0001193125-14-403325 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2014	Nov. 05, 2014
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q3
Trading Symbol	MIFI
Entity Registrant Name	NOVATEL WIRELESS INC
Entity Central Index Key	0001022652
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		44,638,819

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2014	Dec. 31, 2013
Current assets:
Cash and cash equivalents	$ 20,163	$ 2,911
Marketable securities	5,097	16,612
Restricted marketable securities	0	2,566
Accounts receivable, net of allowance for doubtful accounts of $3,586 at September 30, 2014 and $2,449 at December 31, 2013	27,257	39,985
Inventories	28,139	27,793
Deferred tax assets, net	100	100
Prepaid expenses and other	4,020	5,662
Total current assets	84,776	95,629
Property and equipment, net of accumulated depreciation of $67,403 at September 30, 2014 and $62,334 at December 31, 2013	5,778	9,901
Marketable securities	261	3,443
Intangible assets, net of accumulated amortization of $13,729 at September 30, 2014 and $12,983 at December 31, 2013	1,527	2,131
Deferred tax assets, net	81	81
Other assets	622	280
Total assets	93,045	111,465
Current liabilities:
Accounts payable	29,881	24,538
Accrued expenses	20,714	23,271
Current portion of litigation settlement	7	4,326
Short-term margin loan facility	0	2,566
Total current liabilities	50,602	54,701
Warrant liability	9,727	0
Other long-term liabilities	1,615	1,848
Non-current portion of litigation settlement	5,000	10,000
Total liabilities	66,944	66,549
Commitments and Contingencies
Stockholders' equity:
Preferred stock, par value $0.001; 2,000 shares authorized	0	0
Common stock, par value $0.001; 50,000 shares authorized, 44,306 and 34,097 shares issued and outstanding at September 30, 2014 and December 31, 2013, respectively	44	34
Additional paid-in capital	456,836	441,368
Accumulated other comprehensive income	0	5
Accumulated deficit	(406,719)	(371,491)
Stockholders' equity before treasury stock	50,161	69,916
Treasury stock at cost; 2,436 common shares at September 30, 2014 and December 31, 2013, respectively	(25,000)	(25,000)
Total stockholders' equity	25,161	44,916
Total liabilities, convertible preferred stock and stockholders' equity	93,045	111,465
Convertible Series C Preferred Stock [Member]
Current liabilities:
Convertible Series C preferred stock, par value $0.001; 87 and no shares issued and outstanding at September 30, 2014 and December 31, 2013, respectively	$ 940	$ 0

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2014	Dec. 31, 2013
Accounts receivable, allowance for doubtful accounts	$ 3,586	$ 2,449
Property and equipment, accumulated depreciation	67,403	62,334
Intangible assets, accumulated amortization	$ 13,729	$ 12,983
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	2,000,000	2,000,000
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	44,306,000	34,097,000
Common stock, shares outstanding	44,306,000	34,097,000
Treasury stock, shares	2,436,000	2,436,000
Convertible Series C Preferred Stock [Member]
Convertible preferred stock, par value	$ 0.001	$ 0.001
Convertible preferred stock, shares issued	87,000	0
Convertible preferred stock, shares outstanding	87,000	0

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Income Statement [Abstract]
Net revenues	$ 44,330	$ 92,673	$ 129,884	$ 269,718
Cost of net revenues	33,844	72,290	105,343	213,463
Gross profit	10,486	20,383	24,541	56,255
Operating costs and expenses:
Research and development	7,006	12,438	24,164	39,267
Sales and marketing	2,790	5,129	9,816	16,739
General and administrative	3,381	5,128	12,881	19,209
Amortization of purchased intangible assets	141	141	421	422
Restructuring and severance charges	1,064	2,411	7,480	2,411
Total operating costs and expenses	14,382	25,247	54,762	78,048
Operating loss	(3,896)	(4,864)	(30,221)	(21,793)
Other income (expense):
Change in fair value of warrant liability	(4,788)	0	(4,788)	0
Interest income (expense), net	(63)	31	(28)	109
Other income (expense), net	(61)	59	(118)	(83)
Loss before income taxes	(8,808)	(4,774)	(35,155)	(21,767)
Income tax provision	24	319	73	340
Net loss	$ (8,832)	$ (5,093)	$ (35,228)	$ (22,107)
Net loss per share:
Basic and diluted	$ (0.23)	$ (0.15)	$ (0.99)	$ (0.65)
Weighted average shares used in computation of basic and diluted net loss per share:
Basic and diluted	38,167	34,070	35,568	33,902

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Statement of Comprehensive Income [Abstract]
Net loss	$ (8,832)	$ (5,093)	$ (35,228)	$ (22,107)
Unrealized gain (loss) on cash equivalents and marketable securities, net of tax	(5)	14	(5)	(24)
Total comprehensive loss	$ (8,837)	$ (5,079)	$ (35,233)	$ (22,131)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Cash flows from operating activities:
Net loss	$ (35,228)	$ (22,107)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	5,889	6,774
Provision for bad debts, net of recoveries	187	1,005
Provision for excess and obsolete inventory	3,033	3,069
Share-based compensation expense	1,616	2,848
Change in fair value of warrant liability	4,788	0
Non-cash income tax benefit	0	266
Changes in assets and liabilities:
Accounts receivable	11,600	(5,895)
Inventories	(3,379)	8,922
Prepaid expenses and other assets	1,300	(2,169)
Accounts payable	5,500	2,832
Accrued expenses, income taxes, and other	(4,790)	273
Net cash used in operating activities	(9,484)	(4,182)
Cash flows from investing activities:
Purchases of property and equipment	(1,513)	(5,048)
Purchases of intangible assets	(143)	0
Purchases of marketable securities	(1,255)	(22,238)
Marketable securities maturities / sales	18,513	31,731
Net cash provided by investing activities	15,602	4,445
Cash flows from financing activities:
Proceeds from the issuances of Series C preferred and common stock, net of issuance costs	14,163	0
Proceeds from the issuance of short-term debt, net of issuance costs	0	13,400
Principal repayments of short-term debt	(2,566)	(10,969)
Taxes paid on vested restricted stock units net of proceeds from stock option exercises and ESPP	(375)	(515)
Net cash provided by financing activities	11,222	1,916
Effect of exchange rates on cash and cash equivalents	(88)	(85)
Net increase in cash and cash equivalents	17,252	2,094
Cash and cash equivalents, beginning of period	2,911	16,044
Cash and cash equivalents, end of period	20,163	18,138
Cash paid during the year for:
Interest	80	31
Income taxes	83	59
Supplemental disclosures of non-cash investing activities:
Building rent incentives to fund leasehold improvements	0	359
Supplemental disclosures of non-cash financing activities:
Issuance of common stock for settlement of shareholder litigation	5,000	0
Initial fair value of warrant liability recorded upon issuance of Series C preferred and common stock	4,939	0
Change in fair value of warrant liability	$ 4,788	$ 0

Basis of Presentation	9 Months Ended
Basis of Presentation	Sep. 30, 2014
Accounting Policies [Abstract]
Basis of Presentation	1. Basis of Presentation The information contained herein has been prepared by Novatel Wireless, Inc. (the “Company”) in accordance with the rules of the Securities and Exchange Commission. The information as of September 30, 2014 and the results of the Company’s operations for the three and nine months ended September 30, 2014 and 2013 are unaudited. The condensed consolidated financial statements reflect all adjustments, consisting of only normal recurring accruals, which are, in the opinion of management, necessary for a fair statement of the results of the interim periods presented. These condensed consolidated financial statements and notes hereto should be read in conjunction with the audited financial statements from which they were derived and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013. The accounting policies used in preparing these condensed consolidated financial statements are the same as those described in the Company’s Form 10-K. The results of operations for the interim periods presented are not necessarily indicative of results to be expected for any other interim period or for the year as a whole. Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent liabilities. Actual results could differ materially from these estimates. Significant estimates include allowance for doubtful accounts receivable, provision for excess and obsolete inventory, valuation of intangible and long-lived assets, fair value of warrant liability, litigation and restructuring related accruals, provision for warranty costs, income taxes, share-based compensation expense and best estimate of selling price in a multiple element arrangement. New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (the “FASB”), which are adopted by the Company as of the specified date. Unless otherwise discussed, management believes the impact of recently issued standards, which are not yet effective, will not have a material impact on its consolidated financial statements upon adoption. In June 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-12, Compensation—Stock Compensation: Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. The standard requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. Entities are required to apply the standard for annual periods and interim periods within those annual periods, beginning after December 15, 2015. Early application is permitted. The Company is currently assessing the impact of this new guidance. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires a reporting entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance in this ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets unless those contracts are within the scope of other standards. This standard will be effective for annual reporting periods beginning after December 15, 2016. The Company is currently assessing the impact of this new guidance. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. Under the new guidance, management will be required to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The provisions of this ASU are effective for annual periods beginning after December 15, 2016, and for annual and interim periods thereafter. The Company is currently evaluating the potential changes from this ASU to its future financial reporting and disclosures.

- Definition

The entire disclosure for organization, consolidation and basis of presentation of financial statements disclosure.

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+ Details

Balance Sheet Details

9 Months Ended

Sep. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Balance Sheet Details

2. Balance Sheet Details

Marketable Securities

The Company’s portfolio of available-for-sale securities by contractual maturity consists of the following (in thousands):


September 30, 2014	Maturity in Years	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value

Available-for-sale:
Government agency securities	1 or less	$	0	$	0	$	0	$	0
Municipal bonds	1 or less		980		0		0		980
Certificates of deposit	1 or less		4,117		0		0		4,117
Corporate debentures / bonds	1 or less		0		0		0		0

Total short-term marketable securities			5,097		0		0		5,097


Available-for-sale:
Municipal bonds	1 to 2		261		0		0		261
Certificates of deposit	1 to 2		0		0		0		0
Corporate debentures / bonds	1 to 2		0		0		0		0

Total long-term marketable securities			261		0		0		261

		$	5,358	$	0	$	0	$	5,358


December 31, 2013	Maturity in Years	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value

Available-for-sale:
Government agency securities	1 or less	$	2,350	$	1	$	0	$	2,351
Municipal bonds	1 or less		2,828		1		0		2,829
Certificates of deposit	1 or less		3,360		0		0		3,360
Corporate debentures / bonds	1 or less		10,635		3		0		10,638

Total short-term marketable securities			19,173		5		0		19,178

Available-for-sale:
Municipal bonds	1 to 2		0		0		0		0
Certificates of deposit	1 to 2		1,300		0		0		1,300
Corporate debentures / bonds	1 to 2		2,143		0		0		2,143

Total long-term marketable securities			3,443		0		0		3,443

		$	22,616	$	5	$	0	$	22,621

The Company’s available-for-sale securities are carried on the condensed consolidated balance sheet at fair market value with the related unrealized gains and losses included in accumulated other comprehensive income (loss) on the condensed consolidated balance sheet, which is a separate component of stockholders’ equity. Realized gains and losses on the sale of available-for-sale marketable securities are determined using the specific-identification method.

The Company has a credit facility with one of its banks to allow margin borrowings based on and collateralized by the Company’s investments in cash equivalents and marketable securities held by that bank. Borrowings under the facility incur an interest rate at the bank’s base rate plus 1%. At September 30, 2014, the Company had approximately $2.6 million in cash equivalents and marketable securities held at this bank, and the Company’s unused borrowing capacity at September 30, 2014 under the credit facility was approximately $786,000. Any monies borrowed and interest incurred are payable on demand, and there is no express expiration date to the credit facility. During the three and nine months ended September 30, 2014, the Company did not borrow against the facility, and had no outstanding borrowings under this facility at September 30, 2014. Under the terms of the credit facility, the bank may liquidate any of the Company’s cash equivalents or marketable securities held at any time in order to recoup the outstanding balance of the facility.

As of September 30, 2014, the Company recorded a net unrealized loss of $5,000. The Company’s net unrealized loss is the result of market conditions affecting its fixed-income, debt and equity securities, which are included in accumulated other comprehensive income (loss) in the condensed consolidated balance sheet for the period then ended.

