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<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 13.5pt; font-size: 10pt;" align="left"><b>12.</b>     <b>Acquisitions</b> </div> <div style="margin-top: 13.5pt; font-size: 10pt;" align="justify"><b><i>Acquisition of Windtec Consulting GmbH</i></b> </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          On January 5, 2007, the Company acquired AMSC Windtec, a corporation incorporated according to the laws of Austria. AMSC Windtec develops and sells electrical systems for wind turbines. AMSC Windtec also provides technology transfer for the manufacturing of wind turbines; documentation services; and training and support regarding the assembly, installation, commissioning, and service of wind turbines. </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          The acquisition agreement included an earn-out provision for the issuance of up to an additional 1,400,000 shares of common stock upon AMSC Windtec's achievement of specified revenue objectives during the first four fiscal years following closing of the acquisition. During the six months ended September 30, 2010, the Company recorded contingent consideration of $10.0 million to Goodwill and Additional paid-in capital representing 350,000 shares earned. These 350,000 shares are expected to be issued in the first quarter of the fiscal year ending March 31, 2012. As of September 30, 2010, the Company has recorded contingent consideration up to the maximum amount of shares that could be earned under the agreement. The carrying amount of goodwill at September 30, 2010 and March 31, 2010 was $ 47.5 million and $36.7 million, respectively. The goodwill activity for the six months ended September 30, 2010 is as follows (in thousands): </div></div> <h5 align="left"><a href="blank#tocpage"> </a></h5> <p> </p> <div style="font-family: 'Times New Roman',Times,serif;"> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="50%"> <tr valign="bottom"><td width="88%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Balance at March 31, 2010</div></td> <td> </td> <td nowrap="nowrap" align="left">$  </td> <td align="right">36,696</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Contingent consideration</div></td> <td> </td> <td> </td> <td align="right">10,003</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Net foreign exchange rate impact</div></td> <td> </td> <td> </td> <td align="right">809</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Balance at September 30, 2010</div></td> <td> </td> <td nowrap="nowrap" align="left">$  </td> <td align="right">47,508</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td></tr></table></div> <p style="font-size: 12pt;" align="center"> </p> <h5 align="left"><a href="blank#tocpage"> </a></h5> <p> </p><strong><em>Investment in Tres Amigas</em></strong> <p> </p></div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 6pt; font-size: 10pt;" align="justify">          On October 13, 2009, the Company made a minority investment in Tres Amigas LLC, ("Tres Amigas"), a merchant transmission company, for $1.8 million. Consideration for the investment was $0.8 million in cash and $1.0 million in AMSC common stock. The investment was recorded under the equity method of accounting and is included in other assets on the condensed consolidated balance sheet. The Company's minority interest in the losses of Tres Amigas are included in other income (expense), net, on the condensed consolidated statements of income and were immaterial for the three and six months ended September 30, 2010. The carrying value of the investment at September 30, 2010 was $1.4 million. </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="left"><b><i>Investment in Blade Dynamics Ltd.</i></b> </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          On August 12, 2010, the Company acquired (through AMSC Windtec), a 25 percent ownership position in Blade Dynamics Ltd., ("Blade Dynamics"), a designer and manufacturer of advanced wind turbine blades based on proprietary materials and structural technologies, for $8 million in cash. The investment was recorded under the equity method of accounting and is included in other assets on the condensed consolidated balance sheet. The Company's minority interest in net losses of Blade Dynamics are included in other income (expense), net, on the condensed consolidated statements of income. The net investment activity for the six months ended September 30, 2010 is as follows (in thousands): </div> <div align="center"> <table style="font-size: 10pt; margin-right: 22%;" border="0" cellspacing="0" cellpadding="0" width="48%"> <tr style="font-size: 14.5pt;" valign="bottom"><td width="88%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Purchase of minority investment</div></td> <td> </td> <td nowrap="nowrap" align="left">$      </td> <td align="right">8,000</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Minority interest in net losses</div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(212)</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Net foreign exchange rate impact</div></td> <td> </td> <td> </td> <td align="right">546</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Balance at September 30, 2010</div></td> <td> </td> <td nowrap="nowrap" align="left">$  </td> <td align="right">8,334</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td></tr></table></div></div> </div>

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<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 12pt; font-size: 10pt;" align="left"><b>10.</b>     <b>Commitments and Contingencies</b> </div> <div style="margin-top: 7.5pt; font-size: 10pt;" align="justify">          From time to time, the Company enters into long-term construction contracts with customers that require the Company to obtain performance bonds. The Company is required to deposit an amount equivalent to some or all the face amount of the performance bonds into an escrow account until the termination of the bond. When the performance conditions are met, amounts deposited as collateral for the performance bonds are returned to the Company. </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          As of September 30, 2010, the Company had five performance bonds on behalf of its AMSC Windtec and its wholly-owned subsidiary, Suzhou AMSC Superconductor Co. Ltd ("AMSC China"), in support of customer contracts to guarantee supply of core components and software. The total value of the outstanding performance bonds is $2.0 million expiring between December 31, 2010 and March 31, 2014. In the event that the payment is made in accordance with the requirements of any of these performance bonds, the Company would record the payment as an offset to revenue. </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          At September 30, 2010 and March 31, 2010, the Company had $5.5 million and $5.7 million, respectively, of restricted cash included in current assets, which includes the restricted cash securing the AMSC Windtec performance bonds noted above. The Company also has an additional $3.5 million in bank guarantees and letters of credit supported by unsecured lines of credit. </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The Company also has unused, unsecured lines of credit consisting of CNY 11.9 million (approximately $1.8 million) and €2.3 million (approximately $3.1 million) as of September 30, 2010. </div></div> </div>

