cyberoptics corporation (cybe) - circuit board assembly

Washington, DC Securities and Exchange CommissionC. 20549FORM 10-
Kx annual report submitted under section 13, 15 (d)
The 1934 Securities Trading Act for the year ended December 31, 2014.
O transition under section 13th or 15 (d)
In the Securities Trading Act of 1934, the transition period from _.
Commission file number(0-16577)
Digital Optics Corporation (
The exact name of the registrant specified in the articles of association)Minnesota41-1472057(
State or other jurisdiction of company or organization)(I. R. S.
Employee Identification Number)
5900 MINNESOTA55416 (niabaris, Civilization of Jinshan Delhi)
Main executive office address)(Zip Code)(763)542-5000(
Registrant phone number, including area code)
Securities registered under article 12 (b)
Securities law: names of various categories: Common stock, exchange name without Face value: LLCSecurities, Nasdaq stock market registered under section 12th (g)
Part of the Transaction Act: if the registrant is a well, a non-indicate-by check mark-
Well-known experienced issuers as defined in Rule 405 of the Securities Act.
Is it not necessary to submit a report under section 13th or section 15th indicating the registrant by checking mark (d)of the Act.
YESo no indicate indicates whether the registrant (1)
All reports requested by Article 13 or 15 have been submitted (d)
Securities Trading Act of 1934 within the first 12 months (
Or a shorter time required for the registrant to submit such reports), and (2)
This filing requirement has been bound for the last 90 days.
Indicate by check mark whether the registrant has been submitted electronically and posted on its company website, if any, according to rule 05 05 of the S-regulations, each required to be submitted and publishedT (§232.
This Chapter 405)
Within the first 12 months (
Or in such a short time that the registrant is required to submit and publish these documents).
If the declaration of arrears is disclosed under S-regulation 405th, please indicate by check markK (§ 229.
This Chapter 405)
As the registrant is aware, it is not included here and will not be included in the final proxy or information statement referenced in Part 3 of this form --
K or any amendments to this form 10K.
Indicate whether the registrant is a large accelerated filer, non-accelerated filer by checking the mark
A smaller reporting company.
See the definition of "accelerated filer" or "large accelerated filer" in Rule12b-
2 of the Trading Act.
Big acceleration filero acceleration fileroNon-
Indicate whether the registrant is a shell company by checking the mark (
Defined in Rule 12b-2 of the Act).
The vote for the total market value of YesoNo State is not
Voting Ordinary Shares held by non-shareholders
Affiliates refer to the price of the last sale of common stock or the average bid and asking price of such common stock, as of the last working day of the second fiscal quarter recently completed by the registrant: $52,014,852.
As of February 28, 2015, there were 6,685,866 shares of outstanding and outstanding registrant common stock, with no face value.
Reference to included documents: responses to items 10, 11 and 12 of Part III, 13 and 14 herein are established with reference to certain information in the final proxy statement of the annual general meeting to be held by the company on May 18, 2015.
10-1 network optics
For the fiscal year ended December 31, 2014, table contentspart iitem 1.
Business Description 3 project 1A.
Risk factor 14 item 1B.
Staff comments that have not been resolved.
Project 3.
The fourth legal procedure.
The third part is the fifth mine safety disclosure.
Market item 20 of the registrant's common stock, related shareholder matters and the issuer's purchase of equity securities.
Selected Financial Data (Not Applicable)20ITEM 7.
Management's Discussion and Analysis of the financial position and results of the operation of 21 7A.
Quantitative and qualitative disclosure of market risks
Financial statements and supplementary information item 9.
Changes in accounting and financial disclosure matters 9A and differences with accountants.
Control and procedures for Item 9B.
Other information part 8 IIIITEM 10.
Director, Executive Officer and Corporate Governance of Project 11.
Item 12 of administrative compensation 59.
Security ownership of certain beneficial owners and management, as well as relevant stock holders.
Certain relationships and related party transactions and 59 independent directors 14.
Main accounting fees and services part 59 IVITEM 15.
Schedule of exhibits and financial statements for ContentsPART IITEM 1.
Established in 1984, business background network optics is the world's leading developer and manufacturer of high-precision sensing technology solutions.
Our headquarters is located at 5900 Jinshan Avenue, Golden Valley, Minnesota.
Our website address iscyberoptics. com.
You have free access to our submission to the Securities and Exchange Commission, including our Annual Report on Form 10
K. our Quarterly Report on Form 10
Q: Current Report of Form 8
K and any other amendments to these reports, our website or the Commission website atwww. sec. gov.
The agency materials of our upcoming 2015 annual general meeting, to be held on May 18, 2015, will be provided electronically via the Internet at the following address: on March 14, 2014, we essentially acquired all the assets of laser design, the company. ("LDI")
A general measurement company based in Minneapolis, Minnesota, has a total cost of $3.
1 million cash, coupled with the assumption of certain current liabilities.
Three for LDIdimensional (3D)
Provides scanning solutions and services for the global general measurement market.
As the technology is increasingly being applied to markets ranging from automotive and aerospace to medical and consumer electronics, global demand for 3D scanning is growing.
We are working to strategically build network optics to become a global leader in high-precision 3D sensors.
Our goal is to achieve profitable growth by leveraging our 3D technology in key vertical markets for surface mounting technology (SMT)
Semiconductor and 3D scanning solutions and services.
Our products and services are used in the market for SMT, semiconductor and 3D scanning solutions and services to significantly increase the manufacturing output and productivity of our customers, help our customers meet their strict requirements for manufacturing quality.
Our products combine software, electronics, and mechanical design using various proprietary technologies such as laser, optics, and machine vision.
Our SMT and semiconductor products enable manufacturers to increase production by measuring the properties and location of components during SMT electronic circuit board assembly, or by providing SMT electronic circuit boards and semiconductor manufacturers with key indicators related to their manufacturing processes, product output and quality increase production and output.
Our 3D scanning solutions and services help manufacturers solve their most complex 3D inspection, analysis and product engineering challenges quickly, thus increasing product production and quality.
