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Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Dec. 31, 2016	Feb. 01, 2017
Document And Entity Information [Abstract]
Entity Registrant Name	EMCORE CORPORATION
Entity Central Index Key	0000808326
Document Type	10-Q
Document Period End Date	Dec. 31, 2016
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2016
Current Fiscal Year End Date	--09-30
Entity Filer Category	Accelerated Filer
Amendment Flag	false
Entity Common Stock, Shares Outstanding		26,584,521

Condensed Consolidated Statements of Operations and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Income Statement [Abstract]
Revenue	$ 30,176	$ 22,490
Cost of revenue	20,133	15,089
Gross profit	10,043	7,401
Operating expense:
Selling, general, and administrative	5,578	4,821
Research and development	2,199	2,560
Total operating expense	7,777	7,381
Operating income	2,266	20
Other income (expense):
Interest income (expense), net	23	(17)
Foreign exchange loss	(403)	(135)
Total other expense	(380)	(152)
Income (loss) from continuing operations before income tax expense	1,886	(132)
Income tax expense	(120)	(2)
Income (loss) from continuing operations	1,766	(134)
(Loss) income from discontinued operations, net of tax	(9)	1,121
Net income	1,757	987
Foreign exchange translation adjustment	(260)	(88)
Comprehensive income	$ 1,497	$ 899
Per share data:
Net income (loss) per basic share, continuing operations, (in usd per share)	$ 0.07	$ 0.00
Net income per basic share, discontinued operations (in usd per share)	0.00	0.04
Net income per basic share (in usd per share)	0.07	0.04
Net income (loss) per diluted share, continuing operations (in usd per share)	0.07	0.00
Net income per diluted share, discontinued operations (in usd per share)	0.00	0.04
Net income per diluted share (in usd per share)	$ 0.07	$ 0.04
Weighted-average number of basic shares outstanding (in shares)	26,279	25,697
Weighted-average number of basic shares outstanding (in shares)	27,039	25,697

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2016	Sep. 30, 2016
Current assets:
Cash and cash equivalents	$ 62,181	$ 63,905
Restricted cash	562	965
Accounts receivable, net of allowance of $33 and $36, respectively	21,029	18,432
Inventory	28,198	24,150
Prepaid expenses and other current assets	3,564	3,764
Total current assets	115,534	111,216
Property, plant, and equipment, net	14,043	12,213
Non-current inventory	3,565	3,531
Other non-current assets, net of allowance of $0	257	251
Total assets	133,399	127,211
Current liabilities:
Accounts payable	14,806	10,575
Accrued expenses and other current liabilities	7,331	7,684
Total current liabilities	22,137	18,259
Asset retirement obligations	1,590	1,573
Other long-term liabilities	60	62
Total liabilities	23,787	19,894
Commitments and contingencies (Note 11)
Shareholders’ equity:
Preferred stock, $0.0001 par value, 5,882 shares authorized; none issued or outstanding	0	0
Common stock, no par value, 50,000 shares authorized; 33,185 shares issued and 26,275 shares outstanding as of December 31, 2016; 33,154 shares issued and 26,244 shares outstanding as of September 30, 2016	726,678	725,880
Treasury stock at cost; 6,910 shares	(47,721)	(47,721)
Accumulated other comprehensive income	319	579
Accumulated deficit	(569,664)	(571,421)
Total shareholders’ equity	109,612	107,317
Total liabilities and shareholders’ equity	$ 133,399	$ 127,211

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2016	Sep. 30, 2016
Accounts receivable:
Allowance for doubtful accounts	$ 33	$ 36
Other non-current assets:
Allowance for non-current assets	$ 0	$ 0
Shareholders’ equity:
Preferred stock, par value (in usd per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	5,882,000	5,882,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (USD per share)	$ 0	$ 0
Common stock, shares authorized (in shares)	50,000,000	50,000,000
Common stock, shares issued (in shares)	33,185,000	33,154,000
Common stock, shares outstanding (in shares)	26,275,000	26,244,000
Treasury stock, shares held (in shares)	6,910,000	6,910,000

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Cash flows from operating activities:
Net income	$ 1,757	$ 987
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion expense	758	506
Stock-based compensation expense	772	387
Provision adjustments related to doubtful accounts	0	4
Provision adjustments related to product warranty	88	146
Gain on settlement of solar power assets and obligations	0	(689)
Gain on settlement of Newark lease	0	(310)
Total non-cash adjustments	1,618	44
Changes in operating assets and liabilities:
Accounts receivable	(2,645)	2,877
Inventory	(4,549)	2,115
Other assets	149	1,439
Accounts payable	4,824	(43)
Accrued expenses and other current liabilities	(495)	(1,686)
Total change in operating assets and liabilities	(2,716)	4,702
Net cash provided by operating activities	659	5,733
Cash flows from investing activities:
Purchase of equipment	(3,242)	(1,677)
Net cash used in investing activities	(3,242)	(1,677)
Cash flows from financing activities:
Proceeds from stock plans	104	186
Decrease (increase) in restricted cash	403	(728)
Net cash provided by (used in) financing activities	507	(542)
Effect of exchange rate changes on foreign currency	352	121
Net (decrease) increase in cash and cash equivalents	(1,724)	3,635
Cash and cash equivalents at beginning of period	63,905	111,885
Cash and cash equivalents at end of period	62,181	115,520
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the period for interest	20	23
Cash paid during the period for income taxes	2	108
NON-CASH INVESTING AND FINANCING ACTIVITIES
Changes in accounts payable related to purchases of equipment	$ (455)	$ (206)

Description of Business	3 Months Ended
Description of Business	Dec. 31, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Business	Description of Business Business Overview EMCORE Corporation together with its subsidiaries (referred to herein as the “Company”, “we”, “our”, or “EMCORE”), was established in 1984 as a New Jersey corporation, designs and manufactures Indium Phosphide (InP) optical chips, components, subsystems and systems for the broadband and specialty fiber optics market. EMCORE is a provider of optical components, as well as complete end-to-end solutions for high-speed communications network infrastructures enabling systems and service providers to meet growing demand for bandwidth and connectivity. EMCORE's advanced optical technologies are designed for cable television (CATV), fiber-to-the-premises (FTTP) networks, telecommunications and data centers, satellite communications, aerospace and defense, wireless networks, and broadcast and professional audio/video systems. With its InP semiconductor wafer fabrication facility, EMCORE has fully vertically-integrated manufacturing capability and also provides contract design, foundry and component packaging services. We currently have one reporting segment: Fiber Optics. In addition to organic growth and development of our existing Fiber Optics market, we intend to pursue other strategies to enhance shareholder value, which may include acquisitions, investments in joint ventures, partnerships, and other strategic alternatives, such as dispositions, reorganizations, recapitalizations or other similar transactions, the repurchase of shares of our outstanding common stock or payment of dividends to our shareholders, and we may engage financial and other advisers to assist in these efforts. Accordingly, the Strategy and Alternatives Committee of the Board of Directors and our management may from time to time be engaged in evaluating potential strategic opportunities and may enter into definitive agreements with respect to such transactions or other strategic alternatives. Sale of Photovoltaics and Digital Products Businesses In the fiscal year ended September 30, 2015 EMCORE completed the sale of the company's Photovoltaics Business to SolAero Technologies Corporation (“SolAero”) pursuant to the Asset Purchase Agreement (the “Photovoltaics Agreement”) under which SolAero acquired substantially all of the assets, and assumed substantially all of the liabilities, primarily related to or used in connection with the Company's photovoltaics business, including EMCORE's subsidiaries EMCORE Solar Power, Inc. and EMCORE IRB Company, LLC (collectively, the “Photovoltaics Business” and, the sale of the Photovoltaics Business, the “Photovoltaics Asset Sale”) for $149.9 million in cash. In the fiscal year ended September 30, 2015 EMCORE completed the sale of the company's telecommunications business (the “Digital Products Business”) to NeoPhotonics Corporation, a Delaware corporation (“NeoPhotonics”) pursuant to the Asset Purchase Agreement (the “Digital Products Agreement”), under which NeoPhotonics acquired certain assets, and certain liabilities, related to the Company's Digital Products Business for an aggregate purchase price of $17.5 million. No Photovoltaics Business or Digital Products Business assets or liabilities that were sold remain on the consolidated balance sheet as of December 31, 2016 or September 30, 2016. The financial results of the Photovoltaics Business and the Digital Products Business are presented as “discontinued operations” on the condensed consolidated statements of operations and comprehensive income for the three months ended December 31, 2016 and 2015. See Note 3 - Discontinued Operations for additional information. The notes to our condensed consolidated financial statements relate to our continuing operations only, unless otherwise indicated. Interim Financial Statements The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim information, and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, they do not include all of the information and notes required by U.S. GAAP for annual financial statements. In our opinion, the interim financial statements reflect all normal adjustments that are necessary to provide a fair presentation of the financial results for the interim periods presented. Operating results for interim periods are not necessarily indicative of results that may be expected for an entire fiscal year. The condensed consolidated balance sheet as of September 30, 2016 has been derived from the audited consolidated financial statements as of such date as adjusted for discontinued operations. See Note 3 - Discontinued Operations for additional information. For a more complete understanding of our business, financial position, operating results, cash flows, risk factors and other matters, please refer to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016.

