19.

QUARTERLY FINANCIAL INFORMATION - UNAUDITED

(in thousands except share and per share information)

	March 31 ⁽¹⁾			June 30			September 30			December 31
Quarter ended:
2016
Total revenue	$	20,661		$	23,140		$	23,257		$	19,403
Total cost of revenue		12,626			13,983			14,660			12,931
Gross profit		8,035			9,157			8,597			6,472
Gross profit percent		39	%		40	%		37	%		33	%
Selling, general and administrative		9,238			9,009			8,080			7,912
Depreciation and amortization		608			616			585			557
Research and development		506			527			512			471
Bad debt		7			42			—			44
Other operating expenses		—			—			5			52
Operating (loss)	$	(2,324)		$	(1,037)		$	(585)		$	(2,564)
Net (loss)	$	(2,668)		$	(1,481)		$	(507)		$	(2,610)
Earnings (loss) per common share:
Basic income (loss) per common share	$	(0.13)		$	(0.07)		$	(0.02)		$	(0.12)
Diluted income (loss) per common share	$	(0.13)		$	(0.07)		$	(0.02)		$	(0.12)
Basic and diluted weighted average common shares outstanding		20,878,549			20,889,052			20,906,781			20,916,559

Quarter ended:
2015
Total revenue ⁽²⁾	$	16,637		$	22,872		$	24,845		$	21,886
Total cost of revenue ⁽²⁾ ⁽³⁾		10,416			14,599			15,506			13,427
Gross profit		6,221			8,273			9,339			8,459
Gross profit percent		37	%		36	%		38	%		39	%
Selling, general and administrative		8,685			7,894			7,941			8,503
Depreciation and amortization ⁽³⁾		986			609			632			635
Research and development		443			531			532			342
Bad debt		83			54			67			(9)
Other operating expenses		2			—			—			56
Operating (loss)	$	(3,978)		$	(815)		$	167		$	(1,068)
Net (loss)	$	(4,076)		$	(504)		$	(59)		$	(1,348)
Earnings (loss) per common share:
Basic income (loss) per common share	$	(0.20)			(0.02)			(0.00)			(0.06)
Diluted income (loss) per common share	$	(0.20)			(0.02)			(0.00)			(0.06)
Basic and diluted weighted average common shares outstanding		20,774,000			20,786,081			20,802,217			20,807,205

(1)

On March 5, 2015, the Company closed on an Asset Purchase Agreement to acquire certain assets and assume certain liabilities of Tectrol, Inc., a Toronto, Canada corporation. The acquisition was effective March 1, 2015 and results are included from that date in the Company’s Power and Electromechanical segment.

(2)

Revenue and cost of revenue have been revised. Immaterial revisions made to 2015 amounts were related to sales of raw material components to a vendor that in turn, sold finished goods inventory to the Company that included the raw material components that we had sold to the vendor. Revisions decreased total revenue and total cost of revenue for the first, second third and fourth quarters of 2015 by $216 thousand, $100 thousand, $83 thousand and $28 thousand, respectively. These revisions had no effect on gross profit, operating (loss) or net (loss). For more information see Note 2. Summary of Significant Accounting Policies - Revisions.

(3)

In the fourth quarter of 2015, the Company reclassified $133 thousand of depreciation and amortization at CUI-Canada to cost of revenue. During 2016, for comparative purposes this 2015 adjustment was reclassified according to the quarter when the original expense was recorded. Accordingly, in the first, second, third and fourth quarters of 2015, $12 thousand, $37 thousand, $41 thousand and $43 thousand, respectively, of depreciation and amortization was reclassified to cost of revenue and the $133 thousand adjustment representing the full year reclassification was removed from the fourth quarter 2015 presentation.