UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended   September 30, 2020
or
[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                                   to                                    

Commission File Number: 000-12196
 
NVE Logo
NVE CORPORATION
(Exact name of registrant as specified in its charter)
 
Minnesota 41-1424202
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
 
11409 Valley View Road, Eden Prairie, Minnesota   55344
(Address of principal executive offices)   (Zip Code)
 
 (952) 829-9217 
(Registrant’s telephone number, including area code)
 
     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
[X] Yes  [   ] No

     Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
[X] Yes  [   ] No

     Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
      Large accelerated filer [   ]
Accelerated filer [   ]
Non-accelerated filer [X]
Smaller reporting company [X]
  Emerging growth company [   ]  
 
     If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [   ]
 
     Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     [   ] Yes  [X] No

     Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading symbol(s) Name of each exchange on which registered
Common Stock, $0.01 par value NVEC The NASDAQ Stock Market, LLC
 
     Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Common Stock, $0.01 Par Value – 4,833,232 shares outstanding as of October 16, 2020
 

 
NVE CORPORATION
QUARTERLY REPORT ON FORM 10-Q
TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

     Item 1. Financial Statements

          Balance Sheets

          Statements of Income for the Quarters Ended September 30, 2020 and 2019

          Statements of Comprehensive Income for the Quarters Ended September 30, 2020 and 2019

          Statements of Income for the Six Months Ended September 30, 2020 and 2019

          Statements of Comprehensive Income for the Six Months Ended September 30, 2020 and 2019

          Statements of Shareholders’ Equity for the Period Ended September 30, 2020

          Statements of Shareholders’ Equity for the Period Ended September 30, 2019

          Statements of Cash Flows

          Notes to Financial Statements

     Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

     Item 4. Controls and Procedures

PART II. OTHER INFORMATION

     Item 1. Legal Proceedings

     Item 1A. Risk Factors

     Item 4. Mine Safety Disclosures

     Item 6. Exhibits

SIGNATURES


2

Table of Contents

PART I–FINANCIAL INFORMATION


Item 1. Financial Statements.
NVE CORPORATION
BALANCE SHEETS

 
(Unaudited)
September 30, 2020
March 31, 2020*
ASSETS
Current assets
Cash and cash equivalents
$ 3,845,070     $ 8,065,594
Marketable securities, short-term
23,231,981       19,084,814
Accounts receivable, net of allowance for uncollectible accounts of $15,000
  1,922,076       2,694,018
Inventories
  3,928,524       3,884,450
Prepaid expenses and other assets
610,635     655,835  
Total current assets   33,538,286     34,384,711  
Fixed assets
Machinery and equipment 
  9,280,062     9,280,062
Leasehold improvements
1,797,245     1,797,245  
  11,077,307       11,077,307
Less accumulated depreciation and amortization 
10,648,191     10,494,840  
Net fixed assets   429,116       582,467
Deferred tax assets -   108,119  
Marketable securities, long-term 40,777,322   43,606,495
Right-of-use asset – operating lease 752,861     816,358  
Total assets $ 75,497,585     $ 79,498,150  
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable
$ 154,566     $ 186,993
Accrued payroll and other
424,957     482,074
Operating lease
113,666     127,134
Total current liabilities   693,189       796,201
Deferred tax liabilities   141,990   -
Operating lease 644,987     706,600  
Total liabilities 1,480,166 1,502,801
 
Shareholders’ equity
Common stock, $0.01 par value, 6,000,000 shares authorized; 4,833,232 issued
and outstanding as of September 30, 2020 and 4,835,038 as of March 31, 2020
48,332 48,350
Additional paid-in capital
19,329,577 19,383,956
Accumulated other comprehensive income
1,628,861   516,523  
Retained earnings
53,010,649   58,046,520  
Total shareholders’ equity 74,017,419   77,995,349  
Total liabilities and shareholders’ equity $ 75,497,585   $ 79,498,150  

*The March 31, 2020 Balance Sheet is derived from the audited financial statements contained in our Annual Report on Form 10-K for the fiscal year ended March 31, 2020.

 
See accompanying notes.

 
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NVE CORPORATION
STATEMENTS OF INCOME
(Unaudited
)

Quarter Ended September 30
2020 2019
Revenue
Product sales
$ 4,159,173 $ 6,187,708  
Contract research and development
221,612   314,237  
Total revenue   4,380,785   6,501,945
Cost of sales 941,287   1,346,098  
Gross profit   3,439,498   5,155,847
Expenses
Research and development
  815,965   926,596
Selling, general, and administrative
358,182   368,450  
Total expenses 1,174,147   1,295,046  
Income from operations   2,265,351   3,860,801
Interest income 401,392   456,309  
Income before taxes   2,666,743   4,317,110
Provision for income taxes 444,403   495,048  
Net income $ 2,222,340     $ 3,822,062  
Net income per share – basic $ 0.46     $ 0.79  
Net income per share – diluted $ 0.46     $ 0.79  
Cash dividends declared per common share $ 1.00     $ 1.00  
Weighted average shares outstanding
Basic
  4,834,709 4,846,010
Diluted
  4,834,809 4,847,881


STATEMENTS OF COMPREHENSIVE INCOME
     (Unaudited)

Quarter Ended September 30
2020 2019
Net income $ 2,222,340 $ 3,822,062
Unrealized (loss) gain from marketable securities, net of tax   (130,324 ) 178,716  
Comprehensive income $ 2,092,016   $ 4,000,778  
 
 
See accompanying notes.


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NVE CORPORATION
STATEMENTS OF INCOME
(Unaudited)
 
Six Months Ended Sept. 30
2020 2019
Revenue
Product sales
$ 8,517,808 $ 12,273,072  
Contract research and development
452,239   523,569  
Total revenue   8,970,047   12,796,641  
Cost of sales 1,777,709   2,438,135  
Gross profit   7,192,338     10,358,506  
Expenses
Research and development
  1,696,948   1,899,663
Selling, general, and administrative
713,193   698,459  
Total expenses 2,410,141   2,598,122  
Income from operations   4,782,197   7,760,384
Interest income 800,604   915,348  
Income before taxes   5,582,801   8,675,732
Provision for income taxes 948,596   1,246,251  
Net income $ 4,634,205   $ 7,429,481  
Net income per share – basic $ 0.96   $ 1.53  
Net income per share – diluted $ 0.96   $ 1.53  
Cash dividends declared per common share $ 2.00   $ 2.00  
Weighted average shares outstanding
Basic
4,834,872 4,846,010
Diluted
4,834,986 4,849,357


STATEMENTS OF COMPREHENSIVE INCOME
     (Unaudited)
 
Six Months Ended Sept. 30
2020 2019
Net income $ 4,634,205 $ 7,429,481
Unrealized gain from marketable securities, net of tax   1,112,338   748,779  
Comprehensive income $ 5,746,543 $ 8,178,260
 

See accompanying notes.

 
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NVE CORPORATION
STATEMENTS OF SHAREHOLDERS’ EQUITY
(Unaudited)
 
 
 
 
Additional
Paid-In
Capital
    Accumulated
Other
Comprehen-
sive
Income
  Retained
Earnings
   
Common Stock
Shares   Amount Total
Balance as of March 31, 2020 4,835,038   $ 48,350   $ 19,383,956     $ 516,523     $ 58,046,520     $ 77,995,349  
Comprehensive income:
Unrealized gain on
marketable securities,
net of tax
                    1,242,662   1,242,662  
Net income
                            2,411,865       2,411,865  
Total comprehensive income
                                    3,654,527  
Stock-based compensation
            2,707                       2,707  
Cash dividends declared
($1.00 per share of
common stock)
                      (4,835,038 )   (4,835,038 )
Balance as of June 30, 2020 4,835,038 $ 48,350 $ 19,386,663 $ 1,759,185   $ 55,623,347   $ 76,817,545  
Repurchase of common stock
(1,806 )   (18 )   (91,401 )                     (91,419 )
Comprehensive income:
Unrealized loss on
marketable securities,
net of tax
                    (130,324 ) (130,324 )
Net income
                            2,222,340       2,222,340  
Total comprehensive income
                                    2,092,016  
Stock-based compensation
  34,315 34,315  
Cash dividends declared
($1.00 per share of
common stock)
                      (4,835,038 )   (4,835,038 )
Balance as of September 30, 2020 4,833,232 $ 48,332 $ 19,329,577 $ 1,628,861   $ 53,010,649     $ 74,017,419  
 
 
See accompanying notes.


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NVE CORPORATION
STATEMENTS OF SHAREHOLDERS’ EQUITY
(Unaudited)
 
 
 
 
Additional
Paid-In
Capital
    Accumulated
Other
Comprehen-
sive Income
(Loss)
  Retained
Earnings
   
Common Stock
Shares   Amount Total
Balance as of March 31, 2019 4,846,010 $ 48,460 $ 19,910,558   $ (82,725 ) $ 62,903,918 $ 82,780,211
Comprehensive income:
Unrealized gain on
marketable securities,
net of tax
570,063 570,063
Net income
3,607,419   3,607,419  
Total comprehensive income
4,177,482
Cash dividends declared
($1.00 per share of
common stock)
            (4,846,010 ) (4,846,010 )
Balance as of June 30, 2019 4,846,010   48,460   19,910,558   487,338     61,665,327     82,111,683  
Comprehensive income:
Unrealized gain on
marketable securities,
net of tax
                    178,716   178,716
Net income
                            3,822,062       3,822,062  
Total comprehensive income
                                    4,000,778
Stock-based compensation
            48,360                       48,360  
Cash dividends declared
($1.00 per share of
common stock)
                      (4,846,010 )   (4,846,010 )
Balance as of September 30, 2019 4,846,010   $ 48,460   $ 19,958,918     $ 666,054     $ 60,641,379     $ 81,314,811  
 
 
See accompanying notes.