Inventories

Inventories consist of the following (in thousands):


	September 30,		December 31,
	2014		2013
Finished goods	$	24,309	$	20,870
Raw materials and components		3,830		6,923

	$	28,139	$	27,793

During the nine months ended September 30, 2014 and 2013, the Company recorded inventory write-downs of approximately $3.1 million, respectively related to excess and obsolete inventory and reductions to the carrying value of inventories as a result of lower of cost or market valuations.

Accrued Expenses

Accrued expenses consist of the following (in thousands):


	September 30,		December 31,
	2014		2013
Royalties	$	3,327	$	4,243
Payroll and related expenses		2,408		4,828
Product warranty		1,324		2,244
Market development funds and price protection		2,416		3,059
Professional fees		1,392		1,040
Deferred revenue		1,009		2,999
Restructuring		3,909		610
Other		4,929		4,248

	$	20,714	$	23,271

Accrued Warranty Obligations

Accrued warranty obligations consist of the following (in thousands):


	Three Months Ended September 30, 2014			Three Months Ended September 30, 2013			Nine Months Ended September 30, 2014			Nine Months Ended September 30, 2013

Warranty liability at beginning of period	$	1,580		$	2,451		$	2,244		$	2,329
Additions charged to operations		317			722			1,078			4,086
Deductions from/use of liability		(573	)		(818	)		(1,998	)		(4,060	)

Warranty liability at end of period	$	1,324		$	2,355		$	1,324		$	2,355

The Company generally provides one to three years of warranty coverage for products following the date of purchase and the Company accrues the estimated cost of warranty coverage as a component of cost of net revenues in the condensed consolidated statements of operations at the time revenue is recognized. The Company accrues warranty costs based on estimates of future warranty-related replacement, repairs or rework of products. In estimating its future warranty obligations, the Company considers various relevant factors, including the historical frequency and volume of claims, and the cost to replace or repair products under warranty.

Intangible Assets

9 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

3. Intangible Assets

The Company’s amortizable purchased intangible assets resulting from its 2010 acquisition of Enfora, Inc. (“Enfora”) are composed of (in thousands):


	September 30, 2014
	Gross		Accumulated Amortization			Accumulated Impairment			Net

Developed technologies	$	26,000	$	(6,371	)	$	(19,547	)	$	82
Trade name		12,800		(3,053	)		(8,582	)		1,165
Other		3,720		(2,000	)		(1,620	)		100

Total amortizable purchased intangible assets	$	42,520	$	(11,424	)	$	(29,749	)	$	1,347


	December 31, 2013
	Gross		Accumulated Amortization			Accumulated Impairment			Net

Developed technologies	$	26,000	$	(6,120	)	$	(19,547	)	$	333
Trade name		12,800		(2,665	)		(8,582	)		1,553
Other		3,720		(1,967	)		(1,620	)		133

Total amortizable purchased intangible assets	$	42,520	$	(10,752	)	$	(29,749	)	$	2,019

The following table presents details of the amortization of purchased intangible assets included in the cost of net revenues and general and administrative expense categories (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2014		2013		2014		2013

Cost of net revenues	$	83	$	83	$	250	$	250
General and administrative expenses		141		141		421		422


Total amortization expense	$	224	$	224	$	671	$	672

The following table represents details of the amortization of existing purchased intangible assets that is currently estimated to be expensed in the remainder of 2014 and thereafter (in thousands):


Fiscal year:	Amount
2014 (remaining 3 months)	$	224
2015		562
2016		561


Total	$	1,347

Additionally, at September 30, 2014 and December 31, 2013, the Company had $180,000 and $112,000, respectively, of acquired software licenses, net of accumulated amortization of $2.3 million and $2.2 million, respectively. The acquired software licenses represent rights to use certain software necessary for commercial sale of the Company’s products.

Derivative Financial Instruments	9 Months Ended
Derivative Financial Instruments	Sep. 30, 2014
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Financial Instruments	4. Derivative Financial Instruments The Company evaluates stock options, stock warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivative financial instruments to be separately accounted for under the relevant sections of FASB Accounting Standards Codification 815-40, Derivative Instruments and Hedging: Contracts in Entity’s Own Equity (“ASC 815”). The result of this accounting treatment could be that the fair value of a financial instrument is classified as a derivative financial instrument and is marked-to-market at each balance sheet date and recorded as an asset or liability. In the event that the fair value is recorded as an asset or liability, the change in fair value is recorded in the statement of operations as other income or other expense. Upon conversion, exercise or expiration of a derivative financial instrument, the instrument is marked to fair value and then that fair value is reclassified to equity. Certain of the Company’s outstanding warrants are treated as derivative liabilities for accounting purposes under ASC 815 due to the current insufficient authorized shares to settle these outstanding contracts. These common stock purchase warrants do not trade in an active securities market. The Company estimates the fair value of these warrant liabilities using a Monte Carlo simulation option pricing model (see Note 9).

- Definition

The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts.

+ References

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+ Details

Fair Value Measurement of Assets and Liabilities

9 Months Ended

Sep. 30, 2014

Fair Value Disclosures [Abstract]

Fair Value Measurement of Assets and Liabilities

5. Fair Value Measurement of Assets and Liabilities

The Company’s fair value measurements relate to its cash equivalents, marketable debt securities, marketable equity securities, and warrant liability, which are classified pursuant to authoritative guidance for fair value measurements. The Company places its cash equivalents and marketable debt securities in instruments that meet credit quality standards, as specified in its investment policy guidelines. These guidelines also limit the amount of credit exposure to any one issue, issuer or type of instrument.

The Company’s financial instruments consist principally of cash and cash equivalents, and short-term and long-term marketable debt securities. The Company’s cash and cash equivalents consist of its investments in money market securities and treasury bills. The Company’s marketable debt securities consist primarily of government agency securities, municipal bonds, time deposits and investment-grade corporate bonds.

Assets and liabilities measured at fair value are categorized based on whether or not the inputs are observable in the market and the degree to which the inputs are observable. The categorization of financial instruments within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is prioritized into three levels (with Level 3 being the lowest) defined as follows:

Level 1: Pricing inputs are based on quoted market prices for identical assets or liabilities in active markets (e.g., NYSE). Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2: Pricing inputs include benchmark yields, trade data, reported trades and broker dealer quotes, two-sided markets and industry & economic events, yield to maturity, Municipal Securities Rule Making Board reported trades and vendor trading platform data. Level 2 includes those financial instruments that are valued using various pricing services and broker pricing information including Electronic Communication Networks and broker feeds.

Level 3: Pricing inputs include significant inputs that are generally less observable from objective sources, including the Company’s own assumptions.

At September 30, 2014, the Company included its warrant liability in the Level 3 category. The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy.

The following table summarizes the Company’s financial instruments measured at fair value on a recurring basis in accordance with the authoritative guidance for fair value measurements as of September 30, 2014 (in thousands):


Description	September 30, 2014		Level 1		Level 2		Level 3

Assets:
Cash equivalents
US Treasury securities	$	1	$	0	$	1	$	0

Total cash equivalents		1		0		1		0

Short-term marketable securities:
Available-for-sale:
Government agency securities		0		0		0		0
Municipal bonds		980		0		980		0
Certificates of deposit		4,117		0		4,117		0
Corporate debentures / bonds		0		0		0		0

Total short-term marketable securities		5,097		0		5,097		0


Long-term marketable securities:
Available-for-sale:
Government agency securities		0		0		0		0
Municipal bonds		261		0		261		0
Certificates of deposit		0		0		0		0
Corporate debentures / bonds		0		0		0		0

Total long-term marketable securities		261		0		261		0

Total financial assets	$	5,359	$	0	$	5,359	$	0

Liabilities:
Warrant liability	$	9,727	$	0	$	0	$	9,727


Description	December 31, 2013		Level 1		Level 2		Level 3

Assets:
Cash equivalents
US Treasury securities	$	487	$	0	$	487	$	0

Total cash equivalents		487		0		487		0

Short-term marketable securities:
Available-for-sale:
Government agency securities		2,351		0		2,351		0
Municipal bonds		2,829		0		2,829		0
Certificates of deposit		3,360		0		3,360		0
Corporate debentures / bonds		10,638		0		10,638		0

Total short-term marketable securities		19,178		0		19,178		0

Long-term marketable securities:
Available-for-sale:
Municipal bonds		0		0		0		0
Certificates of deposit		1,300		0		1,300		0
Corporate debentures / bonds		2,143		0		2,143		0

Total long-term marketable securities		3,443		0		3,443		0

Total financial assets	$	23,108	$	0	$	23,108	$	0

Share-Based Compensation

9 Months Ended

Sep. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-Based Compensation

6. Share-Based Compensation

The Company included the following amounts for share-based compensation expense in the accompanying unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2014 and 2013 (in thousands):


	Three Months Ended September 30						Nine Months Ended September 30
	2014			2013			2014			2013
Cost of net revenues (1)	$	12		$	(7	)	$	(7	)	$	49
Research and development		190			329			448			908
Sales and marketing		(21	)		215			200			618
General and administrative		196			422			975			1,273

Totals	$	377		$	959		$	1,616		$	2,848

(1)	Negative expense resulted from a change in the estimated forfeiture rate during the first quarters of 2013 and 2014.

See Note 13 for a discussion of the $1.3 million share-based compensation expense included in the restructuring charges for the nine months ended September 30, 2014. This amount was related to the departure of the Company’s former Chief Executive Officer, Peter Leparulo, and the vesting of all of Mr. Leparulo’s restricted stock units and options immediately upon his departure in accordance with the terms of his employment agreement.

Employee Stock Purchase Plan	9 Months Ended
Employee Stock Purchase Plan	Sep. 30, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Employee Stock Purchase Plan	7. Employee Stock Purchase Plan The Company’s 2000 Employee Stock Purchase Plan (the “ESPP”) permits eligible employees of the Company to purchase newly issued shares of common stock, at a price equal to 85% of the lower of the fair market value on (i) the first day of the offering period or (ii) the last day of each six-month purchase period, through payroll deductions of up to 10% of their annual cash compensation. During the fourth quarter of 2012, the Company announced the termination of the ESPP due to a lack of available shares. The Company reinstated the ESPP program effective as of August 16, 2014. The reinstated ESPP authorizes the Company to issue 1,500,132 shares of common stock for purchase by eligible employees. The total fair value of ESPP awards recognized as expense during each of the three and nine months ended September 31, 2014 was $26,218.

Segment Information and Concentrations of Risk

9 Months Ended

Sep. 30, 2014

Segment Reporting [Abstract]

Segment Information and Concentrations of Risk

8. Segment Information and Concentrations of Risk

Segment Information

The Company reports segment information based on the “management” approach. The management approach designates the internal reporting used by senior management for making decisions and assessing performance as the source of the Company’s reportable segments.

The Company operates in the wireless broadband technology industry and senior management makes decisions about allocating resources based on the following reportable segments:

•

The Mobile Computing Products segment includes the Company’s MiFi products, USB and PC-card modems and embedded modules that enable data transmission and services via cellular wireless networks.

•

The Machine-to-Machine (“M2M”) Products and Solutions segment was established as a result of the Company’s acquisition of Enfora in 2010. It includes the Company’s intelligent asset-management solutions utilizing cellular wireless technology, M2M communication devices, and embedded modules that enable M2M data transmission and services via cellular wireless networks.

