,203,000) | $ 0 | |
Additions | 4,586,000 | |||
Translation adjustments | (642,000) | 1,419,000 | ||
Goodwill, end of period | 105,261,000 | 101,317,000 | 427,101,000 | |
Industrial Lasers & System | ||||
Goodwill [Line Items] | ||||
Goodwill, beginning of period | 0 | 330,281,000 | ||
Impairment charges | $ (327,200,000) | (327,203,000) | ||
Additions | 0 | |||
Translation adjustments | 0 | (3,078,000) | ||
Goodwill, end of period | 0 | 0 | 0 | 330,281,000 |
OEM Laser Sources | ||||
Goodwill [Line Items] | ||||
Goodwill, beginning of period | 101,317,000 | 96,820,000 | ||
Impairment charges | $ 0 | 0 | ||
Additions | 4,586,000 | |||
Translation adjustments | (642,000) | 4,497,000 | ||
Goodwill, end of period | $ 105,261,000 | $ 101,317,000 | $ 96,820,000 |
Goodwill and Intangible Assets-
Goodwill and Intangible Assets- Schedule of components of amortizable intangible assets (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 64,225 | $ 73,235 |
Accumulated Amortization | (49,485) | (51,470) |
Net | 14,740 | 21,765 |
Existing technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 39,524 | 46,547 |
Accumulated Amortization | (35,522) | (37,630) |
Net | 4,002 | 8,917 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 22,101 | 24,388 |
Accumulated Amortization | (12,586) | (12,923) |
Net | 9,515 | 11,465 |
Production know-how | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,300 | 2,300 |
Accumulated Amortization | (1,377) | (917) |
Net | 923 | 1,383 |
In-process research and development | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 300 | 0 |
Accumulated Amortization | 0 | 0 |
Net | $ 300 | $ 0 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Schedule of estimated amortization expense (Details) $ in Thousands | Oct. 02, 2021USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2022 | $ 3,978 |
2023 | 3,407 |
2024 | 2,625 |
2025 | 2,306 |
2026 | 1,969 |
Thereafter | 155 |
Total (1) | $ 14,440 |
Balance Sheet Details - Schedul
Balance Sheet Details - Schedule of prepaid expenses and other assets (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Prepaid and refundable income taxes | $ 34,979 | $ 50,548 |
Other taxes receivable | 15,568 | 13,006 |
Prepaid expenses and other assets | 29,047 | 24,696 |
Prepaid expenses and other assets | $ 79,594 | $ 88,250 |
Balance Sheet Details - Sched_2
Balance Sheet Details - Schedule of other assets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 04, 2020 | Oct. 02, 2021 | Oct. 03, 2020 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets related to deferred compensation arrangements (see Note 12) | $ 38,946 | $ 41,501 | |
Right of use assets, net - operating leases (See Note 11) | 76,670 | 85,905 | |
Right of use assets, net - finance leases (See Note 11) | 26 | 656 | |
Other assets | 14,780 | 14,266 | |
Total other assets | $ 282,571 | $ 242,575 | |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Total other assets | Total other assets | |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Total other assets | Total other assets | |
Investment Owned, at Fair Value | $ 900 | ||
Asset impairment charges | $ 2,500 | ||
Other assets | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets related to deferred compensation arrangements (see Note 12) | $ 37,410 | $ 39,720 | |
Deferred tax assets (see Note 16) | $ 153,685 | $ 102,028 |
Balance Sheet Details - Sched_3
Balance Sheet Details - Schedule of other current liabilities (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Accrued payroll and benefits | $ 101,380 | $ 54,211 |
Operating lease liability, current (see Note 11) | 15,230 | 15,366 |
Finance lease liability, current (see Note 11) | 22 | 399 |
Accrued expenses and other | 41,156 | 36,432 |
Warranty reserve (see Note 2) | 31,057 | 35,032 |
Customer deposits | 19,364 | 9,717 |
Deferred revenue | 30,081 | 32,998 |
Other current liabilities | $ 238,290 | $ 184,155 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other current liabilities | Other current liabilities |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other current liabilities | Other current liabilities |
Balance Sheet Details - Sched_4
Balance Sheet Details - Schedule of other long-term liabilities (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Long-term taxes payable | $ 17,634 | $ 15,374 |
Operating lease liability, long-term (see Note 11) | 65,479 | 75,264 |
Finance lease liability, long-term (see Note 11) | 0 | 178 |
Deferred compensation (see Note 12) | 39,693 | 42,854 |
Deferred tax liabilities (see Note 16) | 19,356 | 15,721 |
Deferred revenue | 15,959 | 13,624 |
Asset retirement obligations liability (see Note 2) | 5,991 | 5,892 |
Defined benefit plan liabilities (see Note 17) | 44,110 | 45,810 |
Other long-term liabilities | 4,508 | 6,357 |
Other long-term liabilities | $ 212,730 | $ 221,074 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other long-term liabilities | Other long-term liabilities |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other long-term liabilities | Other long-term liabilities |
Borrowings - Additional Informa
Borrowings - Additional Information (Details) € in Millions, $ in Millions | Dec. 21, 2020EUR (€) | Dec. 29, 2018USD ($) | Oct. 02, 2021EUR (€) | Oct. 02, 2021USD ($) | Nov. 20, 2018USD ($) | Nov. 07, 2016EUR (€) | Nov. 07, 2016USD ($) |
Line of Credit Facility [Line Items] | |||||||
Revolving facility to finance acquisition of Rofin | $ 28.5 | ||||||
Revolving facility to finance acquisition of Rofin, outstanding balance | $ 10 | ||||||
Debt issuance cost related to repricing | $ 0.5 | ||||||
Additional sources of cash available | 15 | ||||||
Unused borrowing capacity | $ 13.1 | ||||||
Loan Agreement December 21 2020 | Foreign Line of Credit | Commerzbank | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | € | € 24 | ||||||