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NVE CORPORATION
STATEMENTS OF CASH FLOWS
(Unaudited)
 
Six Months Ended Sept. 30
2020 2019
OPERATING ACTIVITIES
Net income $ 4,634,205 $ 7,429,481
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization
259,241 266,916
Stock-based compensation
37,022 48,360
Deferred income taxes
(61,437 ) 75,521  
Changes in operating assets and liabilities:
Accounts receivable
771,942 (220,147 )
Inventories
(44,074 ) (90,456 )
Prepaid expenses and other assets
108,697   41,687  
Accounts payable and other liabilities
(164,625 ) (130,726 )
Net cash provided by operating activities 5,540,971 7,420,636
 
INVESTING ACTIVITIES
Purchases of fixed assets - (16,100 )
Purchases of marketable securities - (3,013,530 )
Proceeds from maturities of marketable securities -       12,500,000  
Cash provided by investing activities   -       9,470,370  
 
FINANCING ACTIVITIES
Repurchase of common stock (91,419 )   -
Payment of dividends to shareholders   (9,670,076 )     (9,692,020 )
Cash used in financing activities   (9,761,495 )     (9,692,020 )
 
(Decrease) increase in cash and cash equivalents (4,220,524 ) 7,198,986  
Cash and cash equivalents at beginning of period 8,065,594     6,877,304  
 
Cash and cash equivalents at end of period $ 3,845,070     $ 14,076,290  
 
Supplemental disclosures of cash flow information:
Cash paid during the period for income taxes
$ 934,788     $ 1,230,000  
 
 
See accompanying notes.


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NVE CORPORATION
NOTES TO FINANCIAL STATEMENTS
(Unaudited)

NOTE 1. DESCRIPTION OF BUSINESS
     We develop and sell devices that use spintronics, a nanotechnology that relies on electron spin rather than electron charge to acquire, store, and transmit information.

NOTE 2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
     The accompanying unaudited financial statements of NVE Corporation are prepared consistent with accounting principles generally accepted in the United States and in accordance with Securities and Exchange Commission rules and regulations. In the opinion of management, these financial statements reflect all adjustments, consisting only of normal and recurring adjustments, necessary for a fair presentation of the financial statements. Although we believe that the disclosures are adequate to make the information presented not misleading, certain disclosures have been omitted as allowed, and it is suggested that these unaudited financial statements be read in conjunction with the audited financial statements and the notes included in our latest annual financial statements included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2020. The results of operations for the quarter and six months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the full fiscal year ending March 31, 2021.

Significant Accounting Policies
Revenue Recognition
    We recognize revenue when we satisfy performance obligations by the transfer of control of products or services to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those products or services. Revenue is disaggregated into product sales and contract research and development to depict the nature, amount, timing of revenue recognition and economic characteristics of our business, and is represented within the financial statements.

     We recognize revenue from product sales to customers and distributors when we satisfy our performance obligation, at a point in time, upon product shipment or delivery to our customer or distributor as determined by agreed upon shipping terms. Shipping charges billed to customers are included in product sales and the related shipping costs are included in cost of sales. Under certain limited circumstances, our distributors may earn commissions for activities unrelated to their purchases of our products, such as for facilitating the sale of custom products or research and development contracts with third parties. We recognize any such commissions as selling, general, and administrative expenses. We recognize discounts provided to our distributors as reductions in revenue.

     We recognize contract research and development revenue over a period of time as the performance obligation is satisfied over a period of time rather than a point in time. Contracts have specifications unique to each customer and do not create an asset with an alternate use, and we have an enforceable right to payment for performance completed to date. We recognize revenue over a period of time using costs incurred as the measurement of progress towards completion.

     Accounts receivable is recognized when we have transferred a good or service to a customer and our right to receive consideration is unconditional through the completion of our performance obligation. A contract asset is recognized when we have a right to consideration from the transfer of goods or services to a customer but have not completed our performance obligation. A contract liability is recognized when we have been paid by a customer but have not yet satisfied the performance obligation by transferring goods or services. We had no material contract assets or contract liabilities as of September 30, 2020 or March 31, 2020.
 
     Our performance obligations related to product sales and contract research and development contracts are satisfied in one year or less. Unsatisfied performance obligations represent contracts with an original expected duration of one year or less. As permitted under Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers, we are using the practical expedient not to disclose the value of these unsatisfied performance obligations. We also use the practical expedient in which we do not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less.
 
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NOTE 3. RECENTLY ISSUED ACCOUNTING STANDARDS
New Accounting Standards Not Yet Adopted

     In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Income Taxes (Topic 740)—Simplifying the Accounting for Income Taxes. ASU 2019-12 is intended to simplify accounting for income taxes. It removes certain exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years, which is fiscal 2022 for us, with early adoption permitted. We do not expect adoption of the new guidance to have a significant impact on our financial statements.

     In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses on Financial Statements. ASU 2016-13 requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. In November 2018 the FASB issued ASU No. 2018-19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, which clarifies codification and corrects unintended application of the guidance, and in November 2019, the FASB issued ASU No. 2019-11, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, which clarifies or addresses specific issues about certain aspects of ASU 2016-13. In November 2019 the FASB issued ASU No. 2019-10, Financial Instruments—Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates, and in February 2020 the FASB issued ASU No. 2020-02, Financial Instruments—Credit Losses (Topic 326) and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842), both of which delay the effective date of ASU 2016-13 by three years for certain Smaller Reporting Companies such as us. We were unaffected by the change in the effective date of the ASU related to Leases (Topic 842) because we have already adopted that ASU. In March 2020, the FASB issued ASU No. 2020-03, Codification Improvements to Financial Instruments; which modifies the measurement of expected credit losses of certain financial instruments. In accordance with ASU 2019-10 and ASU 2020-02, ASU 2016-13 is effective for certain Smaller Reporting Companies for financial statements issued for fiscal years beginning after December 15, 2022 and interim periods within those fiscal years, which will be fiscal 2024 for us if we continue to be classified as a Smaller Reporting Company, with early adoption permitted. We do not expect adoption of the new guidance to have a significant impact on our financial statements.
 
NOTE 4. NET INCOME PER SHARE  
     Net income per basic share is computed based on the weighted-average number of common shares issued and outstanding during each period. Net income per diluted share amounts assume exercise of all stock options. The following tables show the components of diluted shares:
 
Quarter Ended Sept. 30
2020 2019
Weighted average common shares outstanding – basic 4,834,709 4,846,010
Dilutive effect of stock options 100 1,871
Shares used in computing net income per share – diluted   4,834,809 4,847,881
 
Six Months Ended Sept. 30
2020 2019
Weighted average common shares outstanding – basic 4,834,872 4,846,010
Dilutive effect of stock options 114 3,347
Shares used in computing net income per share – diluted   4,834,986 4,849,357
 
 
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NOTE 5. FAIR VALUE OF FINANCIAL INSTRUMENTS
     Our corporate bonds and money market funds are classified as available-for-sale securities and carried at estimated fair value. Unrealized holding gains and losses are included in accumulated other comprehensive income (loss) in the statement of shareholders’ equity. Corporate bonds with remaining maturities less than one year are classified as short-term, and those with remaining maturities greater than one year are classified as long-term. We consider all highly-liquid investments with maturities of three months or less when purchased, including money market funds, to be cash equivalents. Gains and losses on marketable security transactions are reported on the specific-identification method.

     Contractual maturities of available-for-sale securities as of September 30, 2020 are as follows:
 
Total <1 Year 1–3 Years 3–5 Years
$ 67,555,355   $ 26,778,033   $ 34,271,054   $ 6,506,268
 
     Total available-for-sale securities represented approximately 89% of our total assets. Marketable securities as of September 30, 2020 had remaining maturities between one and 41 months.
 
     Generally accepted accounting principles establish a framework for measuring fair value, provide a definition of fair value, and prescribe required disclosures about fair-value measurements. Generally accepted accounting principles define fair value as the price that would be received to sell an asset or paid to transfer a liability. Fair value is a market-based measurement that should be determined using assumptions that market participants would use in pricing an asset or liability. Generally accepted accounting principles utilize a valuation hierarchy for disclosure of fair value measurements. The categorization within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The categories within the valuation hierarchy are described as follows:
 
     Level 1 – Financial instruments with quoted prices in active markets for identical assets or liabilities.

     Level 2 – Financial instruments with quoted prices in active markets for similar assets or liabilities. Level 2 fair value measurements are determined using either prices for similar instruments or inputs that are either directly or indirectly observable, such as interest rates.

     Level 3 – Inputs to the fair value measurement are unobservable inputs or valuation techniques.

     Money market funds are included on the balance sheets in “Cash and cash equivalents.” Corporate bonds are included on the balance sheets in “Marketable securities, short term” and “Marketable securities, long term.”
 
     The following table shows the estimated fair value of assets that were accounted for at fair value on a recurring basis:
 
As of September 30, 2020 As of March 31, 2020
Level 1   Level 2   Total Level 1 Level 2 Total
Money market funds   $ 3,546,052    $ -    $ 3,546,052    $ 7,903,433    $ -    $ 7,903,433
Corporate bonds   -     64,009,303     64,009,303     -     62,691,309     62,691,309
Total $ 3,546,052   $ 64,009,303   $ 67,555,355   $ 7,903,433   $ 62,691,309   $ 70,594,742

     Our available-for-sale securities as of September 30 and March 31, 2020, aggregated into classes of securities, were as follows:

As of September 30, 2020 As of March 31, 2020

Amortized
Cost
  Gross
Unrealized
Holding Gains
  Gross
Unrealized
Holding Losses
  Estimated
Fair
Value

Amortized
Cost
Gross
Unrealized
Holding Gains
Gross
Unrealized
Holding Losses
Estimated
Fair
Value
Money market
   funds
$ 3,546,052    $ -    $ -      $ 3,546,052    $ 7,903,433    $ -    $ -      $ 7,903,433
Corporate bonds     61,924,230     2,085,073     -       64,009,303     62,030,120     752,621     (91,432 )     62,691,309
Total $ 65,470,282   $ 2,085,073   $ -     $ 67,555,355   $ 69,933,553   $ 752,621   $ (91,432 )   $ 70,594,742
 
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NOTE 6. INVENTORIES
     Inventories are shown in the following table:
Sept. 30,
2020
March 31,
2020
Raw materials $ 953,050 $ 1,017,451
Work in process   1,949,981 1,863,000
Finished goods 1,025,493 1,003,999
Total inventories $ 3,928,524 $ 3,884,450
 
NOTE 7. STOCK-BASED COMPENSATION
     Stock-based compensation expense was $34,315 for the second quarter of fiscal 2021, $37,022 for the first six months of fiscal 2021, and $48,360 for the second quarter and first six months of fiscal 2020. We calculate the share-based compensation expense using the Black-Scholes standard option-pricing model.
 