Segment revenues and segment operating loss represent the primary financial measures used by senior management to assess performance and include the net revenues, cost of net revenues, sales and other operating expenses for which management is held accountable. Segment expenses include sales and marketing, research and development, administration, and amortization expenses that are directly related to individual segments. Segment loss also includes acquisition-related costs, purchase price amortization, restructuring, impairment and integration costs. The table below presents net revenues from external customers, operating loss and identifiable assets for the Company’s reportable segments (in thousands):


	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
Net revenues by reportable segment:
Mobile Computing Products	$	34,788		$	84,067		$	98,483		$	240,510
M2M Products and Solutions		9,542			8,606			31,401			29,208

Total	$	44,330		$	92,673		$	129,884		$	269,718


Operating loss by reportable segment:
Mobile Computing Products	$	(1,704	)	$	(953	)	$	(20,076	)	$	(9,801	)
M2M Products and Solutions		(2,192	)		(3,911	)		(10,145	)		(11,992	)

Total	$	(3,896	)	$	(4,864	)	$	(30,221	)	$	(21,793	)


	September 30,		December 31,
	2014		2013
Identifiable assets by reportable segment:
Mobile Computing Products	$	80,551	$	96,516
M2M Products and Solutions		12,494		14,949

Total	$	93,045	$	111,465

The Company has operations in the United States, Canada, Europe, Latin America and Asia. The following table details the geographic concentration of the Company’s assets in the United States, Canada, Europe, Latin America and Asia (in thousands):


	September 30,		December 31,
	2014		2013
United States	$	91,241	$	108,932
Canada		951		808
Europe, Latin America and Asia		853		1,725

	$	93,045	$	111,465

The following table details the concentration of the Company’s net revenues by geographic region:


	Three months ended						Nine months ended
	September 30,						September 30,
	2014			2013			2014			2013
United States and Canada		90	%		97	%		90	%		96	%
Latin America		1			1			1			1
Europe, Middle East and Africa		7			2			8			3
Asia and Australia		2			0			1			0

		100	%		100	%		100	%		100	%

During the third quarter of 2013, the Company began implementing restructuring initiatives designed to refine its business operations, reduce expenses to better correspond to its decreased revenue and capitalize on synergies in its target markets with the goal of driving long-term profitability.

In connection with the restructuring plan, the Company made organizational changes across some of its Mobile Computing and M2M business operations to consolidate its research and development resources and consolidate global manufacturing activities. The Company also closed development sites to drive efficiencies, enhance margins and improve capital efficiency.

Historically, the Company’s business units have their own management teams and offer different products and services. The business units have been aggregated into two reportable business segments based upon the nature of the products or services produced, the type of customer for the products, the similarity of economic characteristics and the manner in which management reviews results, among other considerations. The Company is currently reevaluating its reportable segments composition.

Concentrations of Risk

Substantially all of the Company’s net revenues are derived from sales of wireless access products. Any significant decline in market acceptance of the Company’s or its customers’ products or in the financial condition of the Company’s customers would have an adverse effect on the Company’s results of operations and financial condition.

A significant portion of the Company’s net revenues are derived from a small number of customers. For the three months ended September 30, 2014, sales to the Company’s two largest customers accounted for 54% and 12% of net revenues, respectively. In the same period in 2013, sales to its largest customer accounted for 59% of net revenues. For the nine months ended September 30, 2014, sales to the Company’s largest customer accounted for 44% of net revenues. In the same period in 2013, sales to its largest customer accounted for 61% of net revenues. The Company outsources its manufacturing to several third-party contract manufacturers. If one or more of these manufacturers were to experience delays, including delays caused by component shortages, disruptions, capacity constraints or quality control problems in manufacturing operations, product shipments to the Company’s customers could be delayed or its customers could consequently elect to cancel their underlying product purchase orders, which would negatively impact the Company’s revenues and results of operations.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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+ Details

Securities Purchase Agreement

9 Months Ended

Sep. 30, 2014

Text Block [Abstract]

Securities Purchase Agreement

9. Securities Purchase Agreement

On September 3, 2014, the Company entered into a Purchase Agreement (the “Purchase Agreement”) with HC2 Holdings 2, Inc., a Delaware corporation (the “Investor”), pursuant to which, on September 8, 2014, the Company sold to the Investor (i) 7,363,334 shares of the Company’s common stock, par value $0.001 per share, (ii) a warrant to purchase 4,117,647 shares of common stock at an exercise price of $2.26 per share (the “Warrant”) and (iii) 87,196 shares of the Company’s Series C Convertible Preferred Stock, par value $0.001 per share (the “Series C Preferred Stock”), all at a purchase price of (a) $1.75 per share of common stock plus, in each case, the related Warrant and (b) $17.50 per share of Series C Preferred Stock, for aggregate gross proceeds of approximately $14.4 million (collectively, the “Financing”).

Certain terms of the Warrant and the Series C Preferred Stock will be dependent upon the approval by the Company’s stockholders of (i) an increase in the total number of authorized shares of common stock to 100,000,000 shares and (ii) the issuance and sale of the securities pursuant to the Purchase Agreement (including the issuance of all shares of common stock issuable upon the full conversion of the Series C Preferred Stock issued pursuant to the Purchase Agreement and the full exercise of the Warrant) and any change of control that may be deemed to occur as a result of such issuance and sale pursuant to the applicable rules of The NASDAQ Stock Market LLC (together, the “Stockholder Approval”).

In connection with the issuance of 7,363,334 shares of common stock to the Investor, the Company unreserved 1,651,455 shares of common stock previously approved for issuance pursuant to the Company’s 2009 Omnibus Incentive Compensation Plan and 1,300,000 shares of common stock previously approved for issuance pursuant to the Company’s 2000 ESPP. Accordingly, these shares will not be available for grants under the respective plans until such time as the Company’s Stockholders approve an increase in the total number of authorized shares of common stock.

Warrant

In connection with the above transaction the Company issued a Warrant to purchase 4,117,647 shares of common stock at an exercise price of $2.26 per share to the Investor. Pursuant to the terms of the Warrant, the Warrant will generally only be exercisable on a cash basis. However, the Warrant may be exercisable on a cashless basis if and only if a registration statement relating to the issuance of the shares underlying the Warrant is not then effective or an exemption from registration is not available. Prior to the receipt of the Stockholder Approval, the holders may not exercise any portion of the Warrant to the extent that, after giving effect to such exercise, the number of shares of common stock beneficially owned by such holder and its affiliates would exceed 19.999% of the common stock outstanding at the time of such exercise. Subject to the foregoing limitations, the Warrant will be exercisable into shares of common stock during the period commencing on March 8, 2015 and ending on September 8, 2019, the expiration date of the Warrant. The Warrant may be exercised by surrendering to the Company the warrant certificate evidencing the Warrant to be exercised with the accompanying exercise notice, appropriately completed, duly signed and delivered, together with cash payment of the exercise price, if applicable.

The exercise price and the number of shares of common stock issuable upon exercise of the Warrant are subject to adjustment upon certain corporate events, including certain combinations, recapitalizations, reorganizations, reclassifications, stock dividends and stock splits. In the event of an extraordinary transaction, as described in the Warrant and generally including any merger with or into another entity, sale of all or substantially all of the Company’s assets, tender offer or exchange offer, or reclassification of the common stock, each Warrant will automatically be converted into the right to receive, for each share of common stock that would have been issuable upon exercise of such Warrant immediately prior to such transaction, the same kind and amount of securities, cash or property as the holder would have been entitled to receive if the holder had been the holder of common stock immediately prior to the occurrence of such transaction. No fractional shares will be issued upon exercise of the Warrant. The Warrant does not confer upon its holder any voting or other rights as a stockholder of the Company.

Due to insufficient authorized shares to satisfy the exercise of the instrument in full at the time of issuance, the Company has determined that the instrument should be treated as a derivative instrument. Liability classification is required because share settlement is not within the control of the Company and the Warrant is not considered to be “indexed to the company’s own stock” and therefore does not qualify for the exemptions provided by ASC 815.

Because the Warrant has no comparable market data to determine fair value, the Company hired an independent valuation firm to assist with the valuation of the Warrant at the measurement date and as of September 30, 2014. The primary factors used to determine the fair value include: (i) the fair value of the Company’s common stock; (ii) the volatility of the Company’s common stock; (iii) the risk free interest rate; (iv) the estimated likelihood and timing of exercise; and (v) the estimated likelihood and timing of a future financing arrangement. Increases in the market value of the Company’s common stock and volatility, which have the most impact on the fair value of the Warrant, would cause the fair value of the Warrant to change. Because of the significant unobservable inputs used to calculate fair value the Company has classified the Warrant as a Level 3 measurement. The Warrant is measured at fair value on a recurring basis. Unrealized gains and losses on items measured at fair value are recognized in earnings as other income/(expense). The Company incurred an expense of $4.8 million for the three months ended September 30, 2014 related to the Warrant primarily as a result of an increase in the market value of the Company’s common stock.

The following table shows the change to the fair value of the Warrant during the three months ended September 30, 2014 (in thousands):


Warrant Derivative Liability	Level 3
Beginning balance at September 8, 2014	$	4,939
Change in fair value		4,788

Ending balance at September 30, 2014	$	9,727

Contingently Redeemable Convertible Series C Preferred Stock

In connection with the Financing the Company issued 87,196 shares of Series C Preferred Stock at $17.50 per share, initially convertible, subject to adjustments, into 871,960 shares of common stock.

Terms of Conversion

Pursuant to the Certificate of Designations of Series C Convertible Preferred Stock filed by the Company with the Secretary of State of the State of Delaware on September 8, 2014 (the “Certificate of Designations”), upon receipt of the Stockholder Approval, each share, or fraction of a share, of Series C Preferred Stock then outstanding will automatically convert into the number of shares of common stock that is obtained by multiplying the number of such outstanding shares of Series C Preferred Stock by the conversion rate then in effect. Generally, each share of Series C Preferred Stock is initially convertible into ten shares of common stock, subject to the adjustments described below. Notwithstanding the foregoing, the Series C Preferred Stock is not convertible into common stock prior to obtaining the Stockholder Approval.

The conversion rate and conversion price applicable to the Series C Preferred Stock are subject to the following adjustments: (i) the conversion price may be reduced by the Company to any amount and for any period of time deemed appropriate by the Board, (ii) if the Company, at any time while Series C Preferred Stock is outstanding, subdivides (by any stock split, stock dividend, recapitalization, reorganization, scheme, arrangement or otherwise) one or more classes of its outstanding shares of common stock into a greater number of shares (a “Subdivision”), the conversion price in effect immediately prior to such Subdivision will be proportionately reduced and the number of shares to be issued upon conversion of the Series C Preferred Stock will be proportionately increased, and (iii) if the Company, at any time on or after September 8, 2014, combines (by any stock split, stock dividend, recapitalization, reorganization, scheme, arrangement or otherwise) one or more classes of its outstanding shares of common stock into a smaller number of shares (a “Combination”), the conversion price in effect immediately prior to such Combination will be proportionately increased and the number of shares to be issued upon conversion of the Series C Preferred Stock will be proportionately decreased.

Additionally, in the event of a Fundamental Transaction (as defined in the Certificate of Designations) and generally including any merger with or into another entity, sale of all or substantially all of the Company’s assets, tender offer or exchange offer, and certain reclassifications of the common stock, each holder of Series C Preferred Stock will be paid in cash any accrued and unpaid dividends on such holder’s shares of Series C Preferred Stock and each share of Series C Preferred Stock will automatically be converted into the right to receive, for each share of common stock that would have been issuable upon such conversion immediately prior to such transaction, the same kind and amount of securities, cash or property that the holder would have been entitled to receive if the holder had been the holder of common stock immediately prior to the occurrence of such transaction. If the holders of common stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then each holder of Series C Preferred Stock shall be given the same choice as to the consideration it receives upon automatic conversion of such holder’s Series C Preferred Stock.

No fractional shares of common stock will be issued upon conversion of the Series C Preferred Stock.

Dividend Rights

From and after December 31, 2014, each share of Series C Preferred Stock that remains outstanding will accrue dividends, in preference and priority to the holders of all other classes or series of stock of the Company, at a rate of 12.5% per annum (the “Series C Preferred Dividends”), which shall, at the Company’s option, either (i) be payable in cash quarterly in arrears or (ii) accrue until such time as the Company pays all such amounts in cash in full. The Series C Preferred Dividends are cumulative and accrue whether or not declared and whether or not there are any profits, surplus or other funds or assets of the Company legally available therefor.

In addition, each holder of Series C Preferred Stock will be entitled to receive any dividend declared and paid by the Company to holders of its common stock (excluding dividends of its common stock and distributions made in connection with a Subdivision or Combination), as if such holder’s Series C Preferred Stock had been converted into common stock on the record date for such dividend.