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<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 13.5pt; font-size: 10pt;" align="left"><b>5.</b>       <b>Derivative Financial Instruments</b> </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          The Company's foreign currency risk management strategy is principally designed to mitigate the potential financial impact of changes in the value of transactions and balances denominated in foreign currency resulting from changes in foreign currency exchange rates. The Company's foreign currency hedging program uses both forward contracts and currency options to manage the foreign currency exposures that exist as part of its ongoing business operations. </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="left"><i>Cash Flow Hedges</i> </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          The Company hedges a portion of its intercompany sales of inventory over a maximum period of 15 months using forward foreign exchange contracts accounted for as cash flow hedges to mitigate the impact of volatility associated with foreign currency transactions. </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          For forward foreign exchange contracts that are designated as cash flow hedges, if they are effective in offsetting the variability of the hedged cash flows, and otherwise meet the hedge accounting criteria, changes in the derivatives value are not included in current earnings but are included in other comprehensive income in stockholders' equity. The changes in fair value will subsequently be reclassified into earnings as a component of cost of revenues, as applicable, when the forecasted transaction occurs. To the extent that a previously forecasted transaction is no longer an effective hedge, any ineffectiveness measured in the hedging relationship is recorded in earnings in the period it occurs. The Company does not enter into derivative instruments for trading or speculative purposes. Realized gains and losses resulting from these cash flow hedges offset the foreign exchange gains and losses on the underlying transactions being hedged. Gains and losses on derivatives not designated for hedge accounting or representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in other income (expense), net. </div></div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          At September 30, 2010, the Company had forward contracts outstanding to hedge cash flow exposure at the Company's wholly-owned Austrian subsidiary, AMSC Windtec GmbH ("AMSC Windtec"), with aggregate USD equivalent notional amounts of $34.4 million. These contracts will expire at various dates through June 2011. The net gain or loss from these cash flow hedges reported in accumulated other comprehensive income will be reclassified to earnings and recorded in cost of revenues in our condensed consolidated statement of income when the related inventory is sold to third-party customers. </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="left"><i>Balance Sheet Hedges</i> </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          In addition to cash flow hedges, the Company also enters into foreign currency forward exchange contracts to mitigate the impact of foreign exchange risk related to non-functional currency receivable balances in its foreign entities. The Company does not elect hedge accounting treatment for these hedges, consequently, changes in the fair value of these contracts are recorded within other income (expense), net, in the period which they occur. At September 30, 2010, the Company had forward contracts outstanding with aggregate USD equivalent notional amounts of $58.9 million, which expired in October 2010. </div> <div style="margin-top: 6pt; font-size: 10pt;" align="justify">          The fair value amounts of asset derivatives included in prepaid expenses and other current assets and liability derivatives included in accounts payable and accrued expenses in our condensed consolidated balance sheets related to forward foreign exchange contracts as of September 30, 2010 and March 31, 2010 were as follows (in thousands): </div> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr valign="bottom"><td width="52%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr><td valign="top" align="left"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="6" nowrap="nowrap" align="center"><b>Asset derivatives</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="6" nowrap="nowrap" align="center"><b>Liability derivatives</b></td> <td> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>March</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"> </td> <td> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td style="border-bottom: #000000 1px solid;"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>31, 2010</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>March 31, 2010</b></td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Derivatives designated as cash flow hedges</div></td> <td> </td> <td align="left">$</td> <td align="right">1,561</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—  </td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—  </td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—  </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Derivatives not designated as cash flow hedges</div></td> <td> </td> <td> </td> <td align="right">889</td> <td> </td> <td> </td> <td> </td> <td align="right">168</td> <td> </td> <td> </td> <td> </td> <td align="right">—  </td> <td> </td> <td> </td> <td> </td> <td align="right">—  </td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Total</div></td> <td> </td> <td align="left">$</td> <td align="right">2,450</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">168</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—  </td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—  </td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td></tr></table></div> <div style="margin-top: 25pt; font-size: 10pt;" align="justify">The Company recognized the following pre-tax gains related to forward foreign exchange contracts designated as cash flow hedges (in thousands): </div> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr valign="bottom"><td width="52%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 2pt;"><td valign="top" align="left"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="6" nowrap="nowrap" align="center"><b>Three months ended</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="6" nowrap="nowrap" align="center"><b>Six months ended</b></td> <td> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September</b></td> <td> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td style="border-bottom: #000000 1px solid;"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>30, 2010</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>30, 2010</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>30, 2009</b></td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Gains recognized in other comprehensive income</div></td> <td> </td> <td align="left">$</td> <td align="right">1,950</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—  </td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">1,758</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—  </td> <td> </td></tr> <tr style="font-size: 25pt;" valign="bottom"><td colspan="17"> </td></tr> <tr style="font-size: 10pt;" valign="bottom"><td colspan="17"> <div align="justify">The Company recognized the following pre-tax gains related to forward foreign exchange contracts not designated as cash flow hedges (in thousands): </div></td></tr></table></div> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr style="font-size: 18pt;" valign="bottom"><td width="53%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="6" nowrap="nowrap" align="center"><b>Three months ended</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="6" nowrap="nowrap" align="center"><b>Six months ended</b></td> <td> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td style="border-bottom: #000000 1px solid;"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>30, 2010</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>30, 2010</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Gains recognized in other expense, net</div></td> <td> </td> <td align="left">$</td> <td align="right">7,994</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">403</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">3,975</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">139</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Gains recognized in cost of revenues</div></td> <td> </td> <td> </td> <td align="right">440</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—  </td> <td> </td> <td> </td> <td> </td> <td align="right">440</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—  </td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Total</div></td> <td> </td> <td align="left">$</td> <td align="right">8,434</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">403</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">4,415</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">139</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="2" nowrap="nowrap" align="right"> </td> <td> </td></tr></table></div> <p style="font-size: 12pt;" align="center"><a href="blank#tocpage"> </a> </p></div> </div>