NOTE 8. INCOME TAXES
     Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.
 
     We had no unrecognized tax benefits as of September 30, 2020, and we do not expect any significant unrecognized tax benefits within 12 months of the reporting date. We recognize interest and penalties related to income tax matters in income tax expense. As of September 30, 2020 we had no accrued interest related to uncertain tax positions. The tax years 2016 through 2019 remain open to examination by the major taxing jurisdictions to which we are subject.
 
NOTE 9. LEASES
     We conduct our operations in a leased facility under a non-cancellable lease expiring March 31, 2026. Our lease does not provide an implicit rate, so we used our incremental borrowing rate to determine the present value of lease payments. Lease expense is recognized on a straight-line basis over the lease term. Variable lease costs consist primarily of common area maintenance and real estate taxes which are paid based on actual costs incurred by the lessor. Details of our operating lease are as follows:
 
Quarter Ended
Sept. 30, 2020
Six Months Ended
Sept. 30, 2020
Operating lease cost $ 38,641   $ 77,282
Variable lease cost   30,608     61,216  
Total $ 69,249   $ 138,498  
 
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows for leases
$ 44,433   $ 88,866
Remaining lease term   66 months
Discount rate   3.5 %
 
     The following table presents the maturities of lease liabilities as of September 30, 2020:
 
Year Ending March 31 Operating Leases
2021 $ 39,671
2022 152,703
2023 156,121
2024 159,592
2025 163,224
2026 165,947
Total lease payments   837,258  
Imputed lease interest   (78,605 )
Total lease liabilities $ 758,653  
 
 
12

Table of Contents

NOTE 10. STOCK REPURCHASE PROGRAM
     On January 21, 2009 we announced that our Board of Directors authorized the repurchase of up to $2,500,000 of our Common Stock from time to time in open market, block, or privately negotiated transactions. The timing and extent of any repurchases depends on market conditions, the trading price of the company’s stock, and other factors, and subject to the restrictions relating to volume, price, and timing under applicable law. On August 27, 2015, we announced that our Board of Directors authorized up to $5,000,000 of additional repurchases. Our repurchase program does not have an expiration date and does not obligate us to purchase any shares. The Program may be modified or discontinued at any time without notice. We intend to finance any stock repurchases with cash provided by operating activities or maturating marketable securities. The remaining authorization was $3,762,040 as of September 30, 2020. Common Stock repurchases during the second quarter of fiscal 2021, all of which were made as part of our publicly announced program, were as follows:
 
  Total number of Max. approximate
Period Total Average shares purchased dollar value of
number price as part of publicly shares that may
of shares paid announced yet be purchased
purchased per share program  under the program 
July 1, 2020 – July 31, 2020 -   $ -   -   $ 3,853,459
August 1, 2020 – August 31, 2020 -   $ -   -   $ 3,853,459
September 1, 2020 – September 30, 2020   1,806   $ 50.62   1,806   $ 3,762,040
1,806   1,806
 
NOTE 11. INFORMATION AS TO EMPLOYEE STOCK PURCHASE, SAVINGS, AND SIMILAR PLANS
     All of our employees are eligible to participate in our 401(k) savings plan the first quarter after reaching age 21. Employees may contribute up to the Internal Revenue Code maximum. We make matching contributions of 100% of the first 3% of participants’ salary deferral contributions. Our matching contributions were $21,275 for the second quarter of fiscal 2021, $21,990 for the second quarter of fiscal 2020, $46,656 for the first six months of fiscal 2021, and $46,056 for the first six months of fiscal 2020.

NOTE 12. SUBSEQUENT EVENTS
     On October 21, 2020 we announced that our Board had declared a quarterly cash dividend of $1.00 per share of Common Stock to be paid November 30, 2020 to shareholders of record as of the close of business November 2, 2020.
 
13

Table of Contents

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
 
Forward-looking statements

     Some of the statements made in this Report or in the documents incorporated by reference in this Report and in other materials filed or to be filed by us with the Securities and Exchange Commission (“SEC”) as well as information included in verbal or written statements made by us constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to the safe harbor provisions of the reform act. Forward-looking statements may be identified by the use of the terminology such as may, will, expect, anticipate, intend, believe, estimate, should, or continue, or the negatives of these terms or other variations on these words or comparable terminology. To the extent that this Report contains forward-looking statements regarding the financial condition, operating results, business prospects or any other aspect of NVE, you should be aware that our actual financial condition, operating results and business performance may differ materially from that projected or estimated by us in the forward-looking statements. We have attempted to identify, in context, some of the factors that we currently believe may cause actual future experience and results to differ from their current expectations. These differences may be caused by a variety of factors, including but not limited to risks related to our reliance on several large customers for a significant percentage of revenue, uncertainties related to the economic environments in the industries we serve, uncertainties related to future sales and revenues, risks related to the COVID-19 pandemic, risks and uncertainties related to future stock repurchases and dividend payments, and other specific risks that may be alluded to in this Report or in the documents incorporated by reference in this Report.

     Further information regarding our risks and uncertainties are contained in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended March 31, 2020 as updated in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2020 and Item 1A herein.
 
General
     NVE Corporation, referred to as NVE, we, us, or our, develops and sells devices that use spintronics, a nanotechnology that relies on electron spin rather than electron charge to acquire, store and transmit information. We manufacture high-performance spintronic products including sensors and couplers that are used to acquire and transmit data.
 
Critical accounting policies
     A description of our critical accounting policies is provided in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended March 31, 2020. As of September 30, 2020 our critical accounting policies and estimates continued to include investment valuation, inventory valuation, and deferred tax assets estimation.
 
14

Table of Contents

Quarter ended September 30, 2020 compared to quarter ended September 30, 2019
     The table shown below summarizes the percentage of revenue and quarter-to-quarter changes for various items:

Percentage of Revenue
Quarter Ended September 30
Quarter-
to-Quarter
Change
2020 2019
Revenue
Product sales
94.9 % 95.2 % (32.8 )%
Contract research and development
5.1 % 4.8 % (29.5 )%
Total revenue 100.0 % 100.0 % (32.6 )%
Cost of sales 21.5 % 20.7 % (30.1 )%
Gross profit 78.5 % 79.3 % (33.3 )%
Expenses
Research and development
18.6 % 14.2 % (11.9 )%
Selling, general, and administrative
8.2 % 5.7 % (2.8 )%
Total expenses 26.8 % 19.9 % (9.3 )%
Income from operations 51.7 % 59.4 % (41.3 )%
Interest income 9.2 % 7.0 % (12.0 )%
Income before taxes 60.9 % 66.4 % (38.2 )%
Provision for income taxes 10.2 % 7.6 % (10.2 )%
Net income 50.7 % 58.8 % (41.9 )%
 
     Total revenue for the quarter ended September 30, 2020 (the second quarter of fiscal 2021) decreased 33% compared to the quarter ended September 30, 2019 (the second quarter of fiscal 2020). The decrease was due to a 33% decrease in product sales and a 29% decrease in contract research and development revenue.

     The decrease in product sales from the prior-year quarter was primarily due to decreased purchases by existing customers. The decrease in contract research and development revenue the second quarter of fiscal 2021 was due to the completion of certain contracts.

     Total expenses decreased 9% in the second quarter of fiscal 2021 compared to the second quarter of fiscal 2020 due to a 12% decrease in research and development expense and a 3% decrease in selling, general, and administrative expense. The decrease in research and development expense was primarily due to the completion of certain product development activities.
 
     Interest income for the second quarter of fiscal 2021 decreased 12% due to a decrease in our marketable securities and money market funds and a decrease in the average interest rates on those securities and funds.

     The 42% decrease in net income in the second quarter of fiscal 2021 compared to the prior-year quarter was primarily due to a decrease in revenue.
 
15

Table of Contents

Six months ended September 30, 2020 compared to six months ended September 30, 2019
     The table shown below summarizes the percentage of revenue and period-to-period changes for various items:

Percentage of Revenue
Six Months Ended Sept. 30
Period-
to-Period
Change
2020 2019
Revenue
Product sales
95.0 % 95.9 % (30.6 )%
Contract research and development
5.0 % 4.1 % (13.6 )%
Total revenue 100.0 % 100.0 % (29.9 )%
Cost of sales 19.8 % 19.1 % (27.1 )%
Gross profit 80.2 % 80.9 % (30.6 )%
Expenses
Research and development
18.9 % 14.8 % (10.7 )%
Selling, general, and administrative
8.0 % 5.5 % 2.1 %
Total expenses 26.9 % 20.3 % (7.2 )%
Income from operations 53.3 % 60.6 % (38.4 )%
Interest income 8.9 % 7.2 % (12.5 )%
Income before taxes 62.2 % 67.8 % (35.7 )%
Provision for income taxes 10.5 % 9.7 % (23.9 )%
Net income 51.7 % 58.1 % (37.6 )%
 
     Total revenue for the six months ended September 30, 2020 decreased 30% compared to the six months ended September 30, 2019, due to a 31% decrease in product sales and a 14% decrease in contract research and development revenue.

     The decrease in product sales from the prior-year period was due to decreased purchase volumes by existing customers. The decrease in contract research and development revenue was due to the completion of certain contracts.

     Total expenses decreased 7% for the first six months of fiscal 2021 compared to the first six months of fiscal 2020 due to an 11% decrease in research and development expense, partially offset by a 2% increase in selling, general, and administrative expense. The decrease in research and development expense was due to the completion of certain product development activities.

     Interest income for the first six months of fiscal 2021 decreased 13% due to a decrease in our marketable securities and money market funds and a decrease in the average interest rates on those securities and funds.

      The 38% decrease in net income in the first six months of fiscal 2021 compared to the prior-year period was primarily due to a decrease in revenue.
 