Recent Accounting Pronouncements

3 Months Ended

Dec. 31, 2016

Accounting Policies [Abstract]

Recent Accounting Pronouncements

There have been no recent accounting pronouncements or changes in accounting pronouncements that are of significance, or of potential significance, to us other than those discussed below:

•

In November 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (ASU 2016-18), which provides amendments to current guidance to address the classification and presentation of changes in restricted cash or restricted cash equivalents. Specifically, there is no guidance to address how to classify and present changes in restricted cash or restricted cash equivalents that occur when there are transfers between cash, cash equivalents and restricted cash or restricted cash equivalents and when there are direct cash receipts into restricted cash or restricted cash equivalents. The new guidance is effective for annual periods beginning after December 15, 2017 and interim periods within those annual periods. The new standard will be effective for our fiscal year beginning October 1, 2018 and early adoption is permitted. We are currently evaluating the impact of this accounting standard update on our Consolidated Financial Statements.

•

In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 introduces targeted amendments intended to simplify the accounting for stock compensation. Specifically, the ASU requires all excess tax benefits and tax deficiencies (including tax benefits of dividends on share-based payment awards) to be recognized as income tax expense or benefit in the consolidated statement of operations and comprehensive income. The new guidance is effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. The new standard will be effective for our fiscal year beginning October 1, 2017 and early adoption is permitted. We are currently evaluating the impact of this accounting standard update on our Consolidated Financial Statements.

•

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). ASU 2016-02 introduces a lessee model that requires recognition of assets and liabilities arising from qualified leases on the consolidated balance sheets and disclosure of qualitative and quantitative information about lease transactions. This guidance is effective for fiscal years beginning after December 15, 2018 and interim periods within those years. The new standard will be effective for our fiscal year beginning October 1, 2019 and early adoption is permitted. We are currently evaluating the impact of this accounting standard update on our Consolidated Financial Statements.

•

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. This guidance is effective for fiscal years beginning after December 15, 2017. The new standard will be effective for our fiscal year beginning October 1, 2018 and earlier adoption is permitted. We are currently evaluating the impact of this accounting standard update on our Consolidated Financial Statements.

•

In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. This standard requires inventory to be measured at the lower of cost and net realizable value. The guidance clarifies that net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This guidance is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. The new standard will be effective for our fiscal year beginning October 1, 2017 and early adoption is permitted. We are currently evaluating the impact of this accounting standard update on our Consolidated Financial Statements.

•

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers which will supersede most current U.S. GAAP guidance on this topic. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing to clarify two aspects of the guidance within ASU No. 2014-09 on identifying performance obligations and the licensing implementation guidance. Under the new standards, recognition of revenue occurs when the seller satisfies a performance obligation by transferring to the customer promised goods or services in an amount that reflects the consideration the entity expects to receive for those goods or services. The new standard, as amended in August 2015, will be effective for our fiscal year beginning October 1, 2018 and early adoption is permitted as of October 1, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. The Company has not yet adopted a transition method nor has it determined the effect of the standard on our ongoing financial reporting.

Discontinued Operations

3 Months Ended

Dec. 31, 2016

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Sale of Photovoltaics Business

In the fiscal year ended September 30, 2015 EMCORE completed the sale of the company's Photovoltaics Business to SolAero pursuant to the Photovoltaics Agreement under which SolAero acquired substantially all of the assets, and assumed substantially all of the liabilities, primarily related to or used in connection with the Company's Photovoltaics Business for $149.9 million in cash.

On December 22, 2015, we settled all of the outstanding rights and obligations of a solar power venture in Spain, including outstanding non-current receivables, for a payment of $0.7 million. The outstanding non-current receivables had a net book value of $0 at the time of settlement as they were fully allowed for previously. The resulting gain was recorded in the discontinued operations of the Photovoltaics Business for the three months ended December 31, 2015.

The following table presents the statements of operations for the discontinued operations of the Photovoltaics Business:



	For the three months ended December 31,
(in thousands)	2016			2015
Revenue	$	—		$	—
Cost of revenue	—			—
Gross profit	—			—
Operating expense (income)	3			(787		)
(Loss) income from discontinued operations before income tax expense	(3		)	787
Income tax expense	—			(9		)
(Loss) income from discontinued operations, net of tax	$	(3	)	$	778

Included in discontinued operations of the Photovoltaics Business during the three months ended December 31, 2015 were $0.1 million of New Mexico incentive tax credits received. There were no incentive tax credits received during the three months ended December 31, 2016.

Sale of Digital Products Business

In the fiscal year ended September 30, 2015 EMCORE completed the sale of the company's Digital Products Business to NeoPhotonics pursuant to the Digital Products Agreement, under which NeoPhotonics acquired certain assets, and certain liabilities, related to the Company's Digital Products Business for an aggregate purchase price of $17.5 million.

In December 2015, we entered into an agreement to terminate our lease and related obligations associated with a facility in Newark, California which we abandoned effective February 2016 following the sale of the Digital Products Business. As a result of this agreement, we paid $0.2 million and recorded a gain of $0.3 million on the lease termination in the discontinued operations of the Digital Products Business during the three months ended December 31, 2015. See Note 8 - Accrued Expenses and Other Current Liabilities.

The following table presents the statements of operations for the discontinued operations of the Digital Products Business:



	For the three months ended December 31,
(in thousands)	2016			2015
Revenue	$	—		$	—
Cost of revenue	1			(49		)
Gross (loss) profit	(1		)	49
Operating expense (income)	5			(298		)
(Loss) income from discontinued operations before income tax expense	(6		)	347
Income tax expense	—			(4		)
(Loss) income from discontinued operations, net of tax	$	(6	)	$	343

There were no incentive tax credits received from the Digital Products Business during the three months ended December 31, 2016 and 2015.

