Segment Information

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Segment Reporting Disclosure

Segment Information

During the first quarter of 2015, the Company implemented strategic and organizational changes that resulted in measuring the performance of the Company's product line in two segments: Software-Systems and Embedded Products and Hardware Services. The Company's Chief Executive Officer, or chief operating decision maker, regularly reviews discrete financial information for purposes of allocating resources and assessing the performance of each segment:

• Software-Systems. Software-Systems products are comprised of three product families: FlowEngine, MediaEngine and CellEngine.

• Embedded Products and Hardware Services. These hardware based products provide platforms to control and move data in the core of the telecom network.

Cost of sales, research and development and selling, general and administrative expenses are allocated to Software-Systems and Embedded Products and Hardware Services. Expenses, reversals, gains and losses not allocated to Software-Systems or Embedded Product and Hardware Services include amortization of acquired intangible assets, stock-based compensation, restructuring and other charges, and other one-time non-recurring events. These items are allocated to corporate and other.

The Company recorded the following revenues, gross margin and income (loss) from operations by operating segment for the three and six months ended June 30, 2015 and 2014 (in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2015		2014		2015		2014
Revenue
Software-Systems	$	14,170	$	10,400	$	23,859	$	18,241
Embedded Products and Hardware Services	32,879		39,564		71,877		75,522
Total revenues	$	47,049	$	49,964	$	95,736	$	93,763

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2015			2014			2015			2014
Gross margin
Software-Systems	$	7,945		$	5,816		$	13,273		$	11,014
Embedded Products and Hardware Services	6,725			8,397			16,069			16,532
Corporate and other	(2,069		)	(2,206		)	(4,115		)	(4,391		)
Total gross margin	$	12,601		$	12,007		$	25,227		$	23,155

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2015			2014			2015			2014
Income (loss) from operations
Software-Systems	$	(967	)	$	(1,848	)	$	(3,869	)	$	(4,712	)
Embedded Products and Hardware Services	2,373			9			6,330			(819		)
Corporate and other	(4,939		)	(5,590		)	(12,987		)	(11,362		)
Total loss from operations	$	(3,533	)	$	(7,429	)	$	(10,526	)	$	(16,893	)

Assets are not allocated to segments for internal reporting presentations. A portion of depreciation is allocated to the respective segment. It is impracticable for the Company to separately identify the amount of depreciation by segment that is included in the measure of segment profit or loss.

Revenues by geographic area were as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2015		2014		2015		2014
United States	$	18,472	$	19,025	$	39,644	$	34,731
Other North America	242		579		287		1,703
China	8,862		7,953		20,555		14,980
Japan	3,761		2,674		6,144		9,882
India	5,186		1,388		5,935		1,627
Other Asia Pacific	3,816		3,585		6,176		6,606
Asia Pacific ("APAC")	21,625		15,600		38,810		33,095
Netherlands	2,825		6,130		7,187		11,169
Other EMEA	3,885		8,630		9,808		13,065
Europe, the Middle East and Africa (“EMEA”)	6,710		14,760		16,995		24,234
Foreign Countries	28,577		30,939		56,092		59,032
Total	$	47,049	$	49,964	$	95,736	$	93,763

Long-lived assets by geographic area are as follows (in thousands):

	June 30, 2015		December 31, 2014
Property and equipment, net
United States	$	3,796	$	4,558
Other North America	377		672
China	1,609		2,427
Other APAC	2		11
Total APAC	1,611		2,438
India	1,839		2,115
Other EMEA	2		3
Total EMEA	1,841		2,118
Foreign Countries	3,829		5,228
Total property and equipment, net	$	7,625	$	9,786
Intangible assets, net
United States	$	36,730	$	43,224
Total intangible assets, net	$	36,730	$	43,224

The following customers accounted for more than 10% of the Company's total revenues:
	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2015		2014		2015		2014
Nokia Networks	17.7	%	18.6	%	22.1	%	18.3	%
Philips Healthcare	N/A		16.0	%	10.0	%	15.1	%
NEC	N/A		N/A		N/A		10.6	%
An Asian Carrier	10.5	%	N/A		N/A		N/A
Mavenir Systems	10.5	%	N/A		N/A		N/A

The following customers accounted for more than 10% of accounts receivable:
	June 30, 2015		December 31, 2014
Nokia Networks	10.1	%	18.5	%
Philips Healthcare	N/A		13.9	%
An Asian Carrier	15.0	%	N/A
Sanmina SCI Corp (A)	14.6	%	N/A
Mavenir Systems	11.2	%	N/A