0001104659-16-116199 | 10-Q | XBRL Viewer

Document and Entity Information - shares	9 Months Ended
Mar. 31, 2016	Apr. 22, 2016
Document and Entity Information
Entity Registrant Name	ACCURAY INC
Entity Central Index Key	0001138723
Document Type	10-Q
Document Period End Date	Mar. 31, 2016
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		80,924,480
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2016	Jun. 30, 2015
Current assets:
Cash and cash equivalents	$ 79,155	$ 79,551
Short-term investments	70,650	64,306
Restricted cash	1,080	3,734
Accounts receivable, net of allowance for doubtful accounts of $864 and $709 as of March 31, 2016 and June 30, 2015 respectively	89,319	77,727
Inventories	117,122	106,151
Prepaid expenses and other current assets	14,688	15,991
Deferred cost of revenue	8,632	6,869
Total current assets	380,646	354,329
Property and equipment, net	29,061	31,829
Goodwill	57,936	58,054
Intangible assets, net	9,599	15,564
Deferred cost of revenue	1,654	1,500
Other assets	11,124	5,497
Total assets	490,020	466,773
Current liabilities:
Accounts payable	21,737	13,096
Accrued compensation	20,534	21,934
Other accrued liabilities	23,415	18,720
Short-term debt	39,278
Customer advances	19,732	19,385
Deferred revenue	104,935	96,780
Total current liabilities	229,631	169,915
Long-term liabilities:
Long-term other liabilities	10,925	10,934
Deferred revenue	16,722	10,489
Long-term debt	170,395	199,655
Total liabilities	427,673	390,993
Commitments and contingencies (Note 5)
Stockholders' Equity:
Preferred stock, $0.001 par value; authorized: 5,000,000 shares; no shares issued and outstanding
Common stock, $0.001 par value; authorized: 200,000,000 shares as of March 31, 2016 and June 30, 2015, respectively; issued and outstanding: 80,924,480 and 79,477,838 shares at March 31, 2016 and June 30, 2015, respectively	81	79
Additional paid-in capital	476,165	471,430
Accumulated other comprehensive loss	(299)	(426)
Accumulated deficit	(413,600)	(395,303)
Total stockholders' equity	62,347	75,780
Total liabilities and stockholders' equity	$ 490,020	$ 466,773

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2016	Jun. 30, 2015
Condensed Consolidated Balance Sheets
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 864	$ 709
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized shares	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized shares	200,000,000	200,000,000
Common stock, issued shares	80,924,480	79,477,838
Common stock, outstanding shares	80,924,480	79,477,838

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015
Net revenue:
Products	$ 53,740	$ 46,361	$ 149,494	$ 127,026
Services	51,544	51,154	154,333	151,025
Total net revenue	105,284	97,515	303,827	278,051
Cost of revenue:
Cost of products	29,622	27,332	85,356	75,168
Cost of services	30,718	31,523	97,058	97,933
Total cost of revenue	60,340	58,855	182,414	173,101
Gross profit	44,944	38,660	121,413	104,950
Operating expenses:
Research and development	13,270	12,836	42,497	40,902
Selling and marketing	12,516	12,987	41,009	46,763
General and administrative	13,716	11,665	39,820	34,976
Total operating expenses	39,502	37,488	123,326	122,641
Income (loss) from operations	5,442	1,172	(1,913)	(17,691)
Other expense, net	(3,963)	(3,618)	(14,124)	(14,607)
Income (loss) before provision for income taxes	1,479	(2,446)	(16,037)	(32,298)
Provision for income taxes	723	521	2,260	2,311
Net income (loss)	$ 756	$ (2,967)	$ (18,297)	$ (34,609)
Net income (loss) per share
Basic (in dollars per share)	$ 0.01	$ (0.04)	$ (0.23)	$ (0.44)
Diluted (in dollars per share)	$ 0.01	$ (0.04)	$ (0.23)	$ (0.44)
Weighted average common shares used in computing loss per share
Basic (in shares)	80,860	78,746	80,320	77,981
Diluted (in shares)	82,071	78,746	80,320	77,981
Net income (loss)	$ 756	$ (2,967)	$ (18,297)	$ (34,609)
Foreign currency translation adjustment	796	(510)	69	(1,576)
Unrealized gain (loss) on investments, net of tax	149	54	59	(85)
Comprehensive income (loss)	$ 1,701	$ (3,423)	$ (18,169)	$ (36,270)

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Cash Flows From Operating Activities
Net loss	$ (18,297)	$ (34,609)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	13,644	14,864
Share-based compensation	9,446	10,504
Amortization of debt issuance costs	1,279	1,114
Amortization and accretion of discount and premium on investments	731	732
Accretion of interest on debt	5,155	5,377
Recovery of (provision for) bad debt, net	162	(71)
Provision for write-down of inventories	1,472	1,127
Loss on disposal of property and equipment	11	16
Loss on extinguishment of debt	965
Changes in assets and liabilities:
Restricted cash	2,475	(1,560)
Accounts receivable	(10,294)	7,446
Inventories	(11,335)	(24,540)
Prepaid expenses and other assets	(3,997)	3,137
Deferred cost of revenue	(1,941)	5,619
Accounts payable	8,724	(1,214)
Accrued liabilities	1,289	(8,054)
Customer advances	268	341
Deferred revenue	13,808	7,168
Net cash provided by (used in) operating activities	13,565	(12,603)
Cash Flows From Investing Activities
Purchases of property and equipment, net	(5,885)	(5,925)
Purchases of investments	(52,712)	(69,871)
Sales and maturities of investments	45,695	94,422
Net cash (used in) provided by investing activities	(12,902)	18,626
Cash Flows From Financing Activities
Proceeds from employee stock plans	2,950	5,207
Taxes paid related to net share settlement of equity awards	(3,045)	(495)
Payments made to note holders	(65,531)
Proceeds from debt, net of costs	64,632
Net cash (used in) provided by financing activities	(994)	4,712
Effect of exchange rate changes on cash and cash equivalents	(65)	(7,632)
Net (decrease) increase in cash and cash equivalents	(396)	3,103
Cash and cash equivalents at beginning of period	79,551	92,346
Cash and cash equivalents at end of period	$ 79,155	$ 95,449

Summary of Significant Accounting Policies

9 Months Ended

Mar. 31, 2016

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

1. Summary of Significant Accounting Policies

Description of Business

Accuray Incorporated (together with its subsidiaries, the “Company” or “Accuray”) is incorporated in Delaware and has its principal place of business in Sunnyvale, California. The Company designs, develops and sells advanced radiosurgery and radiation therapy systems for the treatment of tumors throughout the body. The Company has offices in the United States, Switzerland, China, Hong Kong and Japan and conducts its business worldwide.

Basis of Presentation and Principles of Consolidation

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

The accompanying condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and note disclosures have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair presentation of the periods presented. The results for the three and nine months ended March 31, 2016 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2016, or for any other future interim period or fiscal year.

These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and accompanying notes for the fiscal year ended June 30, 2015 included in the Company’s Annual Report on Form 10-K filed with the SEC on August 28, 2015. The Company’s significant accounting policies are described in Note 2 to those audited consolidated financial statements and there have been no material changes to such policies.

We reclassified the debt issuance costs from other assets in the prior year’s condensed consolidated balance sheet to long-term debt to conform to the current quarter presentation upon the adoption of ASU No. 2015-03 as discussed below.

Recent Accounting Standard Update Not Yet Effective

In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-09, Compensation-Stock Compensation (Topic 718). The new guidance simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The amendments in this standard are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted. The Company is currently evaluating the impact of the pending adoption of this guidance on its condensed consolidated financial statements and related disclosures.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). Under the new guidance, a lessee will be required to recognize assets and liabilities for all leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. This ASU requires additional disclosures. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The ASU requires adoption based upon a modified retrospective transition approach. Early adoption is permitted. The Company has not yet selected a transition method, has not yet determined whether it will elect early adoption and is currently evaluating the impact of the pending adoption of this ASU on its condensed consolidated financial statements and related disclosures.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers: Topic 606 (ASU 2014-09), to supersede nearly all existing revenue recognition guidance under GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, it is possible more judgments and estimates may be required within the revenue recognition process than required under existing GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. On July 9, 2015, FASB approved a one-year deferral of the effective period for ASU 2014-09. The standard will be effective for the Company for the first quarter of fiscal 2019, but entities will be permitted to early adopt the standard as of the original effective date, which would be the first quarter of fiscal 2018 for the Company. The Company may adopt either of two methods: (i) retrospective to each prior reporting period presented with the option to elect certain practical expedients as defined within ASU 2014-09; or (ii) retrospective with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application and providing certain additional disclosures as defined within ASU 2014-09. The Company has not yet selected a transition method, has not yet determined whether it will elect early adoption and is currently evaluating the impact of the pending adoption of ASU 2014-09 on its condensed consolidated financial statements and related disclosures.

Accounting Standard Update Recently Adopted

In April 2015, FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs. We adopted ASU 2015-03 in our fiscal third quarter, an amended standard simplifying the presentation of debt issuance costs as a direct deduction from the carrying value of the debt liability rather than showing the debt issuance costs as an asset. This ASU is effective for fiscal years beginning after December 2015, which would be effective the first quarter of fiscal 2017 for the Company. Early adoption is permitted under this ASU. Accordingly, we have applied the amendment retrospectively to the comparable period presented and it did not have a significant impact on our financial statements.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures at the date of the financial statements. Key estimates and assumptions made by the Company relate to revenue recognition, assessment of recoverability of goodwill and intangible assets, valuation of inventories, share-based compensation expense, income taxes, allowance for doubtful accounts, loss contingencies and corporate bonus expenses. Actual results could differ materially from those estimates.

Concentration of Credit and Other Risks

The Company’s cash, cash equivalents and investments are deposited with several major financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company has not experienced any losses in such accounts and does not believe that it is exposed to any significant risk of loss on these balances.