- Definition

The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

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+ Details

Fair Value Accounting

3 Months Ended

Dec. 31, 2016

Fair Value Disclosures [Abstract]

Fair Value Accounting

Accounting Standards Codification (“ASC 820”), Fair Value Measurements, establishes a valuation hierarchy for disclosure of the inputs to valuation techniques used to measure fair value. This standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value:


•	Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities.


•	Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the assets or liabilities, either directly or indirectly, through market corroboration, for substantially the full term of the financial instrument.


•	Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets or liabilities at fair value.

Classification of an asset or liability within this hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs.

Cash consists primarily of bank deposits or highly liquid short-term investments with a maturity of three months or less at the time of purchase. Restricted cash represents temporarily restricted deposits held as compensating balances against short-term borrowing arrangements.

The carrying amounts of cash and cash equivalents, restricted cash, accounts receivable, other current assets, and accounts payable approximate fair value because of the short maturity of these instruments.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Accounts Receivable

3 Months Ended

Dec. 31, 2016

Receivables [Abstract]

Accounts Receivable

The components of accounts receivable consisted of the following:



	As of			As of
(in thousands)	December 31, 2016			September 30, 2016
Accounts receivable, gross	$	21,062		$	18,468
Allowance for doubtful accounts	(33		)	(36		)
Accounts receivable, net	$	21,029		$	18,432

The allowance for doubtful accounts is based on the age of receivables and a specific identification of receivables considered at risk of collection.

The following table summarizes changes in the allowance for doubtful accounts for the three months ended December 31, 2016 and 2015.



Allowance for Doubtful Accounts (in thousands)	For the Three Months Ended December 31,
	2016			2015
Balance at beginning of period	$	36		$	462
Provision adjustment - expense, net of recoveries	—			4
Write-offs and other adjustments - additions (deductions) to receivable balances	(3		)	(141		)
Balance at end of period	$	33		$	325

- Definition

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

+ References + Details

Inventory

3 Months Ended

Dec. 31, 2016

Inventory Disclosure [Abstract]

Inventory

The components of inventory consisted of the following:



	As of		As of
(in thousands)	December 31, 2016		September 30, 2016
Raw materials	$	16,515	$	16,095
Work in-process	6,996		5,687
Finished goods	8,252		5,899
Inventory balance at end of period	$	31,763	$	27,681
Current portion	$	28,198	$	24,150
Non-Current portion	3,565		3,531
Inventory balance at end of period	$	31,763	$	27,681

The non-current inventory balance of $3.6 million and $3.5 million as of December 31, 2016 and September 30, 2016, respectively, is comprised entirely of raw materials which we acquired as part of a last time purchase as a result of the vendor announcing they would cease manufacturing a part.

Property, Plant, and Equipment, net

3 Months Ended

Dec. 31, 2016

Property, Plant and Equipment [Abstract]

Property, Plant, and Equipment, net

The components of property, plant, and equipment, net consisted of the following:



	As of			As of
(in thousands)	December 31, 2016			September 30, 2016
Equipment	$	29,908		$	28,247
Furniture and fixtures	1,109			1,109
Computer hardware and software	2,856			2,860
Leasehold improvements	1,870			1,896
Construction in progress	2,622			1,779
Property, plant, and equipment, gross	38,365			35,891
Accumulated depreciation	(24,322		)	(23,678		)
Property, plant, and equipment, net	$	14,043		$	12,213

Accrued Expenses and Other Current Liabilities

3 Months Ended

Dec. 31, 2016

Payables and Accruals [Abstract]

Accrued Expenses and Other Current Liabilities

The components of accrued expenses and other current liabilities consisted of the following:



	As of		As of
(in thousands)	December 31, 2016		September 30, 2016
Compensation	$	2,858	$	3,628
Warranty	791		871
Professional fees	984		761
Customer deposits	39		38
Income and other taxes	1,083		944
Severance and restructuring accruals	710		642
Other	866		800
Accrued expenses and other current liabilities	$	7,331	$	7,684

Compensation: Compensation is primarily comprised of accrued employee salaries, taxes and benefits.

Income and other taxes: For the three months ended December 31, 2016, the Company recorded approximately $120,000 of income tax expense from continuing operations and $0 of income tax benefit within income from discontinued operations. For the three months ended December 31, 2015, the Company reported $2,000 of income tax expense from continuing operations losses and $13,000 of income tax expense within income from discontinued operations. The income tax expense within discontinued operations includes estimated alternative minimum tax and other adjustments prescribed by ASC 740 in allocating expected annual income tax expense (benefit) between continuing operations and discontinued operations.

Severance and restructuring accruals: In connection with the abandonment of our Newark, California facility following the closing of the sale of the Digital Products Business, we accrued for the remaining lease costs through the lease termination in May 2016. In December 2015, we entered into an agreement to terminate this lease and related obligations, including AROs (defined below), as of February 2016 for a payment of $0.2 million. As a result of the agreement, we recorded a gain of $0.3 million on the lease termination. The resulting gain was recorded in the discontinued operations of the Digital Products Business for the three months ended December 31, 2015. See Note 3 - Discontinued Operations.

On June 7, 2016, the Company's former Chief Financial Officer (¥“CFO”) notified the Company that he would resign as the Company's CFO, effective as of June 20, 2016 (the “Separation Date”). The Company and the former CFO entered into a separation agreement and general release, dated June 7, 2016 (the “Separation Agreement”), which includes mutual releases by the former CFO and the Company of all claims related to his employment and service relationship with, and termination of employment and service from, the Company. The Separation Agreement provides for, among other things, the continuation of his base salary for 64 weeks, benefits for 16 months, outplacement services for a period of not more than 1 year and with a value not in excess of $15,000 and immediate vesting of all his outstanding non-vested equity awards, other than his most recent equity award. These payments are not contingent upon any future service by the former CFO. The Company recorded a charge of approximately $0.4 million in the fiscal year ended September 30, 2016 related to this Separation Agreement.

In an effort to better align our current and future business operations, in May 2016 the Company announced a reduction in its workforce by approximately 30 individuals and recorded a charge for severance for the affected employees in the amount of $0.3 million in the fiscal year ended September 30, 2016. In November 2016, the Company announced an additional reduction in the workforce of approximately 5 individuals and recorded a charge of $0.2 million in the three months ended December 31, 2016 related to the outsourcing of our satellite communications assembly operations.

Our severance and restructuring-related accruals specifically relate to the separation agreements and reduction in force discussed above and non-cancelable obligations associated with an abandoned leased facility. Expense related to severance and restructuring accruals is included in selling, general, and administrative expense on our statement of operations and comprehensive income. The following table summarizes the changes in the severance accrual account:



(in thousands)	Severance-related accruals
Balance as of September 30, 2016	$	642
Expense - charged to accrual	172
Payments and accrual adjustments	(104		)
Balance as of December 31, 2016	$	710

Warranty: We generally provide product and other warranties on our components, power systems, and fiber optic products. Certain parts and labor warranties from our vendors can be assigned to our customers. Our reported financial position or results of operations may be materially different under changed conditions or when using different estimates and assumptions. In the event that estimates or assumptions prove to differ from actual results, adjustments are made in subsequent periods to reflect more current information.