<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 12pt; font-size: 10pt;" align="justify"><b>2.</b>       <b>Stock-Based Compensation</b> </div> <div style="margin-top: 5pt; font-size: 10pt;" align="justify">          The Company accounts for its stock-based compensation at fair value. The following table summarizes employee stock-based compensation expense by financial statement line item for the three and six months ended September 30, 2010 and 2009 (in thousands):</div> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr valign="bottom"><td width="48%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="7" nowrap="nowrap" align="center"><b>Three months ended</b></td> <td> </td> <td colspan="7" nowrap="nowrap" align="center"><b>Six months ended</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Cost of revenues</div></td> <td> </td> <td align="right">$</td> <td align="right">452</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">354</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">835</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">579</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Research and development</div></td> <td> </td> <td> </td> <td align="right">691</td> <td> </td> <td> </td> <td> </td> <td align="right">523</td> <td> </td> <td> </td> <td> </td> <td align="right">1,159</td> <td> </td> <td> </td> <td> </td> <td align="right">990</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Selling, general and administrative</div></td> <td> </td> <td> </td> <td align="right">3,183</td> <td> </td> <td> </td> <td> </td> <td align="right">2,975</td> <td> </td> <td> </td> <td> </td> <td align="right">5,831</td> <td> </td> <td> </td> <td> </td> <td align="right">5,349</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 45px;" align="left">Total</div></td> <td> </td> <td align="right">$</td> <td align="right">4,326</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">3,852</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">7,825</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">6,918</td> <td> </td></tr> <tr><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td></tr></table></div> <p style="font-size: 12pt;" align="center"> </p> <h5 align="left"><a href="blank#tocpage"> </a></h5> <p> </p><font style="font-size: 10pt;" class="_mt">          During the six months ended September 30, 2010, the Company granted approximately 219,000 shares and 324,000 shares of stock options and restricted stock, respectively, to employees under the 2007 Stock Incentive Plan. The restricted stock awards include approximately 86,000 shares of performance-based restricted stock, which will vest upon achievement of certain annual financial and operational performance measurements. The remaining shares granted vest upon the passage of time, generally 3 years. For awards that vest upon the passage of time, expense is being recorded on a straight-line basis over the vesting period. At September 30, 2010, the Company determined that achievement of the performance measures is probable and as such, is recognizing the fair value of the performance-based awards over the estimated per formance period of each award. </font> <p> </p></div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The total unrecognized compensation cost for unvested employee stock-based compensation awards outstanding, net of estimated forfeitures, was $22.6 million at September 30, 2010. This expense will be recognized over a weighted-average expense period of 2.2 years.</div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The weighted-average assumptions used in the Black-Scholes valuation model for stock options granted during the three and six months ended September 30, 2010 and 2009 are as follows:</div> <div align="left"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="90%"> <tr valign="bottom"><td width="68%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="7" nowrap="nowrap" align="center"><b>Three months ended</b></td> <td nowrap="nowrap">      </td> <td colspan="7" nowrap="nowrap" align="center"><b>Six months ended</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Expected volatility</div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">61.5</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">66.5</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">65.6</td> <td nowrap="nowrap">%</td> <td nowrap="nowrap">      </td> <td nowrap="nowrap" align="right">  </td> <td align="right">70.2</td> <td nowrap="nowrap">%</td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Risk-free interest rate</div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">1.6</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">2.4</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">2.1</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">2.6</td> <td nowrap="nowrap">%</td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Expected life (years)</div></td> <td> </td> <td> </td> <td align="right">6.2</td> <td> </td> <td> </td> <td> </td> <td align="right">4.8</td> <td> </td> <td> </td> <td> </td> <td align="right">6.2</td> <td> </td> <td> </td> <td> </td> <td align="right">4.8</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Dividend yield</div></td> <td> </td> <td colspan="3" align="center">None</td> <td> </td> <td colspan="3" align="center">None</td> <td> </td> <td colspan="3" align="center">None</td> <td> </td> <td colspan="3" align="center">None</td></tr></table></div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The expected volatility was estimated based on an equal weighting of the historical volatility of the Company's common stock and the implied volatility of the Company's traded options. The expected life was estimated based on an analysis of the Company's historical experience of exercise, cancellation, and expiration patterns. The risk-free interest rate is based on the average of the five and seven year U.S. Treasury rates for the three and six months ended September 30, 2010 and the five year U.S. Treasury rates for the three and six months ended September 30, 2009. The stock-based compensation expense recognized in the unaudited condensed consolidated statements of income is based on awards that ultimately are expected to vest; therefore, the amount of expense has been reduced for estimated forfeitures. Forfeitures are es timated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Forfeitures were estimated based on historical experience. This analysis is re-evaluated periodically and the forfeiture rate is adjusted as necessary.</div></div> </div>