Liquidation Rights

Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, after the satisfaction in full of the debts of the Company, the payment of any accrued but unpaid Series C Preferred Dividends and the payment of any liquidation preference owed to the holders of shares of capital stock of the Company ranking senior to the common stock and Series C Preferred Stock, the holders of Series C Preferred Stock will participate (on an as-converted basis) pari passu with the holders of the common stock in the distribution of the net assets of the Company.

Redemption

From and after September 8, 2015, the Company may exercise its right to redeem, in whole or in part, the Series C Preferred Stock at the redemption price then in effect, plus an amount equal to any accrued and unpaid dividends thereon through, but excluding, the date of redemption. The Series C Preferred Stock contains a two-year “make-whole” provision such that, if the Series C Preferred Stock is redeemed on or before September 8, 2016, the holder thereof will be entitled to receive the amount of Series C Preferred Dividends that would have accrued and payable from the date of redemption through and including September 8, 2016. The Company may settle the “make-whole” payment in cash or in shares of common stock, at the Company’s election. Any redemption will be made on a pro rata basis among the holders of the Series C Preferred Stock in proportion to the number of shares of Series C Preferred Stock then held by them.

Voting Rights; Related Rights

Except as required by law and as described in the following sentence, the Series C Preferred Stock does not confer upon its holders any voting rights or rights to otherwise participate in any action taken by the Company or its stockholders or to receive notice of any meeting of stockholders. However, so long as any Series C Preferred Stock remains outstanding, the Company is not permitted, without the affirmative consent of holders of at least a majority of the Series C Preferred Stock then outstanding, either in writing or at a meeting, (i) to authorize or create, or increase the authorized or issued amount of, any class or series of stock ranking senior to or on parity with the Series C Preferred Stock with respect to the payment of dividends, or to reclassify any authorized shares of the Company into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares, or (ii) to amend, alter or repeal the provisions of the Amended and Restated Certificate of Incorporation of the Company, whether by merger, consolidation or otherwise, so as to adversely affect any right, preference, privilege or power of, or restriction provided for the benefit of, the Series C Preferred Stock; provided, however, that the foregoing voting provisions do not apply if, at or prior to the consummation of the action with respect to which such vote would otherwise be required, all outstanding Series C Preferred Stock will be converted and all accrued but unpaid Series C Preferred Dividends will be paid (or sufficient funds will be deposited in trust to effect such payment).

The Series C Preferred Stock carries no preemptive rights to subscribe to any issue of the same or other capital stock of the Company.

The Company analyzed the embedded conversion option of the Series C Preferred Stock for derivative accounting consideration and determined that the conversion option should be classified as equity since the embedded conversion option is clearly and closely related to the Series C Preferred Stock.

Conversion options that are not bifurcated as a derivative must be evaluated to determine whether they are considered a beneficial conversion option at inception or in the future. Guidance generally requires embedded beneficial conversion features (“BCF”) to be valued at intrinsic value and allocated to additional paid-in-capital. Under ASC 470-20-25-20, changes to the conversion terms that would be triggered by future events not controlled by the issuer shall be accounted for as contingent conversion options, and the intrinsic value of such conversion options shall not be recognized until and unless the triggering event occurs. The term “recognized” is used to mean that the calculated intrinsic value is recorded in equity with a corresponding discount to the convertible instrument. Contingent BCFs (or contingent adjustments to BCFs) are measured at the commitment date but are not recognized until the contingency is resolved. As of the commitment date the Company we computed but did not recognize a beneficial conversion feature of $445,000 on the Series C Preferred Stock.

Further, because the event that triggers redemption of the Series C Preferred Stock, receipt of Stockholder Approval, is not solely within the Company’s control, the amount allocated to the convertible preferred stock has been classified as mezzanine equity.

Earnings Per Share

9 Months Ended

Sep. 30, 2014

Earnings Per Share [Abstract]

Earnings Per Share

10. Earnings Per Share

Basic earnings per share (“EPS”) excludes dilution and is computed by dividing net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock using the treasury stock method. Potentially dilutive securities (consisting of options, restricted stock units (“RSUs”) and employee stock purchase plan withholdings calculated using the treasury stock method) are excluded from the diluted EPS computation in loss periods and when the applicable exercise price is greater than the market price on the period end date as their effect would be anti-dilutive.

For the three and nine months ended September 30, 2014, basic and diluted weighted-average common shares outstanding were 38,167,211 and 35,567,715, respectively. During these same periods, weighted-average options, RSUs and ESPP shares to acquire a total of 4,761,066 and 5,313,009 shares of common stock, respectively, were outstanding but not included in the computation of diluted EPS as their effect was anti-dilutive.

For the three and nine months ended September 30, 2013, basic and diluted weighted-average common shares outstanding were 34,070,211 and 33,902,038, respectively. During these same periods, weighted-average options and RSUs to acquire a total of 5,668,752 and 5,885,100 shares of common stock, respectively, were outstanding but not included in the computation of diluted earnings per share as their effect was anti-dilutive.


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2014			2013			2014			2013
Numerator
Net loss:	$	(8,832	)	$	(5,093	)	$	(35,228	)	$	(22,107	)

Denominator
Weighted-average common shares outstanding		38,167			34,070			35,568			33,902

Basic and diluted net loss per share	$	(0.23	)	$	(0.15	)	$	(0.99	)	$	(0.65	)


	September 30
	2014
Securities not included in dilutive loss per share relating to:
Common stock warrants outstanding		4,118
Series C Preferred Stock		872
Stock Options		2,965
Employee Stock Purchase Plan		1,500
Restricted Stock Units		1,854

		11,309

Commitments and Contingencies	9 Months Ended
Commitments and Contingencies	Sep. 30, 2014
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	11. Commitments and Contingencies Legal Matters The Company is, from time to time, party to various legal proceedings arising in the ordinary course of business. For example, the Company is currently named as a defendant or co-defendant in some patent infringement lawsuits in the U.S. and is indirectly participating in other U.S. patent infringement actions pursuant to its contractual indemnification obligations to certain customers. Based on an evaluation of these matters and discussions with the Company’s intellectual property litigation counsel, the Company believes that liabilities arising from or sums paid in settlement of these existing matters would not have a material adverse effect on its consolidated results of operations or financial condition. On September 15, 2008 and September 18, 2008, two putative securities class action lawsuits were filed in the U.S. District Court for the Southern District of California (the “Court”) on behalf of alleged stockholders of the Company. On December 11, 2008, these lawsuits were consolidated into a single action and in May 2010, the consolidated lawsuits were captioned the case In re Novatel Wireless Securities Litigation (the “Litigation”). The Litigation was filed on behalf of persons who purchased the Company’s common stock between February 27, 2007 and September 15, 2008. As previously disclosed, on December 6, 2013, to avoid the costs, disruption and distraction of further litigation, legal counsel for the defendants entered into a binding Memorandum of Understanding. On June 23, 2014, the Court entered its judgment approving a final settlement agreement with respect to the Litigation. The settlement agreement does not admit any liability and the Company and the individual defendants continue to deny any and all liability. Under the terms of the settlement agreement, the plaintiff class has agreed to settle all claims asserted in the Litigation and grant the defendants and released parties a full and complete release in exchange for (i) a cash payment of $6.0 million to the plaintiff’s class, approximately $1.7 million of which is to be funded by the Company’s insurers, (ii) the issuance of unrestricted and freely tradable shares of the Company’s stock with an aggregate value of $5.0 million and (iii) the issuance of a $5.0 million secured promissory note, which such note shall have a 30-month maturity, carry interest at 5% per annum, payable quarterly, and be secured by the accounts receivable of the Company. On July 1, 2014, the Company and the individual defendants filed a motion to amend the judgment entered on June 23, 2014, specifically requesting the Court to amend the effective date of such judgment to June 20, 2014 – the date the court held the final approval hearing. The Court granted this motion on July 8, 2014, and the judgment date was deemed entered on June 20, 2014. Based on a judgment date of June 20, 2014, the Company believes that it will be relieved from an additional cash payment of approximately $725,000, which would have been triggered, pursuant to the terms of the stipulation of settlement, if the date of the Court’s entry of judgment had remained June 23, 2014 (based on the then-current trading price of the Company’s common stock, which was below a certain threshold price established by the stipulation of settlement). On August 1, 2014, the Plaintiffs filed a motion with the Court claiming that since the Company’s stock price traded intraday below the aforementioned threshold price, that the $725,000 was still due and payable. The Company is contesting the plaintiffs’ motion and has not accrued the $725,000 asserted claim in the accompanying consolidated financial statements. A hearing date is set for November 14, 2014 to adjudicate this matter. On July 8, 2014, the Company funded the cash portion of the settlement with $4.3 million of Company cash and $1.7 million previously funded into escrow by the Company’s insurers. On July 17, 2014, the Company issued 2,407,318 unrestricted shares of the Company’s common stock to the class members in satisfaction of the $5.0 million stock payment. The Company also issued a $5.0 million secured promissory note on July 8, 2014, which remains accrued as of September 30, 2014 in non-current liabilities. Indemnification In the normal course of business, the Company periodically enters into agreements that require the Company to indemnify and defend its customers for, among other things, claims alleging that the Company’s products infringe third-party patents or other intellectual property rights. The Company’s maximum exposure under these indemnification provisions cannot be estimated but the Company does not believe that there are any matters individually or collectively that would have a material adverse effect on its financial condition, results of operation or cash flows.

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2014
Income Tax Disclosure [Abstract]
Income Taxes	12. Income Taxes The Company recognizes federal, state and foreign current tax liabilities or assets based on its estimate of taxes payable to or refundable by tax authorities in the current fiscal year. The Company also recognizes federal, state and foreign deferred tax liabilities or assets based on the Company’s estimate of future tax effects attributable to temporary differences and carryforwards. The Company records a valuation allowance to reduce any deferred tax assets by the amount of any tax benefits that, based on available evidence and judgment, are not expected to be realized. The Company assesses whether a valuation allowance should be recorded against its deferred tax assets based on the consideration of all available evidence, using a “more-likely-than-not” realization standard. The four sources of taxable income that must be considered in determining whether deferred tax assets will be realized are: (i) future reversals of existing taxable temporary differences (i.e., the offset of gross deferred tax assets against gross deferred tax liabilities); (ii) taxable income in prior carryback years, if carryback is permitted under the applicable tax law; (iii) tax planning strategies; and (iv) future taxable income exclusive of reversing temporary differences and carryforwards. In assessing whether a valuation allowance is required, significant weight is to be given to evidence that can be objectively verified. A significant factor in the Company’s assessment is that the Company is in a three-year historical cumulative loss position. This fact, combined with uncertain near-term market and economic conditions, reduced the Company’s ability to rely on projections of future taxable income in assessing the realizability of its deferred tax assets. After a review of the four sources of taxable income as of September 30, 2014 (as described above), the Company recognized increases in the valuation allowance primarily related to its U.S.-based deferred tax amounts, resulting from carryforward net operating losses generated during the three and nine months ended September 30, 2014. These deferred tax benefits, offset by a corresponding charge to income tax expense related to an increase in the valuation allowance of $3.2 million and $12.3 million for the three and nine months ended September 30, 2014, respectively, resulted in an insignificant effective income tax rate. The Company’s valuation allowance was $91.8 million on net deferred tax assets of $91.9 million at September 30, 2014. The net unreserved portion of the Company’s remaining deferred tax assets at September 30, 2014 primarily related to research and development tax credits associated with the Company’s Canadian subsidiary. For the three and nine months ended September 30, 2014, the Company recorded an income tax expense, including discrete items, of $24,000 and $73,000, respectively. This amount varies from the income tax expense that would be computed at the U.S. statutory rate resulting from its operating loss during the period primarily due to the aforementioned offsetting increase in the Company’s deferred tax assets valuation allowance. Pursuant to Internal Revenue Code Sections 382 and 383, annual use of the Company’s net operating loss and research and development credit carryforwards may be limited in the event a cumulative change in ownership of more than 50% occurs within a three-year period. The Company obtained additional funding during 2014 and it is possible that, as a result of this additional funding, the Company may have experienced a change in ownership event. The Company is in the process of updating its Section 382 analysis and expects to have this analysis completed within the next six months. The Company follows the accounting guidance related to financial statement recognition, measurement and disclosure of uncertain tax positions. The Company recognizes the impact of an uncertain income tax position on an income tax return at the largest amount that is “more-likely-than-not” to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. As of September 30, 2014 and December 31, 2013, the total liability for unrecognized tax benefits was $62,000, and is included in other long-term liabilities. For the three and nine months ended September 30, 2014, the Company included $0 of interest benefit related to uncertain tax positions in its condensed consolidated statements of operations. In the fourth quarter of 2014, the Company expects to release $62,000 of its liability for unrecognized tax benefits due to the expiration of the statute of limitations applicable to the 2009 taxable year. The Company and its subsidiaries file U.S., state, and foreign income tax returns in jurisdictions with various statutes of limitations. The Company is also subject to various Federal income tax examinations for the 2003 through 2013 calendar years due to the availability of net operating loss carryforwards. The Company believes appropriate provisions for all outstanding issues have been made for all jurisdictions and all open years. However, because audit outcomes and the timing of audit settlements are subject to significant uncertainty, the Company’s current estimate of the total amounts of unrecognized tax benefits could increase or decrease for all open years.