The following table summarizes the changes in our product warranty accrual accounts:



Product Warranty Accruals	For the three months ended December 31,
(in thousands)	2016			2015
Balance at beginning of period	$	871		$	1,664
Provision for product warranty - expense	88			146
Adjustments and utilization of warranty accrual	(168		)	(246		)
Balance at end of period	$	791		$	1,564

Credit Facilities	3 Months Ended
Credit Facilities	Dec. 31, 2016
Debt Disclosure [Abstract]
Credit Facilities	Credit Facilities On November 11, 2010, we entered into a Credit and Security Agreement (the “Credit Facility”) with Wells Fargo Bank, N.A. (“Wells Fargo”). The Credit Facility is secured by the Company's assets and is subject to a borrowing base formula based on the Company's eligible accounts receivable, inventory, and machinery and equipment accounts. On November 10, 2015, we entered into a Seventh Amendment of the Credit Facility, which extended the maturity date of the facility to November 2018 and adjusted the interest rate to LIBOR plus 2.5%. The Credit Facility currently provides us with a revolving credit line of up to $15.0 million that can be used for working capital requirements, letters of credit, and other general corporate purposes. As of December 31, 2016, there were no amounts outstanding under this Credit Facility and the Company was in compliance with all financial covenants. Also, as of December 31, 2016, the Credit Facility had approximately $0.5 million reserved for one stand-by letter of credit and $9.8 million available for borrowing. As of February 1, 2017, there was no outstanding balance under this Credit Facility.

Income and other Taxes	3 Months Ended
Income and other Taxes	Dec. 31, 2016
Income Tax Disclosure [Abstract]
Income and other Taxes	Income and other Taxes During the three months ended December 31, 2016 and 2015, the Company recorded income tax expense from continuing operations of approximately $0.1 million and $2,000, respectively. For the three months ended December 31, 2016 and 2015, the Company recorded income tax expense from discontinued operations of approximately $0 and $13,000, respectively, within income from discontinued operations. Income tax expense is comprised of estimated alternative minimum tax allocated between continuing operations and discontinued operations as prescribed by ASC 740 and foreign tax expense included within continuing operations. For the three months ended December 31, 2016 and 2015, the effective tax rate on continuing operations was 6.4% and 1.5%, respectively. The higher tax rate for the three months ended December 31, 2016 was primarily due to permanent differences, state tax benefits, foreign tax rate differentials and changes in the Company's estimated results in the current year as compared to the prior year. The lower tax rate for the three months ended December 31, 2015 was primarily due to permanent differences, state tax benefits and foreign tax rate differentials. The Company uses estimates to forecast the results from continuing operations for the current fiscal year as well as permanent differences between book and tax accounting. We have not provided for U.S. federal and state income taxes on non-U.S. subsidiaries' undistributed earnings as of December 31, 2016 because we plan to indefinitely reinvest the unremitted earnings of our non-U.S. subsidiaries. All deferred tax assets have a full valuation allowance at December 31, 2016. However, on a quarterly basis, the Company will evaluate the positive and negative evidence to assess whether the more likely than not criteria, mandated by ASC 740, has been satisfied in determining whether there will be further adjustments to the valuation allowance. During the three months ended December 31, 2016 and 2015, there were no material increases or decreases in unrecognized tax benefits. As of December 31, 2016 and September 30, 2016, we had approximately $0.3 million of interest and penalties accrued as tax liabilities on our condensed consolidated balance sheet. The Company’s Board of Directors has adopted a Tax Benefits Preservation Plan (the “Rights Plan”) to help preserve the value of our net operating losses and tax credit carryforwards by reducing the risk of limitation of these deferred tax assets. The Rights Plan was approved by the Company’s shareholders on March 10, 2015. The Rights Plan is intended to reduce the likelihood that the Company will experience an ownership change for purposes of Internal Revenue Code Section 382 by discouraging any person or group from becoming a “5% shareholder” or increasing their ownership of the Company’s common stock if they are already a “5% shareholder.”