0.14

0.10

0.42

0.22

0.14

0.10

0.42

0.22

<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 9pt; font-size: 10pt;" align="justify"><b>3.      Computation of Net Income per Common Share</b> </div> <div style="margin-top: 6pt; font-size: 10pt;" align="justify">          Basic earnings per share ("EPS") is computed by dividing net earnings by the weighted-average number of common shares outstanding for the period. Diluted EPS is computed by dividing the net earnings by the weighted-average number of common shares and dilutive common equivalent shares outstanding during the period, calculated using the treasury stock method. Common equivalent shares include the effect of restricted stock, exercise of stock options and warrants and contingently issuable shares. For the three and six months ended September 30, 2010 and 2009, common equivalent shares of 1.3 million shares and 1.4 million shares, respectively, and 0.9 million shares and 0.8 million shares, respectively, were not included in the calculation of diluted EPS as they were considered anti-dilutive.</div> <div style="margin-top: 6pt; font-size: 10pt;" align="justify">          The following table reconciles the numerators and denominators of the earnings per share calculation for the three and six months ended September 30, 2010 and 2009 (in thousands, except per share data): </div></div> <div style="font-family: 'Times New Roman',Times,serif;"> <div align="left"> <table style="font-size: 9pt;" border="0" cellspacing="0" cellpadding="0" width="98%"> <tr style="font-size: 20pt;" valign="bottom"><td width="52%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 9pt;" valign="bottom"><td> </td> <td> </td> <td colspan="7" nowrap="nowrap" align="center"><b>For the three months ended</b></td> <td> </td> <td colspan="7" nowrap="nowrap" align="center"><b>For the six months ended</b></td></tr> <tr style="font-size: 9pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td> <td style="border-bottom: #000000 1px solid;"> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td></tr> <tr style="font-size: 9pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Numerator:</div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 30px;">Net income</div></td> <td> </td> <td align="right">  $</td> <td align="right">9,988</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">4,340</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">19,157</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">6,132</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 30px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Denominator:</div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 30px;">Weighted-average shares of common stock outstanding</div></td> <td> </td> <td> </td> <td align="right">45,694</td> <td> </td> <td> </td> <td> </td> <td align="right">44,299</td> <td> </td> <td> </td> <td> </td> <td align="right">45,597</td> <td> </td> <td> </td> <td> </td> <td align="right">44,080</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 30px;">Weighted-average shares subject to repurchase</div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(212</td> <td nowrap="nowrap">)  </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(52</td> <td nowrap="nowrap">)  </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(234</td> <td nowrap="nowrap">)  </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(60</td> <td nowrap="nowrap">)  </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 30px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Shares used in per-share calculation — basic</div></td> <td> </td> <td> </td> <td align="right">45,482</td> <td> </td> <td> </td> <td> </td> <td align="right">44,247</td> <td> </td> <td> </td> <td> </td> <td align="right">45,363</td> <td> </td> <td> </td> <td> </td> <td align="right">44,020</td> <td> </td></tr> <tr><td valign="top" align="left"> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 30px;">Dilutive effect of employee equity incentive plans</div></td> <td> </td> <td> </td> <td align="right">735</td> <td> </td> <td> </td> <td> </td> <td align="right">986</td> <td> </td> <td> </td> <td> </td> <td align="right">737</td> <td> </td> <td> </td> <td> </td> <td align="right">902</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 30px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Shares used in per-share calculation — diluted</div></td> <td> </td> <td> </td> <td align="right">46,217</td> <td> </td> <td> </td> <td> </td> <td align="right">45,233</td> <td> </td> <td> </td> <td> </td> <td align="right">46,099</td> <td> </td> <td> </td> <td> </td> <td align="right">44,922</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 30px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Net income per share — basic</div></td> <td> </td> <td align="right">  $</td> <td align="right">0.22</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">0.10</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">0.42</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">0.14</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 30px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Net income per share — diluted</div></td> <td> </td> <td align="right">  $</td> <td align="right">0.22</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">0.10</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">0.42</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">0.14</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 30px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td></tr></table></div></div> </div>

