2015 Q1 Form 10-K Financial Statement

#000120037515000008 Filed on March 06, 2015

View on sec.gov

Income Statement

Concept 2015 Q1 2014 Q4 2014
Revenue $6.798M $14.19M $35.31M
YoY Change -3.9% 48.98% 10.6%
Cost Of Revenue $1.456M $3.550M $9.726M
YoY Change -42.31% -25.48% -33.17%
Gross Profit $5.342M $10.64M $25.58M
YoY Change 17.41% 123.48% 47.29%
Gross Profit Margin 78.58% 74.98% 72.45%
Selling, General & Admin $5.578M $5.150M $21.94M
YoY Change -8.74% -10.95% -18.47%
% of Gross Profit 104.42% 48.4% 85.76%
Research & Development $5.293M $5.050M $22.76M
YoY Change 9.5% -42.8% -28.0%
% of Gross Profit 99.08% 47.46% 88.95%
Depreciation & Amortization $558.0K $1.470M $6.680M
YoY Change -45.08% -40.49% -35.21%
% of Gross Profit 10.45% 13.82% 26.11%
Operating Expenses $12.33M $10.19M $54.42M
YoY Change -8.49% -47.41% -25.52%
Operating Profit -$5.529M $450.0K -$19.11M
YoY Change -13.56% -103.08% -53.55%
Interest Expense $0.00 $0.00 $0.00
YoY Change -100.0% -100.0% -100.0%
% of Operating Profit 0.0%
Other Income/Expense, Net $25.00K -$50.00K $234.0K
YoY Change -78.81% 150.0% -23.03%
Pretax Income -$5.550M $400.0K -$20.98M
YoY Change -14.68% -104.06% -49.68%
Income Tax $12.00K $60.00K -$256.0K
% Of Pretax Income 15.0%
Net Earnings -$5.562M $350.0K -$19.07M
YoY Change -12.75% -103.57% -53.83%
Net Earnings / Revenue -81.82% 2.47% -54.01%
Basic Earnings Per Share
Diluted Earnings Per Share -$143.4K $9.056K -$500.0K
COMMON SHARES
Basic Shares Outstanding 39.70M shares 39.55M shares
Diluted Shares Outstanding

Balance Sheet

Concept 2015 Q1 2014 Q4 2014
SHORT-TERM ASSETS
Cash & Short-Term Investments $22.20M $26.49M $26.50M
YoY Change -8.13% 5.38% 5.58%
Cash & Equivalents $22.16M $26.49M $26.50M
Short-Term Investments $0.00 $0.00
Other Short-Term Assets $1.300M $1.300M $1.300M
YoY Change -58.06% -65.79% -65.79%
Inventory $992.0K $1.395M $1.400M
Prepaid Expenses
Receivables $3.215M $3.870M $3.900M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $27.63M $33.01M $33.00M
YoY Change -19.3% -7.75% -7.82%
LONG-TERM ASSETS
Property, Plant & Equipment $3.499M $3.995M $4.000M
YoY Change -52.69% -52.7% -52.38%
Goodwill $3.241M $3.241M
YoY Change 0.0% 0.0%
Intangibles $5.342M $6.186M
YoY Change -38.71% -35.29%
Long-Term Investments $700.0K $700.0K $700.0K
YoY Change -50.0% -12.5% -12.5%
Other Assets $284.0K $294.0K $1.000M
YoY Change 36.54% -3.92% 0.0%
Total Long-Term Assets $13.79M $15.12M $15.10M
YoY Change -36.51% -34.45% -34.35%
TOTAL ASSETS
Total Short-Term Assets $27.63M $33.01M $33.00M
Total Long-Term Assets $13.79M $15.12M $15.10M
Total Assets $41.42M $48.12M $48.10M
YoY Change -25.98% -18.22% -18.2%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $1.952M $4.673M $4.700M
YoY Change -44.02% 17.98% 17.5%
Accrued Expenses $2.065M $2.619M $5.600M
YoY Change -23.49% 62.47% 7.69%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $11.87M $13.74M $13.70M
YoY Change -9.32% 22.64% 22.32%
LONG-TERM LIABILITIES
Long-Term Debt $0.00 $0.00 $0.00
YoY Change
Other Long-Term Liabilities $4.154M $2.528M $8.100M
YoY Change -15.22% -49.88% 30.65%
Total Long-Term Liabilities $4.154M $2.528M $8.100M
YoY Change -15.22% -49.88% 30.65%
TOTAL LIABILITIES
Total Short-Term Liabilities $11.87M $13.74M $13.70M
Total Long-Term Liabilities $4.154M $2.528M $8.100M
Total Liabilities $16.02M $16.26M $21.80M
YoY Change -17.35% -6.3% 25.29%
SHAREHOLDERS EQUITY
Retained Earnings -$281.5M -$275.9M
YoY Change 6.94% 7.42%
Common Stock $4.000K $4.000K
YoY Change 0.0% 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $21.62M $26.31M $26.30M
YoY Change
Total Liabilities & Shareholders Equity $41.42M $48.12M $48.10M
YoY Change -25.98% -18.22% -18.2%

Cashflow Statement

Concept 2015 Q1 2014 Q4 2014
OPERATING ACTIVITIES
Net Income -$5.562M $350.0K -$19.07M
YoY Change -12.75% -103.57% -53.83%
Depreciation, Depletion And Amortization $558.0K $1.470M $6.680M
YoY Change -45.08% -40.49% -35.21%
Cash From Operating Activities -$3.848M $4.970M $321.0K
YoY Change 60.0% -227.11% -101.4%
INVESTING ACTIVITIES
Capital Expenditures $52.00K -$30.00K $302.0K
YoY Change 147.62% -95.89% -74.3%
Acquisitions
YoY Change
Other Investing Activities $10.00K $0.00 $4.950M
YoY Change -99.72% -100.0% -65.74%
Cash From Investing Activities -$47.00K -$30.00K $4.647M
YoY Change -101.3% -93.18% -64.99%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $9.000K
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -$433.0K 30.00K -$611.0K
YoY Change 157.74% -106.82% 315.65%
NET CHANGE
Cash From Operating Activities -$3.848M 4.970M $321.0K
Cash From Investing Activities -$47.00K -30.00K $4.647M
Cash From Financing Activities -$433.0K 30.00K -$611.0K
Net Change In Cash -$4.328M 4.970M $4.357M
YoY Change -518.97% -203.76% -144.13%
FREE CASH FLOW
Cash From Operating Activities -$3.848M $4.970M $321.0K
Capital Expenditures $52.00K -$30.00K $302.0K
Free Cash Flow -$3.900M $5.000M $19.00K
YoY Change 60.76% -257.23% -100.08%

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0 USD
CY2014Q4 us-gaap Deferred Income Tax Liabilities
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186000 USD
CY2013Q4 us-gaap Deferred Revenue Current
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2001000 USD
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3497000 USD
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1114000 USD
CY2014Q4 us-gaap Deferred Revenue Noncurrent
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3813000 USD
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CY2013 us-gaap Deferred State And Local Income Tax Expense Benefit