Debt Instrument, Term | 10 years | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 1.55% | ||||||
International credit facilities as guarantees | € | € 24 | ||||||
Rofin-Sinar | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | $ 30 | ||||||
Swing line, maximum borrowing capacity | $ 10 | ||||||
Base Rate Loans | Eurodollar | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 4.00% | ||||||
Base Rate Loans | Base Rate | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 3.00% | ||||||
Credit Agreement November 7 2016 | |||||||
Line of Credit Facility [Line Items] | |||||||
Senior secured net leverage ratio to maintain compliance on the loan each quarter end | 3.50 | 3.50 | |||||
Euro Term Loans | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt Instrument, Term | 7 years | ||||||
Euro term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt issuance costs | 28.5 | ||||||
Euro term loan | Eurodollar | Minimum | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt Instrument, Interest Rate, Stepdown | 1.25% | ||||||
Revolving line of credit | |||||||
Line of Credit Facility [Line Items] | |||||||
Revolving facility to finance acquisition of Rofin | $ 100 | ||||||
Additional base rate | 0.0050 | 0.0050 | |||||
Debt issuance costs | $ 2.3 | ||||||
Debt issuance cost amortization period | 5 years | ||||||
Revolving line of credit | Minimum | |||||||
Line of Credit Facility [Line Items] | |||||||
Base rate range after 1st year | 0.0225 | 0.0225 | |||||
Commitment fee accrues range on unused portion of revolving loan | 0.00375 | 0.00375 | |||||
Revolving line of credit | Maximum | |||||||
Line of Credit Facility [Line Items] | |||||||
Commitment fee accrues range on unused portion of revolving loan | 0.005 | 0.005 | |||||
Line of Credit, Foreign | |||||||
Line of Credit Facility [Line Items] | |||||||
International credit facilities as guarantees | $ 1.9 | ||||||
Euro | |||||||
Line of Credit Facility [Line Items] | |||||||
Letters of Credit Outstanding, Amount | € | € 10 | ||||||
Restricted Cash | 10.5 | $ 12.2 | |||||
Euro | Euro term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Forward contract purchased for the term loan | € | € 351.5 | € 670 | |||||
Additional Euro currency rate | 0.010 | 0.010 | |||||
Quarter principal payment requirement for Euro term loan | 0.0025 | 0.0025 |
Borrowings - Summary Short-term
Borrowings - Summary Short-term Borrowings (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | ||
Short-term Debt [Line Items] | |||
Total short-term borrowings and current portion of long-term obligations | $ 18,395 | $ 16,817 | |
Interest rate of state of Connecticut | 1.00% | 1.00% | |
Interest Rate For 1.3% Term Loan Due 2024 | 1.30% | 1.30% | |
Euro term loan | |||
Short-term Debt [Line Items] | |||
Debt issuance cost for short term portion of the Euro term loan | $ 2,800 | $ 2,900 | |
Short-term Debt | |||
Short-term Debt [Line Items] | |||
Current portion of Euro Term Loan | [1] | 4,972 | 4,970 |
1.3% Term loan due 2024 | 1,448 | 1,465 | |
1.0% State of Connecticut term loan due 2023 | 386 | 382 | |
Facility construction loan in Germany due 2030 | 1,589 | 0 | |
Line of credit borrowings | $ 10,000 | $ 10,000 | |
[1] | (1) Net of debt issuance costs of $2.8 million and $2.9 million at October 2, 2021 and October 3, 2020, respectively. |
Borrowings - Summary of Long-te
Borrowings - Summary of Long-term Borrowings (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | ||
Debt Instrument [Line Items] | |||
Total | $ 440,007 | ||
Interest Rate For 1.3% Term Loan Due 2024 | 1.30% | 1.30% | |
Interest rate of state of Connecticut | 1.00% | 1.00% | |
Euro term loan | |||
Debt Instrument [Line Items] | |||
Debt issuance cost for long term portion of the Euro term loan | $ 3,000 | $ 5,900 | |
Long-term debt | |||
Debt Instrument [Line Items] | |||
Euro Term Loan due 2024 | [1] | 396,429 | 406,099 |
1.3% Term loan due 2024 | 2,896 | 4,395 | |
1.0% State of Connecticut term loan due 2023 | 260 | 646 | |
Facility construction loan in Germany due 2030 | 26,215 | 0 | |
Total | $ 425,800 | $ 411,140 | |
[1] | ( 1) Net of debt issuance costs of $3.0 million and $5.9 million at October 2, 2021 and October 3, 2020, respectively. |
Borrowings - Schedule of contra
Borrowings - Schedule of contractual maturities of debt obligations (Details) $ in Thousands | Oct. 02, 2021USD ($) |
Debt Disclosure [Abstract] | |
2022 | $ 11,183 |
2023 | 12,649 |
2024 | 396,314 |
2025 | 3,178 |
2026 | 3,178 |
Thereafter | 13,505 |
Total | $ 440,007 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Apr. 04, 2020 | Oct. 03, 2020 | Oct. 02, 2021 | |
Lessee, Lease, Description [Line Items] | |||
Asset impairment charges | $ 2,500 | ||
Operating lease, right-of-use asset | $ 85,905 | $ 76,670 | |
Present value of total operating lease liabilities | $ 80,709 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Finance lease, term of contracts | 3 years | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Finance lease, term of contracts | 6 years | ||
Right-Of-Use Assets | Industrial Lasers & System | |||
Lessee, Lease, Description [Line Items] | |||
Asset impairment charges | $ 1,800 | ||
Building | |||
Lessee, Lease, Description [Line Items] | |||
Sale and leaseback transaction, gain (loss), net | 19,600 | ||
Operating lease, right-of-use asset | 5,100 | ||
Present value of total operating lease liabilities | 5,100 | ||
Other non-cash expense (gain) | 4,000 | ||
Building | Selling, General and Administrative Expenses | |||
Lessee, Lease, Description [Line Items] | |||
Sale and leaseback transaction, gain (loss), net | $ 2,200 | ||
Building | Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Sale leaseback transaction, lease terms | 6 | ||
Leases, early termination provisions | 3 years | ||
