Inventories, net

12 Months Ended

Dec. 31, 2015

Note 7. Inventories, net

The components of inventories are as follows:

	December 31,
	2015		2014
	(in thousands)
Raw materials	$	78,566	$	65,723
Work in process		29,219		22,358
Finished goods		8,119		15,982

	$	115,904	$	104,063

When recorded, inventory reserves are intended to reduce the carrying value of inventories to their net realizable value. The Company establishes inventory reserves when conditions exist that indicate inventory may be in excess of anticipated demand or is obsolete based upon assumptions about future demand for the Company's products or market conditions. The Company regularly evaluates the ability to realize the value of inventories based on a combination of factors including the following: forecasted sales or usage, estimated product end of life dates, estimated current and future market value and new product introductions. Purchasing and usage alternatives are also explored to mitigate inventory exposure. In 2015, the Company recorded an overall decrease of $13.1 million in the inventory reserves, which consisted of disposals due to obsolescence and excess inventory of $10.4 million and a $3.8 million reduction in reserve for sales of previously fully reserved inventory, partially offset by a provision charge to the reserve of $1.1 million. As of December 31, 2015 and 2014, inventories are stated net of inventory reserves of $10.5 million and $23.6 million respectively.

During 2015, the Company recorded a charge to cost of sales of $0.5 million to reflect the lower of cost or market value. During 2014, the Company recorded a charge to cost of sales of $1.0 million due to production levels below normal capacity and $0.8 million to reflect the lower of cost or market value associated with evaluation units in the field. During 2013, the Company recorded charges to cost of sales of $0.6 million and $0.7 million due to production levels below normal capacity and lower of cost or market, respectively.