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CY2014 us-gaap Deferred State And Local Income Tax Expense Benefit
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0 USD
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0 USD
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933000 USD
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1198000 USD
CY2014Q4 us-gaap Deferred Tax Assets Deferred Income
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2697000 USD
CY2013Q4 us-gaap Deferred Tax Assets Goodwill And Intangible Assets
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4208000 USD
CY2014Q4 us-gaap Deferred Tax Assets Goodwill And Intangible Assets
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4639000 USD
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86294000 USD
CY2014Q4 us-gaap Deferred Tax Assets Gross
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112000 USD
CY2014Q4 us-gaap Deferred Tax Assets Investments
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148000 USD
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0 USD
CY2014Q4 us-gaap Deferred Tax Assets Liabilities Net
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-110000 USD
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67507000 USD
CY2014Q4 us-gaap Deferred Tax Assets Operating Loss Carryforwards
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70666000 USD
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159000 USD
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101000 USD
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2247000 USD
CY2014Q4 us-gaap Deferred Tax Assets Property Plant And Equipment
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2295000 USD
CY2013Q4 us-gaap Deferred Tax Assets Tax Credit Carryforwards
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4194000 USD
CY2014Q4 us-gaap Deferred Tax Assets Tax Credit Carryforwards
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4421000 USD
CY2013Q4 us-gaap Deferred Tax Assets Tax Deferred Expense Compensation And Benefits Employee Compensation
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3626000 USD
CY2014Q4 us-gaap Deferred Tax Assets Tax Deferred Expense Compensation And Benefits Employee Compensation
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2701000 USD
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3043000 USD
CY2014Q4 us-gaap Deferred Tax Assets Tax Deferred Expense Compensation And Benefits Share Based Compensation Cost
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2988000 USD
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86294000 USD
CY2014Q4 us-gaap Deferred Tax Assets Valuation Allowance
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91513000 USD
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0 USD
CY2014Q4 us-gaap Deferred Tax Liabilities Other
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186000 USD
CY2014 us-gaap Disposal Group Not Discontinued Operation Loss Gain On Write Down
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188000 USD
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-0.84
CY2013 us-gaap Earnings Per Share Basic And Diluted
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-1.08
CY2014 us-gaap Earnings Per Share Basic And Diluted
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0 USD
CY2013 us-gaap Gain Or Loss On Sale Of Stock In Subsidiary
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0 USD
CY2014 us-gaap Income Loss From Continuing Operations Before Income Taxes Minority Interest And Income Loss From Equity Method Investments
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-19327000 USD
CY2012 us-gaap Income Tax Expense Benefit
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270000 USD
CY2013 us-gaap Income Tax Expense Benefit
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-87000 USD
CY2013 us-gaap Effect Of Exchange Rate On Cash And Cash Equivalents
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0 USD
CY2014 us-gaap Effect Of Exchange Rate On Cash And Cash Equivalents
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0 USD
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3625000 USD
CY2014Q4 us-gaap Employee Related Liabilities Current
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2946000 USD
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3814000 USD
CY2014 us-gaap Finite Lived Intangible Asset Useful Life
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P6Y
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15316000 USD
CY2014Q4 us-gaap Finite Lived Intangible Assets Accumulated Amortization
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18690000 USD
CY2014Q4 us-gaap Finite Lived Intangible Assets Amortization Expense Next Twelve Months
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3374000 USD
CY2014Q4 us-gaap Finite Lived Intangible Assets Amortization Expense Year Two
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2812000 USD
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24876000 USD
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24876000 USD
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9560000 USD
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6186000 USD
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-1551000 USD
CY2013 us-gaap Gain Loss On Sale Of Property Plant Equipment
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0 USD
CY2014 us-gaap Gain Loss On Sale Of Property Plant Equipment
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CY2012 us-gaap Gain Loss On Sales Of Assets And Asset Impairment Charges