Building | Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Sale leaseback transaction, lease terms | 15 years | ||
Leases, early termination provisions | 5 years |
Leases - Components of Operatin
Leases - Components of Operating Lease Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 02, 2021 | Oct. 03, 2020 | |
Leases [Abstract] | ||
Operating lease cost | $ 22,601 | $ 19,629 |
Variable lease cost | 1,329 | 1,421 |
Short-term lease cost | 52 | 459 |
Sublease income | 9 | 126 |
Total lease cost | $ 23,973 | $ 21,383 |
Weighted average remaining lease term | 7 years 3 months 18 days | 7 years 9 months 18 days |
Weighted average discount rate | 5.00% | 4.90% |
Operating cash outflows from operating leases | $ 22,667 | $ 19,391 |
ROU assets obtained in exchange for new operating lease liabilities | $ 11,565 | $ 10,884 |
Leases - Lessee, Operating Leas
Leases - Lessee, Operating Lease, Liability, Maturity (Details) $ in Thousands | Oct. 02, 2021USD ($) |
Leases [Abstract] | |
2022 | $ 18,279 |
2023 | 16,546 |
2024 | 14,304 |
2025 | 11,718 |
2026 | 8,978 |
2027 and thereafter | 29,702 |
Total minimum lease payments | 99,527 |
Amounts representing interest | (18,818) |
Present value of total operating lease liabilities | $ 80,709 |
Employee Stock Award and Bene_3
Employee Stock Award and Benefit Plans - Schedule of deferred compensation plans' investments and liabilities (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Share-based Compensation, Allocation and Classification in Financial Statements [Line Items] | ||
Cash surrender value of life insurance contracts | $ 23,040 | $ 18,520 |
Fair value of mutual and money market funds | 15,906 | 22,981 |
Total assets | 38,946 | 41,501 |
Total deferred compensation liability, included in: | ||
Other current liabilities | 1,536 | 1,781 |
Other long-term liabilities | 39,693 | 42,854 |
Total deferred compensation liability | 41,229 | 44,635 |
Prepaid expenses and other assets | ||
Share-based Compensation, Allocation and Classification in Financial Statements [Line Items] | ||
Total assets | 1,536 | 1,781 |
Other assets | ||
Share-based Compensation, Allocation and Classification in Financial Statements [Line Items] | ||
Total assets | $ 37,410 | $ 39,720 |
Employee Stock Award and Bene_4
Employee Stock Award and Benefit Plans - Deferred Compensation Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Share-based Payment Arrangement [Abstract] | |||
Gain (loss) on deferred compensation plan investments | $ 9.8 | $ 6.1 | $ 1.1 |
Deferred compensation arrangement with individual, expense (benefit) | $ 8.9 | $ 5.3 | $ 1.5 |
Employee Stock Award and Bene_5
Employee Stock Award and Benefit Plans - Employee Retirement and Investment and Stock Purchase Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Share-based Payment Arrangement [Abstract] | |||
Postretirement benefit plan, maximum employer contribution rate | 4.00% | ||
Employer contributions to retirement and investment plans net of forfeitures | $ 6.2 | $ 6.1 | $ 5.7 |
Employee Stock Award and Bene_6
Employee Stock Award and Benefit Plans - Stock Option and Award Plans (Details) - USD ($) | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Initial RSU grants to new non-employee directors, fair value | $ 225,000 | ||
Stock vesting periods (in years) | 2 years | ||
Annual RSU grants to non-employee directors, fair value | $ 225,000 | ||
2011 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of common stock remain available for grant (in shares) | 270,371 | ||
Number shares purchased for award (in shares) | 3,080,000 | ||
2020 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of common stock remain available for grant (in shares) | 2,347,532 | ||
Employee Stock Purchase Plans | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum employee subscription rate | 10.00% | ||
Discount from market price, offering date | 85.00% | ||
Employee stock purchase plans (in shares) | 120,023 | 107,284 | 108,034 |
Weighted average price of shares purchased (in dollars per share) | $ 104 | $ 114.54 | $ 109.32 |
Capital shares reserved for future issuance (in shares) | 273,442 | ||
Time Based Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock vesting periods (in years) | 3 years | ||
Time Based Restricted Stock Units | Director | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock vesting periods (in years) | 2 years | ||
Performance Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock vesting periods (in years) | 3 years |
Employee Stock Award and Bene_7
Employee Stock Award and Benefit Plans - Fair Value of Stock Compensation (Details) - $ / shares | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | |||
Stock vesting periods (in years) | 2 years | ||
Employee Stock Purchase Plans | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | |||
Expected life in years | 6 months | 6 months | 6 months |
Expected volatility | 52.60% | 58.00% | 47.90% |
Risk-free interest rate | 0.10% | 1.00% | 2.40% |
Weighted average fair value per share (in USD per share) | $ 55.64 | $ 43.54 | $ 40.77 |
Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | |||
Expected volatility | 51.70% | 50.50% | 43.70% |
Risk-free interest rate | 0.20% | 0.80% | 2.90% |
PRSU weighted average fair value (in USD per share) | $ 119.54 | $ 161.46 | $ 117.43 |
Stock vesting periods (in years) | 3 years |
Employee Stock Award and Bene_8
Employee Stock Award and Benefit Plans - Schedule of stock-based compensation expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Allocated stock-based compensation expense | $ 36,018 | $ 39,147 | $ 31,520 |
Cost of sales | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Allocated stock-based compensation expense | 7,675 | 5,314 | 4,880 |