For the three and nine months ended March 31, 2016 and 2015, there were no customers that represented 10% or more of total net revenue. No customer accounted for more than 10% of the Company’s total accounts receivable as of March 31, 2016. One customer accounted for 18% of the Company’s total accounts receivable as of June 30, 2015.

Accounts receivable are typically not collateralized. The Company performs ongoing credit evaluations of its customers and maintains reserves for potential credit losses. Accounts receivable are deemed past due in accordance with the contractual terms of the agreement. Accounts receivable balances are charged against the allowance for doubtful accounts once collection efforts are unsuccessful.

Single source suppliers presently provide the Company with several components. In most cases, if a supplier was unable to deliver these components, the Company believes that it would be able to find other sources for these components subject to any regulatory qualifications, if required.

Revenue Recognition

The Company earns revenue from the sale of products and related services. The Company records revenues net of any value added or sales tax. For arrangements with multiple elements, the Company allocates arrangement fees to products and services based upon Vendor Specific Objective Evidence (“VSOE”) of fair value of the respective elements, Third-Party Evidence (“TPE”), or Best Estimate of Selling Price (“BESP”), using the relative selling price method.

Product and Service Revenue

The majority of product revenue is generated from sales of CyberKnife and TomoTherapy systems. If the Company is responsible for installation, the Company recognizes revenue after installation and acceptance of the system. Otherwise, revenue is recognized upon delivery, assuming all other revenue recognition criteria are met.

The Company offers systems with post-contract customer support (“PCS”), installation services, training and professional services. PCS includes planned and corrective maintenance services, software updates, bug fixes, as well as call-center support. Service revenue is generated primarily from PCS (warranty period services and post warranty services), installation services, training, parts and upgrades that are sold under service contracts and professional services. PCS revenue is deferred and recognized over the service period. Installation service revenue is recognized concurrent with system revenue. Training and professional service revenues that are not deemed essential to the functionality of the systems are recognized as such services are performed.

Costs associated with service revenue are expensed when incurred, except when those costs are related to parts or system upgrades where revenue recognition has been deferred. In those cases, the costs are deferred and are recognized over the period of revenue recognition.

Net Income (Loss) Per Common Share

Basic and diluted net income (loss) per share is computed by dividing net income (loss) attributable to stockholders by the weighted average number of common shares outstanding during the period.

A reconciliation of the numerator and denominator used in the calculation of basic and diluted net income (loss) per share follows (in thousands):

	Three Months Ended					Nine Months Ended
	March 31,					March 31,
	2016		2015			2016			2015
Numerator:
Net income (loss) used to compute basic and diluted net income (loss) per share	$	756	$	(2,967	)	$	(18,297	)	$	(34,609	)

Denominator:
Weighted average shares used to compute basic income (loss) per share	80,860		78,746			80,320			77,981
Weighted average effect of dilutive stock options	101		—			—			—
Weighted average effect of dilutive RSUs, PSUs and MSUs	610		—			—			—
Weighted average effect of 3.50% Series A convertible debt	500		—			—			—

Weighted average shares used to compute diluted net income (loss) per share	82,071		78,746			80,320			77,981

The potentially dilutive shares of the Company’s common stock resulting from the assumed exercise of outstanding stock options, the vesting of Restricted Stock Units (RSU), Market Stock Units (MSU) and Performance Stock Units (PSU), and the purchase of shares under the Employee Stock Purchase Program (ESPP), as determined under the treasury stock method, are excluded from the computation of diluted net loss per share because their effect would have been anti-dilutive. Additionally, the 3.75% Convertible Senior Notes due August 1, 2016 (the “3.75% Convertible Notes”), the 3.50% Convertible Senior Notes due February 1, 2018 (the “3.50% Convertible Notes”) and the 3.50% Series A Convertible Notes (the “3.50% Series A Convertible Notes”) due February 1, 2018 (together, the “Convertible Notes”) are included in the calculation of diluted net income per share only if their inclusion is dilutive. For the three months ended March 31, 2016, the potentially dilutive shares issuable upon the conversion of the 3.50% Series A Convertible Notes were included in the calculation of the diluted net income per share, while the dilutive shares issuable upon the conversion of the 3.50% Convertible Notes were excluded from the calculation of diluted net income per share as their inclusion would have been anti-dilutive. For the three months ended March 31, 2015, the potentially dilutive shares under the Convertible Notes were excluded from the calculation of diluted net loss per share as their inclusion would have been anti-dilutive. The following table sets forth all potentially dilutive securities excluded from the computation in the table above because their effect would have been anti-dilutive (in thousands):

	As of March 31,
	2016	2015
Stock options	1,981	2,645
RSUs, PSUs and MSUs	3,558	4,785
3.50% Convertible Notes	8,378	8,378
3.50% Series A Convertible Notes	—	5,639

	13,917	21,447

Outstanding Convertible Notes—Diluted Share Impact

The 3.75% Convertible Notes and 3.50% Series A Convertible Notes have an optional physical (share), cash or combination settlement feature and contain certain conditional conversion features. Due to the optional cash settlement feature and management’s intent to settle the principal amount thereof in cash, the conversion shares underlying the outstanding principal amount of the 3.75% Convertible Notes and the 3.50% Series A Convertible Notes, totaling approximately 3.9 million shares and 13.2 million shares, respectively, were not included in the potentially diluted share count table above. The Company’s average stock price did not exceed the conversion price of the 3.75% Convertible Notes as of March 31, 2016 and 2015, respectively. The 0.5 million potentially dilutive shares of the 3.50% Series A Convertible Notes as of March 31, 2015 included in the table above represent the premium over the principal amount due to the higher average share price above the conversion price. The number of premium shares included in the Company’s diluted share count will vary with fluctuations in the Company’s share price. Higher actual share prices result in a greater number of premium shares.

Segment Information

The Company has determined that it operates in only one segment, as it only reports profit and loss information on an aggregate basis to its chief operating decision maker. Revenue by geographic region is based on the shipping addresses of the Company’s customers. The following summarizes revenue by geographic region (in thousands):

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2016		2015		2016		2015
Americas	$	32,667	$	52,617	$	128,957	$	136,812
Europe, Middle East, India and Africa	43,643		21,055		102,461		78,086
Asia-Pacific	16,505		16,955		49,226		36,307
Japan	12,469		6,888		23,183		26,846

Total	$	105,284	$	97,515	$	303,827	$	278,051

Information regarding geographic areas in which the Company has long lived tangible assets is as follows (in thousands):

	March 31,		June 30,
	2016		2015
Americas	$	25,124	$	28,182
Europe, Middle East, India and Africa	652		929
Asia-Pacific	1,140		455
Japan	2,145		2,263

Total	$	29,061	$	31,829

Balance Sheet Components

9 Months Ended

Mar. 31, 2016

Balance Sheet Components

Balance Sheet Components

2. Balance Sheet Components

Financing receivables

A financing receivable is a contractual right to receive money, on demand or on fixed or determinable dates, that is recognized as an asset in the Company’s balance sheet. The Company’s financing receivables, consisting of its accounts receivable with contractual maturities of more than one year and capital leases, totaled $7.3 million and $1.6 million at March 31, 2016 and June 30, 2015, respectively, and are included in Other Assets in the condensed consolidated balance sheets. Of the $7.3 million in financing receivables at March 31, 2016, $3.7 million related to capital leases with customers while the remaining $3.6 million related to contractual maturities of more than one year. At June 30, 2015, the $1.6 million related to contractual maturities of more than one year with no capital leases. Due to the homogenous nature of the leasing transactions, the Company manages them on an aggregate basis when assessing and monitoring credit risk. The Company evaluates the credit quality of an obligor at lease inception and monitors credit quality over the term of the underlying transactions. The Company performs a credit analysis for all new customers and reviews payment history, current order backlog, financial performance of the customers and other variables that augment or mitigate the inherent credit risk of a particular transaction. Such variables include the underlying value and liquidity of the collateral, the essential use of the equipment, the term of the lease and the inclusion of credit enhancements, such as guarantees, letters of credit or security deposits. Accounts rated as low risk typically have the equivalent of a Moody’s rating of Baa3 or higher, while accounts rated as moderate risk generally have the equivalent of a Ba1 or lower. The Company classifies accounts as high risk when it considers the financing receivable to be impaired or when management believes there is a significant near-term risk of payments. As of March 31, 2016, the capital lease portion of the financing receivables was rated at a moderate risk. There was no allowance for doubtful accounts related to such financing receivables as of March 31, 2016 and June 30, 2015, respectively.

Inventories

Inventories consisted of the following (in thousands):

	March 31,		June 30,
	2016		2015
Raw materials	$	50,570	$	46,356
Work-in-process	20,445		15,445
Finished goods	46,107		44,350

Inventories	$	117,122	$	106,151

Property and equipment, net

Property and equipment, net consisted of the following (in thousands):

	March 31,			June 30,
	2016			2015
Furniture and fixtures	$	4,924		$	4,674
Computer and office equipment	12,502			11,808
Software	11,055			10,992
Leasehold improvements	21,202			19,428
Machinery and equipment	50,677			47,031
Construction in progress	4,239			8,273

	104,599			102,206
Less: Accumulated depreciation	(75,538		)	(70,377		)

Property and equipment, net	$	29,061		$	31,829

Depreciation expense related to property and equipment for the three and nine months ended March 31, 2016 was $2.6 million and $7.7 million, respectively. Depreciation expense related to property and equipment for the three and nine months ended March 31, 2015 was $2.9 million and $8.9 million, respectively.