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0 USD
CY2013 us-gaap Gain Loss On Sales Of Assets And Asset Impairment Charges
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0 USD
CY2014 us-gaap Gain Loss On Sales Of Assets And Asset Impairment Charges
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-87000 USD
CY2014 us-gaap Gain Or Loss On Sale Of Stock In Subsidiary
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760000 USD
CY2013Q4 us-gaap Goodwill
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3241000 USD
CY2014Q4 us-gaap Goodwill
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3241000 USD
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0 USD
CY2014 us-gaap Goodwill Impairment Loss
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0 USD
CY2013 us-gaap Goodwill Period Increase Decrease
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0 USD
CY2014 us-gaap Goodwill Period Increase Decrease
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0 USD
CY2013Q4 us-gaap Impairment Charge On Reclassified Assets
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1571000 USD
CY2014 us-gaap Impairment Charge On Reclassified Assets
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698000 USD
CY2014 us-gaap Impairment Of Intangible Assets Finitelived
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0 USD
CY2012 us-gaap Impairment Of Investments
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800000 USD
CY2013 us-gaap Impairment Of Investments
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0 USD
CY2014 us-gaap Impairment Of Investments
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0 USD
CY2012 us-gaap Impairment Of Long Lived Assets Held For Use
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0 USD
CY2013 us-gaap Impairment Of Long Lived Assets Held For Use
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1582000 USD
CY2014 us-gaap Impairment Of Long Lived Assets Held For Use
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1841000 USD
CY2014Q4 us-gaap Incentive From Lessor
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1700000 USD
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CY2013 us-gaap Income Loss From Continuing Operations Before Income Taxes Minority Interest And Income Loss From Equity Method Investments
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-41390000 USD
CY2014 us-gaap Income Tax Expense Benefit
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CY2012 us-gaap Income Tax Reconciliation Change In Deferred Tax Assets Valuation Allowance
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9716000 USD
CY2012 us-gaap Income Tax Reconciliation State And Local Income Taxes
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-1063000 USD
CY2013 us-gaap Income Tax Reconciliation State And Local Income Taxes
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-1948000 USD
CY2014 us-gaap Income Tax Reconciliation State And Local Income Taxes
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249000 USD
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0 USD
CY2013 us-gaap Income Tax Reconciliation Tax Credits Research
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195000 USD
CY2013 us-gaap Income Tax Reconciliation Change In Deferred Tax Assets Valuation Allowance
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17392000 USD
CY2014 us-gaap Income Tax Reconciliation Change In Deferred Tax Assets Valuation Allowance
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6042000 USD
CY2012 us-gaap Income Tax Reconciliation Change In Enacted Tax Rate
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1493000 USD
CY2013 us-gaap Income Tax Reconciliation Change In Enacted Tax Rate
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0 USD
CY2014 us-gaap Income Tax Reconciliation Change In Enacted Tax Rate
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0 USD
CY2012 us-gaap Income Tax Reconciliation Foreign Income Tax Rate Differential
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7000 USD
CY2013 us-gaap Income Tax Reconciliation Foreign Income Tax Rate Differential
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-108000 USD
CY2014 us-gaap Income Tax Reconciliation Foreign Income Tax Rate Differential
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447000 USD
CY2012 us-gaap Income Tax Reconciliation Income Tax Expense Benefit At Federal Statutory Income Tax Rate
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-10399000 USD
CY2013 us-gaap Income Tax Reconciliation Income Tax Expense Benefit At Federal Statutory Income Tax Rate
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-14073000 USD
CY2014 us-gaap Income Tax Reconciliation Income Tax Expense Benefit At Federal Statutory Income Tax Rate
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-6571000 USD
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204000 USD
CY2013 us-gaap Income Tax Reconciliation Nondeductible Expense Other
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-1272000 USD
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-364000 USD
CY2012 us-gaap Income Tax Reconciliation Nondeductible Expense Share Based Compensation Cost
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312000 USD
CY2013 us-gaap Income Tax Reconciliation Nondeductible Expense Share Based Compensation Cost
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117000 USD
CY2014 us-gaap Income Tax Reconciliation Nondeductible Expense Share Based Compensation Cost
