Segment Information and Foreign Operations

9 Months Ended

Sep. 30, 2016

Segment Information and Foreign Operations

Segment Information and Foreign Operations

Note 11. Segment Information and Foreign Operations

Segment Information

We operate in one segment for the design, development, manufacture and distribution of high-performance compound semiconductor substrates and sale of materials. In accordance with ASC topic 280, Segment Reporting, our chief operating decision-maker has been identified as our Chief Executive Officer, who reviews operating results to make decisions about allocating resources and assessing performance for the Company. Since we operate in one segment, all financial segment and product line information can be found in the condensed consolidated financial statements.

The following table represents revenue amounts (in thousands) reported for products shipped to customers in the corresponding geographic region:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Europe (primarily Germany)	$	4,995	$	4,385	$	13,946	$	14,992
China		4,766		3,296		12,041		10,154
Japan		3,499		1,939		8,096		7,176
Asia Pacific (excluding China, Taiwan and Japan)		3,239		2,750		8,391		8,277
Taiwan		2,995		4,131		11,779		10,654
North America (primarily the United States)		2,378		1,870		6,827		8,192
Total	$	21,872	$	18,371	$	61,080	$	59,445

Long-lived assets consist primarily of property, plant and equipment, and are attributed to the geographic location in which they are located. Long-lived assets by geographic region were as follows (in thousands):

	As of
	September 30,		December 31,
	2016		2015
Long-lived assets by geographic region, net of depreciation:
North America	$	618	$	542
China		28,767		30,880
	$	29,385	$	31,422

Significant Customers

One customer, IQE Group, represented 12% of our revenue for the three months ended September 30, 2016 while two customers, Landmark and IQE Group, represented 14% and 12%, respectively, of our revenue for the three months ended September 30, 2015. Our top five customers, although not the same five customers for each period, represented 38% and 45% of our revenue for the three months ended September 30, 2016 and 2015, respectively.

Two customers, IQE Group and Landmark, represented 11% and 10%, respectively, of our revenue for the nine months ended September 30, 2016, while no customer represented more than 10% of our revenue for the nine months ended September 30, 2015. Our top five customers, although not the same five customers for each period, represented 40% and 39% of our revenue for the nine months ended September 30, 2016 and 2015, respectively.

We perform ongoing credit evaluations of our customers’ financial condition, and limit the amount of credit extended when deemed necessary, but generally do not require collateral. Two customers accounted for 14% and 10% of our accounts receivable balance as of September 30, 2016, while one customer accounted for 22% of our accounts receivable balance as of December 31, 2015.