2229000

2620000

6918000

7825000

<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 18pt; font-size: 10pt;" align="left"><b>4.</b>       <b>Fair Value Measurements</b> </div> <div style="margin-top: 12pt; font-size: 10pt;" align="justify">          The accounting standard for fair value measurements provides a framework for measuring fair value and requires expanded disclosure regarding fair value measurements. Fair value is defined as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The accounting standard established a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. This hierarchy prioritizes the inputs into three broad levels as follows: </div> <div style="margin-top: 12pt; font-size: 10pt;" align="left"><b><i>Valuation Hierarchy</i></b> </div> <div style="margin-top: 12pt;" align="center"> <table style="background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="86%"> <tr><td width="3%"> </td> <td width="1%"> </td> <td> </td></tr> <tr valign="top"><td nowrap="nowrap" align="left"><b>Level 1  - </b></td> <td> </td> <td> <div align="justify">Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.</div></td></tr></table></div> <div style="margin-top: 6pt;" align="center"> <table style="background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="86%"> <tr><td width="3%"> </td> <td width="1%"> </td> <td> </td></tr> <tr valign="top"><td nowrap="nowrap" align="left"><b>Level 2  - </b></td> <td> </td> <td> <div align="justify">Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).</div></td></tr></table></div> <div style="margin-top: 6pt;" align="center"> <table style="background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="86%"> <tr><td width="3%"> </td> <td width="1%"> </td> <td> </td></tr> <tr valign="top"><td nowrap="nowrap" align="left"><b>Level 3  - </b></td> <td> </td> <td> <div align="justify">Unobservable inputs that reflect the Company's assumptions that market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available, including its own data.</div></td></tr></table></div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          A financial asset's or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The following table provides the assets carried at fair value, measured as of September 30, 2010 and March 31, 2010 (in thousands): </div></div> <div style="font-family: 'Times New Roman',Times,serif;"> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr style="font-size: 10pt;" valign="bottom"><td width="52%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Total</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Quoted Prices in</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Using Significant Other</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Using Significant</b></td> <td> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Carrying</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Active Markets</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Observable Inputs</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Unobservable Inputs</b></td> <td> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>Value</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center">(<b>Level 1)</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center">(<b>Level 2)</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center">(<b>Level 3)</b></td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">September 30, 2010:</div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Cash equivalents</div></td> <td> </td> <td align="right">  $</td> <td align="right">7,524</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">7,524</td> <td> </td> <td> </td> <td align="right">  $</td> <td nowrap="nowrap" align="right">—   </td> <td> </td> <td> </td> <td align="right">  $</td> <td nowrap="nowrap" align="right">—   </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Derivatives</div></td> <td> </td> <td> </td> <td align="right">2,450</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td> <td> </td> <td> </td> <td align="right">2,450</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Short-term marketable securities</div></td> <td> </td> <td> </td> <td align="right">69,218</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td> <td> </td> <td> </td> <td align="right">69,218</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Long-term marketable securities</div></td> <td> </td> <td> </td> <td align="right">3,900</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td> <td> </td> <td> </td> <td align="right">3,900</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td></tr> <tr style="font-size: 20pt;" valign="bottom"><td> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Total</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Quoted Prices in</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Using Significant Other</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Using Significant</b></td> <td> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Carrying</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Active Markets</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Observable Inputs</b></td> <td> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>Unobservable Inputs</b></td> <td> </td></tr> <tr style="font-size: 8pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"><b>Value</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center">(<b>Level 1)</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center">(<b>Level 2)</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center">(<b>Level 3)</b></td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">March 31, 2010:</div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Cash equivalents</div></td> <td> </td> <td align="right">  $</td> <td align="right">29,054</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">29,054</td> <td> </td> <td> </td> <td align="right">  $</td> <td nowrap="nowrap" align="right">—   </td> <td> </td> <td> </td> <td align="right">  $</td> <td nowrap="nowrap" align="right">—   </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Derivatives </div></td> <td> </td> <td> </td> <td align="right">168</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td> <td> </td> <td> </td> <td align="right"> 168</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Short-term marketable securities</div></td> <td> </td> <td> </td> <td align="right">54,469</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td> <td> </td> <td> </td> <td align="right">54,469</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Long-term marketable securities</div></td> <td> </td> <td> </td> <td align="right">7,342</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td> <td> </td> <td> </td> <td align="right">7,342</td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">—   </td> <td> </td></tr></table></div> <div style="margin-top: 10pt; font-size: 10pt;" align="left"><b><i>Valuation Techniques</i></b> </div> <div style="margin-top: 10pt; font-size: 10pt;" align="justify"><i>Cash Equivalents</i> </div> <div style="margin-top: 10pt; font-size: 10pt;" align="justify">          Cash equivalents consist of highly liquid instruments with maturities of three months or less that are regarded as high quality, low risk investments and are measured using such inputs as quoted prices, and are classified within Level 1 of the valuation hierarchy. Cash equivalents consist principally of money market accounts and corporate debt instruments. </div> <div style="margin-top: 10pt; font-size: 10pt;" align="left"><i>Marketable Securities</i> </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          Long-term and short-term marketable securities consist primarily of government-backed securities and sovereign debt are measured using such inputs as quoted prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable for the asset (for example, interest rates and yield curves observable at commonly quoted intervals), and inputs that are derived principally from or corroborated by observable market data by correlation or other means, and are classified within Level 2 of the valuation hierarchy. Short-term marketable securities have maturities of greater than three months from original purchase date but less than twelve months from the date of the balance sheet. All marketable securities are considered available-for-sale and are carried at fair value. The Company periodically revi ews the realizability of each short-term and long-term marketable security when impairment indicators exist with respect to the security. If an other-than-temporary impairment of value of the security exists, the carrying value of the security is written down to its estimated fair value. </div></div> </div>

36696000

47508000

14307000

9649000

35010000

18584000

<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 20pt; font-size: 10pt;" align="left"><b>9.</b>       <b>Income Taxes</b> </div> <div style="margin-top: 6pt; font-size: 10pt;" align="justify">          The Company recorded income tax expense of $8.6 million and $15.9 million for the three and six months ended September 30, 2010, respectively, and $5.3 million and $8.2 million for the three and six months ended September 30, 2009, respectively, related primarily to income generated in foreign jurisdictions. The Company has provided a valuation allowance against all deferred tax assets in the U.S. as it is more likely than not that its U.S. deferred tax assets are not currently realizable due to the net operating losses incurred by the Company in the U.S. since its inception. </div></div> </div>

2531000

6925000

8175000

5309000

15853000

8596000

-4810000

8011000

3010000

-36953000

-567000

7820000

6235000

-8934000

712000

-6408000

546000

-253000

7770000

7966000

433000

190000

367000

191000

<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 10pt; font-size: 10pt;" align="left"><b>7.</b>       <b>Inventory</b> </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          The components of inventory are as follows (in thousands): </div> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="91%"> <tr valign="bottom"><td width="76%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="3" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td colspan="3" nowrap="nowrap" align="center"><b>March 31,</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td nowrap="nowrap">   </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Raw materials</div></td> <td> </td> <td align="right">   $</td> <td align="right">20,919</td> <td> </td> <td> </td> <td align="right">   $</td> <td align="right">18,065</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Work-in-process</div></td> <td> </td> <td> </td> <td align="right">5,668</td> <td> </td> <td> </td> <td> </td> <td align="right">7,318</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Finished goods</div></td> <td> </td> <td> </td> <td align="right">14,886</td> <td> </td> <td> </td> <td> </td> <td align="right">7,879</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Deferred program costs</div></td> <td> </td> <td> </td> <td align="right">3,768</td> <td> </td> <td> </td> <td> </td> <td align="right">2,596</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 45px;" align="left">Net inventory</div></td> <td> </td> <td align="right">   $</td> <td align="right">45,241</td> <td> </td> <td> </td> <td align="right">   $</td> <td align="right">35,858</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td></tr></table></div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          Finished goods inventory as of September 30, 2010 includes $5.7 million of costs of product shipped to customers on contracts for which revenue was deferred until final customer acceptance. </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          Deferred program costs as of September 30, 2010 and March 31, 2010 primarily represent costs incurred on wind turbine development programs accounted for under contract accounting where the Company needs to achieve certain milestones or complete development programs before revenue and costs will be recognized. </div></div> </div>