Most of our products (
72% of income in 2014)
Used for devices used in SMT electronic circuit board assemblies or SMT electronic circuit board assemblies.
We sell products in these markets, which can be incorporated into products produced by other companies as sensor components, sold to circuit board assembly companies, or as complete brackets
A separate inspection system sold directly to the board assembly company.
We manufacture 3D and 2D optical sensors for our own proprietary SMT detection systems and sell them to OEMs (OEMs)
In our main vertical market and adjacent target market.
Our SMT electronic assembly alignment sensor products are sold to pick-and-
Align the electronic surface mounting assembly when placing the machine on the board, and place it to solder paste wire mesh printer company to align the template with the board.
We also sell sensors to the original equipment manufacturer inspected by solder paste (SPI)
System, as well as the most recent semiconductor packaging detection system.
Our SMT Inspection System products are sold to Electronic Manufacturing Services (EMS)
As well as other SMT electronic board manufacturers to control qualityline systems.
The manufacturer uses these system products to measure the solder paste printed in 3D, check the circuit board and components after the elements are placed, confirm the correct placement after the circuit board is fully assembled, and check the solder joints on the printed circuit board.
Manufacturers of DRAM and Flash memory also use our system products to check the assembly of their memory modules before and after Module aging.
Our semiconductor products help improve the yield of semiconductor wafer manufacturing processes and the uptime of tools by providing highly accurate measurements of key process factors.
These measurements are not possible or very difficult without turning off the power of the wafer fabrication equipment.
Customers who use our products get better results in the following waysTools and tools-time.
Our products are more accurate than the various manual technologies historically used by semiconductor manufacturers to obtain measurement of critical wafer manufacturing processes.
Our 3D scanning solutions have access to surface data for product engineering and inspection.
Our 3D scanning service scans, models and checks objects of various sizes and complexities for customers who do not have their own universal metering equipment.
3 Content market conditions table-the latest development of the business our recent and planned product introduction is designed to strengthen our competitive position in the current market and expand to neighboring markets.
We believe that 3D detection represents
Growth in the electronics assembly market and the semiconductor market.
So we are trying to strategically re-position ourselves as a developer, manufacturer and global leader in high-tech
Precision 3D sensor.
A key element of our strategic restructuring
Positioning is the development of a new high-precision 3D sensor based on our proprietary multi-sensor
Reflection suppression (MRS)technology.
MRS techniques suppress reflections that may result in inaccurate measurements, which is particularly important for checking shiny objects.
Our 3D MRS technology will be deployed in our new 3D automatic optical inspection (AOI)
The SQ3000 system is designed to expand our presence in markets that require high-precision detection.
Although we believe that our current 2D AOI products provide industry-leading speed and low false call rates for many SMT production lines and will continue to be the best choice for these lines, we believe many manufacturers are turning to the 3D AOI system.
In these markets, the identification of defects becomes very difficult and critical due to the small electronic packaging and the increased component density on the board.
The SQ3000 is designed to maximize ROI and line utilization in a number of ways
Looking at 3D sensors that capture and transfer data in parallel at the same time makes us believe this is the fastest 3D AOI check.
We believe that the combination of our Lady technology and sophisticated 3D Fusion Algorithms provides microscopic image quality at production speeds.
Given the results of our beta testing and the feedback received during the customer presentation, we are optimistic about the future sales potential of the SQ3000.
Our acquisition of LDI is another aspect of our 3D strategy.
We are integrating our MRS technology into a new 3D scanning system CyberGage 360, which we believe will provide a wide range of detection applications in the general 3D metering market.
Cyberage 360 is scheduled to be launched in 2015.
We believe that the unique performance features of the lady can inhibit reflection and be able to make very accurate measurements at a fast speed, this will make CyberGage 360 accurate and easy to use in the market for 3D scanning systems relative to speed.
In addition to the key vertical market deployment of SMT, semiconductor and 3D scanning solutions and services equipped with Lady's 3D sensors, we also intend to extend the sales of this technology to adjacent target markets that require high-precision optical 3D detection, including the use of our Madame technology to seek new OEM opportunities.
As an example of this expansion, we recently reached a mutually exclusive agreement to supply KLA-
Tencor provides a high-precision 3D sensor subsystem for its back-end semiconductor package detection system.
The sensor subsystem is based on the new MRS technology that we have been developing over the past few years.
We have also invested money in developing new products for checking memory modules.
On February 2015, we received an order of about $1.
0 million kilometers from one of the world's four major memory manufacturers
The MX600 system is developed, which will test the memory module at the end of the production line.
The system under this order is expected to be delivered in the second half of 2015 and the customer accepts and confirms revenue.
We believe that technology is a breakthrough.
Through the optical detection technology.
For our existing market in SMT and semiconductor detection and 3D scanning solutions, we will launch new products based on this technology in 2015, and we expect MRS to promote the expansion of our future market.
We believe that these products have brought great growth opportunities to the company, and sales are currently expected to increase by at least 10%.
Even 2015 of the running results.
Our ability to achieve the forecast and effective implementation of the strategy is affected by many uncertainties and risks, including the risks identified in Item 1A of the table 10 annual reportK.
We cannot assure you that our efforts will be successful.
We develop, manufacture and sell smart, non-
Contact sensors and systems for process control and inspection, as well as contact sensors and systems for metering applications and services after the acquisition of LDI in March 2014.
Our products are sold to OEMs and end manufacturers
Customers in SMT board assembly and semiconductor manufacturing industry.
Our OEMs integrate our sensor products into capital devices that serve these industries.
We also sell sensors and brackets.
Check the system separately directly to the end user.
We create value through LDI
By integrating LDI's proprietary software with sensors and other hardware purchased from third parties, products are added and both values are sold
Additional products manufactured by third parties and complete metering systems for the creation of detailed three-dimensional (3D)
Digital Map of objects.
These 3D digital images are used for manufacturing, 3D printing and similar applications.