Commitments and Contingencies	3 Months Ended
Commitments and Contingencies	Dec. 31, 2016
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Operating Lease Obligations: We lease certain facilities and equipment under non-cancelable operating leases. Operating lease amounts exclude renewal option periods, property taxes, insurance, and maintenance expenses on leased properties. Our facility leases typically provide for rental adjustments for increases in base rent (up to specific limits), property taxes, insurance, and general property maintenance that would be recorded as rent expense. Rent expense was approximately $0.3 million for the three months ended December 31, 2016 and 2015. There are no off-balance sheet arrangements other than our operating leases. Asset Retirement Obligation: We have known conditional AROs, such as certain asset decommissioning and restoration of rented facilities to be performed in the future. Our ARO includes assumptions related to renewal option periods for those facilities where we expect to extend lease terms. The Company recognizes its estimate of the fair value of its ARO in the period incurred in long-term liabilities. The fair value of the ARO is also capitalized as property, plant and equipment. In future periods, the ARO is accreted for the change in its present value and capitalized costs are depreciated over the useful life of the related assets. If the fair value of the estimated ARO changes, an adjustment will be recorded to both the ARO and the asset retirement capitalized cost. Revisions in estimated liabilities can result from revisions of estimated inflation rates, changes in estimated retirement costs, and changes in the estimated timing of settling the ARO. The fair value of our ARO was estimated by discounting projected cash flows over the estimated life of the related assets using credit adjusted risk-free rates which ranged from 1.20% to 4.20%. There was no ARO settled during the three months ended December 31, 2016. See discussion below regarding ARO settlements during the three months ended December 31, 2015. Accretion expense of $17,000 and $15,000 was recorded during the three months ended December 31, 2016 and 2015, respectively. EMCORE leases its primary facility in Alhambra, California covering six buildings where manufacturing, research and development, and general and administrative work is performed. Several leases related to these facilities expired in 2011, and were being maintained on a month-to-month basis. In November 2014, a new lease for four of the six buildings was signed, which was retroactively effective on October 1, 2014. The new lease extended the terms of the lease for three years plus a three year option to extend the lease and clarified the obligations and restoration work necessary to restore the buildings back to the requirements in the lease. The Company’s ARO consists of legal requirements to return the existing leased facilities to their original state and certain environmental work to be performed due to the presence of a manufacturing fabrication operation and significant changes to the facilities over the past thirty years. During the three months ended December 31, 2015, the Company entered into an agreement to terminate the lease and related obligations, including ARO, in Newark, California for a one-time settlement payment of $0.2 million. As a result of this agreement and payment, the Company reduced its ARO associated with the Newark facility by $0.3 million. Indemnifications: We have agreed to indemnify certain customers against claims of infringement of intellectual property rights of others in our sales contracts with these customers. Historically, we have not paid any claims under these indemnification obligations. In March 2012, we entered into a Master Purchase Agreement with SEI, pursuant to which we agreed to sell certain assets and transfer certain obligations. Under the terms of the Master Purchase Agreement, we agreed to indemnify SEI for up to $3.4 million of potential claims and expenses for the two-year period following the sale and we recorded this amount as a deferred gain on our balance sheet as a result of these contingencies. On September 23, 2014, SEI filed for arbitration against EMCORE, in accordance with the terms of the Master Purchase Agreement between the parties. SEI was seeking $47.5 million from EMCORE, relating to numerous claims. On April 12, 2016, the International Court of Arbitration tribunal rejected SEI's claims. The panel ruled that EMCORE owed SEI none of the amounts SEI sought in the arbitration and that the Company was entitled to collect the $1.9 million held in escrow, which was received in June 2016. The Company was also entitled to recover $2.6 million in fees and costs from SEI, which was received in June 2016. During the fiscal year ended September 30, 2016, we recognized a gain associated with the release of $3.4 million of previously recorded gain associated with the sale of assets and reversal of other liabilities of $0.4 million, resulting in a credit of $3.8 million to recognition of previously deferred gain on sale of assets within discontinued operations of the Digital Products Business. During the fiscal year ended September 30, 2016, we recognized the $2.6 million recovery of previously incurred litigation fees and costs incurred by EMCORE within operating income as such represented the recovery of previously incurred legal expenses. See Note 3 - Discontinued Operations. Legal Proceedings: We are subject to various legal proceedings, claims, and litigation, either asserted or unasserted, that arise in the ordinary course of business. While the outcome of these matters is currently not determinable, we do not expect the resolution of these matters to have a material adverse effect on our business, financial position, results of operations, or cash flows. However, the results of these matters cannot be predicted with certainty. Professional legal fees are expensed when incurred. We accrue for contingent losses when such losses are probable and reasonably estimable. In the event that estimates or assumptions prove to differ from actual results, adjustments are made in subsequent periods to reflect more current information. Should we fail to prevail in any legal matter or should several legal matters be resolved against the Company in the same reporting period, then the financial results of that particular reporting period could be materially affected. a) Intellectual Property Lawsuits We protect our proprietary technology by applying for patents where appropriate and, in other cases, by preserving the technology, related know-how and information as trade secrets. The success and competitive position of our product lines are impacted by our ability to obtain intellectual property protection for our research and development efforts. We have, from time to time, exchanged correspondence with third parties regarding the assertion of patent or other intellectual property rights in connection with certain of our products and processes. b) Mirasol Class Action On December 15, 2015, Plaintiff Christina Mirasol (“Mirasol”), on her own behalf and on behalf of a putative class of similarly situated individuals composed of current and former non-exempt employees of the Company working in California since December 15, 2011, filed a complaint against the Company in the Superior Court of California, Los Angeles County. The complaint alleged seven causes of action related to: (1) failure to pay overtime; (2) failure to provide meal periods; (3) failure to pay minimum wages; (4) failure to timely pay wages upon termination; (5) failure to provide compliant wage statements; (6) unfair competition under the California Business and Professions Code § 17200 et seq.; and (7) penalties under the Private Attorneys General Act. The claims were premised primarily on the allegation that Mirasol and the putative class members were not provided with their legally required meal periods. Mirasol sought recovery on her own behalf and on behalf of the putative class in an unspecified amount for compensatory and liquidated damages as well as for declaratory relief, injunctive relief, statutory penalties, pre-judgment interest, costs and attorneys’ fees. In exchange for a one-time cash payment offered by the Company, certain current and former employees previously agreed to release the Company from all potential claims related to the matters alleged in the Mirasol lawsuit. The Company had recorded an accrual for these amounts at September 30, 2016 that was not material to the Company's results of operations, financial condition or cash flows, which had been recorded within Operating Expenses for the fiscal year ended September 30, 2016. On January 6, 2017, the Company and Mirasol agreed to a settlement of $0.3 million with regards to all claims outstanding. During the three months ended December 31, 2016, the Company recorded an accrual of $0.2 million within Operating Expenses related to the settlement. c) Mirasol Wrongful Termination Lawsuit In August 2016, EMCORE was served with a second lawsuit by former employee Mirsaol, in the Superior Court of Los Angeles alleging that the Company violated California’s employment laws in terminating her employment in November 2015. By her unverified Complaint, Mirasol asserted five causes of action: (1) wrongful termination in violation of public policy; (2) discrimination on the basis of disability and/or medical condition; (3) failure to accommodate; (4) failure to engage in the interactive process; and (5) intentional infliction of emotional distress. On September 26, 2016, Mirasol dismissed the fifth cause of action for intentional infliction of emotional distress. Mirasol alleged that EMCORE wrongfully terminated her at the conclusion of a Family and Medical Act leave, without engaging in the interactive process of offering to provide her with reasonable accommodations. The plaintiff sought general, special, and punitive damages. On January 6, 2017, the Company and Mirasol agreed to a settlement of $50,000 with regards to all outstanding claims. This amount was accrued as of December 31, 2016.

Equity

3 Months Ended

Dec. 31, 2016

Equity [Abstract]

Equity

Equity Plans

We provide long-term incentives to eligible officers, directors, and employees in the form of equity-based awards. We maintain three equity incentive compensation plans, collectively described below as our “Equity Plans”:


•	the 2000 Stock Option Plan,


•	the 2010 Equity Incentive Plan (“2010 Plan”), and


•	the 2012 Equity Incentive Plan (“2012 Plan”).

We issue new shares of common stock to satisfy awards issued under our Equity Plans.

Stock Options

Most of our stock options vest and become exercisable over a four to five year period and have a contractual life of 10 years. Certain stock options awarded are intended to qualify as incentive stock options pursuant to Section 422A of the Internal Revenue Code.

The following table summarizes stock option activity under the Equity Plans for the three months ended December 31, 2016:



	Number of Shares		Weighted Average Exercise Price	Weighted Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value (*) (in thousands)
Outstanding as of September 30, 2016	750,338		$16.84
Granted	—		—
Exercised	(26,151	)	$3.99		$	120
Forfeited	(1,300	)	$4.11
Expired	(124,915	)	$19.91
Outstanding as of December 31, 2016	597,972		$16.79	2.44	$	1,101
Exercisable as of December 31, 2016	531,911		$18.30	1.67	$	832
Vested and expected to vest as of December 31, 2016	586,261		$17.03	2.31	$	1,054

(*) Intrinsic value for stock options represents the “in-the-money” portion or the positive variance between a stock option's exercise price and the underlying stock price. For the three months ended December 31, 2015, the intrinsic value of options exercised was $80,000.

As of December 31, 2016, there was approximately $0.2 million of unrecognized stock-based compensation expense, net of estimated forfeitures, related to non-vested stock options granted under the Equity Plans which is expected to be recognized over an estimated weighted average life of 3.4 years.

Valuation Assumptions

There were no stock option grants for the three months ended December 31, 2016. The fair value of each stock option grant for the three months ended December 31, 2015, excluding the adjustment for the special dividend, was estimated on the date of grant using the Black-Scholes option valuation model, adhering to the straight-line attribution approach using the following weighted-average assumptions, of which the expected term and stock price volatility rate are highly subjective:



	For the three months ended December 31,
	2015
Black-Scholes weighted average assumptions:
Expected dividend rate	—		%
Expected stock price volatility rate	61.6		%
Risk-free interest rate	1.8		%
Expected term (in years)	6.0

Weighted average grant date fair value per share of stock options granted:	$	4.18

Expected Dividend Yield: The Black-Scholes valuation model calls for a single expected dividend rate as an input. Although we paid a special dividend in July 2016, no dividend rate was assumed in the valuation.

Expected Stock Price Volatility Rate: The fair values of stock-based payments were calculated using the Black-Scholes valuation method with a volatility factor based on our historical common stock prices.

Risk-Free Interest Rate: The risk-free interest rate used in the Black-Scholes valuation method was based on the implied yield that was available on U.S. Treasury zero-coupon notes with an equivalent remaining term. Where the expected terms of stock-based awards do not correspond with the terms for which interest rates are quoted, we performed a straight-line interpolation to determine the rate from the available maturities.