119219000

139657000

400184000

465235000

104760000

120877000

54469000

69218000

7342000

3900000

4068000

1574000

-11906000

-37295000

21687000

-1878000

6132000

4340000

19157000

9988000

130951000

64342000

166714000

85584000

16721000

10330000

32025000

15945000

<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 12pt; font-size: 10pt;" align="justify"><b>1.</b>       <b>Description of the Business and Basis of Presentation</b> </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          American Superconductor Corporation (the "Company" or "AMSC") was founded on April 9, 1987. The Company offers an array of proprietary technologies and solutions spanning the electric power infrastructure — from generation to delivery to end use. The Company is a leader in renewable energy, providing proven, megawatt-scale wind turbine designs and electrical control systems. The Company also offers a host of Smart Grid technologies for power grid operators that enhance the reliability, efficiency and capacity of the power grid, and seamlessly integrate renewable energy sources into the power infrastructure. These technologies include superconductor power cable systems, grid-level surge protectors and power electronics-based voltage stabilization systems. The Company operates in two business segments: AMSC Power Systems and AMSC Superconductors.</div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          These unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the Securities and Exchange Commission's ("SEC") instructions to Form 10-Q. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States ("GAAP") have been condensed or omitted pursuant to those instructions. The year-end condensed balance sheet data was derived from audited financial statements but does not include all disclosures required by generally accepted accounting principles in the United States of America. The unaudited condensed consolidated financial statements, in the opinion of management, reflect all adjustments (consisting of normal recurring adjustments) necessary for a fair statement of the resul ts for the interim periods ended September 30, 2010 and 2009 and the financial position at September 30, 2010. The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions are eliminated in consolidation.</div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The results of operations for an interim period are not necessarily indicative of the results of operations to be expected for the fiscal year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the fiscal year ended March 31, 2010 (fiscal 2009) which are contained in the Company's Annual Report on Form 10-K, filed with the SEC on May 27, 2010.</div> <div style="margin-top: 5pt; font-size: 10pt;" align="justify">          The Company has performed an evaluation of subsequent events through the time of filing this Quarterly Report on Form 10-Q with the SEC.</div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify"><b>Recently Adopted Accounting Pronouncements</b> </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          In October 2009, the FASB issued Accounting Standards Update (ASU) No. 2009-13, <i>Multiple-Deliverable Revenue Arrangements, </i>pertaining to the accounting for revenue arrangements with multiple deliverables. Specifically, the new standard requires an entity to allocate consideration at the inception of an arrangement to all of its deliverables based on their relative selling prices. In the absence of the vendor-specific objective evidence or third-party evidence of the selling prices, consideration must be allocated to the deliverables based on management's best estimate of the selling prices. In addition, the new standard eliminates the use of the residual method of allocation. The new accounting standard supersedes the prior multiple element revenue arrangement accounting rules that were previously used by the Company. The Company adopted this new accounting standard on April 1, 2010 using the prospective method and the adoption did not have a material impact on its condensed consolidated financial statements.</div></div> </div>

18024000

30506000

1319000

1463000

7305000

3248000

4190000

16525000

-110000

-19000

-55000

-33000

380000

418000

382000

1107000

-2847000

-871000

2618000

2448000

617000

182000

8000000

843000

1615000

40533000

25283000

2741000

17950000

4068000

1574000

33374000

15482000

<div> <div style="font-family: 'Times New Roman',Times,serif;" align="right"> <div style="margin-top: 17.5pt; font-family: 'Times New Roman',Times,serif; font-size: 10pt;" align="left"><b>8.</b>       <b>Product Warranty</b> </div> <div style="margin-top: 4.5pt; font-family: 'Times New Roman',Times,serif; font-size: 10pt;" align="justify">          The Company generally provides a one to two year warranty on its products, commencing upon installation. A provision is recorded upon revenue recognition to cost of revenues for estimated warranty expense based on historical experience. </div> <div style="margin-top: 9pt; font-family: 'Times New Roman',Times,serif; font-size: 10pt;" align="justify">          Product warranty activity was as follows (in thousands): </div> <div style="font-family: 'Times New Roman',Times,serif;" align="left"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%"> <tr valign="bottom"><td width="49%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="7" nowrap="nowrap" align="center"><b>Three months ended</b></td> <td> </td> <td colspan="7" nowrap="nowrap" align="center"><b>Six months ended</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td></tr> <tr style="font-size: 1pt;"><td valign="top" align="left"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td></tr> <tr style="font-size: 1pt;"><td valign="top" align="left"> </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Balance at beginning of period</div></td> <td> </td> <td> </td> <td align="right">$6,375</td> <td> </td> <td> </td> <td> </td> <td align="right">$5,325</td> <td> </td> <td> </td> <td> </td> <td align="right">$6,431</td> <td> </td> <td> </td> <td> </td> <td align="right">$4,749</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Accruals for warranties during the period</div></td> <td> </td> <td> </td> <td align="right">2,020</td> <td> </td> <td> </td> <td> </td> <td align="right">1,602</td> <td> </td> <td> </td> <td> </td> <td align="right">4,332</td> <td> </td> <td> </td> <td> </td> <td align="right">2,717</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Settlements and adjustments during the period</div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,021)</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,430)</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(3,389)</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,969)</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;">Balance at end of period</div></td> <td> </td> <td> </td> <td align="right">$7,374</td> <td> </td> <td> </td> <td> </td> <td align="right">$5,497</td> <td> </td> <td> </td> <td> </td> <td align="right">$7,374</td> <td> </td> <td> </td> <td> </td> <td align="right">$5,497</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td></tr></table></div></div> </div>