Through LDI, we also provide 3D map services for customers who cannot prove the capital cost of the scanned project or need special Project Services.
Manufacturers use ContentsOur's main product sheet to improve operational efficiency and production and to help them meet strict requirements for product quality.
In addition to the proprietary hardware design that combines precision optics, various light sources and multiple detectors, our products integrate control hardware and filters and convert raw data into software that applies specific information.
Our 3D scanning solutions and services help manufacturers solve their most complex 3D inspection, analysis and product engineering challenges quickly, thus increasing product production and quality.
Optical sensors we manufacture high-precision sensors for our own products and sell to neighboring markets mainly through OEM relationships.
While most of our revenue from sensor sales comes from our calibration sensors, we started selling sensors used in SPI systems under OEM agreements in 2011.
More importantly, we have developed what we believe is a breakthrough.
With the MRS technology of 3D detection, we started selling as a sensor subsystem and incorporated it into our 3D AOI, 3D scanning and 3D SPI products.
We reached an agreement with KLA.
Tencor will sell these subsystems in February 2015 and May negotiate an agreement to sell these sensors to OEMs in other markets.
We have also developed a stroboscope detection module (SIM)
This has very fast image acquisition and low miscall rate in 2D applications, we use it in 2D AOI products and intend to sell it as a sensor kit.
We believe that the strategy of developing and selling complete inspection systems and perfecting sensor and sensor subsystems as part of these complete systems and selling them to OEM customers gives us direct purpose
User customers input the functions of the inspection system most needed and purchased in our market, while leveraging our advantages in software implementation such as optical physics and noise suppression.
We believe that the resulting sensor products and subsystems are unique and add great value to the products of our OEM customers.
Until 2011, SMT electronic assembly alignment sensor products have been the largest component of our sales, a series of calibration sensors that are customized, and incorporated into the equipment manufactured by our customers for SMT circuit board assembly.
We work closely with OEM customers to integrate sensors into their devices.
Sales of these products to Juki Corporation, including maintenance services, accounted for approximately 17% of our revenue in 2014 and 18% of our revenue in 2013.
Sales of these products, including maintenance services. V. (
Kulicke and Soffa acquired the industry in January 2015)
It accounted for about 8% of our income in 2014 and 7% of our income in 2013.
Our revenue and operations are currently heavily affected by the level of purchase of these two customers, reflecting their success in the selection marketand-
Placing machines, the cyclical nature of the SMT production industry, and their ability to accurately predict production requirements and the needs for our sensors. LaserAlign®.
Our LaserAlign sensor range accounts for the vast majority of our sales in the SMT electronic assembly alignment sensor product line.
These sensors are mainly sold to pick-and-
Place Machines manufactured and sold by many different OEM customers for SMT production lines.
The LaserAlign range of products will be installed and run through large and small surfaces-
In the process of transportation on the picker, the hole assembly called chip capacitor and resistorand-
Place the machine before placing.
The LaserAlign sensor has been incorporated into the placement of the pick-upand-
Place the machine to ensure accurate placement of components at high production speeds. Various high-speed pick-and-
Each machine uses 1 to 20 laser alignment sensors.
LaserAlign integrates an intelligent sensor consisting of lasers, optics and detectors, as well as microprocessor and software for specific measurements.
LaserAlign enables each component to be aligned quickly and accurately when transported by the picker-and-
Placement of arms for surface mounting or passinghole assembly. Using non-
Contact Technology, LaserAlign helps to locate and place components at a higher speed than using traditional mechanical or machine vision component alignment systems.
The LaserAlign sensor is available in a variety of different configurations to meet the requirements of the machine that uses it.
The latest version of LaserAlign sensor technology was launched in 2013 and is the sixth generation sensor of Juki Corporation.
Revenue from new product shipments of LaserAlign sensors has been a major contributor to revenue over the past five years, accounting for 20% of our revenue in 2014 and 2013.
Month table contentsboarign camera (BA Camera).
BA camera, directly incorporated into the placement head of the picker-and-
Place the machine, identify the reference mark on the board and align the boardand-
Place the machine before the assembly is placed.
The BA camera was originally introduced in a sensor for assembling B. V.
During the period from 2003, the second generation BA camera launched in 2012 has been incorporated into the latest version of the assemble on B. V.
The parts of the machine are placed.
Revenue from shipment of BA camera sensors to Assembly BV.
We accounted for 5% of our income in 2014 and 4% in 2013.
The printer checks the camera.
InPrinter check the camera is installed directly in the DEK brand screen printer manufactured by ASM Pacific Technology Ltd.
, Identify the benchmark mark on the board to ensure accurate board registration before placing solder paste and provide upgrade function for 2D solder paste and template check.
In the third quarter of 2005, the DEK brand screen printer launched the InPrinter inspection camera.
InPrinter inspection camera shipments accounted for 4% of our revenue in 2014 and 5% in 2013.
3D Solder Paste Detection (SPI)
SensorsWe has created a custom designed 3D SPI sensor for our own SPI system series.
In early 2011, we reached an agreement with Viscom GmbH to integrate and sell the sensor to Viscom for use on their SPI platform.
Sales of 3D SPI sensors in Viscom began in the second half of 2011, accounting for less than 2% of our revenue in 2014 and less than 1% of our revenue in 2013.
Although we have been focusing on the development of Lady sensors for SMT industry, in January 2015, we reached an agreement of mutual exclusion for KLA-
The back-end semiconductor packaging detection system of Tencor.
Our high-precision 3D sensors are based on commercial cameras, DLP projectors and other hardware components, combined with our proprietary MRS technology and 3D Fusion Algorithms.
The combination of these elements allows our sensors to capture images that we consider to be microscopic quality at production speed.
Strobe detection module (SIM)
We also have proprietary image interpretation based on our strobe detection module or SIM technology (Ai2)
Automatic optical detection software.
These sensors are designed based on proprietary hardware and use the concept of strobography-based lighting to achieve extremely fast image acquisition.
We have deployed these sensors in our 2D AOI detection system family, which we believe provides industry-leading low false call performance
Production speed of production line.