Goodwill and Intangible Assets

9 Months Ended

Mar. 31, 2016

Goodwill and Intangible Assets

Goodwill and Intangible Assets

3. Goodwill and Intangible Assets

Goodwill

Activity related to goodwill consisted of the following (in thousands):

	Nine Months			Year
	Ended			Ended
	March 31,			June 30,
	2016			2015
Balance at the beginning of the period	$	58,054		$	58,091
Currency translation	(118		)	(37		)

Balance at the end of the period	$	57,936		$	58,054

In the second quarter of fiscal 2016, the Company performed its annual goodwill impairment test. Based on this analysis, the Company determined that there was no impairment to goodwill. The Company will continue to monitor its recorded goodwill for indicators of impairment.

Intangible Assets

The Company’s unamortized intangible assets associated with completed acquisitions at March 31, 2016 and June 30, 2015 are as follows (in thousands):

		March 31, 2016							June 30, 2015
		Gross							Gross
		Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Useful Lives	Amount		Amortization			Amount		Amount		Amortization			Amount
	(in years)
Developed technology	5 — 6	$	46,744	$	(37,145	)	$	9,599	$	46,700	$	(31,136	)	$	15,564

The Company did not identify any triggering events that would indicate potential impairment of its definite-lived intangible and long-lived assets as of March 31, 2016 and June 30, 2015.

Amortization expense related to intangible assets for the three and nine months ended March 31, 2016 and 2015 was $2.0 million and $6.0 million, respectively.

The estimated future amortization expense of purchased intangible assets as of March 31, 2016 is as follows (in thousands):

Year Ending June 30,	Amount
2016 (remaining 3 months)	$	1,988
2017	7,568
2018	43

	$	9,599

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

Financial Instruments

9 Months Ended

Mar. 31, 2016

Financial Instruments

Financial Instruments

4. Financial Instruments

The Company considers all highly liquid investments held at major banks, certificates of deposit and other securities with original maturities of three months or less to be cash equivalents.

The Company classifies all of its investments as available-for-sale at the time of purchase because management intends that these investments are available for current operations and includes these investments on its balance sheet as short-term investments. Investments with original maturities longer than three months include commercial paper, U.S. agency securities, non-U.S. government securities and investment-grade corporate debt securities. Investments classified as available-for-sale are recorded at fair market value with the related unrealized gains and losses included in accumulated other comprehensive income (loss), a component of stockholders’ equity. Realized gains and losses are recorded based on specific identification of each security’s cost basis.

The Company defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy contains three levels of inputs that may be used to measure fair value, as follows:

Level 1— Unadjusted quoted prices that are available in active markets for the identical assets or liabilities at the measurement date.

Level 2— Other observable inputs available at the measurement date, other than quoted prices included in Level 1, either directly or indirectly, including:

Quoted prices for similar assets or liabilities in active markets;

Quoted prices for identical or similar assets in non-active markets;

Inputs other than quoted prices that are observable for the asset or liability; and

Inputs that are derived principally from or corroborated by other observable market data.

Level 3— Unobservable inputs that cannot be corroborated by observable market data and require the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions.

The following tables summarize the amortized cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category for cash, cash equivalents and short-term investments (in thousands):

	March 31, 2016
								Estimated Market Value
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Cash and Cash Equivalents		Short-term Investments

Cash	$	78,885	$	—	$	—		$	78,885	$	—

Level 1
Money market funds	270		—		—			270		—

	270		—		—			270		—

Level 2
Commercial paper	11,435		—		—					11,435
U.S. agency securities	34,000		—		(13		)	—		33,987
U.S. treasury bills	3,994		—		—			—		3,994
Corporate notes	21,240		—		(6		)	—		21,234

	70,669		—		(19		)	—		70,650

Total	$	149,824	$	—	$	(19	)	$	79,155	$	70,650

	June 30, 2015
								Estimated Market Value
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Cash and Cash Equivalents		Short-term Investments

Cash	$	73,444	$	—	$	—		$	73,444	$	—

Level 1
Money market funds	6,107		—		—			6,107		—

	6,107		—		—			6,107		—

Level 2
Commercial paper	11,989		—		—			—		11,989
U.S. Agency securities	21,999		6		(14		)	—		21,991
Non-U.S. government securities	1,504		—		(3		)	—		1,501
Corporate notes	28,891		—		(66		)	—		28,825

	64,383		6		(83		)	—		64,306

Total	$	143,934	$	6	$	(83	)	$	79,551	$	64,306

Certain investments in the table above are classified as having Level 2 inputs because quoted prices in an active market are not readily accessible for those specific financial assets, or the Company may have relied on alternative pricing methods that do not rely exclusively on quoted prices to determine the fair value of the investments.

The Company had investments that were in an unrealized loss position as of March 31, 2016. The Company determined that (i) it does not have the intent to sell any of these investments and (ii) it is not likely that it will be required to sell any of these investments before recovery of the entire amortized cost basis. The Company reviews its investments quarterly to identify and evaluate investments that have an indication of possible impairment. As of March 31, 2016, the Company anticipates that it will recover the entire carrying value of such investments and has determined that no other-than-temporary impairments associated with credit losses were required to be recognized during the nine months ended March 31, 2016.

Contractual maturities of available-for-sale securities at March 31, 2016 were as follows (in thousands):

	March 31, 2016
	Amortized Cost		Fair Value
Due in 1 year or less	$	46,469	$	46,462
Due in 1-2 years	24,200		24,188

	$	70,669	$	70,650

The following table summarizes the carrying values and estimated fair values of our short-term and long-term debt (in thousands):

	March 31, 2016				June 30, 2015
	Carrying Value		Fair Value		Carrying Value		Fair Value
3.75% Convertible Notes	$	35,778	$	36,145	$	92,863	$	102,645
3.50% Convertible Notes	42,976		58,166		42,332		65,230
3.50% Series A Convertible Notes	66,062		91,633		64,460		102,760
Secured Loan	64,857		64,857		—		—

Total	$	209,673	$	250,801	$	199,655	$	270,635

The short-term and long-term debt is measured on a non-recurring basis using Level 2 inputs based upon observable inputs of the Company’s underlying stock price and the time value of the conversion option, since an observable quoted price of the Convertible Notes is not readily available.

- 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

Commitments and Contingencies	9 Months Ended
Commitments and Contingencies	Mar. 31, 2016
Commitments and Contingencies
Commitments and Contingencies	5. Commitments and Contingencies The Company’s contractual obligations were presented in the Annual Report on Form 10-K for the previous annual reporting period ended June 30, 2015. There has been no material changes outside of the ordinary course of business in those obligations during the nine months ended March 31, 2016. Litigation From time to time, the Company is involved in legal proceedings arising in the ordinary course of its business. The Company records a provision for a loss when it believes that it is both probable that a loss has been incurred and the amount can be reasonably estimated. Currently, management believes the Company does not have any probable and estimable losses related to any current legal proceedings and claims. Although occasional adverse decisions or settlements may occur, management does not believe that an adverse determination with respect to any of these claims would individually or in the aggregate materially and adversely affect the Company’s financial condition or operating results. For certain legal proceedings, management believes that there is a reasonable possibility that material losses may be incurred; however, the Company is unable to reasonably estimate a range of reasonably possible losses with respect to these matters. Litigation is inherently unpredictable and is subject to significant uncertainties, some of which are beyond the Company’s control. Should any of these estimates and assumptions change or prove to have been incorrect, the Company could incur significant charges related to legal matters that could have a material impact on its results of operations, financial position and cash flows. Rotary Systems On April 28, 2011, a former supplier to TomoTherapy, Rotary Systems Incorporated (“Rotary Systems”), filed suit in Minnesota state court, Tenth Judicial District, Anoka County, against TomoTherapy alleging misappropriation of trade secrets, as well as several other counts alleging various theories of injury. Rotary Systems alleges TomoTherapy misappropriated Rotary Systems’ trade secrets pertaining to a component previously purchased from Rotary Systems, which TomoTherapy now purchases from a different supplier. The suit alleges TomoTherapy improperly supplied the alleged trade secrets to its present supplier, Dynamic Sealing Technologies Inc. (also a named defendant in the suit). Rotary Systems has made an unspecified claim for damages of greater than $50,000. TomoTherapy moved to dismiss the case and, on August 29, 2011, the court granted the motion to dismiss with respect to all counts other than the count alleging misappropriation of trade secrets. On May 21, 2012, the court gave Rotary Systems sixty days to identify the alleged trade secrets with specificity or face dismissal of its claim with prejudice. The court held a hearing on September 20, 2012 to review Rotary Systems’ amended complaint. TomoTherapy filed a motion for summary judgment on the trade secret claim, the court ruled in favor of TomoTherapy on December 5, 2013, and Rotary Systems appealed. On December 22, 2014, the Minnesota Court of Appeals reversed the district court’s dismissal of Rotary Systems’ trade secrets claim and remanded it to the district court but affirmed the dismissal of Rotary Systems’ other claims. In late October 2015, a final scheduling order was confirmed for the remanded claims and the parties are currently in the process of conducting discovery. On April 19, 2016, the parties entered into a written settlement agreement resolving the lawsuit. A stipulation of dismissal dismissing all claim by all parties with prejudice is anticipated to be filed no later than May 25, 2016. Cowealth Medical On February 27, 2014, Cowealth Medical Holding Co., Ltd. (“Cowealth”), Accuray’s former distributor in China, submitted a request for binding arbitration with the International Chamber of Commerce International Court of Arbitration (“ICC”) alleging, among other matters, that Accuray breached its distributor agreement with Cowealth by wrongfully terminating Cowealth as its distributor and misappropriated certain of Cowealth’s confidential information. Cowealth was seeking damages of approximately $170.0 million and injunctive relief. Accuray filed counterclaims for damages of approximately $35.0 million. Accuray’s answer and counterclaim were submitted to the ICC on May 12, 2014, and Cowealth served its reply on June 27, 2014. A hearing was held in Hong Kong between January 26, 2015 and February 6, 2015. The parties filed closing submissions and reply closing submissions in March 2015. On October 29, 2015, the ICC ruled that Accuray was liable for certain damages and awarded Cowealth approximately $3.4 million. On November 27, 2015, Cowealth applied for a correction to the award to revise the amount of damages upwards to approximately $5.5 million. On January 21, 2016, the arbitrator granted Cowealth’s application for a correction on the grounds that the original award amount was a clerical error on the part of the arbitrator. Interest on the final award amount will accrue at a rate of 5% per annum starting 30 days after the date the corrected award was issued until payment. Accordingly, management recorded a charge of $3.4 million for the first fiscal quarter ending September 30, 2015, and an additional $2.1 million for the second fiscal quarter ending December 30, 2015. The parties filed cost submissions and reply cost submissions in December 2015. The ICC released the final award on February 12, 2016, which dealt with the parties’ claims for costs of the arbitration. Under the final award, the arbitrator awarded costs to Cowealth at a net amount of $2.4 million and rejected all other claims and requests. Prior to the ruling of the ICC, no accrual was established in the Company’s consolidated financial statements because management did not believe the likelihood of an award of damages or costs of arbitration to Cowealth was probable or estimable. In addition, the Company won several of its counterclaims including the right to be assigned the existing service contracts between Cowealth and Accuray customers, transfer to Accuray any regulatory clearances, licenses or permits obtained and held for the purposes of selling the CyberKnife System in China and deliver any consigned parts in their possession. Software License Indemnity Under the terms of the Company’s software license agreements with its customers, the Company agrees that in the event the software sold infringes upon any patent, copyright, trademark, or any other proprietary right of a third-party, it will indemnify its customer licensees against any loss, expense, or liability from any damages that may be awarded against its customer. The Company includes this infringement indemnification in all of its software license agreements and selected managed services arrangements. In the event the customer cannot use the software or service due to infringement and the Company cannot obtain the right to use, replace or modify the license or service in a commercially feasible manner so that it no longer infringes, then the Company may terminate the license and provide the customer a refund of the fees paid by the customer for the infringing license or service. The Company has not recorded any liability associated with this indemnification, as it is not aware of any pending or threatened actions that represent probable losses as of March 31, 2016.