The Impact of the COVID-19 Pandemic
     We believe the COVID-19 pandemic had a significant impact on total revenue and net income for the quarter and six months ended September 30, 2020 compared to the prior-year period due to its effects on market conditions in certain industries, especially medical devices. Total revenue and net income will likely continue to decrease for the quarter ending December 31, 2020 compared to the prior-year quarter.
 
16

Table of Contents

Liquidity and Capital Resources
Overview
     Cash and cash equivalents were $3,845,070 as of September 30, 2020 compared to $8,065,594 as of March 31, 2020. The $4,220,524 decrease in cash and cash equivalents was due to $9,761,495 of cash used in financing activities consisting of cash dividends and Common Stock repurchases, partially offset by $5,540,971 in net cash provided by operating activities.

Investing Activities
     We had no maturities or purchases of debt securities and no capital expenditures during the six months ended September 30, 2020. Capital expenditures can vary from period to period depending on our needs and equipment purchasing opportunities.
 
Financing Activities
     We paid $9,670,076 in cash dividends and repurchased $91,419 of our Common Stock in the first six months of fiscal 2021. In addition to cash dividends paid in the first six months of fiscal 2021, on October 21, 2020 we announced that our Board had declared a cash dividend of $1.00 per share of Common Stock, or $4,833,232 based on shares outstanding as of October 16, 2020, to be paid November 30, 2020. We plan to fund dividends through cash provided by operating activities and proceeds from maturities of marketable securities. All future dividends will be subject to Board approval and subject to the company’s results of operations, cash and marketable security balances, estimates of future cash requirements, the impacts of the COVID-19 pandemic, and other factors the Board may deem relevant. Furthermore, dividends may be modified or discontinued at any time without notice.

     We currently believe our working capital and cash generated from operations will be adequate for our needs at least for the next 12 months.
 
Off-Balance-Sheet Arrangements
     Our off-balance sheet arrangements consist of purchase commitments. We believe such arrangements have no material current or anticipated future effect on our profitability, cash flows, or financial position.
 
17

Table of Contents

Item 4. Controls and Procedures.
Disclosure Controls and Procedures

     Management, with the participation of the Chief Executive Officer and Chief Financial Officer, has performed an evaluation of our disclosure controls and procedures that are defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”) as of the end of the period covered by this Report. This evaluation included consideration of the controls, processes, and procedures that are designed to ensure that information required to be disclosed by us in the reports we file under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as September 30, 2020, our disclosure controls and procedures were effective.

Changes in Internal Controls
     During the quarter ended September 30, 2020, there was no change in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
 
 
PART II–OTHER INFORMATION

Item 1. Legal Proceedings.
     In the ordinary course of business we may become involved in litigation. At this time we are not aware of any material pending or threatened legal proceedings or other proceedings contemplated by governmental authorities that we expect would have a material adverse impact on our future results of operation and financial condition.

Item 1A. Risk Factors.
     There have been no material changes from the risk factors disclosed in our Annual Report on Form 10-K for the fiscal year ended March 31, 2020 as updated in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2020, except the following risk factor is replaced in its entirety by the following to update the effects of the COVID-19 pandemic on one of our packaging vendors:

The loss of supply from any of our packaging vendors could impact our ability to produce and deliver products and cause loss of revenue.
     We are dependent on our packaging vendors. Because of the unique materials our products use, the complexity of some of our products, unique magnetic requirements, and high isolation voltage specifications, many of our products are more challenging to package than conventional integrated circuits. Some of our products use processes or tooling unique to a particular packaging vendor, and it might be expensive, time-consuming, or impractical to convert to another vendor in the event of a supply interruption due to vendors’ business decisions, business condition, or acts of God, including floods, typhoons, earthquakes, or pandemics. One of our packaging vendors was forced to suspend its factory operations from late March 2020 until mid-May 2020 and was permitted only limited operation from mid-May through August 2020 pursuant to COVID-19 government orders. The vendor also cited personnel shortages related to the COVID-19 pandemic, and the pandemic has caused shortages of raw materials and subassemblies our packaging vendors need for the packaging process. Additionally, certain of our packaging vendors are in flood-susceptible areas. Flooding risks to such vendors may increase in the future due to possible higher ocean levels, extreme weather, and other potential effects of climate change. We have alternate vendors or potential alternate vendors for the majority of our products, but it can be expensive, time-consuming, and technically challenging to convert to alternate vendors. Furthermore, we may not be able to recover work in process or finished goods at a packaging vendor in the event of a disruption. Any supply interruptions or loss of inventory could seriously jeopardize our ability to provide products that are critical to our business and operations and may cause us to lose revenue.

Item 4. Mine Safety Disclosures.
     Not applicable.
 
18

Table of Contents

Item 6. Exhibits.
Exhibit #
Description
  31.1 Certification by Daniel A. Baker pursuant to Rule 13a-14(a)/15d-14(a).
 
  31.2 Certification by Curt A. Reynders pursuant to Rule 13a-14(a)/15d-14(a).
 
  32 Certification by Daniel A. Baker and Curt A. Reynders pursuant to 18 U.S.C. Section 1350.
 
101.INS XBRL Instance Document
 
101.SCH      XBRL Taxonomy Extension Schema Document
 
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document
 
101.DEF XBRL Taxonomy Extension Definition Linkbase Document
 
101.LAB XBRL Taxonomy Extension Label Linkbase Document
 
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document
 
 
19

Table of Contents
 
SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

NVE CORPORATION
          (Registrant)

 
October 21, 2020
/s/ DANIEL A. BAKER 
Date
Daniel A. Baker
President and Chief Executive Officer

 
October 21, 2020
/s/ CURT A. REYNDERS 
Date
Curt A. Reynders
Chief Financial Officer
 
 
 
20

Exhibit 31.1

CERTIFICATION

I, Daniel A. Baker, certify that:

1.                                        I have reviewed this Quarterly Report on Form 10-Q of NVE Corporation;

 

2.                                        Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.                                        Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.                                        The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)                                  Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)                                  Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; 

(c)                                  Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)                                  Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.                                        The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)                                  All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b)                                 Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 21, 2020

 
/s/ DANIEL A. BAKER
Daniel A. Baker
President and Chief Executive Officer

Exhibit 31.2

CERTIFICATION

I, Curt A. Reynders, certify that:

1.                                        I have reviewed this Quarterly Report on Form 10-Q of NVE Corporation;

 

2.                                        Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.                                        Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.                                        The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)                                  Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)                                  Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; 

(c)                                  Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)                                  Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.                                        The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)                                  All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b)                                 Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 21, 2020

 

 

/s/ CURT A. REYNDERS
Curt A. Reynders
Chief Financial Officer

Exhibit 32

 

CERTIFICATION PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002 (18 U.S.C. SECTION 1350)

 

The undersigned certify pursuant to 18 U.S.C. Section 1350, that to the undersigned’s knowledge:

 

1.                                       The accompanying Quarterly Report of NVE Corporation (the “Company”) on Form 10-Q for the quarter ended September 30, 2020, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

2.                                       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

Date: October 21, 2020

 

 

/s/ DANIEL A. BAKER

 

Daniel A. Baker

President and Chief Executive Officer

 

 

/s/ CURT A. REYNDERS

 

Curt A. Reynders

Chief Financial Officer

 

 