Expected Term: Expected term represents the period that our stock-based awards are expected to be outstanding and was determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior as influenced by changes to the terms of stock-based awards.

Estimated Pre-vesting Forfeitures: We are required to estimate forfeitures at the time of grant and revise those estimates in subsequent periods if actual forfeitures differ from those estimates. We use historical data to estimate pre-vesting option forfeitures and record stock-based compensation expense only for those awards that are expected to vest. If we use different assumptions for estimating stock-based compensation expense in future periods or if actual forfeitures differ materially from our estimated forfeitures, the change in our non-cash stock-based compensation expense could adversely affect our results of operations.

Restricted Stock

Restricted stock units (RSUs) granted to employees under the 2010 Plan and 2012 Plan typically vest over 3 to 4 years and are subject to forfeiture if employment terminates prior to the lapse of the restrictions. RSUs are not considered issued or outstanding common stock until they vest.

The following table summarizes the activity related to RSUs for the three months ended December 31, 2016:



Restricted Stock Activity	Restricted Stock Units
	Number of Shares		Weighted Average Grant Date Fair Value
Non-vested as of September 30, 2016	878,416		$4.25
Granted	145,919		$7.29
Vested	(5,206	)	$6.01
Forfeited	(933	)	$4.74
Non-vested as of December 31, 2016	1,018,196		$4.67

As of December 31, 2016, there was approximately $3.1 million of remaining unamortized stock-based compensation expense, net of estimated forfeitures, associated with RSUs, which will be expensed over a weighted average remaining service period of approximately 2.4 years. The 1.0 million outstanding non-vested RSUs have an aggregate intrinsic value of approximately $8.9 million and a weighted average remaining contractual term of 1.4 years. For the three months ended December 31, 2016 and 2015, the intrinsic value of RSUs vested was approximately $32,000 and $1,800, respectively. Of the 1.0 million outstanding non-vested RSUs at December 31, 2016, approximately 1.0 million are expected to vest and have an aggregate intrinsic value of approximately $8.4 million and a weighted average remaining contractual term of 1.3 years. For the three months ended December 31, 2015, the weighted average grant date fair value of RSUs granted was $7.82.

On October 18, 2016, the Company granted 70,000 RSUs with a grant date fair value of $0.4 million to its CEO, Jeffrey Rittichier, that will vest in 4 equal annual installments beginning on October 18, 2017.

Performance Stock

Performance based restricted stock units (PSUs) granted to employees under the 2012 Plan typically vest over 1 to 3 years and are subject to forfeiture if employment terminates prior to the lapse of the restrictions. PSUs are not considered issued or outstanding common stock until they vest. PSUs that are granted to our executive officers and key employees are provided as long-term incentive compensation that is based on relative total shareholder return, which measures our performance against that of our competitors.

On October 18, 2016, the Company granted our CEO, Mr. Rittichier, 100,000 target PSUs with a grant date fair value of $0.7 million and our CFO, Jikun Kim, 195,180 target PSUs with a grant date fair value of $1.4 million.

The PSUs issued will be based on a combination of the relative total shareholder return of EMCORE’S stock compared to the Russell Microcap Index and the executive's continued employment. The total number of shares to be issued to each individual ranges from zero (0) to 200% of the target PSUs granted. Between zero (0) and 200% of one third of the target PSUs will vest, if at all, on each of October 17, 2017, 2018 and 2019.

On December 14, 2016, the Company granted 71,669 target PSUs with a grant date fair value of $1.0 million to certain employees. The PSUs issued will vest based on a combination of the relative total shareholder return of EMCORE’s stock compared to the Russell Microcap Index and the employee's continued employment. The total number of shares to be issued to each individual may range from zero (0) to 200% of the target PSUs granted. Between zero (0) and 200% of the target PSUs will vest, if at all, on December 14, 2019.

The following table summarizes the activity related to PSUs for the three months ended December 31, 2016:



Performance Stock Activity	Performance Stock Units
	Number of Shares (at Target)	Weighted Average Grant Date Fair Value
Non-vested as of September 30, 2016	—	$0.00
Granted	366,849	$8.34
Vested	—	$0.00
Forfeited	—	$0.00
Non-vested as of December 31, 2016	366,849	$8.34

As of December 31, 2016, there was approximately $2.5 million of remaining unamortized stock-based compensation expense, net of estimated forfeitures, associated with PSUs, which will be expensed over a weighted average remaining service period of approximately 2.0 years. The 0.4 million outstanding non-vested PSUs have an aggregate intrinsic value of approximately $3.2 million and a weighted average remaining contractual term of 2.0 years. For the three months ended December 31, 2016 and 2015, there were no PSUs vested. Of the 0.4 million outstanding non-vested PSUs at December 31, 2016, approximately 0.3 million are expected to vest and have an aggregate intrinsic value of approximately $3.0 million and a weighted average remaining contractual term of 2.0 years. There were no PSUs granted during the three months ended December 31, 2015.

Stock-based compensation

The effect of recording stock-based compensation expense was as follows:



Stock-based Compensation Expense - by award type	For the three months ended December 31,
(in thousands)	2016		2015
Employee stock options	$	11	$	6
Restricted stock awards and units	354		266
Performance stock units	268		—
Employee stock purchase plan	52		55
Outside director fees in common stock	78		36
Total stock-based compensation expense	$	763	$	363



Stock-based Compensation Expense - by expense type	For the three months ended December 31,
(in thousands)	2016		2015
Cost of revenue	$	93	$	69
Selling, general, and administrative	570		188
Research and development	100		106
Total stock-based compensation expense	$	763	$	363

The stock-based compensation expense above relates to continuing operations. Stock-based compensation within selling, general and administrative expense was higher for three months ended December 31, 2016 due to stock-based compensation expense associated with the grants of PSUs. Included within discontinued operations is $9,000 and $24,000 of stock based compensation expense for the three months ended December 31, 2016 and 2015, respectively.

401(k) Plan

We have a savings plan that qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code. Under this savings plan, participating employees may defer a portion of their pretax earnings, up to the Internal Revenue Service annual contribution limit. Since June 2015, all employer contributions are made in cash. Our matching contribution in cash for the three months ended December 31, 2016 and 2015 was approximately $0.1 million.

Income (Loss) Per Share

The following table sets forth the computation of basic and diluted net income (loss) per share:



Basic and Diluted Net Income (Loss) Per Share	For the three months ended December 31,
(in thousands, except per share)	2016			2015

Numerator:
Income (loss) from continuing operations	$	1,766		$	(134	)
(Loss) income from discontinued operations	(9		)	1,121
Undistributed earnings allocated to common shareholders for basic and diluted net income per share	1,757			987
Denominator:
Denominator for basic net income per share - weighted average shares outstanding	26,279			25,697
Dilutive options outstanding, unvested stock units and ESPP	760			—
Denominator for diluted net income per share - adjusted weighted average shares outstanding	27,039			25,697

Net income per basic share:
Continuing operations	$	0.07		$	0.00
Discontinued operations	0.00			0.04
Net income per basic share	$	0.07		$	0.04

Net income (loss) per diluted share:
Continuing operations	$	0.07		$	0.00
Discontinued operations	0.00			$	0.04
Net income per diluted share	$	0.07		$	0.04
Weighted average antidilutive options, unvested restricted stock units and awards, unvested performance stock units and ESPP shares excluded from the computation	529			858

Average market price of common stock	$	6.88		$	6.93

For diluted income (loss) per share, the denominator includes all outstanding common shares and all potential dilutive common shares to be issued. For the three months ended December 31, 2016, we excluded 0.5 million of weighted average outstanding stock options, RSUs and PSUs from the calculation of diluted net income per share because their effect would have been anti-dilutive. The anti-dilutive stock options and unvested stock were excluded from the computation of diluted net income (loss) per share for the three months ended December 31, 2015 due to the Company incurring a net loss for that period.