Debt

9 Months Ended

Mar. 31, 2016

Debt

Debt

7. Debt

First Lien Senior Secured Term Loan due January 2021 (Secured Loan)

On January 11, 2016, the Company closed a $70.0 million first lien senior secured debt financing agreement with Cerberus Business Finance, LLC, an affiliate of Cerberus Capital Management, L.P (the “Secured Loan”). The proceeds of the loan are to be used to retire the 3.75% Convertible Notes at the earlier of August 2016 or when otherwise redeemed. The Secured Loan bears interest at a variable rate per annum equal to, at the Company’s option, (i) the LIBOR Rate for one month plus an applicable margin of 7.00% (subject to a LIBOR Rate floor of 1.00% per annum), or (ii) a Reference Rate, which is the higher of 1) 3.25%, 2) Federal Funds Rate plus 0.5%, 3) the LIBOR rate for 1 month plus 1%, and 4) the US Prime Rate as published in the Wall Street Journal, plus an applicable margin of 4.75% per annum. The loan is repayable in consecutive quarterly installments of $875,000 with the final payment due on the Final Maturity Date. The Secured Loan matures on the earlier of: (i) January 11, 2021 and (ii) the date that is 120 days prior to the scheduled maturity date of the 3.5% Convertible Notes maturing February 1, 2018 unless the Company has set aside specifically identifiable funds raised from new common equity or new debt equal to the then-outstanding principal amount of the 3.5% Convertible Notes. The net proceeds from the offering, after deducting the initial purchaser’s discount and commission and the related offering costs, were approximately $65.5 million. The offering costs of $3.1 million and the initial purchaser’s discount and commission of $1.4 million (both of which are recorded in Long-term Debt) are being amortized to interest expense using the effective interest method over five years. The Secured Loan is secured by first-priority liens on substantially all the assets of the Company.

The covenants in the Secured Loan include:

Secured leverage —defines the maximum amount of secured leverage that can be on the Company’s books at a given point in time calculated by the total secured debt divided by the last twelve months’ adjusted EBITDA;

Total leverage —defines the maximum amount of total leverage that can be on the Company’s books at a given point in time calculated by the total debt divided by the last twelve months’ adjusted EBITDA;

Fixed Charge Coverage Ratio — designed to ensure that the Company’s cash fixed charges are met with adequate free cash flow based on a minimum coverage ratio to be set and maintained;

Minimum EBITDA — defines the minimum amount of adjusted EBITDA the Company must maintain and generate;

Maximum CapEx — defines how much cash the Company can use annually to pursue capital projects, purchase PP&E and other related activities during the life of the loan; and

Affirmative and negative covenants — defines reporting requirements, subsidiary asset restrictions, dividend distribution and repayment requirements among other general requirements.

The Company may, at its election, repay the Secured Loan at any time and if so, the Company will be required to pay a prepayment premium of 2% if the Secured Loan is repaid or accelerated within the first year on the amount repaid and 1% if the Secured Loan is repaid or accelerated within the second year on the amount repaid.

3.75% Convertible Senior Notes due August 2016

On August 1, 2011, the Company issued the 3.75% Convertible Notes to certain qualified institutional buyers, or QIBs. The 3.75% Convertible Notes were offered and sold to the QIBs pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), or Rule 144A. The net proceeds from the $100 million offering, after deducting the initial purchaser’s discount and commission and the related offering costs, were approximately $96.1 million. The offering costs and the initial purchaser’s discount and commission (which are recorded in Long-term Debt) are both being amortized to interest expense using the effective interest method over five years. The 3.75% Convertible Notes bear interest at a rate of 3.75% per year, payable semi-annually in arrears in cash on February 1 and August 1 of each year, beginning on February 1, 2012. The 3.75% Convertible Notes will mature on August 1, 2016, unless earlier repurchased, redeemed or converted. A portion of these notes were redeemed in January 2016, as discussed further below.

The 3.75% Convertible Notes were issued under an Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee. Holders of the 3.75% Convertible Notes may convert their 3.75% Convertible Notes at any time on or after May 1, 2016 until the close of business on the business day immediately preceding the maturity date. Prior to May 1, 2016, holders of the 3.75% Convertible Notes may convert their 3.75% Convertible Notes only under the following circumstances: (1) during any calendar quarter after the calendar quarter ending September 30, 2011, and only during such calendar quarter, if the closing sale price of the Company’s common stock for each of 20 or more trading days in the 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter exceeds 130% of the conversion price in effect on the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading-day period (such five consecutive trading-day period, the “Note Measurement Period”) in which the trading price per $1,000 principal amount of 3.75% Convertible Notes for each trading day of that Note Measurement Period was equal to or less than 98% of the product of the closing sale price of shares of the Company’s common stock and the applicable conversion rate for such trading day; (3) if the Company calls any or all of the 3.75% Convertible Notes for redemption, at any time prior to the close of business on the business day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate transactions as described in the Indenture. Upon conversion by holders of the 3.75% Convertible Notes, the Company will have the right to pay or deliver, as the case may be, cash, shares of common stock of the Company or a combination thereof, at the Company’s election. At any time on or prior to the 33rd business day immediately preceding the maturity date, the Company may irrevocably elect to (a) deliver solely shares of common stock of the Company in respect of the Company’s conversion obligation or (b) pay cash up to the aggregate principal amount of the 3.75% Convertible Notes to be converted and pay or deliver, as the case may be, cash, shares of common stock of the Company or a combination thereof in respect of the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the 3.75% Convertible Notes being converted. The initial conversion rate is 105.5548 shares of the Company’s common stock per $1,000 principal amount of 3.75% Convertible Notes (which represents an initial conversion price of approximately $9.47 per share of the Company’s common stock). The conversion rate, and thus the conversion price, is subject to adjustment as further described below.

Holders of the 3.75% Convertible Notes who convert their 3.75% Convertible Notes in connection with a “make-whole fundamental change,” as defined in the Indenture, may be entitled to a make-whole premium in the form of an increase in the conversion rate. Additionally, in the event of a “fundamental change,” as defined in the Indenture, holders of the 3.75% Convertible Notes may require the Company to purchase all or a portion of their 3.75% Convertible Notes at a fundamental change repurchase price equal to 100% of the principal amount of 3.75% Convertible Notes, plus accrued and unpaid interest, if any, to, but not including, the fundamental change repurchase date.

Prior to the maturity date, the Company may redeem for cash all or a portion of the 3.75% Convertible Notes if the closing sale price of its common stock exceeds 130% of the applicable conversion price (the initial conversion price is approximately $9.47 per share of common stock) of such 3.75% Convertible Notes for at least 20 trading days during any consecutive 30 trading-day period (including the last trading day of such period).

In accordance with ASC 470-20, Debt with Conversion and Other Options, the Company separately accounts for the liability and equity conversion components of the 3.75% Convertible Notes. The principal amount of the liability component of the 3.75% Convertible Notes was $75.9 million as of the date of issuance based on the present value of its cash flows using a discount rate of 10%, our approximate borrowing rate at the date of the issuance for a similar debt instrument without the conversion feature. The carrying value of the equity conversion component was $24.1 million. A portion of the initial purchaser’s discount and commission and the offering costs totaling $0.9 million was allocated to the equity conversion component. The liability component is being accreted to the principal amount of the 3.75% Convertible Notes using the effective interest method over five years.

In January 2016, the Company repurchased approximately $63.4 million in aggregate principal amount of its 3.75% Convertible Senior Notes due August 2016 for $66.6 million in cash. As $63.4 million of the 3.75% Convertible Senior Notes were settled in cash, a total of 6.7 million potentially dilutive shares are no longer potentially outstanding from an EPS perspective, these shares were already noted in Note 1 above as being excluded due to being anti-dilutive in the current fiscal quarter of 2016. Following such transactions, approximately $44.7 million aggregate principal amount of the 3.50% Convertible Notes, approximately $36.6 million aggregate principal amount of the 3.75% Convertible Notes and approximately $70.3 million of the 3.50% Series A Convertible Notes remained outstanding. The Company recorded a charge in the third quarter of fiscal 2016 of approximately $1.0 million associated with the repurchase of the notes.