We are also using this technology in new areas.
Developed MX600 system for post
Signal detection of memory modules.
So far, our use of SIM technology is limited to our own 2D AOI products for SMT.
We intend to develop a sensor kit based on our SIM technology that can be used for a variety of inspection tasks outside of traditional SMT applications, including integrity and accuracy checks at the end of the final assembly of the production line.
SMT Inspection System products our SMT Inspection System products are used for process control and inspection in SMT electronics assembly industry.
These systems are sold directly to the terminal
Users who use them on or along the production line make customers-
Responsible for the maintenance and quality control of the production line.
Our products include our proprietary 3D and 2D optical sensors, ready-made, translated or robotic hardware and conveyor belts, and complete computer systems or processors with in-house development software.
Inspection of tin paste (SPI)
Products we have been selling
Line 3D Solder paste measuring instrument has been developing and developing our SPI series products for more than ten years.
In 2013, we introduced a new 3D SPI system, SE600, which uses
Lighting sensors and enhanced user interfaces.
Content Table 6.
SE600 is an in-
Line system based on dual bus
Lighting sensors, after the first step of the SMT board assembly process, measure the amount of solder paste applied to the board in 3D.
Since the component size that must be placed on each solder pad of solder paste is small and the component density placed on the circuit board is small, a large number of SMT assembly problems are related to the quality of solder paste deposition.
The wrong amount of solder paste, excessive or insufficient solder paste may result in incorrect connection or bridge between leads, resulting in a failure of the entire board.
The SE600 checks the height, area and volume of the board 100% at line speed and resolution, enabling it to measure the smallest chip size package and the position of the micro-ball array elements.
The SE600 can be integrated into most SMT production lines, providing real-time quality control immediately after the printed circuit board leaves the screen printer and before the component placement begins. SE500ULTRA.
In 2013, we introduced our latest
The SE500 SPI system SE500 ultra uses the same proprietary 3D detection technology as the SE600, but with a single lighting sensor.
The Se500 ultra is checked at a faster speed than the SE600 for high
Mass production environment.
Because the se500 ultra prioritizes speed, it cannot provide the same resolution and measurement performance as the se600.
Shipments of our SPI products accounted for 15% of our revenue in 2014 and 20% of our revenue in 2013.
Automatic optical detection (AOI)
Products we have sold AOI products for more than ten years and continue to develop and develop our AOI products since its establishment.
These products check the circuit board after the elements are placed to determine whether all elements exist and are placed correctly, and can also be used to measure the quality of the solder joints after reflow.
We hope to launch our first 3D AOI system SQ3000 in early 2015. SQ3000.
Our first 3D AOI system SQ3000 is designed to expand our presence in markets that require high-precision detection.
Due to the small electronic packaging, the increased component density, coupled with smaller, more complex solder joints, it becomes very challenging and critical to identify defects on the board.
The SQ3000 is designed to maximize ROI and line utilization in a number of ways
Looking at 3D sensors that capture and transfer data in parallel at the same time, we think this is the fastest 3D AOI check at the moment.
We believe that the combination of our Lady technology and sophisticated 3D Fusion Algorithms provides microscopic image quality at production speeds.
Beta testing and customer presentations for our new 3D AOI system have started and we expect to officially launch our new 3D AOI system by the end of 2015.
QX600 and qx150 I.
Our next generation 2D QX600 and qx150 I AOI systems employ our SIM sensor technology and advanced Ai2 software, which we believe provides industry-leading low
In 2013 and 2012, we introduce important software enhancements for all of our AOI products that improve set
Programming time and ease of use are provided to customers.
Our QX600 also has versions that can accommodate dual production lines and larger board sizes.
QX500 and QX100i.
We sell 2D QX500 and QX100i AOI systems for production lines that require faster detection speeds.
These products also feature our SIM sensor technology and advanced Ai2 software.
QX500 and QX100i do not offer the resolution capability of QX600 or qx150 I, but instead, it is designed to provide the fastest AOI inspection time on the market at present and an industry leading level with low false call performance.
The QX500 can also accommodate dual production lines and larger board sizes. MX600. Our newly-
The developed MX600 system is based on our 2D SIM module and Ai2 software technology for later stage
Signal detection of memory modules.
We received $1 on February 2015.
MX600 system orders from one of the world's four major memory manufacturers.
Shipments of our AOI products accounted for 19% of our revenue in 2014 and 21% of our revenue in 2013.
In March 14, 2014, we acquired all the assets of Laser Design, Inc. (LDI)
A company that provides 3D scanning systems and services to the global general measurement market.
Global demand for 3D scanning is growing, with 3D scanning capturing the shape of objects digitally, as the technology is increasingly being applied to markets ranging from cars and aerospace to medical and consumer electronics.
Tables of ContentsLDI high-end 3D scanners can be sold as kits or as complete systems that make LDI's proprietary Surveyor series software with coordinate meters or others
LDI also sells a variety of other types of 3D scanning equipment produced by other suppliers.
With its 3D scanner, LDI also provides scanning services for customers or in-who do not have their own 3D scanning device-
Ability to scan complex parts.
In 2014, sales of LDI 3D scanning solutions and services accounted for 11% of our revenue.
One of the main reasons why we buy LDI is
Fast 3D scanning system developed.
We are further strengthening this scanning system by combining this scanning system with our new Mrs technology.
We intend to launch this in 2015 with the new Lady scanning system, CyberGage 360.
We believe that MRS's unique performance features can suppress reflection and achieve extremely accurate measurements at a fast speed, which will give CyberGage 360 a competitive advantage in the 3D scanning technology market.
Semiconductor products our main semiconductor products®The product range is a range of wireless sensors used to measure key factors in the semiconductor manufacturing process.
We sell our semiconductor products to OEM and terminal
The user customer is through a network of independent sales reps.
Sales of our semiconductor products accounted for 16% of our revenue in 2014 and 21% of our revenue in 2013.
Waffersense sensor.