Research and development | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Allocated stock-based compensation expense | 4,463 | 4,478 | 2,990 |
Selling, general and administrative | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Allocated stock-based compensation expense | 29,267 | 34,995 | 28,596 |
Income tax benefit | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Allocated stock-based compensation expense | $ (5,387) | $ (5,640) | $ (4,946) |
Employee Stock Award and Bene_9
Employee Stock Award and Benefit Plans - Stock Compensation Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Share-based Payment Arrangement [Abstract] | |||
Share-based payment arrangement, amount capitalized | $ 7 | $ 6.7 | |
Employee service share-based compensation, allocation of Recognized period costs, amortized amount | 7.7 | 5.3 | |
Employee service share-based compensation, allocation of recognized period costs, remaining | 2.1 | 2.8 | |
Share-based payment arrangement, nonvested award, cost not yet recognized, amount | $ 47.6 | ||
Share-based payment arrangement, nonvested award, cost not yet recognized, period for recognition | 1 year 4 months 24 days | ||
Discrete tax benefit, provision income taxes related to share-based compensation | $ 0.7 | $ 0.9 | $ 2.5 |
Employee Stock Award and Ben_10
Employee Stock Award and Benefit Plans - Stock Awards Activity (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Share-based Payment Arrangement [Abstract] | |||
Number of outstanding options subject to vesting (shares) | 24,000 | ||
Number of options outstanding (shares) | 0 | 0 | |
Restricted stock shares withheld to cover payment of taxes (in shares) | 80,605 | 88,000 | 120,000 |
Restricted shares, value, shares withheld for payment of taxes | $ 10.4 | $ 13.5 | $ 15.2 |
Employee Stock Award and Ben_11
Employee Stock Award and Benefit Plans - Schedule of restricted stock award and restricted stock unit activity (Details) - $ / shares shares in Thousands | 12 Months Ended | |||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | ||
Time Based Restricted Stock Units | ||||
Number of Shares | ||||
Nonvested stock, number of shares, beginning of period (in shares) | 419 | 295 | 279 | |
Nonvested stock, granted (in shares) | 294 | 284 | 195 | |
Nonvested stock, vested (in shares) | [1] | (229) | (150) | (169) |
Nonvested stock, forfeited (in shares) | (13) | (10) | (10) | |
Nonvested stock, number of shares, end of period (in shares) | 471 | 419 | 295 | |
Weighted Average Grant Date Fair Value | ||||
Nonvested stock, weighted average grant date fair value, beginning balance (in dollars per share) | $ 144.87 | $ 152.47 | $ 155.24 | |
Nonvested stock, granted (in dollars per share) | 136.46 | 141.05 | 128.25 | |
Nonvested stock, vested (in dollars per share) | [1] | 144.32 | 150.91 | 127.90 |
Nonvested stock, foreited (in dollars per share) | 134.64 | 169.92 | 170.97 | |
Nonvested stock, weighted average grant date fair value, ending balance (in dollars per share) | $ 140.16 | $ 144.87 | $ 152.47 | |
Performance Restricted Stock Units | ||||
Number of Shares | ||||
Nonvested stock, number of shares, beginning of period (in shares) | 136 | 133 | 159 | |
Nonvested stock, granted (in shares) | 64 | 84 | 105 | |
Nonvested stock, vested (in shares) | [1] | (12) | (81) | (131) |
Nonvested stock, forfeited (in shares) | (30) | 0 | 0 | |
Nonvested stock, number of shares, end of period (in shares) | 158 | 136 | 133 | |
Weighted Average Grant Date Fair Value | ||||
Nonvested stock, weighted average grant date fair value, beginning balance (in dollars per share) | $ 177.54 | $ 184.26 | $ 155.76 | |
Nonvested stock, granted (in dollars per share) | 119.43 | 152.96 | 117.43 | |
Nonvested stock, vested (in dollars per share) | [1] | 118.45 | 163.17 | 74.48 |
Nonvested stock, foreited (in dollars per share) | 315.05 | 0 | 0 | |
Nonvested stock, weighted average grant date fair value, ending balance (in dollars per share) | $ 131.90 | $ 177.54 | $ 184.26 | |
Targeted goal percentage | 100.00% | |||
Performance Restricted Stock Units | Minimum | ||||
Weighted Average Grant Date Fair Value | ||||
Award earned percentage | 0.00% | |||
Performance Restricted Stock Units | Maximum | ||||
Weighted Average Grant Date Fair Value | ||||
Award earned percentage | 200.00% | |||
[1] | Service-based restricted stock units vested during each fiscal year. Performance-based restricted stock units are included at 100% of target goal. Under the terms of the market-based awards, the recipient may earn between 0% and 200% of the award. Under the terms of the fiscal 2020 performance-based awards based on free cash flow targets, the recipient may earn between 0% and 100% of the award. |
Commitments and Contingencies -
Commitments and Contingencies - Purchase Commitments (Details) $ in Millions | Oct. 02, 2021USD ($) |
Inventories | |
Long-term Purchase Commitment [Line Items] | |
Purchase commitments and obligations | $ 63.8 |
Fixed assets and services | |
Long-term Purchase Commitment [Line Items] | |
Purchase commitments and obligations | $ 50.6 |
Commitments and Contingencies O
Commitments and Contingencies Other Contingencies (Details) - 12 months ended Oct. 02, 2021 € in Millions, $ in Millions | EUR (€) | USD ($) |
Commitments and Contingencies Disclosure [Abstract] | ||
German government export compliance matter impacted transactions | € | € 1.5 | |
Discretionary Payment to Financial Advisors | $ | $ 3 |
Stock Repurchases (Details)
Stock Repurchases (Details) - USD ($) | 12 Months Ended | |||
Oct. 02, 2021 | Oct. 03, 2020 | Feb. 05, 2020 | Oct. 28, 2018 | |
Oct 2018 repurchase program | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Authorized repurchase of common stock | $ 250,000,000 | |||
Repurchase limit per quarter | $ 75,000,000 | |||