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

v3.20.2
Document And Entity Information - shares
6 Months Ended
Sep. 30, 2020
Oct. 16, 2020
Document Information [Line Items]    
Entity Registrant Name NVE CORP /NEW/  
Entity Central Index Key 0000724910  
Trading Symbol nvec  
Current Fiscal Year End Date --03-31  
Entity Filer Category Non-accelerated Filer  
Entity Current Reporting Status Yes  
Entity Emerging Growth Company false  
Entity Small Business true  
Entity Interactive Data Current Yes  
Entity Common Stock, Shares Outstanding (in shares)   4,833,232
Entity Shell Company false  
Document Type 10-Q  
Document Period End Date Sep. 30, 2020  
Document Fiscal Year Focus 2021  
Document Fiscal Period Focus Q2  
Amendment Flag false  
Title of 12(b) Security Common stock, $0.01 par value  
v3.20.2
Balance Sheets (Current Period Unaudited) - USD ($)
Sep. 30, 2020
Mar. 31, 2020
Current assets    
Cash and cash equivalents $ 3,845,070 $ 8,065,594 [1]
Marketable securities, short-term 23,231,981 19,084,814 [1]
Accounts receivable, net of allowance for uncollectible accounts of $15,000 1,922,076 2,694,018 [1]
Inventories 3,928,524 3,884,450 [1]
Prepaid expenses and other assets 610,635 655,835 [1]
Total current assets 33,538,286 34,384,711 [1]
Fixed assets    
Machinery and equipment 9,280,062 9,280,062 [1]
Leasehold improvements 1,797,245 1,797,245 [1]
Property, Plant and Equipment, Gross, Ending Balance 11,077,307 11,077,307 [1]
Less accumulated depreciation and amortization 10,648,191 10,494,840 [1]
Net fixed assets 429,116 582,467 [1]
Deferred tax assets 108,119 [1]
Marketable securities, long-term 40,777,322 43,606,495 [1]
Right-of-use asset – operating lease 752,861 816,358 [1]
Total assets 75,497,585 79,498,150 [1]
Current liabilities    
Accounts payable 154,566 186,993 [1]
Accrued payroll and other 424,957 482,074 [1]
Operating lease 113,666 127,134 [1]
Total current liabilities 693,189 796,201 [1]
Deferred tax liabilities 141,990 [1]
Operating lease 644,987 706,600 [1]
Total liabilities [1] 1,480,166 1,502,801
Shareholders’ equity    
Common stock, $0.01 par value, 6,000,000 shares authorized; 4,833,232 issued and outstanding as of September 30, 2020 and 4,835,038 as of March 31, 2020 48,332 48,350 [1]
Additional paid-in capital 19,329,577 19,383,956 [1]
Accumulated other comprehensive income 1,628,861 516,523 [1]
Retained earnings 53,010,649 58,046,520 [1]
Total shareholders’ equity 74,017,419 77,995,349 [1]
Total liabilities and shareholders’ equity $ 75,497,585 $ 79,498,150 [1]
[1] The March 31, 2020 Balance Sheet is derived from the audited financial statements contained in our Annual Report on Form 10-K for the fiscal year ended March 31, 2020.
v3.20.2
Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($)
Sep. 30, 2020
Mar. 31, 2020
[1]
Allowance for uncollectible accounts $ 15,000 $ 15,000
Common stock, par value (in dollars per share) $ 0.01 $ 0.01
Common stock, shares authorized (in shares) 6,000,000 6,000,000
Common stock, shares issued (in shares) 4,833,232 4,835,038
Common stock, shares outstanding (in shares) 4,833,232 4,835,038
[1] The March 31, 2020 Balance Sheet is derived from the audited financial statements contained in our Annual Report on Form 10-K for the fiscal year ended March 31, 2020.
v3.20.2
Statements of Income (Unaudited) - USD ($)
3 Months Ended 6 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Revenue        
Revenue $ 4,380,785 $ 6,501,945 $ 8,970,047 $ 12,796,641
Cost of sales 941,287 1,346,098 1,777,709 2,438,135
Gross profit 3,439,498 5,155,847 7,192,338 10,358,506
Expenses        
Research and development 815,965 926,596 1,696,948 1,899,663
Selling, general, and administrative 358,182 368,450 713,193 698,459
Total expenses 1,174,147 1,295,046 2,410,141 2,598,122
Income from operations 2,265,351 3,860,801 4,782,197 7,760,384
Interest income 401,392 456,309 800,604 915,348
Income before taxes 2,666,743 4,317,110 5,582,801 8,675,732
Provision for income taxes 444,403 495,048 948,596 1,246,251
Net income $ 2,222,340 $ 3,822,062 $ 4,634,205 $ 7,429,481
Net income per share – basic (in dollars per share) $ 0.46 $ 0.79 $ 0.96 $ 1.53
Net income per share – diluted (in dollars per share) 0.46 0.79 0.96 1.53
Cash dividends declared per common share (in dollars per share) $ 1 $ 1 $ 2 $ 2
Weighted average shares outstanding        
Basic (in shares) 4,834,709 4,846,010 4,834,872 4,846,010
Diluted (in shares) 4,834,809 4,847,881 4,834,986 4,849,357
Product [Member]        
Revenue        
Revenue $ 4,159,173 $ 6,187,708 $ 8,517,808 $ 12,273,072
Contract Research and Development [Member]        
Revenue        
Revenue $ 221,612 $ 314,237 $ 452,239 $ 523,569
v3.20.2
Statements of Comprehensive Income (Unaudited) - USD ($)
3 Months Ended 6 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Net income $ 2,222,340 $ 3,822,062 $ 4,634,205 $ 7,429,481
Unrealized (loss) gain from marketable securities, net of tax (130,324) 178,716 1,112,338 748,779
Comprehensive income $ 2,092,016 $ 4,000,778 $ 5,746,543 $ 8,178,260
v3.20.2
Statements of Shareholders' Equity (Unaudited) - USD ($)
Cumulative Effect, Period of Adoption, Adjustment [Member]
Common Stock [Member]
Common Stock [Member]
Additional Paid-in Capital [Member]
AOCI Attributable to Parent [Member]
Retained Earnings [Member]
Total
Unrealized (loss) gain from marketable securities, net of tax   $ 570,063 $ 570,063
Net income         3,607,419 3,607,419
Total comprehensive income           4,177,482
Cash dividends declared ($1.00 per share of common stock)         (4,846,010) (4,846,010)
Balance (in shares) at Mar. 31, 2019   4,846,010        
Balance at Mar. 31, 2019   $ 48,460 19,910,558 (82,725) 62,903,918 82,780,211
Balance (in shares) at Jun. 30, 2019   4,846,010        
Balance at Jun. 30, 2019   $ 48,460 19,910,558 487,338 61,665,327 82,111,683
Unrealized (loss) gain from marketable securities, net of tax           748,779
Net income           7,429,481
Balance (in shares) at Mar. 31, 2019   4,846,010        
Balance at Mar. 31, 2019   $ 48,460 19,910,558 (82,725) 62,903,918 82,780,211
Balance (in shares) at Sep. 30, 2019   4,846,010        
Balance at Sep. 30, 2019   $ 48,460 19,958,918 666,054 60,641,379 81,314,811
Unrealized (loss) gain from marketable securities, net of tax   178,716 178,716
Net income         3,822,062 3,822,062
Total comprehensive income           4,000,778
Stock-based compensation   48,360 48,360
Cash dividends declared ($1.00 per share of common stock)         (4,846,010) (4,846,010)
Balance (in shares) at Jun. 30, 2019   4,846,010        
Balance at Jun. 30, 2019   $ 48,460 19,910,558 487,338 61,665,327 82,111,683
Balance (in shares) at Sep. 30, 2019   4,846,010        
Balance at Sep. 30, 2019   $ 48,460 19,958,918 666,054 60,641,379 81,314,811
Unrealized (loss) gain from marketable securities, net of tax   1,242,662 1,242,662
Net income         2,411,865 2,411,865
Total comprehensive income           3,654,527
Stock-based compensation   2,707 2,707
Cash dividends declared ($1.00 per share of common stock)         (4,835,038) (4,835,038)
Balance at Mar. 31, 2020 [1]           77,995,349
Balance (in shares) at Jun. 30, 2020   4,835,038        
Balance at Jun. 30, 2020   $ 48,350 19,386,663 1,759,185 55,623,347 76,817,545
Unrealized (loss) gain from marketable securities, net of tax           1,112,338
Net income           4,634,205
Balance at Mar. 31, 2020 [1]           77,995,349
Balance (in shares) at Sep. 30, 2020 4,833,232          
Balance at Sep. 30, 2020   48,332 19,329,577 1,628,861 53,010,649 74,017,419
Unrealized (loss) gain from marketable securities, net of tax   (130,324) (130,324)
Net income   2,222,340 2,222,340
Total comprehensive income   2,092,016
Stock-based compensation   34,315 34,315
Cash dividends declared ($1.00 per share of common stock)   (4,835,038) (4,835,038)
Balance (in shares) at Jun. 30, 2020   4,835,038        
Balance at Jun. 30, 2020   $ 48,350 19,386,663 1,759,185 55,623,347 76,817,545
Repurchase of common stock (in shares)   (1,806)        
Repurchase of common stock   $ (18) (91,401) (91,419)
Balance (in shares) at Sep. 30, 2020 4,833,232          
Balance at Sep. 30, 2020   $ 48,332 $ 19,329,577 $ 1,628,861 $ 53,010,649 $ 74,017,419
[1] The March 31, 2020 Balance Sheet is derived from the audited financial statements contained in our Annual Report on Form 10-K for the fiscal year ended March 31, 2020.
v3.20.2
Statements of Shareholders' Equity (Unaudited) (Parentheticals) - $ / shares
3 Months Ended
Sep. 30, 2020
Jun. 30, 2020
Sep. 30, 2019
Jun. 30, 2019
Additional Paid-in Capital [Member]        
Common Stock per share (in dollars per share)     $ 1 $ 1
Common Stock per share (in dollars per share) $ 1 $ 1    
v3.20.2
Statements of Cash Flows (Unaudited) - USD ($)
6 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Net income $ 4,634,205 $ 7,429,481
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization 259,241 266,916
Stock-based compensation 37,022 48,360
Deferred income taxes (61,437) 75,521
Changes in operating assets and liabilities:    
Accounts receivable 771,942 (220,147)
Inventories (44,074) (90,456)
Prepaid expenses and other assets 108,697 41,687
Accounts payable and other liabilities (164,625) (130,726)
Net cash provided by operating activities 5,540,971 7,420,636
INVESTING ACTIVITIES    
Purchases of fixed assets (16,100)
Purchases of marketable securities (3,013,530)
Proceeds from maturities of marketable securities 12,500,000
Cash provided by investing activities 9,470,370
FINANCING ACTIVITIES    
Repurchase of common stock (91,419)
Payment of dividends to shareholders (9,670,076) (9,692,020)
Cash used in financing activities (9,761,495) (9,692,020)
(Decrease) increase in cash and cash equivalents (4,220,524) 7,198,986
Cash and cash equivalents at beginning of period 8,065,594 6,877,304
Cash and cash equivalents at end of period 3,845,070 14,076,290
Supplemental disclosures of cash flow information:    
Cash paid during the period for income taxes $ 934,788 $ 1,230,000
v3.20.2
Note 1 - Description of Business
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Business Description and Basis of Presentation [Text Block]

NOTE
1.
DESCRIPTION OF BUSINESS

     We develop and sell devices that use spintronics, a nanotechnology that relies on electron spin rather than electron charge to acquire, store, and transmit information.
v3.20.2
Note 2 - Basis of Presentation and Significant Accounting Policies
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Basis of Presentation and Significant Accounting Policies [Text Block]

NOTE
2.
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

     The accompanying unaudited financial statements of NVE Corporation are prepared consistent with accounting principles generally accepted in the United States and in accordance with Securities and Exchange Commission rules and regulations. In the opinion of management, these financial statements reflect all adjustments, consisting only of normal and recurring adjustments, necessary for a fair presentation of the financial statements. Although we believe that the disclosures are adequate to make the information presented
not
misleading, certain disclosures have been omitted as allowed, and it is suggested that these unaudited financial statements be read in conjunction with the audited financial statements and the notes included in our latest annual financial statements included in our Annual Report on Form
10
-K for the fiscal year ended
March 
31,
2020.
The results of operations for the quarter and
six
months ended
September 
30,
2020
are
not
necessarily indicative of the results that
may
be expected for the full fiscal year ending
March 
31,
2021.


Significant Accounting Policies

Revenue Recognition

    We recognize revenue when we satisfy performance obligations by the transfer of control of products or services to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those products or services. Revenue is disaggregated into product sales and contract research and development to depict the nature, amount, timing of revenue recognition and economic characteristics of our business, and is represented within the financial statements.

     We recognize revenue from product sales to customers and distributors when we satisfy our performance obligation, at a point in time, upon product shipment or delivery to our customer or distributor as determined by agreed upon shipping terms. Shipping charges billed to customers are included in product sales and the related shipping costs are included in cost of sales. Under certain limited circumstances, our distributors
may
earn commissions for activities unrelated to their purchases of our products, such as for facilitating the sale of custom products or research and development contracts with
third
parties. We recognize any such commissions as selling, general, and administrative expenses. We recognize discounts provided to our distributors as reductions in revenue.