Restructuring

9 Months Ended

Sep. 30, 2014

Restructuring and Related Activities [Abstract]

Restructuring

13. Restructuring

In September 2013, the Company commenced certain restructuring initiatives (the “2013 Initiatives”) including the closure of the Company’s development site in Calgary, Canada, and the consolidation of certain supply chain management activities. During February and March 2014, the Company commenced additional reduction in force initiatives resulting in headcount reductions of 41 employees and 21 employees, respectively, and during June 2014 a further headcount reduction of five employees at its Calgary, Canada site.

During the three months ended September 30, 2014, the Company recorded a reduction in restructuring charges related to the 2013 Initiatives of approximately $87,000, which consisted of savings in facility exit related costs resulting from a reevaluation of its expected sublet dates and rates as further described below. During the nine months ended September 30, 2014, the Company recorded restructuring charges related to the 2013 Initiatives of $2.6 million, which consisted of $1.7 million in employee severance costs and $917,000 in facility exit related costs related to ongoing assessment of estimates of the timing and amounts of sublease income.

Total restructuring charges incurred to date relating to the 2013 Initiatives discussed above, are approximately $5.9 million, including restructuring charges recorded during the year ended December 31, 2013 of $3.3 million.

The Company accounts for facility exit costs in accordance with FASB ASC Topic 420, Exit or Disposal Cost Obligations, which requires that a liability for such costs be recognized and measured initially at fair value on the cease-use date based on remaining lease rentals, adjusted for the effects of any prepaid or deferred items recognized, reduced by the estimated sublease rentals that could be reasonably obtained even if it is not the intent to sublease.

The Company is required to estimate future sublease income and future net operating expenses of the facilities, among other expenses. The most significant of these estimates relate to the timing and extent of future sublease income which reduce lease obligations, and the probability that such sublease income will be realized. The Company based estimates of sublease income, in part, on information from third party real estate experts, current market conditions and rental rates, an assessment of the time period over which reasonable estimates could be made, and the location of the respective facility, among other factors. Further adjustments to the facility exit liability accrual will be required in future periods if actual exit costs or sublease income differ from amounts currently expected. Exit costs the Company records under these provisions are neither associated with, nor do they benefit, continuing activities.

In June 2014, the Company commenced certain restructuring initiatives relating to the reorganization of executive level management (the “2014 Initiatives”), which included the replacement of then Chief Executive Officer, Peter Leparulo, with current Chief Executive Officer, Alex Mashinsky. In connection with the 2014 Initiatives, during the three months ended September 30, 2014, the Company recorded restructuring charges of approximately $1.1 million, related primarily to the departure of former executive officers, including Mr. Leparulo. During the nine months ended September 30, 2014, the Company recorded restructuring charges of approximately $4.8 million, including approximately $1.3 million related to the accelerated vesting of all of Mr. Leparulo’s restricted stock units and options which vested immediately upon his departure.

The following table sets forth activity in the restructuring liability for the nine months ended September 30, 2014 (in thousands):


	2013 Initiatives						2014 Initiatives
	Employee Severance Costs			Facility Exit Related Costs			Employment Contract Costs			Share-based Compensation Costs			Total

Balance at December 31, 2013	$	0		$	881		$	0		$	0		$	881
Accruals		1,713			917			3,551			1,298			7,479
Payments		(1,641	)		(739	)		(359	)		0			(2,739	)
Stock-based compensation		0			0			0			(1,298	)		(1,298	)

Balance at September 30, 2014	$	72		$	1,059		$	3,192		$	(0	)	$	4,323

The balance of the restructuring liability at September 30, 2014 consists of $3.9 million in current liabilities and $414,000 in non-current liabilities. The balance of the restructuring liability at September 30, 2014 is anticipated to be fully distributed by the end of the third quarter of 2017, at the expiration of the Company’s facility lease in Canada.

Subsequent Events	9 Months Ended
Subsequent Events	Sep. 30, 2014
Subsequent Events [Abstract]
Subsequent Events	14. Subsequent Events On October 31, 2014, the Company and one of its subsidiaries entered into a Credit and Security Agreement (the “Credit Agreement”) with Wells Fargo Bank, National Association, as lender, to establish a five-year senior secured revolving credit facility in the amount of $25.0 million (the “Revolver”). The amount of borrowings that may be made under the Revolver is based on a borrowing base comprised of a specified percentage of eligible receivables. If, at any time during the term of the Revolver, the amount of borrowings outstanding under the Revolver exceeds the borrowing base then in effect or the maximum revolver amount of $25.0 million, the Borrowers are required to repay such borrowings in an amount sufficient to eliminate such excess. The Revolver includes $3.0 million of availability for letters of credit. The Company may borrow funds under the Revolver from time to time, with interest payable monthly at a base rate determined by using the daily three month LIBOR rate, plus an applicable margin of 2.50% to 3.00% depending on the Company’s liquidity as determined on the last day of each calendar month. The Revolver is secured by a first priority lien on substantially all of the assets of the Company and certain of its subsidiaries, subject to certain exceptions and permitted liens. The Credit Agreement includes customary representations and warranties, as well as customary reporting and financial covenants.

Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2014

Fair Value Disclosures [Abstract]

Basis of Presentation

The information contained herein has been prepared by Novatel Wireless, Inc. (the “Company”) in accordance with the rules of the Securities and Exchange Commission. The information as of September 30, 2014 and the results of the Company’s operations for the three and nine months ended September 30, 2014 and 2013 are unaudited. The condensed consolidated financial statements reflect all adjustments, consisting of only normal recurring accruals, which are, in the opinion of management, necessary for a fair statement of the results of the interim periods presented. These condensed consolidated financial statements and notes hereto should be read in conjunction with the audited financial statements from which they were derived and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013. The accounting policies used in preparing these condensed consolidated financial statements are the same as those described in the Company’s Form 10-K. The results of operations for the interim periods presented are not necessarily indicative of results to be expected for any other interim period or for the year as a whole.

Principles of Consolidation

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent liabilities. Actual results could differ materially from these estimates. Significant estimates include allowance for doubtful accounts receivable, provision for excess and obsolete inventory, valuation of intangible and long-lived assets, fair value of warrant liability, litigation and restructuring related accruals, provision for warranty costs, income taxes, share-based compensation expense and best estimate of selling price in a multiple element arrangement.

New Accounting Pronouncements

New Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (the “FASB”), which are adopted by the Company as of the specified date. Unless otherwise discussed, management believes the impact of recently issued standards, which are not yet effective, will not have a material impact on its consolidated financial statements upon adoption.

In June 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-12, Compensation—Stock Compensation: Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. The standard requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. Entities are required to apply the standard for annual periods and interim periods within those annual periods, beginning after December 15, 2015. Early application is permitted. The Company is currently assessing the impact of this new guidance.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires a reporting entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance in this ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets unless those contracts are within the scope of other standards. This standard will be effective for annual reporting periods beginning after December 15, 2016. The Company is currently assessing the impact of this new guidance.

In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. Under the new guidance, management will be required to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The provisions of this ASU are effective for annual periods beginning after December 15, 2016, and for annual and interim periods thereafter. The Company is currently evaluating the potential changes from this ASU to its future financial reporting and disclosures.

Derivative Financial Instruments

Derivative Financial Instruments

The Company evaluates stock options, stock warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivative financial instruments to be separately accounted for under the relevant sections of FASB Accounting Standards Codification 815-40, Derivative Instruments and Hedging: Contracts in Entity’s Own Equity (“ASC 815”). The result of this accounting treatment could be that the fair value of a financial instrument is classified as a derivative financial instrument and is marked-to-market at each balance sheet date and recorded as an asset or liability. In the event that the fair value is recorded as an asset or liability, the change in fair value is recorded in the statement of operations as other income or other expense. Upon conversion, exercise or expiration of a derivative financial instrument, the instrument is marked to fair value and then that fair value is reclassified to equity.

Certain of the Company’s outstanding warrants are treated as derivative liabilities for accounting purposes under ASC 815 due to the current insufficient authorized shares to settle these outstanding contracts. These common stock purchase warrants do not trade in an active securities market. The Company estimates the fair value of these warrant liabilities using a Monte Carlo simulation option pricing model (see Note 9).

Fair Value of Financial Instruments

Level 3: Pricing inputs include significant inputs that are generally less observable from objective sources, including the Company’s own assumptions.

Segment Information

Segment Information

The Company operates in the wireless broadband technology industry and senior management makes decisions about allocating resources based on the following reportable segments:

•

The Mobile Computing Products segment includes the Company’s MiFi products, USB and PC-card modems and embedded modules that enable data transmission and services via cellular wireless networks.

•

- Definition

Disclosure of accounting policy regarding (1) the principles it follows in consolidating or combining the separate financial statements, including the principles followed in determining the inclusion or exclusion of subsidiaries or other entities in the consolidated or combined financial statements and (2) its treatment of interests (for example, common stock, a partnership interest or other means of exerting influence) in other entities, for example consolidation or use of the equity or cost methods of accounting. The accounting policy may also address the accounting treatment for intercompany accounts and transactions, noncontrolling interest, and the income statement treatment in consolidation for issuances of stock by a subsidiary.

+ References + Details

- Definition

Disclosure of accounting policy for its derivative instruments and hedging activities.