3.50% Convertible Senior Notes due February 2018

In February 2013, the Company issued $115.0 million aggregate principal amount of its 3.50% Convertible Notes to certain QIBs. The 3.50% Convertible Notes were offered and sold to the QIBs pursuant to Rule 144A. The net proceeds from the offering, after deducting the initial purchaser’s discount and commission and the related offering costs, were approximately $110.5 million. The offering costs and the initial purchaser’s discount and commission (which are recorded in Long-term Debt) are both being amortized to interest expense using the effective interest method over five years. The 3.50% Convertible Notes bear interest at a rate of 3.50% per year, payable semi-annually in arrears in cash on February 1 and August 1 of each year, which began on August 1, 2013. The 3.50% Convertible Notes will mature on February 1, 2018, unless earlier repurchased, redeemed or converted.

In April 2014, through a series of transactions, the Company refinanced approximately $70.3 million aggregate principal amount of the 3.50% Convertible Notes with approximately $70.3 million aggregate principal amount of the Company’s new 3.50% Series A Convertible Senior Notes due 2018 (the “3.50% Series A Convertible Notes”).

The 3.50% Convertible Notes were issued under an Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee. Holders of the 3.50% Convertible Notes may convert their 3.50% Convertible Notes at any time until the close of business on the business day immediately preceding the maturity date. The 3.50% Convertible Notes are convertible, as described below into common stock of the Company at an initial conversion rate equal to 187.6877 shares of common stock per $1,000 principal amount of the 3.50% Convertible Notes, which is equivalent to a conversion price of approximately $5.33 per share of common stock, subject to adjustment.

Holders of the 3.50% Convertible Notes who convert their 3.50% Convertible Notes in connection with a “make-whole fundamental change”, as defined in the Indenture, may be entitled to a make-whole premium in the form of an increase in the conversion rate. Additionally, in the event of a “fundamental change,” as defined in the Indenture, holders of the 3.50% Convertible Notes may require the Company to purchase all or a portion of their 3.50% Convertible Notes at a fundamental change repurchase price equal to 100% of the principal amount of 3.50% Convertible Notes, plus accrued and unpaid interest, if any, to, but not including, the fundamental change repurchase date.

In accordance with guidance in ASC 470-20, Debt with Conversion and Other Options and ASC 815-15, Embedded Derivatives, the Company determined that the embedded conversion components of the 3.50% Convertible Note do not require bifurcation and separate accounting. The remaining $44.7 million principal amount of the 3.50% Convertible Note has been recorded in Long-term Debt on the condensed consolidated balance sheet as of March 31, 2016.

3.50% Series A Convertible Senior Notes due February 2018

On April 17, 2014, the Company entered into note exchange agreements with certain holders (the “Participating Holders”) of the 3.50% Convertible Notes to refinance approximately $70.3 million aggregate principal amount of the 3.50% Convertible Notes with approximately $70.3 million aggregate principal amount of the 3.50% Series A Convertible Notes. Pursuant to the note exchange agreements, the Company also paid the Participating Holders an aggregate of approximately $0.4 million in cash in connection with such transactions. The principal amount of 3.50% Convertible Notes refinanced for each $1,000 principal amount of the 3.50% Series A Convertible Notes was $1,000 and the amount in cash paid per $1,000 principal amount of such 3.50% Convertible Notes delivered was determined in individual negotiations between the Company and each Participating Holder. The Series A Convertible Notes have the same interest rate, maturity and other terms as the 3.50% Convertible Notes, except that the 3.50% Series A Convertible Notes are convertible into cash, shares of the Company’s common stock or a combination of cash and shares of common stock, at the Company’s option.

The 3.50% Series A Convertible Notes were issued under an Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee. Holders of the 3.50% Series A Convertible Notes may convert their Securities at any time on or after November 1, 2017 until the close of business on the business day immediately preceding the maturity date. Prior to November 1, 2017, holders of the 3.50% Series A Convertible Notes may convert their Securities only under the following circumstances: (1) during any calendar quarter after the calendar quarter ending September 30, 2014, and only during such calendar quarter, if the closing sale price of the Company’s common stock for each of 20 or more trading days in the 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter exceeds 130% of the conversion price in effect on the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading-day period (such five consecutive trading-day period, the “Note Measurement Period”) in which the trading price per $1,000 principal amount of 3.50% Series A Convertible Notes for each trading day of that Securities Measurement Period was equal to or less than 98% of the product of the closing sale price of shares of the Company’s common stock and the applicable conversion rate for such trading day; or (3) upon the occurrence of specified corporate transactions as described in the Indenture. Upon conversion by holders of the 3.50% Series A Convertible Notes, the Company will have the right to pay or deliver, as the case may be, cash, shares of common stock of the Company or a combination thereof, at the Company’s election. At any time on or prior to the 17th business day immediately preceding the maturity date, the Company may irrevocably elect to (a) deliver solely shares of common stock of the Company in respect of the Company’s conversion obligation or (b) pay cash up to the aggregate principal amount of the 3.50% Series A Convertible Notes to be converted and pay or deliver, as the case may be, cash, shares of common stock of the Company or a combination thereof in respect of the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the 3.50% Series A Convertible Notes being converted. The initial conversion rate is 187.6877 shares of the Company’s common stock per $1,000 principal amount of 3.50% Series A Convertible Notes (which represents an initial conversion price of approximately $5.33 per share of the Company’s common stock). The conversion rate, and thus the conversion price, is subject to adjustment as further described below.

Holders of the 3.50% Series A Convertible Notes who convert their Notes in connection with a “make-whole fundamental change”, as defined in the Indenture, may be entitled to a make-whole premium in the form of an increase in the conversion rate. Additionally, in the event of a “fundamental change,” as defined in the Indenture, holders of the 3.50% Series A Convertible Notes may require the Company to purchase all or a portion of their 3.50% Convertible Notes at a fundamental change repurchase price equal to 100% of the principal amount of the 3.50% Series A Convertible Notes, plus accrued and unpaid interest, if any, to, but not including, the fundamental change repurchase date.

In accordance with Accounting Standards Codification, or ASC 470-20, Debt with Conversion and Other Options, the Company separately accounts for the liability and equity conversion components of the 3.50% Series A Convertible Notes. The principal amount of the liability component of the 3.50% Series A Convertible Notes was $62.5 million as of the date of issuance based on the present value of its cash flows using a discount rate of 7%, our approximate borrowing rate at the date of the issuance for a similar debt instrument without the conversion feature. The carrying value of the equity conversion component was $7.9 million. In addition, the portion of the cash amount paid to the Participating Holders totaling $0.4 million was allocated to the debt discount with the remaining $47,000 to the equity component. The liability component is being accreted to the principal amount of the 3.50% Series A Convertible Notes using the effective interest method through the maturity in February 2018.

The following table presents the carrying values of all Convertible Notes and notes issued pursuant to the Secured Loan (collectively, “Notes”) as of March 31, 2016 (in thousands):

	Secured Loan			3.75% Convertible Notes			3.50% Convertible Notes			3.50% Series A Convertible Notes			Total
Carrying amount of the equity conversion component	$	—		$	19,670		$	—		$	7,844		$	27,514

Principal amount of the Notes	$	69,125		$	36,608		$	44,654		$	70,346		$	220,733
Unamortized debt costs	(2,938		)	(104		)	(1,678		)	—			(4,720		)
Unamortized debt discount	(1,330		)	(726		)	—			(4,284		)	(6,340		)

Net carrying amount	$	64,857		$	35,778		$	42,976		$	66,062		$	209,673

A summary of interest expense on the Notes is as follows (in thousands):

	Three months ended March 31,				Nine months ended March 31,
	2016		2015		2016		2015
Interest expense related to contractual interest coupon	$	2,677	$	1,944	$	6,612	$	5,832
Interest expense related to amortization of debt discount	1,285		1,837		5,155		5,377
Interest expense related to amortization of debt issuance costs	508		383		1,279		1,114

	$	4,470	$	4,164	$	13,046	$	12,323

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Mar. 31, 2016

Basis of Presentation and Principles of Consolidation

Use of Estimates

Concentration of Credit and Other Risks

Revenue Recognition

Product and Service Revenue

Net Income (Loss) Per Common Share

Basic and diluted net income (loss) per share is computed by dividing net income (loss) attributable to stockholders by the weighted average number of common shares outstanding during the period.