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-2000 USD
CY2014 us-gaap Income Tax Reconciliation Tax Credits Research
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57000 USD
CY2012 us-gaap Income Taxes Paid Net
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126000 USD
CY2013 us-gaap Income Taxes Paid Net
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103000 USD
CY2014 us-gaap Income Taxes Paid Net
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15000 USD
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-6710000 USD
CY2013 us-gaap Increase Decrease In Accounts Payable
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308000 USD
CY2014 us-gaap Increase Decrease In Accounts Payable
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713000 USD
CY2012 us-gaap Increase Decrease In Accounts Receivable
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-11372000 USD
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-1629000 USD
CY2014 us-gaap Increase Decrease In Accounts Receivable
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-1587000 USD
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0 USD
CY2013 us-gaap Increase Decrease In Assets Held For Sale
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2179000 USD
CY2014 us-gaap Increase Decrease In Assets Held For Sale
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-333000 USD
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-1789000 USD
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1629000 USD
CY2014 us-gaap Increase Decrease In Deferred Revenue
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4195000 USD
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-3290000 USD
CY2013 us-gaap Increase Decrease In Employee Related Liabilities
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130000 USD
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-530000 USD
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-3186000 USD
CY2013 us-gaap Increase Decrease In Inventories
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185000 USD
CY2014 us-gaap Increase Decrease In Inventories
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-92000 USD
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197000 USD
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CY2014 us-gaap Increase Decrease In Other Accrued Liabilities
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555000 USD
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1330000 USD
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-337000 USD
CY2014 us-gaap Increase Decrease In Other Noncurrent Assets
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78000 USD
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0 USD
CY2013 us-gaap Increase Decrease In Other Operating Assets
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1857000 USD
CY2014 us-gaap Increase Decrease In Other Operating Assets
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0 USD
CY2012 us-gaap Increase Decrease In Prepaid Deferred Expense And Other Assets
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3051000 USD
CY2013 us-gaap Increase Decrease In Prepaid Deferred Expense And Other Assets
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-850000 USD
CY2014 us-gaap Increase Decrease In Prepaid Deferred Expense And Other Assets
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339000 USD
CY2012 us-gaap Increase Decrease In Restricted Cash
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0 USD
CY2013 us-gaap Increase Decrease In Restricted Cash
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-800000 USD
CY2014 us-gaap Increase Decrease In Restricted Cash
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0 USD
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693000 USD
CY2014Q4 us-gaap Inventory Finished Goods
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1246000 USD
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1487000 USD
CY2014Q4 us-gaap Inventory Net
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1395000 USD
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763000 USD
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84000 USD
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31000 USD
CY2014Q4 us-gaap Inventory Work In Process
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65000 USD
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252000 USD
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60000 USD
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18000 USD
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688000 USD
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1257000 USD
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16711000 USD
CY2013 us-gaap Lease And Rental Expense
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3600000 USD
CY2014 us-gaap Lease And Rental Expense
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3400000 USD
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58840000 USD
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48122000 USD
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11199000 USD
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13735000 USD
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600000 USD
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3005000 USD
CY2014Q4 us-gaap Marketable Securities
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0 USD
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795000 USD
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13272000 USD