64315000

78160000

52000

959000

<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 19pt; font-size: 10pt;" align="left"><b>11.</b>     <b>Cost-Sharing Arrangements</b> </div> <div style="margin-top: 6pt; font-size: 10pt;" align="justify">          The Company has entered into several cost-sharing arrangements with various agencies of the United States government. Funds paid to the Company under these agreements are not reported as revenues but are used to directly offset the Company's research and development ("R&D") and selling, general and administrative ("SG&A") expenses, and to purchase capital equipment. </div> <div style="margin-top: 6pt; font-size: 10pt;" align="justify">          Costs incurred and funding received under these agreements are as follows (in thousands): </div> <div align="right"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%"> <tr valign="bottom"><td width="52%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="6" nowrap="nowrap" align="center"><b>Three months ended</b></td> <td> </td> <td> </td> <td colspan="6" nowrap="nowrap" align="center"><b>Six months ended</b></td> <td> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="6" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="6" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td></tr> <tr style="font-size: 1pt;"><td valign="top" align="left"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="2" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="2" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="2" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="2" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td></tr> <tr style="font-size: 1pt;"><td valign="top" align="left"> </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"> </td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"> </td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"> </td> <td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="2" nowrap="nowrap" align="center"> </td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Costs incurred</div></td> <td> </td> <td align="right">  $</td> <td align="right">499</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">1,004</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">1,024</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">2,475</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">R&D expenditures offset by cost sharing funding received</div></td> <td> </td> <td> </td> <td align="right">133</td> <td> </td> <td> </td> <td> </td> <td align="right">227</td> <td> </td> <td> </td> <td> </td> <td align="right">274</td> <td> </td> <td> </td> <td> </td> <td align="right">617</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">SG&A expenditures offset by cost sharing funding received</div></td> <td> </td> <td> </td> <td align="right">116</td> <td> </td> <td> </td> <td> </td> <td align="right">198</td> <td> </td> <td> </td> <td> </td> <td align="right">238</td> <td> </td> <td> </td> <td> </td> <td align="right">538</td> <td> </td></tr></table></div> <div style="margin-top: 19pt; font-size: 10pt;" align="justify">          At September 30, 2010, total funding received to date under these agreements was $30.2 million. </div></div> </div>

9944000

5416000

15192000

7857000

5713000

5484000

451000

117000

-410889000

-391732000

147672000

74672000

198739000

101529000

<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 12pt; font-size: 10pt;" align="left"><b>6.</b>       <b>Accounts Receivable</b> </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          Accounts receivable consisted of the following (in thousands): </div> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="91%"> <tr valign="bottom"><td width="76%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="3" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td colspan="3" nowrap="nowrap" align="center"><b>March 31,</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td nowrap="nowrap">   </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Accounts receivable (billed)</div></td> <td> </td> <td align="right">   $</td> <td align="right">93,941</td> <td> </td> <td> </td> <td align="right">   $</td> <td align="right">53,430</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Accounts receivable (unbilled)</div></td> <td> </td> <td> </td> <td align="right">4,964</td> <td> </td> <td> </td> <td> </td> <td align="right">10,305</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Less: Allowance for doubtful accounts</div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(2,863</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,532</td> <td nowrap="nowrap">)</td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 45px;" align="left">Accounts receivable, net</div></td> <td> </td> <td align="right">   $</td> <td align="right">96,042</td> <td> </td> <td> </td> <td align="right">   $</td> <td align="right">62,203</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td></tr></table></div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The Company also recorded net long-term accounts receivable of $17.8 million and $14.1 million as of September 30, 2010 and March 31, 2010, respectively, which are also classified within other assets and long-term deferred revenue on the condensed consolidated balance sheet. </div></div> </div>