A reconciliation of the numerator and denominator used in the calculation of basic and diluted net income (loss) per share follows (in thousands):

	Three Months Ended					Nine Months Ended
	March 31,					March 31,
	2016		2015			2016			2015
Numerator:
Net income (loss) used to compute basic and diluted net income (loss) per share	$	756	$	(2,967	)	$	(18,297	)	$	(34,609	)

Denominator:
Weighted average shares used to compute basic income (loss) per share	80,860		78,746			80,320			77,981
Weighted average effect of dilutive stock options	101		—			—			—
Weighted average effect of dilutive RSUs, PSUs and MSUs	610		—			—			—
Weighted average effect of 3.50% Series A convertible debt	500		—			—			—

Weighted average shares used to compute diluted net income (loss) per share	82,071		78,746			80,320			77,981

	As of March 31,
	2016	2015
Stock options	1,981	2,645
RSUs, PSUs and MSUs	3,558	4,785
3.50% Convertible Notes	8,378	8,378
3.50% Series A Convertible Notes	—	5,639

	13,917	21,447

Outstanding Convertible Notes - Diluted Share Impact

Outstanding Convertible Notes—Diluted Share Impact

Segment Information

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2016		2015		2016		2015
Americas	$	32,667	$	52,617	$	128,957	$	136,812
Europe, Middle East, India and Africa	43,643		21,055		102,461		78,086
Asia-Pacific	16,505		16,955		49,226		36,307
Japan	12,469		6,888		23,183		26,846

Total	$	105,284	$	97,515	$	303,827	$	278,051

Information regarding geographic areas in which the Company has long lived tangible assets is as follows (in thousands):

	March 31,		June 30,
	2016		2015
Americas	$	25,124	$	28,182
Europe, Middle East, India and Africa	652		929
Asia-Pacific	1,140		455
Japan	2,145		2,263

Total	$	29,061	$	31,829

Recent Accounting Standard Update Not Yet Effective

Accounting Standard Updates

Recent Accounting Standard Update Not Yet Effective

Accounting Standard Update Recently Adopted

Accounting Standard Updates

Accounting Standard Update Recently Adopted

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Mar. 31, 2016

Summary of Significant Accounting Policies

Schedule of reconciliation of the numerator and denominator used in the calculation of basic and diluted loss per share

A reconciliation of the numerator and denominator used in the calculation of basic and diluted net income (loss) per share follows (in thousands):

	Three Months Ended					Nine Months Ended
	March 31,					March 31,
	2016		2015			2016			2015
Numerator:
Net income (loss) used to compute basic and diluted net income (loss) per share	$	756	$	(2,967	)	$	(18,297	)	$	(34,609	)

Denominator:
Weighted average shares used to compute basic income (loss) per share	80,860		78,746			80,320			77,981
Weighted average effect of dilutive stock options	101		—			—			—
Weighted average effect of dilutive RSUs, PSUs and MSUs	610		—			—			—
Weighted average effect of 3.50% Series A convertible debt	500		—			—			—

Weighted average shares used to compute diluted net income (loss) per share	82,071		78,746			80,320			77,981

Schedule of all potentially dilutive securities excluded from the computation of net loss per share

The following table sets forth all potentially dilutive securities excluded from the computation in the table above because their effect would have been anti-dilutive (in thousands):

	As of March 31,
	2016	2015
Stock options	1,981	2,645
RSUs, PSUs and MSUs	3,558	4,785
3.50% Convertible Notes	8,378	8,378
3.50% Series A Convertible Notes	—	5,639

	13,917	21,447

Summary of revenue by geographic region

The following summarizes revenue by geographic region (in thousands):

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2016		2015		2016		2015
Americas	$	32,667	$	52,617	$	128,957	$	136,812
Europe, Middle East, India and Africa	43,643		21,055		102,461		78,086
Asia-Pacific	16,505		16,955		49,226		36,307
Japan	12,469		6,888		23,183		26,846

Total	$	105,284	$	97,515	$	303,827	$	278,051

Schedule of geographic areas in which the Company has long lived tangible assets

Information regarding geographic areas in which the Company has long lived tangible assets is as follows (in thousands):

	March 31,		June 30,
	2016		2015
Americas	$	25,124	$	28,182
Europe, Middle East, India and Africa	652		929
Asia-Pacific	1,140		455
Japan	2,145		2,263

Total	$	29,061	$	31,829

Balance Sheet Components (Tables)

9 Months Ended

Mar. 31, 2016

Balance Sheet Components

Schedule of inventories

Inventories consisted of the following (in thousands):

	March 31,		June 30,
	2016		2015
Raw materials	$	50,570	$	46,356
Work-in-process	20,445		15,445
Finished goods	46,107		44,350

Inventories	$	117,122	$	106,151

Schedule of property and equipment, net

Property and equipment, net consisted of the following (in thousands):

	March 31,			June 30,
	2016			2015
Furniture and fixtures	$	4,924		$	4,674
Computer and office equipment	12,502			11,808
Software	11,055			10,992
Leasehold improvements	21,202			19,428
Machinery and equipment	50,677			47,031
Construction in progress	4,239			8,273

	104,599			102,206
Less: Accumulated depreciation	(75,538		)	(70,377		)

Property and equipment, net	$	29,061		$	31,829

Goodwill and Intangible Assets (Tables)

9 Months Ended

Mar. 31, 2016

Goodwill and Intangible Assets

Schedule of goodwill

Activity related to goodwill consisted of the following (in thousands):

	Nine Months			Year
	Ended			Ended
	March 31,			June 30,
	2016			2015
Balance at the beginning of the period	$	58,054		$	58,091
Currency translation	(118		)	(37		)

Balance at the end of the period	$	57,936		$	58,054

Schedule of intangible assets associated with completed acquisitions

The Company’s unamortized intangible assets associated with completed acquisitions at March 31, 2016 and June 30, 2015 are as follows (in thousands):

		March 31, 2016							June 30, 2015
		Gross							Gross
		Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Useful Lives	Amount		Amortization			Amount		Amount		Amortization			Amount
	(in years)
Developed technology	5 — 6	$	46,744	$	(37,145	)	$	9,599	$	46,700	$	(31,136	)	$	15,564

Schedule of estimated future amortization expense of purchased intangible assets

The estimated future amortization expense of purchased intangible assets as of March 31, 2016 is as follows (in thousands):

Year Ending June 30,	Amount
2016 (remaining 3 months)	$	1,988
2017	7,568
2018	43

	$	9,599

Financial Instruments (Tables)

9 Months Ended

Mar. 31, 2016

Financial Instruments

Summary of amortized cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category for cash, cash equivalents and short-term investments

	March 31, 2016
								Estimated Market Value
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Cash and Cash Equivalents		Short-term Investments

Cash	$	78,885	$	—	$	—		$	78,885	$	—

Level 1
Money market funds	270		—		—			270		—

	270		—		—			270		—

Level 2
Commercial paper	11,435		—		—					11,435
U.S. agency securities	34,000		—		(13		)	—		33,987
U.S. treasury bills	3,994		—		—			—		3,994
Corporate notes	21,240		—		(6		)	—		21,234

	70,669		—		(19		)	—		70,650

Total	$	149,824	$	—	$	(19	)	$	79,155	$	70,650

	June 30, 2015
								Estimated Market Value
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Cash and Cash Equivalents		Short-term Investments

Cash	$	73,444	$	—	$	—		$	73,444	$	—

Level 1
Money market funds	6,107		—		—			6,107		—

	6,107		—		—			6,107		—

Level 2
Commercial paper	11,989		—		—			—		11,989
U.S. Agency securities	21,999		6		(14		)	—		21,991
Non-U.S. government securities	1,504		—		(3		)	—		1,501
Corporate notes	28,891		—		(66		)	—		28,825

	64,383		6		(83		)	—		64,306

Total	$	143,934	$	6	$	(83	)	$	79,551	$	64,306

Schedule of contractual maturities of available-for-sale securities

Contractual maturities of available-for-sale securities at March 31, 2016 were as follows (in thousands):

	March 31, 2016
	Amortized Cost		Fair Value
Due in 1 year or less	$	46,469	$	46,462
Due in 1-2 years	24,200		24,188

	$	70,669	$	70,650

Summary of carrying values and estimated fair values of short-term and long-term debt

The following table summarizes the carrying values and estimated fair values of our short-term and long-term debt (in thousands):

	March 31, 2016				June 30, 2015
	Carrying Value		Fair Value		Carrying Value		Fair Value
3.75% Convertible Notes	$	35,778	$	36,145	$	92,863	$	102,645
3.50% Convertible Notes	42,976		58,166		42,332		65,230
3.50% Series A Convertible Notes	66,062		91,633		64,460		102,760
Secured Loan	64,857		64,857		—		—

Total	$	209,673	$	250,801	$	199,655	$	270,635

Debt (Tables)

9 Months Ended

Mar. 31, 2016

Debt

Schedule of carrying value of Notes

The following table presents the carrying values of all Convertible Notes and notes issued pursuant to the Secured Loan (collectively, “Notes”) as of March 31, 2016 (in thousands):

	Secured Loan			3.75% Convertible Notes			3.50% Convertible Notes			3.50% Series A Convertible Notes			Total
Carrying amount of the equity conversion component	$	—		$	19,670		$	—		$	7,844		$	27,514

Principal amount of the Notes	$	69,125		$	36,608		$	44,654		$	70,346		$	220,733
Unamortized debt costs	(2,938		)	(104		)	(1,678		)	—			(4,720		)
Unamortized debt discount	(1,330		)	(726		)	—			(4,284		)	(6,340		)

Net carrying amount	$	64,857		$	35,778		$	42,976		$	66,062		$	209,673

Summary of interest expense on Notes

A summary of interest expense on the Notes is as follows (in thousands):

	Three months ended March 31,				Nine months ended March 31,
	2016		2015		2016		2015
Interest expense related to contractual interest coupon	$	2,677	$	1,944	$	6,612	$	5,832
Interest expense related to amortization of debt discount	1,285		1,837		5,155		5,377
Interest expense related to amortization of debt issuance costs	508		383		1,279		1,114

	$	4,470	$	4,164	$	13,046	$	12,323

Summary of Significant Accounting Policies Securities (Details) - USD ($) shares in Thousands, $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Jan. 31, 2016	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015	Jun. 30, 2015	Apr. 17, 2014	Feb. 28, 2013	Aug. 01, 2011
Numerator:
Net income (loss) used to compute basic and diluted net income (loss) per share		$ 756	$ (2,967)	$ (18,297)	$ (34,609)
Denominator:
Weighted average shares used to compute basic income (loss) per share		80,860	78,746	80,320	77,981
Weighted average shares used to compute diluted net income (loss) per share		82,071	78,746	80,320	77,981
Anti-dilutive securities excluded from the computation of diluted net loss per share (in shares)				13,917	21,447
3.75% Convertible Notes
Denominator:
Weighted average effect of convertible debt	6,700
Interest rate (as a percent)	3.75%	3.75%		3.75%		3.75%			3.75%
Conversion shares outstanding principal amount excluded in the potentially diluted shares				3,900
3.50% Convertible Notes
Denominator:
Anti-dilutive securities excluded from the computation of diluted net loss per share (in shares)				8,378	8,378
Interest rate (as a percent)	3.50%	3.50%		3.50%		3.50%		3.50%
3.50% Series A Convertible Notes
Denominator:
Weighted average effect of convertible debt		500
Anti-dilutive securities excluded from the computation of diluted net loss per share (in shares)					5,639
Interest rate (as a percent)	3.50%	3.50%		3.50%		3.50%	3.50%
Conversion shares outstanding principal amount excluded in the potentially diluted shares				13,200
Stock options
Denominator:
Weighted average effect of dilutive awards		101
Anti-dilutive securities excluded from the computation of diluted net loss per share (in shares)				1,981	2,645
RSUs, PSUs and MSUs
Denominator:
Weighted average effect of dilutive awards		610
Anti-dilutive securities excluded from the computation of diluted net loss per share (in shares)				3,558	4,785