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4647000 USD
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CY2013 us-gaap Net Cash Provided By Used In Operating Activities
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CY2014 us-gaap Net Cash Provided By Used In Operating Activities
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321000 USD
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18312000 USD
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10475000 USD
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1 operating_segment
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118811000 USD
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73068000 USD
CY2014 us-gaap Operating Expenses
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54418000 USD
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-30513000 USD
CY2013 us-gaap Operating Income Loss
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-41146000 USD
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-19111000 USD
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14037000 USD
CY2014Q4 us-gaap Operating Leases Future Minimum Payments Due Current
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2743000 USD
CY2014Q4 us-gaap Operating Leases Future Minimum Payments Due Future Minimum Sublease Rentals
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1400000 USD
CY2014Q4 us-gaap Operating Leases Future Minimum Payments Due In Five Years
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2818000 USD
CY2014Q4 us-gaap Operating Leases Future Minimum Payments Due In Four Years
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2736000 USD
CY2014Q4 us-gaap Operating Leases Future Minimum Payments Due In Three Years
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2677000 USD
CY2014Q4 us-gaap Operating Leases Future Minimum Payments Due In Two Years
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2827000 USD
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236000 USD
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0 USD
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400000 USD
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306000 USD
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294000 USD
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271000 USD
CY2013 us-gaap Other Comprehensive Income Loss Net Of Tax Portion Attributable To Parent
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104000 USD
CY2014 us-gaap Other Comprehensive Income Loss Net Of Tax Portion Attributable To Parent
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-110000 USD
CY2012 us-gaap Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Tax
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70000 USD
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68000 USD
CY2014 us-gaap Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Tax
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0 USD
CY2012 us-gaap Other Expenses
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326000 USD
CY2013 us-gaap Other Expenses
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304000 USD
CY2014 us-gaap Other Expenses
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234000 USD
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5044000 USD
CY2014Q4 us-gaap Other Liabilities Noncurrent
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4263000 USD
CY2012 us-gaap Payments For Restructuring
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1123000 USD
CY2013 us-gaap Payments For Restructuring
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877000 USD
CY2014 us-gaap Payments For Restructuring
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238000 USD
CY2012 us-gaap Payments Related To Tax Withholding For Share Based Compensation
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0 USD
CY2013 us-gaap Payments Related To Tax Withholding For Share Based Compensation
PaymentsRelatedToTaxWithholdingForShareBasedCompensation
465000 USD
CY2014 us-gaap Payments Related To Tax Withholding For Share Based Compensation
PaymentsRelatedToTaxWithholdingForShareBasedCompensation
815000 USD
CY2012 us-gaap Payments To Acquire Marketable Securities
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20638000 USD
CY2013 us-gaap Payments To Acquire Marketable Securities
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0 USD
CY2014 us-gaap Payments To Acquire Marketable Securities
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0 USD
CY2012 us-gaap Payments To Acquire Property Plant And Equipment
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2933000 USD
CY2013 us-gaap Payments To Acquire Property Plant And Equipment
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1175000 USD
CY2014 us-gaap Payments To Acquire Property Plant And Equipment
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302000 USD
CY2013Q4 us-gaap Preferred Stock Par Or Stated Value Per Share
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0.0001
CY2014Q4 us-gaap Preferred Stock Par Or Stated Value Per Share
PreferredStockParOrStatedValuePerShare
0.0001
CY2013Q4 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
5000000 shares
CY2014Q4 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
5000000 shares
CY2013Q4 us-gaap Preferred Stock Shares Issued
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187000 USD
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158000 USD
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500000 USD
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CY2014 us-gaap Concentration Risk Credit Risk