+ References + Details

Balance Sheet Details (Tables)

9 Months Ended

Sep. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Marketable Securities Available-for-Sale

The Company’s portfolio of available-for-sale securities by contractual maturity consists of the following (in thousands):


September 30, 2014	Maturity in Years	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value

Available-for-sale:
Government agency securities	1 or less	$	0	$	0	$	0	$	0
Municipal bonds	1 or less		980		0		0		980
Certificates of deposit	1 or less		4,117		0		0		4,117
Corporate debentures / bonds	1 or less		0		0		0		0

Total short-term marketable securities			5,097		0		0		5,097


Available-for-sale:
Municipal bonds	1 to 2		261		0		0		261
Certificates of deposit	1 to 2		0		0		0		0
Corporate debentures / bonds	1 to 2		0		0		0		0

Total long-term marketable securities			261		0		0		261

		$	5,358	$	0	$	0	$	5,358


December 31, 2013	Maturity in Years	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value

Available-for-sale:
Government agency securities	1 or less	$	2,350	$	1	$	0	$	2,351
Municipal bonds	1 or less		2,828		1		0		2,829
Certificates of deposit	1 or less		3,360		0		0		3,360
Corporate debentures / bonds	1 or less		10,635		3		0		10,638

Total short-term marketable securities			19,173		5		0		19,178

Available-for-sale:
Municipal bonds	1 to 2		0		0		0		0
Certificates of deposit	1 to 2		1,300		0		0		1,300
Corporate debentures / bonds	1 to 2		2,143		0		0		2,143

Total long-term marketable securities			3,443		0		0		3,443

		$	22,616	$	5	$	0	$	22,621

Summary of Inventories

Inventories consist of the following (in thousands):


	September 30,		December 31,
	2014		2013
Finished goods	$	24,309	$	20,870
Raw materials and components		3,830		6,923

	$	28,139	$	27,793

Summary of Accrued Expenses

Accrued expenses consist of the following (in thousands):


	September 30,		December 31,
	2014		2013
Royalties	$	3,327	$	4,243
Payroll and related expenses		2,408		4,828
Product warranty		1,324		2,244
Market development funds and price protection		2,416		3,059
Professional fees		1,392		1,040
Deferred revenue		1,009		2,999
Restructuring		3,909		610
Other		4,929		4,248

	$	20,714	$	23,271

Summary of Accrued Warranty Obligations

Accrued warranty obligations consist of the following (in thousands):


	Three Months Ended September 30, 2014			Three Months Ended September 30, 2013			Nine Months Ended September 30, 2014			Nine Months Ended September 30, 2013

Warranty liability at beginning of period	$	1,580		$	2,451		$	2,244		$	2,329
Additions charged to operations		317			722			1,078			4,086
Deductions from/use of liability		(573	)		(818	)		(1,998	)		(4,060	)

Warranty liability at end of period	$	1,324		$	2,355		$	1,324		$	2,355

Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Amortizable Purchased Intangible Assets from 2010 Acquisition

The Company’s amortizable purchased intangible assets resulting from its 2010 acquisition of Enfora, Inc. (“Enfora”) are composed of (in thousands):


	September 30, 2014
	Gross		Accumulated Amortization			Accumulated Impairment			Net

Developed technologies	$	26,000	$	(6,371	)	$	(19,547	)	$	82
Trade name		12,800		(3,053	)		(8,582	)		1,165
Other		3,720		(2,000	)		(1,620	)		100

Total amortizable purchased intangible assets	$	42,520	$	(11,424	)	$	(29,749	)	$	1,347


	December 31, 2013
	Gross		Accumulated Amortization			Accumulated Impairment			Net

Developed technologies	$	26,000	$	(6,120	)	$	(19,547	)	$	333
Trade name		12,800		(2,665	)		(8,582	)		1,553
Other		3,720		(1,967	)		(1,620	)		133

Total amortizable purchased intangible assets	$	42,520	$	(10,752	)	$	(29,749	)	$	2,019

Summary of Amortization Expenses of Purchased Intangible Assets

The following table presents details of the amortization of purchased intangible assets included in the cost of net revenues and general and administrative expense categories (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2014		2013		2014		2013

Cost of net revenues	$	83	$	83	$	250	$	250
General and administrative expenses		141		141		421		422


Total amortization expense	$	224	$	224	$	671	$	672

Schedule of Amortization Expense of Purchased Intangible Assets Expected to be Recognized

The following table represents details of the amortization of existing purchased intangible assets that is currently estimated to be expensed in the remainder of 2014 and thereafter (in thousands):


Fiscal year:	Amount
2014 (remaining 3 months)	$	224
2015		562
2016		561


Total	$	1,347

Fair Value Measurement of Assets and Liabilities (Tables)

9 Months Ended

Sep. 30, 2014

Fair Value Disclosures [Abstract]

Summary of Company's Financial Instruments, Fair Value on a Recurring Basis


Description	September 30, 2014		Level 1		Level 2		Level 3

Assets:
Cash equivalents
US Treasury securities	$	1	$	0	$	1	$	0

Total cash equivalents		1		0		1		0

Short-term marketable securities:
Available-for-sale:
Government agency securities		0		0		0		0
Municipal bonds		980		0		980		0
Certificates of deposit		4,117		0		4,117		0
Corporate debentures / bonds		0		0		0		0

Total short-term marketable securities		5,097		0		5,097		0


Long-term marketable securities:
Available-for-sale:
Government agency securities		0		0		0		0
Municipal bonds		261		0		261		0
Certificates of deposit		0		0		0		0
Corporate debentures / bonds		0		0		0		0

Total long-term marketable securities		261		0		261		0

Total financial assets	$	5,359	$	0	$	5,359	$	0

Liabilities:
Warrant liability	$	9,727	$	0	$	0	$	9,727


Description	December 31, 2013		Level 1		Level 2		Level 3

Assets:
Cash equivalents
US Treasury securities	$	487	$	0	$	487	$	0

Total cash equivalents		487		0		487		0

Short-term marketable securities:
Available-for-sale:
Government agency securities		2,351		0		2,351		0
Municipal bonds		2,829		0		2,829		0
Certificates of deposit		3,360		0		3,360		0
Corporate debentures / bonds		10,638		0		10,638		0

Total short-term marketable securities		19,178		0		19,178		0

Long-term marketable securities:
Available-for-sale:
Municipal bonds		0		0		0		0
Certificates of deposit		1,300		0		1,300		0
Corporate debentures / bonds		2,143		0		2,143		0

Total long-term marketable securities		3,443		0		3,443		0

Total financial assets	$	23,108	$	0	$	23,108	$	0

Share-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of Share-Based Compensation Expense


	Three Months Ended September 30						Nine Months Ended September 30
	2014			2013			2014			2013
Cost of net revenues (1)	$	12		$	(7	)	$	(7	)	$	49
Research and development		190			329			448			908
Sales and marketing		(21	)		215			200			618
General and administrative		196			422			975			1,273

Totals	$	377		$	959		$	1,616		$	2,848

(1)	Negative expense resulted from a change in the estimated forfeiture rate during the first quarters of 2013 and 2014.

Segment Information and Concentrations of Risk (Tables)

9 Months Ended

Sep. 30, 2014

Segment Reporting [Abstract]

Schedule of Net Revenues, Operating Loss and Identifiable Assets of Segments

The table below presents net revenues from external customers, operating loss and identifiable assets for the Company’s reportable segments (in thousands):


	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
Net revenues by reportable segment:
Mobile Computing Products	$	34,788		$	84,067		$	98,483		$	240,510
M2M Products and Solutions		9,542			8,606			31,401			29,208

Total	$	44,330		$	92,673		$	129,884		$	269,718


Operating loss by reportable segment:
Mobile Computing Products	$	(1,704	)	$	(953	)	$	(20,076	)	$	(9,801	)
M2M Products and Solutions		(2,192	)		(3,911	)		(10,145	)		(11,992	)

Total	$	(3,896	)	$	(4,864	)	$	(30,221	)	$	(21,793	)


	September 30,		December 31,
	2014		2013
Identifiable assets by reportable segment:
Mobile Computing Products	$	80,551	$	96,516
M2M Products and Solutions		12,494		14,949

Total	$	93,045	$	111,465

Schedule of Geographic Concentration of the Assets


	September 30,		December 31,
	2014		2013
United States	$	91,241	$	108,932
Canada		951		808
Europe, Latin America and Asia		853		1,725

	$	93,045	$	111,465

Schedule of Geographic Concentration of Net Revenues

The following table details the concentration of the Company’s net revenues by geographic region:


	Three months ended						Nine months ended
	September 30,						September 30,
	2014			2013			2014			2013
United States and Canada		90	%		97	%		90	%		96	%
Latin America		1			1			1			1
Europe, Middle East and Africa		7			2			8			3
Asia and Australia		2			0			1			0

		100	%		100	%		100	%		100	%

Securities Purchase Agreement (Tables)

9 Months Ended

Sep. 30, 2014

Text Block [Abstract]

Summary of Change to Fair Value of Warrant

The following table shows the change to the fair value of the Warrant during the three months ended September 30, 2014 (in thousands):


Warrant Derivative Liability	Level 3
Beginning balance at September 8, 2014	$	4,939
Change in fair value		4,788

Ending balance at September 30, 2014	$	9,727

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

+ References + Details

Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2014

Earnings Per Share [Abstract]

Schedule of Earnings Per Share Basic and Diluted


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2014			2013			2014			2013
Numerator
Net loss:	$	(8,832	)	$	(5,093	)	$	(35,228	)	$	(22,107	)

Denominator
Weighted-average common shares outstanding		38,167			34,070			35,568			33,902

Basic and diluted net loss per share	$	(0.23	)	$	(0.15	)	$	(0.99	)	$	(0.65	)

Schedule of Securities Not Included in Dilutive Loss Per Share


	September 30
	2014
Securities not included in dilutive loss per share relating to:
Common stock warrants outstanding		4,118
Series C Preferred Stock		872
Stock Options		2,965
Employee Stock Purchase Plan		1,500
Restricted Stock Units		1,854

		11,309

Restructuring (Tables)

9 Months Ended

Sep. 30, 2014

Restructuring and Related Activities [Abstract]

Summary of Restructuring Liability

The following table sets forth activity in the restructuring liability for the nine months ended September 30, 2014 (in thousands):


	2013 Initiatives						2014 Initiatives
	Employee Severance Costs			Facility Exit Related Costs			Employment Contract Costs			Share-based Compensation Costs			Total

Balance at December 31, 2013	$	0		$	881		$	0		$	0		$	881
Accruals		1,713			917			3,551			1,298			7,479
Payments		(1,641	)		(739	)		(359	)		0			(2,739	)
Stock-based compensation		0			0			0			(1,298	)		(1,298	)

Balance at September 30, 2014	$	72		$	1,059		$	3,192		$	(0	)	$	4,323

Balance Sheet Details - Summary of Marketable Securities Available-for-Sale (Detail) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 5,358	$ 22,616
Gross Unrealized Gains	0	5
Gross Unrealized Losses	0	0
Estimated Fair Value	5,358	22,621
Short-Term Marketable Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	5,097	19,173
Gross Unrealized Gains	0	5
Gross Unrealized Losses	0	0
Estimated Fair Value	5,097	19,178
Long-Term Marketable Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	261	3,443
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Estimated Fair Value	$ 261	$ 3,443
Government Agency Securities [Member] \| Short-Term Marketable Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Maturity in Years	1 or less	1 or less
Amortized Cost	$ 0	$ 2,350
Gross Unrealized Gains	0	1
Gross Unrealized Losses	0	0
Estimated Fair Value	$ 0	$ 2,351
Municipal Bonds [Member] \| Short-Term Marketable Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Maturity in Years	1 or less	1 or less
Amortized Cost	$ 980	$ 2,828
Gross Unrealized Gains	0	1
Gross Unrealized Losses	0	0
Estimated Fair Value	$ 980	$ 2,829
Municipal Bonds [Member] \| Long-Term Marketable Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Maturity in Years	1 to 2	1 to 2
Amortized Cost	$ 261	$ 0
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Estimated Fair Value	$ 261	$ 0
Certificates of Deposit [Member] \| Short-Term Marketable Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Maturity in Years	1 or less	1 or less
Amortized Cost	$ 4,117	$ 3,360
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Estimated Fair Value	$ 4,117	$ 3,360
Certificates of Deposit [Member] \| Long-Term Marketable Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Maturity in Years	1 to 2	1 to 2
Amortized Cost	$ 0	$ 1,300
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Estimated Fair Value	$ 0	$ 1,300
Corporate Debentures / Bonds [Member] \| Short-Term Marketable Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Maturity in Years	1 or less	1 or less
Amortized Cost	$ 0	$ 10,635
Gross Unrealized Gains	0	3
Gross Unrealized Losses	0	0
Estimated Fair Value	$ 0	$ 10,638
Corporate Debentures / Bonds [Member] \| Long-Term Marketable Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Maturity in Years	1 to 2	1 to 2
Amortized Cost	$ 0	$ 2,143
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Estimated Fair Value	$ 0	$ 2,143

Balance Sheet Details - Additional Information (Detail) - USD ($)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Condensed Financial Statements, Captions [Line Items]
Borrowings under the facility interest rate	1.00%
Cash equivalents and marketable securities held at bank	$ 2,600,000
Company's unused borrowing capacity under credit facility	786,000
Outstanding borrowings under the credit facility	0
Net unrealized loss	5,000
Provision for excess and obsolete inventory	$ 3,033,000	$ 3,069,000
Product warranty description	One to three years of warranty coverage for products following the date of purchase
Minimum [Member]
Condensed Financial Statements, Captions [Line Items]
Product warranty period	1 year
Maximum [Member]
Condensed Financial Statements, Captions [Line Items]
Product warranty period	3 years