Balance Sheet Components (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Balance Sheet Components (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015	Jun. 30, 2015
Financing receivables
Financing receivables	$ 7,300		$ 7,300		$ 1,600
Capital leases	3,700		3,700		0
Accounts receivable with contractual maturities of more than one year	3,600		3,600		1,600
Allowance for doubtful accounts related to financing receivables	0		0		0
Inventories
Raw materials	50,570		50,570		46,356
Work-in-process	20,445		20,445		15,445
Finished goods	46,107		46,107		44,350
Total inventories	117,122		117,122		106,151
Property and equipment, net
Property and equipment, gross	104,599		104,599		102,206
Less: Accumulated depreciation	(75,538)		(75,538)		(70,377)
Property and equipment, net	29,061		29,061		31,829
Depreciation expense	2,600	$ 2,900	7,700	$ 8,900
Furniture and fixtures
Property and equipment, net
Property and equipment, gross	4,924		4,924		4,674
Computer and office equipment
Property and equipment, net
Property and equipment, gross	12,502		12,502		11,808
Software
Property and equipment, net
Property and equipment, gross	11,055		11,055		10,992
Leasehold improvements
Property and equipment, net
Property and equipment, gross	21,202		21,202		19,428
Machinery and equipment
Property and equipment, net
Property and equipment, gross	50,677		50,677		47,031
Construction in progress
Property and equipment, net
Property and equipment, gross	$ 4,239		$ 4,239		$ 8,273

Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended		12 Months Ended
	Mar. 31, 2016	Dec. 31, 2015	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015	Jun. 30, 2015
Changes in the carrying amount of goodwill
Balance at the beginning of the period				$ 58,054	$ 58,091	$ 58,091
Currency translation				(118)		(37)
Balance at the end of the period	$ 57,936			57,936		58,054
Impairment of goodwill		$ 0
Net Amount	9,599			9,599
Amortization expense	2,000		$ 2,000	6,000	$ 6,000
Estimated future amortization expense of purchased intangible assets
2016 (remaining 3 months)	1,988			1,988
2017	7,568			7,568
2018	43			43
Net Amount	9,599			9,599
Developed technology
Changes in the carrying amount of goodwill
Gross Carrying Amount	46,744			46,744		46,700
Accumulated Amortization	(37,145)			(37,145)		(31,136)
Net Amount	9,599			9,599		15,564
Estimated future amortization expense of purchased intangible assets
Net Amount	$ 9,599			$ 9,599		$ 15,564
Developed technology \| Minimum
Changes in the carrying amount of goodwill
Useful Lives				5 years		5 years
Developed technology \| Maximum
Changes in the carrying amount of goodwill
Useful Lives				6 years		6 years

Financial Instruments Investment (Details) - USD ($) $ in Thousands	9 Months Ended
	Mar. 31, 2016	Jun. 30, 2015	Mar. 31, 2015	Jun. 30, 2014
Cash, cash equivalents and short-term investments
Amortized Cost	$ 149,824	$ 143,934
Gross Unrealized Gains		6
Gross Unrealized Losses	(19)	(83)
Available-for-sale Securities	70,650
Cash and Cash Equivalents	79,155	79,551	$ 95,449	$ 92,346
Short-term investments	70,650	64,306
Other-than-temporary impairments associated with credit losses	0
Amortized Cost
Due in 1 year or less	46,469
Due in 1-2 years	24,200
Total Amortized Cost	70,669
Fair Value
Due in 1 year or less	46,462
Due in 1-2 years	24,188
Available-for-sale Securities	70,650
Cash.
Cash, cash equivalents and short-term investments
Amortized Cost	78,885	73,444
Cash and Cash Equivalents	78,885	73,444
Level 1
Cash, cash equivalents and short-term investments
Amortized Cost	270	6,107
Cash and Cash Equivalents	270	6,107
Level 1 \| Money market funds
Cash, cash equivalents and short-term investments
Amortized Cost	270	6,107
Cash and Cash Equivalents	270	6,107
Level 2
Cash, cash equivalents and short-term investments
Amortized Cost	70,669	64,383
Gross Unrealized Gains		6
Gross Unrealized Losses	(19)	(83)
Short-term investments	70,650	64,306
Level 2 \| Commercial paper
Cash, cash equivalents and short-term investments
Amortized Cost	11,435	11,989
Short-term investments	11,435	11,989
Level 2 \| U.S. agency securities
Cash, cash equivalents and short-term investments
Amortized Cost	34,000	21,999
Gross Unrealized Gains		6
Gross Unrealized Losses	(13)	(14)
Short-term investments	33,987	21,991
Level 2 \| U.S. treasury bills
Cash, cash equivalents and short-term investments
Amortized Cost	3,994
Short-term investments	3,994
Level 2 \| Non-U.S. government securities
Cash, cash equivalents and short-term investments
Amortized Cost		1,504
Gross Unrealized Losses		(3)
Short-term investments		1,501
Level 2 \| Corporate notes
Cash, cash equivalents and short-term investments
Amortized Cost	21,240	28,891
Gross Unrealized Losses	(6)	(66)
Short-term investments	$ 21,234	$ 28,825