     We recognize contract research and development revenue over a period of time as the performance obligation is satisfied over a period of time rather than a point in time. Contracts have specifications unique to each customer and do
not
create an asset with an alternate use, and we have an enforceable right to payment for performance completed to date. We recognize revenue over a period of time using costs incurred as the measurement of progress towards completion.

     Accounts receivable is recognized when we have transferred a good or service to a customer and our right to receive consideration is unconditional through the completion of our performance obligation. A contract asset is recognized when we have a right to consideration from the transfer of goods or services to a customer but have
not
completed our performance obligation. A contract liability is recognized when we have been paid by a customer but have
not
yet satisfied the performance obligation by transferring goods or services. We had
no
material contract assets or contract liabilities as of
September 
30,
2020
or
March 
31,
2020.

 
     Our performance obligations related to product sales and contract research and development contracts are satisfied in
one
year or less. Unsatisfied performance obligations represent contracts with an original expected duration of
one
year or less. As permitted under Accounting Standards Codification (“ASC”) Topic 
606,
Revenue from Contracts with Customers
, we are using the practical expedient
not
to disclose the value of these unsatisfied performance obligations. We also use the practical expedient in which we do
not
assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be
one
year or less.
 
v3.20.2
Note 3 - Recently Issued Accounting Standards
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Accounting Standards Update and Change in Accounting Principle [Text Block]

NOTE
3.
RECENTLY ISSUED ACCOUNTING STANDARDS

New Accounting Standards
Not
Yet Adopted

     In
December 2019,
the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)
No.
2019
-
12,
Income Taxes (Topic
740
)—Simplifying the Accounting for Income Taxes
. ASU 
2019
-
12
is intended to simplify accounting for income taxes. It removes certain exceptions to the general principles in Topic
740
and amends existing guidance to improve consistent application. ASU
2019
-
12
is effective for fiscal years beginning after
December 15, 2020
and interim periods within those fiscal years, which is fiscal
2022
for us, with early adoption permitted. We do
not
expect adoption of the new guidance to have a significant impact on our financial statements.

     In
June 2016,
the FASB issued ASU
No.
 
2016
-
13,
Financial Instruments—Credit Losses (Topic
326
), Measurement of Credit Losses on Financial Statements
. ASU 
2016
-
13
requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. In
November 
2018
the FASB issued ASU
No.
 
2018
-
19,
Codification Improvements to Topic 
326,
Financial Instruments—Credit Losses
, which clarifies codification and corrects unintended application of the guidance, and in
November 2019,
the FASB issued ASU
No.
 
2019
-
11,
Codification Improvements to Topic
326,
Financial Instruments-Credit Losses
, which clarifies or addresses specific issues about certain aspects of ASU 
2016
-
13.
In
November 
2019
the FASB issued ASU
No.
 
2019
-
10,
Financial Instruments—Credit Losses (Topic 
326
), Derivatives and Hedging (Topic
815
), and Leases (Topic 
842
): Effective Dates
, and in
February 2020
the FASB issued ASU
No.
 
2020
-
02,
Financial Instruments—Credit Losses (Topic 
326
) and Leases (Topic
842
): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin
No.
 
119
and Update to SEC Section on Effective Date Related to Accounting Standards Update
No.
 
2016
-
02,
Leases (Topic 
842
)
, both of which delay the effective date of ASU 
2016
-
13
by
three
years for certain Smaller Reporting Companies such as us. We were unaffected by the change in the effective date of the ASU related to Leases (Topic 
842
) because we have already adopted that ASU. In
March 
2020,
the FASB issued ASU
No.
 
2020
-
03,
Codification Improvements to Financial Instruments
; which modifies the measurement of expected credit losses of certain financial instruments. In accordance with ASU 
2019
-
10
and ASU 
2020
-
02,
ASU 
2016
-
13
is effective for certain Smaller Reporting Companies for financial statements issued for fiscal years beginning after
December 
15,
2022
and interim periods within those fiscal years, which will be fiscal
2024
for us if we continue to be classified as a Smaller Reporting Company, with early adoption permitted. We do
not
expect adoption of the new guidance to have a significant impact on our financial statements.
 
v3.20.2
Note 4 - Net Income Per Share
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Earnings Per Share [Text Block]

NOTE
4.
NET INCOME PER SHARE
 
     Net income per basic share is computed based on the weighted-average number of common shares issued and outstanding during each period. Net income per diluted share amounts assume exercise of all stock options. The following tables show the components of diluted shares:
 
   
Quarter Ended Sept. 30
 
   
2020
   
2019
 
Weighted average common shares outstanding – basic
   
4,834,709
     
4,846,010
 
Dilutive effect of stock options
   
100
     
1,871
 
Shares used in computing net income per share – diluted
   
4,834,809
     
4,847,881
 
 
   
Six Months Ended Sept. 30
 
   
2020
   
2019
 
Weighted average common shares outstanding – basic
   
4,834,872
     
4,846,010
 
Dilutive effect of stock options
   
114
     
3,347
 
Shares used in computing net income per share – diluted
   
4,834,986
     
4,849,357
 
v3.20.2
Note 5 - Fair Value of Financial Instruments
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Fair Value Disclosures [Text Block]

NOTE
5.
FAIR VALUE OF FINANCIAL INSTRUMENTS

     Our corporate bonds and money market funds are classified as available-for-sale securities and carried at estimated fair value. Unrealized holding gains and losses are included in accumulated other comprehensive income (loss) in the statement of shareholders' equity. Corporate bonds with remaining maturities less than
one
year are classified as short-term, and those with remaining maturities greater than
one
year are classified as long-term. We consider all highly-liquid investments with maturities of
three
months or less when purchased, including money market funds, to be cash equivalents. Gains and losses on marketable security transactions are reported on the specific-identification method.

     Contractual maturities of available-for-sale securities as of
September 30, 2020
are as follows:
 
Total
   
<1 Year
   
1–3 Years
   
3–5 Years
 
$
67,555,355
    $
26,778,033
    $
34,271,054
    $
6,506,268
 
 
     Total available-for-sale securities represented approximately
89%
of our total assets. Marketable securities as of
September 
30,
2020
had remaining maturities between
one
and
41
 months.
 
     Generally accepted accounting principles establish a framework for measuring fair value, provide a definition of fair value, and prescribe required disclosures about fair-value measurements. Generally accepted accounting principles define fair value as the price that would be received to sell an asset or paid to transfer a liability. Fair value is a market-based measurement that should be determined using assumptions that market participants would use in pricing an asset or liability. Generally accepted accounting principles utilize a valuation hierarchy for disclosure of fair value measurements. The categorization within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The categories within the valuation hierarchy are described as follows:
 
     Level
1
– Financial instruments with quoted prices in active markets for identical assets or liabilities.

     Level
2
– Financial instruments with quoted prices in active markets for similar assets or liabilities. Level 
2
fair value measurements are determined using either prices for similar instruments or inputs that are either directly or indirectly observable, such as interest rates.

     Level
3
– Inputs to the fair value measurement are unobservable inputs or valuation techniques.

     Money market funds are included on the balance sheets in “Cash and cash equivalents.” Corporate bonds are included on the balance sheets in “Marketable securities, short term” and “Marketable securities, long term.”
 
     The following table shows the estimated fair value of assets that were accounted for at fair value on a recurring basis:
 
   
As of September 30, 2020
   
As of March 31, 2020
 
   
Level 1
   
Level 2
   
Total
   
Level 1
   
Level 2
   
Total
 
Money market funds
  $
3,546,052
    $
-
    $
3,546,052
    $
7,903,433
    $
-
    $
7,903,433
 
Corporate bonds
   
-
     
64,009,303
     
64,009,303
     
-
     
62,691,309
     
62,691,309
 
Total
  $
3,546,052
    $
64,009,303
    $
67,555,355
    $
7,903,433
    $
62,691,309
    $
70,594,742
 

     Our available-for-sale securities as of
September 
30
and
March 
31,
2020,
aggregated into classes of securities, were as follows:
 
   
As of September 30, 2020
   
As of March 31, 2020
 
   

Amortized
Cost
   
Gross
Unrealized
Holding Gains
   
Gross
Unrealized
Holding Losses
   
Estimated
Fair
Value
   

Amortized
Cost
   
Gross
Unrealized
Holding Gains
   
Gross
Unrealized
Holding Losses
   
Estimated
Fair
Value
 
Money market funds
  $
3,546,052
    $
-
    $
-
    $
3,546,052
    $
7,903,433
    $
-
    $
-
    $
7,903,433
 
Corporate bonds
   
61,924,230
     
2,085,073
     
-
     
64,009,303
     
62,030,120
     
752,621
     
(91,432
)
   
62,691,309
 
Total
  $
65,470,282
    $
2,085,073
    $
-
    $
67,555,355
    $
69,933,553
    $
752,621
    $
(91,432
)
  $
70,594,742
 
v3.20.2
Note 6 - Inventories
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Inventory Disclosure [Text Block]

NOTE
6.
INVENTORIES

     Inventories are shown in the following table:
   
Sept. 30,
2020
   
March 31,
2020
 
Raw materials
  $
953,050
    $
1,017,451
 
Work in process
   
1,949,981
     
1,863,000
 
Finished goods
   
1,025,493
     
1,003,999
 
Total inventories
  $
3,928,524
    $
3,884,450
 
v3.20.2
Note 7 - Stock-based Compensation
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Share-based Payment Arrangement [Text Block]

NOTE
7.
STOCK-BASED COMPENSATION

     Stock-based compensation expense was
$34,315
for the
second
quarter of fiscal
2021,
$37,022
for the
first
six
months of fiscal
2021,
and
$48,360
for the
second
quarter and
first
six
months of fiscal
2020.
We calculate the share-based compensation expense using the Black-Scholes standard option-pricing model.
 
v3.20.2
Note 8 - Income Taxes
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

NOTE
8.
INCOME TAXES

     Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.
 