Number of shares of outstanding common stock repurchased and retired (shares) | 603,828 | |||
Stock repurchase, price paid per share (dollars per share) | $ 128.20 | |||
Total cost of stock repurchased, net | $ 77,400,000 | |||
Feb 2020 repurchase program | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Authorized repurchase of common stock | $ 100,000,000 | |||
Stock repurchased , value | $ 0 | $ 0 |
Other Income (Expense), Net (De
Other Income (Expense), Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Component of Other Income (Expense), Nonoperating [Line Items] | |||
Other income (expense) | $ 276 | $ 3,441 | $ (5,044) |
Foreign exchange loss | |||
Component of Other Income (Expense), Nonoperating [Line Items] | |||
Other income (expense) | (4,972) | (3,486) | (5,774) |
Gain on deferred compensation investments, net (Note 12) | |||
Component of Other Income (Expense), Nonoperating [Line Items] | |||
Other income (expense) | 9,774 | 6,099 | 1,140 |
Translation adjustment related to the dissolution of certain entities | |||
Component of Other Income (Expense), Nonoperating [Line Items] | |||
Other income (expense) | (5,291) | 0 | 0 |
Other | |||
Component of Other Income (Expense), Nonoperating [Line Items] | |||
Other income (expense) | $ 765 | $ 828 | $ (410) |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Currently payable: | |||
Federal | $ 4,929 | $ (1,660) | $ 1,995 |
State | 390 | 471 | 557 |
Foreign | 33,713 | 1,176 | 13,448 |
Current income tax expense (benefit) | 39,032 | (13) | 16,000 |
Deferred and other: | |||
Federal | (47,908) | (2,343) | (407) |
State | (4,872) | (1,605) | 516 |
Foreign | 4,961 | (24,623) | (9,886) |
Deferred income tax expense (benefit) | (47,819) | (28,571) | (9,777) |
Provision for (benefit from) income taxes | $ (8,787) | $ (28,584) | $ 6,223 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income before Income Tax, Domestic and Foreign (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (207,827) | $ (98,900) | $ 54,480 |
Foreign | 92,289 | (343,823) | 5,568 |
Income (loss) before income taxes | $ (115,538) | $ (442,723) | $ 60,048 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Income Tax Disclosure [Abstract] | |||
Effective income tax rate reconciliation, at federal statutory income tax rate, percent | 21.00% | ||
Federal statutory tax expense (benefit) | $ (24,263) | $ (92,972) | $ 12,610 |
Valuation allowance | 14,925 | 15,231 | 7,925 |
Taxes on foreign earnings at rates greater (less) than U.S. rates, net | 8,326 | (27,041) | (8,210) |
Stock-based compensation | 4,351 | 3,640 | 556 |
State income taxes, net of federal income tax benefit | (4,215) | (1,249) | 1,131 |
Research and development credit | (4,279) | (4,350) | (3,665) |
Deferred compensation | (1,050) | (564) | (206) |
Release of unrecognized tax benefits | (1,957) | (20,027) | (6,688) |
Release of interest accrued for unrecognized tax benefits | (328) | (4,232) | (205) |
Reversal of competent authority | 0 | 8,552 | 0 |
Deferred taxes on foreign earnings | 2,302 | 1,303 | 1,215 |
Write-off of withholding tax credits | 0 | 0 | 1,134 |
Goodwill impairment | 0 | 89,962 | 0 |
FDII deduction | 2,791 | 0 | (536) |
Other, net | 192 | 3,163 | 90 |
Provision for (benefit from) income taxes | $ (8,787) | $ (28,584) | $ 6,223 |
Effective tax rate | 7.60% | 6.50% | 10.40% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | Mar. 25, 2021 | Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 |
Income Tax Examination [Line Items] | ||||
Effective tax rate on income before income taxes | 7.60% | 6.50% | ||
Effective income tax rate reconciliation, at federal statutory income tax rate, percent | 21.00% | |||
Income taxes payable/receivable | $ 32,565,000 | $ (25,024,000) | $ (119,929,000) | |
Valuation allowance, deferred tax asset, increase (decrease), amount | (15,500,000) | |||
Valuation allowance | (73,166,000) | (57,707,000) | ||
Operating loss carryforwards and tax credits | 73,902,000 | 83,447,000 | ||
Unrecognized tax benefits, including interest and penalties | 43,400,000 | |||
Unrecognized tax benefits that would impact effective tax rate | 32,400,000 | |||
Unrecognized tax benefits, income tax penalties and interest accrued | 3,600,000 | 2,900,000 | ||
Payments for Merger Related Costs | 217,600,000 | |||
Lumentum Holdings Inc. | ||||
Income Tax Examination [Line Items] | ||||
Payments for Merger Related Costs | $ 217,600,000 | |||
Tax benefit credit to APIC when recognized | ||||
Income Tax Examination [Line Items] | ||||
Deferred tax assets, tax credit carryforwards, foreign | 38,400,000 | |||
SINGAPORE | ||||
Income Tax Examination [Line Items] | ||||
Income taxes payable/receivable | 3,700,000 | $ 2,600,000 | $ 3,900,000 | |
Foreign Tax Authority | ||||
Income Tax Examination [Line Items] | ||||
Operating loss carryforwards and tax credits | 132,900,000 | |||
Deferred tax assets, operating loss carryforwards, not subject to expiration | 98,800,000 | |||
Deferred tax assets, operating loss carryforwards, subject to expiration | 34,100,000 | |||
Operating loss carryforwards, valuation allowance | 128,000,000 | |||
Federal Government | ||||
Income Tax Examination [Line Items] | ||||
Operating loss carryforwards and tax credits | 10,100,000 | |||
State Government | ||||
Income Tax Examination [Line Items] | ||||
Operating loss carryforwards and tax credits | 30,400,000 | |||
Internal Revenue Service (IRS) | Subject to Expiration Dates | ||||
Income Tax Examination [Line Items] | ||||
Deferred tax assets, tax credit carryforwards, research | 38,400,000 | |||
CALIFORNIA | ||||
Income Tax Examination [Line Items] | ||||
Tax credit carryforward, valuation allowance | 29,400,000 | |||
CALIFORNIA | Not Subject to Expiration Dates | ||||
Income Tax Examination [Line Items] | ||||
Deferred tax assets, tax credit carryforwards, research | 34,900,000 | |||