Debt (Details) - USD ($) $ / shares in Units, shares in Thousands				1 Months Ended			3 Months Ended		9 Months Ended
	Jan. 11, 2016	Apr. 17, 2014	Aug. 01, 2011	Jan. 31, 2016	Apr. 30, 2014	Feb. 28, 2013	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015	Jun. 30, 2015
Debt
Net carrying amount							$ 209,673,000		$ 209,673,000
Carrying amount of the equity conversion component							27,514,000		27,514,000
Principal amount of the Notes							220,733,000		220,733,000
Unamortized debt costs							(4,720,000)		(4,720,000)
Unamortized debt discount							(6,340,000)		(6,340,000)
Interest expense related to contractual interest coupon							2,677,000	$ 1,944,000	6,612,000	$ 5,832,000
Interest expense related to amortization of debt discount							1,285,000	1,837,000	5,155,000	5,377,000
Interest expense related to amortization of debt issuance costs							508,000	383,000	1,279,000	1,114,000
Total interest expense recognized							4,470,000	$ 4,164,000	13,046,000	$ 12,323,000
Secured Loan
Debt
Aggregate principal amount of debt issued	$ 70,000,000
Quarterly installment payment	875,000
Proceeds from debt, net of costs	65,500,000
Offering costs	3,100,000
Initial purchaser's discount and commission	$ 1,400,000
Amortization period	5 years
EBITDA Monitoring Period	12 months
Prepayment premium if loan repaid or accelerated within the first year	2.00%
Prepayment premium if loan repaid or accelerated within the second year	1.00%
Net carrying amount							64,857,000		64,857,000
Principal amount of the Notes							69,125,000		69,125,000
Unamortized debt costs							(2,938,000)		(2,938,000)
Unamortized debt discount							(1,330,000)		$ (1,330,000)
Secured Loan \| Option (ii)
Debt
Interest rate (as a percent)	3.25%
Secured Loan \| Maximum \| 3.50% Convertible Notes
Debt
Debt instrument maturity before reference instrument maturity date	120 days
Secured Loan \| One month LIBOR \| Option (i)
Debt
Margin on interest rate	7.00%
Secured Loan \| One month LIBOR \| Option (ii)
Debt
Margin on interest rate	1.00%
Secured Loan \| LIBOR \| Minimum \| Option (i)
Debt
Interest rate (as a percent)	1.00%
Secured Loan \| Federal Funds Rate \| Option (ii)
Debt
Margin on interest rate	0.50%
Secured Loan \| US Prime Rate \| Option (ii)
Debt
Margin on interest rate	4.75%
3.75% Convertible Note and 3.50% Convertible Note
Debt
Charge associated with repurchase of notes							$ 1,000,000
3.75% Convertible Notes
Debt
Aggregate principal amount of debt issued			$ 100,000,000
Interest rate (as a percent)			3.75%	3.75%			3.75%		3.75%		3.75%
Proceeds from debt, net of costs			$ 96,100,000
Amortization period			5 years
Debt issuance costs, amortization period			5 years
Number of consecutive trading days during which the closing price of the entity's common stock must exceed the conversion price for at least 20 days in order for the notes to be convertible into common stock									30 days
Number of consecutive business days immediately after any five consecutive trading day period during the note measurement period									5 days
Number of consecutive trading days before five consecutive business days during the note measurement period									5 days
Principal amount used for debt instrument conversion ratio							$ 1,000		$ 1,000
Number of working days preceding maturity date for delivery of shares or payment of cash									33 days
Conversion rate, number of shares to be issued per $1000 of principal amount (in shares)									105.5548
Conversion price (in dollars per share)							$ 9.47		$ 9.47
Repurchase price, as percentage of principal amount, if company undergoes change of control									100.00%
Number of consecutive trading days during which the closing price of the entity's common stock must exceed the conversion price for at least 20 days in order for the notes to be redeemable									30 days
Net carrying amount			$ 75,900,000				$ 35,778,000		$ 35,778,000
Discount rate on liability component (as a percent)			10.00%
Carrying amount of the equity conversion component			$ 24,100,000				19,670,000		19,670,000
Debt issuance costs and discount allocated to equity conversion component			$ 900,000
Principal amount of the Notes retired				$ 63,400,000
Cash paid to Participating Holders in connection with debt refinancing				$ 66,600,000
Potentially dilutive shares outstanding				6,700
Principal amount of the Notes				$ 36,600,000			36,608,000		36,608,000
Unamortized debt costs							(104,000)		(104,000)
Unamortized debt discount							$ (726,000)		$ (726,000)
3.75% Convertible Notes \| Minimum
Debt
Number of days within 30 consecutive trading days in which the closing price of the entity's common stock must exceed the conversion price for the notes to be convertible into common stock									20 days
Percentage of the closing sales price of the entity's common stock that the conversion price must exceed in order for the notes to be convertible									130.00%
Percentage of the closing sales price of the entity's common stock that the conversion price must exceed in order for the notes to be redeemable									130.00%
Number of days within 30 consecutive trading days in which the closing price of the entity's common stock must exceed the conversion price for the notes to be redeemable									20 days
3.75% Convertible Notes \| Maximum
Debt
Percentage of the trading price to the product of the sale price of the entity's common stock and the conversion rate									98.00%
3.50% Convertible Notes
Debt
Aggregate principal amount of debt issued						$ 115,000,000
Interest rate (as a percent)				3.50%		3.50%	3.50%		3.50%		3.50%
Proceeds from debt, net of costs						$ 110,500,000
Debt issuance costs, amortization period						5 years
Principal amount used for debt instrument conversion ratio							$ 1,000		$ 1,000
Conversion rate, number of shares to be issued per $1000 of principal amount (in shares)									187.6877
Conversion price (in dollars per share)							$ 5.33		$ 5.33
Repurchase price, as percentage of principal amount, if company undergoes change of control									100.00%
Net carrying amount							$ 42,976,000		$ 42,976,000
Principal amount of the Notes				$ 44,700,000			44,654,000		44,654,000
Aggregate principal amount of debt refinanced					$ 70,300,000
Conversion rate, amount of debt to be issued per $1000 of principal amount		$ 1,000
Unamortized debt costs							$ (1,678,000)		$ (1,678,000)
3.50% Series A Convertible Notes
Debt
Aggregate principal amount of debt issued		$ 70,300,000
Interest rate (as a percent)		3.50%		3.50%			3.50%		3.50%		3.50%
Number of consecutive trading days during which the closing price of the entity's common stock must exceed the conversion price for at least 20 days in order for the notes to be convertible into common stock									30 days
Percentage of the closing sales price of the entity's common stock that the conversion price must exceed in order for the notes to be convertible									130.00%
Number of consecutive business days immediately after any five consecutive trading day period during the note measurement period									5 days
Number of consecutive trading days before five consecutive business days during the note measurement period									5 days
Principal amount used for debt instrument conversion ratio							$ 1,000		$ 1,000
Number of working days preceding maturity date for delivery of shares or payment of cash									17 days
Conversion rate, number of shares to be issued per $1000 of principal amount (in shares)									187.6877
Conversion price (in dollars per share)							$ 5.33		$ 5.33
Net carrying amount							$ 66,062,000		$ 66,062,000
Discount rate on liability component (as a percent)									7.00%
Carrying amount of the equity conversion component							$ 7,844,000		$ 7,844,000
Potentially dilutive shares outstanding							500
Principal amount of the Notes				$ 70,300,000			$ 70,346,000		$ 70,346,000
Payment to the convertible note holders to modify the notes		$ 400,000
Repurchase price, as a percentage of the principal amount, in the event of a fundamental change, as defined in Indenture									100.00%
Portion of cash amount paid allocated to debt discount							400,000		$ 400,000
Portion of cash amount paid allocated to equity component							47,000		47,000
Unamortized debt discount							$ (4,284,000)		$ (4,284,000)
3.50% Series A Convertible Notes \| Minimum
Debt
Number of days within 30 consecutive trading days in which the closing price of the entity's common stock must exceed the conversion price for the notes to be convertible into common stock									20 days
3.50% Series A Convertible Notes \| Maximum
Debt
Percentage of the trading price to the product of the sale price of the entity's common stock and the conversion rate									98.00%

Summary of Significant Accounting Policies Concentration Risk (Details) - Credit concentration risk - Major customers - customer	3 Months Ended		9 Months Ended	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Jun. 30, 2015
Total accounts receivable
Concentration of Credit Risk and Other Risks and Uncertainties
Number of significant customers			0
Percentage of concentration risk				18.00%
Total accounts receivable \| Minimum
Concentration of Credit Risk and Other Risks and Uncertainties
Percentage of concentration risk			10.00%
Total net revenue
Concentration of Credit Risk and Other Risks and Uncertainties
Number of significant customers	0	0
Total net revenue \| Minimum
Concentration of Credit Risk and Other Risks and Uncertainties
Percentage of concentration risk	10.00%	10.00%

Commitments and Contingencies (Details) - USD ($)								3 Months Ended
Commitments and Contingencies (Details) - USD ($)	Feb. 12, 2016	Jan. 21, 2016	Nov. 27, 2015	Oct. 29, 2015	Feb. 27, 2014	May 21, 2012	Apr. 28, 2011	Dec. 31, 2015	Sep. 30, 2015	Feb. 11, 2016
Rotary Systems
Contingencies
Period to identify alleged trade secrets with specificity or face dismissal of claim with prejudice						60 days
Rotary Systems \| Minimum
Contingencies
Claim for damages							$ 50,000
Cowealth Medical
Contingencies
Claim for damages					$ 170,000,000
Awarded value for the damages	$ 2,400,000			$ 3,400,000
Percentage of interest on awarded amount		5.00%
Period for interest not accrued after date of award		30 days
Recorded charge for awarded amount								$ 2,100,000	$ 3,400,000
Additional amount recorded			$ 5,500,000
Accrual amount of litigation										$ 0
Cowealth Medical \| Parent Company
Contingencies
Counterclaim for damages filed by the company					$ 35,000,000

Share-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Share-Based Compensation (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015
Share-based compensation charges
Share-based compensation expense	$ 3,567	$ 3,377	$ 9,446	$ 10,504
Cost of revenue
Share-based compensation charges
Share-based compensation expense	448	456	1,270	1,411
Research and development
Share-based compensation charges
Share-based compensation expense	717	658	1,888	2,356
Selling and marketing
Share-based compensation charges
Share-based compensation expense	714	739	2,116	2,225
General and administrative
Share-based compensation charges
Share-based compensation expense	$ 1,688	$ 1,524	$ 4,172	$ 4,512

Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Jun. 30, 2015
Accumulated Other Comprehensive Loss
Net unrealized gain (loss) on short-term investments	$ 1,237	$ (77)
Cumulative foreign currency translation adjustment	(19)	1,168
Defined benefit pension obligation	(1,517)	(1,517)
Accumulated other comprehensive loss	$ (299)	$ (426)

Summary of Significant Accounting Policies Segments (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Mar. 31, 2016 USD ($)	Mar. 31, 2015 USD ($)	Mar. 31, 2016 USD ($) segment	Mar. 31, 2015 USD ($)	Jun. 30, 2015 USD ($)
Segment Information
Number of operating segments \| segment			1
Revenue	$ 105,284	$ 97,515	$ 303,827	$ 278,051
Long lived assets	29,061		29,061		$ 31,829
Americas
Segment Information
Revenue	32,667	52,617	128,957	136,812
Long lived assets	25,124		25,124		28,182
Europe, Middle East, India and Africa
Segment Information
Revenue	43,643	21,055	102,461	78,086
Long lived assets	652		652		929
Asia-Pacific
Segment Information
Revenue	16,505	16,955	49,226	36,307
Long lived assets	1,140		1,140		455
Japan
Segment Information
Revenue	12,469	$ 6,888	23,183	$ 26,846
Long lived assets	$ 2,145		$ 2,145		$ 2,263

Financial Instruments Short-Term and Long-Term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Jan. 31, 2016	Jun. 30, 2015	Apr. 17, 2014	Feb. 28, 2013	Aug. 01, 2011
3.75% Convertible Notes
Fair value measurement
Interest rate (as a percent)	3.75%	3.75%	3.75%			3.75%
3.50% Convertible Notes
Fair value measurement
Interest rate (as a percent)	3.50%	3.50%	3.50%		3.50%
3.50% Series A Convertible Notes
Fair value measurement
Interest rate (as a percent)	3.50%	3.50%	3.50%	3.50%
Non-recurring basis \| Carrying Value
Fair value measurement
Long term debt	$ 209,673		$ 199,655
Non-recurring basis \| Carrying Value \| 3.75% Convertible Notes
Fair value measurement
Long term debt	35,778		92,863
Non-recurring basis \| Carrying Value \| 3.50% Convertible Notes
Fair value measurement
Long term debt	42,976		42,332
Non-recurring basis \| Carrying Value \| 3.50% Series A Convertible Notes
Fair value measurement
Long term debt	66,062		64,460
Non-recurring basis \| Carrying Value \| Secured Loan
Fair value measurement
Long term debt	64,857
Non-recurring basis \| Fair Value
Fair value measurement
Long term debt	250,801		270,635
Non-recurring basis \| Fair Value \| 3.75% Convertible Notes
Fair value measurement
Long term debt	36,145		102,645
Non-recurring basis \| Fair Value \| 3.50% Convertible Notes
Fair value measurement
Long term debt	58,166		65,230
Non-recurring basis \| Fair Value \| 3.50% Series A Convertible Notes
Fair value measurement
Long term debt	91,633		$ 102,760
Non-recurring basis \| Fair Value \| Secured Loan
Fair value measurement
Long term debt	$ 64,857