Employee Stock Purchase Plan

We maintain an Employee Stock Purchase Plan (“ESPP”) that provides employees an opportunity to purchase common stock through payroll deductions. The ESPP is a 6-month duration plan with new participation periods beginning on February 25 and August 26 of each year. The purchase price is set at 85% of the average high and low market price of our common stock on either the first or last day of the participation period, whichever is lower, and annual contributions are limited to the lower of 10% of an employee's compensation or $25,000.

Future Issuances

As of December 31, 2016, we had common stock reserved for the following future issuances:



Future Issuances	Number of Common Stock Shares Available for Future Issuances
Exercise of outstanding stock options	597,972
Unvested restricted stock units	1,018,196
Unvested performance stock units	366,849
Purchases under the employee stock purchase plan	1,044,678
Issuance of stock-based awards under the Equity Plans	416,358
Purchases under the officer and director share purchase plan	88,741
Issuance of deferred stock-based awards under the Directors' Stock Award Plan, as amended	28,840
Total reserved	3,561,634

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section S99
-Paragraph 4
-Subparagraph (SAB Topic 4.E)
-URI http://asc.fasb.org/extlink&oid=27010918&loc=d3e74567-122707

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(29))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(31))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Name Accounting Standards Codification
-Glossary Preferred Stock
-URI http://asc.fasb.org/extlink&oid=6521494

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+ Details

Geographical Information

3 Months Ended

Dec. 31, 2016

Segment Reporting [Abstract]

Geographical Information

We evaluate our reportable segment pursuant to ASC 280, Segment Reporting. The Company's Chief Executive Officer is the chief operating decision maker and he assesses the performance of the operating segment and allocates resources to the segment based on its business prospects, competitive factors, net revenue, operating results, and other non-GAAP financial ratios. Based on this evaluation, the Company operates as a single reportable segment.

Revenue: The following tables set forth revenue by geographic region with revenue assigned to geographic regions based on our customers’ billing address.



Revenue by Geographic Region	For the three months ended December 31,
(in thousands)	2016		2015
United States	$	24,754	$	13,813
Asia	3,719		6,339
Europe	1,630		2,163
Other	73		175
Total revenue	$	30,176	$	22,490

Significant Customers: Significant customers are defined as customers representing greater than 10% of our consolidated revenue. Revenue from three of our significant customers represented 74% and 61% of our consolidated revenue for the three months ended December 31, 2016 and 2015, respectively.

Long-lived Assets: Long-lived assets consist of property, plant, and equipment. As of December 31, 2016 and September 30, 2016, approximately 37% and 38%, respectively, of our long-lived assets were located in the United States. The remaining long-lived assets are primarily located in China.

- 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.

+ References

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+ Details

Recent Accounting Pronouncements (Policies)

3 Months Ended

Dec. 31, 2016

Accounting Policies [Abstract]

Cash and Cash Equivalents

Cash consists primarily of bank deposits or highly liquid short-term investments with a maturity of three months or less at the time of purchase.

Restricted Cash

Restricted cash represents temporarily restricted deposits held as compensating balances against short-term borrowing arrangements.

Fair Value of Financial Instruments

ASC 820”), Fair Value Measurements, establishes a valuation hierarchy for disclosure of the inputs to valuation techniques used to measure fair value. This standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value:


•	Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities.


•	Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the assets or liabilities, either directly or indirectly, through market corroboration, for substantially the full term of the financial instrument.


•	Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets or liabilities at fair value.

Classification of an asset or liability within this hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs.

Recent Accounting Pronouncements

There have been no recent accounting pronouncements or changes in accounting pronouncements that are of significance, or of potential significance, to us other than those discussed below:

•

Receivables

The allowance for doubtful accounts is based on the age of receivables and a specific identification of receivables considered at risk of collection.

Costs Associated with Exit or Disposal Activities or Restructuring

Expense related to severance and restructuring accruals is included in selling, general, and administrative expense on our statement of operations and comprehensive income.

Asset Retirement Obligations

Asset Retirement Obligation: We have known conditional AROs, such as certain asset decommissioning and restoration of rented facilities to be performed in the future. Our ARO includes assumptions related to renewal option periods for those facilities where we expect to extend lease terms. The Company recognizes its estimate of the fair value of its ARO in the period incurred in long-term liabilities. The fair value of the ARO is also capitalized as property, plant and equipment.

In future periods, the ARO is accreted for the change in its present value and capitalized costs are depreciated over the useful life of the related assets. If the fair value of the estimated ARO changes, an adjustment will be recorded to both the ARO and the asset retirement capitalized cost. Revisions in estimated liabilities can result from revisions of estimated inflation rates, changes in estimated retirement costs, and changes in the estimated timing of settling the ARO.

Legal Costs

Professional legal fees are expensed when incurred. We accrue for contingent losses when such losses are probable and reasonably estimable.

Segment Reporting

Discontinued Operations (Tables)

3 Months Ended

Dec. 31, 2016

Photovoltaics Business [Member]

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Schedule of Discontinued Operations, Balance Sheet and Income Statement

The following table presents the statements of operations for the discontinued operations of the Photovoltaics Business:



	For the three months ended December 31,
(in thousands)	2016			2015
Revenue	$	—		$	—
Cost of revenue	—			—
Gross profit	—			—
Operating expense (income)	3			(787		)
(Loss) income from discontinued operations before income tax expense	(3		)	787
Income tax expense	—			(9		)
(Loss) income from discontinued operations, net of tax	$	(3	)	$	778

Digital Products Business [Member]

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Schedule of Discontinued Operations, Balance Sheet and Income Statement

The following table presents the statements of operations for the discontinued operations of the Digital Products Business:



	For the three months ended December 31,
(in thousands)	2016			2015
Revenue	$	—		$	—
Cost of revenue	1			(49		)
Gross (loss) profit	(1		)	49
Operating expense (income)	5			(298		)
(Loss) income from discontinued operations before income tax expense	(6		)	347
Income tax expense	—			(4		)
(Loss) income from discontinued operations, net of tax	$	(6	)	$	343

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

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-Name Accounting Standards Codification
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+ Details

Accounts Receivable (Tables)

3 Months Ended

Dec. 31, 2016

Receivables [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable

The following table summarizes changes in the allowance for doubtful accounts for the three months ended December 31, 2016 and 2015.



