Product Warranty

3 Months Ended

Mar. 31, 2015

Note 8.Product Warranty

The Company generally offers a one year warranty for all of its systems, the terms and conditions of which vary depending upon the product sold. For all systems sold, the Company accrues a liability for the estimated cost of standard warranty at the time of system shipment and defers the portion of systems revenue attributable to the fair value of non-standard warranty. Costs for non-standard warranty are expensed as incurred. Factors that affect the Company’s warranty liability include the number of installed units, historical and anticipated product failure rates, material usage and service labor costs. The Company periodically assesses the adequacy of its recorded liability and adjusts the amount as necessary.

The changes in the Company’s product warranty liability are as follows:

	Three months ended March 31,
	2015			2014
	(in thousands)
Balance at January 1 (beginning of year)	$	1,526		$	1,428
Warranties issued during the period	1,080			647
Settlements made during the period	(566		)	(467		)
Changes in estimate of liability for pre-existing warranties during the period	123			12
Balance at March 31 (end of period)	$	2,163		$	1,620

Amount classified as current	$	1,909		$	1,496
Amount classified within other long-term liabilities	254			124
Total warranty liability	$	2,163		$	1,620