     We had
no
unrecognized tax benefits as of
September 
30,
2020,
and we do
not
expect any significant unrecognized tax benefits within
12
 months of the reporting date. We recognize interest and penalties related to income tax matters in income tax expense. As of
September 
30,
2020
we had
no
accrued interest related to uncertain tax positions. The tax years
2016
through
2019
remain open to examination by the major taxing jurisdictions to which we are subject.
 
v3.20.2
Note 9 - Leases
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Lessee, Operating Leases [Text Block]

NOTE
9.
LEASES

     We conduct our operations in a leased facility under a non-cancellable lease expiring
March 31, 2026.
Our lease does
not
provide an implicit rate, so we used our incremental borrowing rate to determine the present value of lease payments. Lease expense is recognized on a straight-line basis over the lease term. Variable lease costs consist primarily of common area maintenance and real estate taxes which are paid based on actual costs incurred by the lessor. Details of our operating lease are as follows:
 
   
Quarter Ended
Sept. 30, 2020
   
Six Months Ended
Sept. 30, 2020
 
Operating lease cost
  $
38,641
    $
77,282
 
Variable lease cost
   
30,608
     
61,216
 
Total
  $
69,249
    $
138,498
 
                 
Cash paid for amounts included in the measurement of lease liabilities
 
Operating cash flows for leases
  $
44,433
    $
88,866
 
Remaining lease term (in months)
   
66
     
 
 
Discount rate
   
3.5
%
   
 
 
 
     The following table presents the maturities of lease liabilities as of
September 
30,
2020:

 
Year Ending March 31
 
Operating Leases
 
2021
  $
39,671
 
2022
   
152,703
 
2023
   
156,121
 
2024
   
159,592
 
2025
   
163,224
 
2026
   
165,947
 
Total lease payments
   
837,258
 
Imputed lease interest
   
(78,605
)
Total lease liabilities
  $
758,653
 
v3.20.2
Note 10 - Stock Repurchase Program
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Stock Repurchase Plan Disclosure [Text Block]

NOTE
10.
STOCK REPURCHASE PROGRAM

     On
January 21, 2009
we announced that our Board of Directors authorized the repurchase of up to
$2,500,000
of our Common Stock from time to time in open market, block, or privately negotiated transactions. The timing and extent of any repurchases depends on market conditions, the trading price of the company's stock, and other factors, and subject to the restrictions relating to volume, price, and timing under applicable law. On
August 
27,
2015,
we announced that our Board of Directors authorized up to
$5,000,000
of additional repurchases. Our repurchase program does
not
have an expiration date and does
not
obligate us to purchase any shares. The Program
may
be modified or discontinued at any time without notice. We intend to finance any stock repurchases with cash provided by operating activities or maturating marketable securities. The remaining authorization was
$3,762,040
as of
September 
30,
 
2020.
Common Stock repurchases during the
second
quarter of fiscal
2021,
all of which were made as part of our publicly announced program, were as follows:
 
       
 
 
 
 
 
 
 
 
Total number of
   
Max. approximate
 
   
 
 
Total
   
Average
   
shares purchased
   
dollar value of
 
   
 
 
number
   
price
   
as part of publicly
   
shares that may
 
   
 
 
of shares
   
paid
   
announced
   
yet be purchased
 
Period
 
 
 
purchased
   
per share
   
program
   
under the program
 
July 1, 2020
July 31, 2020
   
-
    $
-
     
-
    $
3,853,459
 
August 1, 2020
August 31, 2020
   
-
    $
-
     
-
    $
3,853,459
 
September 1, 2020
September 30, 2020
   
1,806
    $
50.62
     
1,806
    $
3,762,040
 
   
 
   
1,806
     
 
     
1,806
     
 
 
v3.20.2
Note 11 - Information as to Employee Stock Purchase, Savings, and Similar Plans
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Retirement Benefits [Text Block]

NOTE
11.
INFORMATION AS TO EMPLOYEE STOCK PURCHASE, SAVINGS, AND SIMILAR PLANS

     All of our employees are eligible to participate in our
401
(k) savings plan the
first
quarter after reaching age 
21.
Employees
may
contribute up to the Internal Revenue Code maximum. We make matching contributions of
100%
of the
first
3%
of participants' salary deferral contributions. Our matching contributions were
$21,275
for the
second
quarter of fiscal 
2021,
$21,990
for the
second
quarter of fiscal 
2020,
$46,656
for the
first
six
months of fiscal 
2021,
and
$46,056
for the
first
six
months of fiscal 
2020.
v3.20.2
Note 12 - Subsequent Events
6 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Subsequent Events [Text Block]

NOTE
12.
SUBSEQUENT EVENTS

     On
October 
21,
2020
we announced that our Board had declared a quarterly cash dividend of
$1.00
per share of Common Stock to be paid
November 
30,
2020
to shareholders of record as of the close of business
November 
2,
2020.

 
v3.20.2
Significant Accounting Policies (Policies)
6 Months Ended
Sep. 30, 2020
Accounting Policies [Abstract]  
Basis of Accounting, Policy [Policy Text Block]
Basis of Presentation

     The accompanying unaudited financial statements of NVE Corporation are prepared consistent with accounting principles generally accepted in the United States and in accordance with Securities and Exchange Commission rules and regulations. In the opinion of management, these financial statements reflect all adjustments, consisting only of normal and recurring adjustments, necessary for a fair presentation of the financial statements. Although we believe that the disclosures are adequate to make the information presented
not
misleading, certain disclosures have been omitted as allowed, and it is suggested that these unaudited financial statements be read in conjunction with the audited financial statements and the notes included in our latest annual financial statements included in our Annual Report on Form
10
-K for the fiscal year ended
March 
31,
2020.
The results of operations for the quarter and
six
months ended
September 
30,
2020
are
not
necessarily indicative of the results that
may
be expected for the full fiscal year ending
March 
31,
2021.
Revenue from Contract with Customer [Policy Text Block]
Revenue Recognition

    We recognize revenue when we satisfy performance obligations by the transfer of control of products or services to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those products or services. Revenue is disaggregated into product sales and contract research and development to depict the nature, amount, timing of revenue recognition and economic characteristics of our business, and is represented within the financial statements.

     We recognize revenue from product sales to customers and distributors when we satisfy our performance obligation, at a point in time, upon product shipment or delivery to our customer or distributor as determined by agreed upon shipping terms. Shipping charges billed to customers are included in product sales and the related shipping costs are included in cost of sales. Under certain limited circumstances, our distributors
may
earn commissions for activities unrelated to their purchases of our products, such as for facilitating the sale of custom products or research and development contracts with
third
parties. We recognize any such commissions as selling, general, and administrative expenses. We recognize discounts provided to our distributors as reductions in revenue.

     We recognize contract research and development revenue over a period of time as the performance obligation is satisfied over a period of time rather than a point in time. Contracts have specifications unique to each customer and do
not
create an asset with an alternate use, and we have an enforceable right to payment for performance completed to date. We recognize revenue over a period of time using costs incurred as the measurement of progress towards completion.

     Accounts receivable is recognized when we have transferred a good or service to a customer and our right to receive consideration is unconditional through the completion of our performance obligation. A contract asset is recognized when we have a right to consideration from the transfer of goods or services to a customer but have
not
completed our performance obligation. A contract liability is recognized when we have been paid by a customer but have
not
yet satisfied the performance obligation by transferring goods or services. We had
no
material contract assets or contract liabilities as of
September 
30,
2020
or
March 
31,
2020.

 
     Our performance obligations related to product sales and contract research and development contracts are satisfied in
one
year or less. Unsatisfied performance obligations represent contracts with an original expected duration of
one
year or less. As permitted under Accounting Standards Codification (“ASC”) Topic 
606,
Revenue from Contracts with Customers
, we are using the practical expedient
not
to disclose the value of these unsatisfied performance obligations. We also use the practical expedient in which we do
not
assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be
one
year or less.
v3.20.2
Note 4 - Net Income Per Share (Tables)
6 Months Ended
Sep. 30, 2020
Notes Tables  
Schedule of Weighted Average Number of Shares [Table Text Block]
   
Quarter Ended Sept. 30
 
   
2020
   
2019
 
Weighted average common shares outstanding – basic
   
4,834,709
     
4,846,010
 
Dilutive effect of stock options
   
100
     
1,871
 
Shares used in computing net income per share – diluted
   
4,834,809
     
4,847,881
 
   
Six Months Ended Sept. 30
 
   
2020
   
2019
 
Weighted average common shares outstanding – basic
   
4,834,872
     
4,846,010
 
Dilutive effect of stock options
   
114
     
3,347
 
Shares used in computing net income per share – diluted
   
4,834,986
     
4,849,357
 
v3.20.2
Note 5 - Fair Value of Financial Instruments (Tables)
6 Months Ended
Sep. 30, 2020
Notes Tables  
Investments Classified by Contractual Maturity Date [Table Text Block]
Total
   
<1 Year
   
1–3 Years
   
3–5 Years
 
$
67,555,355
    $
26,778,033
    $
34,271,054
    $
6,506,268
 
Fair Value, Assets Measured on Recurring Basis [Table Text Block]
   
As of September 30, 2020
   
As of March 31, 2020
 
   
Level 1
   
Level 2
   
Total
   
Level 1
   
Level 2
   
Total
 
Money market funds
  $
3,546,052
    $
-
    $
3,546,052
    $
7,903,433
    $
-
    $
7,903,433
 
Corporate bonds
   
-
     
64,009,303
     
64,009,303
     
-
     
62,691,309
     
62,691,309
 
Total
  $
3,546,052
    $
64,009,303
    $
67,555,355
    $
7,903,433
    $
62,691,309
    $
70,594,742
 
Schedule of Available-for-sale Securities Reconciliation [Table Text Block]
   
As of September 30, 2020
   
As of March 31, 2020
 
   

Amortized
Cost
   
Gross
Unrealized
Holding Gains
   
Gross
Unrealized
Holding Losses
   
Estimated
Fair
Value
   

Amortized
Cost
   
Gross
Unrealized
Holding Gains
   
Gross
Unrealized
Holding Losses
   
Estimated
Fair
Value
 
Money market funds
  $
3,546,052
    $
-
    $
-
    $
3,546,052
    $
7,903,433
    $
-
    $
-
    $
7,903,433
 