Other states besides California | ||||
Income Tax Examination [Line Items] | ||||
Tax credit carryforward, valuation allowance | 3,800,000 | |||
Other states besides California | Subject to Expiration Dates | ||||
Income Tax Examination [Line Items] | ||||
Deferred tax assets, tax credit carryforwards, research | $ 4,300,000 | |||
SINGAPORE | ||||
Income Tax Examination [Line Items] | ||||
The benefits of the tax holiday on net income per diluted share | $ 0.15 | $ 0.11 | $ 0.16 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Income Tax Disclosure [Abstract] | ||
Reserves and accruals not currently deductible | $ 49,027 | $ 28,520 |
Operating loss carryforwards and tax credits | 73,902 | 83,447 |
Deferred revenue | 5,785 | 4,412 |
Depreciation and amortization | 12,311 | 14,362 |
Inventory capitalization | 3,509 | 0 |
Stock-based compensation | 3,452 | 4,906 |
Competent authority offset to transfer pricing tax reserves | 3,972 | 4,283 |
Accumulated translation adjustment | 3,970 | 2,508 |
Retirement and pension | 16,303 | 17,982 |
Lease liabilities | 20,080 | 21,737 |
Acquisition costs | 52,629 | 0 |
Other | 0 | 165 |
Total gross deferred tax assets | 244,940 | 182,322 |
Valuation allowance | (73,166) | (57,707) |
Total net deferred tax assets | 171,774 | 124,615 |
Deferred taxes on foreign earnings | 18,381 | 16,055 |
Inventory capitalization | 0 | 1,394 |
Right of use assets | 19,040 | 20,859 |
Other | 24 | 0 |
Total gross deferred tax liabilities | 37,445 | 38,308 |
Net deferred tax assets | $ 134,329 | $ 86,307 |
Income Taxes - Schedule of De_2
Income Taxes - Schedule of Deferred Tax Assets (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 |
Income Tax Examination [Line Items] | ||
Non-current deferred income tax liabilities | $ (19,356) | $ (15,721) |
Net deferred tax assets | 134,329 | 86,307 |
Other Noncurrent Assets | ||
Income Tax Examination [Line Items] | ||
Deferred tax assets (see Note 16) | 153,685 | 102,028 |
Other long-term liabilities | ||
Income Tax Examination [Line Items] | ||
Non-current deferred income tax liabilities | $ (19,356) | $ (15,721) |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits Roll Forward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Interest and Penalties [Roll Forward] | |||
Balance as of the beginning of the year | $ 39,507 | $ 58,111 | $ 65,882 |
Additions to tax positions related to current year | 1,017 | 1,410 | 605 |
Additions to tax positions related to prior year | 1,440 | 86 | 448 |
Reductions to tax positions related to prior year | (6) | (17) | (6,071) |
Lapses in statutes of limitations | (2,017) | (1,211) | (639) |
Decrease in unrecognized tax benefits based on settlement | 0 | (19,463) | 0 |
Foreign currency revaluation adjustment | (54) | (2,114) | |
Foreign currency revaluation adjustment | 591 | ||
Balance as of end of year | $ 39,887 | $ 39,507 | $ 58,111 |
Defined Benefit Plans - Additio
Defined Benefit Plans - Additional Information (Details) $ in Millions | 12 Months Ended |
Oct. 02, 2021USD ($) | |
Retirement Benefits [Abstract] | |
Defined benefit plan, single lump sum payment | $ 1 |
Defined Benefit Plans - Schedul
Defined Benefit Plans - Schedule of Net Benefit Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Retirement Benefits [Abstract] | |||
Service cost | $ 2,003 | $ 2,153 | $ 1,955 |
Interest cost | 936 | 857 | 1,308 |
Expected return on plan assets | (620) | (682) | (817) |
Recognized net actuarial (gain) loss | (292) | (690) | 470 |
Foreign exchange impacts | (82) | 66 | (79) |
Net periodic pension cost | $ 1,945 | $ 1,704 | $ 2,837 |
Defined Benefit Plans - Sched_2
Defined Benefit Plans - Schedule of Changes in Projected Benefit Obligations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Change in benefit obligation: | |||
Projected benefit obligation at beginning of year | $ 60,607 | $ 60,437 | |
Service cost | 2,003 | 2,153 | $ 1,955 |
Interest cost | 936 | 857 | 1,308 |
Assumption change | (443) | (1,783) | |
Experience loss | 261 | 22 | |
Foreign exchange rate impacts | (704) | 2,433 | |
Benefits paid – total | (2,327) | (3,010) | |
Settlement gain | 0 | 502 | |
Projected benefit obligation at end of year | 60,333 | 60,607 | 60,437 |
Projected benefit obligation at end of year | 60,333 | 60,607 | 60,437 |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 12,901 | 12,997 | |
Actual return on plan assets | 1,032 | 1,218 | |
Employer contributions | 87 | 208 | |
Benefits paid – funded plan | (607) | (1,522) | |
Fair value of plan assets at end of year | 13,413 | 12,901 | 12,997 |
Fair value of plan assets at end of year | 13,413 | 12,901 | $ 12,997 |
Unfunded status at end of year | (46,920) | (47,706) | |
Amounts recognized in the consolidated balance sheet: | |||
Accrued benefit liability – current | (2,810) | (1,896) | |
Accrued benefit liability – non current | (44,110) | (45,810) | |
Accumulated other comprehensive loss (pre-tax) | 190 | 456 | |
United States | |||
Change in benefit obligation: | |||
Projected benefit obligation at beginning of year | 18,775 | ||
Projected benefit obligation at end of year | 18,070 | 18,775 | |
Projected benefit obligation at end of year | 18,070 | 18,775 | |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 12,645 | ||
Fair value of plan assets at end of year | 13,131 | 12,645 | |
Fair value of plan assets at end of year | 13,131 | 12,645 | |
Foreign plans | |||
Change in benefit obligation: | |||
Projected benefit obligation at beginning of year | 41,832 | ||
Projected benefit obligation at end of year | 42,263 | 41,832 | |
Projected benefit obligation at end of year | 42,263 | 41,832 | |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 256 | ||
Fair value of plan assets at end of year | 282 | 256 | |
