Segment Information

9 Months Ended

Sep. 30, 2012

Segment Information

Segment Information

Note 5—Segment Information

We have four identified reporting units that we aggregate into two reportable segments: the VIBE and Mechanical reporting units which are reported in our Data Storage segment; and the MOCVD and MBE reporting units are reported in our LED and Solar segment.  We manage the business, review operating results and assess performance, as well as allocate resources, based upon our reporting units that reflect the market focus of each business. The LED & Solar segment consists of metal organic chemical vapor deposition (“MOCVD”) systems, molecular beam epitaxy (“MBE”) systems, thermal deposition sources and other types of deposition systems. These systems are primarily sold to customers in the LED and solar industries, as well as to scientific research customers. This segment has product development and marketing sites in Somerset, New Jersey, Poughkeepsie, New York, and St. Paul, Minnesota. During 2011 we discontinued our CIGS solar systems business, located in Tewksbury, Massachusetts and Clifton Park, New York. The Data Storage segment consists of the ion beam etch, ion beam deposition, diamond-like carbon, physical vapor deposition, and dicing and slicing products sold primarily to customers in the data storage industry. This segment has product development and marketing sites in Plainview, New York, Ft. Collins, Colorado and Camarillo, California.

We evaluate the performance of our reportable segments based on income (loss) from continuing operations before interest, income taxes, amortization and certain items (in the aggregate “segment profit (loss)”), which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management believes segment profit (loss) reports baseline performance and thus provides useful information. Certain items include restructuring charges, equity-based compensation expense and loss on extinguishment of debt. The accounting policies of the reportable segments are the same as those described in the summary of critical accounting policies.

The following tables present certain data pertaining to our reportable product segments and a reconciliation of segment profit (loss) to income (loss) from continuing operations before income taxes for the three and nine months ended September 30, 2012 and 2011, respectively, and goodwill and total assets as of September 30, 2012 and December 31, 2011 (in thousands):

	LED &  Solar			Data Storage			Unallocated Corporate			Total
Three months ended September 30, 2012
Net sales	$	98,905		$	33,810		$	—		$	132,715
Segment profit	$	9,461		$	4,278		$	480		$	14,219
Interest, net	—			—			176			176
Amortization	(1,154		)	(323		)	—			(1,477		)
Equity-based compensation	(1,914		)	(763		)	(588		)	(3,265		)
Restructuring	(660		)	(1,296		)	(58		)	(2,014		)
Income (loss) from continuing operations before income taxes	$	5,733		$	1,896		$	10		$	7,639
Three months ended September 30, 2011
Net sales	$	233,864		$	34,095		$	—		$	267,959
Segment profit (loss)	$	72,819		$	7,877		$	(2,581	)	$	78,115
Interest, net	—			—			244			244
Amortization	(924		)	(353		)	—			(1,277		)
Equity-based compensation	(996		)	(339		)	(1,620		)	(2,955		)
Income (loss) from continuing operations before income taxes	$	70,899		$	7,185		$	(3,957	)	$	74,127

	LED &			Data			Unallocated
	Solar			Storage			Corporate			Total
Nine months ended September 30, 2012
Net sales	$	281,257		$	127,914		$	—		$	409,171
Segment profit (loss)	$	36,534		$	25,367		$	(2,009	)	$	59,892
Interest, net	—			—			708			708
Amortization	(2,878		)	(999		)	—			(3,877		)
Equity-based compensation	(4,016		)	(1,614		)	(4,779		)	(10,409		)
Restructuring	(718		)	(1,301		)	(58		)	(2,077		)
Income (loss) from continuing operations before income taxes	$	28,922		$	21,453		$	(6,138	)	$	44,237
Nine months ended September 30, 2011
Net sales	$	667,697		$	119,753		$	—		$	787,450
Segment profit (loss)	$	232,848		$	33,158		$	(8,953	)	$	257,053
Interest, net	—			—			(1,142		)	(1,142		)
Amortization	(2,364		)	(1,072		)	(83		)	(3,519		)
Equity-based compensation	(2,567		)	(999		)	(5,906		)	(9,472		)
Loss on extinguishment of debt	—			—			(3,349		)	(3,349		)
Income (loss) from continuing operations before income taxes	$	227,917		$	31,087		$	(19,433	)	$	239,571

	LED &		Data		Unallocated
	Solar		Storage		Corporate		Total
As of September 30, 2012
Goodwill	$	55,828	$	—	$	—	$	55,828
Total assets	$	280,220	$	50,397	$	623,938	$	954,555
As of December 31, 2011
Goodwill	$	55,828	$	—	$	—	$	55,828
Total assets	$	319,457	$	57,203	$	559,403	$	936,063

As of September 30, 2012 and December 31, 2011 corporate total assets were comprised principally of cash and cash equivalents and short-term investments.