Segment Reporting

6 Months Ended

Jul. 03, 2021

Segment Reporting [Abstract]

Segment Reporting

11. Segment Reporting

Intevac’s two reportable segments are TFE and Photonics. Intevac’s chief operating decision-maker has been identified as the President and CEO, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Segment information is presented based upon Intevac’s management organization structure as of July 3, 2021 and the distinctive nature of each segment. Future changes to this internal financial structure may result in changes to the reportable segments disclosed.

Each reportable segment is separately managed and has separate financial results that are reviewed by Intevac’s chief operating decision-maker. Each reportable segment contains closely related products that are unique to the particular segment. Segment operating profit is determined based upon internal performance measures used by the chief operating decision-maker.

Intevac derives the segment results from its internal management reporting system. The accounting policies Intevac uses to derive reportable segment results are substantially the same as those used for external reporting purposes. Management measures the performance of each reportable segment based upon several metrics, including orders, net revenues and operating income. Management uses these results to evaluate the performance of, and to assign resources to, each of the reportable segments. Intevac manages certain operating expenses separately at the corporate level. Intevac allocates certain of these corporate expenses to the segments in an amount equal to 3% of net revenues. Segment operating income excludes interest income/expense and other financial charges and income taxes according to how a particular reportable segment’s management is measured. Management does not consider impairment charges, gains and losses on divestitures and sales of intellectual property, or unallocated costs in measuring the performance of the reportable segments.

The TFE segment designs, develops and markets vacuum process equipment solutions for high-volume manufacturing of small substrates with precise thin-film properties, such as for the hard drive, solar cell, DCP and advanced semiconductor packaging industries, as well as other adjacent thin-film markets.

The Photonics segment develops compact, cost-effective, high-sensitivity digital-optical products for the capture and display of low-light images. Intevac provides sensors, cameras and systems for government applications such as night vision.

Information for each reportable segment for the three and six months ended July 3, 2021 and June 27, 2020 is as follows:

Net Revenues

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
	(In thousands)
TFE	$	5,369	$	16,595	$	14,607	$	24,557
Photonics		8,444		12,247		15,447		23,125
Total segment net revenues	$	13,813	$	28,842	$	30,054	$	47,682

Operating Income (Loss)

	Three Months Ended						Six Months Ended
	July 3, 2021			June 27, 2020			July 3, 2021			June 27, 2020
	(In thousands)
TFE	$	(4,305	)	$	(174	)	$	(8,306	)	$	(2,705	)
Photonics		(255	)		3,536			(1,401	)		6,448
Total income (loss) from segment operations		(4,560	)		3,362			(9,707	)		3,743
Unallocated costs		(1,751	)		(1,258	)		(3,105	)		(2,738	)
Income (loss) from operations		(6,311	)		2,104			(12,812	)		1,005
Interest income and other income (expense), net		20			62			50			204
Income (loss) before provision for (benefit from) income taxes	$	(6,291	)	$	2,166		$	(12,762	)	$	1,209

Total assets for each reportable segment as of July 3, 2021 and January 2, 2021 are as follows:

Assets

	July 3, 2021		January 2, 2021
	(In thousands)
TFE	$	31,734	$	44,335
Photonics		17,837		22,923
Total segment assets		49,571		67,258
Cash, cash equivalents and investments		53,340		49,568
Restricted cash		787		787
Deferred income taxes		5,537		5,335
Other current assets		1,083		1,093
Common property, plant and equipment		1,206		1,443
Common operating lease right-of-use assets		1,381		1,603
Other assets		164		151
Consolidated total assets	$	113,069	$	127,238