Fair value of plan assets at end of year | $ 282 | $ 256 |
Defined Benefit Plans - Sched_3
Defined Benefit Plans - Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 |
Retirement Benefits [Abstract] | |||
Projected benefit obligation | $ 60,333 | $ 60,607 | $ 60,437 |
Accumulated benefit obligation | 56,656 | 56,847 | |
Fair value of plan assets | $ 13,413 | $ 12,901 | $ 12,997 |
Defined Benefit Plans - Weighte
Defined Benefit Plans - Weighted average rates to determine the net periodic benefit costs (Details) | Oct. 02, 2021 | Oct. 03, 2020 |
United States | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate: | 2.60% | 2.30% |
Expected return on plan assets: | 5.00% | 5.00% |
Rate of compensation increase | 0.00% | 0.00% |
Foreign plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate: | 1.20% | 1.20% |
Rate of compensation increase | 2.20% | 2.20% |
Defined Benefit Plans - Sched_4
Defined Benefit Plans - Schedule of Expected Benefit Payments (Details) $ in Thousands | Oct. 02, 2021USD ($) |
Retirement Benefits [Abstract] | |
2022 | $ 3,539 |
2023 | 2,370 |
2024 | 2,867 |
2025 | 2,925 |
2026 | 3,291 |
2027-2031 | 16,142 |
Total | $ 31,134 |
Defined Benefit Plans - Sched_5
Defined Benefit Plans - Schedule of Allocation of Plan Assets (Details) | Oct. 02, 2021 | Oct. 03, 2020 |
Defined Benefit Plan Disclosure [Line Items] | ||
Defined benefit plan, plan assets, target allocation, percentage | 100.00% | |
Defined benefit plan, plan assets, actual allocation, percentage | 100.00% | 100.00% |
Equity securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined benefit plan, plan assets, target allocation, percentage | 60.00% | |
Defined benefit plan, plan assets, actual allocation, percentage | 59.00% | 32.00% |
Debt securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined benefit plan, plan assets, target allocation, percentage | 40.00% | |
Defined benefit plan, plan assets, actual allocation, percentage | 41.00% | 68.00% |
Defined Benefit Plans - Fair va
Defined Benefit Plans - Fair value of pension plan assets (Details) - USD ($) $ in Thousands | Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 |
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 13,413 | $ 12,901 | $ 12,997 |
Small cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 50 | |
Mid cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 143 | |
Large cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 293 | |
Total market stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 3,390 | 2,140 | |
International | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 1,751 | 1,166 | |
Emerging markets | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 197 | |
Bonds and mortgages | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 5,481 | 3,323 | |
Inflation protected | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
High yield | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 272 | |
Liability driven investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 60 | 4,848 | |
Money market | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2,731 | 469 | |
Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2,731 | 469 | |
Level 1 | Small cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | Mid cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | Large cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | Total market stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | International | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | Emerging markets | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | Bonds and mortgages | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | Inflation protected | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | High yield | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | Liability driven investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 1 | Money market | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2,731 | 469 | |
Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 10,682 | 12,432 | |
Level 2 | Small cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 50 | |
Level 2 | Mid cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 143 | |
Level 2 | Large cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 293 | |
Level 2 | Total market stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 3,390 | 2,140 | |
Level 2 | International | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 1,751 | 1,166 | |
Level 2 | Emerging markets | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 197 | |
Level 2 | Bonds and mortgages | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 5,481 | 3,323 | |
Level 2 | Inflation protected | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 2 | High yield | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 272 | |
Level 2 | Liability driven investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 60 | 4,848 | |
Level 2 | Money market | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Level 3 | Small cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 3 | Mid cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 3 | Large cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 3 | Total market stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 3 | International | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 3 | Emerging markets | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 3 | Bonds and mortgages | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 3 | Inflation protected | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 3 | High yield | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | 0 | |
Level 3 | Liability driven investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment within Plan Asset Category, Amount | 0 | ||
Level 3 | Money market | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 |
