SIGNIFICANT CUSTOMERS AND EXPORT SALES

3 Months Ended

Mar. 31, 2014

Risks and Uncertainties [Abstract]

SIGNIFICANT CUSTOMERS AND EXPORT SALES [Text Block]

SIGNIFICANT CUSTOMERS AND INTERNATIONAL SALES:

Segment Reporting

The Company is organized and operates as one reportable segment, the design, development, manufacture and marketing of integrated circuits and related components for use primarily in the high-voltage power-conversion market. The Company's chief operating decision maker, the Chief Executive Officer, reviews financial information presented on a consolidated basis for purposes of making operating decisions and assessing financial performance.

Customer Concentration

Ten customers accounted for approximately 59% and 58% of net revenues for the three months ended March 31, 2014 and 2013, respectively. A significant portion of these revenues are attributable to sales of the Company’s products to distributors of electronic components. These distributors sell the Company’s products to a broad, diverse range of end users, including OEMs and merchant power supply manufacturers.

Customers representing 10% or more of total net revenues are as follows:

	Three Months Ended
	March 31,
Customer	2014		2013
A	19	%	19	%
B	*		10	%

____________________

* Total customer revenue was less than 10% of net revenues.

Customers A and B are distributors of the Company's products. No other customers accounted for 10% or more of the Company's net revenues in the periods mentioned.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash investments and trade receivables. The Company has cash investment policies that limit cash investments to low-risk investments. With respect to trade receivables, the Company performs ongoing evaluations of its customers' financial conditions and requires letters of credit whenever deemed necessary. Additionally, the Company establishes an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends related to past write-offs and other relevant information. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers. As of March 31, 2014, and December 31, 2013, 67% and 71%, respectively, of accounts receivable were concentrated with the Company's top 10 customers.

The following customers represented 10% or more of accounts receivable:

Customer	March 31, 2014		December 31, 2013
Avnet	27	%	21	%
ATM Electronic Corporation	11	%	17	%

Customers A and B are distributors of the Company’s products. No other customers accounted for 10% or more of the Company’s accounts receivable in these periods.

International Sales

The Company markets its products globally through its sales personnel and a worldwide network of independent sales representatives and distributors. As a percentage of total net revenues, international sales, which consist of domestic and foreign sales to distributors and direct customers outside of the United States of America, comprise the following:

	Three Months  Ended
	March 31,
	2014		2013
Hong Kong/China	44	%	44	%
Taiwan	16	%	15	%
Korea	11	%	13	%
Western Europe (excluding Germany)	11	%	12	%
Japan	6	%	5	%
Singapore	2	%	3	%
Germany	2	%	2	%
Other	3	%	1	%
Total foreign revenue	95	%	95	%

The remainder of the Company’s sales is to customers within the United States of America.

Product Sales

Net revenues consist primarily of sales of the Company's high-voltage integrated-circuit products, IGBT drivers and high-voltage silicon diodes. When evaluating the Company's net revenues, the Company categorizes its sales into the following four major end-market categories; communications, computer, consumer and industrial. The table below provides the percentage of net sales activity by end markets served on a comparative basis for the three months ended March 31, 2014 and 2013:

	Three Months Ended
	March 31,
End Market	2014		2013
Communications	18	%	22	%
Computer	10	%	10	%
Consumer	37	%	36	%
Industrial	35	%	32	%