We have designed our wafilersense sensor series for the position of wafers in semiconductor manufacturing and provide measurements of key factors that, if not powered off for manufacturing process equipment, are currently
Because users do not need to break down semiconductor manufacturing equipment when using our waffersense products, our customers tell us, compared with the manual technology currently used by many customers when checking the process parameters measured by our waffersense products, it saves a lot of time and improves accuracy.
Thanks to waffersense technology, up-time, through-
The input and process yield of semiconductor manufacturing equipment are improved.
We launched our first product, automatically leveling sensors (ALS)
At the end of 2004, new products have continued to be added to the waffersense family.
ALS is wireless, vacuum.
Load locks and boxes, FOUPS, end actuators, calibrators, compatible sensors that can be placed for use in semiconductor manufacturing to ensure that all stations are horizontal and co-faced.
Automatic gapping sensor (AGS)
It is a gapping tool that measures the gap between the shower head and the base of the semiconductor process equipment.
Automatic teaching sensor (ATS), measures X-Y-
The Z shift from wafer robot to base in semiconductor process equipment.
When the material is deposited on a semiconductor wafer, the gap and offset after the wafer robot is transferred to the shower seat will affect the thickness and uniformity of the film and affect the quality and product yield.
Automatic vibration sensor (AVS)measures X-Y-
Z acceleration of impact and vibration, which may result in wafer particles, scratches, or wafer breakage, thereby reducing yield.
Automatic particle sensor (APS)
, Allows engineers to effectively detect and classify particles and their exact sources during wafer transfer, open slit start, chamber circulation, pumping and purification.
APS is designed to be compatible with the front end
End, coating machine/developer track and deposition and etching equipment.
In 2014, we have expanded our particle sensing technology to adopt a particle sensor in the shape of a cross line (ReticleSense™).
Wireless, real.
The time function of ReticleSense allows users to quickly identify geographic particle sources in a reticle environment.
In early 2015, we launched a quartz shell (APSRQ)
Semiconductor tools for processing quartz marking.
ReticleSense APSRQ specializes in the design and development of scanners for semiconductor fab with all necessary calibration marks and bar codes compatible with ASML, Nikon and Canon scanners.
APSRQ can be loaded directly into the scanner like a quartz marking, and real-time detection through the entire marking path
The time and place where particles occur.
By expanding the production line to include quartz airborne particle sensors, we are helping our customers to exceed manufacturing quality and productivity standards in an exposure scanner environment.
We intend to continue to strengthen and expand the waffersense product line in the future.
We sell the vast majority of our products to the SMT electronic assembly and memory Manufacturing Market (
72% of total revenue in 2014).
In these markets, the value of automation is high because of the high unit cost of the products produced, and the manufacturing speed is too fast to carry out effective manual intervention.
In addition, trends in smaller electronic devices with higher circuit density, smaller circuit paths, and extremely small components require manufacturing and testing equipment that can be very accurately aligned and multi-dimensional, such as the use of non-
Optical sensors.
Trends in these markets include further efforts to reduce the cost of manufacturing processes and to limit human intervention through automation.
ContentsOur SMT electronic assembly alignment sensor tables are sold to OEMs serving the SMT circuit board assembly market.
The vast majority of our 3D and 2D optical sensors are used in our own SPI and AOI detection system products, we sell to board assembly manufacturers that serve the electronic assembly market or oem own boards that manufacture them.
Our AOI and SPI inspection system sales take place in all global regions and are fairly distributed between the Americas, Europe and Asia, in the Americas, Europe and Asia, in the global production capacity of circuit board assembly
We produce all sensor products at the headquarters factory in Minneapolis, Minnesota.
All final assembly of our inspection system products and centralized Chengdu are carried out at the Singapore factory.
We sell our SMT sensor and detection system products to many leading manufacturers of electronic circuit board assembly equipment, manufacturers of semiconductor DRAM and SSD memory, and end manufacturers worldwide
User electronics assembly manufacturers including Asian Original Design Manufacturers (ODMs)
And EMS providers that make electronic devices such as mobile phones, smartphones, laptops and server boards.
We have sales and service offices in China and Singapore to serve the Asian manufacturing and production equipment market.
Our sales and service office in the UK serves the European market, and we have sales and service team members at our head office in Minneapolis to serve the American market.
We work with the German distributor Viscom, which has a lot of sales in the automotive industry to better penetrate the European market and work with newer high performance products, we intend to expand our sales and especially in the Americas and Europe.
We are eligible to be a supplier of KLA in January 2015
Tencor and entered into a mutually exclusive agreement to provide a 3D sensor subsystem for KLA-
The back-end semiconductor packaging detection system of Tencor.
We believe that our MRS technology is a breakthrough 3D detection technology that can be applied in a range of markets including the semiconductor market for KLA services. By selling sensor subsystems to leading manufacturers such as KLA, we will be able to access these markets more effectively.
In 2014, our semiconductor products accounted for 16% of our revenue, mainly composed of wafilersense series.
This market has many of the same features as the SMT electronic assembly market and needs to be
Contact optical measuring tools capable of producing more complex, dense, and smaller semiconductor devices.
Our WaferSense precision measuring tool series for process optimization of semiconductor processing equipment is sold directly to semiconductor manufacturing facilities or through semiconductor capital equipment manufacturers to semiconductor manufacturing facilities, for the production of semiconductor wafers by process and equipment engineers.
The world's largest semiconductor manufacturer buys our products.
We sell our high-end 3D scanning solutions and services directly in the US and through small channels from Asian distributors.
We intend to use our global distribution channels for our SPI and AOI systems to sell the CyberGage 360 3D scanning products we intend to launch in 2015.
We support our sales efforts in 3D scanning solutions and services by leveraging an Internet-based search engine marketing program, from potential customers who indicate an interest in getting these types of products and services
Export sales account for a large part of our total sales, as a large part of global electronic assembly and semiconductor production capacity occurs outside the United States.
In addition, a large part of our export sales includes SMT electronic assembly alignment sensors sold to OEM customers in Europe and Asia.