Balance Sheet Details - Summary of Inventories (Detail) - USD ($) $ in Thousands	Sep. 30, 2014	Dec. 31, 2013
Inventory Disclosure [Abstract]
Finished goods	$ 24,309	$ 20,870
Raw materials and components	3,830	6,923
Total inventory	$ 28,139	$ 27,793

Balance Sheet Details - Summary of Accrued Expenses (Detail) - USD ($) $ in Thousands	Sep. 30, 2014	Jun. 30, 2014	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Dec. 31, 2012
Payables and Accruals [Abstract]
Royalties	$ 3,327		$ 4,243
Payroll and related expenses	2,408		4,828
Product warranty	1,324	$ 1,580	2,244	$ 2,355	$ 2,451	$ 2,329
Market development funds and price protection	2,416		3,059
Professional fees	1,392		1,040
Deferred revenue	1,009		2,999
Restructuring	3,909		610
Other	4,929		4,248
Accrued expenses, Total	$ 20,714		$ 23,271

Balance Sheet Details - Summary of Accrued Warranty Obligations (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Guarantees [Abstract]
Warranty liability at beginning of period	$ 1,580	$ 2,451	$ 2,244	$ 2,329
Additions charged to operations	317	722	1,078	4,086
Deductions from/use of liability	(573)	(818)	(1,998)	(4,060)
Warranty liability at end of period	$ 1,324	$ 2,355	$ 1,324	$ 2,355

Intangible Assets - Schedule of Amortizable Purchased Intangible Assets from 2010 Acquisition (Detail) - USD ($) $ in Thousands	Sep. 30, 2014	Dec. 31, 2013
Finite-Lived Intangible Assets [Line Items]
Gross	$ 42,520	$ 42,520
Accumulated Amortization	(11,424)	(10,752)
Accumulated Impairment	(29,749)	(29,749)
Net	1,347	2,019
Developed Technologies [Member]
Finite-Lived Intangible Assets [Line Items]
Gross	26,000	26,000
Accumulated Amortization	(6,371)	(6,120)
Accumulated Impairment	(19,547)	(19,547)
Net	82	333
Trade Name [Member]
Finite-Lived Intangible Assets [Line Items]
Gross	12,800	12,800
Accumulated Amortization	(3,053)	(2,665)
Accumulated Impairment	(8,582)	(8,582)
Net	1,165	1,553
Other [Member]
Finite-Lived Intangible Assets [Line Items]
Gross	3,720	3,720
Accumulated Amortization	(2,000)	(1,967)
Accumulated Impairment	(1,620)	(1,620)
Net	$ 100	$ 133

Intangible Assets - Summary of Amortization Expenses of Purchased Intangible Assets (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Finite-Lived Intangible Assets [Line Items]
Amortization of purchased intangible assets	$ 141	$ 141	$ 421	$ 422
Cost of Net Revenues [Member]
Finite-Lived Intangible Assets [Line Items]
Amortization of purchased intangible assets	83	83	250	250
General and Administrative Expenses [Member]
Finite-Lived Intangible Assets [Line Items]
Amortization of purchased intangible assets	141	141	421	422
Total Amortization Expense [Member]
Finite-Lived Intangible Assets [Line Items]
Amortization of purchased intangible assets	$ 224	$ 224	$ 671	$ 672

Intangible Assets - Schedule of Amortization Expense of Purchased Intangible Assets Expected to be Recognized (Detail) - USD ($) $ in Thousands	Sep. 30, 2014	Dec. 31, 2013
Goodwill and Intangible Assets Disclosure [Abstract]
2014 (remaining 3 months)	$ 224
2015	562
2016	561
Net	$ 1,347	$ 2,019

Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands	Sep. 30, 2014	Dec. 31, 2013
Finite-Lived Intangible Assets [Line Items]
Purchased intangible assets net	$ 1,527	$ 2,131
Intangible assets, accumulated amortization	13,729	12,983
Acquired Software Licenses [Member]
Finite-Lived Intangible Assets [Line Items]
Purchased intangible assets net	180	112
Intangible assets, accumulated amortization	$ 2,300	$ 2,200

Fair Value Measurement of Assets and Liabilities - Summary of Company's Financial Instruments, Fair Value on a Recurring Basis (Detail) - USD ($) $ in Thousands	Sep. 30, 2014	Dec. 31, 2013
Liabilities:
Warrant liability	$ 9,727	$ 0
Fair Value, Measurements, Recurring [Member]
Cash equivalents
Total cash equivalents	1	487
Available-for-sale:
Total short-term marketable securities	5,097	19,178
Total long-term marketable securities	261	3,443
Total financial assets	5,359	23,108
Liabilities:
Warrant liability	9,727
Fair Value, Measurements, Recurring [Member] \| Government Agency Securities [Member]
Available-for-sale:
Total short-term marketable securities	0	2,351
Total long-term marketable securities	0
Fair Value, Measurements, Recurring [Member] \| Municipal Bonds [Member]
Available-for-sale:
Total short-term marketable securities	980	2,829
Total long-term marketable securities	261	0
Fair Value, Measurements, Recurring [Member] \| Certificates of Deposit [Member]
Available-for-sale:
Total short-term marketable securities	4,117	3,360
Total long-term marketable securities	0	1,300
Fair Value, Measurements, Recurring [Member] \| Corporate Debentures / Bonds [Member]
Available-for-sale:
Total short-term marketable securities	0	10,638
Total long-term marketable securities	0	2,143
Fair Value, Measurements, Recurring [Member] \| US Treasury Securities [Member]
Cash equivalents
Total cash equivalents	1	487
Level 1 [Member]
Cash equivalents
Total cash equivalents	0	0
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0	0
Total financial assets	0	0
Liabilities:
Warrant liability	0
Level 1 [Member] \| Government Agency Securities [Member]
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0
Level 1 [Member] \| Municipal Bonds [Member]
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0	0
Level 1 [Member] \| Certificates of Deposit [Member]
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0	0
Level 1 [Member] \| Corporate Debentures / Bonds [Member]
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0	0
Level 1 [Member] \| US Treasury Securities [Member]
Cash equivalents
Total cash equivalents	0	0
Level 2 [Member]
Cash equivalents
Total cash equivalents	1	487
Available-for-sale:
Total short-term marketable securities	5,097	19,178
Total long-term marketable securities	261	3,443
Total financial assets	5,359	23,108
Liabilities:
Warrant liability	0
Level 2 [Member] \| Government Agency Securities [Member]
Available-for-sale:
Total short-term marketable securities	0	2,351
Total long-term marketable securities	0
Level 2 [Member] \| Municipal Bonds [Member]
Available-for-sale:
Total short-term marketable securities	980	2,829
Total long-term marketable securities	261	0
Level 2 [Member] \| Certificates of Deposit [Member]
Available-for-sale:
Total short-term marketable securities	4,117	3,360
Total long-term marketable securities	0	1,300
Level 2 [Member] \| Corporate Debentures / Bonds [Member]
Available-for-sale:
Total short-term marketable securities	0	10,638
Total long-term marketable securities	0	2,143
Level 2 [Member] \| US Treasury Securities [Member]
Cash equivalents
Total cash equivalents	1	487
Level 3 [Member]
Cash equivalents
Total cash equivalents	0	0
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0	0
Total financial assets	0	0
Liabilities:
Warrant liability	9,727
Level 3 [Member] \| Government Agency Securities [Member]
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0
Level 3 [Member] \| Municipal Bonds [Member]
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0	0
Level 3 [Member] \| Certificates of Deposit [Member]
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0	0
Level 3 [Member] \| Corporate Debentures / Bonds [Member]
Available-for-sale:
Total short-term marketable securities	0	0
Total long-term marketable securities	0	0
Level 3 [Member] \| US Treasury Securities [Member]
Cash equivalents
Total cash equivalents	$ 0	$ 0

Share-Based Compensation - Summary of Share-Based Compensation Awards (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Amounts for share-based compensation expense	$ 377	$ 959	$ 1,616	$ 2,848
Cost of Net Revenues [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Amounts for share-based compensation expense	12	(7)	(7)	49
Research and Development [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Amounts for share-based compensation expense	190	329	448	908
Sales and Marketing [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Amounts for share-based compensation expense	(21)	215	200	618
General and Administrative [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Amounts for share-based compensation expense	$ 196	$ 422	$ 975	$ 1,273

Share-Based Compensation - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Restructuring charges related to the termination of former Chief Executive Officer	$ 1,064	$ 2,411	$ 7,480	$ 2,411
Accelerated Share Based Compensation [Member] \| Chief Executive Officer [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Restructuring charges related to the termination of former Chief Executive Officer			$ 1,300

Employee Stock Purchase Plan - Additional Information (Detail) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2014	Aug. 16, 2014
Employee Stock Purchase Plan [Member]
Subsidiary, Sale of Stock [Line Items]
Total fair value of awards recognized as expenses	$ 26,218	$ 26,218
Employee Stock Purchase Plan [Member]
Subsidiary, Sale of Stock [Line Items]
Percentage of discount from market price of shares		85.00%
Maximum limit of payroll deductions		10.00%
Number of shares issue that the ESPP authorizes for purchase by eligible employees			1,500,132

Segment Information and Concentrations of Risk - Schedule of Net Revenues, Operating Loss and Identifiable Assets of Segments (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013
Net revenues by reportable segment:
Net revenues	$ 44,330	$ 92,673	$ 129,884	$ 269,718
Operating loss by reportable segment:
Operating loss	(3,896)	(4,864)	(30,221)	(21,793)
Identifiable assets by reportable segment:
Identifiable assets	93,045		93,045		$ 111,465
Mobile Computing Products [Member]
Net revenues by reportable segment:
Net revenues	34,788	84,067	98,483	240,510
Operating loss by reportable segment:
Operating loss	(1,704)	(953)	(20,076)	(9,801)
Identifiable assets by reportable segment:
Identifiable assets	80,551		80,551		96,516
M2M Products and Solutions [Member]
Net revenues by reportable segment:
Net revenues	9,542	8,606	31,401	29,208
Operating loss by reportable segment:
Operating loss	(2,192)	$ (3,911)	(10,145)	$ (11,992)
Identifiable assets by reportable segment:
Identifiable assets	$ 12,494		$ 12,494		$ 14,949

Segment Information and Concentrations of Risk - Schedule of Geographic Concentration of Assets (Detail) - USD ($) $ in Thousands	Sep. 30, 2014	Dec. 31, 2013
Revenues from External Customers and Long-Lived Assets [Line Items]
Assets by Geographic Concentration, Total	$ 93,045	$ 111,465
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Assets by Geographic Concentration, Total	91,241	108,932
Canada [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Assets by Geographic Concentration, Total	951	808
Europe, Latin America and Asia [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Assets by Geographic Concentration, Total	$ 853	$ 1,725

Segment Information and Concentrations of Risk - Schedule of Geographic Concentration of Net Revenues (Detail) - Net Revenues [Member] - Geographic Concentration [Member]	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Revenues from External Customers and Long-Lived Assets [Line Items]
Concentration percentage	100.00%	100.00%	100.00%	100.00%
United States and Canada [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Concentration percentage	90.00%	97.00%	90.00%	96.00%
Latin America [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Concentration percentage	1.00%	1.00%	1.00%	1.00%
Europe, Middle East and Africa [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Concentration percentage	7.00%	2.00%	8.00%	3.00%
Asia and Australia [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Concentration percentage	2.00%	0.00%	1.00%	0.00%

Segment Information and Concentrations of Risk - Additional Information (Detail) - Segments	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Segment Reporting Information [Line Items]
Number of business segments			2
Net Revenues [Member] \| Customer Concentration [Member]
Segment Reporting Information [Line Items]
Net revenues, percentage		59.00%	44.00%	61.00%
Net Revenues [Member] \| Customer Concentration [Member] \| Customer One [Member]
Segment Reporting Information [Line Items]
Net revenues, percentage	54.00%
Net Revenues [Member] \| Customer Concentration [Member] \| Customer Two [Member]
Segment Reporting Information [Line Items]
Net revenues, percentage	12.00%