Allowance for Doubtful Accounts (in thousands)	For the Three Months Ended December 31,
	2016			2015
Balance at beginning of period	$	36		$	462
Provision adjustment - expense, net of recoveries	—			4
Write-offs and other adjustments - additions (deductions) to receivable balances	(3		)	(141		)
Balance at end of period	$	33		$	325

The components of accounts receivable consisted of the following:



	As of			As of
(in thousands)	December 31, 2016			September 30, 2016
Accounts receivable, gross	$	21,062		$	18,468
Allowance for doubtful accounts	(33		)	(36		)
Accounts receivable, net	$	21,029		$	18,432

Inventory (Tables)

3 Months Ended

Dec. 31, 2016

Inventory Disclosure [Abstract]

Schedule of Inventory

The components of inventory consisted of the following:



	As of		As of
(in thousands)	December 31, 2016		September 30, 2016
Raw materials	$	16,515	$	16,095
Work in-process	6,996		5,687
Finished goods	8,252		5,899
Inventory balance at end of period	$	31,763	$	27,681
Current portion	$	28,198	$	24,150
Non-Current portion	3,565		3,531
Inventory balance at end of period	$	31,763	$	27,681

Property, Plant, and Equipment, net (Tables)

3 Months Ended

Dec. 31, 2016

Property, Plant and Equipment [Abstract]

Schedule of Property, Plant and Equipment

The components of property, plant, and equipment, net consisted of the following:



	As of			As of
(in thousands)	December 31, 2016			September 30, 2016
Equipment	$	29,908		$	28,247
Furniture and fixtures	1,109			1,109
Computer hardware and software	2,856			2,860
Leasehold improvements	1,870			1,896
Construction in progress	2,622			1,779
Property, plant, and equipment, gross	38,365			35,891
Accumulated depreciation	(24,322		)	(23,678		)
Property, plant, and equipment, net	$	14,043		$	12,213

Accrued Expenses and Other Current Liabilities (Tables)

3 Months Ended

Dec. 31, 2016

Payables and Accruals [Abstract]

Schedule of Accrued Liabilities

The components of accrued expenses and other current liabilities consisted of the following:



	As of		As of
(in thousands)	December 31, 2016		September 30, 2016
Compensation	$	2,858	$	3,628
Warranty	791		871
Professional fees	984		761
Customer deposits	39		38
Income and other taxes	1,083		944
Severance and restructuring accruals	710		642
Other	866		800
Accrued expenses and other current liabilities	$	7,331	$	7,684

Schedule of Restructuring and Related Costs

The following table summarizes the changes in the severance accrual account:



(in thousands)	Severance-related accruals
Balance as of September 30, 2016	$	642
Expense - charged to accrual	172
Payments and accrual adjustments	(104		)
Balance as of December 31, 2016	$	710

Schedule of Product Warranty Accruals

The following table summarizes the changes in our product warranty accrual accounts:



Product Warranty Accruals	For the three months ended December 31,
(in thousands)	2016			2015
Balance at beginning of period	$	871		$	1,664
Provision for product warranty - expense	88			146
Adjustments and utilization of warranty accrual	(168		)	(246		)
Balance at end of period	$	791		$	1,564

Equity (Tables)

3 Months Ended

Dec. 31, 2016

Equity [Abstract]

Schedule of Stock Options Activity

The following table summarizes stock option activity under the Equity Plans for the three months ended December 31, 2016:



	Number of Shares		Weighted Average Exercise Price	Weighted Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value (*) (in thousands)
Outstanding as of September 30, 2016	750,338		$16.84
Granted	—		—
Exercised	(26,151	)	$3.99		$	120
Forfeited	(1,300	)	$4.11
Expired	(124,915	)	$19.91
Outstanding as of December 31, 2016	597,972		$16.79	2.44	$	1,101
Exercisable as of December 31, 2016	531,911		$18.30	1.67	$	832
Vested and expected to vest as of December 31, 2016	586,261		$17.03	2.31	$	1,054

Schedule of Valuation Assumptions

The fair value of each stock option grant for the three months ended December 31, 2015, excluding the adjustment for the special dividend, was estimated on the date of grant using the Black-Scholes option valuation model, adhering to the straight-line attribution approach using the following weighted-average assumptions, of which the expected term and stock price volatility rate are highly subjective:



	For the three months ended December 31,
	2015
Black-Scholes weighted average assumptions:
Expected dividend rate	—		%
Expected stock price volatility rate	61.6		%
Risk-free interest rate	1.8		%
Expected term (in years)	6.0

Weighted average grant date fair value per share of stock options granted:	$	4.18

Schedule of Restricted Stock Activity

The following table summarizes the activity related to RSUs for the three months ended December 31, 2016:



Restricted Stock Activity	Restricted Stock Units
	Number of Shares		Weighted Average Grant Date Fair Value
Non-vested as of September 30, 2016	878,416		$4.25
Granted	145,919		$7.29
Vested	(5,206	)	$6.01
Forfeited	(933	)	$4.74
Non-vested as of December 31, 2016	1,018,196		$4.67

Schedule of Performance Share Activity

The following table summarizes the activity related to PSUs for the three months ended December 31, 2016:



Performance Stock Activity	Performance Stock Units
	Number of Shares (at Target)	Weighted Average Grant Date Fair Value
Non-vested as of September 30, 2016	—	$0.00
Granted	366,849	$8.34
Vested	—	$0.00
Forfeited	—	$0.00
Non-vested as of December 31, 2016	366,849	$8.34

Schedule of Stock-based Compensation Expense - By Award Type

The effect of recording stock-based compensation expense was as follows:



Stock-based Compensation Expense - by award type	For the three months ended December 31,
(in thousands)	2016		2015
Employee stock options	$	11	$	6
Restricted stock awards and units	354		266
Performance stock units	268		—
Employee stock purchase plan	52		55
Outside director fees in common stock	78		36
Total stock-based compensation expense	$	763	$	363

Schedule Stock-based Compensation Expense - By Expense Type



Stock-based Compensation Expense - by expense type	For the three months ended December 31,
(in thousands)	2016		2015
Cost of revenue	$	93	$	69
Selling, general, and administrative	570		188
Research and development	100		106
Total stock-based compensation expense	$	763	$	363

Schedule of Earnings Per Share, Basic and Diluted

Income (Loss) Per Share

The following table sets forth the computation of basic and diluted net income (loss) per share:



Basic and Diluted Net Income (Loss) Per Share	For the three months ended December 31,
(in thousands, except per share)	2016			2015

Numerator:
Income (loss) from continuing operations	$	1,766		$	(134	)
(Loss) income from discontinued operations	(9		)	1,121
Undistributed earnings allocated to common shareholders for basic and diluted net income per share	1,757			987
Denominator:
Denominator for basic net income per share - weighted average shares outstanding	26,279			25,697
Dilutive options outstanding, unvested stock units and ESPP	760			—
Denominator for diluted net income per share - adjusted weighted average shares outstanding	27,039			25,697

Net income per basic share:
Continuing operations	$	0.07		$	0.00
Discontinued operations	0.00			0.04
Net income per basic share	$	0.07		$	0.04

Net income (loss) per diluted share:
Continuing operations	$	0.07		$	0.00
Discontinued operations	0.00			$	0.04
Net income per diluted share	$	0.07		$	0.04
Weighted average antidilutive options, unvested restricted stock units and awards, unvested performance stock units and ESPP shares excluded from the computation	529			858

Average market price of common stock	$	6.88		$	6.93

Schedule of Common Stock Reserved for Future Issuances

As of December 31, 2016, we had common stock reserved for the following future issuances:



Future Issuances	Number of Common Stock Shares Available for Future Issuances
Exercise of outstanding stock options	597,972
Unvested restricted stock units	1,018,196
Unvested performance stock units	366,849
Purchases under the employee stock purchase plan	1,044,678
Issuance of stock-based awards under the Equity Plans	416,358
Purchases under the officer and director share purchase plan	88,741
Issuance of deferred stock-based awards under the Directors' Stock Award Plan, as amended	28,840
Total reserved	3,561,634