The table below lists the percentage of total export sales as a percentage of total sales revenue (
Sales delivered to countries outside the United States, including sales delivered through distributors)
Location-by-location for the past two years: December 31, 2014 203asia44% 48% Europe 25% 26% other export sales (1)4%4%(1)
Including export sales in the Americas, mainly Canada, Mexico and Latin America.
See Note 14 to consolidated financial statements contained in Item 8 of this form-K.
Most of our international export sales are negotiated, invoiced and paid in the United States. S. dollars.
We produce SMT system products in Singapore, and some raw material purchases are priced in Singapore dollars.
We also have R & D and sales staff in Singapore and sales offices in other parts of the world.
Although currency fluctuations do not have a significant impact on our income, they affect our costs, the price competitive nature of our products and the willingness of existing and potential customers to buy units.
Our SMT calibration and inspection sensors and 3D high precision sensors for back-end semiconductor packaging are sold to large OEM customers by direct sales staff located in Minnesota.
Our inspection system products are mainly sold through independent delegates and distributors, which are managed by direct sales staff located in Singapore as well as in the UK, USAS. and China.
We have reached an agreement with 45 independent delegates and distributors who focus on the sales and service of our booth
Separate system products to the terminaluser customers.
These agreements cover North and South America (14), Europe (16)
China and other parts of Asia (15).
We have established a separate global sales representative organization for our wafilersense semiconductor products.
We have now reached an agreement with the sales representative in the United States or are in the process of processingS. (5), Europe (5)
And the Pacific Rim (5).
In some cases, we sell our wafilersense products directly to large OEM customers.
Sales of our independent sales representative and OEM customers are managed by direct sales staff located in the USS. and Asia.
We sell 3D scanning solutions and services through direct sales staff in Minnesota and three dealers in Asia.
We intend to sell our cyberage 360 products by using the same independent sales reps and distributors that sell our SPI and AOI detection system products.
We promote our products through articles published at industrial trade shows, industrial Journal advertising, industrial and technical journals, and the Internet.
In addition, we have established strategic relationships with certain key customers that can be used as highly visible references.
BacklogOur products are usually shipped within two weeks and two months of receiving the order.
The product backlog is $5.
In December 31, 2014, it was $9 million, compared to $4.
December 31, 2013 1 million.
A total backlog of $4.
In the first quarter of 2015, 3 million pounds could be delivered.
Due to the performance or other acceptance criteria contained in the terms of sale, the sale of some SMT Inspection System products may require customer acceptance.
For sales of these SMT products, revenue is recognized at the time of customer acceptance.
While our business is generally not very seasonal, sales can vary depending on the capital purchasing practices in SMT electronics components, general industrial manufacturing, and semiconductor manufacturing industries.
For example, capacity expansion in the SMT electronics assembly industry for the expected holiday or back-to-school needs could lead to higher sales levels in our second and third quarters.
However, we cannot quantify the impact of these events on our sales in any quarter at any precise level, any seasonal cyclical nature is often overshadowed by changes in demand caused by normal fluctuations in the electronic market associated with economic change.
Depending on the order time of the OEM customer, there may be a big difference in our planned backlog at any time.
Therefore, the backlog may not be an accurate indicator of future performance.
Research and development of our products is mainly based on the customer benefits brought about by the use of smart and proprietary technologies, and our ability to combine several different technical disciplines to meet the needs of the industry and customers.
In addition, we actively seek to establish an ongoing strategic customer relationship with leading product innovators in our service market, and actively investigate the needs of these customers and seek their input to identify improvements in the manufacturing process
Our engineers often interact with customers to ensure current technology is adopted.
In some cases, we may obtain funds from these customers through development contracts that provide the customer with an exclusive sales period, but allow us to retain technical and sales rights.
We invest a lot of resources to develop the next important goal.
We are confident that the new generation of technology will make us a global technology leader in high-precision 3D sensors and take more market share in the key vertical markets of SMT, semiconductor and 3D scanning solutions and services.
Even during a period of weakness in our market, we maintain our commitment to R & D and product development.
Over the past year, research and development has been focused on a number of activities that are critical to our future growth and success, including the following: developing our lady technology, using the high-speed metering-level 3D measurement capability of commercial components and proprietary algorithms, we believe this will solve many of the reflection problems that affect the technology of all triangular measurement sensors.
Our content development table for the first 3D AOI system sq3000.
The system is designed to expand our presence in markets that require high-precision measurement and inspection.
Due to the small electronic packaging, the increased component density, coupled with smaller, more complex solder joints, it becomes very challenging and critical to identify defects on the board.
The SQ3000 is designed to maximize ROI and line utilization in a number of ways
Looking at the 3D sensors that capture and transfer data in parallel at the same time makes us believe this is the fastest 3D AOI check at the moment.
We believe that the combination of our Lady technology and sophisticated 3D Fusion Algorithms provides microscopic image quality at production speeds.
We expect the SQ3000 to be officially launched by the end of 2015.
The development of our first post-system
Signal detection of memory module, mx600.
The system is based on our 2D SIM sensor technology and Ai2 image recognition software.
The inspection requirements for this application are similar to the AOI produced by the circuit board.
We received $1 on February 2015.
0 million orders from one of the world's four major memory manufacturers
The MX600 system has been developed for its superior speed, detection performance, and lower false call levels.
A new 3D scanning system CyberGage 360 has been developed, which combines our new MRS technology.
We believe that the system will be used to inspect and measure various components and manufactured components in the general industrial market.
We expect to officially launch CyberGage 360 in 2015.
We believe that the unique performance of MRS can suppress reflection, which is especially important for shiny objects and can be measured very accurately at a fast speed, will give CyberGage 360 a competitive advantage in the market for 3D scanning solutions.
Continue to develop our wafilersense product line by introducing particle sensors in the shape of the Cross (ReticleSense).
Wireless, real.
The time function of ReticleSense allows users to quickly identify geographic particle sources in a reticle environment.