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:18px;text-align:left;padding-left:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Concentrations of Credit Risk</font></div><div style="line-height:120%;padding-top:12px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our financial instruments that are potentially subject to concentration of credit risk primarily consist of: cash equivalents, short-term investments, accounts receivable, marketable securities, and restricted cash. We invest cash that is not required for immediate operating needs principally in money market funds and corporate securities through banks and other financial institutions in the United States, as well as in foreign countries.</font></div></div>
CY2014 us-gaap Nature Of Operations
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:12px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Description of Business</font></div><div style="line-height:120%;padding-top:12px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In these notes to the consolidated financial statements, the &#8220;Company,&#8221; "we," "us,'" and "our" refers to Codexis, Inc. and its subsidiaries on a consolidated basis.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We develop biocatalysts for the pharmaceutical and fine chemicals markets. Our proven technologies enable scale-up and implementation of biocatalytic solutions to meet customer needs for rapid, cost-effective and sustainable process development, from research to manufacturing.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Biocatalysts are enzymes or microbes that initiate and/or accelerate chemical reactions. Manufacturers have historically used naturally occurring biocatalysts to produce many goods used in everyday life. However, inherent limitations in naturally occurring biocatalysts have restricted their commercial use. Our proprietary CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> </font><font style="font-family:inherit;font-size:10pt;">protein engineering </font><font style="font-family:inherit;font-size:10pt;">technology platform, which introduces genetic mutations into microorganisms in order to give rise to changes in enzymes that they produce, is able to overcome many of these limitations, allowing us to evolve and optimize biocatalysts to perform specific and desired chemical reactions at commercial scale. Once potentially beneficial mutations are identified through this proprietary process, combinations of these mutations can then be tested until variant enzymes have been created that exhibit marketable performance characteristics superior to competitive products. This process allows for continuous, efficient improvements to the performance of enzymes. In the past, we implemented our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> </font><font style="font-family:inherit;font-size:10pt;">protein engineering </font><font style="font-family:inherit;font-size:10pt;">technology platform through paid collaborations with our customers. In July 2014, we entered into our first license agreement pursuant to which we granted a license to a global pharmaceutical company to use our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> </font><font style="font-family:inherit;font-size:10pt;">protein engineering </font><font style="font-family:inherit;font-size:10pt;">technology platform for their internal development purposes, and we are pursuing additional license opportunities with other customers.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We have commercialized our technology and products in the pharmaceuticals market, which is our primary business focus. Our pharmaceutical customers, which include several of the largest global pharmaceutical companies, use our technology, products and services in their manufacturing processes and process development, including in the production of some of the world's best-selling and fastest growing drugs.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We also use our technology to develop biocatalysts for use in the fine chemicals market. The fine chemicals market is similar to our pharmaceutical business and consists of several large market verticals, including: food, animal feed, flavors, fragrances, and agricultural chemicals.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We have also used our technology to develop an early stage, novel enzyme therapeutic product candidate for the potential treatment of phenylketonuria ("PKU") in humans. PKU is an inherited metabolic disorder in which the enzyme that converts the essential amino acid phenylalanine into tyrosine is deficient.</font></div></div>
CY2014 us-gaap Use Of Estimates
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:18px;text-align:left;padding-left:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Use of Estimates</font></div><div style="line-height:120%;padding-top:12px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. We regularly assess these estimates which primarily affect revenue recognition, accounts receivable, inventories, the valuation of investment securities and marketable securities, assets held for sale, intangible assets, goodwill arising out of business acquisitions, accrued liabilities, stock awards and the valuation allowances associated with deferred tax assets. Actual results could differ from those estimates and such differences may be material to the consolidated financial statements.</font></div></div>

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