Corporate bonds
   
61,924,230
     
2,085,073
     
-
     
64,009,303
     
62,030,120
     
752,621
     
(91,432
)
   
62,691,309
 
Total
  $
65,470,282
    $
2,085,073
    $
-
    $
67,555,355
    $
69,933,553
    $
752,621
    $
(91,432
)
  $
70,594,742
 
v3.20.2
Note 6 - Inventories (Tables)
6 Months Ended
Sep. 30, 2020
Notes Tables  
Schedule of Inventory, Current [Table Text Block]
   
Sept. 30,
2020
   
March 31,
2020
 
Raw materials
  $
953,050
    $
1,017,451
 
Work in process
   
1,949,981
     
1,863,000
 
Finished goods
   
1,025,493
     
1,003,999
 
Total inventories
  $
3,928,524
    $
3,884,450
 
v3.20.2
Note 9 - Leases (Tables)
6 Months Ended
Sep. 30, 2020
Notes Tables  
Lease, Cost [Table Text Block]
   
Quarter Ended
Sept. 30, 2020
   
Six Months Ended
Sept. 30, 2020
 
Operating lease cost
  $
38,641
    $
77,282
 
Variable lease cost
   
30,608
     
61,216
 
Total
  $
69,249
    $
138,498
 
                 
Cash paid for amounts included in the measurement of lease liabilities
 
Operating cash flows for leases
  $
44,433
    $
88,866
 
Remaining lease term (in months)
   
66
     
 
 
Discount rate
   
3.5
%
   
 
 
Lessee, Operating Lease, Liability, Maturity [Table Text Block]
Year Ending March 31
 
Operating Leases
 
2021
  $
39,671
 
2022
   
152,703
 
2023
   
156,121
 
2024
   
159,592
 
2025
   
163,224
 
2026
   
165,947
 
Total lease payments
   
837,258
 
Imputed lease interest
   
(78,605
)
Total lease liabilities
  $
758,653
 
v3.20.2
Note 10 - Stock Repurchase Program (Tables)
6 Months Ended
Sep. 30, 2020
Notes Tables  
Schedule of Stock Repurchase Program [Table Text Block]
       
 
 
 
 
 
 
 
 
Total number of
   
Max. approximate
 
   
 
 
Total
   
Average
   
shares purchased
   
dollar value of
 
   
 
 
number
   
price
   
as part of publicly
   
shares that may
 
   
 
 
of shares
   
paid
   
announced
   
yet be purchased
 
Period
 
 
 
purchased
   
per share
   
program
   
under the program
 
July 1, 2020
July 31, 2020
   
-
    $
-
     
-
    $
3,853,459
 
August 1, 2020
August 31, 2020
   
-
    $
-
     
-
    $
3,853,459
 
September 1, 2020
September 30, 2020
   
1,806
    $
50.62
     
1,806
    $
3,762,040
 
   
 
   
1,806
     
 
     
1,806
     
 
 
v3.20.2
Note 4 - Net Income Per Share - Components of Common Shares Outstanding (Details) - shares
3 Months Ended 6 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Basic (in shares) 4,834,709 4,846,010 4,834,872 4,846,010
Dilutive effect of stock options (in shares) 100 1,871 114 3,347
Shares used in computing net income per share – diluted (in shares) 4,834,809 4,847,881 4,834,986 4,849,357
v3.20.2
Note 5 - Fair Value of Financial Instruments (Details Textual)
6 Months Ended
Sep. 30, 2020
Available for Sale Debt Securitites, Percent of Total Assets 89.00%
Minimum [Member]  
Available for Sale Debt Securities, Remaining Maturity (Month) 30 days
Maximum [Member]  
Available for Sale Debt Securities, Remaining Maturity (Month) 3 years 150 days
v3.20.2
Note 5 - Fair Value of Financial Instruments - Fair Value of Available-for-sale Securities (Details) - USD ($)
Sep. 30, 2020
Mar. 31, 2020
Total $ 67,555,355 $ 70,594,742
Less than 1 year 26,778,033  
1-3 years 34,271,054  
3-5 years $ 6,506,268  
v3.20.2
Note 5 - Fair Value of Financial Instruments - Assets Measured on Recurring Basis (Details) - USD ($)
Sep. 30, 2020
Mar. 31, 2020
Total $ 67,555,355 $ 70,594,742
Money Market Funds [Member]    
Total 3,546,052 7,903,433
Corporate Bond Securities [Member]    
Total 64,009,303 62,691,309
Fair Value, Recurring [Member]    
Total 67,555,355 70,594,742
Fair Value, Recurring [Member] | Money Market Funds [Member]    
Total 3,546,052 7,903,433
Fair Value, Recurring [Member] | Corporate Bond Securities [Member]    
Total 64,009,303 62,691,309
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]    
Total 3,546,052 7,903,433
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Money Market Funds [Member]    
Total 3,546,052 7,903,433
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Corporate Bond Securities [Member]    
Total
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]    
Total 64,009,303 62,691,309
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Money Market Funds [Member]    
Total
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Corporate Bond Securities [Member]    
Total $ 64,009,303 $ 62,691,309
v3.20.2
Note 5 - Fair Value of Financial Instruments - Reconciliation of Available-for-sale Securities (Details) - USD ($)
Sep. 30, 2020
Mar. 31, 2020
Amortized Cost $ 65,470,282 $ 69,933,553
Gross Unrealized Holding Gains 2,085,073 752,621
Gross Unrealized Holding Losses (91,432)
Estimated Fair Value 67,555,355 70,594,742
Money Market Funds [Member]    
Amortized Cost 3,546,052 7,903,433
Gross Unrealized Holding Gains
Gross Unrealized Holding Losses
Estimated Fair Value 3,546,052 7,903,433
Corporate Bond Securities [Member]    
Amortized Cost 61,924,230 62,030,120
Gross Unrealized Holding Gains 2,085,073 752,621
Gross Unrealized Holding Losses (91,432)
Estimated Fair Value $ 64,009,303 $ 62,691,309
v3.20.2
Note 6 - Inventories - Summary of Inventories (Details) - USD ($)
Sep. 30, 2020
Mar. 31, 2020
Raw materials $ 953,050 $ 1,017,451
Work in process 1,949,981 1,863,000
Finished goods 1,025,493 1,003,999
Total inventories $ 3,928,524 $ 3,884,450 [1]
[1] The March 31, 2020 Balance Sheet is derived from the audited financial statements contained in our Annual Report on Form 10-K for the fiscal year ended March 31, 2020.
v3.20.2
Note 7 - Stock-based Compensation (Details Textual) - USD ($)
3 Months Ended 6 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Share-based Payment Arrangement, Expense $ 34,315 $ 48,360 $ 37,022 $ 48,360
v3.20.2
Note 8 - Income Taxes (Details Textual)
$ in Thousands
6 Months Ended
Sep. 30, 2020
USD ($)
Unrecognized Tax Benefits, Ending Balance $ 0
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Amount of Unrecorded Benefit 0
Unrecognized Tax Benefits, Interest on Income Taxes Accrued $ 0
Open Tax Year 2016 2017 2018 2019
v3.20.2
Note 9 - Leases - Operating Lease (Details)
3 Months Ended 6 Months Ended
Sep. 30, 2020
USD ($)
Sep. 30, 2020
USD ($)
Operating lease cost $ 38,641 $ 77,282
Variable lease cost 30,608 61,216
Total 69,249 138,498
Operating cash flows for leases $ 44,433 $ 88,866
Remaining lease term (Month) 5 years 180 days 5 years 180 days
Discount rate 3.50% 3.50%
v3.20.2
Note 9 - Leases - Maturities of Lease Liabilities (Details)
Sep. 30, 2020
USD ($)
2021 $ 39,671
2022 152,703
2023 156,121
2024 159,592
2025 163,224
2026 165,947
Total lease payments 837,258
Imputed lease interest (78,605)
Total lease liabilities $ 758,653
v3.20.2
Note 10 - Stock Repurchase Program (Details Textual) - Repurchase Program 2009 [Member] - USD ($)
Sep. 30, 2020
Aug. 27, 2015
Jan. 21, 2009
Stock Repurchase Program, Authorized Amount     $ 2,500,000
Stock Repurchase Program Authorized Additional Amount   $ 5,000,000  
Stock Repurchase Program, Remaining Authorized Repurchase Amount $ 3,762,040    
v3.20.2
Note 10 - Stock Repurchase Program - Schedule of Stock Repurchase Program (Details) - Common Stock [Member] - USD ($)
1 Months Ended 3 Months Ended
Sep. 30, 2020
Aug. 31, 2020
Jul. 31, 2020
Sep. 30, 2020
Total Shares Purchased (in shares)       1,806
Average price per Share (in dollars per share) $ 50.62 $ 50.62
Max Dollar Amount of Remaining Shares $ 3,762,040 $ 3,853,459 $ 3,853,459 $ 3,762,040
Total number of shares purchased during the period [Member]        
Total Shares Purchased (in shares) 1,806 1,806
Total number of shares purchased under the Repurchase Program [Member]        
Total Shares Purchased (in shares) 1,806 1,806
v3.20.2
Note 11 - Information as to Employee Stock Purchase, Savings, and Similar Plans (Details Textual) - USD ($)
3 Months Ended 6 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay     100.00%  
Defined Contribution Plan, Maximum Annual Contributions Per Employee, Percent     3.00%  
Defined Benefit Plan, Plan Assets, Contributions by Employer $ 21,275 $ 21,990 $ 46,656 $ 46,056
v3.20.2
Note 12 - Subsequent Events (Details Textual) - $ / shares
3 Months Ended 6 Months Ended
Oct. 21, 2020
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Common Stock, Dividends, Per Share, Declared (in dollars per share)   $ 1 $ 1 $ 2 $ 2
Subsequent Event [Member]          
Common Stock, Dividends, Per Share, Declared (in dollars per share) $ 1        
Subsequent Event [Member] | Common Stock [Member]          
Dividends Payable, Date to be Paid Nov. 30, 2000        
Dividends Payable, Date of Record Nov. 02, 2020