In early 2015, we launched a quartz shell (APSRQ)
Semiconductor tools for processing quartz marking.
ReticleSense APSRQ specializes in the design and development of scanners for semiconductor fab with all necessary calibration marks and bar codes compatible with ASML, Nikon and Canon scanners.
APSRQ can be loaded directly into the scanner like a quartz marking, and real-time detection through the entire marking path
The time and place where particles occur.
By expanding the production line to include quartz airborne particle sensors, we are helping our customers to exceed manufacturing quality and productivity standards in an exposure scanner environment.
R & D costs $8.
It was $8 million and $7 in 2014.
2013 5 million.
These amounts accounted for 19% of revenue in 2014 and 23% in 2013, including ldi r & D costs from the date of acquisition.
Research and development costs mainly include wages, project materials, contracted labor and other costs related to ongoing product development and enhancement work.
Centrally Manage the utilization of research and development resources based on market opportunities and the status of individual projects.
All of our 3D and 2D optical sensors, SMT alignment sensors, and wafilersense semiconductor sensor products are assembled at the factory at the headquarters in Minneapolis, Minnesota.
Our SMT Inspection System products are assembled in Singapore.
Most of our product manufacturing is mainly circuit board manufacturing, lens manufacturing and metal parts production, with contracts with external suppliers.
Our production staff checks incoming parts for final assembly, calibration and final quality control testing of finished products.
Our products are not suitable for mass production, which proves that the capital investment required to complete the internal manufacturing is reasonable.
The various components used in our products can only be obtained from a single source and involve a relatively long order cycle, in some cases more than one year.
We believe we have identified alternative assembly contractors for most of our subsidiariesassemblies.
The use of these alternative contractors may require significant rework of the product design, resulting in our inability to meet customer orders.
Actual changes to such contractors may take a period of training and testing.
Therefore, an interruption in the supply relationship or production capacity of one or more such contractors may result in the inability to deliver one or more products within a few months.
In order to help prevent delays in shipment of our products, we keep stock, or the supplier delivers as planned, we believe that the quantity of certain components is sufficient according to the forecast demand (
Forecast extension of at least 6 months).
In the market for machine vision, image processing and detection systems, we are faced with the competition of many companies, some of which are larger and have more financial resources.
11 ContentsOur 3D and 2D optical sensors and SMT electronic assembly alignment sensor tables compete primarily with sensors and visual systems developed by OEMs using their own designers to incorporate their products.
We believe that the high-precision 3D sensor based on MRS technology is unique in the market, because we believe that it can provide micro-image quality at a fast production line speed.
Our 2D SIM sensor and SMT electronic assembly alignment sensor products are also aligned with vision (
Camera and software based)
A library of systems and components provided by Connex and other companies.
While advances in visual systems have reduced some of the advantages of our SMT electronic assembly alignment sensor products in certain configurations, we continue to believe that, our sensors are able to customize the design products with strict physical shape requirements, speed, flexibility, low cost and ease of use, so that they are in a competitive position.
We believe that the Ai2 software used in our 2D SIM sensor technology and QX series products are different from competitors, which compete effectively in the AOI market based on cost, ease of use and lower false call rate under fast production line speed.
The main competitors of our SPI and AOI system sales come from Korean companies, including KohYoung Technology (SPI and AOI), MirTec Ltd. (SPI and AOI), and Parmi (SPI).
We also compete with test research companies in Taiwan. (SPI and AOI)
Viscom, headquartered in Germany (SPI and AOI), among others.
The sales volume of AOI system is about 2-
The market for SPI/AOI detection systems totaled about $0. 5 billion, of which 3D AOI represents the fastest growing segment of the market.
We believe that through our proprietary MRS technology and 3D fusion algorithm, our new SQ3000 3D AOI products will be different and help us gain market share according to our ability to provide, we believe, the speed on the production line is micro image quality.
The market for approximately $1 billion of 3D scanning solutions and services is highly fragmented.
The main competitors of our 3D scanning solutions include Zeiss and other companies based on CMM products, Faro's joint robot arm products and a variety of other 3D measurement technologies that offer different
The market for 3D scanning services is dominated by small regional market players.
We believe that the unique performance of MRS can suppress reflection, which is especially important for shiny objects and can be measured at high speeds, cyberGage 360 will gain a competitive advantage in the market segment that prioritizes these performance features.
We believe that our wafilersense products are unique in the market and mainly face competition from the manual technology currently used by most customers to monitor semiconductor manufacturing equipment.
Because the user does not need to destroy the semiconductor manufacturing equipment or pressurize the vacuum chamber, we believe that compared with the manual technology currently used by the customer, our waffersense products will save a lot of time and improve measurement accuracy and will improve tools-time, through-
Input and processing output.
Although we believe that our current and planned products offer some advantages in terms of price and suitability for specific applications, although we try to protect the proprietary nature of these products, any of our products are likely to be copied by other companies in the same big market that we are involved in.
We have 169 employees in December 31, 2014.
Time global staff, including 38 sales, marketing and customer support, 59 manufacturing, procurement and production operations, 57 engineering, R & D, 15 finance, administrative and information services.
Of these employees, 89 are located at our corporate headquarters in Minneapolis, 24 at the LDI plant in Bloomington, Minnesota, and 56 in other offices (
5 in the UK, 1 in Oregon, 1 in California, 43 in Singapore, 3 in China, 2 in Taiwan and 1 in Japan).
So far, we have successfully attracted and retained qualified technicians, although there is no guarantee that this success will continue.
None of our employees are within the scope of the collective bargaining agreement or are members of the Union.
We rely on professional technical knowledge and expertise.
How to protect our people and trade secrets, as well as patents, to maintain our competitive position.
We try to protect intellectual property rights by combining technology with internal security measures to limit access to proprietary methods.
In addition, we use
Disclosure agreements with customers, consultants, suppliers and employees.
However, there is no guarantee that any of the above measures will be sufficient to protect our proprietary technology.