<div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 29pt; font-size: 10pt;" align="left"><b>13.</b>     <b>Business Segment Information</b> </div> <div style="margin-top: 4.5pt; font-size: 10pt;" align="justify">          The Company reports its financial results in two reportable business segments: AMSC Power Systems and AMSC Superconductors. </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The AMSC Power Systems business segment produces a broad range of products to increase electrical grid capacity and reliability, supplies electrical systems used in wind turbines, provides power electronic products that interconnect wind farms and solar power plants to the power grid, licenses proprietary wind turbine designs to manufacturers of such systems, provides consulting services to the wind industry, and offers products that enhance power quality for industrial operations. </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The AMSC Superconductors business segment manufactures high temperature superconductor (HTS) wire and coils; designs and develops superconductor products, such as power cables, fault current limiters and motors; and manages large-scale superconductor projects. </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          The operating results for the two business segments are as follows (in thousands): </div> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="91%"> <tr valign="bottom"><td width="48%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 2pt;"><td valign="top" align="left"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="7" nowrap="nowrap" align="center"><b>Three months ended</b></td> <td> </td> <td colspan="7" nowrap="nowrap" align="center"><b>Six months ended</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td></tr> <tr style="font-size: 1pt;"><td valign="top" align="left"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td></tr> <tr style="font-size: 1pt;"><td valign="top" align="left"> </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left"><u><b>Revenues</b></u>:</div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">AMSC Power Systems</div></td> <td> </td> <td> </td> <td align="right">$98,540</td> <td> </td> <td> </td> <td> </td> <td align="right">$71,791</td> <td> </td> <td> </td> <td> </td> <td align="right">$193,468</td> <td> </td> <td> </td> <td> </td> <td align="right">$142,487</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">AMSC Superconductors</div></td> <td> </td> <td> </td> <td align="right">2,989</td> <td> </td> <td> </td> <td> </td> <td align="right">2,881</td> <td> </td> <td> </td> <td> </td> <td align="right">5,271</td> <td> </td> <td> </td> <td> </td> <td align="right">5,185</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 45px;" align="left">Total</div></td> <td> </td> <td> </td> <td align="right">$101,529</td> <td> </td> <td> </td> <td> </td> <td align="right">$74,672</td> <td> </td> <td> </td> <td> </td> <td align="right">$198,739</td> <td> </td> <td> </td> <td> </td> <td align="right">$147,672</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr style="font-size: 12pt;" valign="bottom"><td> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="6" nowrap="nowrap" align="center"><b>Three months ended</b></td> <td> </td> <td> </td> <td colspan="6" nowrap="nowrap" align="center"><b>Six months ended</b></td> <td> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="7" nowrap="nowrap" align="center"><b>September 30,</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 0px solid;" colspan="3" nowrap="nowrap" align="center"><b>2009</b></td></tr> <tr style="font-size: 1pt;"><td valign="top" align="left"> </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left"><u><b>Operating income</b></u><b>:</b></div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">AMSC Power Systems</div></td> <td> </td> <td> </td> <td align="right">$26,842</td> <td> </td> <td> </td> <td> </td> <td align="right">$19,866</td> <td> </td> <td> </td> <td> </td> <td align="right">$52,327</td> <td> </td> <td> </td> <td> </td> <td align="right">$35,261</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">AMSC Superconductors</div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(6,533</td> <td>)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(5,647</td> <td>)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(12,444</td> <td>)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(11,144</td> <td>)</td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Unallocated corporate expenses</div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(4,364</td> <td>)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(3,889</td> <td>)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(7,858</td> <td>)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(7,396</td> <td>)</td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 45px;" align="left">Total</div></td> <td> </td> <td> </td> <td align="right">$15,945</td> <td> </td> <td> </td> <td> </td> <td align="right">$10,330</td> <td> </td> <td> </td> <td> </td> <td align="right">$32,025</td> <td> </td> <td> </td> <td> </td> <td align="right">$16,721</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td></tr></table></div> <p style="font-size: 12pt;" align="center"> </p> <h5 align="left"><a href="blank#tocpage"> </a></h5> <p> </p><font style="font-size: 10pt;" class="_mt">          The accounting policies of the business segments are the same as those for the consolidated Company, except that certain corporate expenses which the Company does not believe are specifically attributable or allocable to either of the two business segments have been excluded from the segment operating income. Unallocated corporate expenses include stock-based compensation expense of $4.3 million and $3.9 million for the three months ended September 30, 2010 and 2009, respectively, and $7.8 million and $6.9 million for the six months ended September 30, 2010 and 2009, respectively. Unallocated corporate expenses for the three and six months ended September 30, 2009 included $0.1 million and $0.5 million, respectively, of restructuring charges related primarily to the closure of the Company's facility in Westborough, Massachusetts. </font> <p> </p></div> <div style="font-family: 'Times New Roman',Times,serif;"> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          For the three and six months ended September 30, 2010, a substantial portion of the Company's revenues was derived from one customer: Sinovel Wind Co., Ltd., a manufacturer of wind turbines based in China. Sales to Sinovel represented 79% and 76% of total revenues for the three and six months ended September 30, 2010, respectively, compared to 76% and 65% for the three and six months ended September 30, 2009, respectively. </div> <div style="margin-top: 9pt; font-size: 10pt;" align="justify">          Total assets for the two business segments are as follows (in thousands): </div> <div align="center"> <table style="font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr valign="bottom"><td width="70%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td colspan="3" nowrap="nowrap" align="center"><b>September 30,</b></td> <td> </td> <td colspan="3" nowrap="nowrap" align="center"><b>March 31,</b></td></tr> <tr style="font-size: 7.5pt;" valign="bottom"><td> </td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td style="border-bottom: #000000 1px solid;" colspan="3" nowrap="nowrap" align="center"><b>2010</b></td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">AMSC Power Systems</div></td> <td> </td> <td align="right">  $</td> <td align="right">256,790</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">179,873</td> <td> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">AMSC Superconductors</div></td> <td> </td> <td> </td> <td align="right">45,547</td> <td> </td> <td> </td> <td> </td> <td align="right">32,978</td> <td> </td></tr> <tr style="background: #cceeff;" valign="bottom"><td> <div style="text-indent: -15px; margin-left: 15px;" align="left">Corporate assets</div></td> <td> </td> <td> </td> <td align="right">162,898</td> <td> </td> <td> </td> <td> </td> <td align="right">187,333</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 1px solid;" colspan="3" nowrap="nowrap" align="right"> </td></tr> <tr valign="bottom"><td> <div style="text-indent: -15px; margin-left: 45px;" align="left">Total</div></td> <td> </td> <td align="right">  $</td> <td align="right">465,235</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">400,184</td> <td> </td></tr> <tr style="font-size: 1px;"><td> <div style="text-indent: -15px; margin-left: 15px;"> </div></td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td> <td> </td> <td style="border-top: #000000 3px double;" colspan="3" nowrap="nowrap" align="right"> </td></tr></table></div></div> </div>

23597000

12712000

32310000

17127000

280965000

325578000

44922000

45233000

46099000

46217000

44020000

44247000

45363000

45482000