Securities Purchase Agreement - Additional Information (Detail)		3 Months Ended		9 Months Ended
	Sep. 08, 2014 USD ($) $ / shares $ / Warrant shares	Sep. 30, 2014 USD ($) $ / shares $ / Warrant shares	Sep. 30, 2013 USD ($)	Sep. 30, 2014 USD ($) $ / shares $ / Warrant shares	Sep. 30, 2013 USD ($)	Dec. 31, 2013 $ / shares shares
Changes In Equity And Comprehensive Income Line Items [Line Items]
Common stock shares issued at par value \| $ / shares		$ 0.001		$ 0.001		$ 0.001
Warrants to purchase common stock sold		4,117,647		4,117,647
Exercise price per share \| $ / Warrant		2.26		2.26
Aggregate gross proceeds \| $				$ 14,163,000	$ 0
Common stock, shares authorized		50,000,000		50,000,000		50,000,000
Expense on fair value warrants \| $		$ 4,788,000	$ 0	$ 4,788,000	$ 0
Preferred stock conversion feature into common shares				Each share of Series C Preferred Stock is initially convertible into ten shares of common stock
2009 Omnibus Incentive Compensation Plan [Member]
Changes In Equity And Comprehensive Income Line Items [Line Items]
Unreserved shares previously approved for issuance				1,651,455
2000 Stock Compensation Plan [Member]
Changes In Equity And Comprehensive Income Line Items [Line Items]
Unreserved shares previously approved for issuance				1,300,000
Series C Preferred Stock [Member]
Changes In Equity And Comprehensive Income Line Items [Line Items]
Number of shares sold	87,196
Convertible preferred stock par value \| $ / shares	$ 0.001
Number of shares sold, Per share price \| $ / shares	$ 17.50	$ 17.50		$ 17.50
Aggregate gross proceeds \| $	$ 14,400,000
Number of shares sold \| $ / shares				$ 87,196
Number of fractional shares of common stock issued		0		0
Preferred stock dividend rate, percentage				12.50%
Beneficial conversion feature \| $		$ 445,000		$ 445,000
Series C Convertible Preferred Stock [Member]
Changes In Equity And Comprehensive Income Line Items [Line Items]
Common stock shares reserved for issuance		871,960		871,960
Scenario, Plan [Member]
Changes In Equity And Comprehensive Income Line Items [Line Items]
Common stock, shares authorized		100,000,000		100,000,000
Common Stock [Member]
Changes In Equity And Comprehensive Income Line Items [Line Items]
Number of shares sold	7,363,334			7,363,334
Common stock shares issued at par value \| $ / shares	$ 0.001
Number of shares sold, Per share price \| $ / shares	$ 1.75
Warrant [Member]
Changes In Equity And Comprehensive Income Line Items [Line Items]
Warrants to purchase common stock sold	4,117,647
Exercise price per share \| $ / Warrant	2.26
Common stock outstanding exercise percentage				19.999%

Securities Purchase Agreement - Summary of Change to Fair Value of Warrant (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Common Stock Warrants [Line Items]
Beginning balance			$ 0
Change in fair value	$ 4,788	$ 0	4,788	$ 0
Ending balance	9,727		9,727
Level 3 [Member]
Common Stock Warrants [Line Items]
Beginning balance	4,939
Change in fair value	4,788
Ending balance	$ 9,727		$ 9,727

Earnings Per Share - Additional Information (Detail) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Equity [Abstract]
Basic and diluted weighted-average common and common shares outstanding	38,167,000	34,070,000	35,568,000	33,902,000
Acquisition of common stock from anti-dilutive securities	4,761,066	5,668,752	5,313,009	5,885,100

Earnings Per Share - Schedule of Earnings Per Share Basic and Diluted (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Numerator
Net loss:	$ (8,832)	$ (5,093)	$ (35,228)	$ (22,107)
Denominator
Weighted-average common shares outstanding	38,167	34,070	35,568	33,902
Basic and diluted net loss per share	$ (0.23)	$ (0.15)	$ (0.99)	$ (0.65)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Earnings Per Share - Schedule of Securities Not Included in Dilutive Loss Per Share (Detail) shares in Thousands	9 Months Ended
	Sep. 30, 2014 shares
Securities not included in dilutive loss per share relating to:
Securities not included in dilutive loss per share	11,309
Warrant [Member]
Securities not included in dilutive loss per share relating to:
Securities not included in dilutive loss per share	4,118
Stock Options [Member]
Securities not included in dilutive loss per share relating to:
Securities not included in dilutive loss per share	2,965
Employee Stock Purchase Plan [Member]
Securities not included in dilutive loss per share relating to:
Securities not included in dilutive loss per share	1,500
Restricted Stock Units [Member]
Securities not included in dilutive loss per share relating to:
Securities not included in dilutive loss per share	1,854
Series C Preferred Stock [Member]
Securities not included in dilutive loss per share relating to:
Securities not included in dilutive loss per share	872

Commitments and Contingencies - Additional Information (Detail) - USD ($)			9 Months Ended	12 Months Ended
	Jul. 08, 2014	Jun. 23, 2014	Sep. 30, 2014	Dec. 31, 2013	Jul. 17, 2014	Jun. 30, 2014
Loss Contingencies [Line Items]
Settlements on legal matters, common stock				$ 5,000,000
Settlements on legal matters, promissory notes				5,000,000
Amount for share price fluctuation related to litigation settlement		$ 725,000
Probable relief in additional cash payment		725,000
Asserted claims not accrued in financial		$ 725,000
Settlement funded by insurers for the Company				1,700,000
Accrual of payment in current liabilities			$ 7,000	4,326,000		$ 4,300,000
Settlements on legal matters, cash				5,000,000
Cash portion of the settlements, paid				$ 4,300,000
September Fifteenth Two Thousand Eight [Member]
Loss Contingencies [Line Items]
Lawsuit filing date			September 15, 2008
September Eighteenth Two Thousand Eight [Member]
Loss Contingencies [Line Items]
Lawsuit filing date			September 18, 2008
Subsequent Event [Member]
Loss Contingencies [Line Items]
Settlements on legal matters, promissory notes	$ 5,000,000
Cash portion of the settlements, paid	4,300,000
Subsequent Event [Member] \| Unrestricted Shares [Member]
Loss Contingencies [Line Items]
Settlements on legal matters, common stock	$ 5,000,000
Number of common stock for distribution to class members					2,407,318
Secured Promissory Note [Member]
Loss Contingencies [Line Items]
Secured note interest rate percentage			5.00%
Secured note maturity period			30 months

Income Taxes - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013
Operating Loss Carryforwards [Line Items]
Deferred tax benefits including income tax expense	$ 3,200,000		$ 12,300,000
Valuation allowance	91,800,000		91,800,000
Net deferred tax assets	91,900,000		91,900,000
Income tax benefit including discrete items	24,000	$ 319,000	$ 73,000	$ 340,000
Internal revenue code related to annual use of operating loss carry forwards			Annual use of the Company's net operating loss and research and development credit carryforwards may be limited in the event a cumulative change in ownership of more than 50% occurs within a three-year period.
Internal revenue code, cumulative change in ownership			50.00%
Uncertain income tax position unrecognized			Less than a 50% likelihood
Total liability for unrecognized tax benefits included other long-term liabilities			$ 62,000		$ 62,000
Interest benefit on uncertain tax positions	$ 0		0
Scenario, Forecast [Member]
Operating Loss Carryforwards [Line Items]
Expected unrecognized tax benefits due to expiration of limitations applicable to the 2009 taxable year			$ 62,000

Restructuring - Additional Information (Detail)			3 Months Ended			9 Months Ended		12 Months Ended
Restructuring - Additional Information (Detail)	Mar. 31, 2014 Employees	Feb. 28, 2014 Employees	Sep. 30, 2014 USD ($)	Jun. 30, 2014 Employees	Sep. 30, 2013 USD ($)	Sep. 30, 2014 USD ($)	Sep. 30, 2013 USD ($)	Sep. 30, 2014 USD ($)	Dec. 31, 2013 USD ($)
Restructuring Cost and Reserve [Line Items]
Restructuring charges			$ 1,064,000		$ 2,411,000	$ 7,480,000	$ 2,411,000
Expense related to accelerated vesting of restricted stock						1,298,000
Restructuring liability current			3,909,000			3,909,000		$ 3,909,000	$ 610,000
Restructuring liability non-current			414,000			414,000		414,000
September 2013 Restructuring Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Reduction in number of employees after restructuring \| Employees	21	41		5
Restructuring charges			87,000			2,600,000		$ 5,900,000	$ 3,300,000
September 2013 Restructuring Initiatives [Member] \| Employee Severance Costs [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges						1,700,000
Expense related to accelerated vesting of restricted stock						0
September 2013 Restructuring Initiatives [Member] \| Facility Exit Related Costs [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges						917,000
September 2014 Restructuring Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Expense related to accelerated vesting of restricted stock						1,300,000
September 2014 Restructuring Initiatives [Member] \| Chief Executive Officer [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges			$ 1,100,000			$ 4,800,000

Restructuring - Summary of Restructuring Liability (Detail) $ in Thousands	9 Months Ended
	Sep. 30, 2014 USD ($)
Restructuring Cost and Reserve [Line Items]
Balance at December 31, 2013	$ 881
Accruals	7,479
Payments	(2,739)
Stock-based compensation	(1,298)
Balance at September 30, 2014	4,323
September 2014 Restructuring Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Stock-based compensation	(1,300)
Employee Severance Costs [Member] \| September 2013 Restructuring Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Balance at December 31, 2013	0
Accruals	1,713
Payments	(1,641)
Stock-based compensation	0
Balance at September 30, 2014	72
Facility Exit Related Costs [Member] \| September 2013 Restructuring Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Balance at December 31, 2013	881
Accruals	917
Payments	(739)
Stock-based compensation	0
Balance at September 30, 2014	1,059
Employment Contract Costs [Member] \| September 2014 Restructuring Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Balance at December 31, 2013	0
Accruals	3,551
Payments	(359)
Stock-based compensation	0
Balance at September 30, 2014	3,192
Sharebased Compensation Costs [Member] \| September 2014 Restructuring Initiatives [Member]
Restructuring Cost and Reserve [Line Items]
Balance at December 31, 2013	0
Accruals	1,298
Payments	0
Stock-based compensation	(1,298)
Balance at September 30, 2014	$ 0

Subsequent Events - Additional Information (Detail) - USD ($)		1 Months Ended	9 Months Ended
	Oct. 31, 2014	Oct. 31, 2014	Sep. 30, 2014
Subsequent Event [Line Items]
Revolving credit facility, maximum revolver amount			$ 786,000
Interest rate margin			1.00%
Subsequent Event [Member] \| Senior Secured Revolving Credit Facility [Member]
Subsequent Event [Line Items]
Letters of credit	$ 3,000,000	$ 3,000,000
Interest rate base rate description	LIBOR rate
Revolving credit facility, description			The Company may borrow funds under the Revolver from time to time, with interest payable monthly at a base rate determined by using the daily three month LIBOR rate, plus an applicable margin of 2.50% to 3.00% depending on the Company's liquidity as determined on the last day of each calendar month.
Subsequent Event [Member] \| Senior Secured Revolving Credit Facility [Member] \| Minimum [Member]
Subsequent Event [Line Items]
Interest rate margin	2.50%
Subsequent Event [Member] \| Senior Secured Revolving Credit Facility [Member] \| Maximum [Member]
Subsequent Event [Line Items]
Interest rate margin	3.00%
Subsequent Event [Member] \| Wells Fargo Bank, National Association [Member] \| Senior Secured Revolving Credit Facility [Member]
Subsequent Event [Line Items]
Acquisition date		Oct. 31, 2014
Revolving credit facility, maximum revolver amount	$ 25,000,000	$ 25,000,000
Revolving credit facility expiration period		5 years