We have 66 patents (41 U. S. and 25 foreign)
Including the technologies used in our 3D optical sensors, MRS technology, LaserAlign products, SIM sensor technology, detection systems, cyberage 360 3D scanning systems and other products.
Equipment involved in some patents, such as pickingand-
Integrate our products into machines.
In addition, we have 20 patent applications (10 U. S. and 10 foreign).
We mainly protect the proprietary nature of our software through copyright and license agreements, and also protect the proprietary nature of the software through close integration with our hardware products.
We use 19 registered trademarks (11 U. S. and 8 foreign)
There are 14 trademarks to be registered (2 U. S. and 12 foreign).
We also have 14 domain names and several common law trademarks.
Our policy is to protect the proprietary nature of new product development when it may become an important source of revenue.
There is no guarantee that we will be able to obtain patents or other protection for other products.
With the increase in the number of our products and the expansion of the functions of these products, we may increasingly be tempted to replicate our proprietary technology and infringement claims.
In addition, although we do not believe that our products infringe on the rights of others, there is no guarantee that third parties will not file infringement claims in the future, there is also no guarantee that any such claim will not require us to enter into a royalty arrangement or result in litigation.
Many of our products have lasers.
According to the applicable rules and regulations of the equipment and Radiation Health Center, products containing lasers are classified as Class I, Class II or Class IIIb laser products (CDRH)
Director of Food and Drug Administration
Such a rule generally requires a self
Certification procedures under which manufacturers must submit to CDRH periodic reports containing each product of laser equipment, sales and purchases, and compliance with product labeling standards.
Our laser is usually harmless to human tissues, but it can cause damage if it is directly exposed to an individual's eyes or misused.
We are not aware of any incident involving a claim for laser equipment injury or injury and believe that our sensor and sensor systems comply with all applicable laws for the manufacture of laser equipment.
Content Table 1A.
Risk factor operations are affected by some risks and uncertainties that may affect our financial results and the accuracy of forward-looking statements we make in table 10K.
We make statements on expected product introductions and performance, market changes, customer and customer order rates, R & D expenditures, revenue growth and profit, increase in tax levels, impact of prices and competition, all of this represents our expectations and beliefs about future events.
Due to many factors that affect our business, our actual results may differ from these expectations, and the most important of them include the following: we are currently rolling out some products based on our new 3D MRS technology that fails to meet our expectations and will have a significant adverse impact on our expected operational results.
We believe that our MRS technology is unique in the market, because it can suppress reflection and provide micro-quality images at production line speed, and we have high expectations for the prospect of a longer period of time
Long term sales of products based on this technology.
We have incorporated MRS technology into several of the products we are currently launching or are about to launch, including our new 3D AOI product SQ3000, we plan to launch CyberGage 360 products for the 3D scanning market in the second quarter, as well as including KLA-Tencor.
We also want to use this technology in the next generation of other inspection products and products for new applications.
Although we believe that MRS technology in pre-
Some products released or "beta" version, it is not used by the customer in the form of commercial release purchased by the customer, nor is it used for a long timeterm in a full-
Scale production environment.
New technologies often encounter problems in applications. new products often contain operational problems that can only be solved after use.
If the performance of MRS technology does not meet our expectations, if our products based on MRS technology do not meet the specifications, or if the market believes that this technology is not attractive, our business performance this year, and our expectations for long-term growth will be significantly adversely affected.
Our business has and will continue to be significantly affected by the global economy, and the uncertainty of the global economic outlook makes it more likely that our actual results will differ significantly from expectations.
In 2009, the world economy experienced its worst recession since the Great Depression of 1930s.
Extreme turmoil in global credit and financial markets, including a severe reduction in liquidity and credit supply, a decline in consumer confidence, a decline in economic growth, and an increase in unemployment, has led to severe economic conditions and uncertainty about economic stability.
These economic uncertainties affect businesses like us in many ways, making it difficult for us to accurately predict and plan our future business activities.
Further political instability or uncertainty could lead to credit tightening in financial markets, could lead to delays in spending by consumers and businesses, could lead to cancellation by our customers, reduce or delay their orders with our existing and future.
In addition, the financial difficulties experienced by our suppliers or distributors may result in product delays, increased receivables defaults and inventory challenges.
We sell raw equipment manufacturers of sensors to supply SMT manufacturers, as well as circuit board manufacturers that purchase SMT Inspection System products directly, much depends on the continued demand for consumer and commercial electronics, including mobile phones, smartphones and computers.
Demand for electronic products is a function of the health of the US and the world economy.
Sales of our semiconductor products and 3D scanning solutions also depend on the health of the global economy.
If these economies enter recession, our results will be adversely affected in the future.
World events beyond our control may affect our operations.
Our operations and markets may be negatively affected by world events that affect the economies and businesses of specific countries where we do business, such as China, Singapore and Japan.
Natural disasters, such as the tsunami and earthquake that hit Japan in 2011, and the floods that hit Thailand, have affected travel patterns and transportation facilities in these countries in the past and other natural events, for example, the outbreak of bird flu may affect our business in these countries in the future.
There may be terrorist activities or other armed conflicts in countries where we do business, which affect labor disputes over complex international shipping arrangements, or other unexpected behavior of local residents may affect our ability to do business in a specific area.
Many of the countries we do business in may be affected by economic forces different from those that affect the power of the United States and change our business volume.
The table of ContentsOur's operating performance varies, and may continue to change significantly every quarter, resulting in fluctuations in our share price.
In the past, our quarterly operating results were different and may continue to change significantly every quarter, resulting in fluctuations in stock prices.
Some factors that may affect our operating results and make our inventory subject to price and volume fluctuations include changes in customer demand for our sensors, detection systems, and 3D scanning solutions, affected by the economic situation of these industries and the overall health of the global economy, the demand for products using circuit boards and semiconductors, market acceptance of products developed by our products and customers, competition, seasonal changes in customer needs, time, cancellation or delay of customer orders, Cost of product development, including increased research, development, engineering and marketing costs related to our launch of new products and product enhancements.