Segment and Geographic Inform_3
Segment and Geographic Information (Details) | 3 Months Ended | 12 Months Ended | ||
Apr. 04, 2020USD ($) | Oct. 02, 2021USD ($)segment | Oct. 03, 2020USD ($) | Sep. 28, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of reporting segments | segment | 2 | |||
Net sales | $ 1,487,468,000 | $ 1,228,999,000 | $ 1,430,640,000 | |
Income (loss) from operations: | (98,213,000) | (430,180,000) | 83,095,000 | |
Total other expense, net | (17,325,000) | (12,543,000) | (23,047,000) | |
Income (loss) before income taxes | (115,538,000) | (442,723,000) | 60,048,000 | |
Impairment of goodwill | 0 | 327,203,000 | 0 | |
Asset impairment charges | $ 2,500,000 | |||
Merger and acquisition costs | 236,047,000 | $ 0 | $ 0 | |
Termination fee | $ 217,600,000 | |||
Sales | Customer concentration risk | Customer one | ||||
Segment Reporting Information [Line Items] | ||||
Concentration risk, percentage | 15.90% | 17.20% | 16.80% | |
OEM Laser Sources | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | $ 913,636,000 | $ 758,929,000 | $ 886,676,000 | |
Impairment of goodwill | 0 | 0 | ||
Industrial Lasers & System | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 573,832,000 | 470,070,000 | 543,964,000 | |
Impairment of goodwill | 327,200,000 | 327,203,000 | ||
Industrial Lasers & System | Finite-Lived Intangible Assets | ||||
Segment Reporting Information [Line Items] | ||||
Asset impairment charges | 33,900,000 | |||
Industrial Lasers & System | Property and equipment | ||||
Segment Reporting Information [Line Items] | ||||
Asset impairment charges | 85,600,000 | |||
Industrial Lasers & System | Right-Of-Use Assets | ||||
Segment Reporting Information [Line Items] | ||||
Asset impairment charges | $ 1,800,000 | |||
Operating Segments | OEM Laser Sources | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 913,636,000 | 758,929,000 | 886,676,000 | |
Income (loss) from operations: | 214,003,000 | 169,883,000 | 239,073,000 | |
Operating Segments | Industrial Lasers & System | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 573,832,000 | 470,070,000 | 543,964,000 | |
Income (loss) from operations: | 13,257,000 | (518,186,000) | (93,133,000) | |
Corporate | ||||
Segment Reporting Information [Line Items] | ||||
Income (loss) from operations: | $ (325,473,000) | $ (81,877,000) | $ (62,845,000) |
Segment and Geographic Inform_4
Segment and Geographic Information - Revenue and Long-Lived Assets by Geographical Areas (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | $ 1,487,468 | $ 1,228,999 | $ 1,430,640 |
Total long-lived assets | 430,640 | 385,366 | |
United States | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 336,310 | 296,102 | 339,585 |
Total long-lived assets | 185,953 | 170,412 | |
Foreign Countries | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 1,151,158 | 932,897 | 1,091,055 |
Total long-lived assets | 244,687 | 214,954 | |
South Korea | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 274,298 | 247,461 | 313,461 |
China | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 274,026 | 196,824 | 194,653 |
Japan | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 119,202 | 94,068 | 138,028 |
Asia-Pacific, other | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 136,942 | 94,835 | 93,389 |
Total long-lived assets | 52,346 | 56,125 | |
Germany | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 139,240 | 117,170 | 145,285 |
Total long-lived assets | 157,199 | 123,019 | |
Europe, other | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 138,144 | 125,739 | 148,680 |
Total long-lived assets | 35,142 | 35,810 | |
Rest of World | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | $ 69,306 | $ 56,800 | $ 57,559 |
Restructuring Charges- Addition
Restructuring Charges- Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Oct. 03, 2020 | Oct. 02, 2021 | Oct. 03, 2020 | Sep. 28, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring cost relating to HPFL products at Germany facility | $ 1,100 | |||
Santa Clara facility combine project related restructuring charge | $ 100 | 1,500 | ||
Restructuring, incurred cost | 100 | |||
Severance costs | $ 2,600 | 12,200 | ||
Restructuring reserve, current | 2,841 | 1,408 | 2,841 | $ 8,494 |
Industrial Lasers & System | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring, incurred cost | 12,200 | 3,900 | ||
OEM Laser Sources | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring, incurred cost | 100 | 1,400 | ||
Severance Related | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring reserve, current | $ 2,611 | 1,127 | $ 2,611 | $ 8,279 |
Other current liabilities | Severance Related | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring reserve, current | $ 1,400 |
Restructuring Charges - Restruc
Restructuring Charges - Restructuring and Related Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 02, 2021 | Oct. 03, 2020 | |
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | $ 2,841 | $ 8,494 |
Provision | 12,282 | 5,291 |
Payments and other | (13,715) | (10,944) |
Restructuring reserve, ending balance | 1,408 | 2,841 |
Severance Related | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | 2,611 | 8,279 |
Provision | 3,795 | 2,468 |
Payments and other | (5,279) | (8,136) |
Restructuring reserve, ending balance | 1,127 | 2,611 |
Asset Write-Offs | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | 0 | 0 |
Provision | 5,637 | 2,194 |
Payments and other | (5,637) | (2,194) |
Restructuring reserve, ending balance | 0 | 0 |
Other | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring reserve, beginning balance | 230 | 215 |
Provision | 2,850 | 629 |
Payments and other | (2,799) | (614) |
Restructuring reserve, ending balance | $ 281 | $ 230 |